TCFD CONSISTENT CLIMATE-RELATED FINANICAL DISCLOSURES STATEMENT 2025

Energy and GHG Emissions Foreword  

Recognising the urgent need to address climate change and support the transition to a net zero economy, the Company is committed to reaching net zero greenhouse gas ("GHG") emissions across its value chain by 2050.

During the reporting period, the Company reached a further milestone linked to its net zero commitment, with the publication of its first Climate Transition Plan ("Transition Plan"). The Transition Plan details how the Company intends to reduce its emissions in line with the Company's Science Based Targets initiative ("SBTi") approved emissions reduction targets, building on the initial decarbonisation analysis conducted when the Company's targets were first set in 2024.

The publication of the Transition Plan reflects the Company's belief in the importance of transparent, decision-useful sustainability reporting to improve our accountability to stakeholders. The Company's SECR and TCFD Report can be found below on pages 36 to 48. In addition, the Company's GHG independent limited-assurance report and standalone Sustainability Report, covering its wider performance against the three pillars of its Sustainability Strategy, are both available on the Company's website.  

The Company remains committed to further progressing its climate-related strategy and emissions reductions activities, as it continues to make progress on its Transition Plan and Net Zero commitment. 

Streamlined Energy and Carbon Reporting ("SECR")  

The below table and supporting narrative summarise the Company's SECR disclosure, in compliance with the Companies (Directors' Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018. Data for the years FY24 and FY25 is included as this is the Company's third year of SECR disclosures. 

In 2025, the Company successfully completed the internalisation of the Company's management function. From March 2025 SUPR formally employs staff, moving away from the external advisory arrangement with Atrato Group. As a result, emissions from SUPR office consumption (Scope 1 and 2), Waste, Business Travel and Employee Commuting (Scope 3) are now being calculated as part of the GHG inventory. This year, emissions from waste generated in SUPR-controlled communal areas of the Company's assets have also been accounted for.

An error in the electricity and gas data at Willow Brook Shopping Centre was found for the previous reporting year (FY24), resulting in missing Scope 1 and 2 emissions reported last year. This has now been rectified and restated figures are included in the table below. The correction has resulted in a 121% increase in Scope 1 and 2 emissions and a 0.4% increase in total emissions for the reporting year FY24. This has not led to a material change in estimations - see appendix for further detail. Year-on-year comparisons will compare the current reporting year (FY25) against these corrected values for the previous reporting year (FY24).

Compared to the previous reporting year (FY24), there has been a decrease in Scope 1 emissions from 56 tCO₂e to 18 tCO₂e (68% reduction) in the current reporting year due to improved accuracy of data and reduced consumption. In contrast, there has been an increase in Scope 2 location-based emissions from 172 tCO₂e to 253 tCO₂e (47% increase) due to improved accuracy of data and increased consumption. For seven of the communal areas, the use of renewable electricity at these sites, evidenced by green electricity certificates, has resulted in a decrease in total Scope 2 market-based emissions in this reporting period (see Table C). Due to this overall increase in the Company's Scope 1 and 2 location-based emissions, emissions from Fuel and Energy related activities ("FERA") (Scope 3 category 3) have also increased from 66 to 86 tCO₂e (30% increase) for this reporting year.⁵⁷

Emissions from Purchased Goods and Services (Scope 3 category 1) have increased from 2,215 to 3,882 tCO₂e for this reporting year, driven by an increase in spend. This is likely linked to internalisation process as the main increase was detected in spend related to legal and financial services. This year no newly built properties have been added to the portfolio; therefore, no emissions are attributed to Capital Goods (Scope 3 category 2).  

In April 2024, SUPR acquired a portfolio of Carrefour omnichannel supermarkets in France through a sale and leaseback transaction. This is the first year these assets have been included in the reporting. Additionally, one UK supermarket has also been acquired in this reporting year. Even with the acquisition of this new asset and the inclusion of Carrefour assets, Scope 3 energy consumption and resultant emissions from Downstream Leased Assets (Scope 3 category 13), which includes tenant Scope 1 and 2 emissions, have decreased from 81,931 to 59,138 tCO2e (28% decrease). Our calculation of downstream leased assets emissions includes refrigerant emissions alongside energy use given the material consumption of refrigerants used in supermarkets. This goes beyond the minimum boundaries required by the Greenhouse Gas Protocol. This year's reduction in emissions is primarily driven by the increased availability of refrigerant data from supermarket tenants, offering a more accurate representation of refrigerant-related emissions, but not reflecting an actual decrease in emissions. We will consider how this newly available data may be used to support more accurate recalculation of base year emissions in future. A decrease in supermarket tenant electricity consumption has also reduced absolute Scope 3 category 13 emissions. Overall, total Scope 1, 2 and 3 emissions have decreased from 84,621 tCO₂e in the previous reporting year to 63,423 tCO₂e (25% reduction) in the current reporting year. 

