Growth and Dividends Investor presentation September 2017 Kyzyl - - PowerPoint PPT Presentation

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Growth and Dividends Investor presentation September 2017 Kyzyl - - PowerPoint PPT Presentation

Growth and Dividends Investor presentation September 2017 Kyzyl processing plant construction Disclaimer ward-looking statements that involve know n and unknown risks and uncertainties, many of which are beyond the Companys control and all of


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Investor presentation

September 2017

Kyzyl processing plant construction

Growth and Dividends

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SLIDE 2

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Disclaimer

This presentation includes for ward-looking statements that involve know n and unknown risks and uncertainties, many of which are beyond the Company’s control and all of which are based on the directors’ beliefs and expectations about future events. These forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions, predictions and other statements, which are other than statements of historical facts. The words “believe,” “expect,” “anticipate,” “intends,” “estimate,” “forecast,” “project,” “will,” “may,” “should”, “shall”, “could”, “risk”, “aims”, “plans”, “predicts”, “continues”, “assumes”, “positioned” and similar expressions or the negative thereof identify certain of the forward-looking statements. For ward-looking statements include statements regarding: strategies, outlook and growth prospects; future plans and potential for future growth; liquidity, capital resources and capital expenditures; gro wth in demand for products; economic outlook and industry trends; developments of markets; the impact of regulatory initiatives; and the strength of competitors. The for ward-looking statements in this presentation are based upon various assumptions and predictions, many of which are based, in turn, upon further assumptions and predictions, including, without limitation, management’s examination of historical operating trends, data contained in the Company’s records and other data available from third parties. Although the Company believes that these assumptions w ere reasonable w hen made, these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond its control, and the Company may not achieve or accomplish these expectations, beliefs or projections. Many factors could cause the actual results to differ materially from those contained in predictions or for ward-looking statements of the Company, including, among others, general economic conditions, the competitive environment, risks associated with operating in Russia and Kazakhstan, rapid technological and market change in the industries in which the Company operates, as well as other risks specifically related to the Company and its operations. Past performance should not be taken as an indication or guarantee of future results, and no representation or warranty, express or implied, is made regarding future performance. Neither the Company, nor any of its agents, employees or advisors intend or have any duty or obligation to supplement, amend, update or revise any of the forward-looking statements contained in this presentation. to reflect any change in their expectations or any change in events, conditions or circumstances on w hich such statements are based Nothing in this presentation constitutes an offer, invitation, recommendation to purchase, sell or subscribe for any securities in any jurisdiction or solicitation of any offer to purchase, sell or subscribe for any securities in any jurisdiction and neither the issue of the information nor anything contained herein shall form the basis of or be relied upon in connection with, or act as any inducement to enter into, any investment activity. To the extent available, the industry, market and competitive position data contained in this presentation come from official or third party sources. Third party industry publications, studies and surveys generally state that the data contained therein have been obtained from sources believed to be reliable, but that there is no guarantee of the accuracy or completeness of such

  • data. While the Company believes that each of these publications, studies and surveys has been prepared by a reputable source, the Company has not independently verified the data

contained therein. In addition, certain of the industry, market and competitive position data contained in this presentation come from the Company's own internal research and estimates based on the know ledge and experience of the Company's management in the market in w hich the Company operates. While the Company believes that such research and estimates are reasonable and reliable, they, and their underlying methodology and assumptions, have not been verified by any independent source for accuracy or completeness and are subject to change without notice. Accordingly, undue reliance should not be placed on any of the industry, market or competitive position data contained in this presentation. The information contained in this presentation has not been independently verified. Neither the Company, any of its affiliates, subsidiaries or subsidiary undertakings nor any of their respective advisors or representatives makes any representation or warranty, express or implied, and no reliance should be placed on the fairness, accuracy, completeness or correctness of the information or

  • pinions contained in this presentation. Percentages and certain amounts included in this presentation have been rounded for ease of presentation. Accordingly figures shown as totals in

certain tables may not be the precise sum of the figures that precede them. Neither the Company, or any of its affiliates, advisors or representatives accepts any liability w hatsoever (in negligence or otherw ise) forany loss howsoeverarising fromany information contained in the presentation.

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Polymetal today High-quality operating assets and growth projects

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˃ 6 operations in Russia, 1 in Kazakhstan and 1 in Armenia ˃ 1 POX facility and 4 major development projects ˃ Market cap of US$ 4.7 billion*, FTSE 250 constituent

Notes: *As at market close 20.09.2017

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> Deliver a significant and sustainable dividend > Ensure significant and profitable growth > Control costs and replace reserves at

  • perating mines

> Deliver medium-term growth at Kyzyl > Build and advance a long-term growth pipeline > Maintain highest standards of corporate governance and sustainable development

Simple strategic objectives and clear execution priorities

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| 5 1,269 1,400 1,470 1,420 1,470 80 280 330 1,269 1,400 1,550 1,700 1,800 2016A 2017E 2018E 2019E 2020E

Kyzyl Existing

  • perations

69% 77% 82% 87% 87% 2016A 2017E 2018E 2019E 2020E

Gold production, Koz of GE1

Notes: GE at 80:1 Ag oz/Au oz, 1:5 Cu mt/Au oz and 1:2 Zn mt/Au oz conv ersion ratios.

