alrosa · 2019-06-06 · oct-13 mar-14 aug-14 jan-15 jul-15 dec-15 may-16 oct-16 apr-17 sep-17...

Moscow, 4-5 June 2019

ALROSAInvestor PresentationSberbank CIB “Russia: The Inside Track”One-on-One Conference

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Table of Content

01. About ALROSA – strategic priorities

02. Market fundamentals

03. Executing to strengthen our business

04. Q1 2019 results

05. Corporate governance

06. Appendix

p.4

p.11

p.22

p.38

p.47

ABOUT ALROSASTRATEGIC PRIORITIES

01

Angola

Australia

Botswana

Canada

Arkhangelsk Region

Republic of Sakha (Yakutia)

Namibia

South Africa

Russian Federation

501. Strategic priorities 05. Corporate governance04. Q1 2019 results03. Executing to strengthen

our business02. Market fundamentals

Leading Position on the Market… where about 70% of global rough diamond output is controlled by BIG-3: ALROSA, De Beers and Rio Tinto

The global diamond reserves base is highly concentrated

with the top 10 countries by reserves volume accounting

for over 95% of total reserves.

Core diamond mines of the BIG-3 market leaders

Countries with the largest diamond reserves

45%

35%

8%

7%5% Russia

Africa

Canada

Australia

Other

About 70% of global rough diamond output is

attributable to BIG-3

26% ALROSA

25% De Beers

13% Rio Tinto

5% Catoca1

3% Petra Diamonds28% Other

143

m ct

Sources: Company’s analysis, Kimberley Process statistics, De Beers and Rio Tinto company data, AWDC Bain report “The Global Diamond Industry 2018”.1. At the moment ALROSA owns 32.8% stake.

6

Sources: Source: Companies data, AWDC Bain report “The Global Diamond Industry 2018”.

ALROSA’s assets geography

High Quality Assets

1,064 m ct Total resources,

including reserves

628 m ct Total reservesAngola

ALROSA owns 41%3 of

Catoca Ltd (Angola)

Open-pit mining

from 8 mines in 2018

Underground mining

from 3 mines in 2018

Alluvial mining from

alluvial deposits in 2018

53%

23%

24%

Republic of Sakha

(Yakutia)

Arkhangelsk

RegionRussian Federation

90%

10%

53%

21%

42% 39%

ALROSA Peer 1 Peer 2 Peer 3

2014 2015 2016 2017 2018

• ALROSA develops world’s largest reserves with strong cost/quality

balance allowing to achieve the highest EBITDA margin in the

industry

• Strong diamond yields delivery of 0.91 ct/t in 2018

• Profitability of assets is one of the highest among peers on a sustainable

level

ALROSA sustainably tops the ranks

as one of the most profitable miners

EBITDA margin, %

1



54%30%

4%1%

11%

Focus on Responsible Mining

7

• Improving industrial safety with focus on prevention

• Structural reform promoting a culture of safety

• Diagnostic and treatment services aimed to promote disclosure and

reduce illnesses

RUB 6 bn1: Support to Local Communities

• Corporate pension fund

• Indigenous people traditions

• Culture & sports

RUB 5.2 bn1: Capex on Environmental Activities

• Reduce CO2 emissions

• Maintain high share – at least 86% - of clean (incl.

renewables) electricity and heat consumption

Charity expenses

Local infrastructure

Healthcare

Education

Other expenses

Health

& Safety

SocialEnvironment

People of

ALROSA

Source: Company data and analysis.1. Based on 2018 figures, excl. sponsorship and social infrastructure maintenance.



0.22 0.5

1.6 1.9

6.3

8.7

DPA Power Metals &

Mining

Transportation Utilities /

Construction

Employee Safety is Our Top PriorityStrong Commitment to Promote a Culture of Safety and Reduce the Number of Accidents

8

Source: Company data and analysis.1. Based on S&P Global: “The Diamond Producers Association Final Results Workshop”.2. ALROSA’s LTIFR as of 2018, peers’ LTIFR as of 2016.

HSE committees at all

management levels

Tailored reporting system

to ensure prompt detection

and response to incidents

HSE supervision at each

stage of production chain

Revised HSE Policy

New approach to control

the flow of production

Regular HSE education

and training sessions

Lost Time Injury Frequency Rate per 200,000 hours

One of the lowest LTIFR compared to the diamond industry and other sectors1

Structural changes Procedures



Superior TSR Compared to Global Peers

9

Source: Bloomberg.Note: Luxury Goods Producers index includes LVMH, Hermes, Richemont, Kering, Swatch, Prada, Tiffany, Tapestry, Burberry, Ralph Lauren, Capri, Moncler and Tod‘s; Diversified Miners, incl. other diamond producers, index includes Anglo American, Rio Tinto, BHP, Glencore, Vale, Gem Diamonds, Petra Diamonds, Lucara Diamond Corp., Firestone Diamonds, Mountain Province Diamonds and Stornoway Diamond Corp. All indices are weighted by market cap on a daily basis.

0%

50%

100%

150%

200%

Oct-13 Mar-14 Aug-14 Jan-15 Jul-15 Dec-15 May-16 Oct-16 Apr-17 Sep-17 Feb-18 Jul-18 Jan-19 Jun-19

Diversified miners, incl.

other diamond

producers

+65.9%

+7.3%

ALROSA

Luxury goods producers+54.4%

Cumulative total USD TSR since ALROSA IPO in October 2013, %



Developing Efficient Organisation...

Journey Ahead

10

…to Maximise Free Cash

Flow and Shareholder

Returns

…and Taking Advantage of

Strong Market Fundamentals…

Focus on Core Business and

Efficiency

Prudent Capital Allocation

Conservative Financial Policy

Unique Product

Growing Demand

Declining Supply



MARKET FUNDAMENTALS

02

Market size 32% 31% 8% 15% 9% 5%

260

1,171

495190 71 50 41 41 23

Personal

luxury

Lux

cars

Hospitality Fine

wines

Fine food Fine art Designer

furniture

Jets &

yachts

Total

2018E

Key Demand Drivers

12

Luxury market valued at c. €1.2 bn is steadily

growing

Jewelry demand comprises 7% of global luxury

market, and 31% of the personal luxury (annual

growth 5%)

Most dynamic growth is concentrated in Asia incl.

Japan and China

Diamond jewelry consumption is correlated with

USA GDP and disposable income

Highlights

3% 5% 6%9%

20%

0%

Europe Americas Japan Rest of Asia China RoW

Global luxury market breakdown in 2018E

€ bn

Source: Bain’s luxury goods worldwide market study (November 2018)1. Trends at constant exchange rates.

Personal luxury market growth1 by region 2018E



Strong Long Term Demand Outlook ...driven by disposable income growth and middle class expansion

13

CAGR 2016-2030F m people over 2016-2030F By region, CAGR range 2016-2030F

Source: Company data and analysis, Euromonitor, AWDC Bain report “The Global Diamond Industry 2018” (December 2018).

