Resources create opportunitiesResources create opportunities

2019 IFRS Financial ResultsMarch 17, 2020

2

Disclaimer

The following USD/RUB exchange rates were used for the presentation of those financial results:

Average over the period: Q1 2018 – 56.8803; Q2 2018 – 61.7998; Q3 2018 – 65.5323; Q4 2018 – 66.4822;

Q1 2019 – 66.1271; Q2 2019 – 64.5584; Q3 2019 – 64.5685; Q4 2019 – 63.7192.

End of the period: H1 2018 – 62.7565; 2018 – 69.4706; H1 2019 – 63.0756; 2019 – 61.9057

This presentation of Metalloinvest’s financial results for 2019 (the “Presentation”) contains certain forward-looking statements, particularly those relating to anticipated

demand and consumption, global economic conditions, commodity prices, management aims and objectives, strategy, production, anticipated investments and

anticipated completion of previously announced transactions. Metalloinvest will not update these statements to reflect events and circumstances occurring after the date

hereof. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that will or may occur in the

future. Actual results may differ from those expressed in such statements depending on a variety of factors, including future levels of industry product supply, demand and

pricing, operational problems, general economic conditions, political stability and economic growth in relevant areas of the world, changes in laws and governmental

regulations, exchange rate fluctuations, development and use of new technology, changes in public expectations and other changes in business conditions, the actions of

competitors, natural disasters and adverse weather conditions, wars and acts of terrorism or sabotage, other factors discussed elsewhere in this document, as well as

other risks affecting Metalloinvest and its operations.

The contents of this Presentation do not constitute or form part of any advertisement of securities, any offer or invitation to issue, sell, purchase, exchange or transfer or

any solicitation of any offer to purchase or subscribe for, any securities of Metalloinvest in any jurisdiction, nor shall this Presentation nor any part of it nor the fact of its

presentation, communication or distribution form the basis of, or be relied on in connection with, any contract or investment decision. Any foreign securities which are

mentioned in this Presentation are not and will not be registered in the Russian Federation by any state authority responsible for registration of such securities and such

securities shall not be admitted to subscription nor shall be publicly available in the Russian Federation and cannot be the subject of any offer in the Russian Federation,

except in the cases permitted by the law of the Russian Federation. No representation or warranty, express or implied, is given by Metalloinvest, its affiliates or any of their

respective advisers, officers, employees or agents, as to the accuracy of the information or opinions or for any loss howsoever arising, directly or indirectly, from any use of

these materials or their contents.

3

Contents

I. Key Highlights………...….……….………………..………………………………….. 4

II. Operational Results..…….....……………………………………………………….. 7

III. Financial Results …...…………………………………………………………………. 11

IV. Debt & Ratings ……...………………………………………………………………….. 15

Appendix…………………………………………………………………………………… 20

4

KEY HIGHLIGHTS

5

180

270

360

450

2016 2017 2018

Pig iron, FOB Black Sea HBI, import Italy

• China is continuing to consolidate its steel industry, and the various cuts, location shifts, and mergers make for an unpredictable long-term outlook

• The current economic environment is highly uncertain and is constraining supply growth, despite a deficit, due to uncertainty of demand going forward with slowing investment

Iro

n o

re &

p

ell

ets

Me

tall

ics

(pig

iro

n &

HB

I)S

tee

l p

rod

uct

s

Main drivers

• Supply disruptions in Brazil and Australia pushed prices up

• Uncertainty with recovery of Brazilian operations led to price stability amid falling demand in China

• Iron ore suppliers cut prices on fears of declining global demand due to coronavirus outbreak

• Due to strict environmental requirements in Europe pig iron consumption is being replaced by scrap and HBI/DRI

• Deficit of DR grade pellets due to incident in Brazil combined with rapid growth of DRI production leads to moderate growth of metallic prices

