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Credit Suisse Global Steel & Mining Conference
22-23 September 2010
Disclaimer                                                                                                                                                  02



This document does not constitute or form part of and should not be construed as, an offer to sell or issue or the solicitation of an offer to buy or
acquire securities of Evraz Group S.A. (Evraz) or any of its subsidiaries in any jurisdiction or an inducement to enter into investment activity. No part
of this document, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or
investment decision whatsoever. No representation, warranty or undertaking, express or implied, is made as to, and no reliance should be placed
on, the fairness, accuracy, completeness or correctness of the information or the opinions contained herein. None of Evraz or any of its affiliates,
advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this
document or its contents or otherwise arising in connection with the document.
This communication is only being distributed to and is only directed at (i) persons who are outside the United Kingdom or (ii) investment
professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) or (iii) high
net worth companies, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such
persons together being referred to as “relevant persons”). Any person who is not a relevant person should not act or rely on this document or any
of its contents.
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 Evraz’s control that could cause the actual results, performance or achievements of Evraz to be
materially different from future results, performance or achievements expressed or implied by such forward-looking, 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 our 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 Evraz’s present and future business strategies and the
environment in which Evraz Group S.A. 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 Evraz 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’s expectations with regard thereto or any change in events,
conditions or circumstances on which any such statements are based.
Neither Evraz, 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.


The information contained in this document is provided as at the date of this document and is subject to change without notice.
Evraz’s Global Business   03
Growth Strategy                                                                                                04



   Product mix improvements
   ◦   Modernisation of rail mills enabling the production of high value-added products
   ◦   Upgrade of wheel shops
   ◦   Shift to production of American Petroleum Institute certified slabs and other enhanced quality higher
       margin steel products
   ◦   Product mix expansion geared to local market demand (new rebar grades, beams, pipe blanks, sheet)
   ◦   Exploring opportunities for development of construction steel rolling capacities in regions with high
       demand

   Raw material base development
   ◦   Development of a coal deposit in Yerunakovsky region of Kuzbass
   ◦   Expansion of resource base and development of the Mezhegey coal deposit
   ◦   Increase of own iron ore production and supplementary exploration at existing sites

   Cost-saving measures
   ◦   Implementation of pulverised coal injection projects at the Russian steel mills to eliminate usage of
       natural gas in blast furnaces and reduce consumption of coking coal. Added effect will be an increase
       in pig iron production volumes and, therefore, crude steel production
   ◦   Cost saving programmes in place, yielding US$20-30m efficiency gains a year at each plant

  Increase in production volumes
   ◦   Reconstruction of 4th converter and 3rd slab machine at NTMK should increase crude steel output
       by up to 0.5 mtpa
   ◦   Considering construction of a second converter shop at NTMK with additional crude steel capacity of
       1.5-2.0 mtpa
1H 2010 Financial Summary                                                                                                                                                05




US$ mln unless otherwise stated                                               1H 2010                                1H 2009                          Change


Revenue                                                                          6,379                                  4,639                              38%

Cost of revenue                                                                 (5,296)                                (4,297)                             23%

SG&A                                                                              (750)                                  (595)                             26%

Adjusted EBITDA*                                                                  1,154                                    468                           147%

Adjusted EBITDA margin                                                              18%                                    10%

Net Profit/(Loss)**                                                               (270)                                  (999)

EPS (US$ per GDR)                                                                 (0.64)                                (2.52)


Net Debt***                                                                      7,198                                  7,783                              (9)%
Short-term Debt***                                                                1,740                                 3,937                            (56)%


Steel sales volumes**** (’000 tonnes)                                             7,714                                 6,823                              13%


 *   Adjusted EBITDA represents profit from operations plus depreciation and amortisation, impairment of assets, revaluation deficit, foreign exchange loss (gain) and
    loss (gain) on disposal of PP&E. See the appendix on p.29 for reconciliation of profit (loss) from operations to Adjusted EBITDA
 ** If cost model of accounting for PP&E were applied, net result would have been a profit of approximately US$146 million for the 1H 2010
 *** As of the end of the reporting period
 **** Here and throughout this presentation segment sales data refers to external sales unless otherwise stated
1H 2010 Financial Highlights                                                                                                                  06



                                                                               Consolidated Revenue by Segment
◦   Group revenue rose by 38%, largely driven by increase in
    sales volumes of steel products and higher average          US$ mln                                                          6,379
                                                                 7,500                                                414
    prices                                                                                                            290
                                                                                         4,639                                   1,120
◦   Group EBITDA advanced by 147% reflecting revenue
                                                                 6,000

                                                                 4,500
                                                                              343
                                                                              138         652
    expansion and cost control
◦
                                                                 3,000                                                           5,796
    Mining segment EBITDA more than quadrupled, largely                                  4,291
                                                                 1,500
    due to the growth in iron ore and coal prices
◦
                                                                    0
                                                                                         (785)
    EBITDA margin improved from 10% in 1H09 to 18% in                                                                            (1,241)
                                                                -1,500
    1H10                                                                                 1H09                                      1H10
                                                                                 Steel   Mining    Vanadium     Other operations    Eliminations




                           Revenue Drivers                                         Consolidated Adjusted EBITDA
       US$ mln                                                  US$ mln
    7,000                               1,121       6,379
                                                                 1,400                                                              1,154
    6,000                     619                                                                                           85
                                                                 1,200                                                               81
    5,000        4,369
                                                                 1,000
                                                                                                                                     390
    4,000
                                                                  800
                                                                                          468
    3,000                                                         600
                                                                                 70
    2,000                                                         400                      94
                                                                                                                                     738
    1,000                                                         200                      389

       0                                                            0           (34)
                                                                                 (51)                                               (140)
            1H09 Revenue    Volumes     Prices   1H10 Revenue     -200
                                                                                          1H09                                     1H10
                                                                          Steel                                      Mining
                                                                          Vanadium                                   Other operations
                                                                          Unallocated subsidiaries & eliminations
Cost Dynamics                                                                                                                                                                   07



◦   Growth in scrap, coking coal and iron ore prices in 1H                                                       Cash Cost*, Slabs & Billets
    2010 increased steelmakers’ costs                                                   US$/t