Share of gold in production1

We have robust growth profile

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5-year results: we deliver on production

| 6 900 1,090 1,190 1,220 1,260 952 1,168 1,312 1,267 1,269 2012 2013 2014 2015 2016

Guidance Actual

+6% +7% +10%

Annual production based on 80:1 Ag/Au ratio (Koz of GE)*

+4%

* Company historical gold equiv alent guidance recalculated using 80:1 Ag oz/Au oz conv ersion ratio.

+1%

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4.4% 3.1% 2.9% 3% 2.4% 2.3% 2.1% 2% 2.0% 1.9% 1.7% 1.7% 1.6% 1.5% 1.5% 1.5% 0.8% 0.7% 0.0% Polymetal FTSE 250 Centamin Pan American Centerra Acacia Yamana Tahoe Kinross Newmont Goldfields Barrick FTSE GM Anglogold Newcrest Agnico Eagle Eldorado Randgold New Gold

5Y Sector-leading dividend yield

27% 23% 5%

  • 6%
  • 15%
  • 25%
  • 39%
  • 49%
  • 50% -55%
  • 62%
  • 65%
  • 66% -68%
  • 71%
  • 71%
  • 76%
  • 78%
  • 81% -89%

Agnico Eagle Centamin Polymetal Randgold Fresnillo Gold Newmont Newcrest Silver FTSE GM Barrick Acacia Centerra Goldfields New Gold Kinross Tahoe Anglogold Yamana Eldorado

5Y* TSR

5-year results: dividend yield and TSR

Notes: Bloomberg data as at market close 29.08.2017 *since POLY IPO

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We have high-grade reserves

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Average reserve grade (2P reserves), g/t GE

Source: Company data. Gold, silv er, copper prov ed and probable reserv es as of 01.01.2017 GE at 80:1 Ag oz/Au oz and 1:5 Cu mt/Au oz conv ersion ratios.

4.2 3.8 6.3 2.8 3.6 2.9 2.3 1.9 1.7 1.6 1.4 1.4 1.4 1.3 1.3 1.3 1.1 1.1 1.1 1.0 0.9 0.9 0.7

Acacia Average Underground Open-pit Randgold Gold Fields Agnico Eagle Pan American Goldcorp Eldorado Iamgold Anglogold Fresnillo Barrick Newmont Yamana Newcrest Centamin New Gold Buenaventura Tahoe Kinross Centerra

Polymetal

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| 9 1,182 1,063 1,002 974 964 937 931 906 879 869 863 854 844 836 789 787 779 750 728 725 664 597

Harmony Anglogold IAMGOLD Gold Fields Kinross ACACIA Yamana Newmont Hochschild Agnico- Eagle Eldorado New Gold Tahoe Polymetal Goldcorp Newcrest Centamin Randgold Fresnillo Barrick Centerra Polyus

All-in sustaining cash costs for 12 months ending 30 June 2017, US$/oz of GE

Source: Companies’ data on co-product basis f or the 12 months ending 30 June 2017. Centamin, Centerra Gold, Tahoe: AISC reported on by -product basis Hochschild: AISC based on Ag/Au ratio of 74

US$ 1,259 oz – average LBMA gold price for the period

We control our costs

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| 10 145 157 145 150 170 47 45 50 50 50 32 86 145 80 30 30 30 224 288 370 310 250 2015A 2016A 2017E 2018E 2019E Long-term growth projects Kyzyl and POX expansion Exploration Stay-in-business CapEx

Capital expenditures, US$M

Our business model is capital-light

Notes: Long-term growth projects include Prognoz, Viksha and Nezhda. Total capital expenditure in 2015-2016 includes amounts pay able at the end of the period. On a cash basis, capital expenditure was US$ 271 million in 2016 (2015: US $ 205 million).

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We generate significant free cash flow

| 11 2.2 1.1 (1.1) OCF Capex FCF (Pre- M&A) Randgold 2.5 1.1 (1.4) OCF Capex FCF (Pre- M&A) Polymetal 2.8 0.3 (2.4) OCF Capex FCF (Pre- M&A) Fresnillo

Pre-M&A free cash flow in 2012-2016, US$ bn

Notes: Company data. Free cash f low (pre-M&A)

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… and we deliver meaningful cash returns to shareholders

Total Dividends and FCF for 2012-2016, US$ bn

1.1 1.1 0.3 0.9 0.2 1.1 Polymetal Randgold Fresnillo Pre M&A FCF Dividends

Notes: Company data. Free cash f low (pre-M&A)

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| 13 0.20 0.32 0.16 0.21 0.22 0.18 0.50 0.20 0.30 0.15 0.14 0.70 0.32 0.36 0.51 0.37 0.32

2012 2013 2014 2015 2016 1H 2017 Special at the discretion of the Board Regular (50% of underlying net income starting FY2017, before that - 30%)

Notes: 1) As at market close 23 August 2017 (includes interim div idend declared on 29 August 2017)

Dividends, US$ per share

> US$ 1,048 million paid out since IPO > Interim dividend for 1H 2017 increased by 55% y-o-y to US$ 0.14 per share > LTM yield of 4.7% > Average 5-year yield of 4.4%

(1) (1)

Track record of substantial dividend payments

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Liquidity profile

| 14 Robust liquidity profile: US$ 1.1 bn of undrawn credit facilities Current leverage at 2.19x Net Debt/ Adjusted EBITDA but is expected to decrease below 2.0x by year’s end Low cost of debt below 4% with an average maturity of >4 years Net debt of US$1.6bn*, 100% bilateral and denominated in US dollars

Notes: *As at 30.06.2017

New maturity profile, US$M

(long term loans only)

