Investor Presentaiton

En+ GROUP STRATEGIC REPORT CHIEF EXECUTIVE OFFICER'S STATEMENT En+ Group Annual Report 2021 STRATEGIC REPORT CORPORATE GOVERNANCE FINANCIAL STATEMENTS APPENDICES The recent developments have created a wide range of uncertainty; the management is deeply concerned about everyone who has been impacted in this difficult situation. The management is reviewing all of the Company's activities to assess the possible impact of imposed restrictions on our business. It is our intention to continue our operations and support our employees in this volatile environment. Notwithstanding these challenges, I would like to report on the business performance in 2021 amid another year of global uncertainty from the continuing COVID-19 pandemic. En+ Group once again demonstrated the resilience of our people, our business model, and our strategy to deliver low-carbon aluminium to support a sustainable economy. Throughout this period, we continued to put the safety of our people first and were pleased to support the federal vaccination programme. By the end of the year, the collective immunity among our employees reached an impressive 94%. In addition to previously built medical centres, we went on supplying regional hospitals with modern medical vehicles and equipment. Thanks to solutions put in place in 2020 to mitigate the impact of the pandemic on our business, we were able to maintain uninterrupted operations throughout 2021. Critically, we maintained a world- class customer service to our aluminium customers around the globe. We also continued to upgrade our assets, delivered new innovations and set out an industry-leading decarbonisation strategy and ensured the supply of energy to homes across Siberia. OUR COMMITMENT TO THE HIGHEST STANDARDS OF CORPORATE GOVERNANCE AND SOCIAL RESPONSIBILITY SUPPORTS OUR STRATEGY." GG Vladimir Kiriukhin, Chief Executive Officer The year of stable operational performance Our aluminium production remained stable, and we increased sales of value-added products (VAPS) by 18.1% to 2,034 kt reaching 52% of total output (vs 44% in 2020). Our Power segment increased electricity output by 10.0% y-o-y and our HPP output increased by 12.1%, reflecting favourable hydrological conditions and progress on our capacity modernisation programme. We continued to benefit from the combination of our unique assets and operational excellence, and we maintained our leading position as the world's largest producer of low-carbon aluminium. Our fully vertically-integrated model helped us offset the inflationary pressures on raw materials prices seen across the world and we managed our cost base effectively. The Russian metal industry as a whole was impacted by the announcement at the end of June that the Russian government has approved a temporary export tax on ferrous and base metals, valid until 31 December 2021. Overall, our strong financial performance was supported by higher aluminium prices, which rose during the year driven by economic recovery from the early impacts of the COVID pandemic. 12.1% increase in our HPP output 18.1% increase in VAP sales Leading on decarbonisation We made important announcements in relation to our long-term strategy to lead the aluminium industry into the low-carbon economy. In January, we announced the most ambitious decarbonisation targets our industry has ever seen, and in September we disclosed the detailed roadmap of initiatives that will enable our Group to reduce its greenhouse gas emissions by at least 35% by 2030, and to be net zero by 2050 (Scope 1 and 2 as benchmarked against the Group's 2018 GHG emissions). Our Pathway to Net zero includes emissions abatement, avoided emissions solutions, and compensation and neutralisation. In our Metals segment, this will involve initiatives such as optimising our raw materials supplying system, implementing Eco-Søderberg technology at our plants, converting smelters to pre-baked anode technology, and launching large-scale production of our ground-breaking inert anode technology. In the future, we will also look to improve our energy efficiency in alumina refineries and capitalise on the greater availability of green hydrogen. We will also increase the amount of recycled aluminium we use. In our Power segment, we will increase renewable power generation by the development and construction of new renewable power and heat generation: hydropower, biofuels and hydrogen production and by the implementation of the New Energy programme. Continuous improvement and innovation In 2021, we continued to make progress on the Group's New Energy Programme, which will enable us to achieve industry-leading efficiency metrics at our hydropower stations while contributing to our emissions reduction. Upgraded equipment at the Group's Bratsk, Ust-Ilimsk, Irkutsk and Krasnoyarsk HPPs supported an increase in hydropower production during the year. Last year we replaced one runner at one of the Bratsk Hydropower Station's hydraulic units. This is one of 18 hydro-turbine runners, which have been undergoing a three-stage modernisation programme. The Company also launched a new the second in a row hydroelectric unit at the Irkutsk HPP. So far, increased efficiency will be provided by the new runners, with an efficiency rate increase of up to 8% depending on the runner. In 2021, the Group'shydropower stations generated an additional 2.1 billion kWh of energy from the same volume of water, helping to prevent greenhouse gas emissions by approximately 2.4 kt of CO2e. The ongoing modernisation of our HPPs' equipment will increase their efficiency, reduce the cost of repair work, and improve the performance of the units and stations in general. As we expand hydropower production, we have been pleased to support the development of Russia's renewable energy certificate market. In 2021, we announced Russia's largest-ever supply deal for I-RECS, issuing over one million certificates corresponding to the electric energy produced by En+ Group companies such as JSC EuroSibEnergo (Krasnoyarsk HPP) and LLC Abakan SPP (Abakansk Solar Plant). I-RECS certificates adhere to major international sustainability and carbon accountability standards including the GHGP, CDP and RE100. Energy consumers can use renewable energy certificates to meet their carbon targets within 'scope 2', and to support their internal corporate social responsibility policies. We were delighted in 2021 to receive confirmation from UN Energy that the Group's commitments to expanding clean energy generation and access have been officially recognised within the Energy Compact. In our Metals segment we continued to focus on further reducing the carbon footprint of our aluminium products through the upgrading of equipment and developing new technology, and on expanding consumer markets for our low-carbon aluminium brand, ALLOW. We are constantly innovating to reduce the carbon footprint of our aluminium further, and in April 2021, we announced that our Metals segment had produced the lowest carbon aluminium ever seen, with a carbon footprint of less than 0.01 tonnes of CO2 equivalent per tonne of metal (Scope 1, Scope 2 - direct and indirect energy emissions). 22 23