Alterra : Preliminary Final Report

About Alterra Limited

Alterra is developer of the Carpenters avocado project located between Manjimup and Pemberton in Western Australia's south-west.

Stage 2 (7ha) is currently underway following an initial 5ha planting in 2020. The Company is currently optimising the development schedule for Carpenters, with a planned 2022 planting of 85ha.

Alterra is also a 15% shareholder in Carbon Conscious Investments Limited, which manages large scale projects registered with the Clean Energy regulator that generate Australian Carbon Credit Units.

Alterra continues to assess horticultural opportunities fitting within strategy.

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ASX CODE: 1AG 30 NOVEMBER 2021

ASX Announcement 447

onlyAppendix 4E Preliminary Final Report and Accounts for the Year Ended 30 September 2021

Alterra Ltd (ASX:1AG) (Alterra or Company) is pleased to present the ASX Appendix 4E Preliminary Final Report for the financial year ended 30 September 2021.

This announcement has been authorised by the Board of Directors of Alterra.

useFurther information: John McGlue, Chairman

P: ([phone]

E: [e-mail] personal

ForForward Looking Statements

Visit alterra.com.aufor more information.

This announcement contains forward-looking statements that involve risk and uncertainties. Indications of, and guidelines or outlook on, financial position and returns, performance, targets, timelines, estimates and assumptions in respect of production, prices, operating and other costs, capital expenditures and development timelines are forward looking statements. These statements are based on an assessment of present economic and operating conditions, and on a number of assumptions and estimates regarding future events and actions that, while considered reasonable as at the date of this announcement are inherently subject to significant technical, business, economic, competitive, political and social uncertainties and contingencies. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and other important factors, many of which are beyond the control of the Company, the directors and management. We cannot and do not give any assurance that the results, performance or achievements expressed or implied by the forward-looking statements contained in this announcement will actually occur and readers are cautioned not to place undue reliance on these forward-looking statements. These forward-looking statements are subject to various risk factors that could cause actual events or results to differ materially from the events or results estimated, expressed or anticipated in these statements.

Alterra Ltd ASX 1AG
144 Northwood St. West Leederville WA 6007 Australia	1

For personal use only

ALTERRA LIMITED

ABN 20 129 035 221

ASX Preliminary Final Report

Appendix 4E

30 September 2021

Lodged with the ASX under Listing Rule 4.3A

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ALTERRA LIMITED APPENDIX 4E PRELIMINARY FINAL REPORT 30 SEPTEMBER 2021

	RESULTS FOR ANNOUNCEMENT TO THE MARKET
only							Consolidated
					2021	2020
						$'000	$'000
		Revenue from ordinary activities		Down 13%	641	736
		Profit / (loss) before income tax from continuing		Up 47%	(2,221)	(1,507)
		operations
use		Profit / (loss) after tax attributable to members		Up 47%	(2,221)	(1,507)
REVIEW OF OPERATIONS
	Operational Highlights
	(a)	Leading investment management and corporate advisory firm Pendulum Capital Pty Limited engaged to
personal		project manage the planting program for Stage 2 of the Company's flagship Carpenters avocado project
	in Western Australia's south-west;
	(b)	A company associated with Pendulum Capital Pty Limited, led by successful agribusiness investors and
			operators Peter Fogarty and Greg Harvey, acquired a 17.42% stake in the Company;
	(c)	Field preparation of the Stage 2 development block progressed with planting expected before the end of
			the calendar year;
	(d)	Advanced progress towards future development at Carpenters, including equipment procurement,
			drainage, irrigation and site works;
	(e)	R&D five-hectare trial site planted in October 2020 and tree growth monitored throughout the year;
	(f)	Construction commenced of a large-scale water asset by the landowner at Carpenters;
	(g)	Subsequent to year end, the Company announced the appointment of highly credentialled avocado
For		grower Ben Norrish as Head of Horticulture and to oversee the development of the Company's Carpenters
	Project.
	Subsequent to year end the Board has been notified by Carbon Conscious Investment Limited ('CCIL') of
	(h)

an unsolicited partial offer for 19.9% of CCIL.