26 102 238 454 372 100 50 2018 2019 2020 2021 2022 2023 2024 46% 54% Fixed Floating Interest rate breakdown

(long term loans only)

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We deliver stronger production and FCF in the 2H

43% 45% 37% 39% 57% 55% 63% 61% FY 2014 FY 2015 FY 2016 FY 2017E

Revenue, %

1H 2H 45% 45% 41% 40% 55% 55% 59% 60% FY 2014 FY 2015 FY 2016 FY 2017E

Production, %

1H 2H 45% 45% 39% 55% 55% 61% FY 2014 FY 2015 FY 2016 FY 2017E

EBITDA, %

1H 2H

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FY2016 FY2017 Production, GE Koz 1,269 1,400 TCC, US$/GE oz 570 600-650 AISC, US$/GE oz 776 775-825 Capital expenditure, US$M 271 370 Free cash flow, US$M 257 Positive Regular dividend Paid Definitely Special dividend Paid Decisionin January*

Gold, US$/oz. 1,250 1,200 Silver, US$/oz. 17.3 16.0 RUR/USD rate 67 60 Brent oil, US$ 49 60

> We will deliver stronger production, lower costs and materially higher free cash flow in the 2H

FY2017 Outlook On track to deliver on production and cost guidance

*Based on FCF post regular dividends and gold price

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We continue to provide both valuation upside and meaningful current income

50x 50x 49x 46x 37x 36x 35x 35x 33x 32x 30x 30x 27x 26x 23x 17x 16x 16x 12x 12x 11x 8x 7x 7x

Agnico Eagle Yamana New Gold Kinross Hochschild Eldorado Anglogold Pan American Goldcorp Fresnillo Randgold Newcrest Newmont Gold Fields Barrick Tahoe Centamin Buenaventura Polymetal Oceana Gold Harmony Acacia Polyus Gold Centerra

2017E P/E

Source: Bloomberg data (Div idend y ield calculated in US dollars as of 25.08.2017, 2017 P/E updated as at 25.05.2017)

8.1% 4.7% 4.2% 4.2% 4.0% 4.0% 3.5% 2.0% 1.6% 1.1% 1.1% 1.1% 0.9% 0.9% 0.8% 0.8% 0.7% 0.7% 0.6% 0.6% 0.6% 0.5% 0.5% 0.4% 0.0% 0.0% Centamin Polymetal Tahoe Harmony Acacia FTSE 350 Polyus Gold Gold Fields Fresnillo Anglogold Randgold FTSE GM Newcrest Agnico Eagle Eldorado Hochschild Yamana Buenaventura Goldcorp Barrick Centerra Gold Pan American Newmont Oceana Gold Kinross New Gold

LTM Dividend yield

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Kyzyl and Amursk projects update

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Kyzyl is one of the best development-stage gold projects in the world

> Large: 7.3 Moz of gold reserves, of which 3.1 Moz is open pit > High-grade: 7.7 g/t with 6.9 g/t in the open pit > Excellent exploration upside: 3.1 Moz of additional resources at 6.8 g/t > Technology: Flotation followed by concentrate offtake or POX processing > LOM: 22 years (first 10 years open pit) > Low capital intensity: US$375M (open pit + flotation + POX expansion) > Robust economics:*

  • US$ 488/oz TCC
  • US$ 518/oz AISC
  • 33% IRR
  • US$ 750M NPV

Notes: *Based on 10% discount rate. the gold price of US$ 1,200/oz, RUB/USD exchange rate of 64 and Tenge/USD exchange rate of 300. .

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| 20 Permitting Engineering Contracting Construction Open pit Processing plant External Infrastructure 100 % 100% 100 % 95 % 100% 100 % 50 % 100 % 100 % 100 % 95 % 100 % Internal Infrastructure Tailings storage 100 % 100 % 100 % 80 % 100 % 100 % 95 % 50 %

Kyzyl Completion scorecard

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External power supply facilities (ETL и MSDS) 100% On-site & Auezov village boiler houses 100% Maintenance shop 75% Processing plant building 100%

Kyzyl infrastructure Progress

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Kyzyl Open pit

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> Expand the capacity of the existing POX plant by ~50% in terms of concentrate processed (now limited by the oxygen plant capacity) by debottlenecking the existing POX facility at low capital cost (US$ 55M) > Materially improve economics of the Kyzyl project by retaining ~50% of concentrate for in-house treatment at the POX by: > Increasing gold recovery from the Kyzyl concentrate to 95% > Bringing down processing and transportation costs > Strengthen Polymetal’s commercial position on the concentrate market vis-à-vis off- takers > Add development optionality for other refractory gold projects in the Company’s portfolio

Amursk POX expansion project Operating synergies with Kyzyl

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| 24 Permitting Engineering Contracting Construction

Hydrometallurgical plant

Oxygen station 2 Other processing

  • bjects

100 % 90% 65% 50% 100% 50% 30 % 100 % 80% 65% 40% 90 % Infrastructure 100 % 55 % 85% 0 %

Amursk POX expansion project Completion scorecard

Ramp up to full expanded capacity by 2H 2018

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Amursk POX expansion project Construction progress

Oxygen Plant No 2 30 % Cooling and neutralization area 55 % Leach tailings filtration area 30 % Dry coolers 50%

> Key additions to the equipment will comprise a 2nd oxygen plant, an autoclave discharge thickener, separate filters for thickener underflow, and upgrades for heat recovery and water treatment systems

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Further growth

  • pportunities
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Nezhda – a very large high-grade gold project

