KAZ MINERALS PLC HALF-YEARLY REPORT FOR THE PERIOD ENDED 3O JUNE 2020

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FINANCIAL HIGHLIGHTS

• Revenues of $991 million (H1 2019: $1,052 million) as 11% lower average LME copper price was partially offset by 2% increase in copper sales volumes and 16% higher gold revenues
• Copper sales of 146.9 kt (H1 2019: 144.4 kt) and gold sales of 98.6 koz (H1 2019: 108.0 koz), lower than production due to timing of shipments
• EBITDA¹ of $559 million, representing a 56% margin (H1 2019: $620 million, 59% margin)
• Operating profit of $357 million (H1 2019: $410 million)
• Strong cash generation, with net cash flows from operating activities of $310 million (H1 2019: $236 million)
• First quartile net cash cost¹ of 68 USc/lb (H1 2019: 80 USc/lb), supported by increased copper sales volumes, strong gold by-product credits and weaker tenge exchange rate during the period
• Gross cash cost¹ guidance lowered by 10 USc/lb for both Bozshakol (120-140 USc/lb) and East Region and Bozymchak (250-270 USc/lb)

OPERATIONAL HIGHLIGHTS

• No material disruption to output or sales from Covid-19 in the year to date
• Copper production² increased by 4% to 153.8 kt (H1 2019: 147.6 kt) driven by high ore throughput and improved grades at Bozshakol
• Gold production³ increased by 25% to 109.7 koz (H1 2019: 87.7 koz), also due to higher processing volumes and grades at Bozshakol
• Covid-19 risks remain in the second half but all metals currently on track to achieve full year production guidance

COVID-19 RESPONSE

• Ensuring the safety, health and wellbeing of employees and contractors is the Group’s first priority
• Comprehensive measures have been taken to protect staff and operations including restricted access, testing and isolation, re-organisation of shifts and increased stocking of critical spares and consumables
• Support has been provided to vulnerable local communities
• Additional Covid-19 related costs of $15 million incurred to sustain operations in the first half

FINANCIAL POSITION AND DIVIDEND

• Net debt¹ increased by $38 million to $2,797 million at 30 June 2020 (31 December 2019: $2,759 million)
• Gross liquid funds¹ of $1,101 million at 30 June 2020 (31 December 2019: $541 million)
• Borrowings of $3,898 million at 30 June 2020 (31 December 2019: $3,300 million)
• $200 million remains undrawn of the DBK-Aktogay II facility to fund investment in the Aktogay expansion project and $26 million remains to be drawn under the CAT facility
• Interim dividend of 4.0 US cents per share declared (H1 2019: 4.0 US cents per share)

GROWTH PROJECTS

• Aktogay expansion project on track for late 2021 startup
• Capital expenditure of $149 million in first half, full year guidance now set at around $300 million
• $1.2 billion project budget unchanged
• Baimskaya copper project Bankable Feasibility Study expected to be completed by end of 2020
• Capital expenditure of $74 million in first half, full year guidance increased by $40 million to $190 million to progress detailed engineering

OUTLOOK

• Covid-19 risks remain but full year production guidance maintained after strong performance in first half
• Copper price has recently risen due to increased demand combined with supply disruption, long term outlook is positive due to lack of new projects to replace declining output
• Consistent operational performance provides platform to deliver the Group’s growth pipeline

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 APMs section on page 51.

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

3 Payable metal in concentrate.

Andrew Southam, Chief Executive Officer, said: “Despite challenging conditions for all miners in the first half of 2020 as a result of Covid-19, KAZ Minerals recorded EBITDA of $559 million and grew net cash flow from operations by 31% to $310 million. Thanks to the dedication and hard work of our employees we have increased copper and gold production and maintained our low cost position, recording a net cash cost of 68 USc/lb. Covid-19 risks remain, but the Group is on track to achieve its full year production guidance after an excellent performance in the first half.”

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