Resources create opportunities

Resources create opportunities

Sberbank CIB “Russia: The Inside Track” Moscow Conference April 2015

2

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

Disclaimer

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

Average over the period: 2012 – 31.0930; 2013 – 31.8480; 2014 – 37.6248.

End of the period: 2012 – 30.3727; 2013 – 32.7292; 2014 – 56.2584.

This presentation (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 publically available in the Russian Federation and cannot be 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

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

1 Industry Update

2 Our Business

Strategy 3

4

5

Financials

Leadership

6 Summary

7 Appendices

4

40

70

100

130

160

31/12/12 31/03/13 30/06/13 30/09/13 31/12/13 31/03/14 30/06/14 30/09/14 31/12/14 31/03/15

02 03

05 06

08 09

11 12

14 15

17 18

20 21

Dramatic iron ore price decline…

USD/t

97 (2014)

Source: Bloomberg (Platts 62% Fe, CFR China)

62 (Q1 2015)

135 (2013)

47.5 (as o f 10.04.2015)

5

0

10

20

30

40

50

60

70

80

90

100

0 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000

Production volumes, mn t

Iron ore price decline may cause closure of high-cost mines

…brings challenging time for high-cost producers

Note: FOB cash costs in 2014 Source: AME * Platts 62% Fe, CFR China as of 10 April 2015

USD 48/t

FOB

ca

sh c

ost

s in

20

14

, U

SD

/t

current iron ore price*

6

Africa (Sierra Leone) (30.5 mn t) • Marampa mine (London Mining) shut down (5.5 mn t)

• Tonkolili mine (African Minerals) shut down (25.0 mn t)

South America (7.5 mn t) • MMX Mineração e Metalicos closed Serra

Azul Unit (6.0 mn t), Brazil

• BellaVista mine shutdown (1.5 mn t), Chile

USA (5.6 mn t) • Cliffs Natural Resources closed

Wabush Mines (5.6 mn t)

• US Steel processing plant Minntac Taconite plans to stop (9.0 mn t pellets)

Russia (1.7 mn t) • IRC iron demonstrate losses in 2013, 2014

year and expect s greater losses (1.7 mn t)

Sweden (6.2 mn t) • Kaunisvaara mine (Northland Resources) shut-down (5.0 mn t)

• Dannemora mine AB bankruptcy (1.2 mn t)

Canada (8.9 mn t) • Labrador Iron Mines Holding stopped ore mining at

the Schefferville deposit (1.7 mn t)

• Bloom lake mine (Cliffs) shut down (7.2 mn t)

India (40 mn t) • Closure of 26 mines in state Odisha (40 mn t)

• 5 iron ore pellet makers stopped production (15 mn t)

China (80-85 mn t)

• Banks forecasts: Credit Suisse: “Domestic production will

decline 16% to 310 mn t in 2014”

JPM: “China will need to cut about 85 mn t of

output in 2014, and a further 85 mn t to

2017”

• Rio Tinto estimated mine closures: 80 mn t

• CISA said China's iron ore supply is likely to fall by 70 mn t this year

Announcement of mines closure and production readjustment in 2014-2015

Announcement of mines closure and production readjustment since 2014: > 200 mn t

* Russia, Canada, Sweden, USA

mn t

Source: company data, JPM report, Rio Tinto investor day presentation

Australia (28.1 mn t)

• BHP Billiton closed Yarrie mine (1.0 mn t) • IMX Resources closed Cairn Hill (1.6 mn t) • Franches Creek mine shut down in Nov. 2014 (1.5 mn t) • Roper Bar mine (Western Desert Resources) shut down (2.0 mn t) • Atlas iron has announced production curtailments (13.0 mn t) • China`s Sinosteel suspend iron ore production (~2 mn t in 2014) • Koolan island mine (Mount Gibson Iron) shutdown (2.0 mn t) • Arrium closed one of its two iron ore mines (3.5 mn t) • Kimberly Metals production curtailments (1.5 mn t)

• Break-even for Mount Gibson, Grange ~ USD 55-65/t • FMG cash flow break-even is about USD 50/t