2.112.17

2.252.13 2.15

2.21

1.6

1.8

2.0

2.2

2.4

2017 2018 2019Demand Supply

Iron ore products market balance, bn t

Market trends

94.4 97.6 91.9

12.2 14.2 12.3

10.3 11.59.7

116.9 123.3 114.0

0

50

100

150

2017 2018 2019

Scrap Pig iron HBI/DRI

0.77 0.84 0.90

0.85 0.870.88

1.63 1.711.78

0.0

0.7

1.4

2.1

2017 2018 2019China RoW

Price dynamics

Trade of metallics, mn t

Steel product consumption, bn t

50

100

150

200

2016 2017 2018 2019

Pellets, 65% Iron ore, 62% Iron ore, 65%

USD/t, CFR China, indices

Source: data provided by analytical industry agencies, ISSB, WSA

300

400

500

600

2016 2017 2018 2019

Steel billet, FOB Black Sea

Market review

USD/t, index

USD/t, indices

2017 2018 2019

2017 2018 2019

2017 2018 2019

6

Highlights

Key financials, USD mnUSD mn 2019 2018 Change

Revenue 6,960 7,187 (3.2%)

Gross profit 3,766 3,919 (3.9%)

EBITDA1 2,514 2,934 (14.3%)

EBITDA margin 36.1% 40.8% (4.7 p.p.)

Net income 1,731 1,647 5.1%

Capex 517 441 17.2%

USD mn, eop 31.12.2019 31.12.2018 Change

Total debt 4,059 4,051 0.2%

Short-term debt 70 221 (68.3%)

Cash & equivalents 304 693 (56.1%)

Net debt 3,755 3,358 11.8%

Net debt / EBITDA 1.49x 1.14x 0.35x

Notes: 1 Hereinafter EBITDA stands for EBITDA adjusted according to IFRS requirements. For more details please refer to IFRS Statements2 The indicator has an informational character and does not contain adjustments as per loan documentation

Source: Fastmarkets

Global iron ore & steel prices, USD/t

6,2317,187 6,960

Revenue2017 2018 2019

2,1202,934 2,514

EBITDA2017 2018 2019

Net Debt/EBITDA2

1.91x1.14x 1.49x

300

375

450

525

600

60

80

100

120

140

03-Jan-17 03-Jan-18 03-Jan-19 03-Jan-20Iron ore index (65% Fe, CFR China)Steel billet index (FOB Black Sea), RHS

2017 2018 2019

88 90

104436

489

407

7

OPERATIONAL RESULTS

8

40.3

25.1

7.0

2.7

4.8

40.4

27.7

7.8

3.0

5.1

40.2

28.1

7.9

2.7

4.9

Iron ore

Pellets

HBI/DRI

Hot metal

Crude

steel

2017 2018 2019

-0.3%

+1.5%

+0.5%

-9.1%

x%

2019 key developments

• Iron ore production volumes totaled 40.2 mn tonnes

and remained almost flat (a decrease of 0.3% y-o-y1)

following product mix changes in favour of high value-

added concentrate and changes in mined ore quality

• Pellet production increased by 1.5% y-o-y to 28.1 mn

tonnes mostly due to completion of major maintenance

works at Pellet Plant #2 at LGOK and reconstruction of

Pellet Plant #3 at MGOK

• HBI/DRI output increased by 0.5% y-o-y to 7.9 mn tonnes

mostly driven by increase in production at HBI-3 Plant at

LGOK

• Hot metal production totaled 2.7 mn tonnes, a decrease of

9.1% y-o-y following maintenance works at blast furnaces

at Ural Steel

• Crude steel production totaled 4.9 mn tonnes, a decrease

of 3.7% y-o-y mostly due to plant reconstruction and hot

tests of the FMF2 at Ural Steel

Production volumes

mn t

Data on major plants: LGOK, MGOK, OEMK, Ural Steel

Iron ore refers to iron ore concentrate and sintering ore1 Hereinafter comparison with FY20182 Flexible Module Furnace

