#1TMK TMK IR PRESENTATION December 2018#2TMK Content Company Overview..... TMK Russian Division: Market Overview...... TMK American Division: Market Overview..... Strategic Overview..... 3 10 19 28 Environmental, Social & Governance.. 31 Summary Financial Results.... 35 Appendix Summary Financial Accounts. 42 Appendix Capital Structure....... 47 - Appendix TMK Products.. 49 Appendix Other Materials... 5.4 54 2#3TMK Company Overview 3#4TMK TMK- Global Supplier of Full Range of Pipes for Oil and Gas Industry More than 20 production sites in Russia, the USA, Canada, Romania and Kazakhstan, with trade offices in 10 countries 2018 global drilling activity by geography (number of wells drilled)(a) Russia: 11 production facilities 1 trade house 1 R&D centre Canada: ■ 1 production facility ■ 1 trade office Canada 15% MANAGEMENT PRODUCTION SALES OIL AND GAS SERVICES RESEARCH & DEVELOPMENT TMK sales by region (2017) ME & Gulf C.Asia & 3% Region Caspian Region 2% Others 1% Europe 7% Americas 26% Source: Company data USA 47% Russia 20% Romania: 2 production facilities 1 trade house Kazakhstan: 1 production facility 1 trade house USA: 10 production facilities 1 trade house 1 R&D centre TMK sales by product (2017) Welded LD Welded Line Pipe Russia 61% Welded 10% OCTG 4% Welded Industrial 8% Seamless Industrial 15% 7% Key financials (US$min) 2014 2015 2016 2017 Oil & Gas = 77% Revenue 6,009 4,127 3,338 4,394 Adj. EBITDA 829 651 530 605 Seamless OCTG 42% Adj. EBITDA 14% 16% 16% 14% Margin (%) FCF(b) 252 498 395 77 Seamless Line Pipe 13% Net Profit (Loss) (217) (368) 166 30 Net Debt 2,969 2,496 2,539 2,688 Note: Percentages and other figures included in this presentation are subject to rounding adjustments. Totals therefore do not always add up to exact arithmetic sums (a) Spears & Associates. Excluding China and Central Asia. Onshore and offshore drilling (b) Calculated as Net cash flows from operating activities plus Net cash flows used in investing activities#5TMK TMK Today - Key Investment Highlights 1 Industry-leading market position and large modern asset base Dominant #1 player in seamless OCTG industry in Russia and Top-3 in the US State-of-the-art underutilised production base with major investments completed over 10 years in 2004-14 Established longstanding relationships with major oil & gas upstream and midstream players 2 Combined exposure to some of the most attractive and dynamic regional oil & gas markets Russia - large low-cost oil producing region; a major market with increased drilling activity in 2017 TMK - dominant player in Russian oil & gas with 38% (a) market share for pipes used in the oil and gas industry, 64% (a) market share in seamless OCTG TMK 5 4 3 US OCTG market is at the recovery stage, following a c.75% demand contraction in 2014-2016 - with shale industry supported by OPEC agreement and conducive political environment under new administration TMK - Top-3 US OCTG producer with its market share at 10% in 2017 Low-cost position and stability of margins underpinned by significant vertical integration High degree of vertical integration in the seamless business due to in-house steel production Ability to pass through costs of steel products - demonstrated by stable margins throughout the cycle Substantial improvement in the global competitive positioning on the back of Ruble devaluation in 2014-16 Cost-cutting discipline and consistent focus on de-leveraging Cost-cutting programs with Adjusted EBITDA (b) effect of US$100m+ in the each of the past 3 years; disciplined capex Continuous reduction in net debt (US$1bn+ reduction in net debt since 2013) Superior governance practices and uniquely stable and experienced management team Core management team unchanged since IPO in 2006 5 Independent Directors on the Board with vast diversified international and domestic experience Source: Company data Notes: (a) Company estimates for FY 2017 (b) Adjusted EBITDA for TMK represents profit/(loss) for the period excluding finance costs and finance income, income tax (benefit)/expense, depreciation and amortisation, foreign exchange (gain)/loss, impairment/ (reversal of impairment) of non-current assets, movements in allowances and provisions (except for provisions for bonuses), (gain)/loss on disposal of property, plant and equipment, (gain)/loss on changes in fair value of financial instruments, share of (profit)/loss of associates and other non-cash, non-recurring and unusual items 5#6TMK TMK Market Exposure OCTG consumption in Russia and the US (m tonnes) 10 Global E&P investments (US$ bn nominal) 800 ■Russia US 700 2 8,4 8 7,7 600 6,9 500 6 5,6 400 6,5 4.7 5,7 4,6 4 300 3,8 2.7 200 100 2,3 2,0 1,9 1,8 1,9 0 0 2013 2014 2015 2016 2017 Source: Metal Expert for Russian OCTG consumption, Preston Pipe & Tube Report for US statistics 6 2010 2011 2012 2013 2014 2015 2016 2017 2018E 2019E Source: Rystad Energy 2020E Australia Europe Africa South America Asia Russia Middle East North America#7TMK vallourec TMK - Superior Earnings Resilience Through the Cycle M Tenaris 4 288 4 402 3 871 3 781 3 458 3 661 3 675 1 866 1 842 2 987 1 461 1 113 1 049 885 1 046 2 633 Total pipes sales volume 2 422 2 560 2 410 2 412 2 668 (ths. tonnes) ---------------- 981 605 1 990 355 2 618 461 2 624 2 323 2 159 2 256 630 1 670 1411 1 281 2 612 2 790 2006 2 028 2 157 1 994 1 635 Adjusted EBITDA margin(a), % Cash conversion (b) T 2013 2014 2015 2016 2017 9M 18 2013 2014 2015 2016 2017 9M 18 2013 2014 ■Seamless Welded ■Seamless Welded 2015 2016 ■Total sales 2017 9M 18 15% 16% 16% 14% 14% 14% 26% 26% 20% 18% 18% 16% 15% 14% 2% 0,1% 2013 2014 2015 2016 2017 9M 18 2013 2014 2015 2016 2017 9M 18 (2%) (7%) 2013 2014 2015 2016 2017 9M 18 60% 65% 68% 67% 61% 64% 73% 60% 2013 2014 2015 2016 2017 9M 18 Source: Companies' public reporting 75% 55% 41% 38% 7% n.m. n.m. n.m. (51%) (32%) 2013 2014 2015 2016 2017 9M 18 2013 2014 2015 2016 2017 9M 18 Note: (a) Adjusted EBITDA for TMK represents profit/(loss) for the period excluding finance costs and finance income, income tax (benefit)/expense, depreciation and amortisation, foreign exchange (gain)/loss, impairment/ (reversal of impairment) of non-current assets, movements in allowances and provisions (except for provisions for bonuses), (gain)/loss on disposal of property, plant and equipment, (gain)/loss on changes in fair value of financial instruments, share of (profit)/loss of associates and other non-cash, non-recurring and unusual items (b) Calculated as (Adjusted EBITDA - Capex) / Adjusted EBITDA 7#8TMK Vertically Integrated Model Ensuring Margin Stability Operating in one of the lowest cost regions for steel production globally Fully vertically integrated seamless pipe production (upstream and downstream) across all regional divisions Steel products price volatility (US$/t) 543 531 Ability to pass through increases in the cost of steel products to end-customers 590 596 556 500 Resilient margin