2015 IFRS CONSOLIDATED FINANCIAL RESULTS APRIL 28, 2016 Igor - PowerPoint PPT Presentation

2015 IFRS CONSOLIDATED FINANCIAL RESULTS APRIL 28, 2016

Igor Shatalov First Deputy Head of the Department 2 2015 IFRS CONSOLIDATED FINANCIAL RESULTS

DISCLAIMERS This presentation has been prepared by JSC Gazprom (the “Company”), and comprises the slides for a presentation to investors concerning the Company. This presentation does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares or other securities representing shares in the Company, nor shall it or any part of it nor the fact of its presentation or distribution form the basis of, or be relied on in connection with, any contract or investment decision. Any viewer of this presentation considering a purchase of such securities is hereby reminded that any such purchase should be made solely on the basis of the information contained in the prospectus or other offering document prepared in relation thereto and will be subject to the selling restrictions set out therein. No reliance may be placed for any purposes whatsoever on the information contained in this presentation, or any other material discussed at any presentation or on its completeness, accuracy or fairness. The information in this presentation should not be treated as giving investment advice. Care has been taken to ensure that the facts stated in this presentation are accurate, and that the opinions expressed are fair and reasonable. However, the contents of this presentation have not been verified by the Company. Accordingly, no representation or warranty, express or implied, is made or given by or on behalf of the Company or any of its members, directors, officers or employees or any other person as to the accuracy, completeness or fairness of the information or opinions contained in or discussed at this presentation. None of the Company or any of their respective members, directors, officers or employees nor any other person accepts any liability whatsoever for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection therewith. The information in this presentation includes forward-looking statements. These forward-looking statements include all matters that are not historical facts, statements regarding the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of operations, financial condition, liquidity, prospects, growth, strategies, and the industry in which the Company operates. By their nature, forward-looking statements involve risks and uncertainties, including, without limitation, the risks and uncertainties to be set forth in the prospectus, because they relate to events and depend on circumstances that may or may not occur in the future. The Company cautions you that forward looking statements are not guarantees of future performance and that its actual results of operations, financial condition and liquidity and the development of the industry in which the Company operates may differ materially from those made in or suggested by the forward-looking statements contained in this presentation. In addition, even if the Company’s results of operations, financial condition and liquidity and the development of the industry in which the Company operates are consistent with the forward-looking statements contained in this presentation, those results or developments may not be indicative of results or developments in future periods. The information and opinions contained in this presentation are provided as at the date of this presentation and are subject to change without notice. No person is under any obligation to update or keep current the information contained herein. By attending the presentation you agree to be bound by the foregoing limitations. 3 2015 IFRS CONSOLIDATED FINANCIAL RESULTS

2015 - 1H 2016 HIGHLIGHTS Government decree on dividends Apr. 2016 Gazprom’s Management Committee proposed RUB 7.40 per share dividend for 2015 Gazprom placed CHF 500 million Eurobonds Mar. 2016 EUR 2 billion loan facility from Bank of China. The largest bilateral loan in Gazprom’s history Dec. 2015 Gas export growth to Europe in 2015 (+8% y-o-y) Oct. 2015 Gazprom placed € 1 bn Eurobonds Sep. 2015 Gazprom, BASF, E.ON, ENGIE, OMV and Shell signed Shareholders Agreement on Nord Stream 2 project May. 2015 Gazprom and CNPC signed the Heads of Agreement for pipeline gas supply from Russia to China via the Western route Feb. 2015 Dagong rating agency assigned 'AAA' credit rating to Gazprom and confirmed the rating in April 2016 4 2015 IFRS CONSOLIDATED FINANCIAL RESULTS

SUMMARY OF FINANCIAL RESULTS RR bn 2014 vs 2015 +9% +9% 6,073 +26% +26% (4%) +6% +6% 2,083 +395% +395% 1,875 (40%) 2,031 787 390 4 3 1 2 Total net sales Adj. EBITDA Net profit Operating CF Free CF Net debt 1 EBITDA adjusted by changes in impairment provisions 2 Profit for the period attributed to owners of PJSC Gazprom 3 Free cash flow is calculated as Net cash provided by operating activities less Capital expenditures 4 Compared to Net debt as of December 31, 2014 5 2015 IFRS CONSOLIDATED FINANCIAL RESULTS