Carpenters Project - Stage 2

Alterra's focus has been on development of the Carpenters Project.

As part of this strategy, in July 2021, the Company announced that leading investment management and corporate advisory firm Pendulum Capital Pty Limited ('Pendulum') had been engaged to project manage the coming planting program for Stage 2 of the Company's flagship Carpenters avocado project in Western Australia's south-west (Carpenters Project).

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Higher density plantings

Overall reduction in capex per tree

High performance micro-sprinklersin line with industry standards in the district

Extra water storage capacity to capture off-streamwater on site to provide additional water security and open up further expansion potential beyond the current program

Reduced 2021 planting to approximately 7ha (circa 5,000 trees) due to heavy rain on site over winter, bringing the total planted area to approximately 12ha

Balance of Stage 2 planting in spring 2022, subject to a final investment decision Enhanced drainage and infrastructure on site to service growth in 2022 and beyond Commencing preparations to plant up to 60,000 trees across 85ha in spring 2022.

Stage 2 ground preparation

ALTERRA LIMITED APPENDIX 4E PRELIMINARY FINAL REPORT 30 SEPTEMBER 2021

Pendulum is led by successful agribusiness investors and operators Peter Fogarty and Greg Harvey and is associated with Penagri Holdings Pty Ltd - a 17.42% shareholder in Alterra. The Pendulum team has decades of experience in developing and managing large-scale, highly profitable agriculture projects, including

onlyrehabilitation and planting programs.

The engagement of Pendulum was made following a request by the Alterra Board for Pendulum to assume a project management role and reflects the outcome of a strategic and operational review conducted by Pendulum and instituted by Alterra's Board of Directors to ensure the Carpenters Project is optimally developed.

usepersonalIn August 2021, the Company announced an update on the approach to the planting program for Stage 2. It was noted that whilst field preparations had progressed to the extent possible, due to the unseasonably heavy rain in WA's south-west,a substantial portion of the site preparation had been affected and the wet ground had made it impossible to mobilise heavy equipment for final soil preparation and additional sub-surfacedrainage. As a result, the Stage 2 plantings in 2021 would be heavily curtailed.

The Board and the Alterra technical team have worked alongside Pendulum to develop a strategy to optimise development plans with a strict focus on costs and efficiencies, while effectively managing site conditions to ensure the long-term performance and sustainability of the project.

ForThe revised development strategy for Stage 2 includes:

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ALTERRA LIMITED APPENDIX 4E PRELIMINARY FINAL REPORT 30 SEPTEMBER 2021

At full planting, the Carpenters project will be serviced by a major dam currently under construction by the landowner under the terms of Alterra's 50-year lease. Construction of the dam continues to advance, albeit the unseasonably heavy rain has interrupted the construction schedule.

onlyAlterra has also decided to explore a cost-efficient plan to potentially expand the existing off-stream dam which currently services the 5ha Stage 1 trial planting completed in 2020, mitigating inherent risk from a single water source and adding valuable water security.

In keeping with previous practice, a final investment decision on future stages of the project will be made at a date closer to scheduled planting and subject to routine commercial considerations.

useCarpenters Site Development

Construction by the landowner of the large-scale dam to provide long-term security of water supply to the project has significantly progressed. The existing 37 megalitre holding dam and 500 megalitre per annum of water secured from adjoining property under the Carpenters lease will be used to support the project while the main dam infrastructure is completed. Dam ground preparation works including earthmoving has progressed and a large excavation area is now evident. The area will eventually form the foundations of the embankment wall. Two large offtake pipes are also onsite and will be positioned through the embankment

personalwall to enable irrigation of the orchard.

The landowner is responsible for all licences and permits in relation to the dam and continues to work closely with regulatory authorities throughout the development process to deliver the water contracted to Alterra under the Carpenters lease agreement.

For

Dam site progresses under landowner construction

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