7%

6%

2%

1%

3%

Indi

Chin

US

Eur

RoW

3-7%

2-4%

1-4%

1-4%

1-4%52.1

3.5

2.4

24.6

13.7

Lower point refers to base case scenario;

upper point to optimistic scenario

Middle class growth Diamond jewellery demand growth forecastReal disposable income growth



Constrained Supply Outlook Depletion of deposits will result in diamond production declines in the coming years

2018 to 2023 supply forecast – 4 m ct down

14

2019 to 2023 major project capacity changes2

Source: Company data and analysis, brokers’ reports.1. Other includes Zimbabwe and Namibia. 2. Not including ALROSA assets. 3. Stands for De Beers Consolidated Mines, includes Venetia and Voorspoed mines.

1,1

1,2

1,8

1,8

2,3

4,6

(0,9)

(2,9)

(3,5)

(14,0)

Ekati (Dominion Diamond)

Luaxe (Catoca)

Chidliak (De Beers)

Star Orion South (Star Diamond)

Debswana (De Beers)

Argyle (Rio Tinto)

Diavik (Rio Tinto)

Gahcho Kue (De Beers)

DBCM3 (De Beers)

Depletion Expansion

Victor (De Beers)

143 141 144 136 140 139

2018 2019E 2020E 2021E 2022E 2023E

Russia

Botswana

South Africa

Canada

Other1

Congo

AustraliaAngola

m ctm ct

12.8

(21.3)



174

150

139

120

130

140

150

160

170

180

2018 2019E 2020E 2021E 2022E 2023E

Favorable Supply/Demand Fundamentals… will drive the market into a deficit and support positive diamond price pressure

15

Global Supply / Demand balance outlook

m ct

~30

~100

Base case scenario Optimistic scenario

Accumulated diamond deficit in 2019-2023

20% % of annual

production’1870%

m ct

Source: Company data and analysis, AWDC Bain report “The Global Diamond Industry 2018” (December 2018).



Diamonds are Different from Commodities Mature demand and supply discipline result in low price volatility

16

Mature and stable consumer-driven demand

concentrated in developed markets

Consolidated production, supporting

supply discipline

63%

40%

31%

27%

22%

20%

15%

11%

Diamonds

Iron Ore

Aluminium

Coking coal

Nickel

Copper

Silver

Gold

Low price volatility compared to

commodities

11%

33%

14%

36%

22%

18%

34%

16%

Low Price volatility 1 High

Developed markets

67%

Top-3 producers market share, 2018Diamond jewellery retail sales, $, 2017

USA

53%

EU

9%

Japan

5%

China

20%

India

6% RoW

7%

Source: Company data and analysis, AME Research, GFMS, Thomson Reuters, Wood Mackenzie, Bloomberg.1. Calculated as ratio of standard deviation of daily prices to 10 year average price.



Demystifying LGDs

17

Source: Company data and analysis, DPA, Trucost (S&P Global) report “The Socioeconomic and Environmental Impact of Large-Sacle Diamond Mining” (May 2019)

Case study: LGD positioning

by a major player

Fixed price

At ~20% of diamond price

for 1 ct stone

Linear pricing

¼ ct stone price is ¼ of 1 ct

stone price

Standard, commodity-like

colour, size and quality

No specifications other than

size and colour

No grading reports or

certification

Myth: Launch of LGD brand by a major natural

diamond producer endorses LGD as a valid

substitute to natural diamonds

Truth: Differentiated market positioning clearly

illustrates the differences between diamonds and

LGD and will serve as a baseline for LGD

perception by customers and industry players

Myth: LGD and diamonds are identical

Truth: LGD has the same physical and chemical

characteristics as diamonds, but they are not

identical, and they are easily detected using

widely available identification equipment

Myth: FTC ruling stated that LGDs and diamonds

are the same

Truth: For LGDs, FTC guides require businesses to

“disclose clearly and conspicuously that the

product is not a mined diamond”. In fact, in all key

markets LGDs have to be identified as manmade

Myth: LGDs is an eco-friendly and ethical

alternative to diamonds

Truth: Most LGDs are produced in China and India

with coal-generated electricity, the estimated CO2

emissions associated with production of 1 carat

LGD are 3.0x greater vs natural diamond. Over

99% of supplied natural diamonds are conflict free;

proceeds from sales support local communities

and employment

LGD myth #1:

LGD myth #2:LGD myth #4:

LGD myth #3:



1,0x

5,0x 6,0x

c. 10,0x

1970's 1980's 2000's 2010's

LGD: the Future is History Similar scenario has already realised on the market for lab grown sapphires

18

Indexed price per carat of natural

sapphire¹

Indexed to 1975 natural sapphire price

(in nominal terms)

Expert quotes

“Focus of lab-grown gemstones is cheaper low-end jewellery”

Head of Business Development,Gemstone trading company

“We need to convince people that lab-grown gemstones are not fake stones. We operate on market that is separate from natural gemstones”

President,Leading lab-grown gemstones company

“Rarity is a very important factor for consumers, but lab-grown gemstones completely miss it”

Head of Business Development,Leading gemstone mining company

“Lab-grown gemstones do not affect natural market. Easy to distinguish them as they are of perfect quality: too well cut, no inclusions”

President,Gemstone trading company

Source: Company data and analysis, Bain data and analysis, Preciousgemstones.com.1. Sapphire of the highest grade: clarity – LI, colour – 2.5/75 (blue), rough. 2. Price per 1 ct stones of comparable quality (fine-quality).

Gem quality lab grown sapphires first

appeared in 1970s and started commercial

production in 1990s

Market share of lab grown sapphires

stabilised in 2000’s at 15% production share

End-users clearly marked the difference

which is reflected in price-tag for 1 carat

Synthetic production development does not

adversely affect the market for natural stones Natural Lab grown

~$1,500

~$180

Price per carat discount

(2017)2

$/ct

~80-90%

Lab grown stones

production share (2017)

Natural

85%

Lab

grown

15%



Synthetic Stones: Key Marketing Messages

19

Key marketing messages of lab-grown coloured gemstones

(incl. sapphires) producers in 1960-2000s

Source: Company data and analysis.Note: Coloured gem stones messages are based on vintage ads of Chatham Created Gems and Diamonds; Lab-grown messages are based on the message mentions on the websites of Diamond foundry, Chatham Created Gems and Diamonds, Lightbox, NDT, Scio Diamonds and IIA Technologies.

Key marketing messages of LGD producers today

Key marketing messages of lab grown sapphires producers are similar to the ones used now by LGD producers

Key messages are similar, though now lab-grown diamond producers additionally explore

“environmentally-” and “socially-friendly” trend

High quality

Affordable

IdenticalReal

Value Created in AmericaAvailable

Above-groundOwn design

IdenticalAffordable

Guaranteed origin

Created in America

Best of millenials Conflict-free

Eco-friendly

Value

Flexible

Pure

Good investment

Own design

Innovative

Unique

RealDynamic

Rare High quality

Unique InnovativeEthical



Price per

carat ($)

Diamonds and Their Synthetic Substitutes Have Different Price Drivers and Value to Consumers

20

LGD is not the first synthetic alternative to diamonds

Industrial product

Can be produced

in any volume

Highly fragmented

supply, low entry barriers

Product of nature

Rare, unique and

inherently valuable

Highly consolidated

supply, high entry barriers

Price drivers:

Cost

Price drivers:

Rarity

Symbolism

Supply discipline

Natural diamonds

VS

LGD

Moissanite

White Zircon Cubic Zirconia

LGD

Price per

carat ($)$400

$75-100 $20-40

$800

Source: Company data and analysis.



