2Q2014 IFRS Consolidated Financial Results October 15, 2014 0 - PowerPoint PPT Presentation

2Q2014 IFRS Consolidated Financial Results October 15, 2014 0

Alexander Ivannikov First Deputy Head of the Department for Finance and Economics 1

Disclaimers This presentation has been prepared by OJSC 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. 2 2

Summary of Financial Results 2Q2014 vs. 2Q2013 Gazprom Group results 2Q 2014 YoY Total net sales 1,315 bn RR 19% Adj. EBITDA 281 bn RR -36% Net Profit (1) 228 bn RR 13% Operating cash flow 298 bn RR -32% Free cash flow 76 bn RR -47% Net debt (2) 895 bn RR -20% Net debt/Adj.EBITDA LTM 0.5x 1. Profit for the period attributed to owners of OAO Gazprom 2. Compared to Net debt as of December 31, 2013 2Q2014 IFRS Consolidated Financial Results 3

Hydrocarbon Production, Electricity and Heat Generation Natural Gas, bcm Gas Condensate, mln ton Crude Oil, mln ton 200 6,0 15 - 4 % + 3.6 % 0 % 150 4,0 10 100 137,2 5 2,0 131,6 3,9 3,8 3,6 3,6 8,7 3,4 8,6 8,6 8,6 8,3 108,5 104,8 103,7 50 0 0,0 0 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 Electricity generation, bn kWh Heat generation, mln Gcal 60 - 7.7 % + 18.3 % 80,0 40 60,0 40,0 42,7 41,8 20 36,3 34,7 33,5 49,0 20,0 32,3 18,1 15,3 8,8 0,0 0 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 Including Russian generating companies: Mosenergo, OGK-2, TGK-1 2Q2014 IFRS Consolidated Financial Results 4

Russian Natural Gas Balance Bcm 2Q2013 2Q2014 Natural gas sources 164.2 164.4 Domestic gas production 152.1 151.5 Other sources including Central Asian and Azerbaijani gas 9.3 8.0 Gas withdrawn from underground storage in Russia, Latvia and Europe 1.9 3.0 Decrease in the amount of gas within the gas transportation system 0.9 1.9 Natural gas distribution 164.2 164.4 Domestic consumption 90.9 90.3 including needs of the gas transportation system and underground storages 8.3 7.5 Gas pumped into underground storages 23.3 17.0 Gas for LNG production 3.3 3.5 Foreign supplies (including the Baltic States) 38.3 39.1 FSU supplies (including the Republic of Ossetia and Georgia) 7.7 12.9 Increase in the amount of gas within the gas transportation system 0.7 1.6 Source: Company operating data 2Q2014 IFRS Consolidated Financial Results 5 5

Gas Sales Gas Sales in Europe and Other Countries (2) Gas Sales in FSU Countries Gas Sales in Russia Net sales (1) Net sales (3,4) Net sales (3,4) RR bn RR bn RR bn + 8% + 1% + 136% 300 250 400 250 200 200 300 150 484 150 299 399 458 257 200 400 396 100 100 136 131 142 127 131 100 126 110 50 50 58 0 0 0 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 Volumes and prices Volumes and prices (5) Volumes and prices (3,5) bcm bcm bcm US$/mcm US$/mcm RR/mcm 400 362 4 000 3551 3535 381 380 372 3470 375 90 3386 400 140 358 3015 276 276 120 60 300 241 3 000 239 300 - 6% - 2% 100 60 + 57% 80 200 2 000 200 60 30 30 85 100 40 48 1 000 47 73 100 40 41 39 43 20 41 37 17 16 15 14 9 0 0 0 0 0 0 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 Calculations may diverge due to rounding. 1. Net of value added tax (VAT); 2. Other countries include LNG sales to Argentina, China, Japan, Korea, Nigeria and Vietnam; 3. VAT is not charged on sales to FSU, Europe and other countries; 4. Net of custom duties; 5. Gross average price including custom duties 2Q2014 IFRS Consolidated Financial Results 6 6

Oil and Energy Businesses Net Sales (1) 2Q2014 2Q2013 60% Crude oil and gas condensate; refined products 58% Gas business and other revenues Electric and heat energy 36% 7% 33% 6% Crude Oil and Gas Condensate; Refined Products Electric and Heat Energy + 27% + 16% RR bn RR bn 134.6 468.4 150 500 124.6 418.1 430.0 404.4 120 400 368.0 84.1 72.7 90 71.4 300 60 200 30 100 0 0 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 Calculations may diverge due to rounding. 1. Net of value added tax (VAT) 2Q2014 IFRS Consolidated Financial Results 7

2Q2014 vs. 2Q2013 Changes of Operating Expenses Items Main drivers of change +/- RR bn (+/- %) +28 Due to an increase in the tax rate for gas from RR 582 to RR 700 per mcm since Taxes other than on income (+18%) Jan. 1, 2014, and an increase in the tax rate on oil extraction from RR 470 to RR 493 per ton + 20 Purchased gas and oil (+11%) Cost of purchased gas increased by RR 9 bn or 7%; and cost of purchased oil increased by RR 11 bn or 22% relating to activity of Gazprom Neft Group + 15 Staff costs (+13%) Relates to average salary indexation and increase in average number of personnel + 128 Charge for impairment provisions (+758%) Mainly driven by accrual of provision for doubtful trade accounts receivable of NAK Naftogaz Ukraine + 17 Materials (+31%) Mainly relates to consolidation of OAO MIPC from Sept. 2013, increase of + 28 purchases of materials from third parties and increase in prices Cost of goods for resale, inc. refined products (+81%) Mainly due to increase in volumes of refined products purchased from third + 79 parties Exchange rate differences (+210%) Driven from depreciation of Euro and U.S. dollar against Rouble in 2Q2014 and appreciation of Euro and U.S. dollar against Rouble in 2Q2013 Changes in inventories of finished goods, work + 31 in progress and other effects (34%) Due to an increase in the balances of inventories and finished goods + 43 The rest of OpEx (+13%) 0 50 100 150 Total OpEx: + RR 390 bn (+51%) The rest of OpEx include: Depreciation; Transit of gas, oil and refined products; Repairs and maintenance; Electricity and heating expenses; Social expenses; Transportation services; Rental expenses; Insurance expenses; Processing services; Research and development expenses; Heat transmission; Derivatives gains (losses); Other OpEx. 2Q2014 IFRS Consolidated Financial Results 8