◦   This cost increase was significantly offset by Evraz’s
                                                                                      450
                                                                                      400
                                                                                                   402
                                                                                                                     430

    high level of vertical integration into iron ore and coking                                    394
                                                                                                                   420
                                                                                                                                                                         341
                                                                                      350
    coal                                                                                                                                             285
                                                                                      300
◦   Consolidated cost, approx. 65% of which is Rouble                                 250
                                                                                                                                       253                                324

    denominated, was negatively impacted by 10% Rouble                                200                                             224
                                                                                                                                                       268

    appreciation vs. US dollar compared to 1H09
                                                                                      150
◦   Increase in cash cost of coking coal concentrate                                               1H08             2H08              1H09            2H09                1H10

    resulted from lower production volumes due to
                                                                                                                                   Slab              Billet
    postponed longwall repositioning at the Ulyanovskaya
    mine                                                                                    * Average for Russian steel mills, integrated cash cost of production, EXW



           Consolidated Cost of Revenue, 1H 2010                                                           Cash Cost, Russian Coking Coal and
                                               7%                                                                  Iron Ore Products
                                13%                                                     US$/t
                                                          10%
                                                                                       75
                          15%                                                                                                                                              69
                                                                                                                      63
                                                                12%                    65
                                                                                                     56                                                                         55
                                                                                       55                                61
                          6%                                   5%
                                                                                                                                                        47
                                                          5%                                                                             43
                                11%                                                    45            50
                                                     7%                                                                                                     47
                                       4% 5%                                                                                            43
                                                                                       35
            Iron ore                  Coking coal              Scrap
                                                                                                    1H08             2H08              1H09                2H09                1H10
            Ferroalloys               Purchased semis          Auxilliary materials
            Electricity               Natural gas              Staff costs                                         Coal concentrate                    Iron ore products, 58% Fe
            Transportation            Depreciation             Other
                                                                                        Source: Management accounts
EBITDA to FCF Reconciliation                                                                                                                                      08




    US$ mln


    1600

               1,154           (51)
    1200                                     1,103           (258)
                                                                            (101)
                                                                                             744           (308)
    800
                                                                                                                          (397)
    400
                                                                                                                                           12            51
       0
              Adjusted      Non-cash       EBITDA Changes in Income tax                   CF from      Interest and       Capex         CF from       Free cash
              EBITDA          items       (excl. non-   working   paid                    operating      covenant                       investing       flow*
                                          cash items)    capital                          activities       reset                        activities
                                                         (excl.                                         payments                          (excl.
                                                      income tax)                                                                        capex)



*    Free cash flow comprises cash flows from operating activities less interest paid, covenant reset charges, cash flows from investing activities
Developments: Capital Markets                                                                                   09



◦    RUB15bn (equivalent to US$500 million) 3-year bonds issued in March 2010, swapped into US dollars to
     minimise Rouble currency exposure

◦    In May 2010, Evraz drew down US$950 million 5-year Gazprombank loan and repaid US$1,007million VEB loan

◦    In June-July 2010, Evraz refinanced US$357 million Nordea Bank loan due 4Q10 with new 4-year Nordea loan
     facilities in the amount US$404 million




                               Proportion of Short-term Debt to Total Debt
                               Proportion of Short-term Debt to Total Debt
    US$ mln
      10,000                                                                                         100%
                     8,482                           7,923                                 7,873
       8,000                                                                                         80%

       6,000        46%                                                                              60%

       4,000                                         25%                                             40%
                                                                                          22%
       2,000                                                                                         20%

          0                                                                                          0%
                   30-Jun-09                        31-Dec-09                            30-Jun-10

                                       Total Debt            Short-term Debt, % of Total Debt
Balanced Debt Maturity Profile                                                                                                                     10



◦         Total debt of approx. US$7.9bn, net debt of US$7.2bn as of 30 June 2010

◦         Consolidated cash balance of not less than US$500 million constantly maintained

◦         Liquidity (defined as cash and cash equivalents, amounts available under credit facilities and short-term bank
          deposits with original maturity of <3 months) totalled approx. US$1,598 million as of 30 June 2010

◦         Declining cost of capital (bond yields have decreased from approx. 10% in October 2009 to around 6%) reflects
          improvements in Evraz’s performance and market conditions and permits further refinancing of short-term debt
◦         We intend to further decrease our leverage and extend debt maturities



           Debt Maturities Schedule (as of 30 June 2010)
           Debt Maturities Schedule (as of 30 June 2010)                                         Breakdown of Short-term Debt*
                                                                                                 Breakdown of Short-term Debt*
                                                                                                      (as at 30 June 2010)
                                                                                                      (as at 30 June 2010)
US$ mln                                                                        US$ mln
2,000
                                  1,778

1,600                                             1,543
                                          1,419
                                                                                                593                                  786
1,200      1,085
                   996

    800                    721
                                                                        509
    400
                                                          15     11                                     279
     0
           2010    2011    2012   2013    2014    2015    2016   2017   2018             Syndicated loans     Overdrafts       Russian bilateral loans
                          Q1      Q2       Q3       Q4                             * Principal debt (excl. interest accrued)
Steel: Geographic and Product Mix Change                                                                                                                  11




◦   Recovery in demand for construction and railway products in Russian market raised the proportion of finished
    products in the portfolio
◦   Share of construction products increased from 25% to 32%
◦   Share of semi-finished products fell from 40% to 29%
◦   Share of Group’s sales volumes in the Russian market increased from 29% to 33% following recovery in domestic
    demand
◦   Domestic sales of Russian and Ukrainian operations advanced from 44% to 53%


          Steel Product Sales Volumes by Operations
          Steel Product Sales Volumes by Operations                                         Steel Sales Volumes by Product
                                                                                            Steel Sales Volumes by Product
’000 tonnes                                                             ’000 tonnes
 6,000           5,532
         5,187                                                          3,000   2,704
 5,000                                                                                           2,470
                                                                        2,500       2,262
              export
 4,000                                                                                       1,834
                                                                        2,000
                  47%
 3,000   56%                                                            1,500                                                  1,304
                                                                                                                 974     887
 2,000                                                                  1,000                              821
                                 1,276
                  53%      944
                                                                                                                                       391 436
 1,000    44%                                     603                    500
                                            413           279   303                                                                               186268
          domestic
    0                                                                      0
         Russian &       North American     European    South African              Semi-    Construction   Railway      Flat-rolled    Tubular   Other steel
         Ukrainian                                                               finished
                                  1H09    1H10                                                                   1H09    1H10
Steel: CIS Domestic                                                                                                                    12