HYDROCARBON PRODUCTION, ELECTRICITY AND HEAT GENERATION Natural gas production Gas condensate production Crude oil production bcm mln ton mln ton (6%) +6% +6% +1% +1% 600 30 60 +8% +8% (1%) +4% +4% 444.9 44.0 43.5 419.5 400 40 20 15.3 14.5 200 20 129.0 10 123.9 11.1 11.0 4.1 3.8 0 0 0 2014 2015 4q14 4q15 2014 2015 4q14 4q15 2014 2015 4q14 4q15 Electricity generation Heat generation bn kWh mln Gcal (5%) (7%) 125.2 117.1 180 (7%) (12%) 155.4 147.9 120 150 90 120 90 60 45.8 40.4 45.1 41.7 60 30 30 0 0 2014 2015 4q14 4q15 2014 2015 4q14 4q15 Including Russian generating companies: Mosenergo, OGK-2, TGK-1, MIPC Calculations may diverge due to rounding. 6 2015 IFRS CONSOLIDATED FINANCIAL RESULTS

GAS SALES Russia Europe & OC 2 FSU VOLUMES AVERAGE PRICE IN FSU VOLUMES AVERAGE PRICE IN RUSSIA VOLUMES AVERAGE PRICE IN EUROPE & OC bcm RR/mcm bcm USD/mcm bcm USD/mcm 400 300 100 300 262 3,641 3,779 352 3,507 3,523 349 4000 400 221 80 194 300 182 246 229 3000 200 300 200 60 200 2000 200 40 100 100 184 234 221 159 100 48 1000 100 20 40 76 59 71 37 11 13 0 0 0 0 0 0 2014 2015 4q14 4q15 2014 2015 4q14 4q15 2014 2015 4q14 4q15 +24 24% RR bn RR bn RR bn 2,166 2000 2000 1,752 2000 1600 1600 1600 (2%) +40 40% +4% 1200 1200 1200 821 806 735 +29 29% (0%) 800 800 800 525 430 412 268 267 400 400 138 400 107 0 0 0 2014 2015 4q14 4q15 2014 2015 4q14 4q15 2014 2015 4q14 4q15 1 3,4 3,4 NET SALES TO FSU NET SALES TO RUSSIA NET SALES TO EUROPE & OC Calculations may diverge due to rounding. 1 Net of value added tax (VAT) 2 OC - Other countries: include LNG sales 3 VAT is not charged on sales 4 Net of custom duties and excise tax 7 2015 IFRS CONSOLIDATED FINANCIAL RESULTS

SUSTAINABLE FREE CASH FLOW GENERATION Conse servativ ive financi ancial l polic icy: : 10 year ars of positi itive FCF Free Cash Flow 1 USD bn 80 55.7 60 54.7 50.5 2.9 48.1 47.4 10.8 40.9 4.0 17.2 13.7 40 33.5 12.1 28.2 6.4 23.4 3.2 52.8 20.0 2.2 43.4 43.9 20 3.8 34.3 33.2 28.7 27.1 25.0 21.2 16.2 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 23.6 Operating Cash Flow Cash CAPEX Free Cash Flow Gazprom self funding 2 200% 185% 180% 157% 152% 160% 134% 140% 125% 124% 108% 120% 100% 85% 80% 2013 2014 2015 4q14 1q15 2q15 3q15 4q15 1 Free Cash Flow = Net Cash from operating activities – Cash CAPEX 2 Net Cash from operating activities /Cash CAPEX 8 2015 IFRS CONSOLIDATED FINANCIAL RESULTS

CAPITAL EXPENDITURES Gazprom Group’s CapEx 1 RR bn USD bn 3000 80 70 2500 60 2000 (19 19%) +19% 46.4 50 (4%) %) 1,693 1,475 1,423 37.5 1500 40 (26%) 27.9 30 1000 20 500 10 0 0 2013 2014 2015 2013 2014 2015 TRANSPORT PRODUCTION OF NATURAL GAS PRODUCTION OF CRUDE OIL AND GAS CONDENSATE REFINING ELECTRIC AND HEAT ENERGY OTHER CAPEX CASH CAPEX 1 CapEx volumes and breakdown as provided in Management Report 9 2015 IFRS CONSOLIDATED FINANCIAL RESULTS

DIVIDEND PAYOUT Dividend per share 14 120% RUB/ Share 107% 12 100% 90% 10 8.97 80% 8 5.99 7.2 7.2 60% 6 40% 3.85 27% 26% 4 24% 2.39 25% 15% 20% 12% 0.36 9% 2 5% 16% 9% 1% 7% 0 0% 2008 2009 2010 2011 2012 2013 2014 DIVIDENDS AS % OF IFRS NET INCOME RAS BASED DIVIDEND PAYOUT RATIO 10 2015 IFRS CONSOLIDATED FINANCIAL RESULTS