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FINANCIAL HIGHLIGHTS

• Revenues increased by 5% to $2,266 million (2018: $2,162 million) as higher production and sales offset lower copper prices
  • Full year copper sales volumes of 317 kt (2018: 296 kt) and gold sales of 225 koz (2018: 169 koz)
  • Average LME copper price in 2019 reduced by 8% to $6,000/t (2018: $6,526/t)
• EBITDA¹ of $1,355 million at an EBITDA margin of 60% (2018: $1,310 million)
  • Operating profit increased by 8% to $923 million (2018: $851 million)
• Industry leading net cash cost¹ of 77 USc/lb (2018: 85 USc/lb)
  • Gross cash costs¹ reduced to 140 USc/lb (2018: 144 USc/lb) driven by increased contribution from Aktogay and cost efficiencies at the East Region
  • Gold by-product revenues rose by 50% to $318 million (2018: $212 million) driven by 10% increase in production, 10% higher average LBMA gold price and the sale of inventory
  • Structural factors of economies of scale, competitive energy and transport costs, and low strip ratios continue to support the Group’s low cost position
• Net debt¹ $2,759 million (2018: $1,986 million)
  • 2019 investments include $436 million cash consideration for the Baimskaya acquisition and $718 million of expansionary capital expenditure (2018: $530 million)
  • Gross liquid funds¹ of $541 million at 31 December 2019 (2018: $1,467 million)
  • $1.0 billion of committed facilities undrawn as at 28 January 2020, following amendment of PXF
• Final dividend of 8 US cents per ordinary share recommended
  • Total 2019 dividend of 12 US cents per ordinary share, including the interim dividend of 4 US cents per ordinary share paid on 25 October 2019

OPERATIONAL HIGHLIGHTS

• Copper production² of 311 kt and gold production³ of 201 koz (+6% and +10% compared with 2018)
  • 2020 copper production² guided at 280-300 kt as grades are expected to decline at Aktogay while East Region output is limited by low grades and challenging geological conditions

POSITIONED FOR GROWTH

• Strong performance from producing assets supports investment in near and long term growth
  • Aktogay expansion on track for completion in 2021, $1.2 billion project budget unchanged
  • Baimskaya feasibility study ongoing, expected to be completed later in the first half of 2020

1  Alternative Performance Measures (“APMs”) are used to assess the performance of the Group and are not defined or specified under IFRS. For further information on APMs, including justification for their use, please refer to the APMs section on page 54.

2  Payable metal in concentrate and copper cathode from Aktogay oxide ore.

3  Payable metal in concentrate.

Andrew Southam, Chief Executive Officer, said: “In 2019 KAZ Minerals has continued to build on its operational track record, delivering further growth in copper production and maintaining its industry leading cost position. Our large scale operations in Kazakhstan achieved record levels of production and our proven, low cost asset base provides a strong platform for investment into value-accretive growth projects. The Aktogay expansion project is on budget and on track to commence production in 2021. We look forward to releasing further details of our plans for Baimskaya when the bankable feasibility study is completed.”

For further information please contact:

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NOTES TO EDITORS

KAZ Minerals PLC (“KAZ Minerals” or “the Group”) is a high growth copper company focused on large scale, low cost, open pit mining in Kazakhstan, Russia and Kyrgyzstan. It operates the Aktogay and Bozshakol open pit copper mines in the East Region and Pavlodar region of Kazakhstan, three underground mines and associated concentrators in the East Region of Kazakhstan and the Bozymchak copper-gold mine in Kyrgyzstan. In 2019, total copper production was 311 kt with by-products of 201 koz of gold, 3,382 koz of silver and 38 kt of zinc in concentrate. The Group acquired the Baimskaya project in the Chukotka region of Russia in January 2019, one of the world’s most significant undeveloped copper assets, with the potential to become a large scale, low cost, open pit copper mine.

The Group’s new operations at Aktogay and Bozshakol have delivered industry leading production growth and transformed KAZ Minerals into a company dominated by world class, open pit copper mines.

