1
MMK INTEGRATED
ANNUAL REPORT
2021
Preliminary approved
by the Board of Directors of MMK
Minutes as of 25.04.2022 No. 14
Approved by the Annual General
Meeting of Shareholders of MMK
Minutes as of ________ No. __

MMK INTEGRATED ANNUAL REPORT
2
TABLE OF CONTENT
2021 HIGHLIGHTS ......................................................................................................... 3
ABOUT THIS REPORT ....................................................................................................... 3
AT A GLANCE ................................................................................................................... 7
OUR INVESTMENT CASE .................................................................................................. 9
BUSINESS MODEL.......................................................................................................... 10
CHAIRMAN’S STATEMENT .............................................................................................. 12
CEO’S STATEMENT ......................................................................................................... 14
HOW WE MAKE STRATEGIC DECISIONS ........................................................................ 17
FOCUS AREAS FOR THE BOARD IN 2021 ........................................................................ 19
STRATEGIC FRAMEWORK .............................................................................................. 20
STRATEGY ..................................................................................................................... 22
KEY PERFORMANCE INDICATORS .................................................................................. 24
MARKET TRENDS ........................................................................................................... 28
STAKEHOLDER ENGAGEMENT ........................................................................................ 30
FINANCIAL CAPITAL ..................................................................................................... 35
MANUFACTURED CAPITAL ............................................................................................. 43
INTELLECTUAL CAPITAL ................................................................................................ 57
NATURAL CAPITAL ........................................................................................................ 63
HUMAN CAPITAL ........................................................................................................... 71
SOCIAL AND RELATIONSHIP CAPITAL........................................................................... 80
RISK MANAGEMENT....................................................................................................... 92
GOVERNANCE .............................................................................................................. 101
INFORMATION FOR INVESTORS .................................................................................. 128
RESPONSIBILITY STATEMENT ..................................................................................... 136
COMPLIANCE OF THE REPORT WITH THE INTERNATIONAL INTEGRATED REPORTING
FRAMEWORK ............................................................................................................... 137
BSI VERIFICATION OPINION ...................................................................................... 138
CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021 139
GLOSSARY ................................................................................................................... 199
CONTACTS ................................................................................................................... 202

MMK INTEGRATED ANNUAL REPORT
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2021 HIGHLIGHTS
FINANCIAL
OPERATIONAL
SUSTAINABILITY
GROUP REVENUE
GROUP STEEL OUTPUT
LTIFR
$11,869m
13.6mt
0.62
2020: $6,395m
2020: 11.6mt
2020: 0.66
EBITDA
GROUP SALES OF METAL PRODUCTS
LTISR
$4,290m
12.5mt
23.20
2020: $1,492m
2020: 10.8mt
2020: 23.66
1
FREE CASH FLOW
SHARE OF PREMIUM PRODUCTS IN GROUP
SALES
GHG INTENSITY
$1,613m
41.8%
1.95t CO
2
e / t of crude
steel
2020: $557m
2020: 47.8%
2020: 2.18t CO
2
e / t of crude
steel
ABOUT THIS REPORT
This is the second Integrated Report of Magnitogorsk Iron & Steel Works (MMK). Our Integrated
Report provides quantitative and qualitative disclosures on our relationships with stakeholders and
how our leadership, culture and strategy are aligned to deliver value while managing risks and changes
to the external environment. Our Report continues to evolve towards enhanced disclosures to meet
the requirements of our investors and other stakeholders.
Our purpose
We aim to produce and deliver premium quality steel products in a way that generates value
for stakeholders, improves the quality of life of our employees and the people whose communities are
affected by our operations and allows our customers, and the world, to benefit from the power and
strength of steel.
OUR INTEGRATED THINKING
1
At the end of 2021, a methodology for calculating injury rates was introduced. The calculation was made for accidents registered
on the territory of the MMK Group's industrial site, taking into account third-party organisations.

MMK INTEGRATED ANNUAL REPORT
4
IDENTIFYING MATERIAL TOPICS
Step 1. Identification
- Benchmarking material aspects highlighted in the reports of international and Russian steel
companies
- Analysing information requests from external stakeholders and ESG rating agencies
- Analysing open sources of information (industry trends and risks, research, media reports)
Drawing up a preliminary list of material topics
Step 2. Prioritisation
- Approving the list of material topics
- Electronic survey of internal and external stakeholders
- Prioritising the list of material topics based on the survey results
Prioritising the list of material topics
Step 3. Approval
- Building a materiality matrix
- Drafting and approving the concept and structure of the Report, taking into account the
prioritisation results
Building a materiality matrix and a concept of the Report
VALUE CREATION, PRESERVATION AND EROSION
Value creation, preservation and erosion are the consequences of how we apply and leverage
our capitals as part of our strategy execution and are evident in how these capitals change over time,
our financial performance and the outputs and outcomes for all stakeholders.
There are six capitals, which participate in the value creation process: financial, manufactured,
intellectual, natural, human, social and relationship capital. Our value creation and preservation
processes are embedded in our purpose (page 19), described as part of our business model on
page 10, and integrated into the way we think and make strategic decisions (pages 16-17).
In our Report, we use the icons below to denote value creation, preservation and erosion:
OUR INTEGRATED REPORTING PROCESS
↑ Value creation
→ Value preservation
↓ Value erosion

MMK INTEGRATED ANNUAL REPORT
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The 2021 Integrated Annual Report is prepared on the basis of such materials as Management
Board minutes, Board decisions and approvals as well as internal and external reporting information
as required by the Integrated <IR> Framework (2021). A cross functional team, led by a member of
the Management Board, Head of financial resources, and represented by various departments of MMK
and subject matter experts across the MMK Group, produces several drafts of the Integrated Report
with oversight from Board Strategic planning committee and the Board. The Strategic planning
committee members review and contribute to the content of the drafts and provide recommendations
for the Board ahead of its review. The Board provides preliminary approval of the Integrated Annual
Report and submits to Annual General Meeting of Shareholders (AGM) for the final approval.
Our approach to integrated reporting
The 2021 Integrated Annual Report discloses data on MMK’s financial, economic and operating
activities, and reflects the sustainability highlights of MMK and its subsidiaries from 1 January to 31
December 2021.
Operational and financial results were presented in the Report in accordance with the IFRS
consolidated financial statements of PJSC MMK (the MMK Group’s parent company) and the Group’s
Russian and foreign subsidiaries.
In the reporting year, the boundaries of non-financial information were comparable to last year's
disclosure levels for all areas of the MMK Group's sustainable development to bring the perimeter of
the Group's financial and non-financial reporting closer together. More detailed disclosure boundaries
for quantitative information in the area of sustainable development by main thematic content blocks
will be presented in the 2021 Sustainability Report, which will be published in May 2022.
Reporting principles we adhere to
The overall approach to reporting focused on value creation is guided by the Integrated
Reporting framework (<IR>), WorldSteel recommendations, Russian corporate governance code and
UK corporate governance code.
Financial statements disclosure is performed in line with International Financial Reporting
Standards (IFRS).
The process of determining materiality and disclosing sustainability information is carried out in
accordance with the recommendations of GRI, SASB, the Central Bank of Russia, and UN CSD
standards. More detailed disclosures on non-financial reporting, information on the basis for non-
financial reporting, guidelines and the perimeter of assurance on sustainability information can be
found in our 2021 Sustainability Report, which will be published in May 2022.
Integrity and assurance of the Report
The Board ensures the integrity of the Integrated Report through our integrated reporting
process, the various approvals and sign-offs by Management Board and the Strategic planning
committee.
Our annual financial statements are assured by our external auditors PricewaterhouseCoopers.
MMK’s GHG emissions for 2020 and 2021 (Scope 1, 2,3) were verified by BSI, a global
certification company.
We did not engage an independent practitioner to provide limited assurance on this 2021
Integrated Annual Report. Thus, some values of non-financial indicators presented in the Report may
subsequently differ from the values presented in the 2021 Sustainability Report, since independent
experts will be engaged to confirm the correctness of the indicators presented in the Sustainability
Report.

MMK INTEGRATED ANNUAL REPORT
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The sustainability information verification can be found in our 2021 Sustainability Report which
will be published on May 2022.
The 2021 reporting suite
- 2021 Integrated Annual Report
- Appendices to the 2021 Integrated Annual Report
- 2021 Sustainability Report - to be published in May 2022
- GRI Index for 2021 - to be published in May 2022
- SASB Index for 2021 - to be published in May 2022
Preliminary approval by the Board of Directors
The Board acknowledges its responsibility of ensuring the integrity of this Integrated Report. In
the Board’s opinion, this Report addresses all the issues that are material to the Group’s ability to
create value and fairly presents the integrated performance of MMK. The Board is confident that the
Report was prepared in accordance with the International <IR> Framework (2021). This Report was
preliminary approved by the Board of Directors of MMK on April 25 2022 (minutes as of 25.04.2022
№14).
CEO Shilyaev P.V.
Director of LLC MMK- Accounting Center Samoylova O.Y.

MMK INTEGRATED ANNUAL REPORT
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AT A GLANCE
Our operations encompass the entire steel production chain and we specialise in premium steel
products. We have a high-quality asset base with the position in the 1st quartile on the global cost
curve. MMK shares are traded on MOEX (Moscow Stock Exchange) and GDRs are traded on the LSE
(London Stock Exchange).
WE ARE A LEADING RUSSIAN METALS COMPANY
№ 1
16.9%
MMK GROUP’S RUSSIAN MARKET
SHARE
$11,869m
MMK GROUP’S TOTAL REVENUE
 Steel supplier in the Russian market
 Producer of premium products in Russia
 Steel supplier for the automotive industry in Russia
 Supplier of galvanised and polymer coated steel in Russia
WE OPERATE ACROSS THREE BUSINESS SEGMENTS, IN RUSSIA AND TURKEY
Steel segment Russia focusing on the Russian and FSU market.
Steel segment Turkey meeting demands of the Middle East, European and Asian markets.
Coal mining segment meeting the internal needs of the steelmaking business.
Coking coal concentrate produced from our Kemerovo mines is used in Magnitogorsk for the
production of coke used in steelmaking.
16.9%
12.7%
10.0%
4.9%
55.5%
Market share by company in Russia
ММК
Peer A
Peer B
Peer C
Other
89.7%
10.0%
0.3%
Revenue by segment
Steel segment Russia
Steel segment Turkey
Coal mining segment

MMK INTEGRATED ANNUAL REPORT
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WE INTEGRATE SUSTAINABILITY IN OUR STRATEGY AND OPERATIONS
LTIFR
t CO
2
e / t of crude steel
the Group’s investments in
local development and
philanthropy
2
0.62
1.95
$16.3m
Core SDGs:
Read about our purpose, values and culture on page 19.
MMK’S PRIME GEOGRAPHICAL LOCATION MEANS IT IS IDEALLY-PLACED TO SUPPLY ITS PRODUCTS TO THE
REGIONS OF RUSSIA AND FSU WHERE LEVELS OF METAL CONSUMPTION ARE HIGHEST
12.480mt
GROUP’S TOTAL SALES
9.041mt
GROUP’S DOMESTIC SALES
3.438mt
GROUP’S EXPORT SALES
34567
2
The Indirect economic impact and Local communities indicators are aggregated because a separate accounting methodology
for these indicators is under development.
3
Hereinafter is calculated as the share of sales in tonnes.
4
Domestic markets include Russian and FSU markets that are geographically close to the main production site in Magnitogorsk.
5
Including Steel segment Turkey sales.
6
Ukraine, Georgia, Armenia, Azerbaijan, Turkmenistan, Tajikistan, Kyrgyzstan, Moldova.
7
Central and Latin America, North America, Australia.
41%
23%
19%
9%
8%
Group export sales by region
Middle East
Europe
Asia
Africa
Other
62%
10%
28%
Group sales structure
Domestic (Russia)
Domestic (FSU)
Exports
4
86%
5%
4%
2%
3%
Group domestic sales by countries
Russia
Uzbekistan
Kazakhstan
Belarus
Other FSU
5
5
6
7
8

MMK INTEGRATED ANNUAL REPORT
9
OUR INVESTMENT CASE
In a world in which progress relies heavily on the supply of quality steel products, MMK presents
unrivalled potential for sustainable growth in the steel sector. Building on its long-established heritage,
the Company is able to benefit from a wealth of opportunities by making the most of its geographical
and geological advantages to produce world-leading steel products.
COMMON FEATURES
1. Prudent capital allocation:
 Investment projects IRR >20%;
 More than 100% of free cash flow dividend payout.
2. Low cost profile:
 1st quartile on the global cost curve.
UNCOMMON FEATURES
3. One of the highest TSR:
 MMK is one of the leaders among Russian and world steel companies, with a 129%
TSR generated over the past five years (2017 – 2021).
4. Lowest debt burden:
 Strongest balance sheet in the sector.
Our long-term objective is to ensure that the Group’s Net Debt/EBITDA ratio is no more
than 1.0x.
Financial stability remains a key focus for the Group. MMK’s debt leverage remains among the
industry’s lowest at -0.09x Net Debt/ EBITDA as of the end of the 2021 financial year (2020: -0.06x).
Credit ratings at or higher than the sovereign rating
8
:
BBB
Standard & Poor’s
Baa2
Moody’s
BBB
Fitch
RARE FEATURES
5. Unique market exposure:
 More than 80% of our products are sold in the domestic market: Russia and Former
Soviet Union (FSU). The Russian regions where MMK’s customers are based account
for over 45% of all steel consumed in Russia.
6. ММК is best positioned for potential upside as a result of the implementation of the National
Projects initiative:
 When domestic steel volumes rise by 10%, EBITDA could increase by 27%; when
domestic steel prices rise by 10%, EBITDA could increase by 9%
9
.
7. Unique high-quality product portfolio:
 42% of products sold are premium products.
8. Unparalleled access to raw material base:
 The forecasted cooling of iron ore prices should support better MMK earnings
momentum vs peers in the mid-term.
8
As of 31.12.2021.
9
Source: J.P. Morgan estimates.

MMK INTEGRATED ANNUAL REPORT
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BUSINESS MODEL
MMK brings together a range of processes to form a cohesive, effective operations: innovative approach to production methods and utilisation of raw materials, culture of operational excellence and digital innovations to drive
sustainable growth.
CAPITALS
VALUE CREATION DRIVEN BY EFFICIENT CORPORATE GOVERNANCE
OUTPUTS SSSSSSSSS
OUTCOMES
FINANCIAL
- Net Debt: –$393m
- Net Worth: $6,330m
- CAPEX: $1,132m
Our purpose
MMK aims to produce and deliver premium quality steel products in a way that generates
value for stakeholders, improves the quality of life of our employees and the people whose
communities are affected by our operations and allows our customers, and the world, to
benefit from the power and strength of steel.
Governance > pages 100-126
Our strategic objectives:
 To be the best supplier
 To be a leader in operational
excellence
 To be responsible, sustainable
business (ESG)
Strategy > pages 21-22
Pig iron
production
10.4mt
Crude steel
production
13.6mt
Total sales
12.5mt
Premium
products sales
5.2mt
Total air
emissions
12
187.1 ths tonnes
FINANCIAL
↑ TSR: 45.0%, +24.7 p.p. y-o-y
→ EBITDA: $4,290m, +188% y-o-y
→ FCF: $1,613m, +190% y-o-y
↓ Slab cash-cost: $400 per tonne,
+49% y-o-y
Stakeholders impacted: investors,
employees, suppliers and contractors
MANUFACTURED
- Pig iron (8 blast furnaces): 10 mtpa
- Crude steel (3 BOFs): 10 mtpa
- Crude steel (2 EAFs и 1 DHF): 6 mtpa
Our sustainable value chain- enabled by smart capital allocation and prudent risk management
MANUFACTURED
↑ Crude steel capacity utilisation rate (BOF):
97%, +2 p.p. y-o-y
↑ Crude steel capacity utilisation rate (EAF):
89%, +28 p.p. y-o-y
Stakeholders impacted: employees,
customers
Raw materials
> pages 45-47
We use our own iron ore and
coal in our production
Self-sufficiency
Production
> pages 47-51
We are a producer that carries
out every aspect of steelmaking
process
Pig iron
10mtpa
output from our eight blast furnaces
Crude steel
10mtpa
output from our basic oxygen furnaces
(BOF)
6mtpa
output from our electric arc furnaces (EAF)
and double-hearth furnace (DHF)
Products
> pages 51-55
We produce flat and long products and
focus on premium products
Premium product share
10
-
42%
Customers
> pages 83-86
We serve the needs of various
industries to enable economic growth
Industries
- Construction
- Energy
- Automotive
- Transport (machine building, ships,
railcars)
- Infrastructure (railways, bridges,
guard rails, ETLs and etc.)
- Packaging
- House hold appliances
Markets
Domestic market sales
72%
of our sales are made within the
domestic market (Russia and FSU
countries)
Exports
28%
of our sales are to export markets
(Asia, Middle East, Africa, etc.)
INTELLECTUAL
- Collaborations (Technical Institutes): 30
- Patents filed: 2
- R&D spend: $5.5m
INTELLECTUAL
↑ Product innovation: 961 ths tonnes,
+61.5% y-o-y
↓ Patents granted: 2, -50% y-o-y
Stakeholders impacted: employees,
customers
HUMAN
- Employees: over 53 thousand
- Investment in employee training and
development: $13.7m
- 67,808 person-courses taken by the
group’s employees as part of their training
programmes
- 44,633 employees completed pre-shift
briefing
HUMAN
→ LTIFR: 0.62, –6.1% y-o-y
↑ LTISR: 23.20, –1.9% y-o-y
↑ Employee engagement: 77.3%, +9 p.p.
y-o-y
Stakeholders impacted: employees
NATURAL
- Capital spend on the environment:
$186m
- Energy intensity: 21.81 GJ/t of crude
steel
NATURAL
↑ Specific GHG emissions
12
: 1.95 tCO
2
e / t of
crude steel, Scope 1+2, –10.6% y-o-y
↑ Solid waste utilisation: 14,474.2 ths
tonnes, -1.7% y-o-y
↑ Dust emission intensity
11
: 1.1 kg / t of
crude steel, –23% y-o-y
↑ Specific air emissions
12
: 14.1 kg / t of
crude steel, –8.0% y-o-y
↑ Total sites covered under recultivation
management plans
12
: 28.5 ha, +38.6% y-o-y
Stakeholders impacted: local communities
SOCIAL AND RELATIONSHIP
- Own sales distribution network units: 50
- Active supplier base: 2,440
- Investments in local development and
philanthropy: $16.3m
SOCIAL AND RELATIONSHIP
↑ OTIF: 72%, +8 p.p.
→ Savings resulting from supply and
procurement strategies: $7.5m,
+25% y-o-y
↑ Assistance provided to 54 schools
↑ Assistance provided to 20,451 pensioners
Stakeholders impacted: suppliers,
customers, government bodies, local
communities
10
Hereinafter is calculated as the share of sales in tonnes.
11
Company data.
65%
40%
17%
75%
Scrap
Coal concentrate
Iron ore
Electricity
42%
47%
11%
Product portfolio
Premium
products
Hot-rolled
products
Long
and semis
↑ Value creation
→ Value preservation
↓ Value erosion
To learn more about the production process > page 44

MMK INTEGRATED ANNUAL REPORT
11
A CONFIDENT OUTLOOK ENSURES OUR ABILITY TO CREATE VALUE IN THE FUTURE > PAGES 21-22, 27-28

MMK INTEGRATED ANNUAL REPORT
12
CHAIRMAN’S STATEMENT
CHAIRMAN
VICTOR RASHNIKOV
«
Dear colleagues, investors and partners!
At the time of this Integrated Annual Report, ongoing foreign policy
tensions have intensified as a result of developments in Ukraine,
creating a wide range of uncertainty in both the commodity and
financial markets. Today, we are all going through challenging times,
and I am sure we want a speedy, peaceful resolution to the current
situation. The full nature and potential consequences of the imposed
sanctions and restrictions on business activity are impossible to
assess at the moment. Nevertheless, we are taking all necessary
measures to ensure the sustainability of MMK Group's operations and
continue to work as usual, flexibly adapting to new circumstances.
Despite the challenges formed after the reporting date, I am pleased
to report that the Company achieved record production and financial
performance in 2021. The MMK team’s outstanding professionalism,
ambitions and focus on driving further growth, our long-standing
traditions and self-confidence all combine to enable us to achieve
our targets and thrive in challenging times.
Commitment to sustainable development
Steel is increasingly important in the modern world. Metal products such as
steel have the highest strength-to-weight ratio of any building material and can be
fully recycled many times over. The performance of steel is constantly evolving and
improving, and almost every key industry depends on it.
We are determined to harness the power and strength of steel for the benefit
of our customers and for the world; this is what drives our sustainability programmes.
We are not merely following trends on the global agenda; for MMK, sustainability
factors (ESG) are integrated throughout our business. They drive the Group’s strategy
to improve the Company’s environmental performance, social responsibility and
transparency of its corporate governance.
We are guided by best practices in this matter. MMK was the first Russian
company to include in its Report direct, indirect and other greenhouse gas emissions
verified by BSI Assurance UK Ltd. The Report also reflects the Group’s contribution to
the Sustainable Development Goals adopted by the UN. We are increasing our focus
on this area, with the Group’s newly updated strategy aiming to reduce its CO
2
emissions per tonne of crude steel to the global average – and even beyond – by
2025. We will achieve this through energy efficiency improvements and further
upgrades to our production facilities.
We are continuously reducing production emissions. We have carried out this
work non-stop for 20 years, since long before the concept of ESG had been thought
of. Thanks to our use of the best available technology, we have already surpassed
global benchmarks in terms of nitrogen oxide and sulphur dioxide emissions. MMK’s
level of dust emissions in 2021 is higher than the industry average, but we are working
hard to reduce this; over the past five years, we have halved our dust emissions and
have set ourselves new ambitious goals for 2025.
Focus on shareholder interests
MMK remains committed to its key strategic goal of generating high total
shareholder return. We do so thanks to a robust capital allocation policy which
provides for two key areas: investment in development and a strong dividend policy.
First, we make investments in development (including green investments) to increase
economic efficiency, increase production volumes, expand the product line and reduce
environmental impact. These investments are central to the strategic goal we set in

MMK INTEGRATED ANNUAL REPORT
13
2019 as part of our 2025 Strategy. We expect that the achievement of this goal will
have a positive effect on the Company's value creation.
MMK people are crucial for our success
The last couple of years have been extremely challenging and I want to thank
every one of our employees, from the Board to the shop floor, for their dedication,
skill and hard work that has helped us to succeed as we have. In particular, I would
like to pay tribute to the management of the Company for the way they responded to
the global economic shock caused by the coronavirus pandemic, firstly in overcoming
the initial crisis and then minimising its effect.
Our heritage is the foundation of our future
This year, 2022, our Company is celebrating its 90th anniversary. Throughout
its almost century-long history, MMK has been a recognised leader of Russia’s metals
industry and one of the largest metal producers in the world. The past gives us much
to celebrate and, thanks to modernisation and digital operations, advanced technology
and promising investment projects, we have continuing confidence in the future.
Our future is built on 90 years of history and MMK is well
placed to continue to go from strength to strength. We aim to be the
best supplier in our market, a leader in operational excellence and a
responsible, sustainable business. This strategy has proved
successful and, as we enter our tenth decade, we are a strong,
modern Company, fit to continue as one of the world’s leading
producers of metal.
»

MMK INTEGRATED ANNUAL REPORT
14
CEO’S STATEMENT
CHIEF EXECUTIVE OFFICER
PAVEL SHILYAEV
«
Dear shareholders, colleagues and partners!
The coronavirus pandemic has proven a major challenge for
both the global economy and the metals industry which had to
operate in an extremely uncertain and highly volatile environment.
Nevertheless, as early as in 2021, we not only managed to return to
pre-pandemic sales levels but even surpassed them by a significant
margin, having increased shipment volumes to over 12 million
tonnes for the first time since 2007.
Positive market dynamics and the global economic recovery
enabled us to deliver record performance across key performance
metrics. As demand picked up in our key markets, the launch of Hot-
Rolling Mill 2500 and reversing Cold-Rolling Mill 1700 following its
upgrade drove an increase in sales volumes by 16%, or 1.7 million
tonnes of metal products, compared to 2020.
The robust sales growth had a positive impact on our bottom
line, with revenue, net profit, and free cash flow up significantly.
EBITDA increased 2.9 times while EBITDA margin reached 36.1%.
Investing activities
We invest in line with our vision for a sustainable future for all stakeholders.
MMK Group’s current Strategy 2025 allows for fundamental upgrades to the first
processing stages to further reduce production costs, improve product quality, and
mitigate our environmental impact even further. We are exploring options to reduce
our carbon footprint together with our partners, such as using synthesis gas (SYNGAS)
to fuel our blast furnaces. This technology will reduce our CO
2
emissions by a further
600,000 tonnes per year.
We have made progress on a major investment project to construct Coke-Oven
Battery No. 12 with an annual capacity of 2.5 million tonnes of dry coke. The facility’s
construction cost is $755 million. Commissioning of phase one of Coke-Oven Battery
No. 12 is scheduled for 2022.
In 2021, we completed the upgrade of Cold-Rolling Mill 1700 at Rolling Shop
No. 5 which further strengthened its position in the market for high-quality rolled
products for the automotive industry.
MMK and Paul Wurth signed a contract last year for the construction of Blast
Furnace No. 11. The investment into the project are expected at $1,075 million. The
cutting edge blast furnace will have a working volume of 3,800 cubic metres and an
annual capacity of 3.7 million tonnes of pig iron. The construction of Blast Furnace No.
11 will be a breakthrough for blast furnace production at MMK, enabling the retirement
of three operating furnaces and significantly improving the economic and
environmental performance of production facilities.
Environmental efforts
MMK’s development strategy prioritises building a comfortable, healthy and
enabling environment for people across the Group’s operating regions. We pay
particular attention to our environmental programmes, which are an integral part of
our ESG initiatives. They use the best available technologies, modernise production,
build the most advanced environmental facilities and highly efficient production
complexes and retire outdated facilities. By 2025, we will reduce our comprehensive
air pollution index to 5 (consistent with the Clean City concept), and the level of
greenhouse gas emissions at MMK will drop to 1.8 tonnes of CO₂-equivalent per tonne
of steel (below the global average).

MMK INTEGRATED ANNUAL REPORT
15
Digital innovation
To facilitate gains in operational and functional efficiency, MMK has adopted a
Digitalisation Strategy that reflects global technological trends and covers almost all
functional areas across the Company’s business. The current portfolio spans to 2025
and contains about 200 digital initiatives. Some example innovative solutions include
data analytics, digital twins of production units and facilities, Industrial Internet of
Things, development of cloud services, use of robots and unmanned solutions, and
higher mobility of technology. The implementation of these digital initiatives will drive
EBITDA increase by $30 million by 2025.
Social strategy
Amid the COVID-19 pandemic, employee health and safety remains our top
priority. A hard-hitting awareness campaign has driven the vaccination rate among
employees to 90% at year-end 2021. We focused on improving the occupational safety
culture while continuously tackling the root causes of accidents, and this was reflected
in a decrease in the LTIFR by 6.1% in 2021 to 0.62 y-o-y. Our target is a LTIFR of
0.45 by 2025.
At the same time, support for local communities has traditionally been high on
the Company’s agenda. MMK is actively involved in building up the infrastructure in
Magnitogorsk and adjacent areas, including cultural and sports facilities, and supports
civil society groups and educational institutions. In addition, MMK provides assistance
to veterans, people with disabilities, large families, and other low-income groups.
MMK pays particular attention to the implementation of social programmes for
its employees. MMK’s Social Policy identifies 11 support channels for Company
employees. Social benefits and guarantees set out in the collective bargaining
agreement and the annual expansion of the benefits package are additional incentives
for employees. MMK ensures consistent salary increases; since 1 July 2021, MMK
Group companies have raised employee wage rates by 6.5%. MMK strives to meet the
highest standards in protecting and promoting human rights across its operating
regions.
Developing corporate culture
In 2021, MMK was the first Russian company to receive a gold accreditation
from Investors in People, a prestigious international standard that evaluates the
quality of HR management. We can only benefit from unlocking the full creative
potential of our workforce and maximising employee engagement. Therefore, we pay
particular attention to providing employee training and driving innovation and
invention. MMK’s employee suggestion scheme, developed in-house, has proven
effective, as evidenced by the annual improvements in the number and quality of
proposals submitted, as well as by shorter implementation timelines. In 2021, MMK’s
innovations won several gold medals at international invention competitions in
Moscow and Taipei.
Driving for success together
I am particularly grateful to MMK Group employees for their dedication,
integrity and initiative. Our strong performance in 2021 is the result of highly
professional and efficient work of the entire team, everyone’s determination to move
forward in search of new solutions delivering economic and technological benefits. I
would also like to thank our shareholders, investors and partners for their trust in
MMK and their commitment to developing our relations.

MMK INTEGRATED ANNUAL REPORT
16
As the Chairman noted above, we live in a time of
unprecedented geopolitical and economic challenges. We have faced
the challenges of the times more than once - changes in market
conditions, restrictions and crises. We are prepared for them and
know how to work in a changing environment. I am confident that
joint efforts will not only enable us to consolidate our previous
achievements but also reach new heights in the future.
»

MMK INTEGRATED ANNUAL REPORT
17
HOW WE MAKE STRATEGIC DECISIONS
Despite its complexity, the decision-making process at MMK is nevertheless transparent and
sufficiently clear to allow us to reach timely informed decisions in support of our key strategic goal -
an increase in total shareholder return.
The entire process comprises three main steps:
1. Exploration and analysis
We perform STEP and SWOT analysis as well as actively engage with our stakeholders to
understand which internal and external factors have a significant impact on our ability to create value
in the short, medium and long term. We analyse investor and analyst enquiries, reports from other
companies in the industry, enquiries from local communities and our customers, and questions
received by the Board of Directors.
Read more – pages 29-33
We are continually analysing trends that will have a major impact on the development of the
steel industry in the future. MMK has a system in place to monitor changes in the external environment,
new technologies and new customer requirements. This means we can react flexibly and adapt quickly
to new conditions in the industry.
Read more – pages 27-28
Risk-informed thinking, integrated into our management through our risk management system,
helps us anticipate and prevent adverse outcomes at the same time as capitalising on opportunities.
Read more – pages 91-99
2. Active strategy development and actualisation
Stakeholder feedback, received through a variety of communication channels, helps us identify
material topics which, together with the identified risks, observed market trends and other factors,
form the basis of our strategy and subsequently help us implement it consciously.
The Company’s ten-year strategy is developed within the long-term planning process framework
with the direct participation of the CEO, top management and independent members of the Board of
Directors. The strategy is approved by the Board of Directors.
Every five years, the long-term strategy is reviewed and updated. The responsible divisions
annually revise the main provisions and prerequisites of the current strategy. In the event of significant
changes in the external environment, an early review of the strategy may be initiated.
In 2015, MMK's Board of Directors approved the MMK Group's Strategy to 2025. In 2020, within
the framework of the current strategy, the Company's strategic priorities were updated and a focus
was placed on the active implementation of sustainable development principles in all areas of the
Company's operations.
Our 2025 strategy is to drive value through sustainable growth, delivering strong performance
in all aspects of the business.
Our goal is to be the best supplier to all our customers by offering an optimal product portfolio
and operating according to a continually developing customer-oriented business model. We strive to
become an industry leader in operational efficiency, always keeping in mind the need to pay close
attention to sustainability. We continue to develop and implement digitalisation in all areas of our
business.
Read more – pages 21-22
3. Strategy execution and control
Our approach to capital allocation is driven by our strategic aim to be the best provider and
leader in both sustainability (ESG) and operational efficiency: we decide where to focus our resources,
guided by our commitment to building a sustainable future. This prioritisation, in turn, is based on the

MMK INTEGRATED ANNUAL REPORT
18
Group's long-standing reputation for producing quality steel products that make the most of the natural
advantages of our geographic location.
Read more – pages 35-37
The Board of Directors and Management Board oversee the implementation of the strategy. We
measure our performance using a wide range of key performance indicators (KPIs), which are aligned
to the objectives of our strategy. Every year, as part of our executive compensation system, the
Company approves company-wide KPIs. KPIs allow us to set out in detail our plans to achieve
company-wide goals, and motivate managers to work on problem areas in their areas of responsibility.
Read more – pages 23-26
TRADE-OFFS
In the process of making strategic decisions focused on long-term value creation, we are
inevitably faced with challenges that require complex trade-off decisions. The need to make trade-off
decisions most often manifests itself between capitals or components of capital, between different time
horizons, and between capitals owned by the organization and capitals owned by others or owned by
none.
The most significant trade-offs made in 2021:
Capital
Trade-off
Financial
Focus on sustainable and organic growth without the need for costly corporate
activities, in particular mergers and acquisitions (in iron ore) and divestitures
(in coking coal) in the raw materials sector
Manufactured
Restart of steel production activities at the Steel Turkey segment
Intellectual
Investments in R&D and digital technologies to reach a new level of
production organization and consumer value creation
Natural
Investments in development in 2022-2025 increased by 30% to $1.25 billion
on the back of significant environmental investments to mitigate any adverse
environmental impacts on our employees and communities
Human
- Funding programs and projects related to COVID-19 to keep employees
healthy and maintain continuous operations
- Investing in training and development to meet our goals of increasing
productivity and developing a culture of opportunity
Social and
relationship
Investments in creating a comfortable environment in the regions of presence
to strengthen and maintain the Company's reputation

MMK INTEGRATED ANNUAL REPORT
19
FOCUS AREAS FOR THE BOARD IN 2021
Focus areas
Matters reviewed
Strategy 2025 execution
- Explored options to strengthen the Company’s position in priority markets, in particular in
Russia’s automotive industry
- Agreed to further improve the product portfolio
- Explored options to improve operational and functional efficiency
- Explored options to improve procurement and supply chain management
- Approved the pillars of the MMK Group’s Strategy 2025
- Reviewed the key performance indicators in 2020
- Approved the 2020 Report of the Board of Directors on the Results of MMK’s Priority
Activities
- Reviewed the results of digital projects
Stakeholders
- Reviewed the results of investor relations activities in 2020
- Approved the MMK Group’s priority HR initiatives for 2021
- Approved MMK’s organisational structure
- Approved the Exchange-Traded Bonds Programme
- Recommended dividends for FY 2020, Q1 2021, 1H 2021, and 9M 2021
- Pre-approved the 2020 Integrated Annual Report
- Reviewed the results of the environmental programme
Risks
- Reviewed the effectiveness of MMK’s integrated risk management system in 2020
- Reviewed the effectiveness of the internal control system in 2020
- Approved the MMK Group’s risk appetite statement
- Reviewed cybersecurity issues
Performance of the Board of
Directors
- Reviewed the results of an external performance evaluation of MMK’s Board of Directors,
Board members and Board committees in 2020
- Determined the amount of remuneration and compensation paid to Board members
during their term of office in 2021–2022
- Approved the Corporate Governance Improvement Programme up to 2024
- Reviewed requirements for nominees to the Board of Directors and assessment criteria
- Proposed to consider a performance self-evaluation exercise for MMK’s Board of
Directors, Board members and Board committees in 2021
BOARD FOCUS AREAS IN 2022:
- Strategy 2025 execution
- Stakeholders
- Risks
- Environment
- Performance of the Board of Directors

MMK INTEGRATED ANNUAL REPORT
20
STRATEGIC FRAMEWORK
Our Purpose
MMK aims to produce and deliver premium quality steel products in a way that generates value
for stakeholders, improves the quality of life of our employees and the people whose communities are
affected by our operations and allows our customers, and the world, to benefit from the power and
strength of steel.
Our vision
The MMK Group is a highly efficient Russian metals producer that focuses on meeting the needs
of our customers and adheres to the best practices for occupational health and environmental safety
and ensures the retention of professional, proactive and motivated personnel.
Our strategy
Is to drive value through sustainable growth, delivering quality in all aspects of the business.
The MMK Group focuses on the following core and relevant SDGs to provide a meaningful
contribution:
8. Promote inclusive and sustainable economic growth, employment and decent work for all
9. Build resilient infrastructure, promote sustainable industrialisation and foster innovation
12. Ensure sustainable consumption and production patterns
13. Take urgent action to combat climate change and its impacts

MMK INTEGRATED ANNUAL REPORT
21
Our culture and values
The corporate culture of MMK is the basis for achieving business success and is closely aligned
to the Company’s strategy. MMK contributes to improving people’s quality of life and creating new
opportunities in the region where it operates. Ever-greater sustainability is facilitated by an effective
corporate governance system to build trust with stakeholders.
Our values:
- Partnership approach to our customers
- Continuous improvement across all business lines
- Continual development of our people, creation of opportunities for personal and professional
fulfilment
- Safety at work
- Respect for the environment; social and environmental responsibility.