◦   Real demand for finished steel increased from approx. 70% of pre-crisis peak level to approx. 80% with significant
    fluctuations in apparent demand due to destocking/restocking cycles
◦   Sales volumes of steel products to CIS market expanded by 31%
◦   Sales volumes of construction steel and railway products rose 38% and 31% respectively
◦   Prices of key products strengthened in response to demand recovery and growth in raw material prices and remain
    close to export parity level
◦   Government infrastructure spending is currently supporting demand for construction and infrastructure steel, as
    well as railway products, in the Russian market


                  Steel Product Sales Volumes                                         Steel Product Revenues

    ‘000 tonnes                                                           US$ mln
                                                                         2,000                                               1,885
3,500                                                                    1,800                                               213
                                                            2,954
3,000                                                                    1,600
                                                            338                                                              527
                                                                         1,400
2,500               2,262
                                                                         1,200         1,106
                    242                                     767
2,000                                                                    1,000          116
                    586
1,500                                                                      800          346
                                                                          600                                                996
1,000                                                      1,565
                    1,137
                                                                          400           527
 500
                                                                          200
                    297                                     284                         117                                  149
    0                                                                       0
                    1H09                                    1H10                        1H09                                 1H10

                  Semi-finished   Construction   Railway   Other steel              Semi-finished   Construction   Railway   Other steel
Steel: CIS Export                                                                                                                 13



 ◦       Strong underlying demand from developing countries
 ◦       Some correction in prices due to supply pressure of Chinese steel in Asian markets associated with cancellation
         of export rebates in China
 ◦       Export sales of steel products declined by 12% in volume terms reflecting the switch of volumes towards the CIS
         market and higher volumes of slab re-rolling within the Group (+0.4 million tonnes)
 ◦       Increase in production of slabs vs. billets to take advantage of more favourable pricing environment
 ◦       Delayed effect of rising steel prices due to the fact that export prices are typically fixed one to three months
         ahead of production



                        Steel Product Sales Volumes                                       Steel Product Revenues
                                                                          US$ mln
          ‘000 tonnes                                                                                                           1,290
                                                                          1,400
                                                                                                                       48
4,000                                                                     1,200           1,099
                                                                                    106                                          279
                        2.925                                   2,578     1,000
3,000                                                                                      233
              225
                                                       67                  800
                         566                                                                                                     526
                                                                  535
2,000                                                                      600
                                                                                           542
                        1,577                                    1,080     400
1,000
                                                                           200                                                   437
                                                                  896                      218
                         557
     0                                                                       0
                        1H09                                     1H10                     1H09                                   1H10

                          Slabs   Billets   Construction    Other steel                     Slabs   Billets   Construction   Other steel
Steel: North America                                                                                                                14




◦       Gradual recovery in demand driven by economic improvements and the onset of regional governments’
        infrastructure spending
◦       Shale gas exploration projects generate strong demand for small diameter pipe
◦       Sales volumes of steel products increased by 35%
◦       Flat-rolled steel volumes increased by 56%; construction steel by 5 times
◦       Pricing of steel products generally follows scrap price trends




                    Steel Product Sales Volumes                                     Steel Product Revenues

    ‘000 tonnes                                                        US$ mln
                                                                                                                             1,327
                                                                       1400
                                                                                     1,142
1,400                                                       1,276      1200

1,200                                                                  1000                                                    601
                     944                                     436
1,000                                                                    800          630
 800                384                                                  600
 600                                                         468                                                               408
                                                                         400          262
 400                297
                                                             181         200                                                   172
 200                226                                                               224
                                                             191                                                               146
    0               37                                                    0           26
                    1H09                                    1H10                     1H09                                     1H10

                     Construction   Railway   Flat-rolled    Tubular                  Construction   Railway   Flat-rolled    Tubular
Steel: Europe, South Africa                                                                                                            15




◦     Domestic demand in Europe remains weak and mostly related to public projects
◦     Temporary shutdown of steelmaking in the Czech Republic:
          ◦    Evraz Vitkovice Steel temporarily closed its steelmaking operations from July 2010 due to the price
               dispute with the supplier of liquid pig iron
          ◦    Rolling capacities in the Czech Republic are operating at the same rate
          ◦    The shutdown had no material economic impact on Evraz’s production volumes and costs
◦     Domestic demand in South African market remains weak, with approx. 25% of South African steel volumes
      exported


                   Steel Product Sales Volumes,                                      Steel Product Sales Volumes,
                       European Operations                                             South African Operations
    ‘000 tonnes                                                   ‘000 tonnes

    700                                          603
    600                                     10
                                                                   400
    500             413                                                                                                      303
                                                                                          279
    400       10                                                   300                                               8
                                                 511
                                                                                 4
    300                                                                                   106
                                                                   200                                                       196
    200             361
                                                                                           51
    100                                                            100
                                                  82                                      118                                 97
     0               42
                                                                     -                                                        2
                    1H09                         1H10
                                                                                         1H09                                1H10
                    Construction   Flat-rolled   Other steel                    Semi-finished   Construction   Flat-rolled   Other steel
Benefiting from Rising Prices for Iron Ore and Coal                                                                                                       16



                                                                                     Raw Material Prices (Domestic Markets)
                                                                                     Raw Material Prices (Domestic Markets)
◦    Volumes of coking coal mined decreased due the                    US$/t
                                                                      400
     repositioning of longwall at Ulyanovskaya mine
◦    Mining segment revenue doubled and EBITDA                        300

     quadrupled reflecting the growth in prices
                                                                      200
◦    A decline in coking coal supplies, following the
                                                                      100
     Raspadskaya mine explosion, led to lower external
     sales of coke and a negative EBITDA effect of approx.             0
     US$5 million per month                                                 Jan-09     Apr-09       Jul-09      Oct-09    Jan-10      Apr-10            Jul-10

                                                                              Scrap, Russia, CPT                         Scrap, USA
                                                                              Iron ore concentrate, Russia, ExW          Coking coal concentrate, Russia, FCA



                      Iron Ore and Raw Coal Production                            Mining Segment Revenue* and EBITDA
        ‘000 tonnes
                                                                       US$ mln
    18,000
                                        2,015
    15,000        2,131
                                                            2,351                                                                  1,120
                                                                       1,200
    12,000                              4,998
                  5,301                                     3,655      1,000

     9,000                                                                  800              652
                                                                            600
     6,000                                                                                                                                        390
                  8,809                 9,955               9,608           400
     3,000
                                                                            200                           94
        0                                                                     0
                  1H09                  2H09                 1H10                                  1H09                                    1H10
                                                                                                               Revenue   EBITDA
               Iron ore products   Raw coking coal   Raw steam coal