Methodology 

The FY25 footprint within the scope of SECR reporting is equivalent to 272 tCO₂e, for mandatory emissions reporting, and 63,423 tCO₂e, including voluntary emissions, with the largest portion being made up of emissions from downstream leased assets at 59,138 tCO₂e.  

Anthesis (UK) Limited ("Anthesis") has calculated the above GHG emissions to cover all material sources of emissions for which the Company is responsible. The methodology used is aligned with the GHG Protocol: A Corporate Accounting and Reporting Standard (revised edition, 2015). Responsibility for emissions sources was determined using the operational control approach. All emissions sources required under The Companies (Directors' Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018 are included. 

Raw data captured in spreadsheets including energy spend and consumption data has been collected by the Company. Where actual consumption data was available for natural gas, electricity and refrigerants, this was used. To address data gaps, the most appropriate proxy was applied by using either previous year's data, actual data to calculate average monthly consumption, or by applying the average floor area intensity from sites with actual data. Average floor area intensity calculations excluded high-consumption outliers; for example, estimates for carpark sites were derived solely from other carparks, which are expected to have comparable energy intensity. Fuel oil was estimated by applying the average 2024 UK fuel oil price to the budgeted spend for fuel oil. Fuel oil estimated energy was then converted to GHG emissions using the UK Government's GHG Conversion Factors for Company Reporting 2024.

Scope 3 emissions have been calculated for relevant material categories using consumption data, spend data, floor area and EPC data. Fuel and Energy related activities includes well-to-tank ("WTT") and transmission and distribution ("T&D") upstream emissions from Scope 1&2. For Purchased Goods and Services, Environmentally Extended Input Output ("EEIO") has been used. Spend data was provided per supplier and mapped to 2023 DEFRA Input/Output ("IO") categories. No newly built sites were acquired during this reporting year, therefore there were no Capital Goods this year.

Where actual data was not available for Downstream Leased Assets, industry energy consumption benchmarks were used in combination with EPC data on energy use and heating type. This year, full or partial refrigerant data was provided for all supermarket tenants. Where refrigerant data was only partially provided, publicly available air conditioning ("AC") certificates were used to determine the type and amount of refrigerants. Where this was not available, other similar sites were used as proxies to estimate refrigerant consumption. Supermarket refrigeration capacity and non-food air conditioning was estimated using floor-area intensity data from EPA where actual data was not available. Refrigerant loss rate for refrigeration appliances was estimated from Direct Emissions from Use of Refrigeration, Air Conditioning Equipment and Heat Pumps from DEFRA.  

Biogenic carbon emissions from combustion of biomass have been excluded from the Scope 1, 2 and 3 emissions reporting in the table above as per the GHG Protocol they must be reported separately. Biogenic CH₄ and N₂O have been included in the emissions reporting table. Biomass energy consumption resulted in 15,848 tonnes of biogenic CO₂ in the 2024-2025 reporting period. kWh energy consumption associated with biomass is included in the table above.

The Company continued its efforts to improve energy efficiency across landlord-controlled areas and to support tenant-led energy efficiency measures in FY25, as discussed in the TCFD Report below and the Company's standalone Sustainability Report.

Approach to GHG emissions restatements  

To improve its GHG reporting, the Company may restate previously reported data to provide a more accurate representation of previous performance and its decarbonisation journey, should a significant change or error be identified, such as: 

·     Significant changes in company structure and activities  

·  Methodology changes such as improvements in emissions factors, data access and calculation methodologies 

·     Discovery of significant error(s) in previously reported data 

The Company will restate the FY23 baseline used for its Scope 1, 2 and 3 emissions reductions targets if any of the changes above result in a change of 5% or more, in line with the requirements of the SBTi. The impact of the Carrefour portfolio acquisition, along with methodology changes from improved refrigerant data accuracy, has been assessed against the Company's SBT baseline. This assessment revealed a change in base year emissions exceeding 5%, prompting the Company to recalculate base year emissions (see Table C).

Taskforce on Climate-Related Financial Disclosures ("TCFD") 

Introduction 

The Company has complied with the requirements of the Financial Conduct Authority's ("FCA") UK Listing Rules ("UK LR") 6.6.6.(8) by including its TCFD Statement for FY25 below.

