NLMK Q3 2012 Financials

1. NLMK
Q3 AND 9M 2012
US GAAP CONSOLIDATED RESULTS
OLEG BAGRIN, CHIEF EXECUTIVE OFFICER AND
CHAIRMAN OF MANAGEMENT BOARD
GALINA AGLYAMOVA, CHIEF FINANCIAL OFFICER
Moscow, 2012

2. DISCLAIMER
This document is confidential and has been prepared by NLMK (the “Company”) solely for use at the investor presentation of the Company and may not be
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or subscribe for, any shares in the Company or Global Depositary Shares (GDSs), nor shall it or any part of it nor the fact of its presentation or distribution form the
basis of, or be relied on in connection with, any contract or investment decision.
No reliance may be placed for any purpose whatsoever on the information contained in this document or on assumptions made as to its completeness. No
representation or warranty, express or implied, is given by the Company, its subsidiaries or any of their respective advisers, officers, employees or agents, as to the
accuracy of the information or opinions or for any loss howsoever arising, directly or indirectly, from any use of this presentation or its contents.
This document is for distribution only in the United Kingdom and the presentation is being made only in the United Kingdom to persons having professional
experience in matters relating to investments falling within Article 19(1) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the
“Order”) or high net worth entities, and other persons to whom it may otherwise lawfully be communicated, falling within Article 49(2) of the Order (all such
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This document may include forward-looking statements. These forward-looking statements include matters that are not historical facts or statements regarding
the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of operations, financial condition, liquidity,
prospects, growth, strategies, and the industry in which the Company operates. By their nature, forwarding-looking statements involve risks and uncertainties
because they relate to events and depend on circumstances that may or may not occur in the future. The Company cautions you that forward-looking statements
are not guarantees of future performance and that the Company’s actual results of operations, financial condition and liquidity and the development of the
industry in which the Company operates may differ materially from those made in or suggested by the forward-looking statements contained in this document. In
addition, even if the Company’s results of operations, financial condition and liquidity and the development of the industry in which the Company operates are
consistent with the forward-looking statements contained in this document, those results or developments may not be indicative of results or developments in
future periods. The Company does not undertake any obligation to review or confirm analysts’ expectations or estimates or to update any forward-looking
statements to reflect events that occur or circumstances that arise after the date of this presentation.
By attending this presentation you agree to be bound by the foregoing terms.
2

3. INTERNATIONAL MARKETS
DEMAND STEELMAKING CAPACITIES UTILISTION
100%
• Weaker demand on major markets
80%
• Global run rates declined
PRICES 60%
• Raw materials prices under pressure from lower steel 40%
capacity utilization 20%
• Steel prices continued to decline across all regions 0%
Jan-08
Mar-08
May-08
Jul-08
Sep-08
Nov-08
Jan-09
Mar-09
May-09
Jul-09
Sep-09
Nov-09
Jan-10
Mar-10
May-10
Jul-10
Sep-10
Nov-10
Jan-11
Mar-11
May-11
Jul-11
Sep-11
Nov-11
Jan-12
Mar-12
May-12
Jul-12
Sep-12
with Russia being less impacted
INVENTORIES China North America Europe
• Steel stock remain low in developed economies Source: World Steel Association
• Sizable decline in Chinese inventories
STEEL INVENTORIES FLAT STEEL PRICES BY REGION
Index, January 2011 = 1
$1,100 $/ metric tonne Quarterly dynamics
1.2
adjusted for
1.1 $900 production/ sales cycle
1 $700
0.9
$500
0.8 Inventories Germany HRC, CIS export, FOB
Inventories China $300 HRC U.S. domestic prices, FOB
0.7
Inventories U.S. HRC, Europe domestic prices, EXW
0.6 $100
Jan-11
Mar-11
May-11
Jul-11
Sep-11
Nov-11
Jan-12
Mar-12
May-12
Jul-12
Sep-12
Jan-11
Mar-11
May-11
Jul-11
Sep-11
Nov-11
Jan-12
Mar-12
May-12
Jul-12
Sep-12
Sources: CRU, Bloomberg (China statistic, Metals Service Center Inst.) Source: Steel Business Briefing 3

