EVRAZ Q3 2021 TRADING UPDATE

28 October 2021 - EVRAZ plc (LSE: EVR; "EVRAZ" or the "Group") today has released its trading update for the third quarter of 2021.

Q3 2021 vs Q2 2021 HIGHLIGHTS

·     In Q3 2021, EVRAZ' consolidated crude steel output edged up by 1.0% QoQ, mainly due to larger production volumes at EVRAZ North America. Production at the Group's Russian operations decreased slightly QoQ amid scheduled capital repairs.

·     Total sales of steel products decreased by 8.2% QoQ, primarily due to slowdown of Russian construction products market accompanied by lower sales of railway and semi-finished products because of logistics restrictions on the route and detentions in ports amid inclement weather. This was partly offset by better performance QoQ of EVRAZ North America.

·     Total raw coking coal production fell by 2.3% QoQ following scheduled longwall movements at the Osinnikovskaya, Yerunakovskaya-8, Uskovskaya and Raspadskaya mines. In addition, the Raspadskaya-Koksovaya mine had to temporarily slow its operations because of difficult geological conditions. Output from the remaining assets increased during the quarter.

·     Total coking coal concentrate production, including both the Steel and Coal segments, decreased by 1.8% QoQ, mainly because of reduction of coke production at EVRAZ ZSMK. The Coal segment's standalone coal concentrate production remained at the level of Q2 2021.

·     External sales of iron ore products decreased by 10.1% QoQ, driven by the partial shift of sales to Q4 2021 amid temporary logistics restrictions westwards due to vessel delays.

·     External sales of vanadium products fell by 11.8% QoQ, mainly because of reduced global demand from the automotive sector amid the semiconductor shortage and slowdowns in the Russian oil, gas and rail sectors. In addition, some global steel mills scheduled major maintenance during the summer months.

Note. Numbers in this table and the tables below may not add up to totals due to rounding.

¹ Includes tonnes of pig iron

² In tonnes of pure vanadium

CONFERENCE CALL DETAILS

 A conference call to discuss the trading update will be held on Thursday, 28 October 2021, at:

·      07:30 (New York time)

·      12:30 (London time)

·      14:30 (Moscow time)

Key speakers:

·      Sergey Markov, Director, Marketing and operational planning

·      Alexander Erenburg, Vice President, Vanadium division

·      Evgeny Terekhov, Commercial Director, Coal division

·      Olesya Afanasyeva, Senior Vice President, CFO, EVRAZ North America

To join the call, please dial:

Access code: 5102389

To avoid any technical inconvenience, it is recommended that participants dial in 10 minutes before the start of the call.

The Q3 2021 trading update presentation will be available on the Group's website, www.evraz.com, on Thursday, 28 October 2021, at the following link: https://www.evraz.com/en/investors/reports-and-results/presentations/

FORWARD-LOOKING STATEMENTS

This document contains "forward-looking statements", which include all statements other than statements of historical facts, including, without limitation, any statements preceded by, followed by or that include the words "targets", "believes", "expects", "aims", "intends", "will", "may", "anticipates", "would", "could" or similar expressions or the negative thereof. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the Group's control that could cause the actual results, performance or achievements of the Group to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements, including, among others, the achievement of anticipated levels of profitability, growth, cost and synergy of recent acquisitions, the impact of competitive pricing, the ability to obtain necessary regulatory approvals and licenses, the impact of developments in the Russian economic, political and legal environment, volatility in stock markets or in the price of the Group's shares or GDRs, financial risk management and the impact of general business and global economic conditions. Such forward-looking statements are based on numerous assumptions regarding the Group's present and future business strategies and the environment in which the Group will operate in the future. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. These forward-looking statements speak only as at the date as of which they are made, and each of EVRAZ and the Group expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in EVRAZ' or the Group's expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based. Neither the Group, nor any of its agents, employees or advisors intends or has any duty or obligation to supplement, amend, update or revise any of the forward-looking statements contained in this document.

STEEL SEGMENT

Total production volumes

Note. Numbers in this table and the tables below may not add up to totals due to rounding.
¹ From Coal segment
² In tonnes of pure vanadium

In Q3 2021, pig iron production at the Group's Russian mills remained mostly flat QoQ.

Crude steel production edged down by 1.4% QoQ, driven by scheduled capital repairs at EVRAZ NTMK.

The total output of steel products rose by 1.0% QoQ, as EVRAZ ZSMK increased its production volumes by 6.1% QoQ through the processing of metal stockpiled during earlier capital repairs.

Output of iron ore products fell by 6.6% QoQ, mainly because of scheduled capital repairs at the Abagurskaya processing plant in September. This was partly offset by an increase in sinter production volumes of 2.6% QoQ at EVRAZ KGOK following the completion of scheduled maintenance and repairs.