throughout the cycle of high and low steel prices In 2016, an agreement with Metalloinvest for supply of hot- briquetted iron ("HBI") was signed Seamless pipe - simplified value chain TM Scrap, HBI EAFS Refractories, ferroalloys and other consumables 387 347 2013 2014 2015 2016 2017 1Q 2018 2Q 2018 3Q 2018 HRC (FOB, Black Sea) Source: Metal Expert Pipe making facilities TMK Production of billets Piercing, elongation, reduction of billets; pipe finishing TMK gross margin by product segments I 27% 26% 25% 24% 24% 23% Welded pipe - simplified value chain Steel coil/ plate Pipe making facilities 13% 12% 10% 11% 8% 6% TMK Bending of steel coil or plate followed by welding the seam at the wedges Perimeter of TMK operations in the value chain 8 2013 2014 2015 2016 2017 9M 18 ■Seamless ■ Welded Source: TMK data#9Strong Position in Multiple End-Markets for Pipes Beyond TMK Oil & Gas Automotive RENAULT TOYOTA Civil Construction ■ TMK-ARTROM is qualified as an authorised supplier for such companies as Dacia (a subsidiary of Renault) Supplier for Toyota Energy and Chemicals " Galvanised pipe for the outer steel frame of the Otkritie Arena stadium in Moscow Impact resistant seamless pipe shipped for the construction of Zenit Arena stadium retractable roof in St Petersburg Structural steel pipe for the stadium roof in Samara Diversified Hi-Tech Solutions Pipe shipments to energy and petrochemical businesses 6 TMK-INOX stainless pipe of 8-114 mm diameter, used in nuclear, aircraft, automotive, aerospace and energy industries#10TMK TMK Russian Division: Market Overview 10#11Oil Production in Russia Remains Strong, However There Are TMK Changes to its Composition... Oil production remains well above 11.2 MMbpd whilst adhering to the new agreement with OPEC. Gradual stagnation of oil production from brownfields is accompanied by development of greenfield projects Russian total oil output, MMbpd 11,6 11,3 11,0 10,7 10,4 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2015 Source: Interfax, Info TEK 2016 2017 2018 Oil production structure, % 8% 8% 80% 100% 8% 8% 8% 8% 9% 9% 9% 10% 1% 4% 6% 9% 11% 14% 15% 17% 19% 20% 60% 40% 20% 0% 2017 2018E 2019F 2020F 2021F 2022F 2023F 2024F 2025F 2026F ■Brownfields production ■Offshore production Source: RPI ■Greenfields production ■Hard to recover reserves OCTG demand is growing supported by existing level of production and development of greenfields Meters (min) 40 40 30 20 20 10 3,4 3,0 2,2 ANN 2,6 1,8 1,4 0 1,0 2005 2007 2009 2011 2013 2015 2017 2019E 2021E Meters drilled (LHS) OCTG demand (RHS) Source: Interfax, Info TEK, Spears & Associates, TMK estimates 11 Tonnes (mln)#12TMK ...and This Creates Long-term Demand for High-End Oil & Field Services Russian drilling activity remains solid with development drilling activity growing Russian drilling, kmpd 80 Russian oil drilling growth broken down, km 76 77 60% 3% 3% 7% 68 20 534 60 km/d 21 080 14% 60 57 3 60 54 53 49 48% 40% 41% 40 40 36% 33% 30% 20% 20 20 21% 12% 14% 0 0% 2011 2012 2013 2014 2015 2016 2017 9M 9M2017 Rosneft* Lukoil SurgutNG Tatneft GPN Other 9M2018 2018 Total drilling % of horizontal drilling (RHS) Source: Interfax, CDU TEK Source: CDU TEK Albeit quality of Russian reserves continues slowly deteriorating Watercut, % Average well depth, km 45% 88% 3,6 41% 87% 37% 3,2 33% 86% 2,8 29% 25% 85% 2,4 '11 '12 '13 '14 '15 '16 '17 '11 '12 '13 '14 '15 '16 '17 2011 2012 2013 Development 2014 2015 2016 2017 1H2018 Exploration Horizontal Source: CDU TEK Source: CDU TEK 12#13TMK Attractive Portfolio of Premium OCTG Projects Arctic LNG-2 • Contract term: 2017-2022 • Products supplied: OCTG with premium connections Yamal LNG • Contract term: 2014-2019 • Products supplied: OCTG including pipes with premium connections, line pipes, LDP Prirazlomnoye field • Contract term: 2013-2019 ⚫ Products supplied: OCTG with premium connections and GreenWell technology GAZPROM NEFT NOVATEK GAZPROM Novo-Urengoyskoye field • Contract term: 2014-2019 • Products supplied: OCTG from Cr13 Steel ROSNEFT CNPC TOTAL Silk RoadPand 2842 NOVATEK ROSNEFT ROSNEFT GAZPROM Messoyakhskoye field • Contract term: 2016-2020 Products supplied: OCTG including pipes with premium connections, line pipes, LDP Vankorskoye and Suzunskoye fields • Contract term: 2008-2019 • Products supplied: OCTG including pipes with premium connections, GreenWell technology, line pipes, LDP SGAZPROM GGAZPROM Yuzhno-Kirinskoye field Contract term: 2017-2019 • Products supplied: OCTG with premium connections JUK LUKOIL Caspian offshore projects • Contract term: 2010-2020 • Products supplied: OCTG with premium connections, LDP Russkoe field • Contract term: 2016-2019 • Products supplied: OCTG with premium connections including vacuum insulated tubing (VIT) Koviktinskoye field • Contract term: 2019-2023 • Products supplied: OCTG including pipes with premium connections Chayandinskoye field • Contract term: 2016-2023 ⚫ Products supplied: OCTG including pipes with premium connections 13#14TMK TMK's Home Market is One of the Lowest Cost Oil Producing Regions Global oil production supply curve Coal to Liquid- Gas to Liquid Asia DW(3) Permian tight Breakeven price (U.S.$/Boe) (1) 50 50 125 100 Low-cost supply completely in the money at current Brent price 75 Brent October 2018 Brent Crude 5 Year Low 25 OPEC, Middle East and Africa Russia, Caspian region* 0 20 40 S. America Aus. and Pacific Non-OPEC) Asia conv. 60 60 NA conv. Bakken- NA DW(3) 1 Eagle Ford EOR(2) Europe VZ extra heavy Canadian Oil Sands Arctic Africa Offshore SA DW (3) (primarily Brazil) Production (MBD) Even with oil at 5 year lows, the low cost Russian and Caspian region is able to remain profitable unlike the majority of its international counterparts. In 2015 and 2016, Russia was the only region globally to maintain healthy drilling activity and stable OCTG demand. Source: IEA World Energy Outlook; EIA International Energy Outlook; EIA Annual Energy Outlook; Morgan Stanley Notes: (1) Breakeven price assumes a 10% return, and NPV of zero; *includes Azerbaijan, Kazakhstan, Turkmenistan and Uzbekistan; (2) Enhanced oil recovery; (3) Deep Water 14 80#15TMK Russian Tube and Pipe Market 12 mln tonnes 10 00 CO + 2 0 T Source: TMK estimates No.1 on the Russian tube and pipe market 9M 2018 Source: TMK estimates, based on 9M 2018 numbers TMK 23% 15 2018E 2018-2022E CAGR 2% 2019E 2020E 2021E 2022E 33% market share of energy pipe demand 9M 2018 Source: TMK estimates, based on 9M 2018 numbers TMK 33% Non-Energy Energy#16TMK Strong Position on the Domestic Market TMK share of seamless OCTG remains high Seamless OCTG market share, % Source: TMK estimates 26% 62% 12% ■ TMK Import ■ Other local producers 16 Development of conventional and unconventional reserves will require the use of non-conventional drilling techniques and reliable OCTG products Russian seamless OCTG market is strong but due to high level of inventories slightly decreased by 