4. RUSSIAN MARKET
DEMAND CRUDE STEEL PRODUCTION, STEEL USE AND PRICES
• Stable on the back of economic growth. Apparent steel million t/month $/t 1,100
6.0 1,000
use increased by 5% in Q3 900
5.0
• Consumption by construction industry surpassed the peak 800
700
of 2008 4.0
600
500
PRICES 3.0
400
• Flat steel prices for ordinary grades declined in line with 2.0 ASU
+ 5%, q/q
300
200
global trends, value added remained stable 1.0 100
Jan-11
Feb-11
Mar-11
Apr-11
May-11
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
Dec-11
Jan-12
Feb-12
Mar-12
Apr-12
May-12
Jun-12
Jul-12
Aug-12
Sep-12
• The demand for long steel improved on the back of the
increased activity in the construction sector
Crude steel production Apparent steel use
NLMK POSITION ON THE DOMESTIC MARKET HRC price (r.h.) Rebar price (r.h.)
• Company’s share in steel production achieved 20% Sources: Metal-Expert, Metal Bulletin
• Leading positions in industries with sustainable demand
STEEL DEMAND IN CONSTRUCTION NLMK POSITIONS IN RUSSIAN MARKET
2.5 million t/
month 100%
2.0 peak level of 2008
~70%
39%
1.5 29%
20% 24% 19% ~20%
1.0 17%
0.5
Crude steel
HRC
CRC
Galvanised
Pre-painted
Transformer
Dynamo
Rebar
Metallware
production
0.0
Jan-08
Jan-09
Jan-10
Jan-11
Jan-12
May-10
May-08
May-09
May-11
May-12
Sep-09
Sep-08
Sep-10
Sep-11
Sep-12
Production data for 9M 2012
Sources: Rosstat, Company’s data Sources: Chermet, Metal-Expert, Company’s data
4

5. PRODUCTION
STABLE OUTPUT IN Q3 2012 CRUDE STEEL PRODUCTION, QUARTERLY
• Novolipetsk (Steel segment) 3.076 m t 4.5 million t
3,6
3,8 3,8 ~3,7
4.0
(-2% q-o-q) 3.5 3,2
3.0
• NLMK Long Steel 0.479 m t
2.5
(+3% q-o-q) 2.0
1.5
• Foreign rolled products segment 0.216 m t 1.0
(-13% q-o-q) 0.5
0.0
Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012F
CAPACITY UTILIZATION 96% Steel segment Long products segment Foreign rolled products segment
• Novolipetsk (Steel segment) 100% (+1 p.p.)
• NLMK Long Steel 86% (+1 p.p.)
• Foreign rolled products segment 91% (-3 p.p.)
CAPACITY UTILIZATION
OUTLOOK Novolipetsk
100%
99%
• Q4 ’12: 3.7 m t (-2 % q-o-q)
• 2012: 15 m t (+25% y-o-y) NLMK Long 86%
Steel 85%
91%
NLMK USA
94%
0% 20% 40% 60% 80% 100% 120%
Q3 2012 Q2 2012
5

6. SALES GEOGRAPHY
HIGHER SALES TO RUSSIAN MARKET REVENUE BY REGION
$ million
• +4% q-o-q beating absolute record level 3,257 3,002
3,053 3,094
300
(-7.8% q/q)
$3,000
GROWTH OF INTERNATIONAL SALES 353 289
332 340
359
527 494 448
• Lower demand from European and USA markets $2,000 364
458
191 -7% q/q 400
269
273 201
offset by increased supplies to S.E. Asia and other 698
740
523
634
$1,000
LOWER SLAB SUPPLIES TO OWN ROLLING ASSETS 1,199 -9% q/q 1,091
902 1,021
• About 0.5 m t delivered in Q3 (-33% q/q) and 2 m t $0
Q4 2011 Q1 2012 Q2 2012 Q3 2012
in 9M 2012 Russia EU
Middle East (incl. Turkey) North America
Asia Other regions
SLABS SUPPLIES TO OWN ROLLING ASSETS SALES BY REGION
1000 million t 60% million t
5.0
50% 3,872 3,816
800 3,552 3,818
4.0
107 40% 0.30 0.37 0.43
107 0.26
600 0.63 0.55
3.0 0.83 0.73
30% 0.63 0.61 -2% q/q
108 0.49
400 2.0 0.50 0.38 0.33 0.27
606 645 20% 0.34
0.83 0.75 0.64
454 0.56
200 395 10% 1.0
1.10 1.20 +4% q/q 1.26
1.06
0 0% 0.0
Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2011 Q1 2012 Q2 2012 Q3 2012
NLMK Europe NLMK USA Share of total slabs sales
Other regions Asia North America Middle East (incl. Turkey) EU Russia
6