40

129

> 200

8 28

31 22

80

Ind

ia

So

uth

Am

eri

ca

Au

stra

lia

Afr

ica

Oth

er*

Wo

rld

(e

x-C

hin

a)

Ch

ina

Wo

rld

7

Market environment affects financial results and leverage

Company EBITDA, USD mn Net Debt / LTM EBITDA

2014 2013 % 2014 2013 ∆

Peer 1, Australia 30,335 32,594 (7%) 0.8x 0.8x (0.0x)

Peer 2, Australia 18,840 20,953 (10%) 0.7x 0.9x (0.2x)

Metalloinvest, Russia 1,961 2,291 (14%) 2.1x 2.4x (0.3x)

Peer 3, Brazil 1,780 2,306 (23%) 4.0x 2.9x +1.1x

Peer 4, Australia 3,856 5,661 (32%) 1.9x 1.5x +0.4x

Peer 5, USA 930 1,428 (35%) 2.9x 1.9x +1.0x

Peer 6, South Africa 2,016 3,163 (36%) 0.3x 0.1x +0.3x

Peer 7, Sweden 1,000 1,641 (39%) - - -

Peer 8, Brazil 13,353 22,560 (41%) 1.8x 1.0x +0.8x

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

Source: Companies’ data

Vu

lne

rab

ilit

y t

o ir

on

ore

pri

ce d

rop

in 2

01

4 (

-28

% y

-o-y

)

8

CONTENTS

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

2 Our Business

1 Industry Update

Strategy 3

4

5

Financials

Leadership

6 Summary

7 Appendices

9

Product Fe grade Shipments in 2014

65 - 70% (oxide Fe)

11.0 mn t

63 - 65% (oxide Fe)

13.9 mn t

~ 90%

(Fe)

2.3 mn t

~ 95%

(Fe)

1.8 mn t

up to 100%

(Fe)

4.2 mn t

Metalloinvest has its own unique business-model…

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

Lebedinsky GOK (LGOK)

Iron ore reserves 3.9 bn t

Mikhailovsky GOK (MGOK)

Iron ore reserves 10.5 bn t

Notes: - HBI – Hot Briquetted Iron, DRI – Direct Reduced Iron - Iron ore – iron ore concentrate and sintering ore - Proven and probable reserves as of 1 July 2010 adjusted by production until 31 December 2014 - Production volumes refer to 2014

Oskol Electrometallurgical Plant (OEMK)

Ural Steel

Key production assets Production and shipments in 2014

Iron ore production 38.7 mn t

Shipments

RUSSIA Moscow

Iron ore

Pellets

HBI / DRI

Pig iron

Steel products

Iro

n o

re p

rod

uct

s M

eta

llic

s S

tee

l

10

0

100

200

0 50 100 150 200 250

…based on the lowest cash costs in pellets and HBI/DRI globally

HBI/DRI production cost curve*

Pellets production cost curve*

Metalloinvest (LGOK)

Production, mn t

Production, mn t

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

Co

st, U

SD

/dm

tu

Co

st, U

SD

/t

Metalloinvest (MGOK)

Metalloinvest (LGOK)**

Metalloinvest (OEMK)

* CRU, Company data, 2012 ** LGOK – the most efficient HBI plant globally

0

200

400

0 5 10 15 20 25 30 35

11

Prudent stance on long-term relations with customers

199

187

181

210

201

196

221

214

211

180

170

157

195

187

177

210

204

196

159

148

138

153

143

134

197

191

185

127

115

104

153

143

134

178

171

164

106

106

109

136

136

138

166

166

167

162

177

200

181

193

211

199

208

222

118

133

145

145

157

167

173

182

189

244 / 036 / 052

255 / 183 / 042

Note: Percentages represent the Company’s revenue structure in 2014

Russia 41%

21%

Asia

7% MENA 16%

Europe

Key Customers: • NLMK • MMK • Koks Group • Evraz • Severstal • Kosogorsky MZ

Key Customers: • US STEEL KOSICE • ArcelorMittal • Tata Steel • Ferriere Nord

Key Customers: • Kobe Steel • SUIFENHE • XILIN

Key Customers: • Erdemir • ICDAS • Izmir

New contracts signed in 2014 – 2015

Revenue from other regions

15%

12

CONTENTS

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

3 Strategy

1 Industry Update

Our Business 2

4

5

Financials

Leadership

6

7

Summary

Appendices

13

~65% ~29%

~6%

Further intragroup processing into hot metal

Strategic focus on pellets and HBI/DRI…

4.5 4.6 4.7 5.2 5.2 5.3 5.3

2008 2009 2010 2011 2012 2013 2014 2017F

20.0 19.4

22.0 22.4 22.6 22.6 22.7

2008 2009 2010 2011 2012 2013 2014 2016F

Pellet production

HBI/DRI production

mn t

mn t

Pellet Plant 3:

