non-ferrous metallurgy: copper - invest in …...first quantum minerals ltd. sociedad minera cerro...

NON-FERROUS METALLURGY: COPPERFACTS AND FIGURES

2014

ABOUT THE RUSSIAN DIRECT INVESTMENT FUND

The Russian Direct Investment Fund is a $10 billion fund established to make equity investments primarily in the Russian economy.

RDIF was created in 2011 under the leadership of the President and Prime Minister of Russia to co-invest alongside top global investors, acting as a catalyst for direct investment in Russia. RDIF together with its co-investors invested and committed over $7 billion for this purpose, of which RDIF alone invested $1.3 billion and over $6 billion came from the leading international co-investment partners.

RDIF also attracted over $15 billion of foreign capital into the Russian economy through long-term strategic partnerships.

RUSSIA IN THE GLOBAL COPPER INDUSTRY

I

6 WWW.INVESTINRUSSIA.COM

RUSSIA IN THE GLOBAL COPPER INDUSTRY

RUSSIA IS RANKED SIXTH GLOBALLY BY BOTH COPPER RESERVES AND MINING

Ranking of countries by copper reserves*2013, mln tonnes

Global copper miningLeading mining countries*, 2013, mln tonnes

1.1

19087 70

39 3830

2. Australia 3. Peru1. Chile 6. Russia4. USA 5. Mexico

4. USA1. Chile 2. China 3. Peru 6. Russia

5,700 1,2201,650 1,300 9309905. Australia

* Source: USGS data

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UMMC AND NORILSK NICKEL ARE AMONG THE LARGEST GLOBAL COPPER PRODUCERS

1.2

Key global players 2013, % of global production volumes

1. CodelcoChile

10

2. FreeportUSA

4. ВНРAustralia

10. UMMC OJSCRussia

11. MMC Norilsk Nickel OJSC

Russia

3. Glencore Xstrata

Switzerland

9 4 29 2

RUSSIAN COPPER INDUSTRY: CURRENT ISSUES AND TRENDS

II


COPPER MINING IN RUSSIA ACCOUNTS FOR 5% OF THE GLOBAL OUTPUT

2.1


Copper mining in Russia and globally2009-2013, thousand tonnes*

In Russia

* Source: USGS data

Globally

15,860

725

2009

14.5

15,938

703

2010

14.4

16,100

713

2011

14.4

16,900

883

2012

15.2

17,900

930

2013

15.2

— Russia’s share of the global production volumes, %1%

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2.2 REFINED COPPER IN RUSSIA IS PRODUCED BY UMMC, MMC NORILSK NICKEL AND RUSSIAN COPPER COMPANY

Copper production in Russia 2009-2013, thousand tonnes*

Production in Russia, % change from previous period

100.0

109.6102.8

97.6

2010 2011 2012 2013

853.5 885.5 924.4 887.4 886.42009

99.8


DOMESTIC COPPER CONSUMPTION IN RUSSIA IS RECOVERING FROM MARKET VOLATILITY IN 2012

2.3


Domestic copper consumption 2010-2013, thousand tonnes

Source: Ministry of Industry of the Russian Federation

Copper consumption in Russia, % change from previous period

106.2

80.4

109.4

100.02010

2011

2012

2013 267.0

258.5

312.3

251.4

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Russian exports of copper 2013, thousand tonnes

2.4 IN 2013, RUSSIA EXPORTED 223.3 THOUSAND TONNES OF COPPER

7.7

6

8.6

0.5

Uzbekistan

Bulgaria

refined copperores and concentrates

4.60,0285

Kazakhstan

China

BelarusGermanyNetherlands

126

Belgium

0.5

1

GEOGRAPHY AND CORPORATE STRUCTURE

III


GEOGR APHY AND CORPOR ATE STRUCTURE

< 5 5-50 50-400 > 400

KEY COPPER DEPOSITS IN RUSSIA3.1

Reserves, mln tonnes

Chukotka AO

Orenburg Region

Republic of Bashkortostan

Murmansk Region

1

4 6

73

5

10

9

2

Krasnoyarsk Krai

Sverdlovsk Region

Chelyabinsk Region

Zabaykalsky Krai

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3.2 RUSSIAN COPPER INDUSTRY: CORPORATE STRUCTURE

Oktyaberskoe (Krasnoyarsk Krai) Talnakhskoe (Krasnoyarsk Krai) Norilsk I (Krasnoyarsk Krai)