MMK INTEGRATED ANNUAL REPORT
22
STRATEGY
Our strategic goal is to achieve $1 billion EBITDA growth by 2025 by implementing our portfolio of strategic initiatives.
12
In comparison with 2019.
13
OTIF (On Time In Full) measures delivery timeliness and completeness.
Focus area
Strategic initiatives
Levers
Linked capitals
Linked risks
2021
2022 targets
2025 targets
Targets
Results
12
Status
To be the best
supplier
1. Superior product
portfolio
Building a superior
product portfolio with a
focus on higher
margins through
expanding premium
product ranges and
improving the service
offering
 Increasing the share of
high-margin products in the
product portfolio
 Developing customer
services
 Digitalisation
 Financial
 Intellectual
 Social and
relationship
 Production
 Market
 Financial
 Economic security
Be a leader in sales in the
Russian market
Have the largest share of
premium products in the
Russian market
Increase the output of the
most in-demand innovative
products
Incremental EBITDA of $26m
16.9% –
MMK’s market share in sales of steel
products, the largest in Russia
MMK has the largest share of sales to the
automotive industry, covering over 50% of
the demand, and is the sole supplier for the
production of AURUS cars
4mt incremental premium products sales –
growth of almost 2% by 2020
72 innovative products weighing a total of
961 ths tonnes produced and shipped to
the market
Target met
Target met
Target met
Target met
Be a leader in sales in the
Russian market
Have the largest share of sales to
the automotive industry
Increase premium products sales
Increase the output of the most
in-demand innovative products
EBITDA growth
+$350m
2. Customer focus
Customer focus with
continuous
improvement of
customer service and
developing sales
through trading houses
and digital channels
70% – supply discipline
(OTIF)
13
Develop sales channels
through own distribution
network
Launch and develop MMK
Marketplace
Implement a CRM system
Construction of a logistics
centre
Incremental EBITDA of $15m
72% – supply discipline (OTIF)
15% – share of sales through own
distribution network
Launch of MMK Marketplace:
- Over 300 new customers every month;
- 2/3 of customers are end users
Proportion of end users in the total number
of own distribution network customers:
76.7%
Two standalone units set up and two
warehouses opened
Launch of the retail sales project: two
outlets opened
Implementation of a CRM system: stage 1
completed
The project has been implemented
Target met
Target met
Target met
Target met
Target met
Target met
Target met
Target met
Improve supply discipline (OTIF)
Develop sales channels through
own distribution network
Develop MMK Marketplace:
– Attract third-party suppliers
– Offer new banking products and
expand the product portfolio
Increase the share of sales to end
users
Set up new units within the
Trading House
Develop the retail sales project
Implement a CRM system
Launch the logistics centre
EBITDA growth
+$60m

MMK INTEGRATED ANNUAL REPORT
23
Note: Applied exchange rates for 2021: RUB 73.6 per $ (for all metrics except for savings resulting from supply and procurement strategies); RUB 78.0 per $ (for savings resulting from supply and procurement strategies).
14
Low-cost, high-impact investment projects.
15
CRU data.
16
Target not met due to delays in equipment deliveries, design, and construction and installation caused by COVID-19 constraints.
17
Target not met because since 2021 calculation covers injuries sustained by third parties at the MMK Group’s sites.
18
Comprehensive Air Pollution Index.
To be a leader in
operational
excellence
3. Leadership in
production efficiency
Excellence in
production through
higher production
volumes, upgrades,
and cost reduction
driven by the
continuous
improvement of
internal processes
 Organisational and
technical measures
 Energy management
 Baby CAPEX
14
 Innovation and employee
suggestions
 Digitalisation
 Financial
 Manufactured
 Social and
relationship
 Production
 Market
 Economic security
Maintain the position of a
low-cost producer on the
global cost curve (HRC)
Implement 19 Baby CAPEX
projects with an economic
benefit of $16.0m
Leader in energy efficiency:
The MMK Group’s energy
intensity 21.81 GJ/t of steel
Incremental EBITDA of $220m
MMK remained in the Top 10 of the world’s
lowest-cost producers
15
12 Baby CAPEX projects implemented with
an economic benefit of $7.54m
The MMK Group’s energy intensity
21.81 GJ/t of steel
Target met
Target not met
16
Target met
Remain in the Top 10 of the
world’s lowest-cost producers
Implement 21 Baby CAPEX
projects with an economic benefit
of $12.4m
Leader in energy efficiency
EBITDA growth
+$610m
Boost BOF steel output
(+1mt)
4. Excellence in
procurement and
supply chain
management
Excellence in
procurement and
supply chain
management aligned
with global best
practices and ensuring
the most efficient
material and service
procurement
$5m
savings resulting from supply
and procurement strategies
Incremental EBITDA of $9m
$7.5m
savings resulting from supply and
procurement strategies
Target met
Develop category management to
cut costs
EBITDA growth
+$20m
To be a
responsible,
sustainable
business (ESG)
5. Zero injuries
 Digitalisation
 Automating safety
systems
 Robotic process
automation and video
analytics
 OHS supervision
 Creating a culture of
engagement and innovation
 Natural
 Human
 Social and
relationship
 Production
 Sustainability
0.57 –LTIFR
Implement automated safety
systems
0.62 – LTIFR
Automated safety systems implemented in
the coke shop
Target not met
17
Ongoing
0.56 – LTIFR
Implement and develop
automated systems in the coke,
blast furnace, and BOF shops
Exclude employees’ presence in
high-risk areas
Reduce LTIFR to 0.45 and
fatalities to zero
6. Corporate culture
of opportunities
Encourage employees
suggestions
Increase employee
engagement by 5%
$8.2m
economic benefit from implemented
employee suggestions
77.3% employee engagement
Target met
Target met
Encourage employees
suggestions
Increase employee engagement
Halve time-to-market for
new products
Manage engagement
7. Continuous
improvement of
environmental
performance and
reduction in CO
2
emissions
2.00
specific CO
2
emissions
(tonnes of CO
2
per tonne of
steel), Scope 1+2
1.95
specific CO
2
emissions (tonnes of CO
2
per
tonne of steel), Scope 1+2
Target met
1.98
specific CO
2
emissions (tonnes of
CO
2
per tonne of steel),
Scope 1+2
Reduce specific CO
2
emissions to 1.8 tonnes of
CO
2
per tonne of steel
Achieve full transparency
of environmental data
and disclose them to all
stakeholders
Further improve CAPI
18

MMK INTEGRATED ANNUAL REPORT
24
KEY PERFORMANCE INDICATORS
Category
KPI
2019
2020
2021
Financial
performance
* Total shareholder return (TSR), %
17.7
20.3
45.0
+24.7 p. p.
year-on-year
Link to strategy
To be the best supplier
To be a leader in operational excellence
Measurement
TSR calculation reflects generation of shareholder value through share price appreciation and
dividends paid over the reporting period
Performance overview
TSR increased, driven by positive market cap dynamics and high dividend yield due to
favourable market conditions
Associated capital
Financial
* EBITDA, $m
1,797
1,492
4,290
x2,9
year-on-year
Link to strategy
To be the best supplier
To be a leader in operational excellence
Measurement
EBITDA is calculated based on operating profit adjusted for depreciation and loss on disposal
of property, plant and equipment (PPE) (deducted), and the share of the financial results of
associates, including impairment of investments in associates (added)
Performance overview
EBITDA hit a record level due to favourable market conditions, with EBITDA margin up 12.8
p.p. year-on-year to 36.1%
Associated capital
Financial
* Free cash flow, $m
883
557
1,613
x2,9
year-on-year
Link to strategy
To be the best supplier
To be a leader in operational excellence
Measurement
Free cash flow is calculated as net cash from operating activities plus interest received and
proceeds from disposal of PPE and intangible assets, net of purchase of PPE and intangible
assets (CAPEX)
Performance overview
FCF increased 2.9 times year-on-year, reflecting higher sales volumes and metal prices
Associated capital
Financial

MMK INTEGRATED ANNUAL REPORT
25
Sales and
market share
* Sales volumes, mt
11.3
10.8
12.5
+15.7 %
year-on-year
Link to strategy
To be the best supplier
Measurement
The volume of metal products sold within the period
Performance overview
Growing demand for metal products in Russia and globally led to a 16% year-on-year increase
in consolidated sales of the MMK Group metal products
Associated capital
Manufactured
Social and relationship
* OTIF
19
, %
54
64
72
+8 p. p.
year-on-year
Link to strategy
To be the best supplier
Measurement
OTIF is calculated as the number of orders fulfilled on time in full in the selected period divided
by the total number of orders
Performance overview
OTIF was up 8 p.p. year-on-year, confirming the effectiveness of measures taken to increase
the proportion of timely shipped orders as part of efforts to improve customer experience
Associated capital
Social and relationship
Product innovation
20
, ‘000t
799
595
961
+61.5 %
year-on-year
Link to strategy
To be the best supplier
Measurement
The indicator is calculated as the total volume of products with additional characteristics and
new types of products mastered and shipped to the market
Performance overview
The indicator increased year-on-year on the back of a general increase in the volume of
products shipped, as well as due to the expansion of opportunities to meet customer demand
for hot-dip galvanised, heavy plates and billets
Associated capital
Intellectual
19
The indicator covers MMK only.
20
The indicator covers MMK only.

MMK INTEGRATED ANNUAL REPORT
26
Operational
efficiency
Slab cash cost, $/t
305
269
400
+48.7 %
year-on-year
Link to strategy
To be a leader in operational excellence
Measurement
The slab cash cost is calculated by dividing costs
21
incurred in the production process by the
volume of basic oxygen furnace (BOF) steel output for the period
Performance overview
The slab cash cost increased 48.3% year-on-year, driven by significantly higher prices of iron
ore (over 64%), coal concentrate (over 80%), and scrap metal (over 50%)
Associated capital
Manufactured
Energy intensity, GJ/t of steel
22.52
21.88
21.81
–0.3 %
year-on-year
Link to strategy
To be a leader in operational excellence
Measurement
The integrated indicator is calculated as the difference between the MMK Group’s total energy
consumption and energy generation/utilisation divided by MMK’s steel production
Performance overview
The 0.3% year-on-year reduction in energy intensity across the MMK Group in 2021 was due
to a 13% increase in steel production and a 2.9% decrease in the share of pig iron in the
steelmaking charge, which has contributed to improving the energy efficiency of the MMK
Group
Associated capital
Manufactured
* Savings resulting from supply and procurement strategies, $m
10
6
7.5
+25.0 %
year-on-year
Link to strategy
To be a leader in operational excellence
Measurement
Actual savings resulting from supply and procurement strategies
Performance overview
The savings were delivered by expanding the competitive landscape through engaging new
suppliers, using corporate discounts and purchasing identical products from different
manufacturers with more competitive pricing
Associated capital
Social and relationship
21
Costs incurred in the production process include raw materials (iron ore, pellets, coking coal, ferroalloys, scrap metal, and other materials), fuel and power, labour, repairs and maintenance of
fixed assets, and other costs.

MMK INTEGRATED ANNUAL REPORT
27
Sustainable
development
* LTIFR, over the past 12 months
0.89
0.66
0.62
–6.1 %
year-on-year
Link to strategy
To be a responsible, sustainable business (ESG)
Measurement
LTIFR is calculated as the number of lost-time injuries per million of person-hours worked
Performance overview
LTIFR decreased year-on-year to 0.62, reflecting a decrease in the number of accidents. This
reduction was due to the implementation of measures to improve safety culture around
production and to eliminate the root causes of accidents
Associated capital
Human
* Employee engagement, %
–
22
68.3
77.3
+9 p. p.
year-on-year
Link to strategy
To be a responsible, sustainable business (ESG)
Measurement
The indicator
23
is calculated as the average percentage of engagement at each unit, based on
the scores given in answers to survey questions in focus group workshops
Performance overview
Employee engagement increased by 9 p.p. year-on-year, following remedial actions aimed at
increasing job satisfaction
Associated capital
Human
CO
2
(greenhouse gas emissions), t CO
2
e/t of steel (Scope 1+2)
Link to strategy
To be a responsible, sustainable business (ESG)
2.13
2.18
1.95
–10.6%
year-on-year
Measurement
GHG emissions are calculated according to the guidelines of the Russian Ministry of Natural
Resources and Environment as per Order No. 300 dated 30 June 2015, as well as ISO 14064-
1:2018 and ISO 14067:2018. The calculation includes CO
2
emissions only
Performance overview
The reduction of specific greenhouse gas emissions is mainly due to increased production of
electric steel and implementation of energy efficiency measures, which directly affects the
amount of greenhouse gas emissions
Associated capital
Social and relationship
Natural
Note:
1. * Indicators included in MMK’s senior management incentive system.
2. Applied exchange rates: 2020 – RUB 72.4/$; 2021 – RUB 73.6/$ (for all KPIs except for savings resulting from supply and procurement strategies), RUB 78.0/$ (for savings
resulting from supply and procurement strategies).
3. OTIF, product innovation and CO
2
(greenhouse gas emissions) cover MMK only. All other indicators are calculated for the MMK Group.
22
The indicator was not calculated in 2019.
23
The engagement level is considered average if its value ranges between 50% and 80%, high if more than 80%, and low if less than 50%.

MMK INTEGRATED ANNUAL REPORT
28
MARKET TRENDS
Trend
Long-term trend description
MMK’s response/capabilities
Links to capital
Timeframe
Decarbonisation
Climate change is affecting not only national policies but also
the long-term strategies of companies around the world amid
changing global market patterns. At the COP26 summit held in
Glasgow in November 2021, Russia announced its intention to
achieve carbon neutrality by 2060; the European Parliament
continues to work on its draft Carbon Border Adjustment
Mechanism (CBAM) regulation. The rapid rise of carbon capture
and hydrogen technologies will help Russia stay globally
competitive
We are aware of the scale of the challenges facing the world in
combatting climate change. Close to 60% of development
investments are channelled towards environmental projects.
We harness the best available technologies to meet our targets
of reducing CO
2
emissions to 1.8 tonnes per tonne of steel by
2025. The two ongoing landmark projects – Coke-Oven
Battery No. 12 and Blast Furnace No. 11 – will help us reduce
our gross CO
2
emissions by 2.8 million tonnes by 2025 and
achieve our decarbonisation targets
– Natural
– Social and
relationship
Long-term
trend
Green economy
Our customers are striving more and more to become CO
2
-
neutral and are considering the entire life cycle of products.
Concepts such as smart cities, smart buildings and zero-
emission vehicles have become commonplace.
Steelmakers therefore need to develop innovative, unique,
customised and high-quality premium products not only to
make the process of steel production as eco-friendly as possible,
but also to provide our customers with those products which
support them in satisfying all the new environmental
requirements
At MMK we understand that the weight of products such as
steel structures and vehicles will continue to become lighter
despite maintaining their strength. That is why we focus on
the development of new steel grades characterised by their
light weight and strength.
The new steel grades we have designed in response to
emerging global trends – such as MAGSTRONG, cryogenic
steels, and bimetal grades – have already been warmly
welcomed by industries embracing the green transition,
including renewables, LNG
24
transport and others
– Financial
– Manufactured
– Intellectual
– Natural
– Human
– Social and
relationship
Long-term
trend
Reuse of resources
We live in a circular economy era. Reuse and recycling are the
key elements of the circular economy which have rapidly
become the new normal.
Steel is an integral part of the circular economy helping to build
a sustainable future.
Besides being 100% recyclable itself, the process of steel
production is becoming more and more efficient, driven by
careful use and recovery of energy, water recirculation and the
reuse of slag and tailings in other industries
We seek to maximise the reuse of all the resources involved or
generated in our production flow.
We reuse metal-containing waste in production processes.
Sludge and metal fines are used in the production of cement,
while our blast furnace slag is used as a road fill material.
Secondary gases – blast furnace and coke gas – are involved
in the production flow to heat slabs and billets or to generate
electricity and steam. Water is recirculated within the plant for
cooling purposes; almost all the water used in steelmaking is
cleaned and either reused or returned to its source
- Financial
- Natural
- Social and
relationship
Long-term
trend
24
LNG stands for liquefied natural gas.

MMK INTEGRATED ANNUAL REPORT
29
COVID-19
The COVID-19 pandemic has strongly affected global economic
development.
Lockdowns and supply chain disruptions have pushed inflation
up globally and continue to affect businesses around the world.
The shortage of semiconductors has slowed down the recovery
of the automotive market.
In recent years, the metals industry has seen a significant
market imbalance and rising prices for raw materials and metal
products
Despite the pandemic-induced challenges, Russia’s car output
grew 10% y-o-y
25
in 2021, which, combined with our retention
of a leading position in terms of deliveries in Russia, helped
increase our sales to the automotive industry.
By leveraging our cost optimisation and BAT
26
implementation
programmes, we were able to stay in the Top 10 of the world’s
lowest-cost steel producers (by cost of hot-rolled coils)
- Human
- Social and
relationship
Medium-term
trend
Geopolitics
In 2022 ongoing foreign political tension escalated, as a result
of further developments in Ukraine, which may have a negative
impact on commodity and financial markets, and increased
volatility, particularly with regard to foreign exchange rates and
financial markets. There is an expectation of further sanctions
and limitations on business activity of companies operating in
respective regions, as well as consequences on the economy in
general, but the full nature and possible effects of these are
unknown
Management is taking the necessary measures to ensure the
sustainability of the Group's operations. However, the future
effects of the current economic situation are difficult to predict
and management's current expectations and estimates could
differ from actual results
- Financial
- Manufactured
- Intellectual
- Natural
- Human
- Social and
relationship
Long-term
trend
Digitalisation
The rapid growth of new digital technology entering all aspects
of the economy is integral to modern competitive business.
Digital technology is embedded in all processes that keep an
enterprise running, helping to create and unlock value for all
stakeholders and making the organisation more agile and
efficient
We aim for leadership in technology and innovation in the steel
industry. Over the past six years, we have developed and
implemented 15 digital projects for first-stage process
optimisation, production management, sales/procurement
management, and product quality improvement. We have
deployed a digital Machine Learning platform to speed up
projects and boost their performance
- Financial
- Manufactured
- Intellectual
- Natural
- Human
- Social and
relationship
Long-term
trend
25
Rosstat data.
26
BAT stands for best available technologies.

MMK INTEGRATED ANNUAL REPORT
30
STAKEHOLDER ENGAGEMENT
HEAD OF ESG
YAROSLAVA VRUBEL
«
We are committed to the concept of sustainability, which is an
integral part of the MMK Group's management practices. In 2021,
we continued to integrate sustainability principles into all aspects of
the Group's operations, improving our approach to ESG and striving
to achieve the goals of the MMK Group's Development Strategy to
2025.
In the reporting period, we made significant progress toward
meeting our economic, environmental and social commitments,
implementing our planned activities, and strengthening open and
trusting relationships with our stakeholders.
An important priority for us is to adhere to industry-leading
ESG practices and international standards. We strive to contribute to
the achievement of the UN Sustainable Development Goals and
improve performance on key ESG issues for the MMK Group.
»
The MMK Group recognises that the growth and sustainability of its business depend on the
successful maintenance of open, long-term relationships with its stakeholders. The MMK Group
maintains an open dialogue with its stakeholders and considers their interests in its activities in
determining our future development, including in the ESG sphere.
In 2021, the MMK Group continued to actively engage with representatives of all key
stakeholder groups. In particular, we surveyed more than 400 people, including MMK employees,
management and external stakeholders, in order to prioritise material topics for disclosure of non-
financial information in the Group's Report. Material topics are those that are the most significant for
MMK and its subsidiaries' stakeholders, as well as for the Group in terms of its impact on this topic.
The results were used to compile a materiality matrix, demonstrating the level of materiality of each
of the 14 topics of economic, environmental and social importance. The vertical axis shows the level
of importance of the topic for external stakeholders in terms of the influence it has on external
stakeholders in their decision-making regarding the MMK Group. The horizontal axis shows the
significance of the topic in terms of its impact on the MMK Group's activities, as well as the impact on
the topic by the Group.
Considering the needs and expectations of stakeholders, the MMK Group strives to disclose the
most complete and reliable information possible on all priority ESG areas, highlighting the key
economic, environmental, and social results and achievements of the Group.
The MMK Group actively engages with stakeholders, taking into account their views and
interests. Understanding the values and needs of our stakeholders helps us build trust-based, open,
and mutually beneficial long-term relationships. To identify stakeholder expectations and concerns, we
use a wide range of feedback tools, including contact with responsible persons and departments, social
media, and customer support centre contacts. The Company holds a range of events and meetings in
order to establish and maintain an open dialogue with stakeholders. Read more about the Board’s
engagement in 2021 on page 107.

MMK INTEGRATED ANNUAL REPORT
31
MATERIAL TOPICS MATRIX
MATERIAL TOPICS
1 Energy efficiency
8 Local community development
2 Biodiversity
9 Human rights
3 Waste management
10 Employee engagement
4 GHG emissions and climate change
11 Corporate governance
5 Air emissions
12 Anti-corruption and ethics
6 Water management
13 Supply chain
7 Occupational health and safety
14 Economic performance
Energy efficiency
Biodiversity
Waste management
GHG emissions and
climate change
Air emissions
Water management
Occupational
health and safety
Local community
development
Human rights
Employee
engagement
Corporate
governance
Anti-corruption and ethics
Supply chain
Economic performance
3.50
3.70
3.90
4.10
4.30
4.50
4.70
3.50 3.70 3.90 4.10 4.30 4.50 4.70
Significance of the topic for stakeholders
in terms
of influence exerted by the topic on the
assessment and
decision
-making regarding the
Group
Significance of the topic for the Group in terms of the infulence the group has on it and
its impact on the Group’s activities

MMK INTEGRATED ANNUAL REPORT
32
Stakeholders
Material topics
Stakeholder interests and
expectations
Engagement mechanisms
and tools
2021 highlights
Key 2021 engagement
results
Employees
Capitals:
- Financial
- Manufactured
- Intellectual
- Human
7, 9, 10
− Compliance with the Labour
Code, Collective Bargaining
Agreement, and internal
regulations and policies
− Decent wages and social
benefits
− Job retention
− Career and development
opportunities
− Safe working conditions and
the environment
− Ensuring occupational health
and safety of production
(operating) processes
− The My MMK corporate app
− Employee surveys
− Social media
− Security Director hotline, e-mail,
Ethics post office box
− Ethics hotline, e-mail, Ethics post
office box
− Communications about the
activities of the Human Resources
corporate training centre
− Skills contests to identify the best
employees
− Scientific and engineering
conferences
− Strategic Initiative Programme
"Zero Injuries"
− Rollout of additional
communication channels at
the shop-floor level
− Enhancement of all
training programmes for the
management talent pool run
at the corporate training
centre with sections on ESG,
D&I, safety awareness,
ecology, and human rights
− Implementation of the
automated "Safety
Navigator" system
67,808 person-courses of
training were completed by MMK
Group employees
44,633 people had pre-shift
briefings
LTIFR decreased by 6% year-
on-year
151 calls to the Security
Director hotline
Investors
Capitals:
- Financial
1, 3, 4, 5, 6, 7,
11, 12, 13, 14
− Share price growth and
stable dividend income
− Financial and operational
performance
− Efficient practices and high
standard of corporate
governance and risk
management, including
sustainability
− Implementation of MMK’s
Development Strategy
− Prevention of environmental
impact from projects
− Implementation and
certification of the OHS
Management System, EMS, and
QMS to ISO standards
− Preparing and publishing
HSE reports
− Social media, news blogs, and
events plan on the Company’s
website
− Annual General Meetings
− The STATUS Online page for
shareholders on the Company’s
website
− Quarterly calls for disclosing of
financial results under IFRS
− Site visits for investors and
analysts
− Annual Investor Day
− Non-deal roadshows
(opportunities for investors to meet
the CEO and senior management)
− Participation in industry
conferences for investors
− Engagement with bank analysts,
credit rating agencies, and ESG
analysts
− In 2021, two
transactions to sell 4.5% of
shares by the majority
shareholder were made, with
free float increased to
20.24%
− MMK took part in 17
investor conferences
− Five non-deal roadshows
hosted
− 236 meetings and calls
with investors held
− On 23 - 24 September,
analysts and investors
visited MMK’s production
facilities
− The MMK Investor Day –
MMK Online was held on
7 December
The aggregate average daily
trading volume of shares on the
Moscow Exchange and London
Stock Exchange grew 2.2 times
compared to 2020.
MMK maintained investment-
grade credit ratings in 2021.
Two investment banks
(Raiffeisen Bank and Sinara
Investment Bank) launched
analytical coverage of MMK
shares.
In June 2021, MMK shares were
included for the first time in the
Moscow Exchange’s monthly
Private Investor Portfolio.
MMK won the Corporate &
Financial Awards for the Best
Management of Investor &
Analyst Relations
(Communicate, UK).
MMK’s top management team
ranked fourth in Institutional
Investor’s 2021 Emerging EMEA
Executive Team ranking

MMK INTEGRATED ANNUAL REPORT
33
Customers
Capitals:
- Manufactured
- Intellectual
- Social and relationship
1, 3, 4, 5, 6, 7,
13, 14
− Quality of products,
customer journey, and
customer focus
− Orders delivered on time
and in full, accurate delivery
− New products
− Safe manufacturing,
packaging, storage, and
transportation of products
− Accident-free operation of
equipment, buildings, and
structures
− Financial performance and
market presence
− Integrating sustainability
principles in the Company’s
operations
− Low-carbon and energy-
efficient production
− Certification of quality
management systems at MMK and
its subsidiaries
− Operation of the Unified
Information System for the
Management of Corrective Measures
Based on Inspection Results
− Annual surveys to measure
customer satisfaction and collect
feedback
− The iCIient MMK mobile app
− Implementation of a
project to set up just-in-time
delivery
− Development of a
corporate marketplace
− Holding coordination
meetings with consumers
72% OTIF (percentage of
deliveries completed on time
and in full)
The volume of steel supplies to
the Russian shipbuilding
industry increased by 1.5 times
Consolidated sales of steel
products increased by 16%
Suppliers and
contractors
Capitals:
- Natural
- Social and relationship
7, 12, 13, 14
− Fair and transparent
procurement process
− Delivering on all contractual
obligations
− Promoting safety culture
− Business ethics and anti-
corruption measures
− Securing outsourced HSE
processes
− Formalising tender procurement
procedures
− Electronic trading platform
− Open Days and supplier
conferences
− The MMK Supplier mobile app
for suppliers
− Efforts to prevent hazards in the
workplace
− Automated system "Electronic
work permit"
− Implementation of the
Supplier Relationship
Management (SRM) system
project
− Implementation of an
automated system for
checking subcontractors
0.95 LTIFR among contractors
71% of locally sourced supplies
Local communities
Capitals:
- Financial
- Natural
- Social and relationship
2, 5, 6, 7, 8, 12,
14
− Financial performance and
market presence
− Social stability in the host
region
− Investments in regional
development
− Safe working conditions and
protection of the environment
− Enhancing environmental
performance
− Diversifying the economy in
operating regions and creating
new jobs
− Willingness to cooperate
with local communities
− Accessibility (transparency)
and reliability of information
− The Magnitogorsk Metal
newspaper, local TV programmes
and radio stations
− Phone calls and letters to the
corporate media office
− MMK’s website and social media
− Implementing external social
programmes and projects aimed at
developing operating regions
− Supporting SMEs through MMK
Industrial Park
− Continuing the
Prityazhenie project for the
construction of a
multifunctional park space
− Providing aid to children
as part of the ‘21st Century-
the Children of South Urals’
project
− Holding winter sports
competitions
− Launch of MMK’s new
corporate website
$16.3 m investments in local
development and philanthropy
5.8 units Comprehensive Air
Pollution Index (CAPI) of
Magnitogorsk

MMK INTEGRATED ANNUAL REPORT
34
Government bodies
Capitals:
- Financial
- Human
- Social and relationship
2, 3, 4, 5, 6, 7, 8,
12, 14
− Financial performance and
market presence
− Legal compliance, including
with the anti-corruption
legislation
− Regional social and economic
development and employment
− Timely payment of taxes in
full
− Improvement of legislation
− Innovation and R&D
− Meeting environmental
commitments
− Entering into agreements on
social and economic cooperation
− Monthly discussions of legislative
initiatives and other relevant issues
between MMK specialists and local
Magnitogorsk officials
− Implementation of external social
programmes and projects for the
development of areas where MMK
operates
− Involvement in public
discussions of draft laws and
regulations initiated by the
authorities
− Active involvement in the
implementation of the
national Ecology project and
the federal Clean Air l project
− Accession to the Anti-
Corruption Charter of the
Russian Union of
Industrialists and
Entrepreneurs
$816 million payments to the
state budget on the accrual
basis
A2 level in the Anti-Corruption
Ranking of Russian business by
the Russian Union of
Industrialists and Entrepreneurs

MMK INTEGRATED ANNUAL REPORT
35
FINANCIAL CAPITAL
Undoubtedly, the ongoing global business recovery and the resulting growth in demand for steel
products had a major impact on the results of the past year. In 2021, we achieved an impressive
performance, conquering several new records. We continued to adhere to our prudent financial and
capital allocation policies, delivering strong total returns to our shareholders. Our performance in 2021
demonstrates the soundness of our strategic route and management's effective decisions on the path
to achieving our key strategic goals.
12.5mt
TOTAL SALES OF FINISHED PRODUCTS
2020: 10.8mt
$11,869m
GROUP REVENUE
2020: $6,395m
$400/t
SLAB CASH-COST
2020: $269/t
CORE SDG'S:
MATERIAL ISSUES: 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14
LINK TO STRATEGY: To be the best supplier
TRADE-OFF: Focus on sustainable and organic growth without the need
for costly corporate activities, in particular mergers and acquisitions
(in iron ore) and divestitures (in coking coal) in the raw materials
sector.
$4,290m
EBITDA
2020: $1,495m
MMK’s stable economic and operating performance ensures the development of the regions
where it has a presence. MMK fully meets its obligations to stakeholders and creates additional
stakeholder value. Balancing corporate and shareholder interests, MMK builds a strong investment
case and drives stable economic growth. In the main region where it has a presence, the Company is
a backbone enterprise and, as such, it determines the socio-economic situation and well-being of many
residents. MMK’s and Group companies’ operations impact the region’s economy by providing
employment, purchasing goods and services from local suppliers, and implementing social projects. All
Group entities regularly pay taxes to the local budget.
Direct economic value generated and distributed, $m
2019
2020
2021
1. Direct economic value generated
7,591
6,420
11,899
Revenue
27
7,566
6,395
11,869
Income from financial investments
28
24
23
28
Income from sales of tangible assets
1
2
2
2. Economic value distributed
-7,543
-6,332
-10,299
Operating expenses
-6,292
-5,453
-8,116
including payroll and insurance premiums
28
-776
-718
-774
Payments to capital suppliers
-935
-649
-1,346
including dividend payout
28
-907
-623
-1,321
including finance costs
28
-28
-26
-25
Taxes
-288
-200
-816
including income tax
28
-255
-167
-787
including other taxes
28
-33
-33
-29
Investment in local communities
-28
-30
-21
3. Economic value retained
48
88
1,600
27
Based on IFRS consolidated financial statements of MMK and Group companies.
To be a leader in operational
excellence

MMK INTEGRATED ANNUAL REPORT
36
CAPITAL ALLOCATION
Our approach to capital allocation is driven by our core strategic goal of maximising shareholder
return while creating a sustainable future.
Efficient investment program
Our investment portfolio to 2025 is for the most part focused on projects enabling us to deliver:
- output growth, product mix enhancement, and cost leadership;
- strong environmental performance.
Output growth, product mix enhancement, and cost leadership
Last year’s upgrade of Hot-Rolling Mill 2500 allowed us to take advantage of favourable market
conditions and contributed to our stellar operational and financial performance. The ramp-up of Hot-
Rolling Mill 2500 to full capacity in 2021 enabled us to increase the output of hot-rolled products by 2
million tonnes over 2020.
In mid-2021, we restarted the electric arc furnace facility with a casting and rolling module at
Steel Turkey segment following a suspension caused by economic headwinds in 2012. The facility
restart increased MMK Group sales by 300 thousand tonnes in 2021, expanded the presence of MMK
Group products in global markets, and made a tangible contribution to our financial and operating
performance. The asset is expected to ramp up to its maximum production capacity of 2 million tonnes
per year by the end of 2022.
The iron ore tailings beneficiation line, which allows for production waste reuse in the production
process, cut the purchase volume of third-party iron ore by more than 400 thousand tonnes per year.
Transparent investment projects execution and EBITDA delivery, $m
Focus on the environmental performance of investment projects
In 2021, we reduced CO
2
emissions by 11% to 1.95 tonnes of СО
2
per tonne of steel. Our
strategy to reduce MMK’s carbon footprint by 2025 will enable a further reduction in specific CO
2
emissions by 10% to 1.8 tonnes of СО
2
per tonne of steel through landmark projects such as Coke-
Oven Battery No. 12 and Blast Furnace No. 11. Together, these projects will enable an overall reduction
of greenhouse gas emissions by 2.7 million tonnes per year.
At the end of 2021, we adjusted our capital investment plans to 2025 and now expect an
average annual investment to total $1,250 million, up from the previously announced $950 million.
9
15
24
220
390
610
15
50
65
26
325
351
2020-2021 гг. PLAN
2022-2025 гг.
TARGET
2025 г. TARGET
Superior product portfolio
Customer focus
Leadership in production efficiency
Excellence in procurement and
supply chain management
пустышка
270
780
1,050

MMK INTEGRATED ANNUAL REPORT
37
Capital expenditure grew primarily due to increased investment in green technology, in particular due
to a change in plans to build a blast furnace, shorter project timeframes, and a number of
macroeconomic factors such as accelerated inflation and depreciation of the national currency.
Revised CAPEX plan for 2022–2025, $m
Strong free cash flow generation
MMK continues to generate strong free cash flow ($1,613 million for 2021) while maintaining a
high level of available liquidity ($3.1 billion as at 31 December 2021), which provides the Group with
a generous cushion to allow it to deliver on its strategic commitments. The MMK Group’s debt
repayment schedule is comfortably spread out to 2024 and beyond while the average cost of debt is
2.6%. MMK’s leverage remains among the industry’s lowest with the Net Debt to EBITDA ratio of –
0.09x as at the end of the 2021 (2020: –0.06x).
We maintain our net working capital turnover at a high level to ensure the sustainability of our
business and maximise cash flow. The Company’s long-term goal is to keep the Net Working Capital
to Revenue ratio below 11%–13%.
Credit ratings at or higher than the sovereign rating
28
:
BBB
Standard & Poor’s
Baa2
Moody’s
BBB
Fitch
28
As of 31.12.2021.