5% YoY in 9M18 ■ TMK is a leader in the seamless OCTG production on the Russian market with a more than 60% market share for 9M 2018 Growing oil and gas drilling market in Russia 30 20 10 132515 '000 km 2005 10,6 2006 2007 2008 2009 2010 2011 2012 2013 Source: Spears & Associates Annual development drilling volume Total new wells drilled (rhs) 2014 2015 2016 2017 2018E 12 000 10 000 8.000 6 000 4 000 2 000 0 units#17TMK LDP Demand in Russia LDP demand in Russia, 2013-2022E Booming market '000 tonnes 3,500 15% 3,000 2,500 20% Recovery 20% 2,000 1,500 T 26% 26% 30% 20% 19% 21% 23% 11% 11% 33% 12% 15% 30% 11% 65% 12% 1,000- 26% 12% 69% 70% 54% 59% 66% 67% 500 58% 55% 44% 0 2013 2014 2015 2016 2017 2018E 2019F 2020F 2021F 2022F ■Gazprom ■Transneft ■ Others Source: TMK estimates ■ For the next three years we expect the LDP market to increase to approximately 2.2 mln tonnes ■ Major projects planned: Power of Siberia (GAZP), Bovanenkovo-Ukhta 3 (GAZP), Power of Siberia-2 (GAZP), Sakhalin-Khabarovsk-Vladivostok GTS (GAZP), maintenance needs of Transneft and Gazprom 17#18TM Strategic Cooperation Supporting Growth Strategic cooperation with key customers Partnership Memorandum Scientific and Technological Cooperation Technology Partnership Program ■ Long-term agreements with key customers to develop and supply innovative premium products with related services will strengthen TMK's position ■Import substitution programs guarantee purchase of tubular products and related services ■ TMK's innovative products are able to considerably improve the energy efficiency of wells, as well as safety and environmental impact 18#19TMK TMK American Division: Market Overview 19#20Source: EIA TMK Improving Oil & Gas Market Fundamentals Drive U.S. Shale Production... Sentiment continues improving as global crude oil supply and demand balances keep tightening Global capex spending in oil and gas has bottomed but it has only recovered modestly with a focus on US shales drilling efforts rather than long-term and more expensive projects Growth in exports and consumption will contribute to natural gas prices rising from an average of $2.99/MMBtu in 2018 to $3.12/MMBtu in 2019 U.S. crude oil production MMbpd 12 10 10 8 6 5,1 4 2 0 5,0 5,3 5,5 5,6 6,5 2007 2008 2009 2010 2011 2012 9,4 9,4 8,7 8,9 7,5 2013 2014 WTI Crude Oil ($/bbl) Improved sentiment and price in 9M 2018 75 70 65 60 55 50 45 40 1Q 2Q 3Q 4Q 1Q 2Q 2017 2018 30 3Q 2,0 T 4,0 3,5 3,0 2,5 US Natural Gas ($/MMBtu) Source: EIA U.S. shale oil production (1) is growing U.S. shale oil production (1) (MMbpd) Jan-07 Nov-07 Sep-08 0 2 + 60 80 60-Inr May-10 Jul-14 May-15 Mar-16 Jan-17 2015 2016 2017 Nov-17 2018E Sep-18 Mar-11 Jan-12 Nov-12 Sep-13 20 20 Source: EIA Notes: (1) Includes total oil production from Anadarko, Appalachia, Bakken, Eagle Ford, Haynesville, Marcellus, Niobrara, Permian & Utica 10,7#21TMK Which is Sustainable in the Long Term at Current Oil Price Levels Continental U.S. tight oil cost curve 120 Niobrara Breakeven U.S.$/bbl Brent equivalent 100 80 60 Mid- continent 40 40 20 Other 0 0 1 Wolfcamp (Permian) 2 3 Eagle Ford 4 Cumulative liquids production 2026E (MMbpd) ■Weighted average breakeven price based on 2026E production Source: Wood Mackenzie Bone Spring (Permian) Bakken 2018 YTD WTI average price 5 6 7 8 During the past 2 years, U.S. shale players have managed to decrease production costs Drilling technology has evolved, driven by efficiency requirements Key changes included higher intensity of drilling, longer laterals, significantly higher usage of proppants and equipment and well string standardization Despite a wide variation between plays, many U.S. shale producers are profitable at oil prices in the U.S.$50-60/bbl range in the long term A number of shale plays, incl. Permian and Eagle Ford basins as well as Mid-continent region of the U.S., are profitable at around U.S.$45-50/bbl 21#22TMK Driving Increasing Unconventional Horizontal Drilling ... Horizontal and directional drilling represents 94% of all US drilling activity in 2018 According to Spears & Associates estimates, 2018 U.S. drilling and completion spending will be 26% above 2017 and increase by 9% YoY in 2019E Growing number of available productive benches means that for any drilled well there is the potential for additional drilling activity further down the line U.S. active rig count by type of drilling % as of year end 100 32 31 75 27 27 50 56 58 63 25 45 33 17 13 11 7 6 22 22 99 65 73 33 79 81 86 87 13 11 10 13 10 9 9 0 T 2010 2011 2012 2013 2014 2015 2016 2017 9M 2018 Potential for additional drilling activity: Permian basin (Delaware sub-basin) example Avalon 1st Bone Spring 2nd Bone Spring 2010 3rd Bone Spring Up Wolfcamp A Lw Wolfcamp A Wolfcamp B Wolfcamp C Number of benches increased 250% Source: Spears & Associates, Drilling Production Report as of September 2018 22 22 2017 U.S. D&C spending ($bn) Source: Baker Hughes ■ Directional Horizontal ■ Vertical U.S. drilling and completion spending $225 $180 $135 $90 $45 $0 Source: Spears & Associates 2019E 2020E 2021E 2022E 2023E 2024E 2025E#23TMK...Growing Rig Count and Footage Drilled per Rig ... U.S. average annual rig count(1) 2 500 Footage drilled per rig (000's) 2 000 1 500 1 000 500 1 879 1919 1 862 1 761 1 546 978 509 400 CAGR 7% 312 300 277 277 276 212 219 192 1 011 200 169 173 876 100 0 0 2010 2011 2012 2013 2014 2015 2016 2017 2018E 2010 2011 2012 2013 2014 2015 2016 2017 2018E Source: Baker Hughes, Spears & Associates, Inc. Source: Spears & Associates, Inc. Rig count increased by more than 70% YoY in 2017. According to Spears & Associates, the rig count is expected to increase by 15% YoY in 2018E Number of rigs used for horizontal drilling continued to increase in 2018, according to Baker Hughes According to Spears & Associates, over the past 8 years footage drilled per rig grew at a CAGR of 7% Notes: (1) Numbers for 2007 - 2017 based on Baker Hughes data, numbers for 2018E based on median between BTU Analytics, Raymond James, and Spears & Associates estimates. 