Aktogay is a large scale, open pit mine similar to Bozshakol, with a remaining mine life of around 25 years (including the expansion project) at an average copper grade of 0.35% (oxide) and 0.33% (sulphide). Aktogay commenced production of copper cathode from oxide ore in December 2015 and copper in concentrate from sulphide ore in February 2017. The operating sulphide concentrator has an annual ore processing capacity of 25 million tonnes and the sulphide processing capacity will be doubled to 50 million tonnes with the addition of a second concentrator by the end of 2021. Aktogay is competitively positioned on the global cost curve and will produce an average of 100 kt of copper per year from sulphide ore until 2021, increasing to 170 kt per year from 2022 to 2027, after the second concentrator commences operations. Copper production from oxide ore will be in the region of 20 kt per annum until 2024.

Bozshakol is a first quartile asset on the global cost curve with an annual ore processing capacity of 30 million tonnes and a remaining mine life of c.40 years at an average copper grade of 0.36%. The mine and processing facilities commenced output in 2016 and will produce an average of 100 kt of copper cathode equivalent and 120 koz of gold in concentrate per year over the first 10 years of operations.

The Peschanka deposit within the Baimskaya licence area in Russia has JORC resources of 9.5 Mt of copper at an average grade of 0.43% and 16.5 Moz of gold at an average grade of 0.23 g/t. Average annual production over the first ten years of operations is expected to be 250 kt copper and 400 koz gold, or 330 kt Copper Equivalent Production, with a mine life of approximately 25 years and first quartile operating costs. The project is located in a region identified by the Russian Government as strategically important for economic development and will benefit from the construction of state-funded power and transport infrastructure and the provision of tax incentives. The estimated capital budget for construction is $5.5 billion. The parameters of the project will be confirmed on completion of the feasibility study. The Group expects the project to generate a significant NPV uplift and an attractive IRR at analyst consensus copper prices. The development of Baimskaya will enable the Group to continue its high growth trajectory, adding a large scale, long life asset to the Group’s portfolio.

KAZ Minerals is listed on the London Stock Exchange and the Kazakhstan Stock Exchange and employs around 16,000 people, principally in Kazakhstan.

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KAZ Minerals PLC (“KAZ Minerals” or “the Group”) announces that it has completed an amendment and extension of its pre-export finance loan facility which includes an increase in facility commitments to $1.0 billion, an extension of the loan tenor and a reduction in the margin pricing (the “New PXF”).

The increase of the facility amount to $1.0 billion reflects strong support from the market and the New PXF was significantly over subscribed during syndication. The New PXF represents a net increase of $700 million above the $300 million outstanding under the existing facility and the Group expects to fully draw the facility by the end of February 2020.

The New PXF incorporates a number of other enhancements compared with the previous facility, including:

       i.    an extension to the maturity profile by 3.5 years, from June 2021 until December 2024;

       ii.    two annual extension options, exercisable on the first and second anniversary dates of signing, which, if exercised, would extend final maturity of the facility to December 2025 or December 2026 respectively (the “Extension Options”);

       iii.   a revised repayment profile with monthly principal repayments commencing in January 2021 and continuing over a four-year period until December 2024, or over a six-year period to December 2026 if the Extension Options are exercised;

       iv.    a balloon repayment of one-third of the facility amount ($333 million) if final maturity occurs in December 2024, or to be amortised during 2025 and 2026 if the Extension Options are exercised;

        v.     a reduced interest margin set initially at 2.50% above US dollar LIBOR (previously set at 3.00% under the existing PXF facility). The margin is variable during the life of the facility ranging between 2.25% and 3.50% above US dollar LIBOR, depending on the ratio of net debt to EBITDA, to be tested semi-annually; and

       vi.    increased headroom under financial covenants.