MMK INTEGRATED ANNUAL REPORT
38
Reliable dividend payouts are a key element of our operations
The Group consistently generates sufficient cash flow to meet its commitment to the dividend
policy. The Group’s policy stipulates paying out not less than 100% of free cash flow, subject to Net
Debt/EBITDA below 1.0x.
Dynamics of dividend payments for five years
29
FINANCIAL REVIEW
Sales in tonnes
Being a leader in the Russian market, the Group maintained strong sales to the domestic
market. In 2021, sales to the domestic market (including the FSU) accounted for 72% of the Group’s
sales; this was supported by global economic recovery and continuing economic growth in Russia,
which contributed to increased demand from the construction and automotive industries, machine and
railcar building. The share of exports in 2021 increased up to 28% thanks to stronger exports of hot-
rolled products amid full capacity utilisation of Hot-Rolling Mill 2500 and recommissioning of steel
production and hot-rolling facilities at Steel Turkey segment in mid-2021. Sales to the Middle East,
Europe and Americas increased amid strong demand for metal products in these regions.
29
The ratio of dividends accrued to the market capitalisation of the company at the end of the period.
81%
72%
19%
28%
2020 2021
Group's sales by market, %
Exports
Domestic market
(Russia+FSU)
0.05
0.09
0.08
0.05
0.11
6.2%
14.1%
12.2%
7.1%
11.5%
10,755 ths tonnes
12,480 ths tonnes
520
1,007
911
591
1,218
2017 2018 2019 2020 9M 2021
Dividends
Dividends per
share, $
Dividend yield
30

MMK INTEGRATED ANNUAL REPORT
39
Sales to international markets by region, %
30
Revenue
In 2021, the Group’s revenue increased by 85.6% year-on-year to $11,869 million, reflecting
higher sales due to the completion of Hot-Rolling Mill 2500’s modernisation and an upward trend in
global price indices on the steel market.
Revenue by segment, $m
Segment
2020
2021
Change
Steel Russia
5,972
11,100
5,128
Steel Turkey
518
1,184
666
Coal-mining
179
445
266
Eliminations
-274
-860
-586
Total
6,395
11,869
5,474
30
Northern, Central, Latin America and Australia.
36%
41%
35%
19%
17%
23%
12%
9%
1%
9%
2,083 ths tonnes
3,438 ths tonnes
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
0%
20%
40%
60%
80%
100%
120%
2020 2021
Other
Africa
EU
Asia and Far East
Middle East
31

MMK INTEGRATED ANNUAL REPORT
40
Cost of sales and slab cash cost
The cost of sales was 49.8% higher, year-on-year, at $7,028 million, with slab cash cost up
48.8% y-o-y to $400 per tonne, reflecting a surge in the prices for key raw materials driven by
macroeconomic trends.
Slab cash-cost, $/t
EBITDA
In 2021, EBITDA more than doubled year-on-year to $4,290 million, reflecting stronger revenue
and a low base in 2020. EBITDA margin was up 12.8 p.p. to 36.1%. The steel Russia segment’s EBITDA
more than doubled year-on-year to $3,909 million reflecting positive dynamics of demand and market
quotes. The Turkish steel segment’s EBITDA for 2021 totalled $203 million, almost six times up from
the previous year’s low base, backed by stronger steel demand and favourable global market
conditions. The coal mining segment’s EBITDA grew to $235 million thanks to higher coal concentrate
prices and sales amid the global market recovery.
EBITDA by segment, $m
Segment
2020
2021
Change
Steel Russia
1,440
3,909
2,469
Steel Turkey
34
203
169
Coal-mining
13
235
222
Eliminations
5
-57
-62
Total
1,492
4,290
2,798
20%
21%
18%
23%
17%
21%
10%
13%
34%
21%
129
9
2
-9
269
400
0.00
50.00
100.00
150.00
200.00
250.00
300.00
350.00
400.00
450.00
500.00
Other
Scrap
Coal concentrate
Pellets
Iron ore
2020
2021
+48.8%
Raw material
prices
Raw material
mix
Other
FX effect

MMK INTEGRATED ANNUAL REPORT
41
10.1%
10.5%
Working capital
Working capital at the year-end 2021 increased to $1,432 million amid an upward global price
dynamic. The management team’s successful efforts to optimise working capital have reduced the
pressure of higher input costs and steel prices, which resulted in a marginal increase in the ratio of
Net Working Capital to Revenue for the last three months to 10.5% at year-end 2021.
Net Working Capital dynamics
CAPEX
The Group’s CAPEX for 2021 increased by 63,1% year-on-year to $1,132 million, mainly driven
by further project developments pursued under the Group’s strategy. Other main factors which affected
CAPEX were the depreciation of the rouble and inflationary pressure on the back of global market
trends. Growth projects accounted for 67% of CAPEX.
In mid-2021, the Group completed the reconstruction of Cold Rolling Mill 1700, providing a
valuable boost to the cold-rolled production capacity and premium product portfolio.
Considering positive market dynamics, we recommissioned EAF and hot-rolling facilities at the
Steel Turkey segment in July 2021. The project is expected to ramp-up hot-rolled production up to 2
million tonnes per year starting 2023 and amplify our positions on growing global markets. This project
will allow our Turkish asset to gain a significant increase in EBITDA.
We continued the construction of our new coke and by-product plant with ongoing construction
and installation works for foundations, with more than 15 thousand m
3
of concrete already cast. The
primary coolers of the by-product recovery plant have been installed.
In addition, we signed a contract on construction of the Blast Furnace No. 11 coupled with
SYNGAS technology. The project implementation will allow us to sizeably decrease CO
2
emissions by
1.7 million tonnes per year.
CAPEX breakdown, $m
381
757
313
375
694
1,132
2020 2021
745
1,432
2020 2021
NWC to Revenue L3M ratio
NWC, $m
Maintenance
Development

MMK INTEGRATED ANNUAL REPORT
42
-0.06
-0.09
FCF
The Group’s FCF almost tripled year-on-year to $1,613 million, reflecting a favourable global
market dynamic amid ongoing global economic recovery and 2020 year’s low base. This was the
highest FCF for the Group’s over its history.
Free cash flow, $m
Debt
The Group’s total debt for 2021 was $971 million, flat year-on-year. As at the end of 2021, the
Group held $1,364 million in cash and deposits in its accounts, an amount that fully covers its debt.
The Group’s net debt for 2021 totalled minus $393 million, while its net debt/EBITDA ratio was –0.09x,
the lowest among leading global steelmakers.
The average cost of debt was 2.6% at the end of 2021. The Group’s substantial cash balances,
coupled with $1,771 million of available credit facilities, provide the Group with a significant liquidity
cushion.
Total Debt and Net Debt / EBITDA ratio dynamics
2022 PRIORITIES
In 2022, we will continue to implement our investment programme aimed at providing
leadership in operational efficiency, expanding our premium product line, and improving safety and
environmental performance. A prudent financial policy, along with a strong financial position and
sufficient liquidity cushion, will support the implementation of this programme.
1,492
EBITDA
2020
2,745
4,290
– 757
– 28
– 738
– 25
– 1,132
1,613
EBITDA
2021
Working capital
Finance costs
Income tax
Other
Net cash from
operating
activities
CAPEX
FCF
970
971
2020 2021
Debt, $m
Net Debt to EBITDA 12M
ratio

MMK INTEGRATED ANNUAL REPORT
43
MANUFACTURED CAPITAL
We have outstanding expertise in downstream processing of rolled steel; MMK’s operations
include a large steel-producing unit encompassing the entire production chain, from extraction and
processing of raw materials to production of high-tech and premium products. For 90 years now, MMK
has focused on turning out a broad range of metal products, making use of state-of-the-art technology
and equipment.
10.4mt
PIG IRON
2020: 9.3mt
13.6mt
CRUDE STEEL
2020: 11.6mt
12.5mt
METAL PRODUCT SALES
2020: 10.8mt
CORE SDG'S:
MATERIAL ISSUES: 1, 3, 4, 5, 6, 7, 13, 14
LINK TO STRATEGY:
TRADE-OFF: Restart of steel production activities at the Steel Turkey
segment.
5.2mt
PREMIUM PRODUCTS
2020: 5.1mt
3.4mt
COKING COAL CONCENTRATE
2020: 3.1mt
2021 was a year of overall market recovery and robust demand for metal products around the
world. The completion of Hot-Rolling Mill 2500’s upgrade in 2020 and the launch of an electric arc
furnace facility with a rolling module at our Turkish operation in July 2021 enabled us to significantly
improve our operating results and meet the growing market demand. Production growth and
favourable market conditions contributed to an increase in export sales. At the same time, we
confidently maintain our leading position in the market for Russian flat steel, offering high-quality
products and efficient customer service. MMK remains a market leader, operating as a highly efficient,
low-cost manufacturer of metal products, placed in the first quartile on the global cost curve.
In 2021, the MMK Group’s steel output grew by 17.4% year-on-year to 13,592 thousand tonnes,
while its sales of metal products increased by 16.0% year-on-year to 12,480 thousand tonnes. These
increases were driven by favourable market conditions and the high utilisation rate of Mill 2500
following its modernisation in 2020. Sales of premium products were up by 1.3% year-on-year to
5,211 thousand tonnes amid strong demand for galvanised steel in export markets.
To be a leader in operational
excellence

MMK INTEGRATED ANNUAL REPORT
44
Metal products production and sales, thousand tonnes
Indicator
12M 2021
12M 2020
%
Crude steel production
13,592
11,574
17.4
Steel segment Russia
13,278
11,574
14.7
Steel segment Turkey
314
–
–
Pig iron production
10,420
9,344
11.5
Coal concentrate production
3,445
3,059
12.6
Iron ore production
2,913
2,893
0.7
Finished products sales:
12,480
10,755
16.0
Slabs and billets
194
20
885.5
Long products
1,161
1,275
–9.0
Flat hot-rolled products
5,914
4,317
37.0
Premium products:
5,211
5,143
1.3
Thick plate (Mill 5000)
829
841
–1.4
Flat cold-rolled products
873
889
–1.8
Downstream products, including:
3,509
3,414
2.8
Tinplate
169
168
0.1
Galvanised steel
1,992
1,735
14.8
Polymer-coated steel
614
717
–14.3
Band
137
130
4.9
Formed section
76
122
–38.1
Pipe
72
83
–13.2
Metalware
438
418
4.8
Other metal products
11
39
–72.2
Share of premium products
41.8%
47.8%

MMK INTEGRATED ANNUAL REPORT
45
A COMPREHENSIVE PRODUCTION PROCESS
Premium products
Coal
concentrate
Coke
Pellets
Sinter
Thick plate
(Mill 5000)
Blast
furnaces
Slabs
Other downstream
products
Tin plate
Polymer-
coated steel
Metalware
4.9 mtpa
(1)
4.2 mtpa
5.4 mtpa
6.4 mtpa
11.3 mtpa
10.3 mtpa
2.0 mtpa
10.5 mtpa
10.5 mtpa
0.2 mtpa
13.0–13.7
mtpa
(2)
1.2 mtpa
0.6 mtpa
1.9 mtpa
Hot-rolled
products
Galvanised
steel
Cold-rolled
products
Long
products
3.0 mtpa
Iron ore
concentrate
8.9 mtpa
1.3 mtpa
Recyclables
1.6 mtpa
Iron ore
equivalent
Electric arc
furnaces
Double-hearth
furnace
6.0 mtpa
Basic oxygen
furnaces
Slabs
1.1 mtpa
4.8 mtpa
3.0 mtpa
M
Raw materials
Production
Products
Primary
Secondary
Pig iron
Steel
Finished
Semi-finished
2.0 mtpa
Casting and rolling
module
2.0 mtpa
Scrap metal
Billets
T
Note: (1) The production process diagram shows the annual capacity of each production unit (2) 11.7 million tonnes when Hot-Rolling Mill 2500 reaches its projected production capacity of
5.2 million tonnes per year.
● Formed section – 0.8 mtpa
● Band – 0.3 mtpa
● Pipe – 0.1 mtpa
● Other metal products

MMK INTEGRATED ANNUAL REPORT
46
RAW MATERIALS
Market review
Iron ore market
Average annualised raw material prices surged to ten-year highs during the year, with the base
price index for iron ore (62% Fe) up by more than 46% to about $159 per tonne amid high demand
for steel globally.
The Chinese government capped pig iron and steel output in 2021 at 2020 levels and from
August 2021, its steel output decreased by 20% year-on-year which reflected in iron ore price
correction at the year-end.
Demand for iron ore in the Russian market was strong in the first half of 2021 and early in
2021, Russian producers of raw materials saw an increase in orders both in Russia and in the key
export markets: EU countries and Turkey. Exports of Russian iron ore to China shrank markedly in
2021, a shift particularly visible in the exports of premium iron ore from Russia.
Source: Bloomberg
Scrap metal market
Demand and prices for scrap showed different dynamics, with market prices being particularly
high in Turkey, the USA and Japan. For most of 2021, Russia imposed increased duties on scrap exports
outside the Eurasian Economic Union (EAEU), but domestic competition prevented prices from falling
markedly.
Coking coal market
Global coking coal markets saw dramatic shifts in trade flows in 2021 as China stopped
importing coals from Australia in late 2020 (nearly 50% of Chinese imports). As a result, Chinese
imports of coking feedstock were down 25% year-on-year, supporting an upward trend in prices which
were up 135% year-on-year. Raw material supply shortages were most acute in Q3 2021.
In Russia, there was no risk of physical shortages of raw materials in 2021, but domestic prices
increased rather rapidly following the global market trends.
Source: Bloomberg
40
60
80
100
120
140
160
180
Iron ore index CIF China, USD/t
50
100
150
200
250
300
350
400
Coking coal CIF China, USD/t

MMK INTEGRATED ANNUAL REPORT
47
As a result of global market trends, the Group’s cost of sales increased substantially, although
we mitigated this thanks to our long-term relationships with our key suppliers.
The Group’s raw materials assets
Iron ore
Self-sufficiency: 17%
Production capacities: iron ore production – 2.4 mtpa
Iron content in rich iron ore: 48%
Iron content in lean iron ore: 31%
Our iron ore mining unit is based in Magnitogorsk. It mines produce rich and lean iron ores,
both of which are used in sinter production.
Rich iron ore is used directly in sinter production, whereas lean iron ore is used in production
of sinter after the beneficiation process to remove impurities.
Production of iron ore for 2021 stayed flat year-on-year at 2,913 thousand tonnes.
Owning an iron ore asset, combined with effective processing of recycled material, helped the
Company mitigate the negative impact of upward trends in iron ore pricing in 2021. At the same time,
considering the decline in iron ore prices expected by many market players in the longer term, MMK is
well-positioned compared to more integrated producers.
Scrap metal and recyclables
Self-sufficiency: 65%
Scrap collection: 1 mtpa
MMK is a leader in scrap collection and recycling. The use of scrap and other recyclables in the
production process can significantly reduce greenhouse gas emissions. Our scrap collection and
recycling facilities as well as the recycling of steelmaking waste provide us with a prime source of
environmentally-friendly iron for a sustainable and green future.
In 2021, we increased our scrap collection by 32%. We also ramped up our recycling of
secondary iron-containing resources by 4% year-on-year to 1.6 million tonnes.
Coking coal
Self-sufficiency: 40%
Production capacities:
- Coking coal mining – 5 mtpa
- Beneficiation – 6 mtpa
Coal reserves: 273 mt
Capacity utilisation rate: 96%
Meeting MMK’s demand in Zh grade coking coal
In 2021, coking coal production increased by 13.2% year-on-year to 5 million tonnes, driven
by MMK’s growing demand and in accordance with mining plan.
The 12.6% year-on-year increase in concentrate production to 3,445 thousand tonnes was due
to a stronger demand from the Magnitogorsk site.
Water reuse
The launch of effluent polishing facilities at one of the coal mines in 2021 enables us to clean
harmful impurities (suspended particles, heavy metals, organic compounds, etc.) from mine water

MMK INTEGRATED ANNUAL REPORT
48
and, consequently, reduce the environmental impact. The concentration of suspended particles in
wastewater will be reduced by 45.5%.
Phase 2 of the water treatment facilities will be commissioned in 2023, and Phase 3 in 2024.
The throughput of the water treatment facilities will double, and water quality will meet the most
stringent requirements.
How we integrate sustainability into our business processes
- Increasing the share of scrap metal used in steelmaking;
- Using waste from various metallurgical processes in sinter charge;
- Improvement of coke and chemical operations through construction of a new coke battery
No. 12 and decommissioning of outdated equipment with CO
2
decrease by 1.1 million tonnes per year.
PRODUCTION
Global market
Steel production and consumption
In 2021, the global market continued to be affected by the constraints of the ongoing global
COVID-19 pandemic and the global economic crises, which led to high volatility in demand and prices
in commodity markets. Throughout 2021, the USA and Europe continued the monetary policies they
started in spring 2020, which bolstered prices for resources, including for rolled steel, and fuelled
inflation. At the beginning of Q3 2021, the state of global markets for rolled steel started to deteriorate
in most regions. The downturn in the markets was driven by pandemic-related restrictions, weaker
demand or exhausted quotas in some markets, as well as by the summer slowdown in business activity.
Workforce shortages were a key issue induced by the pandemic in 2021 and this had a major impact
on logistics and delivery times for goods. The marine shipping sector faced an abrupt downturn, with
shipping and freight rates on a number of routes hitting record levels. At the end of the year, the
economic situation was exacerbated due to energy resources shortages and rising energy costs.
According to the World Steel Association (worldsteel), global crude steel output increased by
3.7% to 1,950.5 million tonnes over 2021 amid pent-up demand. The association estimates that
apparent steel use (ASU) for 2021 will grow 4.5% to 1,855.4 million tonnes over the year.
Global steel production, million tonnes
Source: WSA
In 2021, Asia produced 1,382 million tonnes of steel, up 0.6% year-on-year.
In 2021, steel production in China decreased by 3% year-on-year to 1,033 million tonnes. The
Chinese economy has continued its strong recovery momentum from 2020 into early 2021. In 1H
2021, China saw a rise in output and demand, fuelled by strong consumption across its industries on
the back of the government’s economic stimulus programmes. In 2H 2021, output slowed significantly,
reflecting a number of factors such as the Chinese policy to maintain production rates at last year’s
level, rising prices for raw materials, the downward trend in the real estate and automotive markets,
the global energy crisis and environmental restrictions. Steel exports from China increased by 25% to
0
300
600
900
1200
1500
1800
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
1,800
1,500
1,200

MMK INTEGRATED ANNUAL REPORT
49
66.9 million tonnes, although the Chinese authorities cancelled the refund of VAT (13%) on exports in
the second half of the year to mitigate the shortage of steel products and curb domestic prices. In
2021, steel imports to China decreased by more than 27% to 28 million tonnes.
In 2021, India, the world’s second largest steel producer, ramped up its steel output by 17.8%
to 118.1 million tonnes, at the same time planning new additions to its capacity. This gives rise to
expectations that the Indian steel sector will continue to grow steadily.
US steelmakers achieved high growth rates, increasing their steel output for 2021 by 18.3%
year-on-year to 86 million tonnes due to new capacity coming online, pent up demand being released
and a return to production at most facilities that were shut down in 2020.
In the EU, the recovery of steel demand that began in 2H 2020 continued to gain momentum
in 2021, driven by additional stimulus packages, cheap loans, and the release of pent-up demand.
The EU (27-member states, excluding the UK) produced 152.5 million tonnes of steel for 2021,
up 15.4% year-on-year.
Steel prices
In 2021, steel prices were affected by the pent-up demand, acute shortages of metal products,
and rising prices for raw materials and energy. Global prices for rolled steel soared in 2021 to hit or
even exceed the 2008 highs for hot-rolled products. At the end of 2021, markets were strongly affected
by uncertainties caused by the resurgent pandemic and the emergence of new virus strains.
Hot-rolled coil FOB, USD/t
Source: Bloomberg
Hot-rolled coil FOB, USD/t
Source: Bloomberg
300
400
500
600
700
800
900
1000
1100
1200
Jan
Mar
May
Jul
Sep
Nov
Jan
Mar
May
Jul
Sep
Nov
Jan
Mar
May
Jul
Sep
Nov
2019 2020 2021
Russia China
200
400
600
800
1000
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Russia China
1,200
1,100
1,000
1,000

MMK INTEGRATED ANNUAL REPORT
50
Russian market
Demand and prices for metal products
The Russian economy grew at a 4.7% rate in 2021, its fastest pace in recent years.
Russia’s economy was mainly driven by the post-pandemic recovery, which started in the
second half of 2020 and continued into 2021. Against this backdrop, the metal products market
followed the overall trends, albeit with its inherently higher volatility. The tailwinds included relatively
high oil prices in the absence of external shocks, as well as factors such as demand recovery in Russia
bolstered by a boom in consumer lending, and the government supporting economic growth through
significant allocations to previously planned national projects and various state programmes, exceeding
the previous year’s levels.
During the fourth quarter of 2021, despite the seasonality, steel consumption hit an all-year
high in the last quarter, showing quarter-on-quarter growth of +16% and more than +11% over the
same period last year. Thus, during FY 2021 the apparent consumption of metals in Russia was up by
just 3.8% year-on-year, exceeding expectations.
Apparent consumption and metal products prices in Russia
Source: Metal Expert, MetalTorg.Ru
Market share by company in Russia in 2021, %
Source: Metal Expert
16.9%
12.7%
10.0%
4.9%
55.5%
MMK
Peer A
Peer B
Peer C
Other
10.97
12.36
11.07
12.88
-15%
-5%
5%
15%
25%
35%
45%
1 кв. 2 кв. 3 кв. 4 кв.
Видимое потребление
2020, млн тонн
Видимое потребление
2021, млн тонн
Динамика цен
производителей
(к пред. периоду), %
Q1
Q2
Q3
Q4
Apparent
consumption in
2020, mt
Apparent
consumption in
2021, mt
Producer prices
(quarter-on-
quarter change), %

MMK INTEGRATED ANNUAL REPORT
51
The Group’s production
Pig iron
Production capacities: 10.5 mtpa
Utilisation rate: 100%
Pig iron production is supported by eight blast furnaces within the Magnitogorsk production site
with an aggregate capacity of 10.5 million tonnes of pig iron per year.
In 2021, we increased pig iron output by 11.5% year-on-year to 10,420 thousand tonnes as
there were no lengthy overhauls of blast furnaces.
Pig iron output, thousand tonnes
Source: Company data
Crude steel
Production capacities: 16.5 mtpa
Utilisation rate: 89%
Steel production capacities include three converters and two electric arc furnaces at the
Magnitogorsk site and one electric arc furnace at the Steel Turkey segment.
Annual steel output increased by 17.4% year-on-year to 13,592 thousand tonnes, as no
overhauls took place at converter facilities, and the electric arc furnace facility was launched at the
Turkish operation.
Steel output, thousand tonnes
Recomissioning of electric arc furnace production in Turkey
In July 2021, we resumed steel and hot-rolled coil production at our operation in Turkey, which
was halted in 2012 due to an unfavourable economic environment in the Turkish market. The phased
10,163
9,860
10,013
9,344
10,420
7,000
8,000
9,000
10,000
11,000
2017 2018 2019 2020 2021
12,860
12,664
12,463
11,574
13,592
9,000
9,500
10,000
10,500
11,000
11,500
12,000
12,500
13,000
13,500
2017 2018 2019 2020 2021
11,000
10,000
9,000
8,000
7,000
13,500
13,000
12,500
12,000
11,500
11,000
10,500
10,000
9,500
9,000

MMK INTEGRATED ANNUAL REPORT
52
commissioning of the electric arc furnace facility with a casting and rolling module at the Steel Turkey
segment implies a gradual ramp-up in production. We produced a total of 305 thousand tonnes of hot-
rolled steel in 2021 and plan to ramp up to the design capacity of 2 million tonnes by the end of 2022.
How we integrate sustainability into our business processes
- Improvement of blast furnace operations with reduction of natural gas consumption and
injection of secondary products of production (synthesis gas) as fuel with further capture and storage
of greenhouse gases (CCUS);
- Improvement of energy efficiency through enhancement of the energy management system
and implementation of technical measures;
- Evaluation of the feasibility of using energy generated from renewable energy sources;
- Increasing the share of re-circulating and repeated use of water and the effluent quality;
- Improvement of processes for monitoring and controlling air emissions from key sources.
METAL PRODUCTS
Market review: demand across key Russian industries
Construction
In 2021, the construction industry was steadily building momentum. The massive residential
construction sector showed strong demand due to the government’s subsidised mortgage programme,
the implementation of national projects, and the overall economic recovery. The amount of
construction grew 6% year-on-year in comparable prices. New builds for the same period measured
92.6 million m2 overall, up by a record 12.7% from the previous year.
Automotive industry
The output of motor vehicles in Russia was up 9.1% year-on-year. This growth was driven by
the release of pent-up demand and the low base in 2020. In the second half of 2021, the growth
slowed down due to production bottlenecks caused by a semiconductor shortage.
Pipe industry
In 2021, the output of welded pipes dropped 3% year-on-year. Around mid-2021, the
production of large-diameter pipes (LDP) began to recover. In the fourth quarter, production of LDP
increased by 10.8% quarter-on-quarter. In 2021, pipe production increased by more than 25% to
almost 2.3 million tonnes. This growth was due to the launch of new Gazprom projects. Pipes were
mainly shipped for the construction of the Kovykta–Chayanda section of the Power of Siberia 1 pipeline
and infrastructure development in the North-West region. Against this background and due to the
switch of consumers to use seamless pipes, production of other welded pipes for the fuel and energy
sector stagnated. Shipments of construction pipes also declined, although, according to experts, the
fall is transient and, given the positive forecasts for the construction sector, the construction pipe
market is set to recover.
Railcar manufacturing
For 2021, the output of freight cars grew 3.5% year-on-year, prompting an increase in
purchases and production of new freight cars. There was increased demand for open railroad freight
cars and fitting platforms for export shipments, the main volume of which was represented by cargoes
of coal companies amid favourable global market conditions.

MMK INTEGRATED ANNUAL REPORT
53
Changes in Russia’s metal consumption by industry, %
Source: Metal Expert, Company data
MMK shipments by sector in Russia, %
Source: Company data
MMK firmly occupies its niche in the Russian steel market and has consistently ranked among
the top three Russian steelmakers. MMK is well positioned to operate successfully at high margins,
benefiting from its advantageous geographical location in the Russian market and its wide range of
products, including high-margin steel products.
Dynamics and structure of the Russian market for rolled steel, million tonnes
Source: Metal Expert
2.7%
20.2%
12.1%
8.9%
1.8%
3.8%
-28% -18% -8% 2% 12% 22%
Трубная промышленность
Автомобилестроение
Вагоностроение
Машиностроение
Строительство, вторичный рынок
и прочие отрасли
Итого РФ
0% 10% 20% 30%
МЕТАЛЛОТОРГОВЛЯ И СМЦ
ТРУБНАЯ ПРОМЫШЛЕННОСТЬ
МЕТИЗНЫЕ И ПЕРЕДЕЛЬНЫЕ ЗАВОДЫ
СТРОИТЕЛЬНЫЙ СЕКТОР + (ЗМК и ЛСМ)
МАШИНОСТРОЕНИЕ И ПРОЧИЕ ОТРАСЛИ
АВТОПРОИЗВОДИТЕЛИ + АВТОКОМПОНЕНТЫ
МОСТОСТРОЕНИЕ
ПИЩЕВАЯ ПРОМЫШЛЕННОСТЬ
2020
2021
40.76
43.83
44.37
47.09
45.58
47.32
-40
-20
0
20
40
60
2016 2017 2018 2019 2020 2021
Импорт
Внутренние
поставки
Экспорт
2020
2021
Total Russia
Construction, spot market, and
other industries
Machine building
Railcar manufacturing
Automotive industry
Pipe industry
Food industry
Bridge construction
Carmakers and parts
Machine building and other sectors
Construction
Metalware and non-integrated plants
Pipe industry
Metals trading and service
Imports
Exports
Domestic supplies

MMK INTEGRATED ANNUAL REPORT
54
The share of imports in the Russian metal products market for 2021 declined by 16.1% year-
on-year. Imports increased in the segments of galvanised steel (up 20.9%), polymer-coated steel (up
16.2%), and hot-rolled thin sheets (up 15%), with shipments of other metal products down year-on-
year. MMK maintains its leadership in these premium product markets by developing strong
relationships with customers as well as offering a wide range of products and excellent customer
service.
Changes in imports in the Russian market, thousand tonnes
31
Source: Metal Expert
The Group’s products
Long and hot-rolled products
Production capacities:
- long products – 1.9 mtpa
- hot-rolled products – 13-13.7 mtpa
Capacity utilisation rate:
- long products – 94%
- hot-rolled products – 98%
Long products: 1.16 mt sold in 2021, –9.0% year-on-year.
PJSC MMK manufactures long products at its facilities in Magnitogorsk. Its long products are
used by the Group in metalware production and are also supplied to the domestic and international
metalware, construction, machine-building, and other industries.
In 2021, sales of long products decreased by 9.0% year-on-year to 1,161 thousand tonnes
primarily as a result of scheduled repairs of rolling equipment.
Hot-rolled products: 5.91 mt sold in 2021, +37% year-on-year.
Hot-rolled steel is produced at facilities in Russia, and Turkey, and shipped to the Group
companies to manufacture premium products as well as to the domestic and international construction,
machine-building, and many other industries.
In 2021, sales of hot-rolled products grew 37.0% year-on-year to 5,914 thousand tonnes,
reflecting higher production by Hot-Rolling Mill 2500 following its upgrade in mid-2020 and the relaunch
of steel and hot-rolling facilities at the Steel Turkey segment in July 2021 amid favourable global
market conditions.
31
Net of rails.
0 200 400 600 800 1000 1200 1400
Оцинкованный прокат
Полимеры
Толстолистовой г/к прокат
Х/к прокат
Сортовой прокат
Тонколистовой г/к прокат
Жесть белая
2020
2021
Tinplate
Hot-rolled thin sheets
Long products
Cold-rolled products
Hot-rolled thick sheets
Polymer-coated steel
Galvanised steel
1,000
1,200
1,400

MMK INTEGRATED ANNUAL REPORT
55
Premium products
Production capacities: 6 mtpa
Premium products sales: 5.2 mt, +1.3% year-on-year
Capacity utilisation rate:
- Thick plate (Mill 5000) – 99%
- Cold-rolled products – 91%
- Coated steel products
32
– 89%
In 2021, sales of premium products were up by 1.3% year-on-year to 5,211 thousand tonnes.
A marginal 1.4% year-on-year decrease in sales of thick plate by Mill 5000 to 829 thousand
tonnes was due to equipment overhauls during the year. Cold-rolled product sales for 2021 decreased
slightly year-on-year to 873 thousand tonnes. In May 2021, we launched the newly upgraded Cold-
Rolling Mill 1700 at the Magnitogorsk site.
The 14.8% increase in galvanised steel sales in 2021 to 1,992 thousand tonnes was due to
stronger demand both domestically and globally amid positive macroeconomic trends.
Sales of polymer-coated steel for 2021 fell 14.3% to 614 thousand tonnes due to higher margins
from sales of galvanised steel.
Sales of premium products, thousand tonnes
How we integrate sustainability into our business processes
- Aiming to make our own products part of the solution to the challenges of climate change: the
use of thick plates from MMK’s Hot-Rolling Mill 5000 in the construction of the base and supports of
wind-driven generators;
- Development of innovative products with a low carbon footprint - products made of the high-
strength and wear-resistant steels MAGSTRONG.
2022 PRIORITIES
In 2022 we intend to further strengthen our leadership in Russia, which is our priority market,
and maintain our leading position in the premium products market by expanding our product range.
We will continue developing our Marketplace, launched in 2021. Sales exceeded 10 thousand
tonnes in 2021, and we have plans to increase sales through the Marketplace several times over by
diversifying our customer base.
32
Galvanised and polymer-coated steel.
4,253
5,426
5,482
5,143
5,211
2,000
3,000
4,000
5,000
6,000
2017 2018 2019 2020 2021
6,000
5,000
4,000
3,000
2,000

MMK INTEGRATED ANNUAL REPORT
56
We plan to ramp up production of hot-rolled products at the Steel Turkey segment, and expect
to reach full production capacity by the year-end. Overall, we aim to increase our output to 1.6 million
tonnes in 2022.
As a business firmly committed to sustainability, we will maintain our focus on building a culture
of safety at work, making further progress towards our goal of zero-injuries operations. We will also
continue to reduce emissions and water discharges.
The new coke and by-product plant that we are building will reduce both production costs and
our environmental footprint.

MMK INTEGRATED ANNUAL REPORT
57
INTELLECTUAL CAPITAL
We seek to improve our practices using all available instruments and implement an innovative
approach to transforming of our business activities. We take full advantage of the latest technologies
and R&D solutions to increase efficiency and boost our performance as a responsible, sustainable
business. Our Digitalisation strategy represents our commitment to innovation in the realisation of our
projects.
$10m
INCREMENTAL EBITDA INCOME
FROM DIGITALISATION
STRATEGY
$5.5m
R&D SPEND
961 ths tonnes
OF NEW INNOVATIVE
PRODUCTS PRODUCED
CORE SDG'S:
MATERIAL ISSUES: 1, 3, 4, 5, 6, 7, 9, 10, 13, 14
To be the best supplier
LINK TO STRATEGY:
TRADE-OFF: Investments in R&D and digital technologies to reach a
new level of production organization and consumer value creation
4
2 PATENTS GRANTED AND
2 APPLICATIONS FOR AN
INVENTION SUBMITTED
A changing business environment and increasing competition drive the MMK Group to leverage
opportunities in research, technological development, and digitalisation to reduce the negative impact
on the environment, local communities, and MMK employees. The MMK Group’s research and technical
capabilities are aimed at driving product innovation (including products with a low environmental
impact), while our digital initiatives enable process optimisation and transformation, delivering gains
in productivity, safety, and transparency.
In the reporting period, the Digital Committee was established, a governing body responsible
for implementing the Digitalisation Strategy, chaired by the CEO and composed of top managers. The
Committee reviews and vets digital initiatives and projects. The Committee considers and makes
decisions on a whole range of issues related to the digital initiatives and their translation into projects.
It monitors implementation and takes decisions on individual digitalisation projects and the project
portfolio as a whole, updates the MMK Digitalisation Strategy, and addresses methodological and
organisational issues that contribute to the successful implementation of the Strategy.
As a result of resolutions of the Digital Committee, centers of excellence (Internet of Things,
BI, RPA, Machine Learning, and Mobility) were set up within MMK.
In 2021, the Digitalisation Expert Group (DEG) was established to address the challenges of
digital transformation. The key role of the DEG is to generate new digital ideas, conduct comprehensive
expertise of initiatives submitted to the Digital Committee, and form a creative environment that
promotes the active participation of MMK business units’ employees in digital transformation. Led by
the Chief Digital Transformation Officer, it is composed of digital champions and the heads of centers
of excellence. Digital champions represent various units of MMK across 11 business lines and combine
their activities with their main jobs on the shop floor. Their task is to generate and implement new
digital ideas that are subsequently submitted for discussion to the Expert Group and, together with
other matters related to digitalisation, to the Expert Council.
In 2021, regulations governing the activities of collective bodies responsible for digitalisation
(Digital Committee, DEG) were updated and approved. Plans for 2022 include the development and
approval of the Regulations on Managing Digital Projects and the Regulations on Digital Procurement.