23 23#24TMK ... Coupled with More Wells Drilled per Rig and Longer Laterals ... The recovery in spending and rig count since 2016 is more significant when accounting for efficiency and productivity gains achieved by producers over the same period Drilling times have fallen sharply in most regions resulting in fewer rigs needed to perform the same work Horizontal wells drilled per rig 20 15 17,0 14,8 15,2 15,8 11,2 9,7 10 8,0 7,9 6,8 5 As producers continue to innovate, well lengths increased, frac stages rose and proppant usage increased 0 2010 2011 2012 2013 2014 Source: Baker Hughes Rig Count, Spears & Associates Increased lateral lengths and greater drilling complexity are driving greater spending on technologically advanced drilling consumables, such as OCTG with premium and semi-premium connections 24 Average U.S. lateral length (Feet) 10 000 2015 2016 2017 2018E 8 706 8 194 7 826 7 323 7 500 6 880 5 000 2 500 0 2014 Source: Spears & Associates, Inc. 2015 2016 2017 2018E#25TMK Resulting in OCTG Consumption Growth... OCTG consumption per rig has nearly doubled since January 2013, allowing for significant recovery in the sector despite having fewer than half of the rigs in operation Seamless pipe has increased its share of total U.S. pipe volume as the result of increased horizontal and directional drilling as well as longer laterals According to Preston Pipe, seamless pipe represented approximately 57% of total U.S. OCTG shipments during the nine months ended September 30, 2018 U.S. consumption of OCTG is expected to reach 5.4 million metric tonnes in 2018E vs. 4.6 million metric tonnes in 2017 OCTG consumption per rig U.S. rig count 2 500 2 000 1 500 1.000 500 0 Jan-13 May-13- Sep-13 Jan-14 May-14 Sep-14- Jan-15 May-15 Sep-15- Jan-16 May-16 Sep-16 Jan-17 May-17 Sep-17 Jan-18 May-18 ⚫U.S. Rig Count Source: Preston Pipe, Baker Hughes Sep-18 550 500 450 400 350 300 250 200 OCTG Consumption per Rig (tonnes/month) 25 OCTG shipments mix 100% 80% 37% 48% 51% 48% 47% 42% 53% 55% 54% 60% 40% 63% 52% 49% 47% 52% 53% 58% 45% 46% 20% 0% 2010 2011 2012 2013 2014 ■ Seamless Source: Preston Pipe, Baker Hughes 2015 2016 2017 2018 ■ Welded Consumption per rig (tonnes/month)#26TMK... Inventory Normalization, Higher Efficiency ... US OCTG inventories have reached the normalized levels of 2014 as shipments outpace consumption Despite months of inventory having reached 2014 levels, the monthly absolute inventory is meaningfully below pre-crisis levels due to higher industry efficiency: Design has standardized resulting in more obsolete inventory the E&P investment has spilled over into management of inventory: the amount of pipe on the ground that was typically required to maintain a certain rig level has decreased from previous cycles Standardized diameters of OCTG piping Increased shipment levels bring months-of-inventory back to pre-downturn levels Absolute Inventory, mln tonnes Monthly Absolute Inventory Months of Inventory 4,0 18 3,5 3,0 2,5 15 12 9 Months of Inventory Chevron Permian ■ Total Weight per well: 492 NT 13 3/8" XTO Bakken ■ Total Weight per well: 323 NT 9 5/8" 7" 9 5/8" Cabot Northeast ■ Total Weight per well: 267 NT ' 20" 13 3/8" 9 5/8" 5 1/2" Source: Company data 2 7/8" 4 1/2" 2 7/8" 5 1/2" 2 7/8" 26 26 10 1,0 1,5 15 Jan-09 2,0 Sep-09 May-10 Jan-11 Sep-11 Source: Preston Pipe & Tube Report May-12 Jan-13 Sep-13- May-14 Jan-15 Sep-15 May-16 Jan-17 Sep-17 May-18 0 3 6#27TMK ... and Growth of OCTG Prices U.S. distributor welded OCTG vs. HRC prices (U.S.$/tonne, monthly average) 2 100 1 900 +61% Prices have rallied from the low in April 2016. Since the trough, welded OCTG prices increased by more than 60% and seamless OCTG prices by almost 50% 1 400 700 1 500 1 100 700 +77% Apr-16 Dec-16 Aug-17 Apr-18 Prices have stabilized in recent months: average welded and seamless prices by the end of 3Q 2018 were flat when compared to prices by the end of the previous quarter Following the implementation of Section 232, HRC prices grew by almost 300US$/Tn until August when they started a downward trend which, according to market analysts, is expected to continue during 2019 0 300 Jan-13 Jun-14 Nov-15 Apr-17 Sep-18 Welded OCTG price HRC price Source: Pipe Logix, AMM U.S. distributor seamless OCTG vs. scrap prices (U.S.$/tonne, monthly average) 2 400 1 600 800 1.800 1 400 1 000 600 +46% +58% 200 0 Jan-13 Jun-14 Nov-15 Apr-17 Sep-18 Apr-16 Dec-16 Aug-17 Apr-18 Seamless OCTG price Scrap price Source: Pipe Logix, AMM 27#28TMK Strategic Overview 28#29TMK Key Strategic Pillars Enhance leadership in key segments and enter new product niches Optimise vertical integration Enhance the sales platform and leverage TMK's global scale • Dominate the Russian OCTG and line pipe markets Remain in the TOP 3 leading OCTG producers in the USA Increase the share of high-tech products in the Russian division's revenue to 50% by 2022 and maintain a leading position in the Russian market for premium connections Increase capacity utilization of steelmaking facilities through higher production volumes of steel billets and other products, and maximize the financial impact Expand presence in further processing of tubular products (drill pipe, coating) Develop a service offering of ready-to use comprehensive engineering solutions for customers Expand commercial footprint of TMK's products and services Develop strategic partnerships with major customers and global consumers Focus on offering products that have a global market and stable demand outlook, i.e.high-tech seamless pipes and premium connections Focus on innovation and digitalisation Enhance operational excellence ☐ ■ Develop e-commerce across all divisions via TMKe Trade, the first tubular goods Internet shop in Russia Use cutting-edge digital technology to improve product quality and cut costs Foster a culture of continuous operational improvements and production cost cutting Ensure consistent product quality through increasing the sustainability of technologies and personnel qualification Maximize operating cash flow Monetize international assets, strategic alliances and joint ventures in all regions of Reduce leverage to 3.0x Net Debt(a)/ EBITDA (b) as of FY2019 presence Strengthen financial performance and investment appeal Reduce leverage to 2.5x Net Debt (a)/ EBITDA (b) as of FY2021 Note: (a) Net Debt represents interest bearing loans and borrowings plus liability under finance lease less cash and cash equivalents and short-term financial investments (b) Adjusted EBITDA represents profit/(loss) for the period excluding finance costs and finance income, income tax (benefit)/expense, depreciation and amortisation, foreign exchange (gain)/loss, impairment/ (reversal of impairment) of non-current assets, movements in allowances and provisions (except for provisions for bonuses), (gain)/loss on disposal of property, plant and equipment, (gain)/loss on changes in fair value of financial instruments, share of (profit)/loss of associates and other non-cash, non-recurring and unusual items 29#30TMK Maturity Profile as at September 30, 2018 US$ mln 700 600 ■ EUR ■RUB USD 500 400 366 300 150 200 175 173 202 80 80 65 647 550 438 265 237 156 134 142 As at September 30, 2018, Net Debt amounted to US$2,624 mln In January 2018, TMK fully redeemed the remaining part of its US$500 mln 7-year Eurobond issue in the total nominal value of US$231 mln The weighted average nominal interest rate decreased by 94 bps since the end of 2017 to 7.22% Credit Ratings: S&P B+, Stable Moody's B1, Stable Debt currency structure 196 100 55 55 172 76 135 172 235 70 61 70 132 142 99 34 55 RUB 51% 95 21 21 60 0- 15 19 3 9 46 1 19 19 19 23 23 22 22 68 1 1 1 3 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 3Q 2018 2019 T 2020 2021 2022 2023 2025 EUR 3% Source: TMK management accounts (figures based on non-IFRS measures), TMK estimates Note: Certain monetary amounts, percentages and other figures included in this presentation are subject to rounding adjustments. Totals therefore do not always add up to exact arithmetic sums. 30 USD 46%#31TMK Environmental, Social & Governance 31#32TMK Corporate Governance Key considerations The Board of Directors is comprised of 11 members, including 5 independent directors, 4 non-executive directors and 2 executive directors. ■ TMK's day-to-day operations are managed by the CEO and the Management Board which consists of eight members. The Company has an integrated system of internal controls which provides assurance as to the efficiency and management of risks of operations. Committees The Board of Directors has three standing committees: Audit Committee, Nomination and Remuneration Committee, Strategy Committee. The committees have been formed in compliance with PAO TMK's Corporate Governance Code, which specifically requires that the Audit Committee and the Nomination and Remuneration Committee include independent directors only, or, where it is not reasonably possible, comprise independent directors and non-executive directors only. Audit Committee Committee Nomination and Remuneration Committee Strategy Committee Chairman Peter O'Brien Independent director Sergey Kravchenko Independent director Alexander Shokhin Independent director DMITRY PUMPYANSKIY, Chairman of the Board of Directors, non-executive director Born in 1964. Graduated from the Urals Polytechnic Institute (now Ural Federal University) in 1986. Professor, PhD in Technical Sciences and Doctor of Economics. Relevant experience: Chairman of the Board of Directors of Sinara Group. Member of the Management Board of the Russian Union of Industrialists and Entrepreneurs. Member of the Board of Directors of World Steel Association. Member of the Management Board of the Russian Chamber of Commerce and Industry. Member of the Supervisory board of the Russian Steel Association. President of the Sverdlovsk Regional Union of Industrialists and Entrepreneurs. Chairman of the Supervisory Committee of Ural Federal University. YAROSLAV KUZMINOV, Independent director, member of the Board of Directors Graduated from the Lomonosov Moscow State University in 1979, Candidate of Sciences (Economics), Associate Professor. Relevant experience: Rector of National Research University "Higher School of Economics", Member of the Council of "Center for Strategic Research" Foundation, Member of All-Russian non-governmental Organization "Russian Rectors' Union", Member of the Executive Board of All-Russian industrial Association of employers "Russian Engineering Union", Member of non-profit partnership "Russian International Affairs Council", Chairman of the Council of Association of leading universities in the sphere of economics and management, Member of the Board of directors of JSC "Izdatelstvo Prosveshcheniye" and also is the member of governing bodies of other non-profit- making organizations. PETER O'BRIEN, Independent director, Chairman of the Audit Committee Born in 1969. Graduated from Duke University (USA) in 1991 and obtained an MBA from Columbia University Business School in 2000 and completed the AMP at Harvard Business School in 2011. Relevant experience: Member of the Management Board, Vice President, Head of the Group of Financial Advisors to the President of Rosneft, Co-Head of Investment Banking, Executive Director of Morgan Stanley in Russia, Vice President at Troika Dialog Investment Company, Press Officer at the US Treasury, Chairman of the Board of Directors of PAO TransFin-M. ALEKSANDER SHOKHIN, Independent director, Chairman of the Strategy Committee Born in 1951. Graduated from the Lomonosov Moscow State University in 1974. PhD, Doctor of Economics, Professor. Relevant experience: President of the Russian Union of Industrialists and Entrepreneurs, President of the Higher School of Economics State University, member of the Board of Directors of AO Russian Small and Medium Business Corporation, Board member at Lukoil, Russian Railways, member of the Public Chamber of the Russian Federation, member of the State Duma, Minister of Labour and Employment and Minister of Economic Affairs, Head of the Russian Agency for International Cooperation and Development, twice appointed as Deputy Head of the Russian Government, Russia's representative to IMF and World Bank. SERGEY KRAVCHENKO, Independent director, Chairman of the Nomination and Remuneration Committee Born in 1960. Graduated from the Moscow State University of Mechanical Engineering in 1982. Professor, Doctor of Technical Science. Relevant experience: President of Boeing Russia and CIS since 2002, responsible for the company's business development in Russia and CIS. Prior to joining Boeing in 1992 was a lead member of the Russian Academy of Sciences. ROBERT MARK FORESMAN, Independent director, member of the Board of Directors Born in 1968. Graduated from Bucknell University (USA) in 1990 and Harvard University Graduate School of Arts & Sciences in 1993. Relevant experience: Head of Barclays Capital in Russia, Deputy Chairman of the Management Board at Renaissance Capital, Chairman of the Management Committee for Russia and CIS at Dresdner Kleinwort Wasserstein, Head of Investment Banking for Russia and CIS at ING Barings, Vice Chairman at UBS Investment Bank. 32 32#33TMK Environmental Protection Environmental management system TMK is consistently managing our environmental efforts to ensure continuous improvement of our environmental performance and manage environmental risks across TMK's facilities. Eleven of the Company plants have implemented an ISO 14001 compliant environmental management system. All the certified plants were audited and confirmed compliance with the standard during the year. Six company's plants confirmed their compliance with updated ISO 14001:2015. Emission control TMK's facilities comply with the legislation covering air emissions inventory, regulation, and control, as well as operations in adverse weather conditions. Our emissions control activities ensure compliance with the prescribed air emissions limits. As a result, our total pollutant emissions decreased in 2017 by 10% to 11,100 tonnes. TMK compiles an inventory of greenhouse gas (GHG) emissions on an annual basis. Waste management The existing industrial waste management system is focused on practical procedures to reduce, recycle, and reuse waste, as well as reduce waste disposal. Water management Under TMK's Environmental Policy, the Company's water management strategy focuses on reducing water consumption and mitigating negative impact on water bodies. In 2017, the share of recycled water supply at TMK reached 95,46%. $37 mln TMK total environmental expenditures in 2017 increased by +50% y-o-y -2.4% y-o-y GHG emissions -5% y-o-y Overall water consumption 23 CAPEX projects to ensure legal compliance and environmental protection in 2017 -10% y-o-y Total pollutant emissions 95.46% Share of recycled water supply TMK supported the year of the environment held in Russia in 2017 as a nation-wide initiative. was 2017 YEAR OF ECOLOGY IN RUSSIA the TMK awarded environmental proactive policy during the year of the environment award by the Ministry of natural resources environment of the and Russian Federation. 