The Company's statement is consistent with the four core TCFD pillars, in relation to governance, strategy, risk management and metrics and targets, and all eleven underlying specific recommended disclosures.⁶⁶

The Company's key progress on its climate strategy and net zero commitments include an updated climate risk assessment (encompassing the portfolio of Carrefour assets for the first time), refreshed emissions reduction modelling and publication of the Company's first standalone Transition Plan in June 2025.

Governance 

Describe how the board exercises oversight of climate-related risks and opportunities: 

The Board is responsible for overseeing the Group's risk management framework, including the consideration of climate-related risks and opportunities affecting the business, as part of its wider oversight of the Company's sustainability strategy.

To ensure the effective oversight of climate-related issues and the wider sustainability strategy of the Company, the Board established its ESG Committee in May 2022, whose role helps to ensure that sustainability issues, including climate change, are discussed in sufficient detail and given appropriate focus at the Board level. The ESG Committee, Chaired by Frances Davies, meets at least four times a year. See the ESG Committee Report on pages 82 to 83 for more details on Committee members and how the Committee operates.

The Board and ESG Committee is primarily informed of climate-related issues by the Company's Sustainability Consultant through the meetings of the ESG Committee, at which an ESG Update Paper is presented covering relevant climate related issues, progress against targets and broader sustainability strategy updates. The Committee monitors the Company's ESG performance against the KPIs shown in the Metrics and Targets section of this report. As the Company contracts the sustainability function to Atrato, the Sustainability Consultant plays a key role in ESG matters and climate-related issues.

Climate-related issues are also considered by the Board and the Company's management team in acquisition, development and asset management decision making. This process is described below under the managing climate-related risks section of this statement.

The Company's governance structure regarding climate risks and opportunities is summarised in Figure 1.

Figure 1 | Governance structure related to climate-related risks and opportunities 

Climate and Environment remains one of the three key pillars of the Company's Sustainability Strategy. The ESG Committee receives a report and verbal update from the Company's Sustainability Consultant at every quarterly meeting in relation to this aspect of the strategy, and the other two pillars (namely, Tenant and Community Engagement and Responsible Business).

The ESG Committee update includes the Company's quarterly performance against environmental metrics and broader delivery of the Company's sustainability strategy, including activities such as the roll-out of rooftop solar photovoltaic ("PV") and EV charging, improvement of Energy Performance Certificate ("EPC") ratings, ESG-related investor engagement and climate transition planning. These updates allow the ESG Committee to oversee the Company's performance against the sustainability strategy. The ESG Committee is also involved in the review process and ultimate approval of the Company's TCFD Report.

The Board is committed to ongoing improvement of the Company's climate-related disclosures. During the reporting year, sustainability consultancy Anthesis was again engaged to provide external support to help shape the Company's response and alignment to the TCFD recommendations. As part of this support, Anthesis provided analysis of, and recommendations on, the Company's final disclosures to further advance its progress against best practice approaches.

The Board is invested in enhancing the Company's understanding of climate risks and opportunities and, as part of this, approved budget allocation for ongoing climate-related activities, for the next reporting year. This facilitates forward planning and preparation of ESG matters targeted for the next reporting year. 

The Board recognises that appropriate training and upskilling is a key enabler to ensure successful implementation of the Company's sustainability strategy and, specifically, the integration of sustainability factors into the investment process. During the reporting period, the Company's Sustainability Consultant delivered training to the Company's employees on the topic of transition planning and the Company's GHG inventory, in order to support the management of these issues in the Company's activities.  

Describe management's role in assessing and managing climate-related risks and opportunities: 

Climate-related risk and opportunity considerations are integrated within management roles in the investment and asset management decision making process, ensuring that the potential financial impacts of climate-related issues are evaluated and addressed.

The Company has an internal ESG Working Group, led by the Company's Sustainability Consultant. Climate risk and TCFD is a material topic for this Working Group, and therefore is a standing agenda item at the meetings of the ESG Working Group to ensure frequent messaging and updates on climate-related topics, as well as to facilitate and enhance understanding of climate impacts across teams. Additionally, the Company seeks to ensure climate-related issues are a standing item when engaging with the Company's tenants. This includes discussion on topics such as any planned tenant-led investments in store refurbishments and energy efficiency upgrades, energy consumption data sharing and improvements to EPC ratings. Such engagement occurs multiple times per year and more frequently with larger site tenants.  