                                                                             * Includes intersegment sales
Mining: Vertical Integration                                                                                                                                         17




 ◦       High level of vertical integration into iron ore sustained and continues to mitigate effect of rising raw material
         prices

 ◦       Coking coal volumes decreased due to postponement of longwall repositioning at the Ulyanovskaya mine

 ◦       Third quarter volumes depressed due to temporary safety shutdowns and safety inspections



          Washed Coking Coal (Concentrate) Self-Coverage*                                                            Iron Ore Self-Coverage*
 ‘000 tonnes                                                                                  ‘000 tonnes

                                                   117%                                         12,000
6,000                                                                                                                                10,397                  10,580
                                                   5,288                                                                                      9,955                   9,608
                        117%
                                                                                                10,000        9,011 8,809
5,000                                      4,504                               84%
                       4,317                                          4,348
               3,679                               RASP                        3,642             8,000
4,000
                       RASP
3,000                                                                                            6,000
                                                                              RASP
2,000                                                                                            4,000

                                                   73%**                                         2,000
                                                                                                                     98%                      96%                     91%
1,000                  87%**                                                  50%**
     0                                                                                               0
                   1H09                        2H09                       1H10                                   1H09                      2H09                    1H10
                                 Consumption        Production                                                                  Consumption           Production

          * Self-coverage, %= total production (for coal, plus 40% of Raspadskaya production) divided by total steel segment consumption
          ** Coking coal self-coverage excl. 40% Raspadskaya share
Vanadium                                                                                                                               18



 ◦    Global leader with geographically diversified revenues via five operating units on four continents
 ◦    Vanadium is used predominantly in steelmaking and follows steel market trends
 ◦    Significant improvement in global demand for vanadium, although price growth is limited by supply pressure
      from China
 ◦    Acquisition of Vanady-Tula in 2009, Russia’s largest ferrovanadium producer, signals further expansion of
      vanadium-processing capacity
 ◦    Long-term demand for vanadium is expected to grow faster than for steel due to the tightened regulatory
      requirements for higher vanadium content in steel used by developing countries


                   Vanadium Products Sales Volumes *                                         Vanadium Products Revenues*
                                                                                                      by Region
‘000 tonnes of V                                                                 US$ mln
                                                                                                                    7
   12.0                                                                                                                     30
                                               10.7                       10.5                                34
   10.0

     8.0            7.4
                                                6.5
     6.0                                                                   9.1
                                                                                                         71
                    5.1
     4.0
                                                                                                                                  130
     2.0                                        4.2
                    2.3
                                                                           1.4
     0.0
                   1H09                        2H09                       1H10                    Russia & CIS     Europe          Americas
                                                                                                  Asia             Africa & RoW
                          Vanadium in slag   Vanadiun in alloys and chemicals
                                                                                   * External sales
Key Investment Project and CAPEX Guidance                                                               19



 ◦   1H 2010 CAPEX totalled US$397m
 ◦   FY2010 CAPEX is expected to be around US$950m vs. previous guidance of
     US$800m due to sustainable market improvement
 ◦   Increase of US$50m to US$450m in maintenance CAPEX designed to decrease
     down time and increase production volumes
 ◦   Acceleration of existing projects:
       ◦   US$40m for coking coal mining resource base development
       ◦   US$30m increase in the 2010 budget of pulverised coal injection (PCI) project at NTMK and
           ZSMK to speed up project implementation, for completion in 2012

 ◦   Introduction of new projects for a total of US$40m in 2010:
       ◦   Investment in new wheel shop expansion project at NTMK to improve wheel quality, on-
           stream by 2011
       ◦   Investment in product mix enhancement at NTMK’s H-beam mill to produce new high margin
           products by 2012
       ◦   Investment in expansion of Sheregeshsky and Kazsky iron ore mines to increase iron ore
           production, for completion in 2012-2013
       ◦   Purchase new railcars by EvrazTrans in order to raise cargo volumes carried by Evraz’s own
           rolling stock
Key Market Developments                                                                                                                     20



                                                               US$/t
                                                                                           Evraz Selling Prices
◦   Growth in steel prices is driven by demand recovery         900
    and increases in input costs                                800

◦   International prices for semi-finished steel declined in    700

    May-June due to seasonal and regulatory factors but         600

    stabilised in July and could recover further                500


◦   Russian domestic demand for construction steel is
                                                                400
                                                                300
    expected to be approx. 10% higher in 2010 than in
    2009                                                        200
                                                                      Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10
◦   Anticipated steelmaking capacity utilisation in 3Q10:                             Slabs, Russia, export*         Billets, Russia, export*

    ◦
                                                                                      Rebars, Russia, FCA            Plate, North America, FCA
        Russia – to remain >95%
                                                                       * Weighted average contract prices
    ◦   North America – >95%
    ◦   Czech Republic – temporarily closed since July
    ◦   South Africa – >95%                                                          Vanadium Prices, FeV, LMB
◦   Russian mining assets are running at 75% capacity in       US$/kg V
    coal and 85% in iron ore
                                                                40
◦   Vanadium expected to perform better than steel as           35
    vanadium usage rates in the emerging markets’ steel         30
    production sector approach the levels of industrially
                                                                25
    developed countries
                                                                20
                                                                15
                                                                      Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10
Outlook                                                                                      21



◦   High raw material prices and improving demand provides support for steel prices

◦   Russian construction market displaying positive dynamics

◦   Due to the lag between the spot prices and sales prices, market volatility during May-
    July 2010 will negatively affect 3Q10 results

◦   3Q 2010 EBITDA is expected to be in the range of US$480-550 million

◦   2010 CAPEX is expected to amount to some US$950 million vs. previous guidance of
    US$800 million, with the expanded CAPEX programme reflecting sustainable market
    improvement
Summary                                                                                    22



◦   1H 2010 saw a continuation of the gradual market recovery

◦   Rapidly rising raw material prices provide support for steel prices and create cost
    pressure, particularly in relation to scrap and externally purchased iron ore

◦   Increase in the proportion of finished products in the mix reflecting demand improvement
    in key markets of Russia and North America

◦   Strategic focus on operational efficiency, modernisation of existing capacities and
    integration of international assets

◦   Further refinancing of short-term debt supported by improved market conditions

◦   Improved demand and stronger pricing environment together with our cost leadership
    leave us well positioned to fully capitalise on the market recovery
Appendices
Revenue by Geography of Customers                                                                                   24