150 at Local and corporate-wide initiatives implemented TMK's Russian division plants in the year of environment 33 33#34TMK Occupational Safety & Social responsibility Safety is our priority TMK makes systemic and consistent efforts to ensure a safe working environment for employees, guided by 2015 corporate- wide policy on occupational health and industrial safety aimed to mitigate risks, reduce injury rates, and spread safe manufacturing practices. The Company's facilities are audited on an annual basis for conformity to OHSAS 18001. All of TMK's plants comply with OHSAS 18001 standards. Steel Safety Day $9.2 mln TMK's total occupational health and safety costs during 2017 TMK has been taking part in Steel Safety Day, launched by the World Steel Association, every year since 2014. The Steel Safety Day 2017 involved not only TMK employees (35,343 people, 32% of whom performed audits) but also contractor employees, whose number more than doubled from 2016 (6,770 people vs. 3,059 people). Measures to identify safety risks associated with key workplace hazards were implemented across all production sites of the Company, representing 83% of our production capacity. Following the Steel Safety Day, TMK made efforts to eliminate or mitigate the identified safety risks. All planned actions were completed as of 31 December 2017. Sponsorship and charity Through sponsorship and charity, TMK seeks to foster a favorable social climate in the regions hosting our plants. We mainly focus on supporting social initiatives by non-profit organizations in health, education, culture, and sports on a project-by-project basis. All Russian plants operated by TMK run charitable programs and campaigns, and consistently provide aid to veteran organizations, as well as to children's and healthcare institutions. TMK's American division supported campaigns to collect toys and school supplies for children from disadvantaged families in Texas. TMK's European division supports local non-profit charitable organizations. TMK GIPI of TMK's Middle East division supports social and infrastructure initiatives run by the Municipality of Sohar. It is also involved in providing support to disadvantaged families and financing child care centres in Sohar and Liwa. 34#35TMK Summary Financial Results 55 35#36TMK FY Consolidated Results Snapshot Revenue US$ mln 6.000 5 000 4000 3 000 6 009 4 127 4 394 3 338 2 000 1.000 0 2014 2015 2016 2017 Volumes and realised prices Average USD/RUB rate (a) 37.97 60.66 66.90 58.35 Average US$1,464 US$1,078 US$970 US$1,181 revenue/ tonne US$1,085 US$921 US$796 US$1,075 5 000 4 402 3 871 3 781 4 000 3 458 1 842 3.000 1 461 1 113 1 046 2000 2560 1 000 2 410 2 412 2 668 0 2014 2015 2016 2017 Seamless ■Welded Thousand tonnes Adjusted EBITDA (b) 16% 16% 18% 800 14% 14% 700 15% 600 12% US$ mln 500 400 829 9% 651 300 605 530 6% 200 3% 100 0 0% 2014 2015 2016 2017 Source: TMK data Note: Adj. EBITDA margin, % Net profit 200 սլա $ՏՈ 166 100 30 0 (100) (200) (217) (368) (300) 2014 2015 2016 2017 Adjusted EBITDA margin, % (a) Average nominal USD/RUB exchange rate as published by the Central Bank of Russia. (b) Adjusted EBITDA represents profit/(loss) for the period excluding finance costs and finance income, income tax (benefit)/expense, depreciation and amortisation, foreign exchange (gain)/loss, impairment/ (reversal of impairment) of non-current assets, movements in allowances and provisions (except for provisions for bonuses), (gain)/loss on disposal of property, plant and equipment, (gain)/loss on changes in fair value of financial instruments, share of (profit)/loss of associates and other non-cash, non-recurring and unusual items 36#37TMK Gross Margin, SG&A and Cash Conversion Gross margin SG&A and corporate overheads (a) 693 600 524 544 437 800 30% 26% 24% 25% 24% US$ mln 20% 12% 13% 10% 10% 8% Capex and cash conversion (b) US$ mln 400 200 0% 0 2014 2015 2016 2017 2014 2015 2016 2017 ■Seamless ■Welded 68% 300 65% 67% 70% 61% 200 50% 293 236 100 208 30% 175 0 10% 2014 2015 2016 2017 Source: TMK data Note: Cash Conversion, % Key considerations Gross margin resilient through the cycle across both product lines Seamless segment accounting for more than 80% of consolidated gross profit and demonstrates consistently superior margins Major reduction in SG&A in response to the revenue decline in 2015-16 Relatively high share of fixed costs in seamless segment provides strong leverage to volume growth Significantly optimized lean cost structure due to stringent efficiency measures (a) Based on IFRS financial statements. Calculated as Gross Profit less Operating profit (b) Calculated as (Adjusted EBITDA - Capex) / Adjusted EBITDA. Adjusted EBITDA represents profit/(loss) for the period excluding finance costs and finance income, income tax (benefit)/expense, depreciation and amortisation, foreign exchange (gain)/loss, impairment/ (reversal of impairment) of non-current assets, movements in allowances and provisions (except for provisions for bonuses), (gain)/loss on disposal of property, plant and equipment, (gain)/loss on changes in fair value of financial instruments, share of profit)/loss of associates and other non-cash, non-recurring and unusual items 37#38TMK Segmental Quarterly Performance Dynamics Russian division American division Sales volume (ths.tonnes) Adjusted EBITDA(a), US$ mln Adjusted EBITDA margin(a), % 812 760 756 734 740 675 687 European division 128 158 185 199 199 210 190 45 48 42 50 47 53 48 1Q 17 2Q 17 3Q 17 4Q 17 1Q 18 2Q 18 3Q 18 1Q 17 2Q 17 3Q 17 4Q 17 1Q 18 2Q 18 3Q 18 1Q 17 2Q 17 3Q 17 4Q 17 1Q 18 2Q 18 3Q 18 127 132 120 124 107 111 106 1Q 17 2Q 17 3Q 17 4Q 17 1Q 18 2Q 18 3Q 18 42 39 49 45 26 21 16 9 5 6 7 11 10 13 1Q 17 2Q 17 3Q 17 4Q 17 1Q 18 2Q 18 3Q 18 1Q 17 2Q 17 3Q 17 4Q 17 1Q 18 2Q 18 3Q 18 18% 19% 17% 15% 13% 13% 14% 14% 13% 15% 13% 14% 13% 13% 14% 14% 11% 9% 9% 9% 5% 1Q 17 2Q 17 3Q 17 4Q 17 1Q 18 2Q 18 3Q 18 1Q 17 2Q 17 3Q 17 4Q 17 1Q 18 2Q 18 3Q 18 1Q 17 2Q 17 3Q 17 4Q 17 1Q 18 2Q 18 3Q 18 Source: TMK data Note: (a) Adjusted EBITDA represents profit/(loss) for the period excluding finance costs and finance income, income tax (benefit)/expense, depreciation and amortisation, foreign exchange (gain)/loss, impairment/ (reversal of impairment) of non-current assets, movements in allowances and provisions (except for provisions for bonuses), (gain)/loss on disposal of property, plant and equipment, (gain)/loss on changes in fair value of financial