MMK INTEGRATED ANNUAL REPORT
58
The Security Director is responsible for organising interactions on information security between
MMK units, with the Information Security Team of the Security Unit reporting to him. The heads of
units designate employees responsible for information security within their teams. The Group’s
standing commission on technical protection of information and automated process control systems
(APCS) coordinates and manages information security at MMK and the MMK Group subsidiaries.
MMK complies with Russia’s legal requirements for critical information infrastructure and
personal data protection. The Chief Executive Officer is responsible for organising personal data
processing. MMK has a standing commission on personal data protection in place, which is chaired by
the Director for Human Resources.
Information security management and personal data protection are governed by a number of
internal documents including standards, guidelines and regulations of MMK and the MMK Group. In the
reporting period, an Information Security Policy was adopted and published on the MMK website in the
Documents of Company section. In December 2021, Guidelines for Assessing Information Security
Risks were approved by the CEO and made effective at the Company.
DIGITALISATION, RESEARCH AND INNOVATION
Digitalisation and innovation
Unlocking the potential of digital technology and innovation is a strategic driver of the MMK
Group’s sustainable growth and development. By combining information and operational technologies
and processes into a unified digital platform, we were able to set up more secure, transparent, and
smart production operations.
The digital platform is a key element of the Company's digital transformation. The digital
platform is a set of components for data collection, storage and management, platform management,
and tools for deploying digital services. Transition to a single platform will enable the Company to
reduce the time (up to 60%) and cost (up to 25%) of implementing digital projects, as well as to
optimise operating costs for supporting digital solutions (up to 20%). The main contributers to these
improvements are an increase in data collection, data quality, structured storage, and the use of special
modules to quickly build digital solutions. The most striking examples are projects in the field of Data
Science using machine learning methods, advanced analytics and Big Data to build predictive and
optimisation mathematical models.
Digital platform is the core of digital transformation at MMK

MMK INTEGRATED ANNUAL REPORT
59
During 2021, we continued to advance our approved projects within MMK’s Digitalisation
Strategy, which includes 197 projects and initiatives. Our 2020–2024 digital portfolio supports the
priority focus areas of the MMK Group’s Development Strategy:
Strategic pillars
Strategic
objectives
Key areas of digitalisation
Number of
digital
projects
To be the best
supplier
- Customer focus
- Superior product
portfolio
- Using Big Data and machine learning to build mutually
beneficial partnerships
- Implementing platform solutions for customer interaction
10
To be a leader in
operational
excellence
Leadership in
production efficiency
- Using mathematical modelling to streamline production
processes
- Predictive analytics to improve maintenance and repair
performance
- Machine vision for product quality control
- Creating digital twins and developing IoT technologies
148
Excellence in
procurement and
supply chain
management
- Unmanned vehicles to optimise internal logistics
- Using Big Data and digital twins to optimise the supply
chain
- Digitisation of supplier relationship management
processes
32
To be a
responsible,
sustainable
business (ESG)
Continually
improving
environmental
performance and
reduction in CO
2
emissions
- ML
33
- gas leak detection of coke batteries
- ML- monitoring accidental emissions
7
Zero injuries
- MV
34
employee tracking in hazardous areas
- MV- monitoring OHS compliance
The estimated economic impact from the digitalisation strategy for 2020–2025, $m
HR management and HSE projects
In the reporting period, the Health, Safety and Environment Directorate implemented a number
of innovative occupational health projects, including the rollout of a system for employee tracking in
hazardous areas within the coke shop. The system’s purpose is to create the safest possible workplaces
through the automation of production processes. The system is innovative in that it detects employees
in hazardous areas (1 to 10 meters away from a moving machine) and sends a signal to perform a
forced shutdown of the equipment. This feature will be implemented in the coke shop by mid-2022
and is also being actively deployed in the blast furnace, electric-arc furnace and basic-oxygen furnace
shops.
33
ML - Machine Learning.
34
MV - Machine Vision.
10
20
30
Incremental EBITDA in 2021 vs
2019
Incremental EBITDA in 2022-2025
vs 2021
Incremental EBITDA in 2025 vs
2019

MMK INTEGRATED ANNUAL REPORT
60
In 2022, it is expected to scale up the occupational health project which was implemented in
the BOF shop in 2021. The project consists in organising daily OHS checks of employees with the use
of face recognition terminals installed in the subdivisions. VR-technologies are implemented at the
MMK Safety School to train employees on occupational safety issues. In the reporting period, the Safety
Navigator system was rolled out to capture hazardous activities and conditions at production sites. The
mobile app will enable shop managers and foremen to capture various OHS breaches and gaps by
taking pictures. As problems are fixed, the system ticks off the checklist, and a weekly report is
generated for the entire enterprise.
The MMK Group leverages innovative solutions to address environmental issues. To this end,
we implemented a pilot project with machine vision technology to capture emissions from coke-oven
batteries and coke shop, as well as from BOF and EAF shops.
In late 2021, we launched an HR management platform to track MMK employees’ career
development and training. In addition, a mobile app for shop-floor staff has been developed and rolled
out to help them keep track of quality and productivity metrics, including OTIF (On Time In Full, the
number of orders fulfilled on time in full in the selected period divided by the total number of orders),
both for the entire plant and for their specific shop area and unit. The app is designed to motivate
employees to meet the MMK Group’s global strategic indicator target
In 2021, we implemented the following digital projects to reduce emissions into the
atmosphere:
ML- gas leak detection of coke batteries
- CAPEX – $0.7m
- Reduction of CO and hydrocarbon emissions – 21%
ML-monitoring accidental emissions
- CAPEX – $0.2m
- Reduction of dust emissions from steelmaking – 24%

MMK INTEGRATED ANNUAL REPORT
61
Cooperation to drive innovation
In 2021, the MMK Group signed 25 new agreements with partners for R&D, production
operations, and pre-feasibility studies. To elaborate digital initiatives, implement digital projects and
R&D, MMK partnered with:
- Nosov Magnitogorsk State Technical University represented by LLC R&D MGTU;
- Skolkovo Innovation Centre (Moscow);
- Innopolis University (Kazan);
- AI Cluster (Novosibirsk).
In the reporting period, the Temporary Procedure for Organising and Implementing R&D,
Production Operations, and Pre-feasibility Studies at MMK with the Involvement of Third Parties was
approved and adopted.
Digital transformation of maintenance and repair operations
MMK continues to implement digital solutions for maintenance and repair. Dedicated systems
are introduced to monitor process equipment maintenance using NFC tags and a system to track
maintenance and repair staff, which enables mapping a dynamic walk-around route. The expected
economic benefits include a reduction in inventory and human resource requirements by up to 3%.
The following maintenance and repair initiatives were launched in 2021:
- Centralisation of weighing procedures (centralised within MMK’s single weighing control
room);
- Digital worker model (employee tracking system);
- The centre for predictive diagnostics of MMK’s process equipment (centralisation of competent
experts in the diagnostic control centre to improve the reliability of process equipment operation and
reduce unplanned downtime).
These projects improve the efficiency of MMK’s equipment repair services and deliver an
additional economic benefit of over $1.15 million.
As part of the Leadership in Production Efficiency strategic initiative, 92 activities were designed
in 2021 to upgrade MMK’s equipment by 2025, aimed at improving equipment performance and
reducing maintenance and repair costs. These initiatives will reduce or eliminate equipment failures by
upgrading production units.
In 2021, a new unit, the Centre for Predictive Diagnostics of MMK’s Process Equipment, was set
up to ensure comprehensive monitoring, diagnostics, and prediction of equipment failures to streamline
maintenance and repair planning. The project will help reduce losses caused by unplanned downtime
of core process equipment by up to 3% and switch to a condition-based maintenance strategy
R&D
The MMK Group’s research and development (R&D) and technology projects cover the entire
value chain, focusing primarily on research into metallurgy and the environment. Research is
consistently aimed at improving the MMK Group’s approaches to process management, optimising the
use of natural raw materials and energy resources, and developing high-tech products.
In 2021, the MMK Group fully achieved its objectives: the Group hit 100% of its targets in
improving technology and developing new types of products, and ensured the completion of all R&D
projects. MMK investments in digitalisation, R&D and rationalisation activity in 2021 was approximately
$5.5 million.
As of the end of the reporting period, 13 projects were fully implemented and closed, with a
total expected economic impact of $669,700 per year. Cluster technology for producing high-strength
cold-rolled and hot-dip galvanised flat-rolled products of different types from steel of the same
chemical composition, a high-tech solution for the automotive industry developed jointly by MMK and
Bardin Central Research Institute for Ferrous Metallurgy, was awarded the gold medal at the 27th
international industrial exhibition Metal-Expo’2021.
MMK pioneered the production of S900MC ultra-high-strength hot-rolled steel coils with wall
thickness from 4.0 to 8.0 mm. The new technology enabled us to meet the entire range of technical

MMK INTEGRATED ANNUAL REPORT
62
requirements for the products. We plan to develop and operationalise technology for manufacturing
new corrosion-resistant hot-rolled coils from new steel grades of strength classes K52–K56.
In addition, during the reporting period, we completed research and development within the
following government-sponsored projects:
- Lines of new multifunctional materials for extreme conditions have been developed (jointly
with the Ministry of Science and Higher Education);
- Technologies have been developed (jointly with the Ministry of Industry and Trade) for
producing breakthrough cold-rolled automotive plates with improved corrosion resistance, surface
quality, and formability for the automotive and other industries.
INFORMATION SECURITY AND CYBER RISKS
In 2021, the Company implemented a number of information protection and cyber risk
mitigation measures.
- It also signed a contract for implementing technology solutions to protect its critical
information infrastructure.
- A total of 25 production units across MMK conducted computer security incident drills.
- The Company signed a service contract for organising and running an internal communications
campaign until April 2022 to raise awareness of information security issues among MMK employees.
- The Company has also implemented a pilot project on mobile device control.
- MMK runs regular campaigns to identify and eliminate vulnerabilities across key data assets.
- Two new personal data information systems have been upgraded with technical safeguards.
In the reporting period, 507 breaches of information security requirements were identified at
MMK (with a total of 649 breaches at the MMK Group). A total of 127 MMK or MMK Group employees
were disciplined over the incidents.
Guidelines on Incident Management in the Corporate Information System of MMK and MMK
Group Subsidiaries set forth the general procedure for employees to respond to suspected information
security / cyber security breaches. MMK also rolled out a Response Plan to Handle and Respond to
Computer Security Incidents and Cyberattacks.
Regular newsletters are sent out to update employees of the MMK Group on the threats of
phishing emails and the rules of handling such letters. Employees can report suspected phishing emails
to a single address at security@mmk.ru.
2022 PRIORITIES
Next year, the MMK Group plans to:
- implement a digital transformation plan focused on boosting idea generation and accelerating
projects;
- develop digital strategies for business segments (metallurgy, rolled products, and
maintenance and repair);
- continue developing the lines of new multifunctional materials for extreme conditions;
- continue developing and operationalising technology for the production of breakthrough cold-
rolled automotive plates with improved properties for various industries;
- launch a project to develop chemical compound and new technologies to produce niobium-
free steel;
- continue protection measures for its critical information infrastructure, corporate network
resources, and APCS networks;
- continue to raise employee awareness of information security issues;
- implement the information security risk management and mobile device control processes.
The Company has established a blueprint for rolling out its Security Operations Centre (SOC), a
computer security centre created to protect and improve the reliability of the MMK Group’s IT
infrastructure.

MMK INTEGRATED ANNUAL REPORT
63
NATURAL CAPITAL
We focus on ensuring environmental safety at all stages of the product life cycle and supporting
global efforts to combat climate change. We are continuously working to improve our environmental
management system, decrease greenhouse gas emissions, and mitigate climate risks. The
implementation of the best available technologies enables us to achieve the established targets related
to responsible environmental practices and climate change.
45.95 mt of CO
2
e
MMK’S GROSS GHG EMISSIONS
(SCOPE 1, 2, 3)
21.81 GJ/t of crude steel
THE GROUP’S ENERGY INTENSITY
5.8
COMPREHENSIVE AIR POLLUTION
INDEX (CAPI)
CORE SDG'S:
MATERIAL ISSUES: 2, 3, 4, 5, 6, 7, 8, 12, 13, 14
LINK TO STRATEGY:
TRADE-OFF: Investments in development in 2022-2025 increased by
30% to $1.25 billion on the back of significant environmental
investments to mitigate any adverse environmental impacts on our
employees and communities
1.7%
REDUCTION IN WASTE GENERATION
ACROSS THE GROUP YEAR-ON-YEAR
The MMK Group supports global efforts to prevent climate change and implements best practices
to reduce greenhouse gas (GHG) emissions. MMK’s Environmental Policy establishes climate-change
commitments at the Group level, with 1.8 tonnes of CO
2
equivalent per tonne of crude steel set as a
2025 target (Scope 1 and 2) in the Group’s Strategy 2025. High energy efficiency and production
upgrades are the key steps taken by the Group to decarbonise its value chain. Offering more innovative
low-carbon products (MAGSTRONG high-strength steel grade) to our customers is also a major action
area.
The MMK Group is committed to identifying and assessing climate-related physical and
transition risks as recommended by TCFD (Task Force on Climate-Related Financial Disclosures)
35
, with
climate risk management made part of the corporate risk management system. Climate risk metrics
are reviewed by the Group’s senior management and considered as a part of business planning, and
specifically in designing climate-action initiatives. Climate agenda is regularly discussed at the Board
meetings to track progress on our announced decarbonisation initiatives.
Environmental safety is a top priority for the Group as we remain committed to embedding
environmental impact minimisation and management into our operations. The MMK Group’s senior
management is closely involved in the review of environmental agenda at the Board and HSE
Committee meetings and keeps track of progress on planned environmental activities. The CEO makes
sure the environmental management system is effective, while the Director for Health, Safety and
Environment is in charge of managing the process. The MMK Group also has the Environmental
Protection Laboratory, a unit that sets the requirements for the environmental management system
(EMS) and checks environmental compliance across production units.
The environmental management systems of MMK and some of its subsidiaries are certified to
ISO 14001 or GOST R ISO 14001 (its Russian equivalent) and are subject to regular surveillance or
recertification audits by an independent body. In 2021, the above systems successfully passed an
external surveillance audit to verify previous certificates of conformity. Also, 2021 saw the EMS
coverage expanded to MMK’s units involved in the sale of finished products.
35
More information about climate risk management will be provided in the 2021 Sustainability Report.
To be a responsible and
sustainable business (ESG)

MMK INTEGRATED ANNUAL REPORT
64
MMK’s Environmental Policy, which includes guiding principles and commitments for all areas
of environmental protection, is maintained as a key high-level document. No changes were made to
the internal EMS documents by the MMK Group in 2021.
CLIMATE CHANGE AND ENERGY EFFICIENCY
Combating climate change
The MMK Group’s Strategy 2025 sets an ambitious goal of reducing specific GHG emissions to
1.8 tonnes of CO
2
equivalent per tonne of crude steel (Scope 1 and 2) by 2025, largely through major
innovative investment projects (construction of Coke-Oven Battery #12 and Blast Furnace #11) which
will curb total GHG emissions by more than 2.8 million tonnes of CO
2
equivalent. These projects are
already underway. In 2021, progress was made in construction and installation for the new coke-oven
battery, slated for commissioning in 2023.
During the year, MMK signed a contract for the construction of a new blast furnace. This project
involves the use of the following state-of-the-art technologies to reduce GHG emissions:
− Top-fired hot-blast stoves.
− Top-pressure recovery turbine to generate electricity without gas firing.
− SYNGAS injection into the furnace shaft to lower the coke rate.
− Bellows-type tuyere stocks to reduce the coke rate.
In 2021, MMK signed a partnership agreement with a metallurgical equipment manufacturer to
jointly research and shortlist decarbonisation initiatives that can potentially be rolled out at MMK.
Looking beyond 2025, the MMK Group is considering the use of technologies such as carbon capture,
utilisation and storage (CCUS), as well as the transition to hydrogen-based direct reduced iron (DRI
and HBI), and the use of submerged-arc furnaces process.
MMK has been taking inventory of GHG emissions since 2016, consistently improving the quality
and completeness of disclosures. For all direct (Scope 1) emissions, apart from mobile combustion,
CO
2
emissions are calculated based on a local regulatory document (Order of the Russian Ministry of
Natural Resources and Environment No. 300 dated 30 June 2015
36
), while mobile combustion
emissions are calculated according to the guidance in the 2006 IPCC Guidelines
37
. The emission factors
we use for Scope 2 (purchased energy) and Scope 3 (upstream and downstream) emissions are based
on publicly available data.
MMK’s gross (Scope 1, 2, and 3) GHG emissions over 2021 totalled 38.9 million tonnes of CO
2
equivalent, up 2.5% year-on-year as the result of higher steel output.
MMK’s gross (Scope 1, 2, and 3) GHG emissions over 2019–2021, million tonnes
of CO
2
equivalent
MMK has improved on last year’s performance on specific GHG emissions (Scope 1, 2) (1.95 vs
2.18 tonnes of CO
2
equivalent per tonne of crude steel) largely through increased EAF steel production
and lower coke rate.
36
Order of the Russian Ministry of Natural Resources and Environment No. 300 On Approval of Recommended Practices and
Guidelines for Measurement of GHG Emissions by Business and Other Entities Operating in the Russian Federation, dated 30
June 2015.
37
2006 IPCC Guidelines for National Greenhouse Gas Inventories.
40.7
38.0
38.9
2019 2020 2021
Gross GHG emissions,
mt of СО
2
e

MMK INTEGRATED ANNUAL REPORT
65
Quantification of GHG emissions (Scope 1, 2, and 3) across the MMK Group’s key operations
marked an important milestone in 2021. Total GHG emissions of MMK and its 11 subsidiaries amounted
to 45.95 million tonnes of CO
2
equivalent in 2021, with results verified by BSI, an independent
international organisation.
Making our first Carbon Disclosure Project (CDP) disclosure and scoring a C rating for the 2020
climate change metric was another milestone for the Group during the year. We are planning to make
CDP disclosures a regular exercise to track progress in managing our GHG emissions and climate risks
Energy efficiency and consumption
The CEO annually approves targets for saving key energy resources we consume, as well as the
energy saving and energy efficiency programme, which includes initiatives to cut energy costs across
the Group. These initiatives not only save costs but also go a long way towards reducing GHG
emissions.
MMK’s Energy Policy sets out the Group’s approach to energy saving and efficiency driven by
improvements in the energy management system, energy monitoring and rationing, employee
training, and energy recovery.
MMK’s energy management system (EnMS) has been certified to ISO 50001:2018 by an
internationally recognised organisation. In 2021, EnMS successfully passed an external surveillance
audit following preparations which involved an internal audit programme across MMK’s units and
employee training, with recertification audit scheduled for 2022.
The Group made the following improvements to its energy management system in 2021:
− Update of the standards that set requirements for sustainable energy use / accounting for
energy consumption, as well as for the stages involved in proposing and implementing energy
efficiency projects.
− Start of the development of a load management project to reduce electricity consumption
during peak hours when prices are the highest.
− Launch of monthly meetings with both MMK employees in charge of power facilities and
subsidiary representatives to further incentivise the workforce to take ownership of energy
management and efficiency.
− Further improvements to the Energy Management Platform, and launch of MMK-Evolution, a
single system to register, monitor, and manage suggestions, ideas, and projects. The integration of
this new business system with an idea tracking module within the Energy Management Platform has
enabled MMK to implement more energy efficiency suggestions and do it faster. The Energy efficiency
map, a recent improvement to the Analytics module of the Platform, has enabled real-time analysis
and adjustment of fuel and energy consumption at MMK units. The coverage of the Analytics module
is expected to be extended in 2022.
2021 saw a number of energy saving and efficiency initiatives, including low-budget, high-
impact projects (quick wins) and efficiency suggestions submitted through the Energy Management
Platform. Also, the provider under our energy services agreement
38
partially upgraded lighting fixtures
within MMK’s Chief Power Engineer Office shop-level general lighting systems.
In 2021, we reduced our consumption of natural gas by minimising bleeder losses and boosting
the use of secondary energy resources (coke oven and blast furnace gases) to power our central and
steam turbine power plants. To reduce bleeder coke gas losses, MMK switched to daily planning of
coke gas consumption and analysed deviations from targets. 2021 saw a coke gas-fired mini-CHPP
(small combined heat and power plant) up and running. Upgrade of a turbine’s duct section with
replacement of stator/rotor stages and diaphragms also contributed to reducing our consumption of
natural gas.
The MMK Group’s energy intensity for 2021 was 21.81 GJ/t of crude steel, down 0.3% year-on-
year, largely due to a 13% increase in steel production and a 2.9% reduction in pig iron ratio.
38
The cost savings generated through the agreement are shared between a beneficiary and a services provider.

MMK INTEGRATED ANNUAL REPORT
66
MMK’s energy consumption for 2021 is 24.72 GJ/t of crude steel.
The MMK Group sees bright prospects for the use of renewables for power generation. In 2021,
MMK and an energy company signed a memorandum of cooperation in renewable energy. Under this
agreement, MMK is considering renewable electricity purchases for powering its assets and/or
purchasing International Renewable Energy Certificate Standard (I-REC) green certificates. We are
also looking into the viability and economics of a wind farm project near Magnitogorsk.
ENVIRONMENTAL PROTECTION
MMK defined environmental goals in compliance with its Environmental Policy. Following these
goals the MMK Group develops and approves an annual Environmental Programme which sets out a
range of environmental protection initiatives (water and air protection, initiatives to extract value from
waste, and land reclamation). In 2021, The MMK Group developed its Environmental Programme until
2030. MMK’s environmental goals are set in the Environmental Programme until 2025. To timely track
progress towards these goals, MMK reviews actual performance against annually approved targets.
MMK’s environmental targets
39
Within the Sinter Shop, Blast Furnace Shop, Coke and Chemical By-Products Plant, Electric Arc Furnace Shop, and Oxygen
Converter shop.
№
Environmental targets
2021 Plan
2021 Actual
1
Reduce Magnitogorsk’s CAPI to (units)
5.6
5.8
decline less
than 5%
2
Reduce gross air emissions of pollutants to a level not exceeding (‘000
tonnes/year)
195.7
187.1
3
Reduce specific dust emissions to a level not exceeding
39
(kg/t of
steel)
0.92
0.74
4
Reduce specific sulphur dioxide emissions to a level not exceeding
5
(kg/t of steel)
0.38
0.32
5
Reduce specific nitrogen oxides emissions to a level not exceeding
5
(kg/t of steel)
0.59
0.57
6
Use waste as secondary material resources in sinter charge (million
tonnes/year)
1.86
1.97
7
Recycle operating and waste slags (million tonnes/year)
10.3
10.2
8
Perform the biological stage of damaged land reclamation of the
Western Quarry in the Magnitnaya Mountain on an area of 8.14
hectares (%)
100
100
9
Perform the technical stage of damaged land reclamation at Phase 3 of
the Western Quarry in the Magnitnaya Mountain on an area of 7
hectares (%)
7.0
9.8
10
Reduce specific GHG emissions to a level not exceeding (tCO
2
e/t of
crude steel)
2.12
1.95
11
Plant saplings under the greening and landscape restoration
programmes (pcs.):
MMK
6,684
7,764
Magnitogorsk
1,620
1,620
12
Conducting a comprehensive environmental survey and developing
measures aimed at preserving, restoring and enhancing biodiversity,%
100
100
13
Perform the stocking of the Magnitogorsk Reservoir (carps ‘000 pcs.)
200
200
14
Define requirements for MMK suppliers that have an impact on the
environment with awareness of their responsibility, (%)
100
100

MMK INTEGRATED ANNUAL REPORT
67
As in the previous year, there were no major environmental incidents or accidents as a result
of the Group’s operations in 2021. Regulatory inspections found no significant environmental violations
and did not impose any non-financial penalties in 2021. In the reporting period, no significant
environmental complaints were received from local communities about the MMK Group’s operations.
In 2021, MMK’s environmental efforts were recognised with awards and high rankings:
− MMK won the Clean Air national environmental award in the Eco-Friendly Company category.
− MMK significantly improved its position in WWF Russia’s Environmental Responsibility Rating,
now ranking fourth.
− MMK won the national ECOTECH LEADER award in the category "Construction of Environmental
Facilities" for the implementation of its environmental strategy.
− The quality of environmental disclosures earned acclaim from AK&M and Expert RA rating
agencies.
Air quality impact
Air quality improvement is high on the MMK Group’s environmental agenda. Comprehensive Air
Pollution Index (CAPI)
40
of Magnitogorsk is a key metric to measure the Group’s impact on air quality.
Best practices and advanced technologies adopted by the Group, in recent years, have been pushing
CAPI towards our 2025 target of less than 5 units.
Comprehensive Air Pollution Index over 2019–2021, units
In 2021, the Group’s gross emissions totalled 252,208.8 tonnes, 10.3% up year-on-year. MMK
Group emission reduction initiatives in line with the Magnitogorsk Comprehensive Emission Reduction
Plan, Emission Allowance Compliance Plan, MMK Group’s Environmental Programme until 2030, as well
as annual programmes such as MMK Group’s Environmental Programme, Programme for the Reduction
of Coke and By-Product Emissions, and Programme for the Reduction of Mining and Beneficiation
Emissions.
The MMK Group continuously monitors and controls its emissions, with emission monitoring
systems installed for the main sources. In 2021, MMK rolled out 14 systems for process units in its
shops. The MMK Group is developing a programme for gathering, storing, and analysing the emissions
data. In the reporting period, an air quality monitoring station was launched in the Bruskovy village in
Magnitogorsk.
In 2021, MMK implemented a range of initiatives to cut emissions from coke-oven batteries at
coke and by-product facilities. These involved installing emission detection and monitoring systems
(automated systems for detecting emission rates from door leaks and video cameras on coal storage
bins), as well as technical measures to fix coke gas leaks (installing gas-tight doors and pneumatic
sealing systems, and retrofitting gas supply piping and accessories). The purchase of two coke oven
machines with a coke-side dedusting system reduced the Group’s coke dust emissions. Also, in 2021,
MMK was constructing a new Coke-Oven Battery #12, which will come on stream in 2023, retiring
obsolete facilities, and reducing emissions.
MMK implemented a number of emission cutting initiatives at its mining and beneficiation
facilities in 2021: installation of dust suppression systems in the burden preparation and blast furnace
40
CAPI is calculated as a sum of the five main pollutants (particulate matter, carbon monoxide, nitrogen dioxide, formaldehyde,
and benzo(a)pyrene), with absolute values of each converted to the number of maximum permissible concentrations (MPCs).
6.8
6.1
5.8
2019 2020 2021
CAPI, units

MMK INTEGRATED ANNUAL REPORT
68
shops; retrofitting of absorption facilities at sulphur capture systems to improve the cleaning of
sintering flue gas; and construction activities to retrofit gas-cleaning units at electric arc furnace (EAF)
and basic oxygen furnace (BOF) shops.
Water impact
The MMK Group is committed to sustainable and responsible water consumption as it
implements initiatives to reduce freshwater withdrawals and pollutant concentrations in wastewater.
The bulk of water used by the MMK Group comes from the Magnitogorsk reservoir, which is not
a water-stressed area
41
. According to the World Resources Institute (WRI) atlas
42
, an internationally
recognised water risk tool, the host region of the Steel Turkey segment is experiencing high water
stress. Steel Turkey segment regularly measures water yields of active wells and analyses water
samples on a daily basis. In 2021, no decrease in yields or changes in freshwater quality were observed
from the previous year. Steel Turkey segment is taking steps to reduce freshwater consumption:
− In 2021, a project was initiated to use neutralised water for the sludge cooling process, with
progress made in laying a pipeline between the neutralisation facility and the sludge dump.
− A reverse osmosis facility was installed to pre-treat and desalt seawater for subsequent uses.
− MMK is exploring the feasibility of rainwater harvesting projects for water saving.
To further reduce water withdrawals, the Group is boosting water recirculation and sequential
reuse (in multiple processes).
Risks associated with pollutant discharges to water bodies are assessed and managed according
to the relevant environmental risk category in the corporate risk management system. In order to
reduce these water risks, the MMK Group monitors water quality across all water withdrawal sources
and water discharge facilities, as well as takes steps to further improve wastewater treatment and
phase out discharges. In 2021, MMK upgraded a mechanical and biochemical wastewater treatment
unit at its coke and by-product operations. The commissioning of a wastewater disposal system in
2021 to divert wastewater from the Dolomite open pit to Sludge Dump #2 eliminated discharges (about
3.7 thousand tonnes per year) into the Sukhaya Rechka River.
The MMK Group proactively engages with stakeholders on water management issues. In 2021,
MMK took part in two meetings of the Basin Council for the Ural Basin District. Also, the MMK Group
supported the Russian Steel Association’s initiative concerning pricing for surface water intake.
Resource use and waste management
The MMK Group’s operations generate Class 1 to 5 waste (from extremely hazardous to virtually
non-hazardous, according to Russian classification), including mining and beneficiation waste, in
particular tailings, gangue, and overburden. The MMK Group is constantly reducing waste generation
while boosting the waste recycling/reuse and safe disposal rates.
The heads of MMK’s units are ultimately responsible for waste management, including support
for environmental initiatives under approved programmes, as well as compliance with applicable
regulatory requirements and provisions contained in internal documents. The head of the Rudnik unit
at MMK’s mining and beneficiation operations is responsible for managing mining and beneficiation
waste.
The MMK Group has an extensive list of internal documents (EMS standards, operational
procedures, etc.) covering waste management activities, including monitoring and maintenance
processes for a tailings disposal facility (Sludge Dump #2).
The Group monitors and inspects waste disposal sites as part of its environmental monitoring
process. We pay particular attention to hazardous facilities, such as Sludge Dump #2 and CHPP ash
dump, with dedicated teams monitoring soil, air, and radiation levels every year, and establishing
groundwater composition and properties every quarter.
41
This conclusion is based on the plan for integrated management and protection of water bodies in the Ural River basin (Russian
part) prepared by the Russian Research Institute for Integrated Water Management and Protection (FGBU RosNIIVH) as
requested by the Nizhne-Volzhsky Basin Water Department of the Federal Water Resources Agency.
42
Aqueduct Water Risk Atlas (wri.org).

MMK INTEGRATED ANNUAL REPORT
69
In 2021, the Group (MMK and 11 subsidiaries) generated a total of 14.5 million tonnes of waste,
including 11.9 million tonnes at MMK, of which 3.5 million tonnes was mining and beneficiation waste,
down 1.7% year-on-year
43
(down 4% year-on-year at MMK). This reduction was due to a decrease in
gangue volumes by 27%. The proportion of waste put back into the production process at the MMK
Group increased by 61.8% in 2021 (74.3% at MMK), as we chose to outsource the recycling and
decontamination of some waste previously disposed.
In 2018, MMK added an iron ore tailings beneficiation line to the sludge section at its ore
beneficiation plant. This line recovers concentrate with iron content of over 53% from wet tailings in
Sludge Dump #2 to produce sinter at low cost. Over the recent years, the plant was retrofitted into a
unique facility for the Russian metallurgical industry that boasts a high-capacity spiral concentrator.
In the reporting period, MMK produced 415 thousand tonnes of iron ore concentrate.
Apart from recycled sludge, recyclables like blast furnace waste and dust, mill scale, and
screenings are used in sinter making. Recycled waste accounts for more than 20% of sinter burden,
while the share of reused iron-containing waste is close to 100%.
In 2021, MMK moved forward with the project for lubricant/coolant recycling at rolling shops.
In particular, we prepared the design documentation, purchased part of the required equipment, made
some construction progress, and revamped the process building. The facility is expected to come on
stream in late 2022.
In the reporting period, MMK initiated two construction projects – a landfill for mining and
beneficiation operations, and a dry cooling site for blast furnace slag.
Also, in 2021, the MMK Group pressed ahead with its initiatives to close and remediate waste
disposal and iron ore mining sites. Projects were developed to remediate tailings and slag dumps. MMK
made preparations for reclaiming the land at the Eastern open pit of Magnitnaya Mountain. As for the
Western open pit, technical and biological stages reclaimed 7.0 and 8.1 hectares, respectively. Also,
reclamation at the Podotvalnoye open pit was undertaken. In 2021, MMK also launched a project to
close three landfill cells for Class 3 oil waste and reclaim disturbed land. Following a public consultation
in 2021 on the right-bank tailings dam reclamation project, the potential environmental impact of the
project was found to be acceptable.
The MMK Group is committed to maintaining an open line of communication to its stakeholders
to discuss environmental protection issues and waste management in particular. As part of the World
Environment Day, MMK arranged the collection of spent batteries and mercury-containing light bulbs
in local communities, and engaged students and members of the Union of Young Metallurgists NGO to
clean up the city of Magnitogorsk.
Biodiversity
Prior to launching an investment project, MMK identifies and assesses any biodiversity risks
posed by the project and, if necessary, designs compensatory measures. MMK Group companies do
not have operations in areas that are internationally, nationally, or locally recognised as valuable in
terms of biodiversity.
A CEO-approved Biodiversity Conservation and Improvement Programme for the Chelyabinsk
Region is in effect at the MMK Group until 2023. The Programme involves the following initiatives:
− Conserving and improving biodiversity in areas and water bodies near MMK’s facilities.
− Restoring and enhancing the biodiversity of fish stocks of the Ural River.
− Enhancing the biodiversity of the active storage portion of the Magnitogorsk reservoir.
− Greening parks, pocket parks, social infrastructure facilities, streets and roads, and the
Company’s site in Magnitogorsk.
Conducting a comprehensive environmental survey and developing initiatives to support
biodiversity on adjacent lands are the essential stage of the first initiative. In 2021, a contract was
43
Comparative data of this indicator for previous periods, which were presented in the 2020 Integrated Annual Report and
earlier, have been recalculated in compliance with the modified calculation methodology introduced in 2021.

MMK INTEGRATED ANNUAL REPORT
70
signed with the Severtsov Institute of Ecology and Evolution, Russian Academy of Sciences, to
accomplish this task.
Also, in 2021, MMK completed the final stage of fish stocking in the Magnitogorsk reservoir by
releasing more than 200 thousand carp fry. Thus, the reporting period witnessed the full completion
of a compensatory measure for the separation dam built in 2018.
In 2021, the MMK Group continued building green spaces in Magnitogorsk, planting more than
1,500 tree and 7,800 shrub saplings in the city, including at the sites of MMK’s enterprises.
2022 PRIORITIES
Next year, MMK Group plans to:
− Further improve its energy management system, in particular through digital projects and
improvements to its climate risk assessment and management processes.
− To continue gradually reduce its GHG emissions on the path towards carbon neutrality.
− To implement its annual energy saving and energy efficiency programme, as well as energy
efficiency measures under its energy services agreement (lighting upgrades and installation of
frequency changers for steam boiler feed pumps).
− To focus on air quality improvement agenda as part of its annual and medium-term
programmes/plans. In particular, we will forge ahead with ongoing investment projects and further
improve emissions monitoring and control.
− Build a wastewater aeration system which will reduce concentrations of iron, manganese, and
petroleum products in wastewater. Our medium-term plans involve building a neutralisation facility at
Rolling Shop #5 and upgrading the primary settling tanks at blast furnace operations.
− Continue existing waste management and land reclamation projects at retired facilities, and
also implement new initiatives under the annual Environmental Programme and the MMK Group’s
Environmental Programme until 2030.
− Continue to implement biodiversity initiatives under the Programme, specifically, the stocking
of the Magnitogorsk reservoir with an expanded mix of fish species (grass carp and bighead), greening
of Magnitogorsk and the MMK site, surveys of the species composition of the flora and fauna near the
MMK site, and the development of appropriate initiatives.