7. SALES STRUCTURE
CHANGE IN SALES MIX SALES AND REVENUE BY PRODUCT
100% Revenue from other
• Growth in slabs sales to 3rd parties 5% 9% operations*
Pig iron
2%
• … as European subsidiaries decreased utilization rates 80% 26% 15% Slabs
Ordinary HRC
due to seasonality and overall demand weakness products
60% 22% Long products
• Thick plates lower q-o-q due to upgrade of rolling 24%
Metallware
8%
operations at NLMK DanSteel 40% 10% 2% Thick plates
9%
2%
5% CRC
VALUE ADDED STEEL SALES AT 35% OF TOTAL Value 13%
20% 14% added Galvanised
• Strong domestic demand supported value added sales 7%
products 9%
Pre-painted
4% 2% 6%
0% 2% 4%2% Dynamo
Sales Revenue Transformer
*Note: Revenue from other operations include revenues from sales of iron ore, coke, scrap
and others
STEEL PRODUCTS SALES CHANGE IN SALES STRUCTURE Q3/Q2
4 million t
Slabs 14%
1.11 1.00 1.18 Metallware 2%
3 1.15
Pre-painted 2%
0.39 0.47
0.44 CRC
0.33 0%
2
Transformer -5%
1.34 1.37
1.26 1.27 HRC -6%
1 Long products -7%
0.82 1.03 0.97 0.91 Galvanised -13%
0 Dynamo -13%
Q4 2011 Q1 2012 Q2 2012 Q3 2012 Thick plates* -20%
Semi-finished Longs Flats value added Flats -30% -20% -10% 0% 10% 20%
*Lower thick plates sales partially relates to the launch of new mill at NLMK DanSteel 7

8. STRATEGIC DEVELOPMENTS
GROWTH IN CRUDE STEEL CAPACITY CAPEX
• Blast Furnace #7 / BOF 3.4 m tpa project 100%
$ million
2500
completed. Utilisation rates of the new capacities 80% 2000
are at maximum 76%
77%
60% 81% 82% 1500
• Improved steel quality, +30 new steel grades 87%
40% 1000
• Kaluga mini mill (1.5 m tpa of long steel) to be
20% 500
operation in 2013 24% 19% 13% 18% 23%
0% 0
FINISHED PRODUCTS OUTPUT GROWTH 2008 2009 2010 2011 2012E
• Growth in rolling capacity for value added products Maintenance capex Development Total investments
• Improved quality of the existing (incl niche) products
(NLMK DanSteel rolling mill upgrade)
VERTICAL INTEGRATION
• Iron ore capacity growth with continued expansion CAPEX BY SEGMENTS, 2012E
of Stoilensky Steel segment
• Coke-chemical projects (PCI, tar pitch, etc.) to 13%
Long products
reduce energy costs segment
• Expansion of scrap capacity 22% 48%
Mining segment
IMPROVED EFFICIENCY
• Growth of self-sufficiency and efficient use of energy Foreign rolled
products segment
16%
8