+5 mn t

HBI-3: +1.8 mn t

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

Iron ore production

Iron ore shipments to third parties

Further intragroup processing into pellets and HBI/DRI

14

…brings more value to the Company

Capex

~450* USD mn

Design capacity

5.0 mn t

of pellets p.a. Pellet

Plant #3 at MGOK

Purpose of the project:

• To increase high value-added product volumes

• To meet market demand in high-grade pellets

87%

13%

Financing of the project as of

31.12.2014 (% of the budget)

* Estimated capex on the basis of 2013 prices and FX rates ** Estimated capex on the basis of 2014 prices and FX rates

Capex

~650** USD mn

Design capacity

1.8 mn t

of HBI p.a.

Purpose of the project:

• To satisfy the growing demand of

mini-mills for high-quality raw

materials

• To maintain leading global

position in the production of

merchant HBI

HBI #3 at LGOK

17%

83%

Financing of the project as of

31.12.2014 (% of the budget)

199 187 181

210 201 196

221 214 211

180 170 157

195 187 177

210 204 196

159 148 138

153 143 134

197 191 185

127 115 104

153 143 134

178 171 164

106 106 109

136 136 138

166 166 167

162 177 200

181 193 211

199 208 222

118 133 145

145 157 167

173 182 189

244 / 036 / 052

255 / 183 / 042

15

1,004

307

392

512 463 478

595

0

400

800

1,200

2008 2009 2010 2011 2012 2013 2014

USD mn

Moderate CAPEX as a major part of prudent financial policy

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

High flexibility in capital expenditures:

• Focus on 1-2 value-creating projects

• Flexible terms of the contracts

• Headroom for adjusting maintenance and expansion CAPEX in both directions determined by market environment

• Experience in CAPEX optimisation (in 2009)

CAPEX optimisation programme is in place

Internal cap of USD750-800 mn per annum

16

CONTENTS

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

4 Financials

1 Industry Update

Our Business 2

3

5

Strategy

Leadership

6

7

Summary

Appendices

17

59%

41%

Export sales

Domestic sales

Revenue in 2014: USD 6,367 mn

Revenue is strongly linked to hard currencies…

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

Support from rouble depreciation Diversified product mix

17%

24%

11% 7%

37%

4% 14%

21%

11% 11%

39%

4%

Iron ore Pellets HBI

Pig iron Steel products Other revenue

2014 – outer circle 2013 – inner circle

Large share of revenue comes from export…

103

90

74

62

3,591

3,264

3,524

3,881

3,000

4,100

5,200

20

60

100

Q2 2014 Q3 2014 Q4 2014 Q1 2015

Platts in USD Platts in RUB*

USD/t RUB/t

/ t

Sources: Company’s IFRS data, Bloomberg, Central Bank of Russia. *Quarterly-average Platts in USD multiplied by quarterly-average USD/RUB rate

/ t

Mining segment Steel segment

Contracts include global iron

ore indices dynamics as well

as USD/RUB exchange rate

change.