(16)% (18)%

(42)%

~(60)%

(81)%

LGD price discount to natural Lightbox discount to natural

2016 2017 Now2018

Expanding LGD Discount Illustrates DifferentMarket Perception of LGD vs. Diamonds

21

LGD discount to natural diamonds

Price of 1 carat polished diamond: Round, VS clarity, F-H colour

5x

Source: Company data and analysis, Paul Zimnisky report “2018: The Year of the Lab-created Diamond”.



EXECUTING TO STRENGTHEN

OUR BUSINESS

03

52%

20%

32%

37%

43%

ALROSA: the Story of the Industry Leader in 4 ChartsThe largest and most profitable player in the industry

23

Reserves1 Production ‘18 EBITDA ‘18 EBITDA margin ‘18%m ct m ct $ bn

37

35

8

4

18

2.52

1,2

0,2

0,2

0,3

Source: Company data and analysis, Diamond producers’ data.Note: Diamond producers include De Beers, Rio Tinto, Dominion Diamonds, Petra Diamonds. 1. Reserves are as per latest available data. 2. ALROSA’s financial metrics are converted at 2018 average USDRUB rate of 62.54.

628

212

105

43

40

ALROSA

Peer 1

Peer 2

Peer 3

Peer 4

436Inferred

resources



Key Challenges for the Industry

… and how we address them from a value creation perspective

24

• Increasing our marketing efforts to promote

the unique appeal of our product

• Operational efficiency program and culture

• Focus on core business

• Prudent investment program

• Focus on shareholder returns

• Investment in exploration and production development to

maintain reserves base and production

Lack of new deposits, limited

exploration success1

Grade deterioration, cost inflation2Ever increasing competition from

other luxury goods3Rising scrutiny over capital

allocation discipline4



500

750

1 000

1 250

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Superior Exploration Capabilities

Unique full-cycle exploration operations…

25

Field geological exploration

Technological center

(incl. drilling) Scientific research

and analytics

… Backed up by advanced technologies

Complex AerogeophysicalFootage-5

Georadar footage

Radio WaveGeointroscopy

High resolution seismic survey in 3D / 2D

Track record of resource replacement2

Source: Company data and analysis.1. For the period from 2009 to 2018. 2. Based on resources in accordance with the Russian classification.

• Discovered resources: 395 m ct

• Average finding costs of $3.1 per ct1

+395 m ct

With exploration works

m ct

… result in solid track record of resource replenishment at low finding costs



2,5 3,7 4,6 5,6 5,5 5,53,4 2,9 2,8

2,8 2,6 3,3

9,0 6,5 5,4 5,2 4,8 4,5

6,2

4,9 6,0 3,7 3,8 3,6

1,54,1 3,7

4,1 3,8 4,1

3,6 3,9 4,24,8 5,1 5,0

0,2 1,8 2,0 1,9 1,8 1,8

5,45,1 5,1 5,0 5,0 5,0

4,85,1 4,9 4,7 5,0 4,8

2018 2019E 2020E 2021E 2022E 2023E 2024-30E

Stable Production Outlook

26

Production outlook m ct


• Development of new projects/debottlenecking:

- V. Munskoye deposit: +c.2.0 m ct – full ramp-up by ‘20

- Udachny underground mine: +c.3.0 m ct – full ramp-

up by ‘21

- Severalmaz: +c.1.4 m ct (debottlenecking) from ‘21-22

- Nyurba division: +c.2 m ct (debottlenecking) in ‘19-20

• Decline in diamond output:

- Jubilee: -1.5 m ct from ’19 (due to production at

kimberlites with a lower grade)

- International underground mine: decrease in ’18-’22

due to mining and geological conditions

Key drivers

…supported by development of new projects and debottlenecking

36.738.0 38.7 37.7 37.4 37.6 37-38

Average Grade,

carats per tonne

Almazy Anabara

Verkhne-Munskoye

Severalmaz

Nyurbinskaya

Jubilee

International

Udachny

Other

0.9 0.9 0.9 0.9 0.9 0.9 0.9

Botuobinskaya



27

Focus on Value Accretive Capex

Capex dynamics Key projects

Mining capacity

Total 2019-24 Capex – RUB 40 bn

Completion of Udachny underground mine construction

Completion of Verkhne-Munskoye diamond deposit development

Construction of Maiskaya pipe

Construction of Zaria pipe

Equipment maintenance


Infrastructure


Reconstruction of Mirny Airport: total Capex – ~RUB 10 bn to be invested in 2018-22

Gasification of production facilities in Udachny: total Capex – RUB 4.6 bn to be invested in

2019-23

Organization of production site for the needs of USO: total Capex – RUB 5.3 bn to be

invested in 2019-20

Construction of gas processing facility by “ALROSA-Gaz” (JSC): total Capex – RUB 2.7 bn to

be invested in 2018-21

Capex:

Investment program with target IRR1 of 20%+

RUB bn

9 8 8 9 810 10 9 10

17

1417

1111 6

52

5

6

5

2

98 11

5

4

3

32

27 28 2926

28

20

15

18

2016 2017 2018 2019E 2020E 2021E 2022E 2023E 2024E

Infrastructure

Mining

capacity

Equipment

maintenance

Source: Company data and analysis.1. For investments in new mining capacity and operational efficiency projects.

Capital-intensive phase is over



143

187

105

53

42

8

2017 2018 2019E

Focus on Efficiency Dedicated operating efficiency program launched in 2017

28

Scaling up initiatives

Number of Initiatives

Delivering tangible results

General and administrative expenses, RUB bn

Source: Company data and analysis.1. Include payroll and other employee payments, fuel and energy, materials, external services and transportation, other production costs.

2. Labour costs, services and transportation are adjusted based on CPI. Material costs, fuel and energy are adjusted based on respective price indexes.

3. Calculated based on CPI, excl. impairment of receivables.

Key initiatives

Optimisation of ore beneficiation and

separation processes

Restructuring of construction and

geological exploration units

Implementation of centralised

management and usage-based

approach for transportation

Labour productivity increase

G&A optimisation

Other

Operating improvements

G&A

Energy efficiency

208

Nominal Unit Costs 1, k RUB/m3

1.121.151.16

Real terms2

YoY change, %(8%) (5%) (2%)

2016 2017 2018 LT Target

(Real)

Real terms3

YoY change, %(10%) (2%)

11.6 11.712.4

2016 2017 2018

As % of

revenue4% 4% 4%



Case Study: Operational Turnaround Program at NyurbaNyurba’s success can be replicated and scaled up across other divisions

Key streams and initiatives

Improving mine fleet dispatching

processes by SIC1 procedures

implementation

Optimizing OEE2 by reducing

non-value added operations

Optimizing maintenance and repairs

operations will lead to improved

equipment availability and

… improved plant availability

Increasing hourly throughput by

optimizing ore blending processes

29

Run of mine Diamond production growth

1719

Overall equipment efficiency

+10%

51%63%

+12 p.p.