Sustainability Consultant

The Company's Sustainability Consultant is responsible for the day-to-day delivery of the Company's sustainability strategy, as approved by the Board, including the assessment, management and reporting of climate-related risks and opportunities, and leads the provision of climate risk advice to the Company's Senior Leadership Team. The Sustainability Consultant also has responsibility for overseeing relevant climate-related targets and the preparation of the Company's climate-related reporting and co-ordination of third-party service providers who provide input into this, including overseeing preparation of the Company's GHG inventory and the independent limited GHG assurance process.

Internal ESG Working Group

The ESG Working Group, led by the Company's Sustainability Consultant, consists of the following members: the Company's CEO, Head of Operations and IR, and Head of Asset Management. The Working Group is responsible for oversight, monitoring and management of sustainability risks and opportunities including those related to climate change. This includes the review, monitoring and management of climate-related risks relevant to current and future assets in the portfolio. The Sustainability Consultant and Asset Management aim to meet at least fortnightly to discuss ESG issues impacting the Company, and climate risk is a standing agenda item as part of these meetings. The Company's CEO and Head of Operations and IR join on an as needed basis. Other employees of the Company, including the Investment Director, are invited on an ad-hoc basis to meetings with climate-related agenda items. Meeting minutes are circulated to the full Working Group following every meeting.

Strategy 

Describe the climate-related risks and opportunities the organisation has identified over the short, medium, and long term. 

In accordance with TCFD recommended disclosures, the Company has identified climate-related risks and opportunities across two key categories: (1) physical risks related to the physical impacts of climate change (acute and chronic) and (2) transition risks related to the transition to a low carbon economy (policy, legal, technology, and market). 

The Company considers these risks over three key time periods: from 2025 until 2030 (near-term), from 2030 to 2050 (medium-term) and 2050 to 2100 (long-term).   

Over the last year, the Company carried out an updated transition and physical climate risk analysis for the entire portfolio, including the Company's French assets for the first time. Further information on the Company's approach to Scenario Analysis is available in the Risk Management section of this TCFD report. For the second year, the Company utilised the MSCI Real Assets (Real Estate) Climate Risk Tool (the "MSCI tool") and associated Climate Value at Risk ("CVaR") outputs to support this analysis and quantify the physical risks across the post-2050 (long-term) time horizon.⁶⁷

The Company considered three key temperature scenarios as part of its scenario analysis conducted this year: 

These scenarios were chosen following the recommendation of MSCI as being preferred scenarios for this type of climate analysis and in the absence of an established real estate industry standard. The Delayed Transition scenario is a further scenario to the Company's FY24 analysis to incorporate a "middle of the road" approach in contrast to the more ambitious, but potentially unachievable 1.5°C scenario (due to insufficient global action). Further details the data sets used as part of the Company's scenario analysis are included in the appendix of this TCFD Report. 

The outputs provide a quantitative risk assessment using set Financial Risk Categories determined based on the asset's CVaR, which then supports an assessment of the portfolio's exposure to climate-related physical risks and associated value at risk. For each hazard and for the transition risk, the CVaR is classified into one of seven buckets as shown in Figure 2 below.⁶⁸

Figure 2 | Financial Risk Category 

The Company recognises the MSCI tool is only one of many different scenario analysis tools currently available on the market. Such tools and the underlying data models and inputs they utilise rely on certain assumptions and are constantly evolving as climate research and available data sets continue to advance. This was seen during the reporting period with a change in the underlying flood model used by the MSCI tool, with MSCI adopting a new third party flood model (Fathom) to replace its legacy model. Key changes and strengths with the new Fathom Global Flood Map include:

·    The ability to assess three types of flood risk: coastal, fluvial and pluvial - also known as surface flooding (previously only coastal and fluvial hazards were available)

·    Sophisticated flood protection modelling in which only the overtopping water causes flooding (based on open-source protection datasets and manual collection in collaboration with regional stakeholders).

Deeper dive analysis enables enhanced understanding of the impact of climate-related risk. This year, the Company has chosen to build upon the physical risk analysis conducted in FY24 in three key ways:

1.    FY25 UK Analysis Update: Refreshing the UK flood risk analysis that was first conducted in FY24 through the updated MSCI tool; and

2.  Carrefour Analysis: Expanding coverage of physical risk analysis to the Carrefour portfolio of assessments, ensuring climate analysis over the Company's entire portfolio.  

3.   Ongoing Climate Due-Diligence: Utilising a combination of both the MSCI tool and UK Government Flood Risk tool to conduct climate-risk reviews for all assets as part of pre-acquisition due diligence.

