Chairman’s Message

Against this evolving backdrop, Sunshine delivered strong results during the year under review. Group revenue and profitability saw robust growth, driven by disciplined execution, brand-led value creation, and cost containment.

Dear Valued Stakeholders,

It is with great pleasure that I present the Integrated Annual Report of Sunshine Holdings PLC for the year ended 31 March 2025. This message will provide a high-level overview of the operating environment during the year under review, along with the Group’s performance across its core business segments. A more detailed account is provided in the Group Chief Executive Officer’s message that follows.

The financial year 2024–25 marked a turning point for Sri Lanka, as the country entered a new era of political stability following two national elections held in quick succession. This extraordinary transition, which followed a profoundly debilitating economic crisis, promises to steer the country toward a more stable, accountable, and fiscally grounded trajectory. The new administration's commitment to continuity and structural reform, as outlined under the IMF program, quickly allayed any concerns of a disruptive departure from the macroeconomic stabilisation agenda. Inflation was further reduced during the reporting period, as currency volatility subsided and interest rates became more conducive to growth. With a measure of macro-stability now restored across political, economic, and social fronts, the more challenging task is to translate these gains into broad-based, inclusive, and sustainable growth, delivering tangible improvements to livelihoods while maintaining the fiscal discipline that post-crisis growth demands. This transformation will depend on the nation's ability to stay the course on the reform agenda and pursue its growth objectives with urgency and consistency.

Against this evolving backdrop, Sunshine delivered strong results during the year under review. Group revenue and profitability saw robust growth, driven by disciplined execution, brand-led value creation, and cost containment. All core business segments contributed significantly to this outcome. Healthcare remained the Group’s principal revenue and profit generator, while the Consumer Goods segment maintained strong momentum, driven by export growth and brand resilience. The Agribusiness segment, although challenged by input cost volatility and regulatory constraints, demonstrated resilience through disciplined operations. Overall, Sunshine’s performance in 2024–25 demonstrates the strength of our verticals and the Group's strategic direction, while also reflecting our capacity to adapt.

Of particular significance during the year were several structural rationalisation initiatives: the amalgamation of Lina Spiro and Lina Manufacturing and Sunshine Holdings with Sunshine Packaging; and the integration of Sunshine Consumer and Sunshine Tea under a unified vertical. These actions enhanced corporate focus, delivered cost and operational efficiencies, and reduced structural complexity and administrative overheads. Additionally, improved market liquidity following a share split enhanced share accessibility and overall shareholder value.

Sunshine delivered strong results during the year under review. Group revenue and profitability saw robust growth, driven by disciplined execution, brand-led value creation, and cost containment. All core business segments contributed significantly to this outcome.

In terms of strategy, several milestones stood out in 2024–25. The USD 11 Mn. equity infusion from the International Finance Corporation (IFC) into the Healthcare business reaffirmed Sunshine’s long-standing credibility. It also underscored our commitment to improving healthcare access and outcomes for all Sri Lankans. Lina Manufacturing continued to lead the metered-dose inhaler (MDI) segment, consolidating its position and expanding its respiratory product portfolio. Increased capacity now allows us to fully meet both public and private sector demands, adding to our value proposition. During the reporting period, we also strengthened and expanded our last-mile healthcare distribution network through the Healthguard Distribution platform, further bolstering reach and resilience across our supply chain. In Agribusiness, we focused on boosting productivity by adopting best practices, particularly given existing regulatory constraints on oil palm expansion. Consumer Goods saw a reimagining of its supply chain to address evolving market dynamics and improve channel efficiencies. Across all business lines, Sunshine’s investments in digital infrastructure and process improvement continued to drive internal efficiencies and future readiness.

As Sunshine grows, it is imperative that our approach to governance evolves in parallel. I am pleased to report that Board oversight, risk governance, and stakeholder engagement remained robust and proactive during the year under review and continue to be so. Board dynamics remain constructive, characterised by transparency, accountability, and a commitment to long-term value creation.

Looking ahead to the new financial year, we remain optimistic with a degree of caution. While global and regional uncertainties persist, we are confident that Sunshine is well-positioned to seize the opportunities arising from a transforming landscape. With political and economic stability returning, Sri Lanka stands at the threshold of a new era of sustainable growth, and Sunshine, guided by our spirit of national stewardship, is committed to being an active contributor to that journey.

In closing, I extend my heartfelt thanks to our shareholders for their enduring confidence, our employees for their dedication, our management team for their unwavering focus, and my fellow Board members for their invaluable counsel. I am confident that together, we will continue to build a stronger, more sustainable future for all.

A Cabraal

Chairman

28 May 2025