Processing

2018 2019E

2.1 2.4

+14%

m ct

Source: Company data and analysis.1. Short interval control. 2. OEE – overall equipment efficiency.

+26%

7,7

9,19,7

2018 2019E 2020E

m m3

%

mt



Case study: Automotive Transport OptimizationCentralization and usage-based approach provide long-term cost cutting effect

30

Key streams and initiatives

Number of vehicles went down

following implementation of new

processes and tools: usage-based

approach to vehicles request and

utilization, route optimization and

reduction of fleet renewal

program

Revision of organizational

structure and headcount

optimization

Shift to natural gas from gasoline

and diesel leads to decreased fuel

cost decline and reduced

emissions

Cumulative effect in cost cutting

3 923

3 280

RUB mn, expenses related to transportation

Cost saving:

RUB 643mn

2018 2019E

Units

1 240791

(36%)

m tn

FTE

%

3859

+55%

1 715 1 389

(19%)

2018 2019E

8,093 5,7691,376

684

9,4696,453

(32%)

Gasoline

Diesel

Number of vehicles

Vehicles utilization factor

Headcount

Fuel

(16%)




78

64

2017

2018

(14)

8,8

7,1

(1.7)

902

804

(98)

Case Study: Working Capital ManagementReduction in rough diamond WIP inventory days

Optimization levers

31

Reduction of diamonds WIP1 cycle

Production Chain of Rough Diamonds

Final sorting

and box

assembly

Preliminary

sorting

Final

RecoveryMine

WIP Cycle

Inventory

7

6

7

14 34

initiatives

Decrease in average

WIP Cycle

Number of days $ mnm ct

… leading to lower rough diamond

WIP inventory by Volume

… and by Value2

Key enablers

Team and capability development

Productivity monitoring and benchmarking

New productivity based motivation system

IT systems upgrade

Downtime reduction

Workflow optimisation

New analytics and modelling

Process automation

Source: Company data and analysis.1. Rough diamonds before sorting is completed. Does not include +10.8 ct and industrial grade diamonds.2. Based on prices of diamonds set by reference to price lists approved by the Ministry of Finance of the Russian Federation.



32

1.8

2.1

2.4

2014 2018 Target

2024E

Employee Training and Development System


k m3 of run-of-mine ore per employee

Key initiatives and programmes Labour productivity growth

… to further improve long term competitiveness and productivity

+17%

+12%

Revision and simplification of remuneration system

to increase transparency and link it to performance

Launch of share-based incentive program to retain

top management and align their interests with

shareholders

Implementation of a multi-stage competency

assessment system for the selection and

professional development of the talent pool

members

Development of in-house corporate educational

system covering various grades and business

divisions

Implementation of internal coaching and mentoring

programmes

Development

of talent pool

Improvement

of remuneration

system

Establishment

of Corporate

University



33

Source: Company data.

Marketing Strategic Initiatives and Ongoing Digitalization

Industry initiative

• Participation in pilot projects involving M2M

and Tracr tracing platforms

• Implementation of digital twin technology

providing detailed information about each

stone

• Development of digital platform for online

sales

Ongoing digitalization in ALROSA

Generic

(category)

marketing

• Participation in DPA to promote the integrity

and reputation of natural diamonds

• Differentiation of natural diamonds and

LGDs markets driven by rarity, uniqueness

and inherent value of natural diamonds

Promotion of

different

assortment

categories

• Active promotion of fluorescent diamonds to

stimulate demand in B2C segment

• Marketing initiatives to improve broader

sentiment towards fluorescent diamonds

Marketing of

diamond

collections

• Promotion of large, exceptional quality

diamonds

• Promotion of fancy coloured diamonds

Introduction

of digital

marketing

Adoption of

best practices

in operational

digitalization

Digital

Mine

Virtual

Reality

Unmanned

Technologies

Drill-and-blast

Automation

Big Data Driven

Predictive Maintenance



Company initiatives

34


Diamond Producers Association

Key initiatives DPA marketing campaigns by regions



6%

20%

21%

53%

N. America (USA from 2016)

India (from 2017)

Asia Pacific ex. Japan (China from 2018)

RoW

% represents share of a region in global jewelry consumption

Marketing budget of the industry association growth

$ m

10

60 6070

2016 2017 2018 2019E

Diamond Producers Association (DPA) formed by 7 major diamond

producers in 2015 supports the development of the diamond sector

through promotion of reputation of diamonds

Marketing campaigns with a tagline “Real is Rare. Real is a Diamond”

launched in the US (2016) and in India (2017)

DPA’s activities include:

paid advertisement on TV, internet, cinema, social networks

promotion in social media by social influencers

participation in industry events

work with industry and non-industry organizations

market surveys and research

In 2018 DPA’s activities expanded into China (while continued in the US

and India)

New marketing campaign addressed to women who purchase

diamonds for themselves is called “From Me, To Me”, launched in mid-

September 2018

35

Capital Allocation – Key Principles and Policy Overview

Operating

Efficiency

Organic Growth

Focus on Core

Business

Conservative

Financial Policy

Strong Liquidity Position

Commitment to

Balanced Debt Profile

Maximising Shareholder Returns

Prudent Capital

Allocation

Investment Program

with 20%+ IRR1

FCF-linked

Dividend Policy

Divestiture of

Non-core Assets

1. For investments in new mining capacity and operational efficiency projects.



Baa2

(Stable)

BBB-

(Stable)

BBB-

(Stable)

36


2,623

1,048

3,671

31-Mar-2019

• Maintain conservative debt profile in line with investment grade

criteria

• Target Net Debt / EBITDA range: 0.5-1.0х

• Liquidity reserves of >RUB 35 bn (committed credit lines and cash)

• Natural FX hedge – financial liabilities are matched with income streams

• Solid public debt track record with fixed-income investors

$ m

$ m $ m

Investment grade credit rating Net Debt evolution to investment grade credit ratings

Conservative long-term financial targets Liquidity position Debt repayment schedule

3,9513,119 2,781

1,374 1,494971

522

1.9x 1.9x 1.7x

0.5x 0.7x0.4x 0.2x

2013 2014 2015 2016 2017 2018 Q1'19

Net Debt Net Debt / Adjusted EBITDA (RUB denominated)

Cash and

cash equivalents

(incl. deposits)

