Mmk · RUS:MAGN
Mmk — Investor Day (December 2021)
47 slides from Mmk's investor day presentation, December 2021
Slide 1: Capital Markets Days
a 4g & CAPITAL MARKETS DAYS December 2021 Magnitogors k, Russia ti
Slide 2: Disclaimer
MMK's key development priorities Market overview DISCLAIMER ‘These materials are provided for information purposes only. These materials are intended for distribution in the UK only to persons who have professional experience in matters relating to investments falling within Article 19(5) of the Fin
Slide 3: MMK's key development priorities
Slide 4: MMK has been posting record high financial performance in 2021
MMK's key development priorities Market overview MMK's ements and growth plans Appendix MMK HAS BEEN POSTING RECORD HIGH FINANCIAL PERFORMANCE IN 2021 8,985 Steel products sales 7,710 ths tonnes @ Share of premium products Revenue 49% 42% +86.5% Indicator 9M 2020 9M 2021 Change EBITDA Revenue, USD m
Slide 5: MMK delivers industry-leading shareholder returns
MMK’s key development priorities Market overview MMK’s achievements and growth plans Appendix MMK DELIVERS INDUSTRY-LEADING SHAREHOLDER RETURNS Increases in share prices TSR” of metals companies of metals companies 40.7 for 9M 2021 26.2 for 9M 2021 % % 19.9 36.8 24.2 7.2 Peer 1 Peer 2 MMK Peer 1 Pee
Slide 6: MMK's strategy is rooted in sustainable development principles
MMK's key development priorities Market overview MMK's achievements and growth plans Appendix MMK’s STRATEGY IS ROOTED IN SUSTAINABLE DEVELOPMENT PRINCIPLES ® Continuous improvement © Zero injuries © Corporate culture of opportunities in environmental performance and reduction in CO2 emissions Maxi
Slide 7: MMK successfully reduces environmental footprint
MMK's key development priorities Market overview MMK's achievements and growth plans Appendix MMK SUCCESSFULLY REDUCES ENVIRONMENTAL FOOTPRINT Key international metals and mining companies average, 2020 0.6 0.6 0.7 Nitrogen oxide 6 kg/t of steel 1 : 0.5 a —+0,7 Sulf Jioxid : kg/t of steel 0.4 0.4 g/
Slide 8: Programme to cut CO2 emissions to 1.8 tonnes per tonne of steel by 2025
MMK's key development priorities Market overview MMK's achievements and growth plans Appendix MMK HAS DEVELOPED A PROGRAMME TO CUT CO2 EMISSIONS TO 1.8 TONNES PER TONNE OF STEEL BY 2025 Key metals and Specific emissions, World Steel mining companies Association in Russia t of CO./t of steel” average
Slide 9: MMK explores routes to net zero beyond 2025
MMK's key di lopment priorities Marke MMK's acl Appendix MMK EXPLORES ROUTES TO NET ZERO BEYOND 2025 Option 1 Blast furnace shop reconstruction: use of syngas in blast furnaces C02 emission reduction min tonnes per year ¥0.9 Installation of Midrex DRI” technology and submerged EAFs,” replacing old b
Slide 10: MMK maintains industry leadership in health and safety
MMK's key development priorities Market overview MMK's achievements and growth plans Appendix MMK MAINTAINS INDUSTRY LEADERSHIP IN HEALTH AND SAFETY ' ‘0.85 World Steel Association average, 2020 LTIFR” *1.16 Key metals and mining companies in Russia average, 2020 2020 2021E 2025 Consistent step to Z
Slide 11: MMK follows best practices in corporate governance
MMK's key development priorities Market overview MMK's achievements and growth plans Appendix MMK FOLLOWS BEST PRACTICES IN CORPORATE GOVERNANCE recommended by the Bank Board composition Cs) Corporate Governance Code of Russia sayy Moscow Exchange and London RR stock exchange IPO Guide and Listing R
Slide 12: International ESG ratings recognise MMK's successful performance
Appendix INTERNATIONAL ESG RATINGS RECOGNISE MMK’s SUCCESSFUL PERFORMANCE 3.0 © 2.3 2.3 = - +30% « ° 56 Of) & +331% CO SN 20 NowaPartof SEPGlobal |S 40.2 40.2 37.1 -8% ~ By 9 7] SUSTAINALYTICS 61 55 55 +11% REFINITIV [< c +24 Key results and achievements in 2021 Top 5.in the ESG Reporting Awards 202