The bank syndicate has increased from 12 to 19 lenders.  The Mandated Lead Arrangers are Deutsche Bank AG, ING Bank NV, Société Générale, ABN AMRO Bank NV, Bank of China Limited, Crédit Agricole Corporate and Investment Bank, Credit Suisse AG, ICBC London, Natixis and PJSC «SOVCOMBANK». Other lenders in the facility are Bank of Montreal, DZ Bank AG, Intesa SanPaolo S.P.A., Mizuho Bank, Sumitomo Mitsui Banking Corporation, HSBC Bank PLC, KFW Ipex-Bank GMBH, Raiffeisen Bank International AG and Citibank N.A.

Deutsche Bank AG continues as the facility agent and ING Bank is the security trustee.

John Hadfield, Chief Financial Officer, said: “The signing of this facility provides additional financial flexibility for the Group and demonstrates ongoing support from our lenders. We are pleased to have expanded the banking group and improved the terms of the facility.”

For further information please contact:

Notes to editors

KAZ Minerals PLC (“KAZ Minerals” or “the Group”) is a high growth copper company focused on large scale, low cost, open pit mining in Kazakhstan, Russia and Kyrgyzstan. It operates the Bozshakol and Aktogay open pit copper mine in the Pavlodar and East Region of Kazakhstan, three underground mines and associated concentrators in the East Region of Kazakhstan and the Bozymchak copper-gold mine in Kyrgyzstan. In 2018, total copper production was 295 kt with by-products of 50 kt of zinc in concentrate, 183 koz of gold and 3,511 koz of silver. In January 2019, the Group acquired the Baimskaya project in the Chukotka region of Russia, one of the world’s most significant undeveloped copper assets with the potential to become a large scale, low cost, open pit copper mine.

The Group’s new operations at Bozshakol and Aktogay have delivered industry leading production growth and transformed KAZ Minerals into a company dominated by world class, open pit copper mines.

Bozshakol is a first quartile asset on the global cost curve with an annual ore processing capacity of 30 million tonnes and a remaining mine life of c.40 years at an average copper grade of 0.37%. The mine and processing facilities commenced output in 2016 and will produce an average of 100 kt of copper cathode equivalent and 120 koz of gold in concentrate per year over the first 10 years of operations.

Aktogay is a large scale, open pit mine similar to Bozshakol, with a remaining mine life of around 25 years (including the expansion project) at an average copper grade of 0.36% (oxide) and 0.33% (sulphide). Aktogay commenced production of copper cathode from oxide ore in December 2015 and copper in concentrate from sulphide ore in February 2017. The operating sulphide concentrator has an annual ore processing capacity of 25 million tonnes and the sulphide processing capacity will be doubled to 50 million tonnes with the addition of a second concentrator by the end of 2021. Aktogay is competitively positioned on the global cost curve and will produce an average of 100 kt of copper per year from sulphide ore until 2021, increasing to 170 kt per year from 2022 to 2027, after the second concentrator commences operations. Copper production from oxide ore will be in the region of 20 kt per annum until 2024.

The Peschanka deposit within the Baimskaya licence area in Russia has JORC resources of 9.5 Mt of copper at an average grade of 0.43% and 16.5 Moz of gold at an average grade of 0.23 g/t. Average annual production over the first ten years of operations is expected to be 250 kt copper and 400 koz gold, or 330 kt Copper Equivalent Production, with a mine life of approximately 25 years and first quartile operating costs. The project is located in a region identified by the Russian Government as strategically important for economic development and will benefit from the construction of state-funded power and transport infrastructure and the provision of tax incentives. The estimated capital budget for construction is $5.5 billion and the project is currently at feasibility study stage. The Group expects the project to generate a significant NPV uplift and an attractive IRR at analyst consensus copper prices. The development of Baimskaya will enable the Group to continue its high growth trajectory, adding a large scale, long life asset to the Group’s portfolio.

KAZ Minerals is listed on the London Stock Exchange and the Kazakhstan Stock Exchange and employs around 15,000 people, principally in Kazakhstan.

This announcement contains inside information.