Uncommitted

Credit Lines

Strong Balance Sheet… with leverage at historic-lows

647896

10 11 6

2019E 2020E 2021E 2022E 2023E

Eurobonds Bank Loans



311190 244

1,110

1,281

0.04

0.030.03

0.15

0.17

0,00

0,02

0,04

0,06

0,08

0,10

0,12

0,14

0,16

0,18

0

200

400

600

800

1 000

1 200

1 400

2014 2015 2016 2017 2018

37

Dividend Policy Focused on Maximisation of Shareholder Returns

Historical dividend payments 1 Dividend policy overview

Dividend

Base

Net debt /

EBITDA < 0.0x

0.0x < Net Debt /

EBITDA < 1.0x

1.0x < Net Debt /

EBITDA < 1.5xConditions

Payout Ratio

Subject to minimum dividend payout of 50% of IFRS net income

100+% 70–100% 50–70%

Frequency Semi-annual

FCF

$ mn

$ per share

Source: Company data and analysis.1. Based on FX rate as of the dividend record date. Dividends paid , based on FY2018 IFES numbers

H1’18

12M’17



Q1 2019RESULTS

04

1,556

1,034 933 802 969

26

2316

2218

1,582

1,057949

824988

Q1'18 Q2'18 Q3'18 Q4'18 Q1'18

Industrial quality diamonds Gem-quality diamonds

Sales

39

Q1 2019 Sales

Diamond sales increased by 1.6 m carats (18% q-

o-q) to 10.6 m carats due to increased small-size

diamond sales driven by seasonal restocking by

dealers and retailers

Sales were up 20% q-o-q to USD 988 m (down

37% y-o-y) due to a larger share in small-size

diamonds

12M 2018 Sales

Diamond sales were 38.1 m carats (down 8% y-o-

y), while

… diamond sales in value terms rose by 6% to

USD 4.4 bn on the back of stronger prices and

improved mix of gem-quality diamonds

Highlights Diamond sales in carats

$ m


Diamond sales in U.S. dollars



m ct

10.16.3 4.7 5.3

7.9

3.2

2.72.0

3.72.7

13.4

9.0

6.79.0

10.6

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

Industrial quality diamonds Gem-quality diamonds

Increase in diamond sales

30.1 26.4

11.111.7

41.238.1

12M'17 12M'18

4,085 4,325

8587

4,170 4,412

12M'17 12M'18

5.710.1

17.2

7.5 7.8

1.30 0.84 0.611.38 1.23

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

Grade, cpt

Output

40

Q1 2019

Production was down 24% q-o-q to 7.8 m ct

mostly due to a decrease in output at the

International and Aikhal UG mines and the Jubilee

pipe

Av. grade went down by 11% q-o-q to 1.23 cpt

12M 2018

The volume of processed ore and gravels grew by

3% to 40.5 m t mainly due to increased gravel

processing at Almazy Anabara alluvial deposits (up

8%) and Mirny Division (up 10%)

Production declined by 7% to 36.7 m ct due to the

shutdown of the Mir UG mine and the completion

of open-pit mining at the Udachnaya pipe

Av. diamond grade was 0.91 cpt

Highlights Ore and sands processing

m ct


Diamond production



m t

5.3 4.1 3.86.5 6.1

2.02.1

1.0

3.31.50.2 2.3 5.8

0.5

0.27.4

8.5

10.5 10.3

7.8

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

Open pit Underground Alluvials

39.1 40.5

1.01 0.91

12М'17 12М'18

21.1 19.7

10.68.4

8.08.7

39.636.7

12М'17 12М'18

Q1 2019: increase in diamond production

1,260

1,514

2017 2018

718

342242 215

395

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

41

Q1 2019:

Revenue came in at $1.1 bn (up 17% qoq) due to

increase of diamond sales in carats. 36% yoy

decrease was driven by reduction of diamond sales

in carats and a weaker sales mix

EBITDA was up 18% qoq to $0.5 bn on increased

diamond sales and cost control. 43% yoy decrease

was driven by revenue decline

EBITDA margin stood at 44% (down 6 p.p. yoy)

Net income stood at $0.4 bn (up 3.0x qoq, down

37% yoy)

FCF increased by 84% qoq to $0.4 bn (down 53%

yoy)

Net debt / EBITDA stood at 0.2x

Highlights Superior profitability

$ m


Strong Free Cash Flow generation



$ bn

Resilient financial performance with strong margins and positive free cash flow

Key Financials

1.71.2 1.1 0.9 1.1

0.80.7 0.6

0.4 0.5

50%57% 57%

44% 44%

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

Revenue EBITDA EBITDA margin

4.7 4.82.2

2.5

46%52%

2017 2018

6%22%

(23%) (19%)

154 164 199

153 123

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

Price Dynamics

42

In Q1 ‘19 average price index decreased by 3.1%

mainly due to oversupply in the diamond market,

weaker Indian rupee and limited access to

affordable financing for mid-stream in India

Q1 ’19 average selling prices of gem-quality

diamonds decreased by 19% qoq (down 20% yoy)

to $123/ct due to a larger share of small-size

diamonds and lower prices mostly for medium-size

diamonds

In 2018 average price index gained 2.9% (following

a 3.4% gain in 2017)

Due to better sales mix, 12M ’18 average selling

prices1 grew by 21% and reached $164/ct

Highlights Price index for gem-quality diamonds

$/ct

Source: Company data and analysis.1. Average selling prices (sales revenue divided by sales volumes in carat terms) are also impacted by changes in the product mix throughout the reported period.2. Average index change of like-for-like diamonds prices (excl. +10.8 carats)

Average selling price1 for gem-quality diamonds

(2%) (1%) (12%) (9%)

21%

175 172 170 149 136

164

2013 2014 2015 2016 2017 2018

Price change

3%

(5%) (8%)

3% 3%

1.00 1.03 0.970.90 0.93 0.95

2013 2014 2015 2016 2017 2018

Average index change2



2% 2%

(2%) (3%)

1.00 1.02 1.04 1.02 0.99

Q1'18 Q2'18 Q3'18 Q4'18 Q1'19

Average price index

53 64

26(13) (2) (0.5)

Q4'18

Revenue

Volume Sales

mix

Pricing

like-for-like

FX Q1'19

Revenue

Sales Update

43

Q1‘19 gem-quality diamond sales were up by 20%

qoq to RUB 64 bn driven by:

(+) 18% increase in sales volumes (in carats)

(-) weaker product mix

(-) softer LFL prices (av. index change – -3%)

(-) FX rate impact on stronger RUB

2018 revenue grew by 8% driven by stronger gem-

quality diamond sales

Highlights Q1 2019 gem-quality rough diamond revenue bridge

RUB bn

RUB bn

Source: Company data and analysis.1. Prices of diamonds are set by reference to price lists approved by the Ministry of Finance of the Russian Federation.