Slide 13: Landmark projects aimed at excellence in production
ements and growth plans Appendix MMK's key development priorities Market overview MMK HAS LAUNCHED LANDMARK PROJECTS AIMED AT EXCELLENCE IN PRODUCTION Scheduled launch 2025 Scheduled launch 2023 Expected impact >) Expected impact > IRR” IRR" EBITDA CAPEX EBITDA CAPEX usp] 355 mn v0 ,07 Ban 22% uso F
Slide 14: Landmark projects aimed at excellence in production (continued)
MMK's ki ities Appendix MMK HAS LAUNCHED LANDMARK PROJECTS AIMED AT EXCELLENCE IN PRODUCTION Oxygen station Scheduled launch 2023 Scheduled launch Continuous Casting Machine No. 7 Expected impact > EBITDA CAPEX IRR" usp 45min up25Qmn 2O~ average annual impact * Increase in oxygen, nitrogen, and argo
Slide 15: Average capex expected to grow to USD 1,250 million in 2022-2025
MMK's key development priorities Market overview MMK's achievements and growth plans Appendix AVERAGE CAPEX IS EXPECTED TO GROW TO USD 1,250 MILLION IN 2022-2025 127 1,250 950 Maintenance CAPEX Development CAPEX 7 Higher share of environment-related projects in total growth CAPEX Long-term average I
Slide 16: Market overview
MARKET OVERVIEW
Slide 17: Global steel consumption will continue to recover in 2022
MMK’'s key development priorities Market overview MMK's achievements and growth plans Appendix GLOBAL STEEL CONSUMPTION WILL CONTINUE TO RECOVER IN 2022 Global consumption of rolled Global capacity utilisation products is expected to grow by will remain high more than 2% in 2022 min tonnes | 1,896 :
Slide 18: Russian economy and metals sector posted strong growth in 2021
MMK’s key development priorities Market overview MMK's achievements and growth plans Appendix THE RUSSIAN ECONOMY AND METALS SECTOR POSTED STRONG GROWTH IN 2021 5.1% 4.7% 58.8 © Changes in Russia’s GDP, % © Changes in Russia’s metal consumption, % HB Russia (metal consumption), min tonnes i cis (met
Slide 19: Further growth in Russian domestic steel demand up to 2025
MMK’'s key development priorities Market overview MMK's achievements and growth plans Appendix MMK EXPECTS FURTHER GROWTH IN RUSSIAN DOMESTIC STEEL DEMAND UP TO 2025 Steel consumption by industry, 2020 Consumption CAGR 2022-2025", % >. Construction “and metal trade Source: MMI. 19 Note: (1) From a 2
Slide 20: MMK is poised to capture growing demand for premium products
MMK’'s key development priorities Market overview MMK's achievements and growth plans Appendix MMK IS POISED TO CAPTURE GROWING DEMAND FOR PREMIUM PRODUCTS a hte 12.3 11.9 11.5 Potential for import substitution Consumption of premium products in Russia min tonnes i Imports I Domestic production 2020
Slide 21: Raw material prices gradually stabilise
MMK’'s key development priorities Market overview MMK's achievements and growth plans Appendix AS RAW MATERIAL PRICES GRADUALLY STABILISE, MMK WILL ENJOY A STRONGER POSITION Scenario-based forecast of iron ore prices Scenario-based forecast of coking coal spot (CIF China) prices (HCC, FOB Australia)
Slide 22: MMK's achievements and growth plans
Slide 23: Strategy 2025 is set to maximise total shareholder return
MMK’'s key development priorities Market overview MMK's achievements and growth plans Appendix STRATEGY 2025 IS SET TO MAXIMISE TOTAL SHAREHOLDER RETURN (TSR) ® Continuous improvement © Zero injuries © Corporate culture of opportunities in environmental performance and reduction in CO2 emissions Max
Slide 24: MMK prioritises employee development
MMK’'s key development priorities Market overview Appendix MMK PRIORITISES EMPLOYEE DEVELOPMENT — implementation My MMK app of suggestions with potential 90%)of employees covered economic impact in 2021 Educational platform i Goals: 27h00;suggestions approved * Road map for career development PP * P
Slide 25: MMK on track to deliver USD 270 million of incremental EBITDA