                        1H 2009                                                   1H 2010
                                Africa &                                                 Africa &
                                 RoW                                                      RoW
                    Other Asian
                                  3%                                       Other Asian     3%
                       7%
              Thailand                                                        11%
                3%                            Russia
       China                                   28%                 Thailand                               Russia
        5%                                                           4%                                    34%
                                                                  China
Middle East                                                        3%
   10%                                                       Middle East
                                                                 4%
                                                   Ukraine
                                                     2%
                                                                  Europe
                                                Other CIS          9%
      Europe                                                                                              Ukraine
                                                   3%
       9%                                                                                                   4%
                                                                                                    Other CIS
                                   Americas                                         Americas           4%
                                     30%                                              24%
Steel Products Sales by Market                                                                            25




  ’000 tonnes



   3,000                                                                   2,799

                        2,518
                                                                                   2,433
   2,500


                1,950
   2,000


   1,500                                                           1,307

                                                             948
   1,000
                                                    704
                                            577
                                      442
    500                         311                                                                310
                                                                                             238

       0
                 Russia           CIS       Europe           Americas         Asia         Africa & RoW

                                             1H09         1H10
Cost Structure by Segment                                                                                                 26



                                                                       Cost Structure of Steel Segment
                                                                       Cost Structure of Steel Segment
◦   Rapid rises in coking coal, iron ore and scrap prices
    caused an increase in the contribution of raw                          19%
                                                                                                             11%
                                                                                                              9%
    materials to steel segment costs                                        8%                               11%

◦   Vertically integrated model largely protects
                                                                           12%
                                                                           10%
                                                                                                              8%
                                                                                                              6%
                                                                                                              5%
    steelmaking segment from escalation in raw material                     5%
                                                                           10%
                                                                                                              6%
                                                                                                             14%
    prices                                                                  5%
                                                                           11%                               13%
◦   Exception is scrap prices, although portion of increase                 8%
                                                                           12%                               17%
    is managed through the scrap-based price formula for
    certain products                                                       1H09                              1H10
                                                              Iron ore              Coking coal               Scrap
                                                              Other raw materials   Semi-finished products    Transportation
                                                              Staff                 Depreciation              Energy
                                                              Other



               Cost Structure of Mining Segment
               Cost Structure of Mining Segment                          Cost Structure of Vanadium Segment
                                                                         Cost Structure of Vanadium Segment
                18%                           19%
                14%                           16%
                27%                           22%
                                                                           69%                               58%

                26%                           25%
                                                                                                             15%
                                              11%
                                                                            7%                               11%
                10%                                                        11%
                 5%                            7%                          13%                        1%     15%
               1H09                           1H10                         1H09                              1H10
             Raw materials   Transportation   Staff costs
                                                                   Transportation       Staff costs            Depreciation
             Depreciation    Energy           Other
                                                                   Energy               Other
Adjusted EBITDA                                                              27




                                                  Six months ended 30 June
(millions of US dollars)
                                                   2010             2009

Consolidated Adjusted EBITDA reconciliation
(Loss) profit from operations                       167            (1,046)
Add:
Depreciation, depletion and amortisation             861              782
Impairment of assets                                   38             211
Loss on disposal of property, plant & equipment        24               25
Foreign exchange (gain) loss                         (74)             (68)
Revaluation deficit                                  138              564
Consolidated Adjusted EBITDA                       1,154              468
+7 495 232-13-70
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Credit suisse global steel & mining conference, 22 23 сентября 2010