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> Substantial resource (JORC-compliant): 11 Moz of GE at 4.8 g/t of which 2.1 Moz at 3.8 g/t is open-pit > Low capital intensity and excellent fit with Polymetal’s core capabilities: processing via flotation followed by concentrate

  • fftake

> Polymetal entered into binding agreement to increase its current 17.7% stake to 24.7% for $8M with a call option to buyout the remaining 75.3% based on the results of an initial JORC-compliant reserve estimate at $100/oz of attributable gold reserves. The call option premium is $12M in cash. > The call option is exercisable in 2018 with the total consideration capped at $180M of which $10M will be paid in cash and the rest in shares. > First JORC-compliant reserve statement in 2H 2017 and development decision in Q3 2018

5 000 m 1 000 m

0-5 5-25 25-50 50-70 70-100 100, ceiling Legend, AU m*g/t

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Nezhda: progress

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2017 2018

Exploration  Geomechanical and mining method studies  Preparation of JORC-compliant MR estimate  Further exploration of ore zone 1 and adjacent areas to grow

  • pen-pittable resources
  • Upgrade of inferred resources

into indicated

Construction expected to start in 2019 with potential start of production in 2021

Technology  Pilot plant test-work  Hydrometallurgical studies (concentrate)  Study of concentrate thickening and filtration  Reagent mode optimization  Issue of operating procedure Design  Optimization of open-pit mining

  • Project documentation for

processing facility

  • Processing equipment

marketing

  • JORC-compliant CPR

Notes: Start of construction and production is subject to positiv e dev elopment decision

Design

  • Preparation and audit of PFS
  • Development of project

documentation Exploration

  • Continue exploration activities at

adjacent areas to grow open- pittable resources

  • Additional exploration of

potential ore zones for underground mining

  • Further upgrade of inferred

resources into indicated Development

  • Development decision
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Viksha – our first PGM asset

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Gram-meter (gm-m)

One of the largest open pittable PGM resources in the world

Consistent gram-meter (gm-m) down dip (Pd eq.* ore body width)

˃ 20-year mining licence granted on July 18, 2016 for a project area of 47km2 ˃ Mineral Resources: 213 Mt at 0.98 g/t of combined precious metals, total content at 6.6 Moz ˃ Processing: conventional flotation processing to produce bulk copper-PGM sulphide concentrate + off-take ˃ Average thickness: 7 m ˃ Depth of open pit: 150 m

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Viksha: project timeline

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2016 2017 2018 2019

Q1  License documents submitted for governmental approval Q2  Received governmental approval  New mining license granted Q4  Exploration program approved and being launched Q1  Geological engineering survey Q3

  • Pilot plant testwork

Q4

  • Confirmatory testwork

Q2

  • Exploration completed
  • Start of feasibility study development and reserves estimate

Q3

  • Submission of Russian FS to Subsoil agency (Rosnedra) and get reserves on balance
  • Bankable FS and development decision

Potential start of production in 2022

Notes: Start of production subject to positiv e dev elopment decision

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Prognoz – the largest undeveloped primary silver deposit in Russia

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* Estimated by Micon in 2009

Key facts Ownership: > 5% with an option to increase stake to 50% (investment decision to be made no later than Q1 2020) > the other 50% owned by financial investor and potentially available Mineral resources: 292 Moz at 586 g/t* silver, 3% lead Additional mineral potential: 7.9 - 18.1 Mt of ore at 469 g/t silver for 119 – 273 Moz of silver contained* Mining method: Open-pit (5-8 years), followed by underground Throughput: ~1 Mtpa Production: 20 Moz of silver per annum (100%) Capex: ~$250M (100%)

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Top silver development projects globally

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Source: Company reports, BMO Capital Markets

Silver grade, g/t 200 400 600 800 1000 200 400 600 800

Mangazeiskiy Juanicipio Prognoz Silvertip Los Gatos Webbs Terronera Fuwan Navidad La Preciosa Corani

Development projects – Ranked by Silver Grade

P+P M+I Inf. Ag grade, g/t Silver content, Moz

(BCM) (CDE) (CDE) (FRES;MAG) (POLY) (SBR) (DOWA) (Silv er Mines) (EXK) (MSV) (PAAS)

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Prognoz: project timeline

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2017

  • Focus on exploration (at least 25km of diamond drilling)
  • Start of technical study development and reserve estimate

2018

  • Preparation of preliminary feasibility study
  • No later than 31 March 2019 - completion of pre-feasibility study and externally audited JORC-compliant reserves

estimate followed by investment decision

2019

  • Preparation of the FS (combined mining method, reserves estimate)
  • Design of processing plant and infrastructure

2020

  • Completion of permitting stage
  • Development decision and start of construction

Potential start of production in 2023

Notes: Start of production subject to positiv e dev elopment decision

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Operating assets review

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Key facts:

> Location: Magadan Region, Russia > Life of mine: 2023 > Mining: Underground > Processing: 1.8 Mtpa concentrator and 425 Ktpa Merrill Crowe plant > Reserves (JORC): 2.1 Moz GE at 4.7 g/t including 142 Moz of silver at 327 g/t > Resources (JORC): 0.6 Moz GE at 13.3 g/t including 43 Moz of silver at 886 g/t > Employees: 1,897

Dukat

Operation Development Plant City

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Grade, (g/t)

Notes: GE produced at 80:1 Ag oz/Au oz; SE (silv er eq.) per oz sold based on actual realised prices (f or AISC)