Peschanka (Chukotka AO)

Bystrinskoe (Zabaykalsky Krai)

Mikheyevskoe

Tominskoe (Chelyabinsk Region)

Volkovskoe (Sverdlovsk Region)

Zhdanovskoe (Murmansk Region)

Gayskoe (Orenburg Region)

Gorevskoe (Krasnoyarsk Krai)

Yubileynoe (Republic of Bashkortostan) Podolskoe (Republic of Bashkortostan)

MMC Norilsk Nickel OJSC GDK Baimskaya LLC

GRK Bystrinskoe LLC

Mikheyevsky GOK CJSC

Tominsky GOK CJSC

Svyatogor OJSC

Kolskaya MMC OJSC

Gaysky GOK OJSC

Bashkir Copper LLC

Baikal Mining Company LLC

1 6

7

8

9

10

2

3

4

5

Mines of the Holding company Mines of the Holding company

Mines of the Holding company










RUSSIAN COPPER INDUSTRY: CORPORATE STRUCTURE3.3

Polar Division (Norilsky Kombinat OJSC) Kolskaya GMK OJSC Kombinat Severonikel OJSC Mining and Metallurgical Kombinat Pechenganikel OJSC

Gaisky GOK Sredneuralsky Copper Smelter Metallurgical plant N/A A.K. Serov Bogoslovskoe mine Svyatogor Buribaevsky GOK Urupskiy GOK Sibir-Polimetally Bashkirskaya Med Uralelectromed Safyanovskaya Med

Talnakhskaya Norilskaya

Khaibullinskaya Rubtsovskaya Zarechenskaya Urupskaya Buribaevskaya Krasnouralskaya Gayskaya

Copper Metallurgical Plant Nickel Metallurgical Plant Nadezhdinsky Metallurgical Plant Severonikel Kombinat

Uralelectromed

MMC Norilsk Nickel

OJSC UMMC

1

2

Companies of the holding


Concentrating plants


Metallurgical processing enterprises

Metallurgical processing enterprises

MMC Norilsk Nickel

OJSC UMMC

1

2

WWW.RDIF.RU 19

Ormet Aleksandrinskaya mining company Verkhne-Uralskaya mine Mauksky mine Mikheevsky GOK Tominsky GOK

Uralhydromed Karabashmed Kyshtymsky copper plant Novgorod metallurgical plant

Vostok-olovo Solnechny GOK

Sorsky GOK Sorsky ferromolibdenum plant

Novo-Shirokinsky mine

Novo-Shirokinsky mine

CJSC Russkaya Mednaya Company

NOK

HC Soyuzmetalresurs

Highland Gold Minig LTD.

Glencore International AG

3

4

5

6

7






Aleksandrinskaya


CJSC Russkaya Mednaya Company

NOK

HC Soyuzmetalresurs

Highland Gold Minig LTD.