MMK’'s key development priorities Market overview MMK's achievements and growth plans Appendix MMK ON TRACK TO DELIVER USD 270 MILLION OF INCREMENTAL EBITDA BY YEAR-END 2021 Annual EBITDA impact from strategic 780 1,050 initiatives, 2020-2025 USD min ll Superior product portfolio 1 Customer focus ll
Slide 26: Premium product development helped MMK attract new business
Market overview MMK's key development priorities Appendix TO BE THE BEST SUPPLIER / SUPERIOR PRODUCT PORTFOLIO PREMIUM PRODUCT DEVELOPMENT HELPED MMK ATTRACT NEW BUSINESS Higher share of high-margin products contributed an incremental, EBITDA. of, USD.26. million,in,2021,.vs.2019 Automotive market l
Slide 27: MMK strengthens sales performance by growing its own sales network
Appendix MMK's key development priorities Market overview MMK's a: TO BE THE BEST SUPPLIER / CUSTOMER FOCUS MMK STRENGTHENS SALES PERFORMANCE BY GROWING ITS OWN SALES NETWORK Incremental EBITDA of USD 6 million per year in 2021 vs 2019 MMK Trading House : : Marketplace « New B2B and B2C units across
Slide 28: Better on-time delivery improved customer service
MMK’s key development priorities Market overview MMK's achievements and growth plans Appendix TO BE THE BEST SUPPLIER / CUSTOMER FOCUS BETTER ON-TIME DELIVERY PERFORMANCE HAS IMPROVED CUSTOMER SERVICE AND CREATED ECONOMIC IMPACT OTIF” improvement % — 1 % +130%. \ 80% 72% 64% 54% 2019 2020 2021E 2025
Slide 29: Focus on product quality resulted in incremental economic impact
MMK’'s key development priorities Market overview MMK's achievements and growth plans Appendix TO BE A LEADER IN OPERATIONAL EXCELLENCE / LEADERSHIP IN PRODUCTION EFFICIENCY MMK’s FOCUS ON PRODUCT QUALITY RESULTED IN AN INCREMENTAL ECONOMIC IMPACT OF USD 15 MILLION Reduced rejection rate among autom
Slide 30: Production efficiency projects started in 2019-2020
2019 Started in 2020 = Started in Impact Impact EBITDA” (CAPEX EBITDA" usoQ5 min uso? 6Qnin uso 5 5 min +624 ths tonnes per year +560 ths tonnes per year (CAPEX usD 3 20m = 3.4 ka/t of pig iron Started in Impact USD 30 min +406 ths tonnes per year 12)
Slide 31: MMK is strengthening external cost management
MMK’'s key development priorities Market overview Appendix TO BE A LEADER IN OPERATIONAL EXCELLENCE / EXCELLENCE IN PROCUREMENT AND SUPPLY CHAIN MANAGEMENT MMK IS STRENGTHENING EXTERNAL COST MANAGEMENT The highly effective external cost management has delivered an incremental.EBITDA of about USD 9 m
Slide 32: Digital projects contribute towards strategy objectives
DIGITALISATION DIGITAL PROJECTS HAVE BEEN MAKING A SIGNIFICANT CONTRIBUTION TOWARDS OUR STRATEGY OBJECTIVES Total incremental EBITDA impact from digitalisation stood at USD 10 million in 2021 vs 2019 Data Science Forecast and optimisation models based on machine learning, digital twins, advanced ana
Slide 33: MMK's digital platform: core of digital transformation
MMK's key development priorities Market overview DIGITALISATION MMK’s achievements and growth plans Appendix MMK’s DIGITAL PLATFORM — THE CORE OF DIGITAL TRANSFORMATION Background: Explosive digital growth Volume of data stored ™B —all Number of connected data sources ths 2019 2021 2025 Source: Comp
Slide 34: Unmanned solutions hold considerable promise for MMK
ments and growth plans Appendix MMK's key development priorities Market overview MMK's achie DIGITALISATION UNMANNED SOLUTIONS HOLDS CONSIDERABLE PROMISE FOR MMK KAMAZ unmanned truck “(Sa Unmanned assistants will: * On-site capacity of 10 tonnes e cut OPEX of materials ¢ improve internal logistics p
Slide 35: Digital projects to reduce emissions into the atmosphere
MMK’'s key development priorities Market overview MMK's achievements and growth plans DIGITAL PROJECTS TO REDUCE EMISSIONS INTO THE ATMOSPHERE OQ Machine learning: monitoring accidental releases Machine learning: gas leak detection Project launch 2021 Project launch 2021 Expected impact Expected imp