  • 1. Credit Suisse Global Steel & Mining Conference 22-23 September 2010
  • 2. Disclaimer 02 This document does not constitute or form part of and should not be construed as, an offer to sell or issue or the solicitation of an offer to buy or acquire securities of Evraz Group S.A. (Evraz) or any of its subsidiaries in any jurisdiction or an inducement to enter into investment activity. No part of this document, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. No representation, warranty or undertaking, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or the opinions contained herein. None of Evraz or any of its affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this document or its contents or otherwise arising in connection with the document. This communication is only being distributed to and is only directed at (i) persons who are outside the United Kingdom or (ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) or (iii) high net worth companies, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”). Any person who is not a relevant person should not act or rely on this document or any of its contents. 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 Evraz’s control that could cause the actual results, performance or achievements of Evraz to be materially different from future results, performance or achievements expressed or implied by such forward-looking, 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 our 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 Evraz’s present and future business strategies and the environment in which Evraz Group S.A. 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 Evraz 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’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based. Neither Evraz, 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. The information contained in this document is provided as at the date of this document and is subject to change without notice.
  • 4. Growth Strategy 04 Product mix improvements ◦ Modernisation of rail mills enabling the production of high value-added products ◦ Upgrade of wheel shops ◦ Shift to production of American Petroleum Institute certified slabs and other enhanced quality higher margin steel products ◦ Product mix expansion geared to local market demand (new rebar grades, beams, pipe blanks, sheet) ◦ Exploring opportunities for development of construction steel rolling capacities in regions with high demand Raw material base development ◦ Development of a coal deposit in Yerunakovsky region of Kuzbass ◦ Expansion of resource base and development of the Mezhegey coal deposit ◦ Increase of own iron ore production and supplementary exploration at existing sites Cost-saving measures ◦ Implementation of pulverised coal injection projects at the Russian steel mills to eliminate usage of natural gas in blast furnaces and reduce consumption of coking coal. Added effect will be an increase in pig iron production volumes and, therefore, crude steel production ◦ Cost saving programmes in place, yielding US$20-30m efficiency gains a year at each plant Increase in production volumes ◦ Reconstruction of 4th converter and 3rd slab machine at NTMK should increase crude steel output by up to 0.5 mtpa ◦ Considering construction of a second converter shop at NTMK with additional crude steel capacity of 1.5-2.0 mtpa
  • 5. 1H 2010 Financial Summary 05 US$ mln unless otherwise stated 1H 2010 1H 2009 Change Revenue 6,379 4,639 38% Cost of revenue (5,296) (4,297) 23% SG&A (750) (595) 26% Adjusted EBITDA* 1,154 468 147% Adjusted EBITDA margin 18% 10% Net Profit/(Loss)** (270) (999) EPS (US$ per GDR) (0.64) (2.52) Net Debt*** 7,198 7,783 (9)% Short-term Debt*** 1,740 3,937 (56)% Steel sales volumes**** (’000 tonnes) 7,714 6,823 13% * Adjusted EBITDA represents profit from operations plus depreciation and amortisation, impairment of assets, revaluation deficit, foreign exchange loss (gain) and loss (gain) on disposal of PP&E. See the appendix on p.29 for reconciliation of profit (loss) from operations to Adjusted EBITDA ** If cost model of accounting for PP&E were applied, net result would have been a profit of approximately US$146 million for the 1H 2010 *** As of the end of the reporting period **** Here and throughout this presentation segment sales data refers to external sales unless otherwise stated
  • 6. 1H 2010 Financial Highlights 06 Consolidated Revenue by Segment ◦ Group revenue rose by 38%, largely driven by increase in sales volumes of steel products and higher average US$ mln 6,379 7,500 414 prices 290 4,639 1,120 ◦ Group EBITDA advanced by 147% reflecting revenue 6,000 4,500 343 138 652 expansion and cost control ◦ 3,000 5,796 Mining segment EBITDA more than quadrupled, largely 4,291 1,500 due to the growth in iron ore and coal prices ◦ 0 (785) EBITDA margin improved from 10% in 1H09 to 18% in (1,241) -1,500 1H10 1H09 1H10 Steel Mining Vanadium Other operations Eliminations Revenue Drivers Consolidated Adjusted EBITDA US$ mln US$ mln 7,000 1,121 6,379 1,400 1,154 6,000 619 85 1,200 81 5,000 4,369 1,000 390 4,000 800 468 3,000 600 70 2,000 400 94 738 1,000 200 389 0 0 (34) (51) (140) 1H09 Revenue Volumes Prices 1H10 Revenue -200 1H09 1H10 Steel Mining Vanadium Other operations Unallocated subsidiaries & eliminations
  • 7. Cost Dynamics 07 ◦ Growth in scrap, coking coal and iron ore prices in 1H Cash Cost*, Slabs & Billets 2010 increased steelmakers’ costs US$/t ◦ This cost increase was significantly offset by Evraz’s 450 400 402 430 high level of vertical integration into iron ore and coking 394 420 341 350 coal 285 300 ◦ Consolidated cost, approx. 65% of which is Rouble 250 253 324 denominated, was negatively impacted by 10% Rouble 200 224 268 appreciation vs. US dollar compared to 1H09 150 ◦ Increase in cash cost of coking coal concentrate 1H08 2H08 1H09 2H09 1H10 resulted from lower production volumes due to Slab Billet postponed longwall repositioning at the Ulyanovskaya mine * Average for Russian steel mills, integrated cash cost of production, EXW Consolidated Cost of Revenue, 1H 2010 Cash Cost, Russian Coking Coal and 7% Iron Ore Products 13% US$/t 10% 75 15% 69 63 12% 65 56 55 55 61 6% 5% 47 5% 43 11% 45 50 7% 47 4% 5% 43 35 Iron ore Coking coal Scrap 1H08 2H08 1H09 2H09 1H10 Ferroalloys Purchased semis Auxilliary materials Electricity Natural gas Staff costs Coal concentrate Iron ore products, 58% Fe Transportation Depreciation Other Source: Management accounts
  • 8. EBITDA to FCF Reconciliation 08 US$ mln 1600 1,154 (51) 1200 1,103 (258) (101) 744 (308) 800 (397) 400 12 51 0 Adjusted Non-cash EBITDA Changes in Income tax CF from Interest and Capex CF from Free cash EBITDA items (excl. non- working paid operating covenant investing flow* cash items) capital activities reset activities (excl. payments (excl. income tax) capex) * Free cash flow comprises cash flows from operating activities less interest paid, covenant reset charges, cash flows from investing activities