2017-2018 gem-quality rough diamond revenue bridge



238267

(30)

40

4 14

2017

Revenue

Volume Sales

mix

Pricing

like-for-like

FX 2018

Revenue

Profitability Analysis

44

Q1‘19 EBITDA was up by 16% qoq driven by:

(+) 18% increase in cts sales: impact RUB 26 bn

(-) sales mix: impact RUB 13 bn

(-) like-for-like prices: impact RUB 2 bn

(-) FX rate impact RUB 0.4 bn

(-) other factors: total impact RUB 6 bn

Q1 ‘19 EBITDA was down by 34% yoy driven by:

(-) 21% reduction in cts sales: impact RUB 21 bn

(-) sales mix: impact RUB 10 bn

(-) like-for-like prices: impact RUB 4 bn

(+) FX rate impact RUB 8 bn

(+) other factors: total impact RUB 10 bn




27 31

26(13)

(2) (0.4)(6)

Q4'18

EBITDA

Sales

volume

Sales

mix

Pricing

like-for-like

FX Other Q1'19

EBITDA

RUB bn

Q1 2019 EBITDA – key drivers (yoy)

Q1 2019 EBITDA – key drivers (qoq)

RUB bn

Highlights

4831

8

10(21)

(10) (4)

Q1'18

EBITDA

Sales

volume

Sales

mix

Pricing

like-for-like

FX Other Q1'19

EBITDA

Free Cash Flow and Total Debt Analysis

45

Q1 2019 EBITDA to Free Cash Flow bridge

RUB bn

Source: Company data and analysis.1. Mainly includes changes in FX, finance income/expense, income from grands, insurance reimbursement etc.

Q1 2019 Total debt bridge

RUB bn



0.4x

33.8

67.5

67.8

(6.2)

(1.6)

28.6

(25.9)

39.2

101.6

106.7

Total debt

Q1'19

Other

Sale

of assets

Liquidity

changes

FCF

Total Debt

4Q'18

Net debt Cash and cash equivalents (incl. deposits)

ND / EBITDA

0.2x

1

31.4

3.6

(5.1)

(0.2)

29.7

(3.9)

25.9

EBITDA

Changes

in NWC

Income tax

Other

Operating

cash flow

Capex

Free cash flow

Outlook

46

Market outlook ALROSA operating performance



Underlying demand for diamond jewellery demonstrates

positive dynamics while escalation of trade tensions could

weigh negatively on the growth rates

Overall diamond stocks are expected to remain flat at mid-

stream, as Indian mid-streamers continue to face difficulties

with access to affordable financing

Global diamonds supply continues to decrease

Production outlook for 2019 remains unchanged at 38 m ct

(+1.3 m ct yoy) on continued ramp-up of Verkhne-

Munskoye and Severalmaz

Grades are expected to stabilize at 0.9 ct/t

Production mix and sales mix are expected to normalize

following sale of higher grade stocks in the first half of 2018

CORPORATE GOVERNANCE

05




Increased share of INEDs in the Board of Directors

Number of Members

2

4

13

11

2014

Now

Independent Nominees of RF and Yakutia

6 – Russian Federation

4 – Republic of Yakutia

1 – Local Communities of Yakutia

INEDs represent 100% in Audit and 75% in RemCo committees

Number of Members

Strategy with

3 INEDs

out of 13

RemCo

Committee –

3 INEDs out of 4

Audit – 3 INEDs out of 3

Chaired by INEDs

Corporate Governance and Shareholder Support

• Regular and transparent disclosure and commitment to best in class

corporate governance practices

• New initiatives are under way:

‒ Corporate Strategy till 2024

‒ HR Strategy with the overhaul of the organization structure and

motivation schemes (stock option program is one of the initiatives)

‒ Introduction of a long-term incentive plan linked to total shareholder

return (TSR) targets to align management and shareholder interests

and provide incentives for sustainable long-term development

‒ Approval of new HSE policy, aimed to promote a culture of safety

Commitment to improving standards of corporate governance

1

Current Board has Supported Initiatives to Improve Alignment of Shareholder Interests

49

HSE strategy

Approval of new HSE policy, aimed to promote a

culture of safety.

New management team

New senior management team with tenured

professionals committed to increase shareholders

return and modernise ALROSA’s corporate

structure and operations.

New clear financial and dividend policy

Financial policy to ensure an appropriate balance

between capital structure and liquidity at hand.

New clearly articulated semi-annual dividend

policy based on FCF and target leverage.

Transparency and disclosure

Commitment to regular and transparent disclosure

of operational and financial results and publishing

of social and environmental report.

Long-term incentive plan

Introduction of a long-term incentive plan linked to

a set of financial, operational and total shareholder

return (TSR) targets to align management and

shareholder interests



Board Agenda for 2019-2020

50

Highlight long-term strategic issues in marketing

Active engagement with all stakeholders

Emphasis on developing risk management culture within the company

Reform of HR and pay structure

Focus on continuous business transformation to ensure long-term

competitiveness and sustainable production1

2

3

4

5



APPENDIX

06

52

Key Investment Projects

Udachny

UG mine

VM1

deposit

Zaria

pipe

Maiskaya

pipe

VG2

deposit

Type of mining Underground Open-pit Open-pit Open-pit Alluvials

Production start 2014 2018 2020 2025 2022

Ramp-up 2021 2020 2021 2027 2022

Target ore output pa, m t 4.0 3.0 1.2 0.3 1.1

Target production pa, m ct 5.6 1.8 0.4 1.2 0.4

Total CAPEX, RUB bn 63.9 25.0 8.4 5.6 2.3

Invested share 85% 69% 77% 1% 0%

Resource base3, m ct 207.6 40.4 7.1 12.7 4.7

Source: Company data1. Verkhne-Munskoye deposit2. Vodorazdelnye Galechniki deposit3. Diamond mineral resources in accordance with the JORC Code as at 1 July 2018

Yakutsk

Mirny

Udachny

Aikhal

1 2 3 4 5

1

2

3

4

Nyurba5

Yakutia

53

Projects Under Consideration

Jubilee UG mine Mir UG mine

Type of mining Underground Underground

Ramp-up (preliminarily) 2032 2031-32

Target ore output pa, m t 1.8 1.3

Target production pa, m ct 2.3 3.8

Total CAPEX, RUB bn ~72 ~73

Invested, % 0% 0%

Reserve base1, m ct ~43.2 ~68.6

Project IRR Up to 20% 18.3%

Source: Company data1. Subject to further exploration

Yakutsk

Mirny

Aikhal

1 2

1

2

Decision on the mines construction will be taken after the feasibility studies will be completed, all numbers are indicative and based on preliminary estimate

Yakutia

54

1. Long-term agreements which provide stable sales and predictable prices

during volatility on diamond market (strategy generates ~70% of

ALROSA's rough diamond sales)

2. Largest jewellery chain stores:

3. Competitive sales via auction and tenders

4. Spot sales pursuant to one-off contract arrangers

5. Sales through Russian government entities – Almaziuvelirexport and

Gokhran of Russia

ALROSA’s geography of sales1 based on clients legal residences

number of long-term clients as of January 2019

47%

15%

10%

12%

10%

4% 2%Belgium

India

Israel

Russia

UAE

China

Other4

7

1

9

18

4

24

ALROSA’s rough diamond sales channel breakdown

18%

64% 71% ~70%

72%

17%12% 10-20%

10%19% 17% 10-20%

2006-2008 2012-2014 2015-2016 Long-term

Tenders

Spot sales

Long-term contracts

Sales Structure and ChannelsMultichannel distribution with growing focus on long-term contracts

