Investor Presentaiton

En+ GROUP FINANCIAL STATEMENTS EN+ GROUP IPJSC Notes to the Consolidated Financial Statements for the year ended 31 December 2021 En+ Group Annual Report 2021 EN+ GROUP IPJSC Notes to the Consolidated Financial Statements for the year ended 31 December 2021 (g) Master netting or similar agreements The Group may enter into sales and purchase agreements with the same counterparty in the normal course of business. The related amounts receivable and payable do not always meet the criteria for offsetting in the statement of financial position. The following table sets out the carrying amounts of recognised financial instruments that are subject to the above agreements. (d) Social commitments The Group contributes to the maintenance and upkeep of the local infrastructure and the welfare of its employees, including contributions toward the development and maintenance of housing, hospitals, transport services, recreation and other social needs of the regions of the Russian Federation where the Group's production entities are located. The funding of such assistance is periodically determined by management and is appropriately capitalised or expensed as incurred. STRATEGIC REPORT CORPORATE GOVERNANCE FINANCIAL STATEMENTS Appendices Gross amounts Net amounts presented in the statement of financial position Amounts related to recognised financial instruments that do not meet some or all of the offsetting criteria Net amount Gross amounts Net amounts presented in the statement of financial position Amounts related to recognised financial instruments that do not meet some or all of the offsetting criteria Net amount Commitments 21. (a) Capital commitments (b) (c) Year ended 31 December 2021 USD million 22. Contingencies USD million Trade receivables Trade payables (a) Taxation 114 (90) 114 (90) (36) 78 Year ended 31 December 2020 USD million Trade receivables 36 (54) USD million Trade payables 71 71 (61) (61) (23) 23 48 (38) The Group had outstanding capital commitments which had been contracted for at 31 December 2021 and 31 December 2020 in the amount of USD 655 million and USD 813 million, including VAT, respectively. These commitments are due over a number of years. Purchase commitments Commitments with third parties for purchases of alumina, bauxite, other raw materials and other purchases in 2022-2034 under supply agreements are estimated from USD 2,517 million to USD 4,534 million at 31 December 2021 (31 December 2020: USD 3,256 million to USD 4,644) depending on the actual purchase volumes and applicable prices. Commitments with related parties for purchases of primary aluminium, alloys and other purchases in 2022-2030 under supply agreements are estimated from USD 5,733 million to USD 7,540 million at 31 December 2021 (31 December 2020: USD 4,741 million to USD 6,964 million) depending on the actual purchase volumes and applicable prices. Sale commitments Commitments with third parties for sales of alumina and other raw materials in 2022-2034 are estimated from USD 1,187 million to USD 1,596 million at 31 December 2021 (31 December 2020: from USD 865 million to USD 1,375 million) and will be settled at market prices at the date of delivery. There are no commitments with related parties for sales of alumina as at 31 December 2021 and 31 December 2020. Commitments with related parties for sales of primary aluminium and alloys in 2022 are estimated from USD 337 million to USD 412 million at 31 December 2021 (31 December 2020: from USD 224 million to USD 269 million). Commitments with third parties for sales of primary aluminium and alloys in 2022-2025 are estimated to range from USD 8,842 million to USD 12,148 million at 31 December 2021 (31 December 2020: from USD 1,738 million to USD 11,602 million). (b) Russian tax, currency and customs legislation is subject to varying interpretations, and changes, which can occur frequently. Management's interpretation of such legislation as applied to the transactions and activities of the Group may be challenged by the relevant local, regional and federal authorities. Notably recent developments in the Russian environment suggest that the authorities in this country are becoming more active in seeking to enforce, through the Russian court system, interpretations of the tax legislation, in particular in relation to the use of certain commercial trading structures, which may be selective for particular tax payers and different from the authorities' previous interpretations or practices. Recent events within the Russian Federation suggest that the tax authorities are taking a more assertive and substance-based position in their interpretation and enforcement of tax legislation. The Russian taxation system is continually evolving and is subject to frequent changes, starting from 1 January 2015, changes aimed at regulating tax consequences of transactions with foreign companies and their activities were introduced, such as the concept of beneficial ownership of income, taxation of controlled foreign companies, tax residency rules, country-by-country reporting etc. This legislation and practice of its application is still evolving and the impact of legislative changes should be considered based on the actual circumstances. All these circumstances may create tax risks in the Russian Federation that are substantially more significant than in other countries. Management believes that it has provided adequately for tax liabilities based on its interpretations of applicable Russian tax legislation, official pronouncements and court decisions. However, the interpretations of the tax authorities and courts, especially due to reform of the supreme courts that are resolving tax disputes, could differ and the effect on these consolidated financial statements, if the authorities were successful in enforcing their interpretations, could be significant. In addition to the amounts of income tax the Group has provided, there are certain tax positions taken by the Group where it is reasonably possible (though less than 50% likely) that additional tax may be payable upon examination by the tax authorities or in connection with ongoing disputes with tax authorities. The Group's best estimate of the aggregate maximum of additional amounts that it is reasonably possible may become payable if these tax positions were not sustained at 31 December 2021 is USD 26 million (31 December 2020: USD 36 million). Environmental contingencies The Group and its predecessor entities have operated in the Russian Federation, Ukraine, Jamaica, Guyana, the Republic of Guinea and the European Union for many years and certain environmental problems have developed. Governmental authorities are continually considering environmental regulations and their enforcement and the Group periodically evaluates its obligations related thereto. As obligations are determined, they are recognised immediately. The outcome of environmental liabilities under proposed or any future legislation, or as a result of stricter enforcement of existing legislation, cannot reasonably be estimated. Under current levels of enforcement of existing legislation, management believes there are no possible liabilities, which will have a material adverse effect on the financial position or the operating results of the Group. However, the Group anticipates undertaking significant capital projects to improve its future environmental performance. 206 207