y-o-y change

-3.7%

9

7.6 7.4

14.0 14.9

4.2 4.4

25.9 26.7

2018 2019

HBI/DRI

Pellets

Iron ore

1.1 0.61.5 0.91.1 5.8

5.5

5.4

16.814.0

25.9 26.7

2018 2019

Russia

Europe

Asia

MENA

Others 2.31.6

0.40.4

1.10.9

1.11.5

1.91.9

6.86.3

2018 2019

Russia

MENA

Europe

Asia

Others

Shipment structure

Data on major plants: LGOK, MGOK, OEMK, Ural Steel

Iron ore products

Iron ore products

Mining Segment Steel Segment

Pig iron & steel products

mn t

mn t

mn t

mn t

71% 72%

HVA share

Steel products

2.3 2.5

0.3 0.31.1 0.90.3 0.20.6 0.6

4.6 4.6

2018 2019

Plate HVA

Plate

SBQ HVA

Semi-finished product HVA

Semi-finished product

10

Capital expenditure breakdown in 2019

489441

517

450 area

2017 2018 2019 2020F

USD mn

The Company is implementing its Industry 4.0 business

transformation programme. Current progress includes:

• Successful operation of the integrated financial andbusiness management system using the SAPS/4HANA business suite at LGOK and MGOK since July2018 and at OEMK, Ural Steel and the Company’strading and logistics operators since July 2019

• Operation of data centre in Stary Oskol

USD 19 mn

Mining Segment

Construction of HBI-3 Plant infrastructure facilities at LGOK

Steel Segment

USD 13 mn

Purchase of new high productivity mining vehicles at LGOK & MGOK USD 96 mn

Construction of conveyor facilitiesat MGOK & LGOK USD 47 mn

Technical re-equipping of CCM #3 at OEMK

Reconstruction of EAFs2 at Ural Steel

Notes:

Capex data on the graph for 2017, 2018 and 2019 refers to IFRS Statements, all other figures reflect management accounting1 Blast Furnace2 Electric Arc Furnace

Project to develop wet magnetic separation with the launch of fine screening at MGOK

USD 13 mn

Construction of medium pressure boilers for the thermal power plant at Ural Steel

USD 26 mn

Construction of external electric power supply facilities at LGOK

USD 22 mn

USD 20 mn

USD 13 mn

USD 15 mn

Modernisation of BF1 #2 and BF #3at Ural Steel

Construction of the heat treatment facility for hot-rolled steel (SBQ) at OEMK USD 32 mn

11

FINANCIAL RESULTS

12

2,880

1,632

421

782

1,471

2,834

1,474

966

803

884

Russia

Europe

Asia

Middle East

Other

countries2018

2019

Revenue composition

2019 Revenue: USD 6,960 mn

USD mn

7%

20%

18%

12%

41%

2%

9%

25%

16%9%

38%

3%

Iron ore Pellets

HBI Pig iron

Steel products Other revenue

2019 – outer circle2018 – inner circle

Revenue by region

Export share59% in 2019

vs.60% in 2018

1 Others include Americas and CIS countries

1

13

1,742

406

2,267

654

2,426

118

Mining Steel

2017 2018 2019

2,934

2,514

73

19

(227)

(228)

(57)

EBITDA 2018

Revenue

Cost of sales

Distribution

expenses

G&A expenses

Other

EBITDA 2019

EBITDA y-o-y dynamics

EBITDA composition

2019 EBITDA: USD 2,514 mn

USD mnDriven by positive dynamics of iron ore prices and

negative performance of steel prices in 2019,

Metalloinvest’s EBITDA remained resilient,

demonstrating margin of 36%

EBITDA by segment dynamics

36.1%

40.8%

EBITDA margin

USD mn

14

1,325 1,414

2,934

69

2,514

201

9

(317)

(460)

(461)

(441)

(290)

(504)

(517)

EB

ITD

A

Inte

rest

Taxe

s

Ch

g.

in N

WC

Ca

pe

x

Oth

ers

FCF

EB

ITD

A

Inte

rest

Taxe

s

Ch

g.

in N

WC

Ca

pe

x

Oth

ers

FCF

Positive Free Cash Flow

USD mn

2018 2019

Notes:

EBITDA stands for EBITDA adjusted according to IFRS requirements. For more details, please refer to IFRS Statements