1,574 1,711 1,817 1,938 967 338 400 416 435 228 1,912 2,111 2,233 2,373 1,195 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Ore Processed, Kt

Dukat concentrator Lunnoye plant

317 344 393 369 158 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Production (GE Koz)

6.0 5.8 6.4 5.6 4.7

13.9 10.9 7.8 8.0 10.2 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

AISC (US$/SE oz)

Dukat

1,253 1,468 1,656 1,661 817 168 191 201 183 92 394 384 401 435 286 16 5 1,815 2,043 2,258 2,279 1,215 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Ore mined, Kt

Dukat Goltsovoye Lunnoye Nachalny-2 Terem

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˃ Start of production from high-grade satellite deposits ˃ Perevalnoye (ore reserves of 350 Kt, at 5.9 g/t GE) in Q4 2017 ˃ Terem (mineral resources1 of 690 Kt, at 21.9 g/t GE) in Q1 2018 ˃ Primorskoye (mineral resources of 500 Kt, at 19.6 g/t GE) in Q3 2019 ˃ Step-out exploration at deeper flanks of Dukat and Lunnoye ˃ Removal of left-behind pillars and lower-grade stopes where no minimal development is needed through application of differentiated cut-off grade

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˃ Extend LOM to 2027 while maintaining stable costs ˃ Slow down grade erosion and production decline ˃ Improve processing capacity utilization

Notes: 1) Unaudited mineral resource estimate

Dukat: operational priorities

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Albazino

Key facts:

> Location: Khabarovsk Territory, Russia > Commissioning: 2009 > Life of mine: 2031 > Mining: Open pit/Underground > Processing: 1.6 Mtpa flotation circuit followed by POX and CIL processing at Amursk Hub > Reserves (JORC): 2.0 Moz GE , 4.2 g/t > Resources (JORC): 1.7 Moz GE , 5.3 g/t > Employees: 988

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Albazino

Grade, (g/t)

1,513 1,609 1,607 1,654 856 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Ore Processed, Kt

238 227 220 244 108 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Production (GE Koz)

5.6 4.8 5.2 5.0 4.8

1,139 901 667 684 893 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

AISC (US$/GE oz)

Notes: GE produced at 80:1 Ag oz/Au oz; GE (gold eq.) per oz sold based on actual realised prices (f or AISC)

1,338 1,566 1,583 1,866 830 49 267 161 1,338 1,566 1,632 2,133 991 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Ore mined, Kt

Open-pit Underground Total

86.0% 93.8% 94.0% 94.0% 96.1%

Recovery (POX), %

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˃ Acceleration of satellite open-pit development: ˃ Ekaterina 1 (ore reserves of 380 Kt at 3.5 g/t GE) ˃ Ekaterina 2 (ore reserves of 1,170 Kt at 2.6 g/t GE) ˃ Ekaterina 3 (ore reserves of 200 Kt at 3.5 g/t GE) ˃ Farida (mineral resources of 610 Kt at 4.0 g/t GE) ˃ Continued resource-to-reserve conversion in the underground mine ˃ Continued near-mine exploration

Albazino: operational priorities

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Stable production and costs for the next 10-12 years

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Mayskoye

Key facts:

> Location: Chukotka, Russia > Commissioning: 2011 > Life of mine: 2034 > Mining: Underground and open pit > Processing: 850 Ktpa flotation concentrator/CIL > Reserves (JORC): 1.4 Moz GE, 6.9 g/t > Resources (JORC): 3.2 Moz GE , 11.9 g/t > Employees: 977

Operation Development Plant Sea port / City

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Mayskoye

48 143 138 116 9

FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Production (GE Koz)

NR 1,134 935 1,242

FY 2013 FY 2014 FY 2015 FY 2016

AISC (US$/GE oz)

667 653 628 730 538

FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Ore mined, Kt

Grade, (g/t)

488 807 683 761 428

FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Ore Processed, Kt

Notes: GE produced at 80:1 Ag oz/Au oz; GE (gold eq.) per oz sold based on actual realised prices (f or AISC)

7.1 8.7 6.7 5.3 6.5

10.0 10.5 13.8 19.5 9.6

FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Underground development, Km

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˃ Debottlenecking of the CIP section to achieve design recovery levels for oxidised ore from the open pit ˃ Maintain safety, productivity and grade control underground ˃ Accelerate resource-to-reserve conversion both in the open pit and underground

Mayskoye: operational priorities

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Stable production for the next 8-10 years with 2017-2019 costs lower by 25-30% vs 2016

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Omolon

Key facts:

> Location: Magadan Region, Russia > Commissioning: 2010 > Life of mine: 2024 > Mining: Open pit/Underground > Processing: 850 Ktpa CIP and Merrill Crowe,1000 Ktpa HL > Reserves (JORC): 1.5 Moz GE, 3.7 g/t

  • CIP: 1.2 Moz GE at 6.8 g/t
  • HL: 0.3 Moz GE at 1.3 g/t

> Mineral resources (JORC): 0.6 Moz GE, 10.3 g/t

  • CIP: 566 Koz GE at 11.9 g/t
  • HL: 16 Koz GE at 1.9 g/t

> Employees: 725

Operation Development Depleted Plant City

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767 825 835 840 550 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Ore Processed, Kt

1,322 722 732 675 901 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

AISC (US$/GE oz)

Grade, (g/t)

147 213 188 170 93 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Production (GE Koz)

6.6 8.4 7.5 7.0 6.0

Omolon: operational statistics

Notes: GE produced at 80:1 Ag oz/Au oz; GE (gold eq.) per oz sold based on actual realised prices (f or AISC)