Overview of sales channels

Source: Company data and analysis

88% of ALROSA’s diamond sales

accounted for exports1

98% / 70% of ALROSA’s diamond sales / volume

generated by sales of

gem-quality rough

7.3 7.5 7.37.0 7.56.7

2016 2017 2018E

Production Sales

55

Expansion to AfricaPromising region with high exploration potential

Production and sales, m ct

255 300

350+

2016 2017 2018E

Axis

Tit

le

Improved financial performance at Catoca Development of Luele pipe

Luale kimberlite pipe is the largest diamond discovery over the past 60

years

The project is operated by Luaxe consortium

Exploration activities

Kimang JV (Angola):

‒ 50/50% JV between ALROSA and Endiama

‒ Exploration activities in Quango area, the North of Central Angola

‒ Awaiting exploration license approval for Chisombo area

Zimbabwe:

‒ Strategic partnership with the government of Zimbabwe

‒ Selection of potential targets for exploration study

The pipe development plan to be approved by the end of 2019

Resource base: 350 m ct

Expected average grade: 0.95 ct/t

EBITDA, $ mn

Catoca in numbers:

‒ Total reserves ~ 120 m ct // 2 processing plants with 13 m t pa // 0.61 ct/t

Recent corporate governance improvements:

‒ Supervisory & Fiscal committees authorized to review and approve contracts

‒ Appointment of executive directors to be approved by Supervisory committee

‒ Rotation between ALROSA and Endiama in appointing CEO and CFO

Change in sales practices:

‒ New approach to sale channels diversification following reform in Angola’s

diamond industry has already resulted in double-digit growth of diamond prices

$84/ct $89/ct $110/ct


56

Focus on Core Business with “Back to Basics” Approach

5,341652

271

463

17

30,300

3,200

2013 2014 2015 2016 2017 2018 Q1'19

47

3934 32 31 29 27

2013 2014 2015 2016 2017 2018 Q1'19

Program to divest non-core assets started in 2013 includes assets

in real estate, energy (gas) farming, insurance, etc.

The program is planned to be completed by 2020

Number of non-core entities was down by 40% from 2013

Q1 2019 proceeds from divestments were RUB 3.2 bn:

disposal of non-core assets for RUB 1.6 bn (the most significant

transaction – sale of 100% stake in JSC Golubaya Volna Resort

for RUB 1.2 bn

disposal of property by LLC Innovation Centre Bourevestnik for

RUB 1.6 bn

Total proceeds from divestments were RUB 37 bn in 2013-2018:

80% of total proceeds came from the sale of gas assets in

Q1 2018 to NOVATEK

Another significant divestment was sale by ALROSA of 51%

stake in Timir, iron ore producer, to EVRAZ in 2013 for total

consideration of RUB 4.95 bn

RUB m

Proceeds from sale of non-core assets

Number of ALROSA’s subsidiaries

1

Source: Company data1. Excluding ALROSA Finance BV, ALROSA Finance SA, Wargan Holdings Limited (finance entities) and ALROSA Overseas SA (holding company)

86%

14%

Creating a clearer and sustainable environment

57


1. Include PJSC ALROSA’s diamond production assets and the Heat and power supply company, which was removed from PJSC “ALROSA” structure starting from 01.01.2017 and became its subsidiary PTWS LLC.

Over the past two years, ALROSA has reduced CO2

emissions by c.20%

Already impressive share of clean electricity and heat

consumption of 86%

Efficient disclosure is acknowledged by ESG ratings:

‒ 3rd place (out of 33) in the “First rating of environmental

performance of mining companies in Russia”

‒ Rated among top-10 Russian companies with

transparent corporate reporting according to

Transparency International-Russia research

Share of clean electricity and heat consumption Other

1 067 1 064

858

2016 2017 2018

2018

Latest developments Reduction of CO2 emissions1

ths tonnes

Share of clean (incl. renewable) electricity and heat consumption

58

Profit Curve of Existing Diamond Mines

Tier-2 performing mines (2nd quartile, 25-50%)

Tier-4 performing mines (4th quartile, 75-100%)

(Price per ct - Cash Cost per ct), $

(Price per ct - Cash Cost per ct), $ (Price per ct - Cash Cost per ct), $

Source: Company data and analysis.Note: Assessment of 2017 production.

(Price per ct - Cash Cost per ct), $

Tier-1 performing mines (1st quartile, 0-25%)

Tier-3 performing mines (3rd quartile, 50-75%)

Margin per carat by mines

FX Rate

59


Financial metrics breakdown by currency

% of metric's total ALROSA is an exporter with 95% of revenue denominated in USD

Major portion (74%) of costs and capex is denominated in RUB

95% of the Company’s debt portfolio is denominated in USD to

create a natural hedge against FX risks

ALROSA's financial sensitivity analysis shows that a change in the

USD exchange rate by +/- 1 RUB/USD leads to the following

change in metrics:

‒ revenue – +/-1.42%

‒ cost of sales – +/-0.23%

‒ EBITDA – +/-2.91%

‒ capex – +/-0.39%

RUB

USD

95%

15%26%

59%

95%

5%

85%74%

41%

5%

Revenue Cost of sales Capex Cash and cash

equivalents

(incl. bank

deposits)

Total

debt

60

Alexey Kovalenko

Director, Mirny mining and processing division• Joined the Company in 1996• Over 20 years of industry experience

Roman Deniskin

Director, Udachny mining and processing division• Joined the Company in 2019• Over 15 years of industry experience

Evgeniy Denisov

Director, Aikhal mining and processing division• Joined the Company in 2005• Over 15 years of industry experience

Anatoliy Platonov

Director, Nyurba mining and processing division• Joined the Company in 1992• Over 25 years of industry experience

Pavel Marinychev

CEO Almazy Anabara• Joined the Company in 2016• First deputy Prime Minister of the Republic of Sakha (Yakutia) (2014‒2016)• Deputy Prime Minister of the Republic of Sakha (Yakutia) (2010‒2014)

Andrey Pismenny

CEO Severalmaz• Joined the Company in 1997• Over 20 years of industry experience• Chief engineer of ALROSA in 2010‒2015

CEO

CO

OC

FO

Sale

s

Sergey Ivanov

Chief Executive Officer

• Joined the Company in 2017• Senior Vice President at Sberbank of Russia (2016‒2017)• Chairman of the Management Board of SOGAZ (2011‒2016)• Top management positions at Gazprombank (2005‒2011)

Alexey Philippovskiy

Deputy CEO – Chief Financial Officer

• Joined the Company in 2017• CFO of Siberian Generating Company (2015–2017)• Head of Finance and Economics and then CFO of Sibur (2004–2013)• Consultant at McKinsey & Co. (2001–2004)

Management TeamCommitted to deliver on ALROSA’s development plans

Mir

ny

Div

isio

n

Ud

ach

ny

Div

isio

n

Aik

hal

Div

isio

n

Nyu

rba

Div

isio

n

Alm

azy

An

ab

ara

Severa

lmaz

Executive team Operational team

Igor Sobolev

First Deputy CEO – Chief Operating Officer

• Joined the Company in 2007• Head of Capital construction division, mining & metallurgical

directorate at Norilsk Nickel (2000‒2007)