9. HIGHLIGHTS
Q3 ‘12 FINANCIAL RESULTS REVENUE AND EBITDA MARGIN
$3.4 $ billion 18% 20%
• Revenue $3,002 m (-8% q-o-q), 18%
$3.2 14% 16%
12% 16%
• EBITDA $483 m (-19%), $3.0 14%
12%
• EBITDA margin 16.1% (-2.2 p.p.), $2.8
10%
$2.6 3.26
3.09 8%
• Net profit: $167 million (-40%), $2.4
3.05 3.00
6%
4%
• EPS $0,03, $2.2
2%
$2.0 0%
• Operating cash flow: $684 m (+125%), Q4 2011 Q1 2012 Q2 2012 Q3 2012
• CAPEX: $347 m (-23%), Revenue EBITDA margin (r.h.)
• Net debt/EBITDA: 1.84
Q3 ‘12 OPERATING RESULTS EPS
• Steel output: 3.772 m t (-2%), $0.05 $/share 10%
8.5%
• Steel sales: 3.816 m t (0%), $0.04 8%
5.6%
• Revenue/t: $787 (-8%), $0.03 5.0% 5.6% 6%
0.05
• Slab cash cost at Lipetsk plant : $383 (-7%). $0.02 4%
0.03 0.03 0.03
$0.01 2%
$0.00 0%
Q4 2011 Q1 2012 Q2 2012 Q3 2012
Net income per share Net income margin (r.h.)
9

10. PRODUCTION COSTS
PRODUCTION COSTS DOWN BY 5% COST OF GOODS SOLD
$ million
• Impacted by lower prices for raw materials $2,500 2,210 2,205
2,163 2,095 Prod.
• Strict control over operating expenses and overheads $2,000
expenses
-5% q/q
• Lower consumption of pellets supplied by 3rd parties $1,500
• Slab cash cost decreased by 7% to $383/t. Depreciation
$1,000 +29% q/q
DEPRECIATION $500
129 177 171 221
• Growth by 29% following growth in PPE $0
Q4 2011 Q1 2012 Q2 2012 Q3 2012
Production expenses Depreciation
CASH COST FOR BOF STEEL GLOBALLY CONSOLIDATED PRODUCTION COSTS Q3 2012
$650 $/t Iron ore 11%
$600 11%
12% Coal / coke 18%
$550
Scrap 15%
$500
13%
$450 18% Ferroalloys 4%
$400 Materials
Novolipetsk 0.8% 16%
$350 4%
Electric energy 7%
$300 7%
$250 15% Natural gas 4%
$200 16% 4% Other energy 0.8%
106
113
120
127
134
141
8
1
43
15
22
29
36
50
57
64
71
78
85
92
99
100 mtpa 260 mtpa 500 mtpa 550 mtpa Other costs 13%
Cumulative BOF capacities Labor 12%
Source: World Steel Dynamics. Data as of the end of 9M 2012 10

11. PROFITABILITY
EBITDA DYNAMICS EBITDA CHANGE BY SEGMENT
• In Q3 overall EBITDA declined mainly due to $ million
600
weakening market environment -32 +11
+22
500
• A decline in steel prices outpaces the decline for raw -57
-57
materials negatively contributing to the company’s 400 596
483
profitability 300
KEY FACTORS BEHIND EBITDA CHANGE
200
•
Steel segment
Q2 2012
Long products
segment
Q3 2012
Foreign rolled
incl intersegmental
Lower steel prices and change in the product mix was
Mining
Other operations
products
segment
segment
partially compensated by the reduced production
costs
EBITDA: FACTOR ANALYSIS EBITDA MARGIN
20%
700 $ million
18%
600 15% 16%
-46 +81 14%
500 12%
10%
-8
400 596 -140
483 5%
300
200 0%
Others
Volumes and
Q2 2012
Prices
Production
Q3 2012
Q4 2011 Q1 2012 Q2 2012 Q3 2012
product mix
costs
11

12. CASH FLOW
SIGNIFICANT CASH GROWTH Q3’12 CASH BRIDGE
• Over $1bn of cash inflow in Q3 $ million
CHANGE IN CASH 1 034
OPERATING CASH FLOW INCREASED
• $684 of cash from operation activities including FX rate change -21
o $483 m EBITDA and
o $273 m from working capital changes Dividends -2
GROWTH IN CASH FROM FINANCIAL ACTIVITIES FREE CASH FLOW TO THE
FIRM 1 057
• RUB bond (approximately US$320 million) and Euro
Other financial operations
bond (US$500 million) placements. +4
DECREASE IN CAPEX Net loans +716
• -23% q-o-q to US$347 million
Purchase of property plant
-347
Q3 2012 CASH INFLOW AS A RESULT OF WORKING and equipment
CAPITAL MOVEMENTS
684
$ million OPERATING CASH FLOW
300
250 -11 -63
24 Profit tax
79
200
150 Other non cash operations -9
273
100 181
Working capital change 273
50
0
Decline in Decline in Increase in Other factors Q3 2012 EBITDA 483
Accounts Inventories Accounts
receivable payable
Cash flow statement data 12