FY25 UK Analysis Update

In FY25, the MSCI tool was again used to conduct a physical risk assessment, identifying the percentage of the Company's UK assets at above negligible risk.⁶⁹ The assessment aimed to refresh the FY24 flood risks findings (which was identified from the FY24 results as the key physical risk the Company is exposed to).

The outputs of this assessment under the high emissions 3°C (Current Policies) temperature scenario (applying a 2050 time horizon and aggressive outcome)⁷⁰ highlighted the following results for the portfolio⁷¹:  

·   The vast majority (86%) of the Company's UK assets are exposed to negligible (>0 to 0.5% CVaR) aggregate physical risk overall. 

·    93% of the Company's UK assets have either no identifiable or negligible exposure to coastal flooding risk (vs 89% in FY24)

·    100% of the Company's UK assets have either no identifiable or negligible exposure to fluvial flooding risk (vs 83% in FY24).⁷² 

·    95% of the Company's UK assets have either no identifiable or negligible exposure to pluvial flooding risk (risk not measured in FY24).

·     This is in line with the MSCI UK Quarterly Supermarket Benchmark which also identifies negligible CVaR from coastal and pluvial flooding and no identifiable fluvial flood CVaR under the same scenario and 2050 time horizon. 

Fluvial and pluvial flood risks reduce significantly under a 2°C (Delayed Transition) temperature scenario and further reduce under a 1.5°C (Orderly) temperature scenario (both applying a 2050 time horizon and aggressive outcome), with 100% of the Company's UK assets having either no identifiable or negligible exposure. However, coastal flood risk remains the same. 

Carrefour Analysis

The same 3°C (Current Policies) (2050 time horizon and aggressive outcome) temperature scenario was applied to the Company's assets in France and highlighted the following results⁷³:

·     96% of the Company's French assets are exposed to negligible (>0 to 0.5% CVaR) aggregate physical risk overall. 

·     No identifiable coastal flood risk for any of the French assets.

·     100% of the French assets have either no identifiable or negligible exposure to fluvial flooding risk.

·    96% of the Company's French assets have either no identifiable or negligible exposure to pluvial flooding risk.

Describe the impact of climate-related risks and opportunities on the organisation's businesses, strategy, and financial planning. 

The Company's material climate-related risks remain the same as identified in FY24. Table A below provides a description of each risk and the Company's assessment of potential impact and risk management strategy (including mitigating actions and resilience factors).  

Table A| Climate-related risks summary  

In addition to the risks outlined above, in FY23 the Company identified market shifts to be a prospective opportunity. By accelerating deployment of energy efficient measures, setting a Science Based Target ("SBT") and better aligning with tenant preferences, the Company could gain a competitive advantage relative to other commercial landlords who are not as progressive on in their climate and sustainability related ambitions. This could enable increased tenant demand and rent premiums.  

During both FY24 and FY25, the Company has acted on this opportunity, first by setting SBTi approved emissions reduction targets and then by preparing and publishing its first Transition Plan. In addition, the Company continues to engage with tenants on the deployment of energy efficiency improvement opportunities and broader asset-level enhancements such as progressing roll out of rooftop solar PV and installation of EV across the portfolio. These measures and the Company's targets in relation to climate-related opportunities are discussed in more detail under the Metrics and Targets section of this report, in Tables B and D.  

Over the next reporting cycle, the Company plans to further validate the outputs from the FY25 climate-risk assessment and Carrefour analysis, including specific review into the assets identified from this assessment as being exposed (i.e. above negligible in the ratings) to flooding. Through this ongoing work, where necessary, the Company will determine appropriate strategic responses to validate asset-level flood risk, for example, the development of site-specific flood management plans or engagement of further environmental surveys.  

Describe the resilience of the organisation's strategy, taking into consideration different climate-related scenarios, including a 2°C or lower scenario.

The Company's scenario analysis outputs from FY25 have highlighted the following findings:  

·    Overall, the current portfolio is not highly exposed to physical risks given the location of the assets.  

·    Of the physical risks assessed, flood risk (specifically coastal and pluvial) is the most material risk for the portfolio.  

·     The impact of climate-related physical risks to the portfolio is expected to become more relevant in the long term under a high emissions scenario. 

·    Risks arising from the transition to a low carbon economy are expected to be higher in the short term under a 1.5°C scenario, driven by policy and legal changes, such as potential minimum EPC rating requirements. Under a 3°C scenario transition risks remain low over the short to medium-term until the point whereby policy and legal changes (particularly adaptation measures) are required to address increasing physical impacts. 