MMK INTEGRATED ANNUAL REPORT
71
HUMAN CAPITAL
Our people are an essential element of the MMK Group's success. The knowledge,
professionalism and achievements of all our employees make us one of the world’s largest steel
producers. Therefore, we attach particular importance to employee’s well-being and occupational
safety, development and inclusion. We respect human rights, as well as promote diversity and equal
opportunities.
53,285 people
THE GROUP’S AVERAGE
HEADCOUNT
25.3%
PERCENTAGE OF WOMEN
AMONG GROUP EMPLOYEES
2020: 28.3%
100%
PERCENTAGE OF MMK EMPLOYEES
COVERED BY THE COLLECTIVE
BARGAINING AGREEMENT
2020: 100%
CORE SDG'S:
MATERIAL ISSUES: 2, 3, 4, 5, 6, 7, 8, 9 ,10, 12, 14
LINK TO STRATEGY:
TRADE-OFFS:
- funding for programmes and projects related to COVID-19
to keep employees healthy and maintain continuous operations;
- investing in training and development to meet our goals of
increasing productivity and developing a culture of opportunity.
0.62
LTIFR, LOST TIME INJURY
FREQUENCY RATE
24,554
PERSON-COURSES TAKEN BY THE
GROUP’S EMPLOYEES AS PART OF
THEIR OHS TRAINING
PROGRAMMES
Highly skilled employees are the MMK Group’s key asset and the crucial element of its success,
since the Group’s production and operational efficiency is directly linked to their professionalism, social
well-being, and health. Creating decent and safe working conditions, improving the incentive and
training systems, and promoting employee development, as well as respecting human rights are
absolute priorities for the MMK Group.
Functional HR management at the MMK Group complies with MMK’s recommended standards.
Depending on their scale and headcount, MMK enterprises have departments charged with HR
responsibilities and headed by HR leaders. In 2021, MMK updated a number of internal documents,
and developed and implemented the HR Policy, Youth Policy, and other HR management policies – all
available on MMK’s website in the Human Rights section.
The Company performs regular identification and analysis of HR risks, designing relevant
mitigation measures. In the reporting period, principal HR management risks remained unchanged
from 2020.
As of 31 December 2021, MMK’s average headcount totalled 53,285 people.
Creating a safe working environment and protecting the health of MMK Group employees and
contractors is our top priority as outlined in the MMK Group’s Strategy 2025. Occupational health and
safety (OHS) is regulated by the Health, Safety and Environment Committee of the Board of Directors
and dedicated specialists responsible for OHS across the organisation.
The Health, Safety and Environment Committee holds meetings every year in accordance with
the annual schedule to discuss OHS initiatives and activities, accidents and incidents, and other
important safety matters. The Committee held three meetings in 2021. All activities developed and
implemented following the meetings are aimed at reducing injury rates.
To be a resposible and
sustainable business (ESG)

MMK INTEGRATED ANNUAL REPORT
72
Matters related to ensuring healthy and safe working conditions are governed by the MMK
Group’s internal regulations and statutory requirements. MMK’s main regulatory document is the
Occupational Health and Safety Policy, which outlines occupational safety goals, principles, and
commitments. The provisions of the Policy apply to contractor employees as well.
At ten Group companies, including MMK, the OHS management system is certified to ISO 45001
and has passed an external surveillance audit for compliance with this standard in 2021.
OUR EMPLOYEES
Attraction, retention, and motivation
The MMK Group actively cooperates with secondary and higher vocational education institutions,
and holds industry-specific conferences and other events to attract new talent. The MMK Group upholds
the requirement for job applicants to have a vocational background or a relevant industry skills
certificate. In 2021, employees with an industry-specific degree accounted for 93.3% of new hires at
MMK
Attracting new employees and engaging young talent
Running career guidance events for Magnitogorsk school students is the first step in attracting
potential employees to MMK and the MMK Group. Prior to the introduction of COVID-19 safety
measures, MMK offered guided tours for school students, doing about 150 tours a year for more than
2,500 visitors. This programme will resume once the situation returns to normal. As part of MMK’s
career guidance efforts, MMK Group executives paid an annual visit to schools on 1 September 2021
and spoke to future graduates. In addition, the Union of Young Metallurgists runs career guidance
events at schools, with young workers telling graduates about their own career choices.
The MMK Group offers internship opportunities at its facilities for students of industry-specific
vocational education institutions. In 2021, a total of 1,565 students completed internship programmes
at MMK’s production units. Once they are awarded their degrees, young specialists are hired by MMK’s
and the MMK Group’s production units in accordance with their qualifications. Each candidate’s
professional skills, average diploma score, and knowledge of foreign languages are all taken into
account. In the reporting period, the 4+ Programme was developed and launched to attract university
students and provide targeted training for them along with scholarships on behalf of the Company.
The programme will continue in 2022.
Special staffing quotas for young talent remain in place. Every year, MMK hires 500 to 600
graduates of vocational education institutions and young people who have completed post-graduation
military service. In 2021, the MMK Group successfully met its target of hiring at least 500 graduates
of vocational education institutions and young people who have completed post-graduation military
service.
New employees attend an induction workshop to familiarise themselves with MMK’s business
lines, goals, values, and mission. During the workshop, young employees meet the Company’s current
leaders (including directors) in charge of the specific business line. To onboard and introduce newly
hired young talent to the culture and occupational health and safety standards, unit-specific
apprenticeship plans are drawn up for all new hires.
Employee motivation and remuneration
The MMK Group makes every effort to offer decent working conditions and competitive salaries.
The current remuneration and bonus system covers all MMK Group employees. Remuneration is paid
in accordance with the Russian Labour Code and federal labour laws. MMK’s remuneration system also
relies on the principles of the Industry Tariff Agreement for the Russian Metals and Mining Industry for
2020–2022, MMK’s Collective Bargaining Agreement, and corporate policies: Working Conditions
Policy, Productivity Policy, Equal Opportunities Policy, Gender Pay Gap Policy, and Employment and
Occupation Anti-discrimination Policy.

MMK INTEGRATED ANNUAL REPORT
73
Salary levels are reviewed on a monthly basis. In 2021, MMK raised employee wage rates by
6.5%. The majority of MMK Group entities also adjusted employee wage rates.
The minimum salary at the MMK Group exceeds the statutory minimum wage. Remuneration is
only determined by the experience, qualifications, expertise, and performance of an employee in
question. MMK may pay remuneration to managers and employees in key roles in line with contracts
for performing more challenging tasks and achieving stretching targets, with progress measured
against pre-defined criteria.
To motivate employees to handle the tasks faced by MMK, additional bonuses are used to
stimulate proactive approaches and provide financial incentives for professional growth.
Diversity and equal opportunities
The MMK Group supports social and cultural diversity among its employees and strives to build
a more inclusive work environment. In 2021, at MMK the following documents were developed and
approved:
- Human Rights Policy
- Equal Opportunities Policy
- Gender Pay Gap Policy
- Youth Policy
- Freedom of Association and Protection of the Right to Organise Convention Policy.
The MMK Group provides equal opportunities in training, remuneration, and career development
for all employees of the Group. Competitive recruitment at MMK is based solely on each person’s
professional and business skills and personal qualities. Training is available to all employees within
their job profiles irrespective of their gender, age, or membership in social groups.
Since metals industry jobs involve hazardous industrial work and under Russian law such work
may not be performed by women, children, and disabled people, MMK has a consistently high male
representation in its workforce – 74.7% in 2021. The proportion of women among Company employees
remained virtually unchanged in 2021 at 25.3% (2020: 28.3%).
In line with Russian laws, the Company hires people with disabilities. In 2021, the MMK Group
employed 500 people with disabilities (2020: 481 people), which exceeds the quota established by the
government. If an employee with disabilities needs retraining for a new job, the Company will cover
relevant training expenses.
Training and development
The MMK Group provides extensive training opportunities to unlock the potential of its
employees and develop their professional skills, which is formalised in its internal documents. MMK
invests heavily in employee development, training, upskilling, and professional retraining. A multi-tier
corporate training framework is being implemented. The Personnel corporate training centre is the
MMK Group’s primary base training centre. In 2021, a number of training programmes were updated
and new programmes were developed, with employees provided with access to a distance learning
system offering materials for self-learning and development. All training courses employees might
need to perform their current tasks or to meet future requirements are paid for by the Company. In
addition to the cost of courses, the training compensation package covers 100% of the following
expenses: travel to the place of training, accommodation during training, compensation for the
inconvenience caused by changes in living conditions (daily allowance), and average wage for the
period of training, with employees retaining their jobs.
MMK is building a talent pool and maintaining its Regulations on Building and Training the
Management Talent Pool.
The MMK Group regularly sends employees to leading educational centres in Russia and around
the world (including Stockholm School of Economics, London School of Economics & Political Science,
International Institute of Management LINK, Nosov Magnitogorsk State Technical University). Various
formats are used to train and educate MMK employees – from higher education institutions and
professional retraining to internships with leading manufacturers in Russia and abroad.

MMK INTEGRATED ANNUAL REPORT
74
The Company encourages employees to independently improve their education and provides
the opportunity to do so by paying average wages for the days off used to attend training sessions for
employees studying for their first degree.
All employees who have sustained work-related injuries may retrain for a new job in line with
their career profiles and new roles at their enterprises at the expense of the MMK Group, regardless of
their age.
Employee career paths are charted by unit managers and the Talent Management Department.
The Company monitors and records employee performance on a regular basis. Under the Corporate
Culture of Opportunities strategic programme, employees of MMK’s units are evaluated twice a year
against the corporate competency model, and the evaluation results are translated into individual
salary growth percentage for each employee.
In 2021, as part of the Interactive Training Platform Development project, an electronic platform
was created where each employee can choose their development goal in line with their professional
skills, see the job requirements that need to be met, and select training courses to close skill gaps.
The MMK Group intends to maintain the continuity of the training process for employees at all
levels and add new training programmes aimed at developing employees’ communication skills and
behavioural competencies.
Social policy
The MMK Group is committed to creating comfortable working conditions for its employees while
ensuring social security. MMK Group employees of all categories are entitled to a social package of
benefits and guarantees. MMK runs a number of internal social programmes for employees and their
families. In addition, all employees are covered by corporate voluntary health insurance.
The MMK Group’s progress against its stated goals in social support for employees
and their families
Goal
Progress in 2021
Ensuring that employees’
social package is
increased by at least 5%
annually
The target for this goal was fully met. The targeted social package growth was
5% year-on-year, while the actual social package grew by 23% to $614.9
(2020: $499.2) per employee (net expenses, excluding maintenance of social
infrastructure facilities).
Reactivating all social
programmes suspended
due to the pandemic, and
launching the Health
Leaders programme
In 2021, a new unique programme, Health Leaders, was launched to develop
and promote a healthy lifestyle. The programme is aimed among other things at
boosting employees’ motivation to pursue a healthy lifestyle, as well as growing the
number of people who regularly practice sports. Health Leaders help spread
awareness about sports, healthy eating, and healthy habits without involving external
experts. The 20 activists are part of the MMK Group workforce, and they completed
dedicated training in healthy lifestyle and fitness. Their task is to target specific
employee focus groups, organise sporting events and workplace fitness schemes,
develop their own programmes, and participate in competitions.
Since 2021, the first aspect of the support programme for MMK employees with
disabled children has been implemented – financial assistance of $41 for the start of
the school year. Going further, MMK intends to expand this programme, adding new
support initiatives.
Increasing the
Company’s spending on
social programmes,
bringing the social
package across Group
entities to at least 80%
of that provided at the
parent company
A major emphasis within these efforts was placed on MMK Group subsidiaries.
Social support at certain subsidiaries is still significantly below the MMK average,
reflecting the entities’ budgets and specific working conditions. However, the efforts
taken in 2021 to boost the coverage of employees from MMK Group subsidiaries by
health improvement programmes and healthcare (prevention) services helped
improve the subsidiaries’ average score to 78.8% of MMK’s level (2020: 67.5%).

MMK INTEGRATED ANNUAL REPORT
75
Human rights and non-discrimination
The MMK Group recognises the importance and value of fundamental human rights and
freedoms, and builds relationships with its employees and other stakeholders based on the principles
of mutual respect and responsibility. The MMK Group does not tolerate discrimination on the grounds
of race, gender, age, sexual orientation, social status, religion, or social background in line with
applicable laws. These commitments are reflected in the Company’s regulations on hiring, training,
and building a management talent pool, as well as in its HR Policy, Working Conditions Policy, Human
Rights Policy, Equal Opportunities Policy, Employment and Occupation Anti-discrimination Policy,
Minimum Age for Admission to Employment Policy, Policy on Sexual Harassment, Stalking and
Violence, etc.
The MMK Group guarantees protection of labour rights to its employees and respect for the
rights of stakeholders outlined in the Constitution of the Russian Federation, the Russian Labour Code,
as well as in the UN Universal Declaration of Human Rights and the UN Guiding Principles on Business
and Human Rights approved by the UN Human Rights Council in 2011.
In 2021, MMK developed and implemented the Human Rights Policy, posted on MMK’s website
in the Human Rights section.
In 2019, the Company launched its Ethics Hotline, which serves as the principal human rights
whistleblowing and response tool. In the reporting period, no cases of discrimination were recorded;
however, nine cases of non-compliance with employment standards were reported at MMK Group
subsidiaries and four cases at MMK.
In 2021, MMK’s Collective Bargaining Agreement was renewed until 2023 with a number of
amendments to its social security provisions. The agreement provides for social programmes
benefitting employees, and its provisions are regularly reviewed to ensure compliance with statutory
requirements. In 2021, the Collective Bargaining Agreement covered 100% of MMK employees. MMK
Group subsidiaries also have their own Collective Bargaining Agreements.
MMK supports the rights of its employees to freedom of assembly and association and the right
to enter into collective bargaining agreements in line with Russian labour laws and the Constitution of
the Russian Federation. The MMK Group’s primary trade union organisation, the Miners’ and
Metallurgical Workers’ Union of Russia (a nationwide independent trade union organisation), is the
main body responsible for interactions with employees and representing their interests. The Company
recognises the Miners’ and Metallurgical Workers’ Union of Russia as the only representative of its
employees as it has been authorised by a conference of MMK employees to represent their interests.
OCCUPATIONAL HEALTH AND SAFETY
Preventing occupational injuries and diseases
Occupational safety is a clear priority for the company. For MMK, this is not just a performance
metric, but a vital indicator. Every year, about $35-40 million are invested in ensuring safe production,
based on an integrated approach in a zero-injury environment.
MMK Group employees and contractors are involved in monitoring the identification and
elimination of hazardous conditions and activities on the shop floor on a daily basis, and may stop or
suspend work that they believe may result in an injury or harm to employees’ health.
OHS risk management
In line with the official risk management standard – ISO/IEC 31010:2011, the MMK Group
identifies, analyses and assesses its OHS hazards and risks twice a year across all operating processes.
The main activities in identifying and preventing OHS risks:
- Oversight of repairs by the Occupational Health Directorate and the OHS unit at the Group’s
subsidiaries
- Internal operational control across all units
- Use of technology solutions to capture breaches: Safety Navigator to assess identified
hazardous activities and conditions

MMK INTEGRATED ANNUAL REPORT
76
- Behavioural safety audits.
Since January 2021, MMK has been using the Safety Navigator mobile assistant. The app was
designed to enable shop managers to capture identified hazardous conditions and activities, post
photos, and assign tasks to the area supervisors to correct the situation. The app was rolled out across
eight MMK Group subsidiaries, with further rollout scheduled in 2022.
We implemented 115 technical initiatives during the year to mitigate the risk of accidents. To
prevent occupational injuries, plans for 2022 include visualisation of trainings in hazardous process
operations.
The MMK Group is implementing a system of production processes automation using employee
tracking to reduce the number of accidents. These sensors enable remote monitoring of employees in
high-risk areas and preventing potential injury by performing a forced shutdown of the equipment in
question. In the next reporting period, we will continue developing and scaling up this system.
MMK ensures employee safety through advanced technology:
Machine vision: employee tracking in hazardous areas
- Detects when workers get dangerously close to machinery
- Warns the operator and worker of the danger
- Prevents/stops the movement of the coke pusher car.
Machine vision: monitoring OHS compliance
- Audio and visual alarms at hazardous areas
- Visual records of breaches for the database
- Reduction in the workplace injuries and increased enforcement of personal protective
equipment.

MMK INTEGRATED ANNUAL REPORT
77
Injury rates
44
In 2021, the Guidelines for Calculating Injury Rates at PJSC MMK Units and MMK Group
Companies were approved. They allow for expanding the reporting boundaries and recording all
accidents taking place at the MMK Group’s production sites, including those involving contractor
employees. The Guidelines set out formulas for calculating key injury rates, as well as the calculation
method.
During the reporting period, the injury frequency rate (LTIFR)
45
at the MMK Group (including
injuries to contractor employees) decreased by 6% to 0.62 with 97 accidents (2020: LTIFR 0.66 with
67 accidents). The main cause of accidents in 2021 was same-level falls.
In 2021, the Group recorded one employee fatality (caused by a crane block fall) and four
fatalities involving contractors (two resulted from falls from height, one from a pinch-point injury, and
one from a fire). All necessary investigations have been conducted and corrective actions taken. To
ensure safe working at heights, all contractor employees who work at heights (over 200 people) were
re-trained.
We reiterate our strategic goal to decrease LTIFR further to 0.45 while fatalities should be
decreased to 0 by 2025.
Steady decrease in LTIFR
Promoting safety culture
The Company organises OHS training events for its employees and contractors on an annual
basis. The training offered complies with Russian laws and the MMK Group’s internal standards and
policies. In 2021, the Group employees took 24,554 person-courses of OHS training.
Starting in early 2021, we implemented the first stage of MMK employee training under the
Safety Awareness programme. The training was provided by Ivan Maurakh, a trainer from the Business
Relations company, and targeted top managers and unit heads. A total of over 26 thousand people
were trained at MMK and its subsidiaries. Training of internal coaches under the Safety Awareness
programme was organised, where 20 trainers from PJSC MMK and the Group’s companies were trained.
The second stage of the training will involve OHS training for employees run by unit heads together
with the trained trainers. The plan is to train about 30 thousand people in 2022. The primary goals of
the second stage of the Safety Awareness training are to transform the attitudes of employees toward
safety and help them develop individual safety plans covering each workplace for the duration of a
shift.
To monitor the performance of the OHS management system, the Comprehensive Labour Safety
Index (CLSI) is measured on a quarterly basis. In 2020, the CLSI stood at 2.42, and in 2021 it was
2.76. The increase was due to the actual reduction in the number of breaches, verified through a
monitoring procedure run by specialists from the Health, Safety and Environment Department, as well
as the introduction of the Safety Navigator automated system.
44
This section discloses injury rates for MMK’s Russian assets excluding the Steel Turkey segment.
45
Lost Time Injury Frequency Rate (LTIFR) = (number of lost time injuries) x 1,000,000 / (total hours worked).
0.89
0.66
0.62
0.45
2019 2020 2021 2025 TARGET
World Steel
Association
average, 2020
0.85
-26%
Key metals and
mining companies
in Russia
average, 2021
0.91
-6%
-27%

MMK INTEGRATED ANNUAL REPORT
78
The Group has a dedicated training centre, Safety School, where Group employees are trained
in OHS matters using custom-made simulators and VR training solutions at 8 locations across MMK’s
production shops, as well as other advanced training technologies. In addition, the safe performance
of 270 hazardous process operations were visualised, with relevant video briefings produced. A total
of 2,648 Group employees were trained at the Safety School in 2021 (2020: 2,220 employees). Plans
for 2022 include further development of VR simulators.
Consistent step to Zero injuries
Advanced technology helps to train employees in safe working practices
Communication and feedback
The MMK Group provides communication channels for employees and other stakeholders. OHS
information is available in the Occupational Health and Safety section of the MMK website, on the
intranet, on the Trade Union’s website, in the My MMK mobile app, on information boards, as well as
in the corporate magazine.
Since late 2020, the Company has been publishing a weekly ‘Be in the Know!’ column in the ‘I
Work at MMK’ community on VKontakte, which tackles a wide range of OHS matters: accidents,
behavioural safety audits, special assessment of working conditions, first aid guidelines, and other hot
topics. In 2022, we plan to continue posting occupational health-themed stories on the VKontakte
social network.
Prevention of occupational diseases
Every year, each employee undergoes a health check at the clinical healthcare centre of
Magnitogorsk, as required by Russian laws. In addition, two professional programmes are in place: a
cardiac programme and a recovery programme for those who had COVID-19.
The MMK Group continues to roll out an automated healthcare system. There are plans to fully
integrate employees’ electronic medical records with the corporate information system, which will store
all necessary medical information regarding employees. In addition, special terminals are being

MMK INTEGRATED ANNUAL REPORT
79
installed at medical aid posts to enable pre-shift/pre-trip health checks, capture the results, and
automatically keep an electronic log.
In 2021, 11 occupational diseases were diagnosed among MMK Group employees. The most
common occupational diseases were: silicosis, sensorineural hearing loss, chronic non-obstructive
dust-induced bronchitis, pneumoconiosis, and hand-arm vibration syndrome. To reduce the risk of
occupational disease, the Company keeps employees fully and adequately informed about existing
risks and the need to use specific types of personal protective equipment.
During the reporting period, measures to protect employees from COVID-19 were continued.
In 2021, we began organised vaccinations, as well as revaccinations (six months after vaccination or
six months after convalescence). The vaccination of employees is organised in 15 health posts located
on the MMK and the Group entities sites, as well as in three vaccination rooms of the Central Clinical
Healthcare Unit (CCHU). Vaccines are supplied in sufficient quantities and vaccination rooms are open
daily. MMK Group employees were provided with masks, hand sanitiser, and other personal protective
equipment. Premises were regularly disinfected. A hotline where all employees can seek help and
advice has been set up and continues to operate.
Emergency preparedness
An emergency response system in place at the MMK Group enables prompt responses to
emergencies as they arise. A feedback loop has also been established, enabling any interested party
to report a potential emergency by calling the telephone numbers listed on MMK’s public website, by
sending a message via the Feedback section, by calling the hotline of MMK’s OHS Department, or via
the My MMK and Online Trade Union apps.
In 2021, we ran comprehensive emergency prevention drills, practical fire extinguisher training,
and tabletop exercises. We engage with the administration of Magnitogorsk via Russia’s nationwide
disaster management system.
2022 PRIORITIES
Next year, the MMK Group plans to:
- continue implementing the 4+ Programme aimed at attracting university students and
providing targeted training for them along with scholarships on behalf of the Company;
- continue evaluating its employees twice a year;
- maintain the continuity of the training process for employees at all levels and add new training
programmes aimed at developing employees’ communication skills and behavioural competencies. The
Group plans to maintain its cooperation with leading education centres in Russia and abroad;
- provide access for process staff to interactive maps of blast furnace shops and VR-training
‘Accident Management Plan: Burnout of ladle pot’ as part of the Interactive Training Platform
Development;
- develop the Employee Development Platform;
- continue offering employees English language training at the Company's expense, provided
they achieve their declared level of English proficiency;
- evolve the safety culture of MMK and contractors employees through: training events under
the Safety Awareness programme, development of VR simulators in the Safety School, visualisation of
training of hazardous technological operations, development of the Safety Navigator automated
system, improvement of the safety alarm system, posting occupational health-themed stories on the
VKontakte social network, organisation of OHS supervising during investment projects and
maintenance works;
- automate OHS systems such as electronic work order, robotics and video analytics, employee
tracking systems in hazardous area, key-bar system;
- continue implementing a programme of technical measures aimed at reducing the risk of
accidents.

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SOCIAL AND RELATIONSHIP CAPITAL
We recognise the importance of our contribution to the development of local communities and
building long-lasting relationships with our suppliers and clients. We are committed to ensure the well-
being of the city of Magnitogorsk and Chelyabinsk Region - our core operating region. As part of our
attentive and respectful engagement with suppliers and customers, we seek to provide mutually
beneficial partnerships and best quality products and services.
$16.3m
THE GROUP’S INVESTMENTS IN
LOCAL DEVELOPMENT AND
PHILANTHROPY
94.2%
OF RESPONDENTS ARE
SATISFIED WITH THE SCOPE AND
QUALITY OF SOCIAL SERVICES
PROVIDED BY THE METALLURG
CHARITABLE FOUNDATION
50
OWN SALES DISTRIBUTION
NETWORK UNITS
72%
OTIF
2,440
ACTIVE SUPPLIER BASE
$7.5m
SAVINGS RESULTING FROM
SUPPLY AND PROCUREMENT
STRATEGIES
CORE SDG'S:
MATERIAL ISSUES: 1, 2, 3, 4, 5, 6, 7, 8, 12, 13, 14
LINK TO STRATEGY:
TRADE-OFF: Investments in creating a comfortable environment in the
regions of presence to strengthen and maintain the Company's
reputation
MMK makes a significant contribution to the development of its operating regions and actively
engages with local communities, addressing residents’ real needs and providing social support. The
Company seeks to improve the quality of life and promotes well-being of the population primarily in
its core operating region – the Chelyabinsk Region and Magnitogorsk. MMK promotes social
development by investing in sports, healthcare, education, and other areas, including urban
infrastructure enhancement. Being a backbone enterprise, MMK recognises its responsibility and
commits to addressing the needs of local communities. Close cooperation with the authorities in
Magnitogorsk and the Chelyabinsk Region enables proper planning and design of local social
programmes. In particular, the Company gains insights into the needs of Magnitogorsk residents from
regular social surveys of local voters and their electoral behaviour, which highlight local social issues
or areas for improvement in local public services. Furthermore, when selecting programmes for
implementation, the Company uses the 'Social and Economic Development Strategy for Magnitogorsk
Until 2035’ as a reference.
MMK offers its customers a wide range of metal products while expanding its offering to meet
constantly evolving customer demands. Many years of experience engaging with consumers in the
market and our advantaged location near major industrial hubs help us drive the Company’s growth
and boost its profile as a strategic supplier for its customers. Customer relations at MMK are guided
by the quality management system in place and our product supply agreements.
Long-term partnerships are a key performance indicator for supplier management. The MMK
Group is committed to ensure the transparency of procurement and supplier selection procedures. The
Procurement process at MMK is managed by the Commercial Directorate. In 2018, two departments
were formed within the Commercial Directorate to implement category-based procurement
To be the best supplier
To be a leader in operational
excellence
To be a responsible and sustainable
business (ESG)

MMK INTEGRATED ANNUAL REPORT
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management, with procurement functions realigned and divided into the category unit and operations
unit. The core procurement activities of the category unit are developing category strategies and
implementing initiatives to deliver economic impact, driving supplier selection including through MMK’s
electronic trading platform, signing contracts and specifications for all procured categories, and building
and managing long-term and mutually beneficial relationships with suppliers. Procurement activities
of the operations unit include ensuring the organisation of delivery and support for all procurement
categories, providing procurement control for investment projects and document workflow optimisation
for acceptance, retirement, and payment for supplies (including by moving the relevant processes to
a centralised service group), and driving supplier claim management. Also, annual, quarterly and
monthly KPIs designed to maximise economic efficiency were introduced to improve the performance
of MMK’s Commercial Directorate.
Building transparent, open and trust-based stakeholder relationships is integral to the MMK
Group’s business, as we remain committed to improving the performance of our anti-corruption system
and promoting business ethics policies and standards.
The MMK Group strictly complies with Russian legal requirements including anti-trust legislation
and does not prevent market competition. Relevant units reporting to MMK’s Chief Legal Officer are
responsible for ensuring compliance with the Russian and international laws.
The MMK Group’s regulations in place set out the underlying values, principles, standards and
norms of conduct, and include the following core documents: The MMK Group’s Code of Ethics (the
Code of Ethics), Anti-corruption Policy, and Regulations on the Prevention and Management of Conflicts
of Interest. Internal regulations are available on the MMK website in the Corporate Governance –
Documents of Company section.
DEVELOPING THE OPERATING REGIONS AND LOCAL COMMUNITIES
Social investments
Improving public health
Improving public health is one of the Company’s priorities and is mostly focused on raising the
bar on healthcare services. MMK contributes to the technological upgrade of the Central Clinic
Healthcare Unit (CCHU) on an annual basis, in 2021 $3 million worth of equipment was acquired for
its needs. The Company maintains ongoing preventive and recovery interventions to address the
COVID-19 pandemic. Employees and veterans of its site enjoy free recovery care and health resort
treatment at the medical and social centre of the Metallurg foundation. MMK’s production site has
implemented and actively runs a recovery programme for employees who have had COVID-associated
pneumonia, using state-of-the-art equipment.
Support for social infrastructure facilities
MMK is actively involved in the social life of Magnitogorsk, supporting various social
infrastructure facilities, such as recreation centres, educational and healthcare facilities, as well as
children’s recreational centres and health resorts in Bashkortostan and the Chelyabinsk Region.
The Company supports mass participation sports events hosted by the Metallurg-Magnitogorsk
Sports Club, which has a diverse infrastructure, providing for children and youth, and adaptive sports.
MMK directly organises or supports a wide range of sports events, the most prominent ones in 2021
being the Russian Beach Volleyball Championship and the first stage of the FIS Snowboard World Cup.
The Company has also completed the design of a major sports and recreation centre with a swimming
pool in Bashkortostan.
Philanthropy
MMK is strongly focused on charity programmes implemented by the Metallurg charitable
foundation and local non-profit organisations. In 2021, in particular, the Group provided assistance to
6,000 people in hardship under the 21st Century-the Children of South Urals programme and provided

MMK INTEGRATED ANNUAL REPORT
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355 families with support for the treatment and rehabilitation of children with special needs, while
making regular purchases of medicines for children suffering from cystic fibrosis. The Company’s other
activities include support for seniors, mentoring of talented youth, maternity protection, and targeted
grants to address socially significant issues. In 2022, MMK also plans to organise a resource classroom
for the development and socialisation of children with Down’s syndrome.
Employee volunteering
The Company’s volunteer initiatives are spearheaded by the Union of Young Metallurgists, which
brings together 385 young blue-collar employees to facilitate the onboarding and all-round
development of young employees, and unlock their potential. The more significant efforts include major
environmental initiatives, organising and holding sports events, and the ‘Live Actively!’ project to
promote a healthy lifestyle.
Cooperation with local communities
Education and support for young people
The Company sees developing the skills of young people in Magnitogorsk as critical for its future
success and provides support for education and educational initiatives for young people in the host
region. Nosov Magnitogorsk State Technical University is MMK’s principal source of top talent and a
long-standing partner. MMK is the principal sponsor and an industrial partner of the Quantorium high-
tech park for children, which offers high-impact career guidance programmes. The Union of Young
Metallurgists holds sports events, quizzes, creative, research and technical competitions for young
blue-collar employees while also representing their interests in driving fair labour relations within the
Company.
Industrial tourism
Since 2018, MMK has been actively developing its industrial tourism programme, aimed at
boosting Magnitogorsk’s appeal for tourists, studying the industrial history of the region, and putting
a spotlight on steelworkers’ careers. Industrial tourism promotion is a perfect fit for the MMK Group’s
development strategy and matches the sustainability agenda. Despite COVID-19 restrictions, over
4,000 visitors took a tour of MMK’s production site in 2021 to get a glimpse into steelmaking. A series
of virtual tours was also hosted, including dangerous and hard-to-access facilities off limits for visitors.
In November 2021, the Company co-hosted the Second Russian Industrial Tourism Forum together
with the Agency for Strategic Initiatives and the authorities of the Chelyabinsk Region. To promote
experience sharing, the Group plans to open an Industrial Tourism Competence Centre based on the
Personnel corporate training centre in 2022. It will become a platform for various enterprises to share
experience and learn industry best practice in this area.
Urban amenities
MMK has teamed up with the Magnitogorsk city administration to create a comfortable urban
environment, taking part in capital upgrade projects, revamps of road network, urban greening, and
the creation of parks. All stages of infrastructure project implementation take into account stakeholder
views, enabling us to make the best decisions.
The Prityazhenie project
MMK’s activities are not limited to the Company’s production site. The Company's beneficial
shareholder has initiated and invested in the Prityazhenie urban development project. In 2021, further
progress was made on the multifunctional park project. The 400-hectare area will accommodate
cultural, educational, business, and sports facilities, as well as other sites for leisure activities of local
residents. The diversity of its functional spaces and unique architectural and planning design solutions
make the Prityazhenie park one of the most advanced comfortable urban environment projects in
Russia. At this point, the construction of utility systems and road network has been completed. The

MMK INTEGRATED ANNUAL REPORT
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project’s first stage, including the park and the entrance area with a fountain, is scheduled for
commissioning by the Metallurgist Day in 2022. The opening of the park’s remaining zones for visitors
is expected in 2025.
Supporting small and medium business in Magnitogorsk
For Magnitogorsk to thrive, it needs a large and diversified business sector, which is why MMK’s
efforts to foster an advanced, accessible, and innovative business environment have become part of
the Company’s long-term strategy. Further enhancement of the Industrial Park, created in 2016, and
offering favourable conditions for growing various businesses also contributes towards this goal.
The Industrial Park is a ready-to-use property asset with functional utilities, significant energy
and technical water supply capacity, and access to the railway network. Its tenants enjoy the full
package of tax benefits provided for industrial parks, as well as project co-financing opportunities. In
2021, the rating agency Expert RA praised the customer focus and investment potential of MMK’s
Industrial Park, which ranked third (out of 28) in the Sites Located Up to 250 km from an Economic
Growth Centre category.
There are 38 legal entities registered at the site, 19 of which are manufacturer tenants that
qualify for the benefits stipulated by Resolution of the Russian Government No. 794 On Industrial Parks
and Management Companies of Industrial Parks, dated 4 August 2015. Four of them were brought in
during the reporting period. In 2021, the total average headcount of the park’s tenants reached 948
employees (including 21 new jobs).
The occupancy at the Industrial Park increased by 21%, which is 9% above target.
Occupancy at MMK Industrial Park, ths m
2
Product shipments grew by 20% year-on-year to $50.3 million. This metric is growing every
year, showing a positive trend.
Product sales, $m
+ 16 048
23.3
41.8
50.3
2019 2020 2021
Product sales, $m
105.3
121.3
147.0
2019 2020 2021
Size of area, ths m
2
+16.0
+25.7

MMK INTEGRATED ANNUAL REPORT
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QUALITY MANAGEMENT AND CUSTOMER RELATIONS
Quality management system
MMK’s objective in product quality assurance is to ensure that we manufacture consistently high
quality and competitive metal products meeting the expectations of both Russian and international
customers, which in turn is key to maintaining the Company’s stable financial position. MMK continues
to supply a significant share of products to key industries, reinforcing its market-leading position and
improving customer satisfaction.
The Company’s approach to product quality is defined by its Quality Policy, which also enables
better management decisions, drives process optimisation, and ensures quality control throughout the
entire manufacturing process.
MMK has implemented a quality management system to ensure consistently high quality of its
products and maintains documented procedures for each business process, including customer
relations. More information is available on MMK’s website in the Quality Management System section.
At present, the uniform quality management system (QMS) requirements apply to 10 Group
subsidiaries and MMK.
MMK Group employees familiarise themselves with regulatory documents in line with the MMK
Group’s Standard for Managing Documents of the Management Systems. General Provisions. The
Standard sets out a list of documents employees are required to familiarise themselves with, whether
individually by signing an acknowledgment form or collectively – at a meeting or pre-shift briefing,
through e-mail, or otherwise.
QMS-related regulatory documents were updated during 2021 to reflect the new requirements
of the international standard IATF 16949 defining the fundamental quality system requirements for
organisations where automotive parts for production and/or service are manufactured, as well as
changing roles of MMK’s units. In the reporting period, the application of the IATF 16949 standard
requirements was expanded to cover MMK’s long products shop and thick plate production (Mill 5000),
with successful certification to the standard.
Product quality controls and certified standard compliance checks
Integrated internal audits of management systems
Quality management system
(QMS)
Environmental management
system (EMS)
Occupational health and safety
(OHS) management system
ISO 9001:2015
IATF 16949:2016,
STO Gazprom 9001-2018
ISO 14001:2015
ISO 45001:2018
To comply with the requirements of ISO 9001, the Group approved and implemented standards
that set requirements for QMS and the Integrated Management System at MMK Group subsidiaries.
MMK’s existing contract with the certification body TÜV NORD CERT GmbH (Germany) covers the
certification of QMS, EMS, and OHS Management System at MMK and 10 MMK Group companies.
Surveillance audits conducted in 2021 confirmed the certificates of conformity to ISO 9001 and
STO Gazprom 9001, and a new IATF 16949 certificate of compliance with an expanded scope is now
being issued following a recertification audit.
Quality assurance in production
When shipping finished products, MMK issues quality certificates and keeps records of quality
parameters using composite quality indicators.