2,065 2,488 1,990 2,061 272 4 172 115 2,065 2,488 1,994 2,233 387 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Ore mined, Kt

Open-pit Underground Total

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SLIDE 46

˃ Smooth roll-over from older depleted ore sources (Tsokol, Dalneye) to Birkachan, Oroch ˃ Continued resource and reserve accretion at Olcha, Sopka, Nevenrekan, Yolochka ˃ Restart of Heap Leach operation at Birkachan

Omolon: operational priorities

| 46

˃ Stable production and costs for the next 7-8 years ˃ Advancing LOM extension options

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Omolon: production by ore source

| 47 825 835 840 850 850 850 850 8.4 7.5 7.0 7.6 7.0 7.9 7.0 2 4 6 8 300 600 900 1200 1500 2014 2015 2016 2017E 2018E 2019E 2020E Ore processed breakdown, Kt Birkachan Sopka Tsokol Olcha Dalneye Oroch Grade GE, g/t Grade GE, g/t

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| 48

> Location: North-western Kazakhstan > Commissioning: 2007 (operated by Poymetal since 2010) > Life of mine: 2029 > Mining: Open pit > Processing: CIL (2.5 Mtpa)/ flotation (1 Mtpa) > T

  • tal Reserves (JORC): 3.0 Moz GE, 1.6 g/t
  • Komar: 0.9 Moz GE at 1.8 g/t
  • Varvara & others: 2.1 Moz GE at 1.5 g/t

> T

  • tal Resources (JORC): 2.9 Moz GE, 1.8 g/t
  • Komar: 0.5 Moz GE at 2.2 g/t
  • Varvara & others: 2.4 Moz GE at 1.6 g/t

> Employees: 1,129

Key facts:

Varvara

Operation Development Plant City

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| 49

Notes: GE produced at 80:1 Ag oz/Au oz; GE (gold eq.) per oz sold based on actual realised prices (f or AISC)

2,782 649 338 911 3,676 3,664 3,457 3,119 1,560 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Ore Processed, Kt

Varvara and other Komar 1,088 1,049 1,092 975 1,026 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

AISC (US$/GE oz)

Grade, (g/t)

131 106 72 85 53 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Production (GE Koz)

1.5 1.2 0.9 1.1 1.5

Varvara: operational statistics

2,820 878 383 900 2,008 3,985 4,068 3,203 1,778 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Ore mined by source, Kt

Varvara Komar Total

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Varvara: operational priorities

| 50

> Full re-evaluation of ore reserves at Komar and Varvara based on additional drilling, factual costs and recoveries (Q4 2017) > Evaluation of in-pit waste storage at both Komar and Varvara with the goal to reduce operational footprint and cut costs by reducing average waste haulage distance twofold > Optimisation of the long-term mine plan for the hub as a whole with evaluation of strategic options for assets on the Russian side of the border (Tarutin, Maminskoye) > Continued active presence on the market for 3rd party ore

˃ Komar will drive a strong jump in production at Varvara in 2017 ˃ Stable production for the next 10-12 years ˃ Costs trending lower 15-20% vs 2016

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Key facts:

> Location: Khabarovsk Region, Russia > Commissioning: 2003 > Life of mine:

  • Okhotsk – 2019
  • Svetloye – 2024

> Mining: Open pit/Underground > Processing: 600 Ktpa Merrill Crowe, 1000 Ktpa HL circuit at Svetloye > Reserves (JORC): 0.9 Moz GE, 3.2 g/t average grade

  • Svetloye: 675 Koz GE at 2.8 g/t
  • Okhotsk: 201 Koz GE at 5.3 g/t

> Resources (JORC): 0.5 Moz GE, 5.2 g/t average grade > Employees: 1,182

Okhotsk

Operation Development Plant Sea port

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23 26 134 119 114 108 24 134 119 114 131 50 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Production (GE Koz)

Svetloye Okhotsk Total

| 52

Notes: GE produced at 80:1 Ag oz/Au oz; GE (gold eq.) per oz sold based on actual realised prices (f or AISC)

619 622 631 627 307 428 466 619 622 631 773 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Ore Processed, Kt

Okhotsk Svetloye Total 1,055 1,065 909 621 752 1,040 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

AISC (US$/GE oz)

Okhotsk: operational statistics

697 1,077 399 141 68 1,336 595 697 1,077 399 1,477 663 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Ore mined, Kt

Okhotsk Svetloye

Grade, (g/t) 7.5 6.7 6.2 4.9 3.3

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> De-bottlenecking heap leach stacking capacity at Svetloye given significant expansion in ore reserves following positive grade reconciliation after in-fill drilling and positive exploration results on the flanks > Continued exploration at smaller high-grade satellite deposits potentially providing feedstock at Khakanja (Khotorchan, Kundumi, Kirankan) > Advancing Levoberezhny, particularly the heap leachable oxide cap > Evaluation of strategic options for the Khakanja plant and associated smaller deposits

˃ Stable production at very low costs at Svetloye for the next 7-8 years ˃ Flexible ore source planning for Khakanja

Okhotsk: operational priorities

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| 54

Key facts:

> Location: Sverdlovsk Region, Russia > Commissioning: 2000 (HL), 2005 (CIP) > Life of mine: 2027 > Mining: Open pit > Processing: 950 Ktpa CIP circuit > Reserves (JORC): 0.9 Moz GE , 2.5 g/t > Resources (JORC): 0.8 Moz GE , 4.4 g/t > Employees: 874