A benefit of owning mission-critical real estate is that the Company's tenants make significant investments in maintaining, upgrading and decarbonising the Company's store estate. These investments are linked to the ambitious net zero targets and associated energy efficiency commitments of the Company's largest tenants. Not only do these investments drive improvements in energy consumption at the store level, they have also helped the Company to see an improvement in EPC ratings, supporting the Company with progress against its EPC-related improvement targets. In addition to acting as a transition risk mitigant, these decarbonisation investments and the long-dated nature of the Company's leases also create an incentive for the Company's tenants to build physical climate-resilience considerations into their own long-term management strategies for the stores they occupy.  

Further details on resilience factors are also covered in Table A above.

Risk Management 

Describe the organisation's processes for identifying and assessing climate-related risks. 

The Company's approach to risk assessment is as set out in the Our Principal Risks Section on pages 49 to 51.   

The Board has responsibility for the Company's risk management and internal controls, with the Audit and Risk Committee reviewing the effectiveness of the Board's risk management processes on its behalf. The ESG Committee is responsible under the delegated authority of the Board for the monitoring of climate-related risks (both physical and transition) which are incorporated into the risk management process.  

Pre-acquisition

At the pre-acquisition stage, each potential asset undergoes an ESG due diligence and climate risk assessment, including preparation of asset-specific ESG reports that specifically evaluate climate risk. These reports include an analysis of potential vulnerabilities, such as exposure to flooding and other climate-related physical risks. The emissions reduction targets of the assets tenant(s) is also reviewed to assess alignment with the Company's own targets, as part of each transition review. If climate-related risks are identified in an acquisition opportunity further due diligence will be undertaken, for example additional site surveys and analysis, and consideration of any adaptation measures.  The findings from these assessments and any identified risks are reviewed and discussed by the ESG Working Group. This proactive approach ensures that the potential impacts on asset value are understood at the pre-acquisition stage and if the acquisition proceeds, that climate-related risks are managed and monitored going forward.

A key component of the Company's pre-acquisition due diligence relates to the energy efficiency of assets: for example, no asset with an EPC below C can be acquired unless a demonstrable EPC improvement plan is developed, the cost of which is reflected in the investment case for the asset acquisition. Opportunities for the installation of energy efficiency and renewable technology in support of the net zero transition (such as rooftop solar PV and EV charging) as well as potential biodiversity improvement opportunities are also considered as part of the investment case. 

Post-acquisition

A key aspect of the Company's asset management strategy is sustainability performance improvement. The Company's Sustainability Consultant and Asset Management regularly review the operational sustainability performance of the Company's assets including tracking key environmental performance metrics such as EPC ratings, percentage of the portfolio with EV charging and rooftop solar. The Sustainability Consultant oversees the collection of energy consumption and other ESG data directly from tenants which is a key input into the Company's GHG Inventory calculations. This enables the tracking of operational energy performance and YoY emissions against the Company's emissions reduction targets. The Company's Asset Management team has responsibility for managing EPC rating assessments for existing assets in the portfolio, which are conducted on a rolling basis when there are known sustainable improvements to assets, on expiry or following a change to EPC calculation methodology.

The Company has committed to an annual review of its climate-related risks, with the target to annually assess 100% of the existing portfolio of assets and every new asset at acquisition stage. Existing assets undergo Scenario Analysis using the MSCI tool to identify climate-related risks and quantify the prospective financial impact. The Physical Risk model integrated within the MSCI tool assesses the cost of physical risks on buildings, using climate data for the given locations of assets incorporating the hazards of extreme heat, extreme cold, fluvial and coastal flooding, tropical cyclones and wildfire (see Figure 2). However, given the Full Repairing and Insuring ("FRI") nature of the majority of our leases, the Company has adopted this method of scenario analysis as an efficient way to review its portfolio while recognising the limitations of CVaR as a reflection of actual financial risk.

A summary of the key climate data sets integrated into the MSCI Physical Risk model is included in the appendix of this TCFD Report. 

Figure 2 | Physical Risk Hazards: 

Describe the organisation's processes for managing climate-related risks. 

As part of the acquisition due diligence process, the Company undertakes an assessment of each asset against a set of sustainability criteria.