  • 9. Developments: Capital Markets 09 ◦ RUB15bn (equivalent to US$500 million) 3-year bonds issued in March 2010, swapped into US dollars to minimise Rouble currency exposure ◦ In May 2010, Evraz drew down US$950 million 5-year Gazprombank loan and repaid US$1,007million VEB loan ◦ In June-July 2010, Evraz refinanced US$357 million Nordea Bank loan due 4Q10 with new 4-year Nordea loan facilities in the amount US$404 million Proportion of Short-term Debt to Total Debt Proportion of Short-term Debt to Total Debt US$ mln 10,000 100% 8,482 7,923 7,873 8,000 80% 6,000 46% 60% 4,000 25% 40% 22% 2,000 20% 0 0% 30-Jun-09 31-Dec-09 30-Jun-10 Total Debt Short-term Debt, % of Total Debt
  • 10. Balanced Debt Maturity Profile 10 ◦ Total debt of approx. US$7.9bn, net debt of US$7.2bn as of 30 June 2010 ◦ Consolidated cash balance of not less than US$500 million constantly maintained ◦ Liquidity (defined as cash and cash equivalents, amounts available under credit facilities and short-term bank deposits with original maturity of <3 months) totalled approx. US$1,598 million as of 30 June 2010 ◦ Declining cost of capital (bond yields have decreased from approx. 10% in October 2009 to around 6%) reflects improvements in Evraz’s performance and market conditions and permits further refinancing of short-term debt ◦ We intend to further decrease our leverage and extend debt maturities Debt Maturities Schedule (as of 30 June 2010) Debt Maturities Schedule (as of 30 June 2010) Breakdown of Short-term Debt* Breakdown of Short-term Debt* (as at 30 June 2010) (as at 30 June 2010) US$ mln US$ mln 2,000 1,778 1,600 1,543 1,419 593 786 1,200 1,085 996 800 721 509 400 15 11 279 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 Syndicated loans Overdrafts Russian bilateral loans Q1 Q2 Q3 Q4 * Principal debt (excl. interest accrued)
  • 11. Steel: Geographic and Product Mix Change 11 ◦ Recovery in demand for construction and railway products in Russian market raised the proportion of finished products in the portfolio ◦ Share of construction products increased from 25% to 32% ◦ Share of semi-finished products fell from 40% to 29% ◦ Share of Group’s sales volumes in the Russian market increased from 29% to 33% following recovery in domestic demand ◦ Domestic sales of Russian and Ukrainian operations advanced from 44% to 53% Steel Product Sales Volumes by Operations Steel Product Sales Volumes by Operations Steel Sales Volumes by Product Steel Sales Volumes by Product ’000 tonnes ’000 tonnes 6,000 5,532 5,187 3,000 2,704 5,000 2,470 2,500 2,262 export 4,000 1,834 2,000 47% 3,000 56% 1,500 1,304 974 887 2,000 1,000 821 1,276 53% 944 391 436 1,000 44% 603 500 413 279 303 186268 domestic 0 0 Russian & North American European South African Semi- Construction Railway Flat-rolled Tubular Other steel Ukrainian finished 1H09 1H10 1H09 1H10
  • 12. Steel: CIS Domestic 12 ◦ Real demand for finished steel increased from approx. 70% of pre-crisis peak level to approx. 80% with significant fluctuations in apparent demand due to destocking/restocking cycles ◦ Sales volumes of steel products to CIS market expanded by 31% ◦ Sales volumes of construction steel and railway products rose 38% and 31% respectively ◦ Prices of key products strengthened in response to demand recovery and growth in raw material prices and remain close to export parity level ◦ Government infrastructure spending is currently supporting demand for construction and infrastructure steel, as well as railway products, in the Russian market Steel Product Sales Volumes Steel Product Revenues ‘000 tonnes US$ mln 2,000 1,885 3,500 1,800 213 2,954 3,000 1,600 338 527 1,400 2,500 2,262 1,200 1,106 242 767 2,000 1,000 116 586 1,500 800 346 600 996 1,000 1,565 1,137 400 527 500 200 297 284 117 149 0 0 1H09 1H10 1H09 1H10 Semi-finished Construction Railway Other steel Semi-finished Construction Railway Other steel
  • 13. Steel: CIS Export 13 ◦ Strong underlying demand from developing countries ◦ Some correction in prices due to supply pressure of Chinese steel in Asian markets associated with cancellation of export rebates in China ◦ Export sales of steel products declined by 12% in volume terms reflecting the switch of volumes towards the CIS market and higher volumes of slab re-rolling within the Group (+0.4 million tonnes) ◦ Increase in production of slabs vs. billets to take advantage of more favourable pricing environment ◦ Delayed effect of rising steel prices due to the fact that export prices are typically fixed one to three months ahead of production Steel Product Sales Volumes Steel Product Revenues US$ mln ‘000 tonnes 1,290 1,400 48 4,000 1,200 1,099 106 279 2.925 2,578 1,000 3,000 233 225 67 800 566 526 535 2,000 600 542 1,577 1,080 400 1,000 200 437 896 218 557 0 0 1H09 1H10 1H09 1H10 Slabs Billets Construction Other steel Slabs Billets Construction Other steel
  • 14. Steel: North America 14 ◦ Gradual recovery in demand driven by economic improvements and the onset of regional governments’ infrastructure spending ◦ Shale gas exploration projects generate strong demand for small diameter pipe ◦ Sales volumes of steel products increased by 35% ◦ Flat-rolled steel volumes increased by 56%; construction steel by 5 times ◦ Pricing of steel products generally follows scrap price trends Steel Product Sales Volumes Steel Product Revenues ‘000 tonnes US$ mln 1,327 1400 1,142 1,400 1,276 1200 1,200 1000 601 944 436 1,000 800 630 800 384 600 600 468 408 400 262 400 297 181 200 172 200 226 224 191 146 0 37 0 26 1H09 1H10 1H09 1H10 Construction Railway Flat-rolled Tubular Construction Railway Flat-rolled Tubular
  • 15. Steel: Europe, South Africa 15 ◦ Domestic demand in Europe remains weak and mostly related to public projects ◦ Temporary shutdown of steelmaking in the Czech Republic: ◦ Evraz Vitkovice Steel temporarily closed its steelmaking operations from July 2010 due to the price dispute with the supplier of liquid pig iron ◦ Rolling capacities in the Czech Republic are operating at the same rate ◦ The shutdown had no material economic impact on Evraz’s production volumes and costs ◦ Domestic demand in South African market remains weak, with approx. 25% of South African steel volumes exported Steel Product Sales Volumes, Steel Product Sales Volumes, European Operations South African Operations ‘000 tonnes ‘000 tonnes 700 603 600 10 400 500 413 303 279 400 10 300 8 511 4 300 106 200 196 200 361 51 100 100 82 118 97 0 42 - 2 1H09 1H10 1H09 1H10 Construction Flat-rolled Other steel Semi-finished Construction Flat-rolled Other steel
  • 16. Benefiting from Rising Prices for Iron Ore and Coal 16 Raw Material Prices (Domestic Markets) Raw Material Prices (Domestic Markets) ◦ Volumes of coking coal mined decreased due the US$/t 400 repositioning of longwall at Ulyanovskaya mine ◦ Mining segment revenue doubled and EBITDA 300 quadrupled reflecting the growth in prices 200 ◦ A decline in coking coal supplies, following the 100 Raspadskaya mine explosion, led to lower external sales of coke and a negative EBITDA effect of approx. 0 US$5 million per month Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Scrap, Russia, CPT Scrap, USA Iron ore concentrate, Russia, ExW Coking coal concentrate, Russia, FCA Iron Ore and Raw Coal Production Mining Segment Revenue* and EBITDA ‘000 tonnes US$ mln 18,000 2,015 15,000 2,131 2,351 1,120 1,200 12,000 4,998 5,301 3,655 1,000 9,000 800 652 600 6,000 390 8,809 9,955 9,608 400 3,000 200 94 0 0 1H09 2H09 1H10 1H09 1H10 Revenue EBITDA Iron ore products Raw coking coal Raw steam coal * Includes intersegment sales