instruments, share of (profit)/loss of associates and other non-cash, non-recurring and unusual item 38#39TMK 3Q 2018 vs. 2Q 2018 Summary Financial Highlights Sales declined QoQ across all divisions Revenue decreased QoQ, reflecting lower pipe sales across all divisions and a negative currency translation effect 1 500 -11% QoQ Thousand tonnes 1 200 900 600 -14% QoQ 1 076 925 300 0 2Q2018 3Q2018 US$ mln 1 000 1 355 1 207 500 0 2Q2018 3Q2018 Adjusted EBITDA decreased QoQ, reflecting a weaker performance across all divisions Net loss was recorded, due to a loss on disposal of subsidiaries -17% QoQ 200 18% 15% 14% 15% 150 12% US$ mln 100 197 9% 164 6% 50 3% EBITDA margin, % 25 20 US$ mln 0 0% 2Q2018 3Q2018 15 10 19 5 0 -5 -10 2Q2018 3Q2018 -8 Source: TMK data 39#40TMK 9M 2018 vs. 9M 2017 Summary Financial Highlights Sales were up YoY across all divisions Revenue increased YoY, driven by improved results at all three divisions Thousand tonnes 7% YoY 3,000 2,400 1,800 2,798 2,987 1,200 600 0 9M2017 9M2018 US$ mln 4,000 20% YoY 3,000 2,000 3,835 3,191 1,000 0 9M2017 9M2018 Adjusted EBITDA increased YoY, driven by a stronger performance at all three divisions. Part of the increase was offset by a negative currency translation effect at the Russian division Net profit decreased YoY, due to a loss on disposal of subsidiaries recorded in 3Q 2018 17% YoY 600 18% 14% 500 14% 15% 400 12% սլա $ՏՈ 522 300 9% 444 200 100 0 do do do 6% 3% 0% 9M2017 9M2018 Source: TMK data EBITDA margin, % 40 40 US$ mln 50 40 54 50 30 20 20 46 -57% YoY 10 20 0 9M2017 9M2018#41WELDED TMK Seamless - Core to Profitability SEAMLESS US$ mln QoQ, YoY, 3Q2018 9M2018 9M 2018 gross profit breakdown (unless stated otherwise) % % Sales - Pipes, kt 606 -16% 2,006 1% Other operations Welded 4% Revenue 804 -12% 2,600 9% 15% Gross profit 193 -9% 603 9% Margin, % 24% 23% Avg revenue/tonne (US$) 1,326 4% 1,296 14% Avg gross profit/tonne (US$) 318 7% 301 7% Seamless 87% - Sales Pipes, kt Revenue 318 -11% 981 19% 315 -15% 1,004 30% Gross profit 18 -39% 62 -30% Margin, % 6% 6% Sales of seamless pipe generated 68% of total revenues in 9M 2018 Gross profit from seamless pipe sales represented 87% of 9M 2018 total gross profit Avg revenue/tonne (US$) 989 -5% 1,024 9% Gross profit margin from seamless pipe sales amounted to 23% in 9M 2018 Avg gross profit/tonne (US$) 57 -32% 63 -42% Source: Consolidated IFRS financial statements, TMK data Note: Certain monetary amounts, percentages and other figures included in this presentation are subject to rounding adjustments. Totals therefore do not always add up to exact arithmetic sums. 41#42TMK Appendix - Summary Financial Accounts 42#43(US$mln)(a) Revenue Adjusted EBITDA (b) Adjusted EBITDA Margin (b) (%) TMK Key Consolidated Financial Highlights 2017 2016 2015 2014 2013 4,394 3,338 4,127 6,009 6,432 605 530 651 829 986 14% 16% 16% 14% 15% Profit (Loss) 30 166 (368) (217) 215 Net Profit Margin (%) 1% 5% n/a n/a 3% Pipe Sales ('000 tonnes) 3,781 3,458 3,871 4,402 4,287 Average Net Sales/tonne (US$) (c) 1,162 965 1,066 1,365 1,500 Cash Cost per tonne (US$)(d) 862 692 783 1,030 1,108 312 476 684 595 703 Cash Flow from Operating Activities Capital Expenditure(e) 236 175 208 293 397 Total Debt(f) 3,239 2,836 2,801 3,223 3,694 Net Debt(f) 2,688 2,479 2,471 2,939 3,568 Short-term Debt/Total Debt 18% 9% 21% 24% 11% 4.4x 4.7x 3.8x 3.5x 3.6x Net Debt/Adjusted EBITDA Adjusted EBITDA/Finance Costs 2.3x 2.0x 2.3x 3.6x 3.9x Source: TMK Consolidated Financial Statements for 2017, 2016, 2015 and 2014 (a) IFRS financials figures were rounded for the presentation's purposes. Minor differences with FS may arise due to rounding (b) Adjusted EBITDA represents profit/(loss) for the period excluding finance costs and finance income, income tax (benefit)/expense, depreciation and amortisation, foreign exchange (gain)/loss, impairment/ (reversal of impairment) of non-current assets, movements in allowances and provisions (except for provisions for bonuses), (gain)/loss on disposal of property, plant and equipment, (gain)/loss on changes in fair value of financial instruments, share of (profit)/loss of associates and other non-cash, non-recurring and unusual items. (c) Sales include other operations and is calculated as Revenue divided by sales volumes tonnes (d) Cash Cost per Tonne is calculated as Cost of Sales less Depreciation & Amortisation divided by sales volumes (e) Purchase of PP&E investing cash flows (f) Total Debt represents loans and borrowings less interest payable; Net Debt represents Total debt less cash and cash equivalents and short-term financial investments 43#44TMK Income Statement (US$ mln) Revenue Cost of sales Gross Profit 2017 2016 2015 2014 2013 4,394 3,338 4,127 6,009 6,432 (3,521) (2,634) (3,282) (4,839) (5,074) 872 704 845 1,169 1,358 Selling and Distribution Expenses (261) (220) (260) (350) (379) General and Administrative Expenses (231) (196) (207) (278) (317) Adverstising and Promotion Expenses (7) (6) (8) (14) (12) Research and Development Expenses (11) (11) (13) (15) (13) Other Operating Expenses, Net (34) (4) (35) (35) (34) Foreign Exchange Gain / (Loss) 28 130 (141) (301) (49) Finance Costs, Net (268) (263) (269) (226) (245) Other (10) 35 (354) (150) 5 Income (Loss) before Tax 78 169 (443) (201) 312 Income Tax (Expense) / Benefit (48) (4) 75 (15) (98) Net Income (Loss) 30 165 (368) (217) 215 Source: TMK Consolidated Financial Statements for 2017, 2016, 2015 and 2014 Note: Certain monetary amounts, percentages and other figures included in this presentation are subject to rounding adjustments. Totals therefore do not always add up to exact arithmetic sums. (a) Calculated as Finance income less Finance costs 44#45TMK Statement of Financial Position (US$ min) 2017 2016 2015 2014 2013 ASSETS Cash and Cash Equivalents 491 277 305 253 93 Accounts Receivable 871 689 512 728 995 Inventories Prepayments 1,121 769 785 1,047 1,324 139 107 113 113 148 Other Financial Assets 0 42 0 1 0 Total Current Assets 2,624 1,883 1,715 2,142 2,561 Total Non-current Assets 2,913 2,853 2,697 3,508 4,857 Total Assets 5,537 4,736 4,412 5,649 7,419 LIABILITIES AND EQUITY Accounts Payable 950 735 682 831 1,111 ST Debt 610 268 600 764 398 Other Liabilities 178 48 41 48 62 Total Current Liabilities 1,738 1,051 1,323 1,643 1,571 LT Debt 2,725 2,650 2,201 2,459 3,296 Deferred Tax Liability 82 90 110 206 298 Other Liabilities 59 47 64 71 125 Total Non-current Liabilities 2,866 2,786 2,374 2,735 3,718 Equity 933 899 715 1,271 2,130 Including Non-Controlling Interest 50 55 53 66 96 Total Liabilities and Equity 5,537 Net Debt 2,688 4,736 2,479 4,412 2,471 5,649 2,969 7,419 3,600 Source: TMK Consolidated Financial Statements for 2017, 2016, 2015 and 2014 Note: Certain monetary amounts, percentages and other figures included in this presentation are subject to rounding adjustments. Totals therefore do not always add up to exact arithmetic sums. 45#46TMK Cash