Slide 36: MMK ensures employee safety through advanced technology
MMK's key development priorities Market overview MMK's achievements and growth plans 1/2 MMK ENSURES EMPLOYEE SAFETY THROUGH ADVANCED TECHNOLOGY e Detects when workers get dangerously close e Audio and visual alarms. in hazardous areas to machinery ¢ Visual records of breaches for the database e War
Slide 37: Health and safety awareness training and VR
MMK’'s key development priorities Market overview MMK's achievements and growth plans Appendix Health and safety q Embedding VR into awareness training OHS training Over About 26,0 000 2,000 20 * Bepeasaasimulation to enhance learning improvements: internal coaches trained Proposed trained * Visuali
Slide 38: Key pillars of MMK's strategy underpinned by digital initiatives
MMK’'s key development priorities Market overview MMK's achievements and growth plans Appendix THE KEY PILLARS OF MMK’s STRATEGY ARE UNDERPINNED BY DIGITAL INITIATIVES Estimated EBITDA impact ones initiatives palate ot digital USD min 20 30 To be the best Customer focus supplier 10 Superior product
Slide 39: Strategy envisages additional USD 780 million of EBITDA impact by 2025
MMK’'s key development priorities Market overview MMK's achievements and growth plans Appendix MMK’s DEVELOPMENT STRATEGY ENVISAGES AN ADDITIONAL USD 780 MILLION OF EBITDA IMPACT BY 2025 Average annual EBITDA impact in 2022-2025 | | | >| pos | Source: Company data and analysis. Superior product port
Slide 40: Strategy will boost MMK's production volumes and margins
MMK’'s key development priorities Market overview MMK’s achievements and growth plans erent THE STRATEGY WILL BOOST MMK’s PRODUCTION VOLUMES AND MARGINS Output of steel products” Output of premium products Share of self-sufficiency for Share of quality cost in min tonnes min tonnes electricity produ
Slide 41: Appendix
a APPENDIX
Slide 42: MMK is implementing a syngas project to reduce CO2 emissions
MMK’'s key development priorities Market overview MMK's achievements and growth plans Appendix MMK IS IMPLEMENTING A SYNGAS PROJECT TO SIGNIFICANTLY REDUCE CO: EMISSIONS Syngas utilisation project at Blast Furnace No. 11 CAPEX” IRR Timeline uso] @) 9 min 3 4. 2021 2022 2023 2024 2025 kt® Coke gas vw
Slide 43: Superior product portfolio
MMK’'s key development priorities Marke TO BE THE BEST SUPPLIER MMK's achievements and growth plans SUPERIOR PRODUCT PORTFOLIO © Higher share of high-margin products, regular portfolio updates (high-strength steel, new types of coating) © Incremental sales of steel to the construction industry © Lea
Slide 44: Customer focus
MMK’'s key development priorities Marke ents and growth plans TO BE THE BEST SUPPLIER CUSTOMER FOCUS Development of sales channels Average annual EBITDA impact in 2022-2025 Success metrics for 2025 +6 p.p. * Development of the Trading House, service centres, 15 Incremental sales through the sales ne
Slide 45: Leadership in production efficiency
MMK’'s key development priorities Marke TO BE A LEADER IN OPERATIONAL EXCELLENCE MMK's achievements and growth plans LEADERSHIP IN PRODUCTION EFFICIENCY Capacity expansion © Improved self-sufficiency for electricity © Development of oxygen production © Higher output at lower costs (commissioning of
Slide 46: Excellence in procurement and supply chain management
MMK's key development priorities Market overview MMK's achievements and growth plans TO BE A LEADER IN OPERATIONAL EXCELLENCE Appendix EXCELLENCE IN PROCUREMENT AND SUPPLY CHAIN MANAGEMENT Average annual EBITDA impact in 2022-2025 Development of category management to cut costs © Further development
Slide 47: Contacts
CONTACTS Russia, Magnitogorsk Kirova st., 93 Veronika Kryachko Head of IR +7 915 380 6266 [email protected] Yaroslava Vrubel Head of ESG +7 982 282 9682 [email protected] Trina Melnik Head of PR +7 905 898 7356 [email protected]