Correlation of domestic prices

with export netback

…domestic market pricing also includes FX component

18

97% 86% 90%

3%

14% 10%

6.0

4.7 4.2

0.0

2.0

4.0

6.0

8.0

10.0

31 December 2013 31 December 2014 31 March 2015

Short-term debt Long-term debt

USD bn

-21%

Ensuring long-term financial stability

*Weighted Average Life of debt **As of 31 December 2014 ***Ruble bonds were repurchased in March 2015

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

Decrease in total debt ensuring lower leverage

-12%

0.2 0.5 0.3

1.0

0.0 0.0 0.0

0.3

0.1

0.8

0.1 0.3

0.5 0.6

1.3

0.1 0.0

0.4

0.8

1.2

1.6

2.0

Liquidity as of

31 March 2015

Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 2017 2018 2019 2020 2021

RUB USD / EUR

USD bn

undrawn

committed credit lines

0.3 cash

Incl. USD 0.7 bn of Eurobonds

and USD 0.1 bn of PXF

PXF

PXF

Incl. USD 1.0 bn of Eurobonds

Incl. RUB 10.0 bn of Rouble bonds

PXF

Debt maturity schedule as of 31 March 2015 (USD 4.2 bn of total debt)

Increase in WAL* and decrease in cost of debt

0.0%

3.5%

7.0%

0

30

60

31 December 2013 31 December 2014 31 March 2015

WAL Average interest rate

months

PXF

PXF

19

Rating Agency 31.12.2011 31.12.2012 31.12.2013 31.12.2014 10.04.2015

Ba3 stable

Ba3 positive

Ba2 stable

Ba2 under

review

Ba2 stable

BB- stable

BB- positive

BB- positive

BB stable

BB negative

BB- stable

BB- stable

BB- positive

BB stable

BB stable

Metalloinvest’s rating remains in ‘BB’ category despite challenging times

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

20

CONTENTS

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

5 Leadership

1 Industry Update

Our Business 2

3

4

Strategy

Financials

6

7

Summary

Appendices

21

High quality assets…

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

UTH Russia is one of the fastest growing commercial television broadcasters operating in Russia

is the largest Internet company in the Russian-speaking world and the Internet leader in Russia in monthly users

is Russia’s 2nd largest mobile operator

MEGAFON PETER-SERVICE

MAIL.RU GROUP, PORTFOLIO INVESTMENTS

WITH DST

UTH RUSSIA

Telecoms Steel & Mining Internet Media

Alisher Usmanov

Founder (48% shares)

Farhad Moshiri

Partner

Vladimir Skoch

Partner

Others

Partners

USM Holdings • USM Holdings was formed in Dec. 2012 in order to bring the assets together under one holding company

The most important asset (historically)

METALLOINVEST

is Russia’s 2nd largest mobile operator

22

…with a top-notch corporate governance

3

4

2 Independent Non-Executive directors

Non-Executive directors

Executive directors

Board of Directors composition

Board of Directors structure

Ivan Streshinsky

Chairman, Non-Executive Director

Vadim Levin

Independent Non-Executive Director

Natalia Chumachenko

Non-Executive Director

Galina Aglyamova

Independent Non-Executive Director

Irina Lupicheva

Non-Executive Director

Andrey Varichev

Executive Director

Valeriy Kazikaev

Independent Non-Executive Director

Dmitry Tarasov

Executive Director (joined in 2014)

Sergey Soldatenkov

Non-Executive Director (joined in 2014)

Board of Directors

General Meeting of Shareholders

Audit committee

Head: • Galina Aglyamova (Independent director) Members: • Irina Lupicheva (Non-executive director) • Sergey Soldatenkov (Non-executive director)

Chairman Ivan Streshinskiy

CEO Andrey Varichev

Finance, Budgeting and Strategy

committee

Head: • Natalia Chumachenko (Non-executive director) Members: • Valeriy Kazikaev (Independent director) • Andrey Varichev (Executive director) • Dmitry Tarasov (Executive director)

Moving towards best corporate governance practice

Remuneration committee

(since 2014)

Head: • Sergey Soldatenkov (Non-executive director) Members: • Galina Aglyamova (Independent director) • Natalia Chumachenko (Non-executive director)

Management

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

23

CONTENTS

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

6 Summary

1 Industry Update

Our Business 2

3

4

Strategy

Financials

5

7

Leadership

Appendices

24

Metalloinvest’s key strengths

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

Top tier global

iron ore producer

#2 iron ore reserve base

in the world

Top-10 global iron ore player

& regional champion

Diversified customer

base with focus on

Emerging Markets

Direct sales to world’s

largest steel producers

Development

of logistics solutions

Resilient financials 1st quartile in

FCA cost curve

in pellets & HBI

Robust

profitability metrics

High level of

vertical integration

High level of processing:

pig iron and steel contribute

50% of revenue

Global leadership in

high value-added products:

Top-3 pellets producer

#1 HBI supplier

25

CONTENTS

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

7 Appendices

1 Industry Update

Our Business 2

3

4

Strategy

Financials

5

6

Leadership

Summary

26

Top tier iron ore reserve base

2.4 bn t

Metalloinvest

FMG

14.4 bn t

Vale 18.1 bn t

Note: Proven and probable reserves on a JORC equivalent basis (companies’ data, 2014); Metalloinvest’s reserves represent adjusted reserves (1 July 2010 JORC reserves adjusted by production until 31 December 2014)

Ferrexpo 1.4 bn t

ENRC 1.3 bn t

Cliffs Natural Resources 2.5 bn t

Kumba 0.9 bn t

3.9 bn t

Rio Tinto

c. 150 years

c. 50 years

- estimated reserve life based on 2014 iron ore mined production, companies’ data

c. 20 years

c. 20 years

c. 15 years

BHP Billiton

2.9 bn t

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

27

Product mix: focus on high value-added products

Fe content:

65 - 70% (oxide)

Utilisation:

Iron & Steel Works

(sinter plant)

Steel products for:

o Bridge manufacturers

o Automobile

manufacturers

o Pipe manufacturers

o Hardware industry

o Rolling-bearing

industry

Fe content:

63 - 67% (oxide)

Utilisation:

Iron & Steel Works

(Blast Furnace feed,

no sintering required)

Iron ore concentrate HBI / DRI Pellets Steel products

Fe content:

90% (pure iron),

direct scrap substitute

Utilisation:

Mini-Mills (EAF) /

Iron & Steel Works (BOF)

Environmentally-friendly

product

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

28

Key financial indicators

USD mn Q1 2014 Q2 2014 Q3 2014 Q4 2014 FY 2014 FY 2013 Change

Revenue 1,805 1,728 1,571 1,263 6,367 7,324 (13.1%)

Gross profit 853 804 683 646 2,986 3,411 (12.5%)

EBITDA 551 542 440 428 1,961 2,291 (14.4%)

EBITDA margin 30.5% 31.4% 28.0% 33.9% 30.8% 31.3% (0.5 ppt)

Net Income 115 434 59 (542) 66 1,080 (93.9%)

Capex 103 183 176 132 595 478 24.5%

Total Debt 5,712 5,848 5,377 4,734 4,734 5,965 (20.6%)

Short-term Debt 931 951 780 644 644 190 3.4х

Cash and cash equivalents 608 993 1,097 550 550 523 5.2%

Net Debt 5,105 4,855 4,280 4,185 4,185 5,443 (23.1%)

Net Debt / EBITDA LTM 2.26x 2.27x 2.08x 2.13x 2.13x 2.38x (10.5%)

Notes: EBITDA stands for EBITDA adjusted according to IFRS requirements. For more details please refer to IFRS Report Capex means purchase of property, plant and equipment and intangible assets Net Debt / EBITDA is calculated based on EBITDA for the last 12 months

29

Debt profile as of 31 March 2015

65%

34%

1%

72%

27%

2%

USD

RUB

EUR

24%

36%

13%

20%

7% 28%

41%

4%

22%

5% PXF

Eurobonds

RUB bonds

Sberbank

Other

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

Note: Management data as of 31 March 2015 *Pre-export financing

Total Debt: USD 4,2 bn

Breakdown by source Breakdown by currency

2015 key developments

Decrease in total debt by USD 0.5 bn q-o-q due to RUB bonds

repurchase in March 2015 (series 01, 05, 06). As a result:

• Decrease in share of short-term debt

• Increase in share of USD debt

Q1 2015 eop – outer circle FY 2014 eop – inner circle

86%

14%

90%

10%

Long-term

Short-term

30

01 02 03

04 05 06

07 08 09

10 11 12

13 14 15

16 17 18

19 20 21

00

Phone: +7 (495) 981 55 55

Fax: +7 (495) 981 99 92

E-mail: ir@metalloinvest.com

Web: www.metalloinvest.com

CONTACTS