MMK INTEGRATED ANNUAL REPORT
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In addition, MMK holds 58 valid certificates of conformity, which are regularly verified through
periodic inspections by certification bodies.
To eliminate the risk of fraud by unscrupulous consumers, all MMK’s metal products are
supported by accompanying documents, including a quality certificate. A certificate’s authenticity can
be verified via a QR code on it and by entering the certificate’s details on MMK’s website.
In 2021, MMK’s composite quality indicator improved to 1.82% from 2.43% in 2020 as a result
of our strong focus on quality. The Company also implemented the following:
– Dynamic process sheets project to develop and deploy an information system for dynamic
management of technology and technological risks
– Unified Information System for the Management of Corrective Measures Based on Inspection
Results (Corrective Measures and 8D)
– Information system to monitor and improve compliance with process procedures at
steelmaking and rolling workshops (the Button IS), boosting the accountability of staff for following
process procedures and taking into account the rejection rate
– RAMA project at Rolling Shop #10 to prevent bent edges in metal products, reduce damage
to internal coil wraps during loading, as well as improve customer feedback on products shipped on
pin-less frames.
To improve quality control and process performance throughout the entire manufacturing
process, MMK performs audits three times a week, recording the results in a special checklist. The key
objective is to check the conformity of metal products to certification standards and product order
requirements while also taking into account the availability of up-to-date regulatory documents
covering products, acceptance, packaging, and labelling.
In the previous reporting period, the Company introduced multilevel comprehensive audits of
production areas at MMK’s steelmaking and rolling mills. These quality audits check the conformity of
shipped metal products and inventories to regulatory documents, as well as the conformity of critical
process parameters, quality of finished products, labelling, and packaging to operational procedures,
regulatory documents, and order requirements.
In 2021, MMK took the following preventive actions under the QMS procedure:
– Eight internal product audits were conducted in line with the MMK Group’s Standard for
Internal Audits of QMS, EMS, OHS Management System, and Integrated Management System at
Production Units.
– 660 product audits were conducted by the audit commission in line with the Regulations on
the Procedure for Interaction of Business Units When Performing Product Audits, covering Rolling Shops
#4, 5, 8 and 11, coated metal production, and the long products shop.
MMK strives to ensure high product quality through regular training for employees. In 2021, a
total of 12,191 person-courses were taken in technology and management systems and 2,250,190
person-courses in training and pre-shift briefings.
Customer relations
The Company’s product strategy is aimed at increasing the share of high value-added (HVA)
and niche products in total sales while maintaining a highly diversified product portfolio. The main
market segments in Russia where MMK is present are the automotive, fuel and energy, machine
building, construction, and building materials industries. In 2021, the Company grew its supplies of
rolled steel to the Russian shipbuilding sector by more than 1.5 times.
To enhance its product offering for the machine building industry, MMK continuously develops
the rolled product lineup composed of high-strength steel grades under our own MAGSTRONG brand.
In 2021 MMK passed the milestone of 12 million tonnes of commercial metal products shipped,
up more than 16% year-on-year. The increase in production and shipments of metal products was
driven by the completion of our equipment upgrade programme and the recovering demand in the
Company’s key markets.

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Due to MMK’s geographical position, Russia is its priority sales market, primarily the Urals,
Volga, and Western Siberia regions, as well as Kazakhstan, as these destinations offer the shortest
routes for our deliveries. In line with MMK’s strategy and economic viability considerations, the
domestic market remains the priority sales destination, with two-thirds of MMK’s total rolled steel, or
more than 8 million tonnes are shipped to Russian consumers, while shipments to FSU and non-FSU
countries amounted to 1.17 million and 2.83 million tonnes, respectively.
In April 2021, the Company launched a new digital sales channel – its own marketplace
market.mmk.ru, which has been growing successfully. In the reporting period, over 3,300 users were
registered on MMK’s marketplace, bringing its monthly average sales to about 3,000 tonnes in the
fourth quarter. MMK’s plans include further promotion and development of the Corporate Marketplace
through the expansion of its product assortment, including by engaging third-party suppliers, launching
new sales channels and services, and improving all business processes from order placement to product
delivery.
MMK’s sales processes are geared to the need to supply our customers with timely shipments
of high quality rolled steel that fully meets their demands. In 2021, we successfully completed our
Just-in-Time Delivery project. The existing real-time production scheduling system enables more
accurate planning and timely product shipments.
The Company is constantly developing and introducing new digital services and sales channels
while also improving the existing ones. To cover various consumer groups, we have a range of sales
channels in place:
– Direct wholesale supplies to consumers in Russia and FSU countries
– Small wholesale and retail sales through own distribution network and the marketplace
– Wholesale supplies to non-FSU countries via trading companies.
Engagement tools
MMK continues to use coordination councils, video conferences, visits to customer sites for
meetings and joint acceptance of shipped metal products, and joint working groups as its key customer
engagement tools. We have rolled out online questionnaires to collect feedback, with low scores
triggering corrective action, and maintain a single Customer Support Centre.
In 2021, we conducted a survey of the Group’s customers to measure satisfaction with our
products in 2020. The questionnaire contained five questions about product quality, supply discipline
(OTIF), ordering journey, and customer service. The satisfaction targets for 2020 were met in full. In
addition to the main questionnaire’s five questions, the online survey also invited customers to
complete an additional questionnaire to find out about their environmental demands. The results are
collected by MMK’s Environmental Protection Laboratory for analysis and translation into corrective
actions.
The Company also keeps track of customer complaints about products. Here we continue to rely
on our proven mix of communication channels: a single e-mail, integration products, and a mobile
app. In 2021, the Company launched an electronic system for applying the 8D method, based on the
Technical Support. Claims and Complaints information system. The method is used to process all 8D
requests from customers, and the dedicated system enables tracking progress as well as assessing
remedial and corrective measures, including under the 8D method.
Production units develop action plans and introduce respective changes in the product
manufacturing and delivery processes to improve the quality of supplied products. These actions are
based on survey findings (triggered by low scores from customers) and results of investigating
complaints about the quality of metal product supplies or matters raised in customers’ requests.
MMK has a permanent system to handle customer requests, which helps us to make decisions
on developing new product types and fulfil custom orders for tailored products. Plans for 2022 include
the rollout of a new customer relationship management system (CRM), a dedicated software solution
providing a platform to communicate with customers.

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MMK holds regular joint coordination councils with major industry customers, with whom the
Company has long-established relations. These meetings discuss various organisational and technical
aspects of partnerships, and develop plans to improve and operationalise new technologies and product
types.
During the year, the Company also held meetings with more than 40 companies and participated
in 10 conferences and exhibitions, looking mostly to generate high-potential development
opportunities.
MMK specialists and managers participated in the following main industry conferences, also
attended by consumers of metal products:
– Regional Metal and Steel Trading conference (February 2021), report on the regional metals
trading
– Russian Coated Steel Market conference (March 2021), report on the 2021 trends in the
Russian market of galvanised and coated rolled products and MMK products
– Steel Pipes conference (May 2021), report on MMK’s position in the market for flat-rolled
products for pipe manufacturers and prospects for expanding cooperation
– Round table with consumers of coated steel by MMK (August 2021), report on new solutions
and products by MMK for producers of galvanised and coated flat-rolled products
– Russian Metals Market conference (Metal-Expo, November 2021), report on the current state
and future of metal products markets and MMK’s focus areas in the Russian market.
EXCELLENCE IN PROCUREMENT AND SUPPLY CHAIN MANAGEMENT
Procurement and supplier management
2021 saw the continued implementation of category strategies. As a result, over 10 category
strategies were developed and implemented during the year, delivering economic benefits of more
than $7.5 million, which exceeded the target by almost a third.
In accordance with the annual plan for category strategy implementation, category books have
been developed within the established timeframes, further potential savings in procurement categories
have been identified, and long-term contracts have been concluded with loyal suppliers with volume
and loyalty discounts.
A procedure for centralised supply of goods used at different entities and high-value items has
been implemented at the level of MMK Group subsidiaries. This was achieved by pooling the needs of
MMK and the MMK Group, selecting a supplier, and contracting for combined volumes.
The Group uses a category-based approach to procure production inputs such as iron ore, coal
concentrate, ferroalloys, scrap, non-ferrous metals, fuels, and energy. Procured items also include
equipment and its components, materials, and tools, as well as furniture, stationery, and food products
to support operations.
The procurement process of the Commercial Directorate is governed by regulatory and legal
documents posted on MMK’s intranet portal. The key documents are:
– Procedure for Keeping a Unified Procurement Catalogue at MMK
– Inventory Procurement Planning
– Agreements/contracts Award and Follow-up Procedure
– Sourcing procedure
– Guidelines for Reviewing Technical and Commercial Proposals from Suppliers
– Instruction on the Procedure for Developing and Managing Category Strategies, etc.
MMK also has the Procedure Rules for Procurement and Supplier Rating Procedure in place,
formalising the main processes and requirements for supply chain management procedures. The
documents regulating procurement and the supplier interaction process are available at the Company’s
website at the For Suppliers section.
The 2021 reporting year also saw the development of the Supplier Code, with requirements
set out across five key areas:
– Environmental protection

MMK INTEGRATED ANNUAL REPORT
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– Respect for human rights and favourable working conditions
– Occupational health and safety
– Social responsibility and stakeholder engagement
– Conflict of interest, anti-corruption, confidential information protection, philanthropy, and
business ethics.
The Supplier Code is currently pending approval, with roll-out across the Group scheduled for
the second or third quarter of 2022.
Supplier evaluation within procurement procedures is regulated by MMK’s Quality Management
System Organisation Standard. Qualification, cost and non-cost evaluation criteria are used to evaluate
supplier bids against MMK’s internal standards. Other things being equal, preference is given to the
manufacturer / trading house. Prior to ordering a test batch from a new supplier, a decision is made
on whether a technical on-site inspection of the supplier facilities is needed to verify the availability of
required production capacity, qualified staff, inputs / raw materials, and equipment.
Suppliers need to be vetted and are required to comply with the Company’s ethical,
environmental, and social responsibility standards. There is no separate environmental or social
performance checks of suppliers. However, suppliers are selected with due consideration of the criteria
defined in the customer specifications. If the customer specifications require procurement of
environmental or ecological design documentation, the supplier will be evaluated against
environmental criteria.
The supplier selection process also considers the results of technical evaluation. Other factors
taken into account include supplier vetting status determined by the security team and, in case of
existing suppliers, their rating, which is calculated quarterly using integrated indicators for contractual
performance.
Integrated indicators for supplier rating calculation:
– Composite quality indicator: laboratory quality control; feedback from production (on supplier-
related issues)
– Instances of late delivery
– Conformity of physical parameters: quantity/mass and type; geometry
– Certification of quality systems to ISO 9001
– Availability of documents during the initial inspection (contract, bill of materials, delivery note,
technical specification, product quality certificate, etc.).
Supplier selection involves assessing the risks of product non-conformity and failure to ensure
uninterrupted supply of resources to match the Company’s orders. The main risks associated with
procurement and supplier activities are late delivery of equipment, materials, and feedstocks as well
as unapproved changes in technical and quality characteristics of procured items. The supply support
unit is responsible for managing the risks of late delivery and unapproved changes in technical
characteristics.
In 2021, the Company worked with 2,440 suppliers, of which 2,156 were Russian and 284 were
foreign. Russian content in procurement was 71%, including 21% sourced in the Chelyabinsk Region.
Improvements to procurement processes
The MMK Group is committed to driving the continuous improvement of its procurement system,
along with the automation and robotic process automation of processes supporting the needs of
business units and procurement management.
The Commercial Directorate launched the Supplier Relationship Management (SRM) System
Implementation project in February 2021. The SRM is a process that identifies key procurement
categories and designs a strategy for the smart management of those categories.
As part of the project, suppliers have been selected by procurement category and key savings
indicators have been established. Future plans include developing and approving a savings plan and
key metrics for KPI achievement with selected suppliers and roll-out of the target processes to other
procurement categories.

MMK INTEGRATED ANNUAL REPORT
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The SRM process includes three steps:
– Segmenting suppliers
– Developing a supplier relationship management strategy
– Implementing the supplier relationship management strategy
The following procurement categories and initiatives have been selected so far:
– Paints and coatings – an initiative aiming for a 30% warehouse inventory reduction by 2024
– Refractory materials – an initiative to deliver an economic benefit of $5.8 million by 2023
– PPE – an initiative to boost customer satisfaction to 80%
– Ferroalloys – an initiative to deliver an economic benefit of at least $200 thousand per year.
The economic benefits totalling over $2.5 million per year are expected to be achieved through logistics
cost reduction.
The reporting period also saw the launch of a project to deploy UiPath Process Mining system
to analyse and improve the performance of business processes across the Company: a working group
was set up and the project implementation programme was approved.
ANTI-CORRUPTION, BUSINESS ETHICS, AND FEEDBACK MECHANISMS
Anti-corruption
The MMK Group strives to comply with international best practices in anti-corruption and is
guided by the ISO 37001 Anti-bribery Management Systems standard. MMK's anti-corruption system
was analysed and an anti-corruption working group was established during 2021 to implement the ISO
37001 standard. Representatives from a number of units joined the working group, including members
from the Security, Internal Audit, Control, HR, Legal, Economics and Social Policy teams. MMK’s
Security Director is the head of the working group. In line with the risk management standard, the
MMK Group annually assesses corruption risks, paying particular attention to procurement, contracting,
capital construction, and repair operations. The MMK security team is responsible for anti-corruption
efforts, including the elements of due diligence, conflicts of interest, and anti-corruption checks of
candidates for key positions.
In the reporting period, the Anti-corruption Policy was updated and is now pending approval. It
reflects the commitment of MMK and its management to high ethical standards, fair business practices,
corporate culture development, and maintenance of good business reputation. The Anti-corruption
Policy sets out key requirements for corruption prevention and anti-corruption compliance. The Policy
applies to all employees regardless of their position and those authorised to act for and on behalf of
MMK and MMK Group subsidiaries.
In 2021, MMK made a decision to implement a unified compliance system in line with the ISO
37301 Compliance Management Systems standard. It will cover all compliance frameworks including
ethics, corporate governance, risks, and compliance. MMK has inherent compliance risks primarily
related to production, workforce, procurement, sales, ethics, anti-corruption (including conflicts of
interest), and health and safety.
In 2021, The Russian Union of Industrialists and Entrepreneurs audited MMK and assigned it a
Class A2
46
rating in the Anti-corruption Ranking of Russian Business. MMK also joined the Anti-
Corruption Charter of Russian Business in the reporting year.
Partial automation of review, identification, and prevention of conflicts of interest were
implemented during the reporting period. The MMK Group runs regular internal checks for conflicts of
interest, with follow-up recommendations. As a result of inspections, two cases of corruption related
to conflicts of interest were prevented during the reporting year.
46
Companies with high level of anti-corruption compliance but more prone to corruption risks (as compared to Class A1
companies). This rating indicates a low level of associated threat to investors, creditors, business partners, and other
stakeholders.

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Ethical conduct
The Risk Management and Internal Control Unit is responsible for organising business ethics
related activities. The unit is also responsible for the Ethics Committee work and ethics hotline
operation. The Ethics Committee deals with a wide range of matters related to ethics and business
conduct violations. The Risk Management and Internal Control Unit annually approves an activity plan
for the Internal Audit Department. The department conducts separate audits to look into compliance
with the principles and values reflected in our Code of Ethics. In 2021, violations were mostly
associated with unethical behaviour: interpersonal conflicts occur due to the fact that MMK has a large
workforce.
The Code of Ethics was updated and approved in 2020, with compliance mandatory for all
employees of the MMK Group. It sets out corporate norms and principles which are the cornerstone of
ethical business conduct. The Code of Ethics governs relationships not only within a team but also
between employees and other stakeholders.
The MMK Group closely monitors all related party transactions, with a system in place to control
and protect trade secrets and insider information use. It is prohibited to use this type of data for
personal purposes or in violation of applicable legislation. Regular checks are run to look into trade
secret protection.
MMK performs annual tests of employee knowledge and compliance with the Code of Ethics.
Employee acknowledgment forms for the Code of Ethics and violation reports are checked as well. In
the reporting period, The MMK Group established a Programme for Ethical Norms Development and
Promotion and is starting to roll out a relevant employee training programme through its Personnel
Department. The Group trains its employees in ethics and has developed self-study training materials.
MMK employees are also tested on their knowledge of the Anti-corruption Policy.
Hotline
MMK’s Security Directorate operates a 24/7 confidential whistleblowing hotline in line with our
Anti-corruption Policy. This is one of the most effective communication channels for all stakeholders.
The hotline receives reports on violations and breaches of labour safety, human rights, labour laws,
and suspected corruption, as well suggestions to improve anti-corruption procedures and controls.
MMK employees and other individuals can send messages using the mail box and email address
indicated on the official website. In 2021 total of 151 registered reports were received via the Security
Directorate Hotline.
A dedicated ethics hotline was also launched at MMK. All reports are handled and investigated
with particular attention paid to those presenting concrete evidence of wrongdoing. In 2021, no
business ethics violations were reported via the hotline.
2022 PRIORITIES
Next year, the MMK Group plans to:
- Lease out at least 67% of the Park’s commercial space
- Upgrade energy and transport facilities
- Continue implementation of joint initiatives with suppliers to improve the procurement process
performance.
- Implement ISO 37001 Anti-bribery Management Systems and prepare for ISO 37001
certification
- Maintain leading positions in supplying in the Russian and FSU markets by capturing the
opportunities in import substitution, participating in major investment and government-sponsored
infrastructure projects, and strengthening its competitive edge through better customer service, a

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focus on sales of premium niche products, further improvement of the corporate marketplace, and
increased warehouse sales through own distribution network
- Continue to use the 8Ds method in dealings with consumers and suppliers, develop
visualisation of operations at production units (Button information system, Svetofor, etc.), and boost
personal ownership in production staff
- Enhanced awareness raising for the Code of Business Ethics, ethical principles (promotion
booklets, leaflets, and better communication), and the hotline
- Strong and comprehensive communication of anti-corruption information and Anti-corruption
Policy to employees and other stakeholders using all available engagement channels
- Closer attention to the business conduct trainings for employees (hosted both in person and
remotely)
- Mandatory online trainings structured by function and employee position.

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RISK MANAGEMENT
RISK MANAGEMENT SYSTEM
Risks are identified, analysed and managed at all levels of the MMK Group’s business processes.
The risk-based approach has been embedded in the managerial, investment and operational decision-
making processes.
Our risk management system is in line with international standards and best practice in risk
management. Its effectiveness has been repeatedly confirmed by independent audits, with auditors’
recommendations for further improvement rigorously implemented. Risk prevention helps us achieve
our goals.
The MMK Group’s risk management system is integrated with the Group’s strategy, aspirations
and vision. We use a common language to ensure consistent understanding of all aspects of risk
management. The Group has a Risk Management Policy in place that outlines its key risk management
principles and approaches.
The Board of Directors is updated on, and involved in, risk management, including through:
- approving the Risk Management Policy
- reviewing and approving a risk-based strategy
- approving and reassessing risk appetite
- monitoring and evaluating the performance of the risk management system.
We are rigorous in disclosing – honestly and objectively – information about risks that have
materialised. We continually review and improve our approaches to risk governance and risk
management, keeping in mind relevant changes in internal and external environments.
The roles, duties and responsibilities of those who are accountable for risk management are
governed by corporate regulations complying with ISO 31000, the Code of Corporate Governance and
COSO ERM 2017.
RISK MANAGEMENT CULTURE
MMK established a Risk Management and Internal Control Unit to enable an effective risk
management system. Its risk management responsibilities include designing and developing the risk
management approach, organising training for employees, coordinating efforts within the risk
management system between units, and preparing consolidated risk reports.
The Unit is committed to the continuous improvement of its employees’ risk management
knowledge and skills. The Risk Management and Internal Control Unit organises regular training on the
basics of the risk management system for MMK business process owners and Group entities, and also
provides advice and guidance and discusses matters related to risk management.
In 2021, the Group took the following measures to enhance its risk management system:
- Updated the risk appetite statement of the MMK Group
- Updated the Group’s risk management standard
- Trained unit heads and their deputies responsible for business process risks in procedures
for risk identification and assessment as well as for the development and follow-up of risk-mitigation
measures
- Launched a risk management automation project.
DIGITISATION OF THE RISK MANAGEMENT PROCESS AND INTERNAL CONTROL SYSTEM
MMK’s current priority in improving the risk management process is the implementation of its
Digitisation of the Risk Management Process and Internal Control System project. The project aims to
create an automated system that will shape a single information environment for storing and managing
structured data sourced from the risk management and internal control systems. The implementation
of a single digital solution for processing up-to-date data will help ensure the division of responsibilities
and assign ownership for the effective operation of control procedures and monitoring of risk events,
fast reporting on the performance of the risk management and internal control systems with a high

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level of data completeness and reliability along with flexible settings, and automation of key controls
for business processes in line with best practices, while at the same time providing a tool for further
development of risk control procedures.
RISK TOLERANCE
The MMK Group’s risk appetite statement is set out in a formal document that is periodically
reviewed. The document is designed to make sure that day-to-day operational decisions at all levels
of management are made within established limits and to provide reasonable assurance that business
objectives will be achieved.
The MMK Group has zero risk appetite for the following events:
- Industrial accidents
- Equipment downtime as a result of the ban on the use of aggregates due to violations of
environmental legislation
- Accidents that result in severe or fatal injuries to employees
- Loss of confidential information and/or production shutdowns due to cyber attacks
- Strikes or other collective actions to disrupt the Group’s activities
- Corruption.
RISK MANAGEMENT PLAN AND STRATEGY
Our risk management strategy aims to drive the sustainable development of the MMK Group
through risk-based decision making. It is implemented through:
- Identification and assessment of risks in day-to-day operations
- Identification and assessment of risks in projects and initiatives
- Development of risk-mitigation measures
- Risk monitoring
- Communicating to management about potential risks and those that have materialised.

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MMK GROUP RISK GOVERNANCE FRAMEWORK
Board of Directors
(decisions on risk management)
Approval of Risk
Management Policy
Board of
Directors
Audit
Committee
CEO
Internal audit
department
Risk owners
Risk
Management
and Internal
Control Unit
(methodological
support and system
coordination)
Ensuring effective
operation of the system.
Approval of regulatory
documents governing
business
processes
Risk identification
and analysis based
on audit results
Risk identification
and analysis
Preparation of risk
registers that are
business-process-specific
Preparation of the risk
map for the MMK Group;
Preparation of a
consolidated risk report
for the MMK Group
Review of the risk map
for the MMK Group
Approval of the risk map
for the MMK Group
Development of risk
management activities
Implementation of risk
management activities
Risk monitoring
All necessary
information on
the system’s
performance
Review of the risk
management system
Review of the MMK
Group’s consolidated risk
report; preparation of
recommendations on the
system performance
assessment
Risk management review

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RISK MANAGEMENT PROCESS
Risk identification and documentation
Within the MMK Group’s risk management framework, risks are identified based on business
process objectives. Identified risks are shown in risk registers that are business-process-specific, with
the most significant risks identified within the MMK Group’s risk map.
Risk assessment
We evaluate all identified risks for their potential quantitative and qualitative impacts on
business and for their likelihood of occurrence. We also rank them by significance.
Quantitative assessment is used to supplement qualitative assessment and to compare the risk
magnitude to the cost of its mitigation. If the risk materialises, the quantitative assessment shows the
damage from the influence of the risk to the Company’s EBITDA. We use approved methods to assess
specific significant risks to the Group.
Business-process-specific risk dashboards and the MMK Group’s risk map are used to record
and track each risk throughout the risk management process.
Risk impact assessment
Level of impact
Quantitative
assessment
(RUB million)
<10
10 –100
100 –1 000
1 000 –10,000
>10,000
Qualitative
assessment
Very low
Low
Medium
High
Very high
Accident
Dangerous
situations
Minor accidents
to be
investigated
Accidents resulting
in severe injuries
Fatal accident
Multiple-fatality
accident
Social tensions
Isolated cases
of discontent
Strike by key
specialists
Strike by a business
unit
Large-scale strike
Collective actions to
disrupt MMK Group’s
activities
Likelihood of risk realisation
Quantitative
assessment (%)
0–9.99
10–19.99
20–49.99
50–89.99
90–100
Qualitative
assessment
Very low
Low
Medium
High
Very high
Risk management decision making
Based on risk assessment, the Group selects its response to risk:
- acceptance
- mitigation
- transfer to a third party
- avoidance.
The outcomes of risk management activities are used to reassess the risk and evaluate the
effectiveness of these activities.
Monitoring and reporting
Twice a year, the Group runs a risk realisation monitoring procedure for the key risks shown on
the MMK Group’s risk map.
Risk monitoring results covers:
- Information about risk realisation during the reporting period
- Causes of risk realisation
- Completed risk mitigation activities.

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At the business process level, risks are monitored by business process owners.
The MMK Group’s consolidated risk report includes:
- The MMK Group’s risk map reviewed by the Audit Committee of MMK’s Board of Directors and
approved by order of the CEO
- Risk monitoring results for the MMK Group’s risks reviewed by the Audit Committee of MMK’s
Board of Directors.
The Board of Directors reviews the risk management system performance report prepared by
the internal audit department on an annual basis.
THE MMK GROUP’S RISK MAP
Key for principal risks table
Our strategy
Risk trends
Change in risk level
To be the best supplier
High or very high
Increase
To be a leader in operational
excellence
Medium
Decrease
To be a responsible,
sustainable business (ESG)
Low
- No change

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PRINCIPAL RISKS
For each of the major risks, including those that are sustainability-related, we have identified the related causes, material topics, and types of capital, and developed a list of risk mitigation
measures.
Risks
Drivers
Impacts
Material topics
Capitals impacted
Risk mitigation
Production risks
Industrial accidents and
other incidents
- Failure to comply with operating
guidelines and equipment operation
procedures
- Use of substandard materials, supplies
and equipment
- Failure to comply with procedures for
repairs, maintenance and industrial safety
examinations
- Disruption of the
continuous operation of
critical equipment
- Injury or death of
employees
- Equipment restoration
costs
- Reputational losses
Environmental:
5 Air emissions
6 Water management
Social:
7 Occupational health and safety
9 Human rights
Economic:
13 Supply chain
14 Economic performance
- Financial
- Manufactured
- Natural
- Human
- Social and relationship
The Company takes measures to prevent emergencies and ensure safe
operating processes:
- Monitoring the compliance of raw materials, supplies and equipment delivered to
warehouses with stated requirements and quality specifications
- Conducting technical audits of suppliers
- Improving the unified system for training and assessing employees’ knowledge
- Regular assessments to check employees’ knowledge of technical instructions
- Training and certification of all newly hired employees
- Staff upskilling
- Scheduled repairs, maintenance, upgrades and modernisation of fixed assets on a
timely basis
- Unscheduled inspections of buildings and structures, identifying instances of non-
compliance with regulations, drawing up a plan for repair work
Defective products
- Equipment failures
- Failure to comply with operating
guidelines and equipment operation
procedures
- Use of substandard materials, supplies
and equipment
- Undermining trust in the
Company as a reliable
supplier of high-quality
products
- Loss of customers
Economic:
13 Supply chain
14 Economic performance
- Financial
- Social and relationship
Our customer focus, enhanced quality management system, and continuous
improvements to processes and product quality guarantee high quality
products for our customers.
MMK carries out the following risk mitigation measures:
- Installing technology compliance controls at production facilities
- Continuous improvement of employee skills
- Comprehensive inspections of technology compliance and multi-level audits across
business units
- Internal and external audits of the quality management system
- Control of technological documentation
- Preparing and reviewing specifications for raw materials and requirements for
suppliers
- Monitoring the quality of incoming raw materials, fuel, refractory materials, semi-
finished products and other supplies
- Testing new materials
- Technical audits of suppliers
- Scheduled preventive and corrective maintenance of production equipment
- Implementation of quality control programmes at production units
- Audits of production units against a single checklist
- Investigating industrial incidents and accidents
Market risks
Decrease in the price
spread between the
average price of rolled
metal and the cost of the
basic raw material basket
- High volatility in sales and raw materials
markets
- Strong competition
- Monopolisation of raw materials markets
- Ineffective development of the sales
network
- Limited captive raw materials base
Decline of the MMK Group’s
financial performance
Economic:
13 Supply chain
14 Economic performance
Financial
We take necessary and reasonable steps to reduce this risk:
- Monitoring the industry on a monthly basis and identifying its key drivers
- Reallocation of product flows between markets and individual market segments
- Long-term agreements with suppliers and customers
- Diversification of key raw material suppliers and consumers
- Monitoring of opportunities to expand its own raw material base
- Using a strong marketing policy
- Shifting production towards products that are more marketable
- Offering alternative terms, using a flexible pricing policy
- Product quality improvement and fast response to product quality complaints

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Financial risks
Non-fulfillment of
obligations by customers
- Shipments under unsecured deferred
payment contracts
- Financial and economic insecurity of
customers
Decline of The Company’s
financial performance
Economic:
14 Economic performance
Financial
The Company implements the following measures to minimise the risk:
– increases the share of agreements secured with bank guarantees and sureties, uses
factoring arrangements for payments
– evaluates customer solvency for deferred payment shipments of products, sets
shipment limits.
Sustainability risks
Occupational health and
safety (OHS) risk
- Insufficient risk awareness and unsafe
occupational behaviour
- Form-over-substance approach to OHS
training
- Inadequate maintenance of facilities and
equipment
- Deterioration of the
Group's reputation
- Deterioration of the
employees’ health
Social:
7 Occupational health and safety
9 Human rights
10 Employee engagement
Social and relationship
The occupational health and safety system is one of MMK’s sustainability drivers. The
Group maintains an ongoing focus on preventing accidents, with a particular emphasis
on OHS awareness and training as well as providing employees with a safe working
environment and the necessary personal protective equipment. Key risk mitigation
activities:
– Improving video- and VR-based training and drill programmes to deal with unsafe
actions
– Rolling out video analytics to cover working areas and robotic automation solutions for
hazardous operations
– Developing and automating behavioural safety audits
– Establishing safety areas, installing additional guardrails, and avoiding human
presence in highly hazardous areas
Environmental risk
- Obsolete technology and worn-out
environmental facilities
- Non-compliance with the environmental
laws of the Russian Federation and ISO
14001:2015, the international standard
for environmental management systems
- Failure to comply with environmental
regulations for production facilities,
maintenance and repairs
- Environmental
degradation
- Penalties
Environmental:
1 Energy efficiency
2 Biodiversity
3 Waste management
4 GHG emissions and climate change
5 Air emissions
6 Water management
Social:
7 Occupational health and safety
9 Human rights
Economic:
14 Economic performance
- Financial
- Natural
- Social and relationship
Indispensable elements of MMK’s strategy that drive its long-term and sustainable
development include the continuous reduction and prevention of harmful environmental
impacts as well as the deployment of the best available technologies:
– Upgrading existing facilities and applying advanced environmental solutions when
constructing new production facilities
– Automating industrial emission management systems
- Implementing a comprehensive plan of initiatives to reduce emissions
Social tension
- Changes in headcount
- Insufficient wage indexation, leading to
lower living standards
- Perceived unfairness in the distribution of
workload and incentives among
employees
- Deterioration of the social
well-being and overall
morale of our workforce
- Negative impact on the
Company’s activities
Social:
7 Occupational health and safety
8 Local community development
9 Human rights
10 Employee engagement
Economic:
14 Economic performance
- Financial
- Intellectual
- Human
- Social and relationship
MMK implements a range of social programmes to help improve how people deal with
life’s problems:
– Health treatment and other medical services for employees
– Improving the health of employees and their families
– Social support for non-working retirees, people with disabilities, and other people in
need
– Supporting mothers and large families
The MMK Group also raises its employees’ wage rates and salaries on an annual basis,
while expanding serviced areas, promoting multi-skilling and introducing performance-
based payments and bonus programmes to provide additional financial incentives for
employees and drive personal responsibility
Climate risk
- Introduction of a carbon border
adjustment mechanism (CBAM), which is
the application of economic levers in the
supply of products to the
- European market (carbon price)
- Increased cost of fossil fuels as compared
to carbon-free fuels due to CBAM
- Increased number of climate-related
emergencies (heavy precipitation,
droughts, higher temperature of water
used to cool the equipment)
- Increase in capital
expenditures for the
introduction of new
technologies
- Increase in the cost of
purchasing fuel resources
- Disruption of production
processes
- Damage to the
environment
- Accidents that caused
injuries to employees
- Reputational losses
- Additional duties, fines
and sanctions
Environmental:
1 Energy efficiency
2 Biodiversity
3 Waste management
4 GHG emissions and climate change
5 Air emissions
6 Water management
Social:
7 Occupational health and safety
9 Human rights
Economic:
11 Corporate governance
13 Supply chain
14 Economic performance
- Financial
- Manufactured
- Intellectual
- Natural
- Human
- Social and relationship
We implement the following measures to reduce this risk:
– Assess the carbon intensity of our production processes and develop measures to
reduce emissions using available technology and planned investment projects
– Develop a climate strategy to reduce GHG emissions
We developed an assessment methodology and assessed climate risks

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Economic security risks
Cyber risk
- Software and hardware vulnerabilities
within automated process control
systems and information systems
- Failure to comply with information
protection and software licensing
regulations
- Abuse of office/human error
- Failure of key IT infrastructure
components within automated process
control systems and information systems
- Poor employee awareness of information
security
- Disruption of the
continuous operation of
critical equipment
- Loss of confidential
information
- Reputation losses
Social:
7 Occupational health and safety
9 Human rights
10 Employee engagement
Economic:
11 Corporate governance
12 Anti-corruption and ethics
13 Supply chain
14 Economic performance
- Financial
- Manufactured
- Intellectual
- Human
- Social and relationship
We take the following measures to reduce these risks:
– Implementing technical measures to raise employee awareness about information
security issues
– Appointing individuals responsible for information security in the Company’s units
– Designing and implementing a security system to protect critical information
infrastructure
– Security assessments of key information systems and resources
– Anti-virus protection and software security update management
– Developing and implementing a set of measures to protect information and provide
the necessary licensed software
– Automated control of user access rights for special-purpose information systems
– Monitoring and managing information security events
– Building resilient IT and telecoms infrastructure
– Providing utility infrastructure and power supply at data centres
In addition, a quantitative assessment of cyber risk was carried out using a specially
developed methodology.
Corporate fraud
- A lack of clear and appropriate
procedures and controls for business
processes in regulations
- Inadequacy of high-level information
security requirements to handle
emerging threats
- Failure by employees to comply with
their job descriptions
Financial losses
Social:
10 Employee engagement
Economic:
11 Corporate governance
12 Anti-corruption and ethics
13 Supply chain
14 Economic performance
- Financial
- Manufactured
- Intellectual
- Human
- Social and relationship
The MMK Group maintains an ongoing focus on building a strong corporate ethos to
foster a control culture and we implement the following measures:
- Improvement of internal control systems
- Developpment and update of controls
- Drafting internal regulations (e.g. Code of Ethics), policies, procedures,
- and reporting forms for monitoring its asset integrity activities
- Setting up dedicated hotlines
Compliance risks
Sanctions for violation of
laws on the use of mineral
resources
- Subsoil use not covered by mining
licenses
- Ambiguity of law enforcement practices
relating to subsoil legislation
Compensation for damage
caused as a result of
violation of the
requirements of subsoil
legislation
Economic:
11 Corporate governance
14 Economic performance
- Financial
- Social and relationship
The Company has taken the following measures:
- The boundaries of mining areas have been brought into compliance with licences by
amending the relevant licences
- Official confirmations were obtained

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ASSESSMENT OF THE MMK GROUP’S PROSPECTS
The modern world is changing fast, creating both new challenges and new opportunities.
Climate change and the green agenda driving the innovative technology development and adoption,
and supported by digitalisation are the trends that are set to impact the development of the steel
industry in a big way. MMK’s system for monitoring external changes, emerging technologies, and new
consumer demands enables agility and speed in responding and adapting to the industry’s new
operating conditions.
The MMK Group enterprises use a uniform approach to drafting a long-term investment
programme focused on enhancing production efficiency and driving the adoption of green technologies.
Continuous efforts to improve efficiency help MMK consistently sit at the lower end of the global cost
curve, among the world’s efficiency leaders. To maintain its leadership in the premium product market
in Russia, MMK is expanding its production capacities and product range.
The MMK Group’s strategy leverages our prime geographical advantages by suppling products
to the Russian regions with the highest levels of metal consumption. MMK supplies more than 70% of
its products to the Russian market, so we believe MMK is among the companies that stand to gain the
most from national infrastructure projects.
Efforts to draft and approve the MMK Group’s consolidated budget imply an annual planning
process, including drafting a short-term (year ahead) financial forecast which is updated on a quarterly
basis. The budgeting process is driven by the inputs provided by each Group company and the results
of potential risk assessment. The MMK Group’s draft consolidated budget is reviewed and approved by
the Board of Directors.
As part of the review and approval procedure for its long-term (ten-year) strategy, MMK applies
a long-term planning process comprising the preparation of a long-term (ten-year) financial forecast.
The forecast is prepared based on the information received from each Group company and on the
results of potential risk assessment. The long-term strategy is reviewed and approved by the Board of
Directors.
GOING CONCERN
When assessing the Group’s ability to continue as a going concern, we consider preparing its
financial statements on a going concern basis. Following the review of the Group’s consolidated budget
by the collective executive body (Management Board), which also considered the risks of raw material
and finished product price volatility, unused credit facilities, and debt maturity profile, the Management
Board came to reasonably expect that the Group has adequate resources to continue its production
operations in the foreseeable future. In this context, the going concern basis continues to apply in the
preparation of the consolidated financial statements.