Glencore International AG

3

4

5

6

7


UMMC IS THE LARGEST PRODUCER OF RAW COPPER AND COPPER PRODUCTS


Copper production by key players 2011-2013, %

UMMC Revenues 2011-2013, thousand RUB

UM

MC

OJS

C

3.4

2011 2011

2012 2012

2013 2013

41.6

43.8

43.4

39.8 8,59218.6

39.8 8,59216.4

41.1 8,58015.5

UMMC OJSC MMC Norilsk Nickel Russian Copper Company

WWW.RDIF.RU 21

UMMC: KEY PERFORMANCE INDICATORS

UMMC production indicators2011-2013

Copper cathodes (pig copper), thousand tonnes

Copper powder, thousand tonnes

Rolled non-ferrous metals, thousand tonnes

Copper wire rod, thousand km

Cable products, thousand km

382.5

301.8

96.7

6.3

60.3

389.9

282.3

239.6

6.3

59.0

380.7

288.2

261.2

6.7

56.8


GEOGR APHY AND CORPOR ATE STRUCTUREM

MC

NO

RIL

SK N

ICK

EL

Russia

USA

UK

Canada

Peru

South Africa

China

Philippines

China

Australia

28 642.18

23 369.05

10 988.26

9 126.63

8 523.86

4 582.44

3 721.92

2 472.43

1 362.36

849.16

3.5

Norilsk Nickel

Southern Copper Corp.

Antofagasta Plc

First Quantum Minerals Ltd.

Sociedad Minera Cerro Verde SAA

Impala Platinum Holdings Ltd

Jilin Jien Nickel Industry Co., Ltd.

Nickel Asia Corp.

Chongyi Zhangyuan Tungsten Co., Ltd

Western Areas Ltd

11 121.42

6 669.27

6 325.39

3 446.50

1 804.65

2 728.63

391.16

245.54

322.42

301.93

Market capitalization, USD mln

Sales, USD mln

CompanyCountry

NORILSK NICKEL: NO. 1 IN GLOBAL INDUSTRY TOP – 102013, by sales volume and market capitalization

1

2

3

4

5

6

7

8

9

10

Sources: Bloomberg, Reuters

WWW.RDIF.RU 23

NORILSK NICKEL - MARKET LEADER 2013 , world metals production share

Coppper production,2011-2013, thousand tonnes

3782011 2012 2013

364 371№1global nickel producer

№1global palladium producer

№4global platinumproducer

№11global copperproducer

14% of global nickel

production

41% of global palladium

production

11% of global platinum

production

2% of global copper

production



NORILSK NICKEL MARKET CAPITALIZATION

Norilsk Nickel

Rio Tinto

BHP Billiton

VALE

Capitalization growthNov 2013 - Nov 2014, %

Sources: Bloomberg, Reuters, Company data

+20%

-9.3%

-19.3%

-41%

28.6Nov. 14

+20%

CapitalizationUSD bln

23.8Nov. 13

MM

C N

OR

ILSK

NIC

KEL

WWW.RDIF.RU 25

4.25.8

EBITDA USD bln

4251

4137

5.8 4.2 7.2 7.2 4.9 4.2 2008 2009 2010 2011 2012 2013

4956

EBITDA margin, %

RevenuesUSD mln

Earnings per shareUSD

2013

2012

2011

16.3

19.2

23.2

2013

2012

2011

11.5

12.4

14.5

NORILSK NICKEL: SUSTAINABLE HIGH MARGIN



NORILSK NICKEL: KEY FINANCIAL INDICATORS 2011-2013

Net Debt to EBITDA2013

Free Cash Flow2013, as % of Revenue

Norilsk Nickel

BHP Billiton

VALE

Rio Tinto

Anglo American

21

11

9

8

4

BHP Billiton

Rio Tinto

Norilsk Nickel

VALE

Anglo American

0.8x

0.9x

1.1x

1.1x

1.2x

MM

C N

OR

ILSK

NIC

KEL

WWW.RDIF.RU 27

C

AGR

30%

Europe 52

NORILSK NICKEL: DIVERSIFIED GLOBAL PLAYER WITH A FOCUS ON CHINA

Norilsk Nickel exports to China2005-2013, nickel, thousand tonnes

Norilsk Nickel Sales structure2013, %

North America 9

Asia 29

Russia 10

2005 2013

70

8.75


NOTES

WWW.RDIF.RU 29

NOTES


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non-ferrous metallurgy: copper - invest in …...first quantum minerals ltd. sociedad minera cerro...

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