15

DEBT & RATINGS

16

Debt profile as of 31 December 2019

Sources: IFRS data, management accounts1 Total Debt as of 31 December 2019 includes USD 115 mn of operational lease payments

due to the implementation of a new IFRS 16 standard since 1 January, 2019 2 Undrawn credit lines

Cash

USD mn

Cash

*

0.3 0.2 0.3 0.3 0.2

0.62

0.70.7

0.9

0.20.1

0.9

0.04

0.40.7

0.9

1.2

0.50.3

0.02

Liquidity 2020 2021 2022 2023 2024 2025 2026 After 2026

RUBUSD/EUR

Debt maturity schedule as of 31 December 2019

USD bn

4,446

4,051 4,05914,056

3,358

3,755

1.91x

1.14x1.49x

31-Dec-17 31-Dec-18 31-Dec-19

Total Debt Net Debt Net Debt/EBITDA

Cash

1.91x

USD mn

Net Repayment of borrowings (252)

Operational lease payments (IFRS 16 adoption)

+115

Other (incl. FX changes) +145

Total debt change (y-o-y) +8

Total debt performance, y-o-y

17

Upgrade of all credit ratings in 2019

In 2019, the Big Three international credit agencies – S&P, Moody’s and Fitch, and the Russian credit agency Expert RA upgraded Metalloinvest by one rating notch

Mar. 2019Feb. 2019 May 2019 May 2019

Stable Stable Stable StableBa1BB+ BB+ ruAA

S&P Gl Moody's Fitch

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Ba1/BB+

Ba2/BB

Ba3/BB–

Rating history

Ba3 stable

BB–stable

BB–positive

Ba1 stable

BB+stable

BB+stable

Note: Credit ratings of AO Holding Company METALLOINVEST as of 31 December 2019

Scale

18

Date Rationale Description

Q3 2018 –Q2 2019 Refinancing

– RUB 32 bn (Sberbank)+ RUB 27 bn (Gazprombank)+ RUB 5 bn (series BO-09 bond)

Q2 2019 Reprice USD 250 mn(PXF-2017 tranche B)

Q2 2019 Debt repayment– USD 62 mn(Eurobonds partial redemption)

Q3 2019 –Q4 2019 Refinancing

– USD 60 mn (PXF-2017)– USD 271 mn (Eurobonds-2020)+ EUR 300 mn (PXF-2019/1)

Q4 2019 Refinancing – RUB 10 bn (series BO-01 bond)+ RUB 10 bn (series BO-03 bond)

Q4 2019 Refinancing– USD 165 mn (PXF-2017)– RUB 3.3 bn (Sberbank)+ EUR 200 mn (PXF-2019/2)

Q1 2020 Refinancing – RUB 10 bn (Sberbank, PXF)+ RUB 10 bn (series BO-04 bond)

New instruments

Apr. 2019

Sustainability Improvement Loan

Aug. 2019

ECA-Framework

general agreement with12 international banks

on ECA-financing

Interest rate depends onEcoVadis rating level

Oct. 2019

1st ECA-backed deal with MUFG under

the framework agreement (~EUR 10 mn)

USD mn

100or EUR equivalent

Proactive debt management and new sources of funds

Key recent debt transactions

Subsequent event

57 points 60 points

19

ESG is an important element of the Company’s strategy

1 CSR - Corporate Social Responsibility

In December 2019, Metalloinvest's'Silver' CSR rating from EcoVadis,

the international independent rating agency, was confirmed

Metalloinvest is in the top-12% of companies rated by EcoVadis

globally and is in the top 8% in the 'environment' category and in the

top 4% in the 'labour & human rights' category among the producers in the manufacture of basic iron and

steel industry

The Sustainable Development Report was prepared in accordance with the GRI (the Global Reporting

Initiative)

The report is assured by an independent auditor (PwC)

The report also has an official verification from the Russian Union of Industrialists and Entrepreneurs

(RSPP)