Yuri OkoyomovDeputy CEO for Sales

• Joined the Company in 1993• Vice President of ALROSA for marketing and sales since

August 2009


61

Supervisory Board Overview


Anton Siluanov

First Deputy Chairman of the Government

of the Russian Federation

Aysen Nikolaev

Head of the Republic of Sakha (Yakutia)

Nikolay Alexandrov

First Deputy Head of Suntarsky Ulus

Municipal District of the Republic of Sakha

(Yakutia)

Vladimir Solodov

Chairman of the Government of the


Nominated by: the Russian Federation Nominated by: the Republic of Sakha (Yakutia) Nominated by: Municipal Districts of the Republic of Sakha

(Yakutia)

Nominated by: the Republic of Sakha (Yakutia)

Previously held positions include:

• 2005-2011 – Deputy Minister of Finance of the Russian

Federation

• Since 2011 – Minister of Finance of the Russian

Federation

• Since 2018 – First Deputy Chairman of the Government

of the Russian Federation


• 2012-2018 – Head of the urban district ”City of

Yakutsk”

• Since 2018 – Head of the Republic of Sakha (Yakutia)


• 2009-2015 – Specialist, Senior Specialist, Leading

Specialist, Head of water transport Department of

Ministry of Transport and Road Infrastructure of the


• 2015-2016 – General Director of the state-run

enterprise of the Republic of Sakha (Yakutia) “Arctic

Transportation Company”

• Since 2017 – First Deputy Head of Suntarsky Ulus

Municipal District of the Republic of Sakha (Yakutia)


• 2013-2015 – Head of department in Agency of

Strategic Initiatives

• 2015-2018 – Deputy Plenipotentiary Representative of

the President of the Russian Federation in the Far

Eastern Federal District

• Since 2018 – Chairman of the Government of the


Alexey Chekunkov

CEO of Far East and Baikal Region

Development Fund

Kirill Dmitriev

CEO of Russian Direct Investment Fund

Oleg Fedorov

Independent director of the Supervisory

Board, ALROSA

Maria Gordon


Board, ALROSA

Nominated by: the Russian Federation Nominated by: the Russian Federation Nominated by: minority shareholders as an independent

director

Nominated by: minority shareholders as an independent

director


• 2009-2011 – Head of New Nations Capital Investment

Company

• 2011-2013 – Director, member of the board, member

of investment committee of the Russian Direct

Investment Fund

• Since 2014 – General Director of the Far East

Development Fund


• 2007-2011 – Development Director, President of Icon

Private Equity Limited Representative Office

• Since 2011 – CEO of Russian Direct Investment Fund


• 2009-2012 – Head, Department of Investment and

Banking, VTB Capital

• 2012-2014 – Adviser to the Head of the Federal

Agency for State Property Management

• Since 2013 – Independent director of the Supervisory

Board of ALROSA


• 1998-2010 – Goldman Sachs, investment activity

• 2010-2014 – PIMCO, investment activity


Board of ALROSA

21

6

3

5 7 8

4

62

Supervisory Board Overview


Sergey Mestnikov

CEO of Trust Fund for Future Generations

of the Republic of Sakha (Yakutia)

Alexey Moiseev

Deputy Minister of Finance of the Russian

Federation

Ilya Yelizarov

Assistant Head of the Federal Agency for

State Property Management

(Rosimushchestvo)

Nominated by: the Republic of Sakha (Yakutia) Nominated by: the Russian Federation Nominated by: the Russian Federation


• 2010-2012 – Deputy Head, Head, Secretariat of Chairman

of the Government of the Republic of Sakha (Yakutia)

• 2012-2016 – First Deputy Minister of Property and Land

Relations of the Republic of Sakha (Yakutia)

• Since 2016 – CEO of Trust Fund for Future Generations of

the Republic of Sakha (Yakutia)


• 2001-2010 – Senior Economist, Deputy Head of

Analytical Department of Renaissance Capital -

Financial Consultant

• 2010-2012 – Deputy Head of Department, Head of

Division at VTB Capital

• Since 2012 – Deputy Minister of Finance of the Russian

Federation


• 2010-2012 – Referent of the Department of the

Presidential Experts' Directorate, Assistant Head of

Presidential Administration

• 2012-2015 – Assistant Chairman of the Government of

the Russian Federation

• Since 2017 – Assistant Head of the Federal Agency for

State Property Management (Rosimushchestvo)

Evgenia Grigorieva

Minister of Property and Land Relations of

the Republic of Sakha (Yakutia)

Sergey Ivanov

Chief Executive Officer of ALROSA

Dmitry Konov

Member of the Board of Directors,

Chairman of the Management Board

at SIBUR Holding

Galina Makarova


Board, ALROSA

Nominated by: the Republic of Sakha (Yakutia) Nominated by: the Russian Federation Nominated by: the Russian Federation as an independent

director

Nominated by: the Republic of Sakha (Yakutia) as an

independent director


• 2007-2011 – First Deputy Minister of Property

Relations of the Republic of Sakha (Yakutia)

• Since 2011 – Minister of Property and Land Relations

of the Republic of Sakha (Yakutia)


• 2011-2016 – Chairman of the Management Board of

AO SOGAZ

• 2016-2017 – Senior Vice President, Head of Wealth

Management at Sberbank of Russia

• Since 2017 – CEO of ALROSA


• 2011-2016 – CEO of SIBUR

• Since 2007 – Member of the Board of Directors, Chairman

of the Management Board (since 2009) at SIBUR Holding


• 2003-2007 – Ministry of Property Relations of the


• 2007-2015 – Permanent Representative of the

Republic of Sakha (Yakutia) in St. Petersburg


Board of ALROSA

109 11

1413 15

12

Glossary

63

Term Definition

ct Carat : one of the four main diamond characteristics, the others being colour, cut and clarity; 1 carat=200 mg

m ct Million carats

CVD Chemical vapour deposition: a high-temperature, but normal-pressure process to grow lab-grown diamonds

DPA Diamonds Producers Association

FTC Federal Trade Commission

Gem-quality diamonds Diamonds used for jewellery manufacturing

HPHT High-pressure, high-temperature; a process using large presses to grow lab-grown diamonds

INED Independent Director

Lab-grown diamonds (LGD) Diamonds produced in laboratories using HPHT or CVD methods; also known as synthetic diamonds

m3 Cubic meter

Average price index Average index change of like-for-like diamonds prices (excl. +10.8 carats)

Reserves Resources known to be economically feasible for extraction

Resources Valuable deposits that could potentially be economically extracted at a later point

RoW Rest of the world

tn Tonnes

mmt Million tonnes

p.p. Percentage points

THANK YOU!

M: +7 985 760 55 74E: [email protected]

HEAD OF CORPORATE FINANCESERGEY TAKHIEV

MOSCOW, RUSSIA 11518424 OZERKOVSKAYA EMB.

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