Voro

Operation Development Plant City

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| 55

Notes: GE produced at 80:1 Ag oz/Au oz; GE (gold eq.) per oz sold based on actual realised prices (f or AISC)

924 915 924 1,001 498 850 747 450 319 180 1,774 1,662 1,375 1,321 678 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Ore Processed, Kt

CIP HL 692 515 391 419 473 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

AISC (US$/GE oz)

Grade, (g/t)

154 159 141 129 58 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Production (GE Koz)

3.6 3.7 3.4 3.6 3.5

Voro: operational statistics

11 11 10 10 5 FY 2013 FY 2014 FY 2015 FY 2016 1H 2017

Waste mined, Mt

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| 56

> Reserve estimate for Saum and Tamunier in 1H 2018 > Feasibility study for the joint development of Saum, North Kaluga and Tamunier with an upgrade of the existing CIP plant to include flotation circuit in Q3 2018 > Continue regional exploration and evaluation of bolt-on M&A opportunities

˃ Declining medium-term production and the cessation of mining at Voro in 2019 ˃ Stockpile processing in 2019-2027

Voro: operational priorities

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Key facts:

˃ Location: Kapan province, Armenia ˃ Acquired by Polymetal: April 2016 ˃ Mining: underground ˃ Processing: flotation concentration followed by offtake ˃ Life of mine: TBC in Q3 2017 ˃ Ore reserves: TBC in Q3 2017 ˃ Mineral resources (JORC):

  • Kapan 1.9 Moz GE , 4.0 g/t average grade
  • Lichkvaz 0.6 Moz GE , 4.2 g/t average grade

˃ Employees: 1,085

Kapan Our first Armenian operation

Yerevan

  • St. Petersburg

2400 km 320 km

Kapan project Lichkvaz

70 km

Azerbaijan Turkey Iran Armenia

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| 58

Notes: GE produced at 80:1 Ag oz/Au oz; GE (gold eq.) per oz sold based on actual realised prices (f or AISC)

64 224 247 1H 2016 2H 2016 1H 2017

Ore Processed, Kt

1,930 1,184 1,197 1H 2016 2H 2016 1H 2017

AISC (US$/GE oz)

Grade, (g/t)

6 19 25 1H 2016 2H 2016 1H 2017

Production (GE Koz)

4.2 3.9 4.5

Kapan: operational statistics

2 7 8 1H 2016 2H 2016 1H 2017

Underground development, Km

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> Carry on with improvement measures aimed at debottlenecking the underground mine > Undertake additional drilling to produce a JORC-compliant reserve estimate and a combined LOM for Kapan and Lichkvaz in Q3 2017 > Continue active exploration activities in the region

Kapan: operational priorities

A capital-light regional processing hub with sizeable production of more than 100 Koz of GE per annum

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| 60

Appendix

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| 61

Sustainability is the only way forward

strikes and lockouts

major environmental incidents

5.5%

staff turnover in 2016

0.2

LTIFR (4 fatalities in 2016)

US$13.6M

community investments 2014-16

42%

female qualified personnel

Member 2016/2017

25

cooperation agreements with communities

60

hours of training per person

11,261

people

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We are committed to delivering sustainable value

| 62

2016-2017 Sustainability highlights

> Signatory to the International Cyanide Management Code > Leaderfor Environmental management in WWF/UN rating > Completion of ESIA at Kyzyl (EBRD Environmental and Social Policy implemented) > CarbonManagementand Human Rights Policies signed > 50% reduction of extreme risks and 14% LTIFR reduction > Biodiversity conservation incorporated into corporate environmental management > Over 50 social service institutions renovated or upgraded in host communities

  • \
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| 63

Notes: Shareholder structure data as of 30 August, 2017

59% Free Float 27% ICT Group

(Alexander Nesis)

13% PPF

(Petr Kellner)

Christine Coignard Senior INED ex-MD HCF International Advisors Chair of the Remuneration Committee Jonathan Best INED ex-CFO of AngloGold Ashanti Chair of the Audit and Risk Committee Russell Skirrow INED ex-Chairman ML Metals/ Mining IB team Leonard Homeniuk INED ex-President of Centerra Gold Chair of the Safety and Sustainability Committee Jean-Pascal Duvieusart PPF Group ex-Managing Partner at McKinsey Konstantin Yanakov ICT Group Ltd ex-CFO of Polymetal Marina Gronberg Vitalbond Ltd and Vitaly Nesis Group CEO

Shares outstanding 430,112,661

1% Management & Directors

Bobby Godsell Chair Chairman of Business Leadership South Africa, ex-CEO of AngloGold Ashanti Chair of the Nomination Committee

We are committed to highest standards of corporate governance

INED Non-independent

  • 14% High net worth

individuals

  • 45% Institutional

investors

Shareholder structure Board of Directors

The majority of our Board is independent

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We operate in stable low-risk jurisdictions

| 64 Type of risk Recent issues in mining jurisdictions

  • utside FSU

Russia/Kazakhstan/Armenia Resource nationalism

> Tanzania – export ban on concentrate since March + possible introduction of 1% clearing fee on mineral export

  • value. Government blocks export of Petra diamond parcel

with risk of nationalisation > Indonesia - Freeport McMoran divests ownership to local aluminum producer under gov’t pressure Low risk No instances of government overreach