Both physical and transition climate risks associated with the Company's portfolio are assessed and included in the risk register. Materiality and prioritisation determinations are made through impact, likelihood, and risk scoring as a part of the risk register. Inherent and residual probabilities are assigned to each risk, from which a risk score is derived. The climate-related risks included in the Company's Risk Register are updated to reflect the findings from the Company's annual climate risk assessment to ensure that emerging risks and any changes to climate projections or the Company's portfolio are captured. Mitigating actions are described in detail in the risk register, laying out governance structure and processes in place aimed at mitigating each risk. Finally, actions taken to mitigate risks are tracked and recorded in the register.  

In addition, the Company's Sustainability Consultant coordinates internal ESG Working Group meetings to allow collaborative communication and management of climate-related risks relevant to current and future assets in the portfolio.

Describe how processes for identifying, assessing, and managing climate-related risks are integrated into the organisation's overall risk management. 

The Company's approach to risk assessment is as set out in the Our Principal Risks Section on pages 49 to 51.

The Company manages its risk related to its emissions profile, and associated regulatory risk, by monitoring, measuring, and disclosing its Scope 1, 2, and 3 GHG emissions, and identifying and progressing available decarbonisation levers, as outlined in the Company's first Transition Plan, published in June 2025.  

Tenant engagement is a core pillar of the Company's Sustainability Strategy and includes engagement on energy efficiency measures and support of tenants' own decarbonisation efforts and targets. As part of Scope 3 emissions initiatives over the last reporting period the Company has undertaken increased engagement efforts with tenants on collecting energy consumption and other ESG performance data. 

Metrics and Targets 

Disclose the metrics used by the organisation to assess climate-related risks and opportunities in line with its strategy and risk management process. 

To better understand and manage its climate-related risks and opportunities in line with its strategy and risk management process, the Company measures a number of climate-related metrics, see Table B below. 

Table B | Climate-related metrics 

Disclose Scope 1, Scope 2, and, if appropriate, Scope 3 GHG emissions, and the related risks. 

The Company has again engaged external consultants, Anthesis, to prepare its GHG inventory for FY25, covering Scope 1, 2 and 3 emissions. The Company's full GHG inventory, prepared in line with the GHG Protocol methodology is disclosed below in Table C (see Appendix A for further details of the methodology).  

Table C | GHG Inventory⁸⁰ 

The Company's scope 1, 2 and 3 emissions total 54,362 tCO₂e (location-based) in its FY25 reporting year. Scope 3 accounts for the vast majority of the Company's emissions at more than 99%, totalling 54,091 tCO₂e (location-based). This is to be expected as the Company's Scope 1 and 2 emissions from the communal spaces of its assets is relatively immaterial, producing 271 tCO₂e (location-based) collectively. The majority of the Company's emissions come from their leased properties which sit under Scope 3, category 13 downstream leased assets.  

The Company engaged Grant Thornton UK LLP to provide independent limited assurance over the Company's GHG emission data disclosed in the SECR table above, using the assurance standard ISAE 3000 (Revised) and ISAE 3410, for the year ended 30 June 2025. Grant Thornton has issued an unqualified opinion over the selected data and the full assurance report is available on the Sustainability page of the Company's website: Sustainability - Supermarket Income REIT. 

Improving the quantity of actual (vs estimated) energy and refrigerant consumption data, has been a priority for the Company over the reporting period. As a result, the amount of estimated data has reduced, from 71% estimated in FY24 to 37% estimated data for this reporting period. The improved refrigerant data in FY25 has been the key driver of the reduction in estimated emissions. The majority of the Company's emissions from downstream leased assets come from assets leased out to supermarkets. Therefore, the Company has prioritised engagement on data sharing with its supermarket tenants. As a result of these engagement efforts with supermarket tenants specifically the following improvements have been made: 

·    The amount of actual purchased electricity (market based) data in FY23 was 23%, improving to 52% actual data in FY24 and 61% in FY25.

·     The amount of actual natural gas consumption data in FY23 was 27%, improving to 70% actual data in FY24 and 66% in FY25.

·      Actual refrigeration gas data for the first time: 29% vs 0% in FY24.

This has subsequently improved the overall accuracy of the Company's emissions disclosures on the prior year. This is a marked improvement from FY22 where 100% of emissions were estimated.

Details of the remaining assumptions and proxies used to complete the Company's GHG inventory where actual data was not available, are outlined in the Appendix A. 

Describe the targets used by the organisation to manage climate-related risks and opportunities and performance against targets. 