Flow (US$ mln) 2017 2016 2015 2014 2013 Profit/ (Loss) before Income Tax 78 169 (443) (201) 312 Adjustments for: Depreciation and Amortisation Net Finance Cost Others 263 242 251 304 326 268 263 269 226 245 (260) (154) 552 479 61 Working Capital Changes (253) (13) 105 (159) (159) Cash Generated from Operations 349 506 734 648 786 Income Tax Paid (38) (31) (51) (53) (82) Net Cash from Operating Activities 312 476 684 595 703 Capex (236) (175) (208) (293) Acquisitions 1 (11) (2) (60) Others 0 106 25 10 Net Cash Used in Investing Activities (235) (81) (185) (343) (397) (38) 12 (423) Net Change in Borrowings 318 (53) (193) 154 (93) Others (197) (365) (187) (206) (313) Net Cash Used in Financing Activities 121 (418) (381) (53) (407) Net Foreign Exchange Difference 17 (5) (65) (40) (5.0) Cash and Cash Equivalents at January 1 Cash and Cash Equivalents at YE 277 305 253 93 225 491 277 305 253 93 Source: TMK Consolidated Financial Statements for 2017, 2016, 2015 and 2014 Note: Certain monetary amounts, percentages and other figures included in this presentation are subject to rounding adjustments. Totals therefore do not always add up to exact arithmetic sums (a) Calculated as Finance costs less Finance income 46#47TMK Appendix - Capital Structure 47#48TMK Capital Structure Capital structure Key considerations TMK subsidiaries 0,01% Free float 34,94% ** TMK Steel * Holding Ltd, incl. affiliates 65.06% *The beneficiary is Dmitry Pumpyanskiy, Chairman of the Board of Directors of TMK. Includes shares owned by TMK Steel Holding Ltd and subsidiaries of TMK **Including Rusnano (5.3%) Source: TMK 48 88 TMK's securities are listed on the London Stock Exchange and the Moscow Exchange ■ As of September 30, 2018 35% of TMK ordinary shares were in free float ■ Total shares outstanding amount to 1,033,135,366 ■ One GDR represents four ordinary shares#49TMK Appendix - TMK Products 49 49#50TMK Wide Range of Products Seamless Welded OCTG Threaded pipes for the oil and gas industry including drill pipe, casing and tubing. The short-distance transportation of crude oil, oil products and natural gas. Line Pipe Automotive, machine OCTG Line Pipe building, and power generation sectors. Industrial Large- Diameter Industrial Premium Threaded pipes for the oil and gas industry including drill pipe, casing and tubing. Premium connections are proprietary value-added products used to connect OCTG pipes and are used in sour, deep well, off- shore, low temperature and other high-pressure applications. The short-distance transportation of crude oil, Premium oil products and natural gas. Connections (TMK UP) Construction of trunk pipeline systems for the long distance transportation of natural gas, crude oil and petroleum products. Oilfield Services Well equipment precision manufacturing, tools' rental, supervising, inventory management, threading and coating services. Wide array of applications and industries, including utilities and agriculture. 50 50#51TMK TMK Premium Product Offering TMK connections series Higher resistance to torque for casing while drilling and rotating A comprehensive line of semi-premium connections designed to outperform standard API connections Easy and reliable make-up Comprises connections with metal-to-metal seals and positive torque stops that provide gas tightness and ensure reliability in difficult well conditions Lite Classic Series Series Pro Series TMK PREMIUM SERVICE Torq Series Premium products and services TMK to maintain its share of premium connections market with greater focus on sales of 2nd and 3rd generation premium connections to improve sales efficiency and enhance competitive advantage TMK is actively developing HI-TECH products for unconventional reserves, including offshore deposits: OCTG: with Premium threading, Cr13, GreenWell technology, alloy OCTG (L80, C90, T95, P110) mostly with Premium threading Stainless steel pipe Pipe with increased corrosion resistance Vacuum insulated tubing Ability to withstand high tension, compression and bending loads at excessive internal and external pressure Extreme torsional resistance for high operational torque LDP Pipes with premium connections are designed for O&G wells developed in challenging exploration and production conditions, including offshore, deep-sea and Far North locations, as well as for horizontal and directional wells Source: TMK data 51#522009 ULTRA DQX 2011 2013 ULTRA DQXHT TMK BPN TMK-2S ULTRA GX 2013 2013 2016 TMK Premium Solutions: TMK UP ULTRA SF ULTRA SFII ULTRA FJ ULTRA FX ULTRA CX ULTRA QX SXC 2003 2013 2003 2003 2008 2009 Cal IV Cal IV Cal IV Cal II Cal IV Cal II Cal II Unique range of Premium products • Onshore/offshore • Sour gas Thermal ⚫ Arctic TWCCEP ⚫ Horizontal and extended reach • Drilling with casing Steam-Assisted Gravity Drainage (SAGD) Connections are available with GreenWell environment friendly technology ULTRA QX TORQ 2016 TMK 1 2004 TMK FMC 2005 TMK CS 2005 TMK TTL 01 2005 TMK GF 2005 TMK PF 2007 TMK FMT 2008 2010 TMK PF ET TMK TDS TMK CWB TMK PF Tubing 2008 2011 2012 TMK UP Magna 2013 TMK UP Centum 2017 Cal II Cal IV Cal II Cal IV Cal IV Cal IV 52 52#53TMK Utilisation of TMK Pipe Products in Oil and Gas Industry Tubing Sea platform Drill pipe Casing Oil field development Large diameter pipe Premium connections Oil settling tank Line pipe Petroleum refinery Oil storage Consumers ■ OCTG Oil Country Tubular Goods (drilling, casing, tubing) used for oil & gas exploration, well fixing and oil & gas production (47% of total sales in 9M 2018) Line pipe - used for short distance transportation of crude oil, oil products and natural gas (23% of total sales in 9M 2018) ■ LDP - large diameter pipe used for construction of trunk pipeline systems for long distance transportation of natural gas, crude oil and petroleum products (8% of total sales in 9M 2018) 53#54TMK Appendix - Other Materials 54#55TMK TMK's Undisputed Market Leading Position in Russia Seamless Welded Premium TMK 62% OCTG Line Pipe TMK Threaded pipes for O&G industry including drill 29% Short-distance TMK pipe, casing and tubing transportation of O&G and oil products 66% Line Pipe TMK 13% Large Diameter TMK Short-distance transport 57% of crude oil, oil products and natural gas Construction of trunk pipeline systems for long O&G and petroleum products distance transportation of Industrial TMK 8% TMK 37% Automotive, machine building, and power generation sectors Source: TMK estimates, based on 9M 2018 numbers Industrial Wide array of applications and industries, including utilities and agriculture 55 Premium Connections (TMK UP) Premium connections are proprietary value-added products used to connect OCTG pipes and are used in sour, deep well, off- shore, low temperature and other high-pressure applications #1 in the Russian Tube and Pipe Market TMK 23%#56TMK TMK Investor Relations 40/2a, Pokrovka Street, Moscow, 105062, Russia +7 (495) 775-7600 [email protected]