  • r licensing issues in hard rock mining

in more than 10 years

Tax regime

> Burkina Faso – adoption of new mining code abolishes a previous 10% tax break on mining company profits (now 27.5%) > South Africa – introduction of new 1% royalty on mine turnover > Zambia – increased electricity tariffs for copper mines Stable tax regime Relatively low corporate and sector taxation levels No recent changes to royalty rates and mineral extraction tax; Corporate tax rates stable at 20% since 2009 in Russia and Kazakhstan, and since 2006 in Armenia

Environmental /regulatory/ community limitations

> Greece and some other EU countries – ban on project development for environmental reasons in many locations > Philippines – ban on open-pit mining and closure of several operating mines involved in production of nickel for environmental reasons > Colombia – project suspension by government after community anti-mining vote Low risk No material issues

Labour issues

> South Africa miners’ strikes, examples of illegal miners invades to mine sites Low risk None, unemployment rates at a low 5.3% in Russia, 4.9% in Kazakhstan and 17.4% in Armenia Labour strikes extremely rare; labour unions only traditionally influential in coal mining

Source: Publicly av ailable data

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1H 2017 1H 2016 Change, % (1) FY 2016 Revenue, US$M 683 593 +15% 1583 Adjusted EBITDA, US$M 257 293

  • 12%

759 Adjusted EBITDA margin 38% 49%

  • 11%

48% Total cash cost (TCC), US$/GE oz 656 514 +28% 570 All-in sustaining cash cost (AISC), US$/GE oz 906 754 +20% 776 Net earnings/ (loss) for the period, US$M 120 165

  • 27%

395 Underlying net earnings, US$M 117 125

  • 6%

382 Underlying EPS, US$/share 0.27 0.29

  • 7%

0.90 Dividend declared during the period, US$/share (2) 0.18 0.13 +38% 0.37 Dividend proposed for the period, US$/share 0.14 0.09 +56% 0.37 Net operating cash flow, US$M 35 65

  • 46%

530 Capital expenditure, US$M 193 117 +65% 271 Free cash flow (pre M&A), US$M (3) (163) (53) +208% 257 30-June-17 31-Dec-16 Net debt, US$M 1,582 1,330 (4) +19% Net debt/Adjusted EBITDA (5) 2.19 1.75 +25%

Financial highlights

Notes: (1) % changes can be different from zero even when absolute amounts are unchanged because of rounding. Likewise, % changes can be equal to zero when absolute amounts differ due to the same reason. (2) 1H 2017: f inal dividend for FY 2016 paid in May 2017. 1H 2016: final dividend for FY 2015 paid in May 2016. (3) Net cash generated by operating activities less capital expenditures. (4) As at 31 Dec 2016. (5) On a last 12 months basis

| 65

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Impact of Rouble appreciation on AISC

| 66 754 906

AISC 1H 2016 Domestic inflation Mining tax change - Au&Ag price USD rate change Au/Ag ratio change Average grade processed Changes in sales structure Other AISC 1H 2017

AISC reconciliation, US$/oz

Source: Company data GE based on actual realised prices

  • 41

˃ AISC driven mostly by the increase in TCC as a result of continued Russian Rouble strengthening which was partially offset by the robust operating performance at Varvara, Kapan and Svetloye (Okhotsk hub). ˃ We remain on track to meet the FY2017 AISC guidance of US$ 775-825/GE oz. + 37

  • 5
  • 6

+ 139 + 1 + 28

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Financial performance is heavily dependent on the RUB/USD exchange rate and oil price dynamics

| 67 Labor, 24% Fuel, 20% Services, 23% Grid power, 4% Non-fuel consumables, 21% Royalty, 8% $ / RUB / Tenge RUB/ Tenge Oil $ / Au Oil / RUB / Tenge RUB / Tenge

RUB, 41% Tenge , 9% $, 20% Oil, 30%

OpEx Structure, $/oz

> A 1 RUB movement in domestic currency will have an US$8/oz effect

  • n TCC
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| 68

RUB, 20% $, 40% Tenge, 40%

Project Capex

(Kyzyl + Amursk + LT projects)

Sustaining Capex

RUB, 50% $, 20% Tenge, 30%

> A 10% devaluation of domestic currencies will have approx. 8% effect on the sustaining capex or ~US$8/oz > A 10% devaluation of domestic currencies will have approx. 6% effect on the project capex (US$175M in 2017) or ~US$11 million

Capital expenditures also sensitive to FX dynamics

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Reserves and resources

| 69

2.1 1.5 2.0 1.4 0.9 0.9 3.0 7.3 0.9 19.9 0.6 0.6 1.7 3.2 0.5 0.8 2.9 3.1 2.5 1.9 0.7 18.6

Dukat Omolon Albazino Mayskoye Okhotsk Voro Varvara Kyzyl Kapan Nezhda Other Total

Reserves Resources

Notes: Reserv e and resource statement (JORC 2012) as at 01.01.2017 including updates f rom Dolinnoy e and Nezhda. Gold and silv er price assumptions of $1,200/oz and $16/oz respectiv ely . *Assuming a reasonable resource-to-reserv e conv ersion 1) Includes Kapan and Lichkv az mines 2) Kuty n, Veduga

GE Moz 4.7 3.7 4.2 6.9 3.2 2.5 1.6 3.9

Reserve grade, g/t

2.7 2.0 3.7 4.7 1.4 1.7 5.9 1.6 38.6 2023 2024 2031 2034 2024 2027 2029 LOM 7.7 2039 4.1 10.4 2.5 N/A N/A

* *

1 2

N/A 1.9