Slide 1: Corporate Presentation June 2016
CORPORATE PRESENTATION June 2016
Slide 2: 1. Overview
1. OVERVIEW a, '~¢
Slide 3: Established gold producer: Who we are
Established gold producer Who we are #9 globally by production (2015, moz) #4 globally by P&P reserves (2015, moz) 6,1 92 5,0 74 69 4,0 64 3,5 52 2,6 46 41 2,5 2,2 2,1 33 1,8 1,5 28 21 Barrick Kinross Polyus Anglogold Sibanye Navoi MMC Goldcorp Newcrest Newmont Goldfields Barrick Polyus Sibanye Angl
Slide 4: Why Polyus?
Established gold producer Why Polyus? Level 1 listing on MOEX obtained in April 2016 implying the Company will intend to raise its free float to at least 10% from 4.5%. The Company is #9 globally by gold output and #4 globally by gold reserves One of the lowest cost producers globally with TCC of $4
Slide 5: Operating in a gold-rich region
Established gold producer Operating in a gold-rich region Russia is #3 globally by production (2015, moz) 14,8 #1 in Russia Polyus 1.8 moz in 2015 20% of the 8,8 8,6 Russian production 6,9 5,5 5,4 5,1 4,3 3,6 3,1 3,0 2,7 2,0 2,0 1,9 China Australia Russia United Peru South Canada Mexico Indone
Slide 6: Who we are: production by mine
Established gold producer Who we are Burgakhchany Russian Federation Natalka Blagodatnoye Nezhdaninskoye1 Titimukhta Olimpiada Kuranakh Panimba Chortovo Koryto Alluvials Razdolinskoye Verninskoye Bamskoye FY15 gold production by mine Kuranakh 8% Alluvials 11% Russian Federation Operating mines Verni
Slide 7: Developing largest gold mines in the world
Established gold producer Who we are Developing largest gold mines in the world Largest gold assets by output in 2015, koz Largest gold assets by resources in 2015, moz Muruntau (Uzbekistan) 1 961 Pebble (US) 107,7 Grasberg (Indonesia) 1 360 Grasberg (Indonesia) 104,8 Polyus Krasnoyarsk cluster (Rus
Slide 8: Highest EBITDA margin among peers
Established gold producer Who we are Highest EBITDA margin among peers EBITDA margin of Russian metals & mining companies, % EBITDA margin of global peers, % Polyus 58 +13ppts Polyus 58 45 +13ppts 45 Alrosa 53 +8ppts 40 45 Agnico Eagle 38 +2ppts Norilsk 50 48 +2ppts Gold Fields 39 0ppts 39 NordGold
Slide 9: Average reserve grade and life of mine
Established gold producer Who we are Average grade in reserves as of 2015, g/t 4,2 2,9 2,4 2,2 Average grade is 1.8 g/t 1,4 1,4 1,3 1,1 1,1 1,1 0,7 Polymetal Gold Fields Agnico Eagle Polyus Newcrest AngloGold Barrick Goldcorp Newmont Sibanye Kinross Average life of mine, years (based on 2015 data) 3
Slide 10: Strategy targets
Established gold producer Strategy targets Extensive reserve and Strong operational profile resources base Development of the resource base via Focus on the CIS as a home region which is delivery of profitable ounces rich in undeveloped resources Focus on operational efficiency Lowest cost Top-1
Slide 11: FY15 achievements
Established gold producer FY15 achievements The first CIS company to join the ICMM LTIFR of 0.08, down 11% from 0.09 in FY14 Strategic Asset Review well underway identifying a portfolio of attractive low- cost brownfield growth options Total gold output of 1,763 koz, up 4% y-o-y Positive effect fr
Slide 12: 2. Corporate Governance
2. CORPORATE GOVERNANCE a, '~¢ cr rs)
Slide 13: Corporate development
Corporate governance Corporate development Polyus corporate structure changes Since 2012 Polyus Gold International (PGIL) was a premium LSE listed company with a 22% free-float In November 2015, Wandle Holdings (the vehicle of the largest shareholder of PGIL) consolidated 100% of PGIL through th
Slide 14: Corporate development: previous and current structure
Corporate governance Corporate development Polyus Gold previous corporate structure Polyus current corporate structure (prior to 17 November 2015) Principal holding company BoD with Independent Eurobonds Directors Polyus Gold International (PGIL) Appropriate level of LSE premium listing corp
Slide 15: Establishment of the new Board
Corporate governance Establishment of the new Board The new Board A new composition of Polyus’ Board of Directors was formed and approved at the Company’s AGM on April 5, 2016. The new Board comprises of 9 members - 3 independent Directors, 3 representatives of the controlling shareholder and 3
Slide 16: Buyback
Corporate governance Buyback Buyback and the changes in the shareholder structure Shareholder structure before the buyback Current shareholder structure (prior to 11 March 2016) (post 27 May 2016) 307,204 shares (0.16%) bought back Free float (4.69%) from minority shareholders Free float (4.53%) Pol