Metalloinvest undertakes programmes under the trilateral

contracts of the Social and economic partnership with municipal and

regional administrations in all regions where it is present

In August 2019, Metalloinvestjoined the United Nations Global

Compact (UNGC) – an international initiative in the fields of corporate

sustainability and social responsibility

Metalloinvest has undertaken voluntary commitments to comply with the fundamental principles

of the UNGC

In December 2019, the Company achieved 4th place in the WWF’s

2019 transparency ratings of Russian M&M companies

in the field of environmental responsibility

This is the leading ranking for companies in the ferrous metallurgy industry. Last year the Company was

ranked 6th

In December 2019, Metalloinvestwas once again included as

a leader in the RSPP Sustainability Indices for 2019 in the

‘Responsibility and Transparency’ and ‘Sustainable Development

Vector’ categories

The index judges how well companies disclose CSR info

In December 2019, Metalloinvesttook 45th place in Interfax-ERA’s

Fundamental Efficiency (environmental & energy) rating

The rating covers the top 150 companies in Russia and

Kazakhstan. Moreover, Metalloinvestranked 2nd among the top-5 steel

companies in terms of steel production

In April 2019, Metalloinvest signed a sustainable finance credit line for up

to USD 100 mn (or EUR equivalent)until 30 November 2020.

The interest rate of the ‘Sustainability Improvement Loan’ depends on the level of CSR rating

from EcoVadis

20

APPENDIX

21

Well-balanced debt structure

Source: management accounts1Credit facility guaranteed by Export Credit Agencies (ECA)

By source

8%8%

7%

29%32% 40%

25%

28% 20%

16%

14% 18%

21%15% 14%

31-Dec-17 31-Dec-18 31-Dec-19

RUB bank loans

RUB bonds

Eurobonds

PXF

ECA

Other

Public debt

41%42%

38%

By currency

63%70% 67%

37%30% 33%

31-Dec-17 31-Dec-18 31-Dec-19

RUB

USD/EUR

1

22

Committees

Name Category Company AuditFinance, Budgeting

& StrategyRemuneration

Ivan StreshinskyChairman

Non-executive

Galina Aglyamova

INDEPENDENTValery Kazikaev

Dmitry Tarasov

Uluç Ergin

Non-executive

Gleb Kostikov

Irina Lupicheva

Pavel Mitrofanov

Vakhtang KocharovVice Chairman

Executive

Andrey Varichev

C

C

CMember of a committee Committee Chairman

C

30% of BoD

30% of the Board of Directors is independent

23

Key financial indicators

USD mn H1 2018 H2 2018 FY 2018 H1 2019 H2 2019 FY 2019 Y-o-Y

Revenue 3,779 3,408 7,187 3,584 3,376 6,960 (3.2%)

Gross profit 1,977 1,942 3,919 1,969 1,797 3,766 (3.9%)

EBITDA 1,491 1,443 2,934 1,410 1,104 2,514 (14.3%)

EBITDA margin 39.5% 42.3% 40.8% 39.3% 32.7% 36.1% (4.7 p.p.)

Net Income 870 777 1,647 1,020 711 1,731 5.1%

Capex 234 207 441 221 296 517 17.2%

Total Debt 4,287 4,051 4,051 4,109 4,059 4,059 0.2%

Short-term Debt 581 221 221 414 70 70 (68.3%)

Cash & cash equivalents 477 693 693 528 304 304 (56.1%)

Net Debt 3,811 3,358 3,358 3,581 3,755 3,755 11.8%

Net Debt / EBITDA LTM1 1.49x 1.14x 1.14x 1.25x 1.49x 1.49x 0.35x

1 Net Debt / EBITDA LTM is calculated based on EBITDA for the last 12 months;

the indicator has an informational character and does not contain adjustments as per loan documentation

24

Investor Relations & Corporate Ratings Department

Contacts

Artem Lavrischev

Director of Investor Relations & Corporate Ratings

T: +7 (495) 981 55 55, ext. 7243

ir@metalloinvest.com

www.metalloinvest.com

mailto:ir@metalloinvest.comhttp://www.metalloinvest.com/