Total sales volumes

Note. Numbers in this table and the tables below may not add to totals due to rounding.

¹ Includes tonnes of pig iron

² In tonnes of pure vanadium

In Q3 2021, external sales of steel products fell by 10.7% QoQ, driven by lower shipments of semi-finished and finished products in the reporting period.

Sales of semi-finished products fell by 7.2% QoQ because of logistics restrictions on the route and delays in ports amid inclement weather, although shipments from factories increased slightly. Sales volumes are expected to recover in Q4 2021.

Sales of finished products decreased by 14.3% QoQ, mainly due to slowdown of construction products market after the successful Q2 2021. The sales of construction products declined by 15.3% QoQ.

Sales of railway products decreased by 12.6% QoQ, primarily because of logistics restrictions on the route and delays in ports amid inclement weather.

Sales of iron ore products decreased by 10.1% QoQ, driven by a partial shift of sales to Q4 2021 amid temporary logistics restrictions westwards due to vessel delays.

External sales of vanadium products fell by 11.8% QoQ, mainly because of reduced global demand from the automotive sector amid the semiconductor shortage and slowdowns in the Russian oil, gas and rail sectors. In addition, some global steel mills scheduled major maintenance during the summer months.

Average selling prices

¹ Includes prices for pig iron

² US$/kgV

In Q4 2021, iron ore production volumes are expected to increase following the completion of repairs at EVRAZ KGOK's burning furnaces and crushing complex in September. Pig iron production volumes are expected to remain at the level of Q3 2021.

STEEL, NORTH AMERICA SEGMENT

Production and sales volumes

In Q3 2021, EVRAZ Regina's crude steel production increased by 5.7% QoQ, mainly because market demand remained high. Part of the increase was caused by a low-base effect following the planned maintenance outage in Q2 2021.

EVRAZ Pueblo's crude steel production increased by 38.6% QoQ as operations resumed from the unplanned downtime in June.

Sales of construction products dropped by 23.3% QoQ because of steel flow constraints following the unplanned downtime in steelmaking in Q2 2021.

Sales of flat-rolled and tubular products rose by 19.7% and 38.0% QoQ respectively, primarily because of the continued increase in market demand.

Average selling prices

In Q4 2021, steel production and sales volumes are forecasted to be flat QoQ as market sentiments remain strong in the product segments served by EVRAZ.

COAL SEGMENT

Production volumes

* Starting from 2021 Raspadskaya incl. Yuzhkuzbassugol and Mezhegeyugol, the data has been adjusted

In Q3 2021, overall raw coking coal output fell by 2.3% QoQ. The reduction was caused by scheduled longwall movements at the Osinnikovskaya, Yerunakovskaya-8, Uskovskaya and Raspadskaya mines. In addition, the Raspadskaya-Koksovaya mine had to temporarily slow its operations because of difficult geological conditions. Output from the remaining assets increased during the quarter.

Output of coking coal concentrate remained flat QoQ during the reporting period.

Sales volumes

External sales volumes of coking coal products declined by 10.8% QoQ following lower sales of raw coking coal amid change in the product mix in favour of coking coal concentrate to meet customer needs.

Shipments of coking coal concentrate were affected by a partial shortage of coal amid a large number of longwall movements at the Group's mines during the quarter. In addition, increased logistic burdens caused local disruptions in railcar and transport availability, which also limited shipments compared to the previous quarter.

Intersegment sales volumes of coking coal products fell by 8.9% QoQ, mainly because of the decrease in the supply of K-grade and KS-grade coal amid lower production volumes.

Sales of raw coking coal for 9m 2021 plunged by 73.2% YoY because of a high-base effect after the management's decision to sell off stockpiled materials in 2020 with the aim of lifting sales amid the prevailing downward trend in global coal prices and uncertainty caused by COVID-19 at the time.

Note: Starting from 2021, the methodology has been changed.

Average selling prices

In Q4 2021, raw coal production is expected to increase QoQ, mainly because of the stabilisation of production volumes at the Alardinskaya and Raspadskaya mines, the completion of longwall movements at the Osinnikovskaya and Yerunakovskaya-8 mines, and the launch of new equipment at the Raspadskaya-Koksovaya open-pit mine.

Notes:

Semi-finished products include slabs, billets, pipe blanks and other semi-finished products.

Construction products include beams, channels, angles, rebars, wire rods, wire and other construction products.

Railway products include rails, wheels, tyres and other railway products.

Flat-rolled products include commodity plate, specialty plate and other flat products.

Tubular products include large-diameter line pipes, ERW pipes and casings, seamless pipes and other tubular products.

Other steel products include rounds, grinding balls, mine uprights, strips, etc.

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