The Company has set ambitious climate-related targets, including both near-term and long-term/net zero emissions reduction targets, which were validated and approved by the SBTi in March 2024 see Table D below

Table D | Science Based Targets 

Details on how the Company plans to achieve its Science Based Targets can be found in the Company's standalone Transition Plan. Given the FRI nature of the majority of the Company's lease arrangements and associated limitations to site control, the Company has not yet set further specific targets with regards to the opportunity of on-site solar PV and on-site EV charging installation. However, the Company continues to actively engage with tenants on such opportunities and to support installations wherever feasible.  

The Company does not currently use carbon offsets and will be prioritising investment on decarbonisation activities in the near term. In future, the Company may review their application, including how they could support the Company's net zero agenda.

The Company will again review its selection of climate-related metrics and targets over the next reporting period to ensure that it continues to measure and manage its climate-related risks and evolve its approach to meet best practice guidance and stakeholder expectations.  

FY26 Priorities

Having now prepared and published its first Transition Plan, the Company is focused on the priority transition activities outlined to ensure continued progress is made to reduce the Company's GHG emissions in line with its science-based emissions reductions targets. The Company will continue to focus on improving its energy consumption and ESG data processes with tenants to improve the amount of actual (rather than estimated) data utilised in its GHG emissions calculations. This, in turn, supports more accurate emissions reduction tracking and enables YoY comparison to help identified priority sites for EPC assessments.

Going forward, the Company intends to take an iterative approach to scenario analysis as a strategic planning tool over time, as external tools and analytical choices evolve and the Company's analysis further matures. The Company will explore how further changes to its strategy and financial planning may be required in light of this information year-on-year.

Appendix A: Methodology notes for GHG inventory  

Methodology and Assumptions  

The 2024 Conversion Factors published by the UK Department for Energy Security and Net Zero ("DESNZ") was the main source used for emission factors for UK assets (uplifted from AR5 to AR6). Association for Issuing Bodies ("AIB") factors has also been used for residual emissions factors. The Intergovernmental Panel for Climate Change ("IPCC") 2021 factors were used for refrigerant emission factors. For the electricity consumption of newly acquired assets, located in France, International Energy Agency ("IEA") conversion factors have been used. All relevant categories have been included, and any exclusions are described below.  

Scope 1 & 2   

For electricity and natural gas, some actual consumption data was provided for communal areas where energy consumption is controlled by SUPR. Where there were gaps, estimations were made using the data from previous year or floor area intensities (based on similar sites within the portfolio, excluding outliers) as proxies. For fuel oil, spend was used as a proxy due to a lack of activity data.  

Scope 3 (1. Purchased Goods & Services)  

This category was estimated using spend as a proxy and applying Department for Environment, Food & Rural Affairs ("DEFRA") input-output factors kgCO₂/GBP) to expenditure.   

Scope 3 (5. Waste)

Where data was unavailable, this category estimated waste consumption by using waste intensity of a similar site that provided actual data.

Water consumption was estimated for all sites without data. Previously, this estimation was based on the water intensity of one site with data, however the methodology has been updated to use Real Estate Environmental Benchmark ("REEB") water benchmark intensity in FY25.

Scope 3 (6. Business Travel)

This category was estimated using actual business travel data for SUPR employees and applying UK Department for Energy Security and Net Zero ("DESNZ") conversion factors.

Scope 3 (7. Employee Commuting)

This category was estimated using employee commuting survey results data for SUPR employees and applying UK Department for Energy Security and Net Zero ("DESNZ") conversion factors.

Scope 3 (13. Downstream Leased Assets)  

The majority of emissions relate to tenant energy use, particularly for supermarket branches.  All supermarket tenants, provided actual consumption data for electricity, heating and at least partial data on refrigerants. Where no consumption data was available, estimations were made using benchmark intensity data based on floor area.

A smaller amount of emissions arises from the communal areas of sites where the Company owns the land but is not responsible for paying for the energy. These emissions were estimated using the floor area intensities of similar sites with actual data.  

Note on FERA Emissions:

The GHG Inventory figures have removed FERA emissions that are categorised under Scope 3 category 13: Downstream Leased Assets ("DLA") to align with the SBTi minimum boundary alignment. These FERA emissions are associated with the tenants Scope 1 and 2 emissions that are also categorised under Scope 3 DLA. The figures reported in the SECR Report above account for a fuller view of DLA emissions by including FERA emissions under Scope 3 DLA. Therefore, Scope 3 DLA and consequentially, total Scope 3 figures reported in the SECR Report are higher than figures reported for TCFD due to the exclusion of Scope 3 FERA under DLA in TCFD. 

Appendix B: MSCI Tool 

MSCI Physical Risk Model Data Inputs 

Hazard Exposure and Financial Impact