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GOVERNANCE
CHAIRMAN’S LETTER
CHAIRMAN
VICTOR RASHNIKOV
«
Dear shareholders!
In 2021, we delivered record results across multiple key
performance metrics. We achieved this thanks largely to the well-
coordinated, effective efforts of the Board of Directors, executive
team and MMK employees in the face of adversity brought on by the
ongoing pandemic and the volatile external environment.
The Board of Directors maintained its focus on increasing total shareholder
return, supporting market capitalisation growth and generating high dividends while
keeping borrowing low. Board meetings throughout the year focused on health and
safety, the implementation of the 2025 Strategy, sustainable development, climate
change and decarbonisation, operational resilience, and digitalisation and
cybersecurity projects. The Board of Directors’ activity plan that has been approved
for the 2021/2022 corporate year includes matters related to the Company’s strategic
development and priorities.
Read more on pages 114-115.
Listening to stakeholders
In line with our recognised strategy, we operated the business taking the
interests of all stakeholders into account. MMK places a particular emphasis on
building a constructive dialogue with its stakeholders, and the Board of Directors is
directly involved in this effort. This allows us to talk to stakeholders about, for
example, our work and progress across ESG initiatives as well as on the transparency
of our corporate governance. Our engagement with stakeholders also helps us to
identify and understand the biggest concerns of each type of stakeholder, so we can
improve performance and disclosures in those highlighted areas. MMK’s annual
Investor Day held on 7 December 2021 as part of these efforts, provided an
opportunity to discuss the main current and future trends in the global and Russian
steel markets, key drivers of metal consumption, as well as the progress on MMK’s
2025 Strategy.
Read more on pages 29-33.
Committed to high standards of governance
As our corporate governance continues to improve, we keep a close eye on
external changes and requirements, respond to challenges and implement Russian
and international best practices. Throughout its operations, MMK is strictly guided by
international and Russian corporate governance standards. These include the
provisions of the Corporate Governance Code recommended by the Bank of Russia,
the UK Corporate Governance Code, the listing rules of the London and Moscow stock
exchanges, the recommendations of the Bank of Russia on disclosing non-financial
information, and the commitment to UN Sustainable Development Goals.
High standards of governance help us drive progress towards our sustainability
goals. We welcome the decision made by the IFRS Foundation during COP-26 to form
an International Sustainability Standards Board to develop a global baseline of
sustainability disclosure standards.
Read more on pages 100-126.
Changes to the Board
In 2021 three directors resigned from the MMK Board after many years of
valuable service and I thank them heartily for their enormous contribution. In order

MMK INTEGRATED ANNUAL REPORT
102
to fill their shoes, the composition of the Board of Directors was refreshed in 2021 to
include three new independent directors. We welcome new members of the Board who
bring expertise and experience from a wide range of industries, including retail,
financial services, data analytics and telecommunications. The renewed composition
allowed us to maintain the diversity of the Board of Directors, with women accounting
for 20% of its members, in contrast to an average of 5% in Russian companies. When
we make such appointments, we are mindful of the need to support the Company’s IT
and digital transformation and consider its long-term requirements. The Board’s
competencies are fully aligned with the Company’s current strategy and needs.
Focus on continual improvement
In 2021, based on the results of an external board performance evaluation, the
Board of Directors developed and approved a new Corporate Governance
Improvement Programme to run until 2024. You can read more about this programme
on page 106. This provides, among other things, for deeper board involvement in
strategy implementation and risk management, adoption of modern approaches to
stakeholder engagement, expansion of the Company’s ESG agenda, development of
investor communications, and improvement of MMK’s investment appeal.
I have been closely involved with this programme, and I encourage all Board
members, managers, specialists and employees involved in corporate governance to
attend strategic and training sessions, some of which are facilitated by external
experts. This initiative has generated a good deal of enthusiasm and interest, and we
intend to continue with it next year.
Once again, I would like to thank the Board members, the whole executive
management team and MMK employees, as well as our shareholders and partners, for
the productive collaboration and achievement of all of the Company’s goals and
objectives.
I am confident that the Board and the Company will remain
committed to its chosen strategy while maintaining the highest
standards of corporate governance. In 2022, the Board will continue
to pay close attention to health and safety, sustainable development
and climate change, as well as all the challenges that the Company
and society at large might face.
»

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OUR CULTURE
With 90 years of tradition behind us, we at MMK are fiercely protective of the culture that our
predecessors spent many decades working to create. The company’s early pioneers would not have
called it culture, but they were all too aware that there was a way of doing things that expressed and
defined what MMK stood for.
As then, today we stand for value and quality; we aim to cultivate partnerships with all our
stakeholders, we take care of the safety, health and wellbeing of our employees and do all we can to
make MMK a place where people are rewarded fairly and can fulfil their ambitions. MMK continues to
be a company that is always looking to improve, be that its business processes and methods, the
opportunities it opens up for its people, or the quality of its products.
Our history and identity and those of Magnitogorsk are inextricably linked; the town was shaped
by our arrival there in the 1930s. MMK is the primary employer in the region and we recognise the
significance of our business on the social, economic and environmental health of our home town. It is
in our DNA to improve the quality of people’s lives in Magnitogorsk and to create opportunities in the
region.
Our culture means that our business practices are driven by integrity and transparency, so we
have well-established mechanisms in place to counter corruption and all forms of wrong doing and this
robust governance means we build trusting relationships with shareholders, investors and employees.
In recent decades, we have come to understand the effect that our business can have on the
environment more broadly and we recognise the importance of valuing and protecting the world around
us. Our culture reflects this 21st century priority.
The MMK culture, built over 90 years, is one of our most precious assets. We protect and nurture
it so it can continue to steer us for many years to come.
OUR APPROACH
MMK’s strong approach to governance, combined with its robust financial performance, reflects
our position as a leading modern Russian company and a reliable partner for investors in Russia and
around the world. The Group is guided by international and Russian corporate governance standards,
including the provisions of the UK Corporate Governance Code, the Corporate Governance Code
recommended by the Bank of Russia, and the listing rules of the London and Moscow Stock Exchanges.
MMK’s corporate governance principles and rules are set out in the Company’s Code of
Corporate Governance, which was revised and approved by decision of the Board of Directors on 20
December 2019 (available on MMK’s website
47
). The principles and rules are as follows:
– Protection of shareholder and investor rights
– Compliance with all applicable legislation and internal regulations
– Equal treatment of all shareholders (including foreign and minority shareholders)
– Mutual trust and respect for all stakeholders, open dialogue
– Integrity of management
– Commitment to the continuous reduction and prevention of harmful environmental impacts,
an approach that will provide an environmental perspective to new development projects, and the
deployment of the best available technologies.
MMK follows these principles strictly and monitors new corporate governance requirements and
best practices, continuously improving its own approach. This is achieved by, among other things:
– An annual performance evaluation of the Board of Directors
– The Board of Directors review of the report on compliance with the Corporate Governance
Code
47
All MMK’s internal documents are available on the official website.

MMK INTEGRATED ANNUAL REPORT
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– The Corporate Secretary’s updates to the Board of Directors on changes in regulation and
corporate governance practices
– Communicating with shareholders and investors and other stakeholders.
The Company engages proactively with stakeholders, including minority and foreign
shareholders, on corporate governance matters. MMK adheres to a corporate-wide policy that applies
to all its subsidiaries and affiliates and other legal entities associated with the Group.
The MMK Group’s Code of Ethics: guiding and reflecting our culture and values
Over time, we are building a culture of success, in which achievement is fairly rewarded.
Reinforcing this culture is a range of policies and initiatives, supported and endorsed by the Board of
Directors, that help our people to live by the MMK values. We know that our people are what make
MMK the successful company it is. We expect our employees to meet high standards of business
conduct and professional competence. Corporate values, principles and requirements that underpin
our business ethics are set out in the MMK Group’s Code of Ethics.
The Board of Directors is confident that the corporate culture and values defined in the MMK
Group Code of Ethics and other internal documents ensure the confidence of the investment community
in the MMK Group and contribute to the loyal attitude of shareholders to the Company.
For more details on MMK’s key principles and values in the field of ethics, see page 89.
Compliance with best practices
The Company adheres to most principles of the Corporate Governance Code approved by the
Bank of Russia on 21 March 2014.
To assess its compliance with the Code’s principles, the Company used the Recommendations
on Preparation of the Report on Compliance with the Principles and Recommendations of the Corporate
Governance Code of the Bank of Russia.
In 2021, MMK fully or partially complied with 77 principles (97.5%) and did not comply with
only two out of 77 (chart below).
For more details, see the Appendices to this Integrated Annual Report.
Compliance with the principles and recommendations of
the Corporate Governance Code
Following the recommendations of MMK’s Code of Corporate Governance as well as best
corporate governance practices, the Company uses the following mechanisms and tools (in accordance
with its Charter and internal regulations):
– Setting the deadline for shareholders to submit proposals for the agenda of the Annual General
Meeting at 60 days after the end of the financial year
– Establishing rules for responding to shareholders’ questions during the meeting
– Providing e-mail as an additional means of shareholder communications:
shareholder@mmk.ru
– Offering an electronic voting system (shareholder page), thus enabling every shareholder to
exercise their right to vote freely and in the simplest and most convenient way
– Expanding the list of matters to be decided on by a majority vote of all elected members of
the Board of Directors and the list of matters to be decided on by the Board of Directors through in-
person voting
91%
6%
3%
Full complience
Partial complience
Non-complience

MMK INTEGRATED ANNUAL REPORT
105
– Putting in place a collective executive body, the Management Board, whose main functions
are to review the MMK Group’s financial and economic plan (budget), forecast financial and economic
indicators for the MMK Group, approve representatives in the MMK Group’s companies and approve
directives for the representatives to take decisions at Annual General Meetings and meetings of the
Board of Directors
– Establishing representatives within the MMK Group companies to improve the quality of
management decisions. The representatives are guided by the Regulations on Representatives
approved by MMK’s CEO and the directives approved by MMK’s Management Board
– Requiring the Board of Directors to approve resolutions not only on the transactions provided
for by Russian laws but also on transactions with a value exceeding 10% of the book value of the
Company’s assets, as well as on transactions to dispose of real estate regardless of the transaction
value
– Complying with the procedures for succession and selection of nominees to the Board of
Directors set out in MMK’s Regulations on the Board of Directors
– Ensuring MMK’s governing bodies use electronic technologies in accordance with its Charter
and internal regulations
– Holding regular, open strategy sessions involving independent directors to discuss the
implementation of the Company’s portfolio of strategic objectives and its KPI system
– Paying particular attention to sustainability matters. The ESG approach is embedded in every
aspect of MMK’s business and informs our decision making, with sustainability focus areas integrated
into the Company’s strategy. MMK contributes to the development of its core operating region, helps
promote the social well-being of local residents and conserve the environment by delivering on its
economic commitments and social and environmental agenda.
Disclosure policy (information policy)
In 2008, the Board of Directors approved MMK’s Information Policy. The CEO is responsible for
announcing the Company’s performance.
The Information Policy of MMK is aligned with applicable Russian laws, the Corporate
Governance Code recommended by the Bank of Russia, rules and requirements of Russian and British
securities market regulators and Russian and international best corporate governance practices.
The Company’s Information Policy is focused on promoting the rights of shareholders and
investors to material information relevant to taking investment and management decisions, as well as
on protecting sensitive information, disclosure of which may result in damages to the Company and its
shareholders.
The key principles of the Information Policy are:
– Ensuring the right of shareholders, investors and other stakeholders to information in line
with applicable Russian laws
– Regular, consistent and timely information disclosure
– Complete, up-to-date and reliable information, comparability of disclosed data availability
– Equal and unhindered access to information and documents for shareholders upon request
– Balance between transparency and confidentiality.
Board evaluation
Every year since 2008, the Board of Directors has evaluated its own performance and that of
its members and committees. This helps to boost the Board of Directors’ efficiency, identify areas for
improvement and improve MMK’s corporate governance practice. The results of the evaluation are set
out in MMK’s Integrated Annual Report.
To conduct an independent performance evaluation of the Board of Directors, MMK regularly
(at least once every three years) engages an external organisation (a consultant) that must be
approved by the Board of Directors upon a proposal from the Nomination and Remuneration
Committee.

MMK INTEGRATED ANNUAL REPORT
106
Following the evaluation, the Board of Directors approves an action plan to improve the
Company’s practices. On 25 October 2021 the Corporate Governance Improvement Programme for
2024 was approved. The Corporate Governance Improvement Programme outlines the following areas
focus areas: strategy; risk management and internal control; composition and skills mix of the Board
of Directors; meetings of the Board of Directors and its committees; remuneration system for the
Board of Directors, executive bodies, and other key executives; stakeholder engagement, ESG,
information disclosure.
On 28 December 2021, the Board of Directors decided to engage a competent external
consultant to conduct an evaluation of the performance of MMK’s Board of Directors, Board members
and Board committees in 2021.
Board effectiveness review 2021
Following the 2021 performance self-evaluation, members of the Board of Directors noted that
corporate governance at MMK complies with Russian and international best practices and demonstrates
annual improvement.
The Company’s strengths and achievements include a high level of corporate social
responsibility, an ongoing focus on ESG best practices, and improved ESG ratings.
The more diversified composition of the Board of Directors, increased openness of discussions
during meetings, and active involvement of the Board Chairman and members in engagement with the
investor community received a positive evaluation.
Board committees were commended for their excellent organisation, constructive approach,
discipline, compliance, and consistency.
Board members gave a positive evaluation of each Director’s individual performance.
Areas for improvement in the corporate governance practice were identified:
– Further improvement of communication with the market: better insight into the audience
and its expectations, consistent and prompt market announcements
– Further development of the ESG agenda
– Improvement of communication channels between Board members and senior management
– Launch of an online platform to streamline the organisation of Board meetings
– Boosting senior management’s motivation
– Expanding the role of Board members in developing MMK’s strategy and strengthening
supervision over its implementation
– Continuous monitoring of new corporate governance practices.
AWARDS AND ACHIEVEMENTS
At the 16th National Director of the Year Award for the 2021
corporate year, Victor Rashnikov was named among the 25 Best Board
Chairmen.
MMK’s corporate governance has been independently assessed
every year since 2003. On 16 February 2022, the Russian Institute of
Directors confirmed MMK’s rating at 7++ (defined as having a
‘developed corporate governance practice’) on the National Corporate
Governance Rating scale. This means that the Company follows a
significant number of recommendations of the Russian Corporate
Governance Code and sustainability standards. Company shareholders
are exposed to a very low risk of losses caused by poor corporate
governance and sustainability management.

MMK INTEGRATED ANNUAL REPORT
107
CORPORATE GOVERNANCE IMPROVEMENT PROGRAMME FOR 2024
The Corporate Governance Improvement Programme outlines the following areas focus areas:
Strategy
Promote closer cooperation between management and independent directors on strategic
matters, taking into account current challenges and changing conditions; introduce regular strategy
sessions for the Board of Directors to review overall strategy; consider the feasibility and
appropriateness of updating the HR policy and strategy, internal regulations on succession planning
for key MMK executives, and upskilling programmes for key MMK executives.
Risk management and internal control
Keep members of the Audit Committee informed about new industry risks or emerging risks in
MMK’s activities; update members of the Audit Committee on best practices in risk management,
internal controls, and internal audits in public industrial companies.
Composition and skills mix of the Board of Directors
Consider how strengthening the Board diversity and equal opportunities can support the
implementation of the Company’s business strategy, taking into account principles such as the right
mix of skills, balanced composition, diversity, individual approach, independence, and information
transparency, in line with the relevant provisions of the UK and Russian corporate governance codes,
as well as best corporate governance practice.
Meetings of the Board of Directors and its committees
Promote progress reporting to the Board by the committee chairpersons to provide an update
on committee activities; scale up the involvement of external experts to discuss certain matters at
committee meetings (where appropriate); introduce an electronic document management system
covering MMK’s governing bodies and MMK Group companies.
Remuneration system for the Board of Directors, executive bodies, and other key
executives
Consider determining the criteria for and the amount of the remuneration for MMK’s Board of
Directors in the Regulations on Remunerations and Compensation of Expenses of Members of the Board
of Directors, taking into account best practices, the Company’s needs, and the need to have right-
calibre directors on board.
Stakeholder engagement, ESG, information disclosure
Development and approval by the Board of Directors of a map of MMK's key stakeholders, their
expectations, communication channels and persons responsible for communication with them, as well
as a strategy for stakeholder relations (including the role of the Board of Directors and management)
and plans for its implementation (taking into account international ESG reporting standards);
Consideration of the possibility of changing information disclosure practices, taking into account
changes in the law and best corporate conduct practices.

MMK INTEGRATED ANNUAL REPORT
108
BOARD ENGAGEMENT IN 2021
Building a constructive dialogue with all our stakeholders is of critical importance to us. This enables us to communicate more effectively with stakeholders on our
social, economic and governance performance results and also identify what matters are most important to each stakeholder, where we can improve, and what we need to
disclose.
Event
Description
Purpose
Result
Capital markets
day
Building on our pioneering online engagement in 2020,
MMK hosted a successful CMD in December 2021 that
gave stakeholders direct access to the senior
leadership team, in line with our commitment to open
communication. This event, moderated by an MMK
Independent Director, combined a live, interactive
online broadcast with a face-to-face session featuring
the Chairman of the Board of Directors, CEO, and
Director of Strategy and Development. We invited
investment fund analysts and representatives to take
part in the studio session and other stakeholders joined
online
The CMD gives us the opportunity talk to
stakeholders about the results of the
implementation of the Company’s strategy as well
as giving participants the chance to air their views
and ask questions directly to the senior team. This
exercise provides us with useful feedback and helps
the Board in its decision making
This two-way communication helps us understand what our
investors want to hear about from us and provides them with
the information and insights they are looking for. As well as
answering questions during the session in real time, we also
provided written answers to other questions that were not
covered during the event. We also posted a feedback form on
the event website and all this input will help us understand
how our investors see the Company’s strategy and will feed
into how we keep them informed in the future.
Learn more: https://mmk.ru/en/investor/investor-day/
Site visits to
subsidiaries
In 2021, an independent member of the Board of
Directors and Chairman of the Committee for
Occupational Health, Industrial Safety and the
Environment, hosted visits to MMK’s mines in the
Kemerovo Region and to the iron ore deposit in
Magnitogorsk
Visits to production sites are both motivating and
valuable for employees, helping them understand
the Company’s strategy and objectives in the
context of their own work. It is also extremely
helpful for delegates to see up close the workings of
a particular production site and to hear directly
from those working there
Following the two-day visit, the delegates from MMK mine
convened a meeting of the Committee for Occupational
Health, Industrial Safety and the Environment to discuss the
outcomes of occupational health and safety measures in 2020
and 2021 and OHS performance improvements at the coal
asset
Site visit to MMK
In September 2021, MMK hosted a production site visit
for analysts and representatives of investment funds,
during which the guests met with CEO Pavel Shilyaev
and a senior manager. The participants visited the
plant’s key facilities: Hot-Rolling Mill 5000, Cold-Rolling
Mill 2000, Cold-Rolling Mill 1700, Sinter Plant No. 5, as
well as metalware production facilities
We are guided by the principles of openness and
transparency in communicating with the investment
community. The analyst and investor site visit to
the plant offered a deep dive into the Company’s
production process and helped build relationships
and facilitate communications
Visitors could see for themselves the scale of production and
the results of our investment programme, as well as get
answers to their questions from both plant managers and
MMK’s CEO. After the event, we received positive feedback
from the participants and identified the most relevant topics
for further communication
Learn more: https://mmk.ru/en/investor/production-visit/
Communication
with retail
investors
MMK’s senior managers and members of the Board of
Directors participate in online webinars and video
conferences for retail investors, organised by brokers.
In 2021, a member of the Board of Directors, took part
in conferences organised by leading brokers, where he
spoke about the Company’s production process and
performance, and about trends in the raw material and
steel markets
The recent massive increase in the number of retail
investors drives innovative communications. We are
working hard to give this audience access to the
senior leadership team, so we can understand
where retail investors’ interests lie and answer their
questions directly
Thanks to our open dialogue in which we share our insights
with retail investors, we have seen increased engagement
rates among this stakeholder group and growth in the
number of video conference views.
Learn more: https://mmk.ru/en/investor/for-private-
investors/

MMK INTEGRATED ANNUAL REPORT
109
Chief Power
Engineer
MMK GOVERNANCE STRUCTURE
CEOs of Group Companies
CEO
Management
MMK
Management
Level Companies
of the Group
Auditor
Annual General Meeting
Board of Directors
Nomination and
Remuneration Committee
Sustainable Development
working group
Head of the Department
of Affairs and Social
Development
Internal Audit
Department
Audit
Committee
Health, Safety and the
Environment
Committee
Strategic Planning
Committee
Director for Occupational
Health, Industrial Safety
and the Environment
Corporate
Secretary
Secretary to the
Board of Directors
Head of Financial
Resources
Human Resources
Director
Deputy CEO for
External
Communications
Head of Sustainable
Development
MMK
Executive
Bodies
Head of Domestic
Sales
Security Director
Director of Strategy
and Development
Commercial
Director
Director for
Economics
Functional Areas and Divisions
of Group Companies
MMK
Collegial
Bodies
Commission
for Ethics
Commission for
Labor Disputes
Commission for
Labor Protection
Commission for Accounts Payable
and Accounts Receivable
Commission for the Preservation
of Property and Combating Corporate Fraud
Commission for
Anti-terrorism
Commission
for Overheads
Chief Information
Technology
Specialist
Director of Capital
Construction
Deputy CEO for
Production
Organisational link
Functional link
Chief Legal
Officer

MMK INTEGRATED ANNUAL REPORT
110
Overview of MMK’s corporate governance model and practice
MMK’s corporate governance structure is aligned with global best practice and comprises the
following bodies:
– Annual General Meeting;
– Board of Directors;
– Management Board (collective executive body);
– CEO (sole executive body).
ANNUAL GENERAL MEETING
The Annual General Meeting is the Company’s supreme governing body. By voting at Annual
General Meetings, the shareholders exercise their right to participate in managing the Company,
including the election of members of the Board of Directors, approval of the Auditor, approval of the
Annual Report and financial statements of the Company, profit distribution, including payment of
dividends, etc.
The AGM competence, as well as the procedure for convening and holding the Annual General
Meeting, are established by Russian laws, the Charter and Regulations on the Annual General Meeting
of MMK.
The Company’s internal documents on the procedure for holding the Annual General Meeting
outline, among other things, the following options:
– Sending voting ballots by e-mail to respective shareholders provided in the register of MMK
shareholders and/or providing an online voting form on the website as part of the notice of an upcoming
Annual General Meeting
– Submitting filled voting ballots by persons entitled to participate in the Annual General Meeting
by e-mail (shareholder@mmk.ru) as provided in the notice of an upcoming Annual General Meeting
and/or filling in the online voting form on the website provided in the notice of an upcoming Annual
General Meeting
– Filling in the online voting form on the website during an Annual General Meeting (at an in-
person meeting to discuss agenda items and decide on voting matters) in cases where the right to
participate in the meeting was not exercised otherwise earlier.
These options have been available free of charge since 2017 through the online service provided
by MMK’s registrar STATUS. Each investor has their own Shareholder Page, which is a secure
multifunctional information service. It includes a mobile app and provides services to shareholders
online and enables them to take part in the Company’s corporate activities such as e-voting at Annual
General Meetings.
The Company also uses the email address shareholder@mmk.ru to communicate with
shareholders, including correspondence relating to the AGM.
Once it is able to hold the Annual General Meeting in person again, the Company plans to start
streaming the meetings.
The notice of an upcoming Annual General Meeting and respective information (materials) to
be provided to persons entitled to participate in the Annual General Meeting are disclosed in Russian
and English on the Company’s website in the time and the manner specified by the Charter and
Regulations on the Annual General Meeting of MMK, at least 30 days before the date of the Annual
General Meeting.
The shareholders that hold a total of at least 2% of voting shares have the right to propose new
agenda items to be discussed at the Annual General Meeting and their nominees to the Board of
Directors (up to the number of Board members) and the sole executive body (CEO) (clauses 10.11-
10.14 of the Charter, clause 3 of the Regulations on the Annual General Meeting of MMK).
MMK shareholders that are not on the shareholder register also have the right to propose
agenda items and nominees by submitting such proposals to the person who registers their
shareholding rights, in accordance with Russian securities laws. In addition to mandatory information
and materials specified by Russian laws, the Company provides additional information and materials
on agenda items to be discussed at the Annual General Meeting in line with the Corporate Governance

MMK INTEGRATED ANNUAL REPORT
111
Code recommended by the Bank of Russia, including directions on how to reach the venue of the
meeting.
The Company’s independent registrar functions as the counting commission of the Annual
General Meeting.
The voting results and decisions taken by the Annual General Meeting are disclosed in line with
Russian law on the Company’s website.
In 2021, three Annual General Meetings were held:
On 28 May 2021, the Annual General Meeting reviewed the following agenda items:
1. Approval of the Annual Report and annual accounting (financial) statements of PJSC MMK for
2020
2. Profit distribution, including payment (declaration) of FY 2020 dividend
3. Election to PJSC MMK’s Board of Directors
4. Approval of PJSC MMK’s auditor
5. Approval of the amount of remuneration and compensation paid to members of PJSC MMK’s
Board of Directors
6. Payment of Q1 2021 dividend on outstanding shares. The quorum at the meeting was 86.98%
of the total number of votes of MMK outstanding ordinary shares.
On 10 September 2021, an Extraordinary General Meeting was held with the following agenda:
1. Payment of 1H 2021 dividends on outstanding shares
The quorum at the meeting was 87.06% of the total number of votes of MMK outstanding
ordinary shares.
On 24 December 2021, an Extraordinary General Meeting was held with the following agenda:
1. Payment of 9M 2021 dividends on outstanding shares
The quorum at the meeting was 85.13% of the total number of votes of MMK outstanding
ordinary shares.
Quorum of Annual General Meetings of MMK, %
MMK’S BOARD OF DIRECTORS
The Board of Directors is responsible for the overall supervision of the Company’s operations,
excluding matters reserved, by law, for the Annual General Meeting.
The Board of Directors is responsible for approving and updating the Company’s corporate
goals, statement of purpose, strategy, policies, key principles of, and approaches to, risk management
90.67
91.25
90.23
89.80
90.38
90.47
90.82
86.98
87.06
85.13
25-02-2019
31-05-2019
27-09-2019
27-12-2019
29-05-2020
11-09-2020
21-12-2020
28-05-2021
10-09-2021
24-12-2021

MMK INTEGRATED ANNUAL REPORT
112
and internal controls, sustainability management, and overseeing the Company’s executive bodies,
and performs other key functions.
The Board of Directors is accountable to the Company’s shareholders and is elected by
resolution of the Annual General Meeting (by cumulative voting).
The Board’s activities are regulated by the Charter and internal documents of MMK available on
the Company’s website.
Directors have sufficient time to perform their duties, which they acknowledge in a written
statement of nominees accepting to stand for election to the Company’s Board of Directors.
Board meetings are held on a regular basis, at least once every two months, in accordance with
the approved plan.
The most important matters referred to the remit of the Board of Directors are addressed at in-
person meetings (via videoconferencing under COVID-19 restrictions) and are usually reviewed in
advance by the Board committees to facilitate comprehensive discussion and informed decision-
making.
Information about the composition of the Board of Directors and its committees, as well as
about the meetings held and resolutions passed is disclosed on the Company’s website.
The Board Chair oversees the Board’s activities, ensures effective work of the Board and its
committees. His other functions include:
– Convening meetings of the Board of Directors, arranging for timely and proper notification of
Board members of convening a Board meeting;
– Ensuring preparation of an agenda of the Board meeting and taking all steps necessary to
ensure timely provision to directors of information (materials) required to pass resolutions on agenda
items;
– Chairs Board meetings, ensures compliance with the procedure for convening and holding
Board meetings;
– Ensures that the Board arrives at the most efficient resolutions on agenda items;
– Enables directors to express their point of view on matters under review, ensures a
constructive and friendly atmosphere at Board meetings, facilitates the search for a resolution agreed
by Board members in the interests of shareholders;
– Arranges for the keeping of minutes of meetings, signs them, and is responsible for their
correctness and timeliness;
– Chairs shareholder meetings;
– Follows up on resolutions of the Board of Directors and the Annual General Meeting;
– Interacts and keeps in touch with other bodies and employees of the Company in order to
obtain in a timely fashion the most complete and reliable information necessary for the Board of
Directors to pass resolutions and ensure effective interaction of the said bodies and employees of the
Company with each other and with third parties.
Composition of the Board of Directors
The Board of Directors consists of 10 members.
The composition of the Board is well balanced, including in terms of directors’ qualifications,
experience and diversity, as well as the number of independent directors.
Board members are elected based on required skills in line with the Company’s strategic
priorities, including its focus on sustainability. Requirements for nominees are considered and
determined when implementing succession procedures stipulated by the Regulations on the Board of
Directors of MMK.
In 2021, five Board members were recognised as independent, which complies with the
requirements of MMK’s Charter, the provisions of the UK Corporate Governance Code, the Corporate
Governance Code recommended by the Bank of Russia, and the Listing Rules of the Moscow Exchange.

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Members of the Board of Directors are considered to be independent if they are sufficiently
professional, experienced and capable of making fair and unbiased judgements, free of influence from
the Company’s executive bodies, individual groups of shareholders or other stakeholders.
Generally, a nominee or elected director who is related to the Company, to its significant
shareholder, significant counterparty or competitor, or to the government, may not be considered
independent. The independence criteria, including criteria on being related to the Company, its
significant shareholders, significant counterparty, competitors or government or municipal entities, are
determined in accordance with the Code of Corporate Governance recommended by the Bank of
Russia’s Letter No. 06-52/2463 dated 10 April 2014, and the Listing Rules of the Moscow Exchange.
Independent directors play an important role in ensuring efficient performance by the Board
of Directors, including protection of shareholder interests. The presence of independent directors on
the Board contributes to passing objective resolutions on matters under review, enhancing governance
effectiveness and shareholders’ and investors’ trust in the Company. Their qualifications, experience
and constructive criticism enable the Board of Directors to make more informed decisions on agenda
items.
Independent directors played a major role in updating the portfolio of strategic objectives up to
2025, developing KPIs and evaluating the performance of executive bodies, the external evaluation of
the performance of the Board of Directors (including for 2020), assessing risk management and
internal controls as well as the Company’s efforts to ensure industrial and environmental safety.
Independent directors also play an important role in the Board committees.
The Board of Directors, based on recommendations of the Nomination and Remuneration
Committee, assesses compliance of nominees to the Board of Directors with the independence criteria
and regularly reviews compliance of independent directors with these criteria.
In certain exceptional cases, the Board of Directors may recognise a director (nominee to the
Board of Directors) as independent (compliant with the independence criteria) despite any formal
criteria of being related to the Company, its significant shareholder, counterparty or competitor, the
government, or a municipal entity, if this relationship does not affect the person’s ability to make
independent, fair and unbiased judgements.
8
2
Gender balance of the Board
Male
Female
8
2
Foreign Board members
Russian citizens
Foreign citizens
4
6
Age
< 50
> 50
1
0
4
5
Tenure on the Board of
Directors
> 20 years
10-20 years
5-9 years
< 5 years
3
2
5
Composition of Board of
Directors
Executive
Non-executive
Independent

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Information on Board members’ compliance with the independence criteria is disclosed in the
Company’s Annual Report, as well as by posting the information on the Company’s website at
https://mmk.ru/en/
Board skills
Board members
Industry knowledge (metallurgy)
5
Strategy
6
Finance and investment
7
Risk management
7
Accounting and audit
7
HR management
6
Corporate governance
7
Information technologies
4
Labour protection, industrial safety
6
Sustainability
6
Activities of the Board
The Board of Directors’ procedures are set out in the Regulations on the Board of Directors of
MMK. Meetings of the Board of Directors are convened by the Board Chair and held both in person (by
video conference when appropriate) and in absentia.
Meetings of the Board of Directors (in person and in absentia)
From 1 January 2021 to 31 December 2021, 16 meetings of the Board of Directors were held –
seven in person (by video conference) and nine in absentia.
Matters reviewed by the Board of Directors in 2021
From 1 January 2021 to 31 December 2021 88 matters were reviewed.