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NEW $100 MILLION CREDIT FACILITY

KAZ Minerals PLC (“KAZ Minerals” or “the Group”) announces the signing of a new term loan credit facility of up to $100 million (“Credit Facility”) with Caterpillar Financial Services (UK) Limited, a subsidiary of Caterpillar Financial Services Corporation (“Cat Financial”) and Caterpillar Inc. (“Caterpillar”). Caterpillar is a major supplier of mining equipment to the Group’s Bozshakol and Aktogay mines in Kazakhstan.

The interest margin and financial covenants on the Credit Facility are comparable with the Group’s existing pre-export finance facility. The Credit Facility is comprised of two sub-facilities of $40 million and $60 million secured against existing and new Caterpillar equipment, which will be drawn between December 2019 and March 2021. Quarterly repayments for both sub-facilities will commence in December 2020, with final maturities in December 2023 and March 2026.

John Hadfield, Chief Financial Officer, said “This new credit facility with Caterpillar provides additional liquidity and broadens our debt portfolio as we progress the construction of the Aktogay expansion project in Kazakhstan, which is due to commence production in 2021.”

For further information please contact:

Notes to editors

KAZ Minerals PLC (“KAZ Minerals” or “the Group”) is a high growth copper company focused on large scale, low cost, open pit mining in Kazakhstan, Russia and Kyrgyzstan. It operates the Bozshakol and Aktogay open pit copper mines in the Pavlodar and East Region of Kazakhstan, three underground mines and associated concentrators in the East Region of Kazakhstan and the Bozymchak copper-gold mine in Kyrgyzstan. In 2018, total copper production was 295 kt with by-products of 50 kt of zinc in concentrate, 183 koz of gold and 3,511 koz of silver. In January 2019, the Group acquired the Baimskaya project in the Chukotka region of Russia, one of the world’s most significant undeveloped copper assets with the potential to become a large scale, low cost, open pit copper mine.

The Group’s new operations at Bozshakol and Aktogay have delivered industry leading production growth and transformed KAZ Minerals into a company dominated by world class, open pit copper mines.

Bozshakol is a first quartile asset on the global cost curve with an annual ore processing capacity of 30 million tonnes and a remaining mine life of 38 years at an average copper grade of 0.37%. The mine and processing facilities commenced output in 2016 and will produce an average of 100 kt of copper cathode equivalent and 120 koz of gold in concentrate per year over the first 10 years of operations.

Aktogay is a large scale, open pit mine similar to Bozshakol, with a remaining mine life of 27 years (including the expansion project) at an average copper grade of 0.36% (oxide) and 0.33% (sulphide). Aktogay commenced production of copper cathode from oxide ore in December 2015 and copper in concentrate from sulphide ore in February 2017. The operating sulphide concentrator has an annual ore processing capacity of 25 million tonnes and the sulphide processing capacity will be doubled to 50 million tonnes with the addition of a second concentrator by the end of 2021. Aktogay is competitively positioned on the global cost curve and will produce an average of 100 kt of copper per year from sulphide ore until 2021, increasing to 170 kt per year from 2022 to 2027, after the second concentrator commences operations. Copper production from oxide ore will be in the region of 20 kt per annum until 2024.

The Peschanka deposit within the Baimskaya licence area in Russia has JORC resources of 9.5 Mt of copper at an average grade of 0.43% and 16.5 Moz of gold at an average grade of 0.23 g/t. Average annual production over the first ten years of operations is expected to be 250 kt copper and 400 koz gold, or 330 kt Copper Equivalent Production, with a mine life of approximately 25 years and first quartile operating costs. The project is located in a region identified by the Russian Government as strategically important for economic development and will benefit from the construction of state-funded power and transport infrastructure and the provision of tax incentives. The estimated capital budget for construction is $5.5 billion and the project is currently at feasibility study stage. The Group expects the project to generate a significant NPV uplift and an attractive IRR at analyst consensus copper prices. The development of Baimskaya will enable the Group to continue its high growth trajectory, adding a large-scale, long-life asset to the Group’s portfolio.

KAZ Minerals is listed on the London Stock Exchange and the Kazakhstan Stock Exchange and employs around 15,000 people, principally in Kazakhstan.

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This announcement contains inside information.

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