  • 17. Mining: Vertical Integration 17 ◦ High level of vertical integration into iron ore sustained and continues to mitigate effect of rising raw material prices ◦ Coking coal volumes decreased due to postponement of longwall repositioning at the Ulyanovskaya mine ◦ Third quarter volumes depressed due to temporary safety shutdowns and safety inspections Washed Coking Coal (Concentrate) Self-Coverage* Iron Ore Self-Coverage* ‘000 tonnes ‘000 tonnes 117% 12,000 6,000 10,397 10,580 5,288 9,955 9,608 117% 10,000 9,011 8,809 5,000 4,504 84% 4,317 4,348 3,679 RASP 3,642 8,000 4,000 RASP 3,000 6,000 RASP 2,000 4,000 73%** 2,000 98% 96% 91% 1,000 87%** 50%** 0 0 1H09 2H09 1H10 1H09 2H09 1H10 Consumption Production Consumption Production * Self-coverage, %= total production (for coal, plus 40% of Raspadskaya production) divided by total steel segment consumption ** Coking coal self-coverage excl. 40% Raspadskaya share
  • 18. Vanadium 18 ◦ Global leader with geographically diversified revenues via five operating units on four continents ◦ Vanadium is used predominantly in steelmaking and follows steel market trends ◦ Significant improvement in global demand for vanadium, although price growth is limited by supply pressure from China ◦ Acquisition of Vanady-Tula in 2009, Russia’s largest ferrovanadium producer, signals further expansion of vanadium-processing capacity ◦ Long-term demand for vanadium is expected to grow faster than for steel due to the tightened regulatory requirements for higher vanadium content in steel used by developing countries Vanadium Products Sales Volumes * Vanadium Products Revenues* by Region ‘000 tonnes of V US$ mln 7 12.0 30 10.7 10.5 34 10.0 8.0 7.4 6.5 6.0 9.1 71 5.1 4.0 130 2.0 4.2 2.3 1.4 0.0 1H09 2H09 1H10 Russia & CIS Europe Americas Asia Africa & RoW Vanadium in slag Vanadiun in alloys and chemicals * External sales
  • 19. Key Investment Project and CAPEX Guidance 19 ◦ 1H 2010 CAPEX totalled US$397m ◦ FY2010 CAPEX is expected to be around US$950m vs. previous guidance of US$800m due to sustainable market improvement ◦ Increase of US$50m to US$450m in maintenance CAPEX designed to decrease down time and increase production volumes ◦ Acceleration of existing projects: ◦ US$40m for coking coal mining resource base development ◦ US$30m increase in the 2010 budget of pulverised coal injection (PCI) project at NTMK and ZSMK to speed up project implementation, for completion in 2012 ◦ Introduction of new projects for a total of US$40m in 2010: ◦ Investment in new wheel shop expansion project at NTMK to improve wheel quality, on- stream by 2011 ◦ Investment in product mix enhancement at NTMK’s H-beam mill to produce new high margin products by 2012 ◦ Investment in expansion of Sheregeshsky and Kazsky iron ore mines to increase iron ore production, for completion in 2012-2013 ◦ Purchase new railcars by EvrazTrans in order to raise cargo volumes carried by Evraz’s own rolling stock
  • 20. Key Market Developments 20 US$/t Evraz Selling Prices ◦ Growth in steel prices is driven by demand recovery 900 and increases in input costs 800 ◦ International prices for semi-finished steel declined in 700 May-June due to seasonal and regulatory factors but 600 stabilised in July and could recover further 500 ◦ Russian domestic demand for construction steel is 400 300 expected to be approx. 10% higher in 2010 than in 2009 200 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10 ◦ Anticipated steelmaking capacity utilisation in 3Q10: Slabs, Russia, export* Billets, Russia, export* ◦ Rebars, Russia, FCA Plate, North America, FCA Russia – to remain >95% * Weighted average contract prices ◦ North America – >95% ◦ Czech Republic – temporarily closed since July ◦ South Africa – >95% Vanadium Prices, FeV, LMB ◦ Russian mining assets are running at 75% capacity in US$/kg V coal and 85% in iron ore 40 ◦ Vanadium expected to perform better than steel as 35 vanadium usage rates in the emerging markets’ steel 30 production sector approach the levels of industrially 25 developed countries 20 15 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10
  • 21. Outlook 21 ◦ High raw material prices and improving demand provides support for steel prices ◦ Russian construction market displaying positive dynamics ◦ Due to the lag between the spot prices and sales prices, market volatility during May- July 2010 will negatively affect 3Q10 results ◦ 3Q 2010 EBITDA is expected to be in the range of US$480-550 million ◦ 2010 CAPEX is expected to amount to some US$950 million vs. previous guidance of US$800 million, with the expanded CAPEX programme reflecting sustainable market improvement
  • 22. Summary 22 ◦ 1H 2010 saw a continuation of the gradual market recovery ◦ Rapidly rising raw material prices provide support for steel prices and create cost pressure, particularly in relation to scrap and externally purchased iron ore ◦ Increase in the proportion of finished products in the mix reflecting demand improvement in key markets of Russia and North America ◦ Strategic focus on operational efficiency, modernisation of existing capacities and integration of international assets ◦ Further refinancing of short-term debt supported by improved market conditions ◦ Improved demand and stronger pricing environment together with our cost leadership leave us well positioned to fully capitalise on the market recovery
  • 24. Revenue by Geography of Customers 24 1H 2009 1H 2010 Africa & Africa & RoW RoW Other Asian 3% Other Asian 3% 7% Thailand 11% 3% Russia China 28% Thailand Russia 5% 4% 34% China Middle East 3% 10% Middle East 4% Ukraine 2% Europe Other CIS 9% Europe Ukraine 3% 9% 4% Other CIS Americas Americas 4% 30% 24%
  • 25. Steel Products Sales by Market 25 ’000 tonnes 3,000 2,799 2,518 2,433 2,500 1,950 2,000 1,500 1,307 948 1,000 704 577 442 500 311 310 238 0 Russia CIS Europe Americas Asia Africa & RoW 1H09 1H10
  • 26. Cost Structure by Segment 26 Cost Structure of Steel Segment Cost Structure of Steel Segment ◦ Rapid rises in coking coal, iron ore and scrap prices caused an increase in the contribution of raw 19% 11% 9% materials to steel segment costs 8% 11% ◦ Vertically integrated model largely protects 12% 10% 8% 6% 5% steelmaking segment from escalation in raw material 5% 10% 6% 14% prices 5% 11% 13% ◦ Exception is scrap prices, although portion of increase 8% 12% 17% is managed through the scrap-based price formula for certain products 1H09 1H10 Iron ore Coking coal Scrap Other raw materials Semi-finished products Transportation Staff Depreciation Energy Other Cost Structure of Mining Segment Cost Structure of Mining Segment Cost Structure of Vanadium Segment Cost Structure of Vanadium Segment 18% 19% 14% 16% 27% 22% 69% 58% 26% 25% 15% 11% 7% 11% 10% 11% 5% 7% 13% 1% 15% 1H09 1H10 1H09 1H10 Raw materials Transportation Staff costs Transportation Staff costs Depreciation Depreciation Energy Other Energy Other
  • 27. Adjusted EBITDA 27 Six months ended 30 June (millions of US dollars) 2010 2009 Consolidated Adjusted EBITDA reconciliation (Loss) profit from operations 167 (1,046) Add: Depreciation, depletion and amortisation 861 782 Impairment of assets 38 211 Loss on disposal of property, plant & equipment 24 25 Foreign exchange (gain) loss (74) (68) Revaluation deficit 138 564 Consolidated Adjusted EBITDA 1,154 468
  • 28. +7 495 232-13-70 IR@evraz.com www.evraz.com