Investor Presentaiton

Key risks (continued) RETAIL FOOD GROUP Risk Pandemic risk (including COVID- 19) Description The financial and operating performance and financial position of RFG and its franchisees and master franchisees could be materially impacted by the emergence of a pandemic and government, central bank, regulatory and consumer response thereto, or the continuing impact of the COVID-19 pandemic. The COVID-19 pandemic and the measures undertaken to contain it materially changed the global economic outlook, directly or indirectly causing large-scale economic disruption in all markets the Group, its franchisees and master franchisees operate in. The disruption led to, or could lead to, elevated levels of credit losses from business insolvencies and ongoing disruption to trading conditions, including supply chain disruption or delay and inflationary pressures. The impact of COVID-19 on the Group's FY22 performance and operations was significant, particularly in the 1H22 as the full impact of COVID-19 'Delta' variant related lockdowns, vaccine mandates, border closures are other restrictions took effect. In an attempt to mitigate the direct or indirect economic effect of the COVID-19 pandemic, governments, regulators and central banks provided significant fiscal and regulatory support in the 2020 and 2021 years to allow businesses to remain liquid and solvent, and to support employees and the unemployed. Some residual government and industry support measures continued after this time. The extent to which these efforts will reduce the adverse financial effects, direct and indirect, of the COVID-19 pandemic remains uncertain. Whereas the immediate direct impacts of COVID-19 have dissipated following the relaxation of government restrictions in most jurisdictions in which the Group, its franchisees or master franchisees operate, indirect impacts influenced by the pandemic remain. These include labour constraints, inflationary pressures and delays in connection with the availability of goods and materials which have and continue to adversely impact the operation of the Group's domestic and or international franchise networks, or the businesses of customers to whom the Group supplies goods and services. These impacts have contributed to, or may in the future contribute to, closure of businesses, reduced customer counts, supply chain disruption and continuing gross lease arrears in respect of those leases for franchised outlets where the Group is 'head on lease'. Increase in interest The cash rate set by the Reserve Bank of Australia (RBA) has been a significant driver of low interest rates for wholesale funding in the Australian market, including the benchmark rates of RFG's rates and inflationary pressures Ability to Access Capital Markets or Refinance Debt on Attractive Terms Climate change International Operations Australian Accounting Standards Page 24 existing funding arrangements. However, there are currently significant inflationary pressures in the Australian economy, and in response, the RBA has been lifting interest rates and the market is expecting ongoing monetary policy tightening. Increases in the cash rate may have a number of direct or indirect adverse impacts on the Company's financial or operating performance and financial position, including increases to the cost of funding available to RFG, its franchisees and master franchisees, and downwards pressure on consumer discretionary spending which may impact on network sales. The Company's existing senior debt facilities are due to mature in September 2023. RFG relies on debt and equity financing to fund its operations, and its banking facilities will periodically need to be refinanced. RFG's ability to refinance its debt on favourable terms will depend on a number of factors including general economic conditions prevailing at that time, including interest rates, the state of debt and equity markets, as well as the reputation, performance and financial position of RFG. If there is a deterioration in the level of liquidity in debt and equity markets, or the terms on which debt or equity is available, this may prevent RFG from being able to refinance some or all of its debt on current terms or at all, or raise new debt or equity, respectively. The Company relies upon suppliers of food products that are sourced from agricultural products, such as milk, flour, coffee and raw ingredients supplies. Adverse weather and climatic conditions including floods, bushfires, droughts and storms caused by or contributed to by climate change may impact on the Company's ability to source these products if supply chain processes are impacted. There are also potential physical impacts to RFG's store network, including from flood inundation or destruction from bushfire. Any such disruption may have a material adverse impact on the Company's operations and financial performance and financial position. More generally, climate change may impact overall economic growth and national living standards domestically or within those international licensed territories where the Company's brands are present, resulting in downwards pressure on consumer discretionary spending which in turn may impact network sales or demand for value-added goods sold by the Company. Whilst RFG's business is predominantly based in Australia, RFG has granted master franchise rights in certain foreign jurisdictions. Accordingly, RFG is exposed to risks relating to difficulty enforcing contracts, changes or uncertainty in the relevant legal and regulatory regime, fluctuation of foreign exchange rates, political or social instability, terrorism and other issues in foreign jurisdictions. These risks could materially adversely affect RFG's operating and financial performance and financial position. Changes to the Australian Accounting Standards (AAS) are determined by the Australian Accounting Standards Board (AASB). The AASB may, from time to time, introduce new or refined AAS, which may affect the future measurement and recognition of key income statement and balance sheet items, including revenue and receivables. There is also a risk that interpretations of existing AAS, including those relating to the measurement and recognition of key statements of profit and loss and balance sheet items, including revenue and receivables, may differ. Changes to AAS issued by the AASB or changes to the commonly held views on the application of those standards could materially and adversely affect RFG's financial performance and financial position reported in RFG's financial statements.

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