Slide 17: 3. Operational Performance
3. OPERATIONAL PERFORMANCE a, '~¢ cr rs)
Slide 18: Strong growth profile
Operational performance Strong growth profile Total gold output rose by 7% in 2013-15 to 1,763 koz Sustained production increases achieved at key assets: Olimpiada, Blagadatnoye, Verninskoye, Kuranakh Within 2 years the Company increased its average recoveries by 3.4 ppts and treatment volumes by 10
Slide 19: Strong growth profile: production dynamics
Operational performance Strong growth profile Gold production dynamics, FY 2008-2015, koz1 1 763 1,800 1 696 1 652 1,760 1 569 1 381 1 277 1 222 1 231 2008 2009 2010 2011 2012 2013 2014 2015 2016F (Guidance) 1 Total gold produced represents refined gold output plus gold contained in concentrate 19
Slide 20: Improving operational performance at key assets
Operational performance Improving operational performance at Polyus’ key assets Recovery rate (%) and productivity per hour (t/h) Recovery rate (%) and productivity per hour (t/h) at Olimpiada at Blagodatnoye 661 657 643 660 672 669 667 665 673 724 720 704 623 942 968 930 891 866 928 914 522 513 534
Slide 21: FY15 operational achievements
Operational performance FY15 operational achievements Continued operational improvements drove gold output 4% up y-o-y Total gold output for the year of 1,763 koz, up 4% y-o-y, exceeding the upper end of the guidance range of 1,630-1,710 koz for FY15 The average recovery for the Group totaled 84.5%,
Slide 22: Total Operational Efficiency Program
Operational performance Total Operational Efficiency Program TOE objectives TOE initiatives Aimed to introduce quick-win measures that do not Equipment productivity improvement require significant investments: Application of new reagents Measures with proven economic effect Recovery rate inc
Slide 23: Production System: long-term performance growth trajectory
Operational performance Production System: long-term performance growth trajectory Year-by-year performance xx Maturity and continuous improvement effect improvement, percent on the basis of Production System 8 6 4 We are here 3 Organization based on 2 Share best practices continuous 25-30 Managemen
Slide 24: Krasnoyarsk Business Unit development
Operational performance Krasnoyarsk Business Unit (KBU) development 1 Reconfiguration of the Titimukhta mill for a 25% capacity increase Modification of the Titimukhta mill to process high-grade ore of Olimpiada instead of the lower grade Titimukhta ore, coupled with an increase in throughput capaci
Slide 25: Key initiatives at Verninskoye and Kuranakh
Operational performance Key initiatives at Verninskoye and Kuranakh Verninskoye Kuranakh The mine was commissioned at the end of 2011. In 2014, it JORC reserves: 2.4 moz (@1.4 g/t) reached the design throughput capacity, in 1H15 it reached the design recovery JORC reserves: 3.8 moz (@2.6 g/t) Pla
Slide 26: Construction of power supply infrastructure
Operational performance Construction of power supply infrastructure Razdolinskaya-Taiga 220 kV grid Peleduy-Mamakan 220 kV grid Project potential and goals Project potential and goals Construction of the grid is a prerequisite for: Solving the regional power shortage issues at the Bodaybo District
Slide 27: Natalka development
Operational performance Natalka development Review of the block model 2H 2015 At the beginning of 2014 Polyus initiated a thorough revision of the Natalka project, including a review of the resource block model to ensure the incorporation of all newly available information. The review of the blo
Slide 28: Kuranakh, a turnaround example
Operational performance Kuranakh, a turnaround example Kuranakh in FY13 MINING IMPROVEMENTS Kuranakh in FY15 Optimisation of ore transportation The highest-cost, underperforming Logistic improvements An average cost producer with a asset within the portfolio without Blasting works enhancements
Slide 29: 4. Financial Performance
4. FINANCIAL PERFORMANCE a, '~¢ cr rs)
Slide 30: FY15 financial highlights
Financial performance FY15 financial highlights Item FY14 FY15 change y-o-y Gold production, koz 1,696 1,763 4% Average realised gold price excl. SPPP, $/oz 1,275 1,155 -9% Average realised gold price incl. SPPP, $/oz 1,300 1,221 -6% Total cash cost (TCC), $/oz 585 424 -28% All-in-sustaining costs (
Slide 31: TCC benchmarking