13. DEBT
DEBT POSITION CHANGE IN DEBT POSITION
• Net debt $3.47 billion (-3%) $6 $ billion +0,9
+0,4
$5
• Net debt / 12M EBITDA 1.84 (down from 1.9) -0,2
$4 2.4
• Cash and equivalents1 $1.814 billion (+133%)
2.0
$3
• Gross debt $5.28 billion (+22%)
$2
DEBT MANAGEMENT 2.9
$1 2.4 ST Debt LT Debt
• In Q3 NLMK placed debut Eurobonds and additional
$0
RUR notes totaling $883 million 30 Jun 12 Debt raising Debt FX rates and 30 Sep 12
settlements other factors
• Average debt maturity extended to 2.7 years
RATING
• Investment grade rating (S&P, Moody’s, Fitch)
AVERAGE MATURITY AND NET DEBT/EBITDA2 CURRENCY OF THE DEBT AND REVENUE
Weighted average Debt currency 2 Revenue currency3
2.0 Net debt/EBITDA
3.2 maturity period 100%
100%
3.0
3.0 80% 35%
80% 40% 35%
1.90
2.8 2.7 1.84 60%
60% 18%
13% 25%
2.6 2.5 40% 40%
Years 1.69
2.4 20% 46% 47% 20% 40%
2.2 1.5 0% 0%
Q1 2012 Q2 2012 Q3 2012 Q1 2012 Q2 2012 Q3 2012 Q2 2012 Q3 2012 Q3 2012
1. Cash and equivalents and ST deposits RUR USD Euro
2. As of 30.09.2012г. 13
3. Management accounts data

14. MATURITY
DEBT MATURITY LIQUID ASSETS AND ST DEBT MATURITY1
• Substantial liquidity cushion and portfolio of $3,500
$ Committed
million credit lines
instruments for debt restructuring $3,000
Cash and
• Short-term debt $2.43 billion $2,500
1,070
equivalents
203
$2,000
o Settlement of RUR three year notes in 493
$1,500
Q4 2012 $1,000 816 2,285
1,814
o Short term part of PXF $500 773
• Long term debt $2.85b illion $0
Liquid Q4 12 Q1 13 Q2 13 Q3 13
o incl. RUR notes and long term part of PXF, ECA assets
and liabilities of SIF
INTEREST EXPENSE3 TOTAL DEBT MATURITY2
$70 20% $2,500 $
$ million
$60 million
15% $2,000
$50
$40
10% $1,500
$30
$20 $1,000
5%
$10
$500
$0 0%
Q4 2011 Q1 2012 Q2 2012 Q3 2012
$0
Interest expense Interest expense to EBITDA (right hand) 2012 2013 2014 2015 and onward
PXF Ruble bonds ECA EBRD NLMK Europe Others Eurobonds (USD)
1. The ST maturity payments include interests accrued and bond coupon payments in 2012
2. The maturity payments do not include interests
3. Quarterly figures are derived by computational method based on reporting data for the 9M, 12M 2011 and for the 3M, 6M, 9M 2012. 14

15. OUTLOOK
PRODUCTION OUTLOOK
• Q4 2012: steel output to be at 3.7 m t, -2% q-o-q
• 12M 2012: 15 m t, + 25% y-o-y
FINANCIALS
• Revenue will decline by 1-5% q-o-q mainly due to lower seasonal demand
MARKET OUTLOOK
• Steel prices hit the bottom in Q4 2012
• Lower seasonal activity for the overall steel sector in the end of the year
• 2013 steel demand is likely to remain weak with possible anemic growth as compared to 2012
15

16. NLMK
Investor relations
Russia, 115054, Moscow
Bakhrushina str, 18, bldg 1
t. +7 495 915 15 75
f. +7 495 915 79 04
ir@nlmk.com
www.nlmk.com
16