Financial performance TCC benchmarking Polyus’ evolution on the global TCC curves in FY13 - FY15 1 200 FY15 TCC, $/oz FY14 1 000 FY13 POLYUS 800 POLYUS FY13 FY14 600 POLYUS FY15 400 Cumulative production, % 200 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Highlights Top-10 global majors’ TCC in FY15,
Slide 32: AISC benchmarking
Financial performance AISC benchmarking Global AISC curve in FY14-FY15 1 400 AISC, $/oz 1 200 POLYUS in 1 000 FY14 800 FY15 600 FY14 POLYUS in 400 FY15 Cumulative production, % 200 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Highlights Top-10 global majors’ AISC in FY15, $/oz The Group’s FY15 AISC
Slide 33: EBITDA margin and cost performance
Financial performance EBITDA margin and cost performance EBITDA margin, TCC and AISC breakdown by mine TCC ($/oz) AISC ($/oz) EBITDA margin (%) 64% 66% 59% 40% 39% 42% 745 725 748 609 598 582 535 498 444 416 417 345 Olimpiada Blagodatnoye Titimukhta Verninskoye Alluvials Kuranakh 33
Slide 34: Debt maturity profile
Financial performance Debt maturity profile Debt repayment schedule (as of 1 May 2016), $ mln 2 665 Total liquidity position 2,314 1,906 622 Committed credit lines 622 Cash & cash 772 1 692 742 equivalents 1,284 420 259 29 Liquidity position Liquidity position 2016 2017 2018 2019 2020 2021+ of PJSC
Slide 35: Debt and cash structure
Financial performance Debt and cash structure Net debt & cash evolution of PJSC Polyus (estimated as of 1 May 2016) 3 560 1 825 1,284 364 As of 31 December 2015 As of 1 May 2016 Net debt, $mln Cash position, $mln Net debt & cash evolution of Polyus Gold International (estimated as of 1 May 2016) 3 1
Slide 36: Capex analysis
Financial performance Capex analysis Capex breakdown, $ mln change FY15 FY14 y-o-y Natalka 111 310 (64%) Olimpiada 39 56 (30%) Blagodatnoye 13 17 (24%) Titimukhta 1 6 (83%) Verninskoye 21 38 (45%) Kuranakh 10 6 67% Alluvials 5 17 (71%) Exploration 7 6 17% Other 61 69 (12%) Total 268 525 (49%) Mainte
Slide 37: Strategic Price Protection Programme overview
Financial performance Strategic Price Protection Programme overview The revenue stabiliser structure until FY15 (2 tranches) The current revenue stabiliser structure (tranches 1-2) $1,720/oz $1,704/oz Knock-in $1,603/oz Knock-in barrier barrier $1,603/oz $1,542/oz $1,528/oz $1,491/oz $1,491/oz $1,37
Slide 38: Credit ratings
Financial performance Credit ratings downgrades …until January 2015, when Since the issuance of Eurobonds in 2013, to current Polyus’ credit ratings were set Polyus’ credit rating trailed the sovereign by 1- BB- ratings on par with Russia’s sovereign 2 notches…. by both S&P rating and Fitch April 20
Slide 39: 5. 1Q 2016 Performance
5.1Q 2016 PERFORMANCE a, '~¢ cr rs)
Slide 40: 1Q16 performance highlights: operational
1Q 2016 performance 1Q16 performance highlights Operational performance Item 1Q15 1Q16 change y-o-y Olimpiada1 161.6 151.3 -6% Blagodatnoye 91.6 100.2 9% Titimukhta1 29.1 28.4 -2% Poputninskoye - 1.5 N.M. Verninskoye 37.2 55.9 50% Alluvials 0.2 0.2 0% Kuranakh 33.0 37.9 15% Refined gold, koz 352.7 3
Slide 41: 1Q16 performance highlights: financial
1Q 2016 performance 1Q16 performance highlights Financial performance1 Item 1Q15 1Q16 change y-o-y Revenue, $mln 505 511 1% Weighted-average refined gold selling 1,271 1,260 -1% price (incl. SPPP), $/oz Average LBMA price, $/oz 1,218 1,183 -3% Total cash cost (TCC), $/oz 410 357 -13% All-in-sustaini
Slide 42: 6. Appendix: Gold Market Developments
6. APPENDIX GOLD MARKET DEVELOPMENTS
Slide 43: Supply and demand highlights
Gold market developments Supply and demand highlights Global gold supply and demand, tonnes 2015 global gold demand by source, % 5 452 Central Bank buying 4 555 4 445 4 597 4 456 4 462 4 443 4 348 13% 4 297 4 340 4 359 3 846 Physical investment Jewelry 23% 56% 2010 2011 2012 2013 2014 2015 Industrie
Slide 44: Gold market fundamentals
Gold market developments Gold market fundamentals Global physical investment, tonnes Total ETF holdings, tonnes 1,700 2 838 2 532 1,380 2 293 1,283 1,119 1 923 1 880 1,008 1,021 1 738 1 604 17% 24% 15% 19% 17% 20% 26% 24% 20% 25% 19% 21% 21% 20% 17% 15% 19% 22% 2010 2011 2012 2013 2014 2015 Europe U
Slide 45: Disclaimer
Disclaimer The information contained herein has been prepared using information available to PJSC Polyus at the time of preparation of the presentation. External or other factors may have impacted on the business of Polyus and the content of this presentation, since its preparation. In addition all