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115
BOARD FOCUS IN 2021
In 2021, the Board of Directors discussed the following matters related to our strategy and the requirements of the Federal Law On Joint
Stock Companies, PJSC MMK’s Charter, the Corporate Governance Code of the Bank of Russia, and the UK Corporate Governance Code:
Overall supervision of the Board’s activities
Period under
review
Link to strategic
priority focus areas
Board leadership
and Company
purpose
- Progress on MMK’s strategic pillar – To Be the Best Supplier:
– Implementation of the Customer Focus strategic objective. Consideration of the key development
scenarios for the industry and sales markets in 2022
– Implementation of the Superior Product Portfolio strategic objective
Last year’s report
- A progress report on MMK’s Environmental Programme in 2021. The MMK Group’s Environmental
Policy in 2021
- Progress on MMK’s strategic pillar – To Be a Responsible, Sustainable Business (ESG):
– Implementation of the Continuous Improvement of Environmental Performance and Reduction in
CO2 Emissions strategic objective
– Implementation of the Zero Injuries strategic objective
– Implementation of the Corporate Culture of Opportunities strategic objective
- Progress on implementing MMK’s Digitalisation Projects
- The MMK Group’s key HR initiatives
Last year’s report
- Reports by MMK’s CEO on the strategic activities of MMK in the respective periods of 2020
- Approval of the 2020 Report of the Board of Directors on the Results of MMK’s Priority Activities
- Approval of MMK’s organisational structure
- Reviewing a claim of a member of MMK’s Management Board in line with Paragraph 1 of Article 83 of
the Federal Law on Joint Stock Companies
Last year’s report
- Progress on MMK’s strategic priorities – approval of fundamental elements of the MMK Group’s
Strategy 2025
- Approval of MMK’s Programme of Series 001Р Exchange-Traded Bond and MMK’s Prospectus
- Adoption of a decision on transactions in line with Clause 11.18.31 of MMK’s Charter
- Consent to, and subsequent approval of, interested-party transactions
Future plans
Division of
responsibilities
- Preliminary approval of MMK’s Annual Report 2020
Last year’s report
- Reviewing matters related to the convening of, and preparation for, MMK’s Annual General Meeting
and MMK’s Extraordinary General Meeting
- Establishment of the Management Board, the Company’s collective executive body
Future plans

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Composition,
succession and
evaluation
- Reviewing the results of an independent performance evaluation of MMK’s Board of Directors, Board
members and Board committees
Last year’s report
- Organising the activities of MMK’s Board of Directors, including matters related to the establishment
of the Board’s committees and approval of the Activity Plan of MMK’s Board of Directors for 2021 –
2022
- Approval of MMK’s Corporate Governance Improvement Programme to 2024
- Decision to conduct performance self-evaluation of MMK’s Board of Directors, Board members and
Board committees
- Recognition of a Board member as independent
- Reviewing requirements for nominees to MMK’s Board of Directors and assessment criteria
Future plans
Audit, risk and
internal control
- Implementation of MMK’s dividend policy
- Reviewing the effectiveness of MMK’s integrated risk management system and internal control system
in 2020
- Reviewing the internal audit report on the reliability and effectiveness of MMK’s risk management and
internal control system in 2020
- A report on MMK’s focus area – Cybersecurity
Last year’s report
- Approval of the MMK Group’s risk appetite statement
- Financial and business results of MMK and the MMK Group for the relevant reporting periods, and
approval of MMK’s and the MMK Group’s financial and business plan (budget) for FY 2022
- Audit-related matters: determining the amount of the auditor’s remuneration and preparing
recommendations to MMK’s Annual General Meeting on the proposed auditor
Future plans
Remuneration
- A report on achievement of Company-wide KPIs in 2020
Last year’s report
- Discussion of a forecast for KPI achievement in 2021 Approval of Company-wide KPIs for 2022
- Preparing recommendation for the Annual General Meeting regarding the remuneration and
reimbursement payable to members of PJSC MMK’s Board of Directors
Future plans

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MMK EXECUTIVE BODIES
MMK has two executive bodies: the Management Board is the collective executive body, and
the CEO is the sole executive body.
They are governed by the Regulations on the Collective Executive Body: the Management
Board, and the Regulations on the Sole Executive Body: the CEO of MMK.
The executive bodies regularly report at meetings of the Board of Directors on their activities
as per the plan approved by the Board of Directors.
The remit of the Company’s governing bodies is set out in the Charter of MMK.
MMK Management Board
MMK’s Management Board manages the Company’s day-to-day operations within its remit as
specified in MMK’s Charter and the Regulations approved by the Annual General Meeting.
The Management Board reports to the Board of Directors and Annual General Meeting and is
responsible for:
– Reviewing the financial and economic plans (budgets) of the MMK Group, the MMK Group
companies and non-profit organisations (private institutions) for the next financial year; forecasting
the MMK Group’s economic indicators;
– Analysing the implementation of the financial and economic plans (budgets) of the MMK
Group, the MMK Group companies and non-profit organisations (private institutions) and the
achievement of the MMK Group’s economic targets;
– Reviewing interim (monthly, quarterly, bi-annual) and annual reporting on operational,
economic, financial and business performance of the MMK Group and non-profit organisations (private
institutions) by the CEOs of the Group companies and organisations;
– Passing resolutions on MMK changing shareholding, acquiring or disposing of shares in other
organisations (except for those specified in Article 48, Paragraph 1.18 of the Russian Federal Law On
Joint Stock Companies);
– Approving MMK representatives at the Group companies and the companies beyond the MMK
Group in which MMK holds shares, based on the recommendation of the CEO;
– Approving directives to MMK representatives at the Group companies, the companies beyond
the MMK Group in which MMK holds shares and MMK’s private institutions in relation to passing
resolutions by respective general shareholders’ meetings and boards of directors on approving charters
(amendments and addenda to charters), setting up and eliminating governing bodies, reorganisation,
liquidation, changing shareholding or disposing of shares in other organisations, approving
transactions in line with Article 79 of the Law and Article 45 of Federal Law of the Russian Federation
On Limited Liability Companies, except for transactions with MMK;
– Approving activity plans of MMK’s Management Board.
In 2021, the Management Board held 34 meetings and reviewed the following matters:
– Analysis of the MMK Group’s financial and business performance;
– Key targets of the MMK Group’s financial and economic plan (budget);
– Reporting by the MMK Group companies on their operational, economic, financial and business
performance;
– Business processes across the MMK Group by business area;
– Implementation of strategic initiatives;
– Changing the shareholding and disposing of shares in other organisations;
– Approving directives to MMK representatives at the Group companies;
– Approving MMK representatives at the Group companies and directives to MMK
representatives at the Group companies;
– Approving the activity plan of MMK’s Management Board.

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CEO
The Company’s CEO acts on behalf of MMK and represents its interests in accordance with the
relevant Charter and Regulations.
The CEO manages MMK’s day-to-day operations and regularly reports to the Board of Directors
in accordance with the approved schedule of meetings.
The CEO is elected (appointed) by the Annual General Meeting for four years and may be re-
elected (reappointed) an unlimited number of times.
MMK Corporate Secretary
The Corporate Secretary ensures efficient ongoing interaction with shareholders, coordinates
MMK’s efforts to protect shareholder rights and interests, and supports the efficient performance of
the Annual General Meeting, Board of Directors and its committees.
The Corporate Secretary is appointed on an annual basis and can be removed by the CEO based
on the decision of the Board of Directors.
The Corporate Secretary’s functions, rights and duties are outlined in the Regulations on the
Corporate Secretary of MMK approved by the Board of Directors.
The Corporate Secretary is guided by Russian laws, MMK’s Charter, internal documents,
Resolutions of the Annual General Meeting and the Board of Directors.
Victor Sedov has been the Corporate Secretary of MMK since 2021.
Name
Victor Sedov
Experience
Mr Sedov joined the MMK Legal Department in 1997
Qualifications
Degree in Electrical engineering from Magnitogorsk Institute of Mining and
Metallurgy.
Degree in Law from Ural Academy of Public Administration.
MSc in Private Laws from Russian School of Private Law.
THE BOARD COMMITTEES
The Board of Directors has four committees:
– Strategic Planning Committee - reviews matters of strategic planning, corporate governance,
finance and economics, as well as MMK’s credit and dividend policies.
– Health, Safety and Environment Committee - reviews HSE matters.
– Audit Committee - reviews the Board of Directors’ ability to manage the Company’s financial
and economic activities, including assessing the independence of the auditor and the absence of
conflicts of interest, as well as assessing the audit of financial reporting and the reliability and
effectiveness of the risk management and internal control systems.
– Nomination and Remuneration Committee - reviews matters related to MMK’s priorities for its
HR policy, succession planning, the professional competence of nominees to the Board of Directors,
executive bodies and other key executives, as well as remuneration of members of the Company’s
governing bodies and other key executives.
The Board committees were set up to improve the Board’s performance, review critical matters
within its competence and prepare respective recommendations. The committees are governed by the
Regulations on Committees of the Board of Directors of MMK (were approved by the MMK Board of
Directors on 24 December 2020).
The committees submit performance reports to the Board of Directors no later than 30 business
days prior to the date of the Annual General Meeting.
The current composition of the committees is aligned with the Russian and UK Corporate
Governance Codes, Listing Rules of the Moscow Exchange and MMK’s internal documents.

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COMMITTEE FOR STRATEGIC PLANNING
The Strategic Planning Committee is ideally placed to take a holistic view of the business. It
has the perspective to ensure that the leadership team keeps each of our strategic objectives in view
and continues to pursue them consistently and diligently.
Committee functions
The Committee for Strategic Planning of MMK’s Board of Directors conducts an initial review
and prepares recommendations on matters within the Board’s remit related to strategic planning,
sustainable development, corporate governance, innovation, economics, finance, and MMK’s credit and
dividend policies.
The CEO, business line directors, unit heads, and the Corporate Secretary take part in the
Committee meetings.
Key activities in 2021
Budgeting and financing
The CEO reported to the Committee each quarter on the performance of PJSC MMK and the
Group. The Committee reviewed the financial and business performance of PJSC MMK and the MMK
Group in 2020, taking into account the impact of the pandemic on the Group’s results, and the forecast
and analysis of the Group’s financial and business performance for the reporting periods of 2021.
The Committee conducted an initial review of the financial and business plan (budget) of PJSC
MMK and the MMK Group for FY 2022, outlining the Company’s development objectives and priorities
for 2022, and considering potentially challenging scenarios.
Strategic management
In line with PJSC MMK’s priorities for 2021, the Committee reviewed the progress on its strategic
initiatives as follows: Best supplier for the Most Demanding Customers in the Automotive Industry in
the Domestic Market, Lean Manufacturing, Procurement, Customer Focus, Value Creation, Customer
Focus, and Superior Product Portfolio. The Committee prepared recommendations to the Board of
Directors on the key areas of investor relations, sales, procurement, cybersecurity, and digital projects.
Throughout the year, the Committee maintained its focus on sustainability, which is its highest
priority area. In July 2021, the Committee held a strategy session on sustainable development (ESG)
attended by members of other committees of MMK’s Board of Directors, reviewing PJSC MMK’s priority
goals, areas of focus, and progress on sustainability.
Corporate governance
In line with the Committee’s functions, it conducted an initial review of matters related to
convening and holding the Annual General Meeting and made recommendations to the Board of
Directors on the following:
– Preliminary approval of the Annual Report and annual accounting (financial) statements of
MMK for 2020
– Approval of the Report of the Board of Directors on the Results of PJSC MMK’s Priority Activities
in 2020 and the pillars of the MMK Group’s Development Strategy 2025
– Approval of the distribution of profit for FY 2020
The Committee recommended including the draft Report on PJSC MMK’s Compliance with the
Principles and Recommendations of the Corporate Governance Code for 2020 in the Annual Report.
In line with best corporate governance practice, the Committee holds meetings to discuss key
changes in regulation and development of corporate governance practice in Russia and globally.

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HEALTH, SAFETY AND ENVIRONMENT COMMITTEE
The health and safety of our people and the planet requires us to be bold and ambitious, and
the work of the HSE Committee takes its responsibility to support MMK to do so with the utmost
seriousness.
Committee functions
The Health, Safety and the Environment Committee of MMK’s Board of Directors reviews and
prepares recommendations on matters within the Board’s remit related to health, safety and
environmental (HSE) matters.
The Committee meetings are attended by business line directors and directors of the MMK Group
companies, unit heads, and MMK’s Corporate Secretary.
Key activities in 2021
Occupational health and safety
In the reporting year, the Committee reviewed PJSC MMK’s 2020 performance in occupational
health and safety, including work-related injury rates, measures to identify and prevent hazardous
activities, preventive measures to reduce the COVID-19 incidence rate, and progress on occupational
health and safety initiatives against the schedule.
In December 2021, the Committee reviewed progress on the strategic initiative to achieve zero
injuries by 2025, comprising measures to promote a safety culture among Group and contractor
employees, develop automated safety systems, and implement a programme of technical initiatives to
reduce the risk of incidents and accidents.
In April 2021, the Chairman of the Committee, held on-site meetings, followed by a Committee
meeting at Kemerovo Region about implementing occupational health and safety measures in 2020–
2021 and improving occupational health and safety at MMK mine.
Environment
The key focus of the Company’s environmental agenda is to reduce emissions from its industrial
facilities. In 2021, the Company approved the strategic initiative of Continuous Improvement of
Environmental Performance and Reduction in CO
2
Emissions as part of its priority goal To Be a
Responsible, Sustainable Business (ESG).
PJSC MMK sets ambitious goals to reduce CO
2
emissions, requiring the Committee to explore
the potential of the best available steelmaking technologies that enable emission reduction,
decarbonisation of metallurgical operations, and transition to carbon neutrality.
In December, the Committee reviewed green finance initiatives and prospects for attracting
such financing. The Committee conducts a quarterly monitoring assessment of MMK’s key
environmental performance metrics. In the reporting period, it reviewed progress on PJSC MMK’s
environmental safety activities against the 2021–2022 schedule, including implementation of measures
to reduce emissions from production facilities, to preserve and enhance biodiversity in the Chelyabinsk
Region, and to automate carbon emission calculation, as well as activities under MMK’s Environmental
Programme for 2022.

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AUDIT COMMITTEE
MMK's Audit Committee is responsible for ensuring that the Company has the right team in
place to manage its financial and economic activities in the best way possible.
Committee functions
The Audit Committee of MMK’s Board of Directors reviews and prepares recommendations on
financial and economic matters within the Board’s remit, including assessing the independence of
MMK’s auditor and the absence of conflicts of interest, as well as assessing the audit of financial
reporting and the reliability and effectiveness of the risk management and internal control systems.
The external auditor, Head of the Internal Audit Department, business line directors, and MMK’s
Corporate Secretary take an active part in the Committee meetings.
Key activities in 2021
External audit and financial reporting
Throughout the year, the Committee worked closely with the external auditor, JSC
PricewaterhouseCoopers Audit, to review the audit plan for the Company’s financial (accounting)
statements (RAS and IFRS) for 2021, and the auditor’s reports and draft reports on the audit of MMK’s
IFRS consolidated financial statements for the reporting periods. Key audit matters were discussed,
specifically, asset impairment and the potential impact of COVID-19 on the Group, including the current
and future impact on its financial performance. In line with corporate governance best practice, the
statements are submitted for review by the Audit Committee before they are signed and published.
At the meeting of the Audit Committee held in March 2021, the auditor’s report by JSC
PricewaterhouseCoopers Audit on the audit of MMK’s accounting (financial) statements (RAS and IFRS)
for 2020 was reviewed, and the Committee prepared a quality assessment of the accounting (financial)
statements audit.
Internal audit
The Committee reviewed performance reports of MMK’s Internal Audit Department on a
quarterly basis.
Risk management and internal control
Recommendations were prepared for the Board of Directors following the 2020 performance
review of MMK’s integrated risk management system and internal control system, with proposals
approved to improve the effectiveness of the risk management system and the internal control system
based on their maturity level and assessment of compliance with the Bank of Russia’s
recommendations (Information Letter No. IN-06-28/143 dated 1 October 2020).
As part of reviewing risk materialisation monitoring and MMK Group’s risk map for 2021, a
recommendation was made to revise and approve the MMK Group’s risk appetite statement. The Group
uses risk appetite to drive the achievement of its strategic and operational goals by keeping risks
within acceptable limits.
The Committee reviewed the Internal Audit Department’s report on the reliability and
performance of MMK’s risk management and internal control system in 2020 and prepared a
recommendation to include it in the information (materials) to be provided to persons entitled to
participate in MMK’s Annual General Meeting in line with Paragraph 3 of Article 52 of the Federal Law
on Joint Stock Companies.
The 2021–2022 roadmap for integrating the new Code of Ethics in the MMK Group’s corporate
culture was approved. The Code of Ethics, developed and approved in 2020, defines the Group’s core
values and ethical principles governing employee relations both within the team and with customers,
business partners, investors, and government agencies.

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Internal Audit Department
MMK has established an Internal Audit Department to provide informed, independent and
objective assurances and advice designed to add value and improve performance. The Head of the
Internal Audit Department reports to the Audit Committee of MMK’s Board of Directors and has an
administrative reporting line to the CEO, which ensures sufficient independence to perform internal
audit functions. Internal audit helps MMK achieve its goals by bringing a systematic, disciplined
approach that evaluates and improves the effectiveness of risk management, control and corporate
governance processes.
The Internal Audit Department’s main functions are to:
– Perform independent and objective assessments of the reliability and effectiveness of MMK’s
internal control system in line with the risk-based approach
– Develop recommendations to eliminate gaps identified during audits and oversee their
implementation
– Advise MMK’s management on the establishment and functioning of the internal control
system.
The effectiveness of the internal control system is assessed based on continuous monitoring of
efficient and reasonable use of resources, asset integrity and compliance with laws and MMK’s internal
regulations, as well as the results of measures taken to eliminate violations and gaps and improve the
internal control system.
Audits of the risk management system’s effectiveness cover:
– The completeness and correctness of risk identification and assessment by MMK’s
management (across all management levels)
– Effectiveness of control procedures and other risk management measures
– Analysis of information about materialised risks.
The Head of the Internal Audit Department takes part in Audit
Committee meetings on a quarterly basis to inform the Committee on:
– the proposed annual activity plan of the Internal Audit Department, which takes into account
prioritised risk-focused key business processes and controls, as well as the macroeconomic
environment and available resources
– the progress on the plan (including information on significant risks, violations/gaps, results
and the status of implementation of the Internal Audit Department’s recommendations and proposals)
and challenges faced by the Department
– the assessment of the adequacy and maturity of elements of MMK’s internal control and risk
management systems for effective risk management.
The Internal Audit Department is guided by:
– International Standards for the Professional Practice of Internal Auditing
– the Code of Ethics for internal auditors
– MMK’s internal documents on internal audit.
Auditor
At present, the auditor of MMK's individual and consolidated statements is
PricewaterhouseCoopers Audit. PricewaterhouseCoopers Audit was selected on a competitive basis and
meets the requirements of Russian law set for auditing companies in terms of independence and
absence conflict of interest. The company has developed a list of procedures to comply with the

MMK INTEGRATED ANNUAL REPORT
123
requirements for independence and absence of conflict of interest. Membership in a self-regulating
organisation of auditors additionally guarantees compliance with the independence requirements.
The audit by this company is conducted beginning with the 2015 accounts. In 2020,
PricewaterhouseCoopers Audit rotated the audit partner, which is in line with professional standards
and best corporate governance practices.
The amount of the auditor's remuneration you can find in the materials for the Annual General
Meeting of Shareholders by clicking on the following links:
https://mmk.ru/en/about/corporate-governance/shareholders-meeting/documents/
https://mmk.ru/upload/iblock/20b/9yl89u2faqu92q3wahb4p9se31l13cxx/EXPLANATORY%20N
OTE%204.pdf
NOMINATIONS AND REMUNERATION COMMITTEE
The role of the Nominations and Remuneration Committee is to make sure we have the right
people in the right roles and ensure they are fairly rewarded for their contribution
Committee functions
The Committee for Nominations and Remuneration of MMK’s Board of Directors reviews and
prepares recommendations on matters within the Board’s remit related to MMK’s priorities for its HR
policy, succession planning, the professional competence of nominees to the Board of Directors,
executive bodies and other key executives, as well as remuneration of members of MMK’s governing
bodies and other key executives.
The Director for Human Resources, Corporate Secretary, business line directors and unit heads
take an active part in the Committee meetings.
Key activities in 2021
HR policy, succession planning, the professional skills of nominees to key positions
In 2021, the Committee selected a competent external consultant and approved the
methodology and approaches to conduct an independent performance evaluation of MMK’s Board of
Directors, Board members, and Board committees. Following this evaluation, the Committee discussed
in detail the report on the results of the performance evaluation of MMK’s Board of Directors, Board
members, and Board committees. As part of the evaluation, the Committee participated in an
interactive training session devoted to current Russian and international corporate governance
practices.
The Committee reviewed the report on the implementation of the Corporate Culture of
Opportunities strategic initiative and the key focus areas of the MMK Group’s HR policy in 2020, and
made a recommendation to approve the key focus areas of the MMK Group’s HR policy for 2021.
The Committee conducted an initial review of shareholder proposals regarding nominees to
MMK’s Board of Directors and, upon the Board’s instruction, made recommendations on additional
nominees to be included in the list of nominees to MMK’s Board of Directors.
The Committee also prepared recommendations to the Board of Directors to support decision
making relating to the approval of MMK’s organisational structure. Given the need to change the size
and composition of MMK’s Management Board, as well as the distribution of functional roles between
the Management Board members, the Committee considered the staffing procedure for the Company’s
collective executive body MMK’s Management Board.
The Committee proposed that a self-evaluation process be used to perform the 2021
performance evaluation of MMK’s Board of Directors, Board members, and Board committees.
To strengthen the Company’s Board of Directors and boost its performance, the Committee
reviewed matters related to succession planning and professional skills of nominees to the Board of

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Directors, and defined the requirements for nominees to MMK’s Board of Directors and their evaluation
criteria.
Building an effective remuneration system for all key executives
The Committee presented written proposals to the Annual General Meeting regarding the
remuneration and compensation payable to members of MMK’s Board of Directors.
The Committee also conducted an initial review and evaluated the achievement of key
performance indicators in 2020 and it discussed potential corporate KPIs to be included in 2022,
including those relating to the Company’s Sustainability metrics. The Committee reviewed the
projected progress against corporate KPIs in 2021, making a recommendation to approve corporate
KPIs for 2022.
Remuneration of MMK's Board Members and the Management Board
Remuneration of Board members
The level of remuneration payable to Board members is approved by the Company's Annual
General Meeting based on recommendations of the Board of Directors. In this respect the Company
is guided by the need to maintain a sufficient motivation to retain high-skilled experts, as well as by
the interests of shareholders and other stakeholders.
All remunerations are paid in accordance with the Regulations on Remuneration and
Compensation of Expenses of Members of the Board of Directors of MMK. The Regulations govern the
amount, conditions and procedure for making payments. In the reporting period, the Company's Board
was comprised of three categories of directors: executive directors, non-executive directors and
independent directors. Only independent and non-executive directors are remunerated for their service
on the Board of Directors. The amount of the annual remuneration is fixed and determined by the
contracts with the independent and non-executive members of the Board of Directors, and reflects the
expected time and required efforts of the director for preparation for and participation in the Board
meetings.
The annual remuneration is paid to the members of the Board of Directors on a monthly basis,
in non-cash form, for the period during which they perform their duties. Documented expenses are
compensated additionally. Reimbursable expenses of the members of the Board of Directors include:
- Travelling expenses to meeting venues and back;
- Accommodation for the duration of meetings;
- Communication and postal services.
The Company’s Annual General Meeting, held on May 28, 2021, approved the amount of
remuneration and compensation to members of the Board of Directors in the total amount of RUB 120
million ($1.6 million). The actual amount of remuneration and compensation to members of the Board
of Directors of MMK for 2021 was $910,200.
Types of payments to the Board of Directors in 2021, $’000
Type of payment
2019
2020
2021
Annual remuneration for service on governing
bodies
945.5
872.7
906.4
Reimbursement of expenses
24.9
15.4
3.8
Remuneration of Management Board Members
No separate remuneration is paid to the members of MMK's Management Board during their
term of office, nor does the Company provide reimbursement of expenses for performing the duties of
members of the Management Board. Members of the Management Board are paid salaries for the
performance of official duties at MMK, which consists of fixed and variable parts. The variable part is
based on the Company’s performance and personal contribution to this performance by members of

MMK INTEGRATED ANNUAL REPORT
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the Management Board. Members of the Management Board own shares in MMK, which contributes to
the convergence of interests and increases the involvement of top management in achieving results.
In 2021, the fixed salary of Management Board members for the performance of their official
duties at MMK totaled $3,173,400.
Payments to the Management Board members in 2021, $'000
Type of payment
2019
2020
2021
Salary (fixed)
3,705.6
3,079.6
3,173.4
Annual bonus
33.1%
28.9%
52.4%
The remuneration of MMK's CEO includes a monthly salary and an annual bonus. Its amount
reflects the CEO's qualifications and takes into account the contribution he made to the Company's
financial results. The CEO is entitled to a bonus, which is paid at the end of the year in accordance
with the decision of the Nomination and Remuneration Committee of the Board of Directors and the
Board of Directors. According to the current KPI system, the CEO's bonus depends on the achievement
of performance results. Actual performance is assessed based on comparison with the previous
financial year.
The KPI structure for members of the Management Board is designed with due regard to
individual responsibility and performance. The CEO's KPIs include financial and production results of
the Company, operating efficiency, social responsibility, occupational safety and achieving zero fatal
injuries. For these indicators a system of calculating the annual bonus for the Company's CEO and
other members of the Management Board was developed.
The level of remuneration paid to top management by the Company is deemed sufficient to
attract, motivate and retain competent and skilled professionals and ensures that they exercise their
rights and duties in good faith in the best interests of MMK.
REPORT OF MMK’S BOARD OF DIRECTORS
Corporate Governance
For a description of the Group’s corporate governance structure and standards, see pages
100-126 of this Integrated Annual Report.
Financial and accounting statements
The Board believes that the information disclosed on page 3, 7-8, 10, 21-22, 140-199 of this
Integrated Annual Report is sufficient for shareholders to evaluate the Company’s performance,
business model and strategy.
Board election and succession policy
In accordance with the Federal Law On Joint Stock Companies, members of the Board of
Directors are elected annually by the Annual General Meeting and may be re-elected an unlimited
number of times. Only individuals may be members of the Company’s Board of Directors.
In accordance with applicable Russian laws and the Company’s internal documents, PJSC MMK
takes measures to ensure the succession of Board members, to propose nominees to the Board of
Directors whose personal and professional qualities and reputation should not raise doubts that they
will act in the interests of the Company and its shareholders, and ensure that proposed nominees to
the Company’s Board of Directors meet the independence criteria.

MMK INTEGRATED ANNUAL REPORT
126
Based on recommendations of the Nomination and Remuneration Committee, the Company’s
Board of Directors conducts an annual:
– analysis of the current composition of PJSC MMK’s Board of Directors and the skill sets
required to successfully implement PJSC MMK’s strategy, address internal and external challenges
faced by PJSC MMK, and ensure smooth succession of PJSC MMK’s Board members
– assessment of compliance of nominees to the Board of Directors and review of compliance
of independent directors with the independence criteria. Information on the Board members’
compliance with the independence criteria is disclosed in the Annual Report (see pages 111-112), as
well as by posting the relevant information on the Company’s website.
In line with the Corporate Governance Code, to improve the validity and efficiency of decision
making regarding the election of the Company’s Board members, the Board of Directors prepares
recommendations (based on recommendations of the Committee for Nominations and Remuneration)
regarding voting on this agenda item at the Annual General Meeting and ensures that this information
is communicated to the Company shareholders.
Disclosure of information that may affect the performance of the duties of a member
of a governing body
Board members (as well as Management Board members) shall notify the Company in
accordance with applicable Russian laws:
– of the occurrence of circumstances that may cause a Board member to be recognised as an
interested party in the Company’s transaction by completing a Notification as per the template
approved by the Bank of Russia
– of any other circumstances that may influence the performance of their duties as Board
members (as well as Management Board members) by completing the Questionnaire for members of
PJSC MMK’s governing bodies
– of the occurrence of circumstances that cause a Board member to cease to be independent.
Information on a Board member ceasing to be independent is disclosed by posting the relevant
information on the Company’s website at http://mmk.ru/en.
Directors’ indemnity guarantees
The Company, at its own expense, insures Board members’ liability under obligations resulting
from losses incurred by the Company through actions (omissions) of Board members during the
exercise of their rights and performance of their duties.
Matters within the remit of the Board of Directors and roles of the Board committees
Matters within the remit of the Board of Directors are set forth in the Charter of PJSC MMK.
The roles of the Board committees are set forth in the Regulations on the PJSC MMK Board of
Directors’ Committees.
Matters within the remit of the Board of Directors and committees’ roles are updated following
changes in legislation and as necessary.
Share capital structure
Information on PJSC MMK’s share capital structure is available on page 127 of the Integrated
Annual Report, as well as on the Company’s website.
No special restrictions are placed on the size of a shareholding or the transfer of shares other
than those stipulated by Russian laws.
The Board of Directors is not aware of any agreements between shareholders that may result
in restrictions on the transfer of shares or voting rights.
As at 31 December 2021, MMK Group companies did not hold any treasury shares.

MMK INTEGRATED ANNUAL REPORT
127
Dividends
In 2021, PJSC MMK posted a net profit of RUB 220.95 billion. Taking into account retained
earnings of RUB 208.58 billion as of 31 December 2020 and MMK’s 2021 financial result, and
considering Q1 2021 dividend payout of RUB 20,057.9 million (RUB 1.795 (including tax) per share),
1H 2021 dividend payout of RUB 39,445.4 million (RUB 3.530 (including tax) per share), and 9M 2021
dividend payout of RUB 29,757.2 million (RUB 2.663 (including tax) per share), the Board of Directors
recommended to the Annual General Meeting a FY2021 dividend of RUB 3.550 (including tax) per
share.
The distribution of PJSC MMK’s 2021 profit recommended by the Board of Directors is in line
with the Company’s dividend policy
Annual General Meeting
The Annual General Meeting will take place on 30 June 2022. Having taken into account all
aspects considered by the Board of Directors during the year, the Board of Directors tentatively
approved PJSC MMK’s 2021 Integrated Annual Report.
MMK Board of Directors
25 April 2022

MMK INTEGRATED ANNUAL REPORT
128
INFORMATION FOR INVESTORS
HEAD OF IR
VERONIKA KRYACHKO
«
We are committed to maintaining a proactive and open
dialogue with all investors. We will continue to improve our work
with investors and market analysts, develop relationships and
ensure the high quality of our reporting.
»
Changes in equity during the year
MMK’s authorised capital comprises 11,174,330,000 ordinary registered shares with a par value
of RUB 1 each. All shares are outstanding.
As at 29 November 2021 (record date for the 24 December 2021 Extraordinary Annual General
Meeting), the Company had 386,349 shareholders.
Geographical distribution of MMK shareholders in 2021
48
Public offerings
MMK made two share offerings in 2021:
– In April, Mintha Holding Limited, with the ultimate beneficial owner Victor Rashnikov, sold
335 million ordinary shares in MMK, or 3% of MMK’s authorised capital, through an accelerated
bookbuild offering;
– In September, Mintha Holding Limited sold 168 million ordinary shares in MMK, or 1.5% of
MMK’s authorised capital, through another accelerated bookbuild.
Share capital structure
49
Name
Stake in the authorised capital, %
Mintha Holding Limited
50
79.76
Citibank, N.A.
51
2.04
Others
18.20
MMK’s management is not aware of any shareholders holding over 5% of the Company shares
other than those disclosed above.
48
As a % of free float, excluding retail investors as of 31.12.2021.
49
As of 29 November 2021.
50
Victor Rashnikov, Chairman of MMK’s Board of Directors, is the beneficiary of Mintha Holding Limited.
51
Beneficiaries are holders of global depositary receipts traded on the London Stock Exchange.
26%
26%
20%
11%
4%
7%
8%
USA
Russia
UK
Sweden
Netherlands
Other Europe
Rest of World

MMK INTEGRATED ANNUAL REPORT
129
Report on the dividend policy on MMK shares
MMK’s Board of Directors approved the current Regulations on the Dividend Policy of MMK on
13 November 2019 (Minutes No.8).
MMK’s dividend policy is based on the balance between shareholder interests and the Company’s
requirements for further growth and technological upgrades.
In making recommendations on the dividend amount, the Board of Directors is guided by the
following principles:
- Dividend payment will be not less than 100% of free cash flow if the Net Debt to EBITDA
ratio < 1;
- Dividend payment will be not less than 50% of free cash flow if the Net Debt to EBITDA
ratio > 1.
MMK declares dividends on an annual basis, and the Company aims to pay out dividends on a
quarterly basis (for Q1, 1H and 9M of the reporting year) provided that its current financial position is
stable.
In making recommendations on the dividend amount, the Board of Directors may also use other
metrics in addition to free cash flow calculated based on MMK’s IFRS consolidated financial statements.
Such indicators may include net profit as reported in MMK’s IFRS consolidated financial statements or
net profit as reported in MMK’s financial statements prepared in accordance with Russian Accounting
Standards.
In 2021, by resolutions of the MMK Annual General Meeting, dividends were declared for
FY2020, 1Q, 1H and 9M 2021:
Reporting period
FY2020
1Q 2021
1H 2021
9M 2021
Recommendations
of MMK’s Board of
Directors to MMK’s
Annual General
Meeting on the
amount of dividend
payments
On 29 January 2021,
MMK’s Board of
Directors
recommended to
approve a dividend
of RUB 0.945 per
share
On 20 April 2021,
MMK’s Board of
Directors
recommended to
approve a dividend
of RUB 1.795 per
share
On 21 July 2021,
MMK’s Board of
Directors
recommended to
approve a dividend
of RUB 3.530 per
share
On 25 October
2021, MMK’s Board
of Directors
recommended to
approve a dividend
of RUB 2.663 per
share
Result of the vote to
approve the
dividend
On 28 May 2021, the
Annual General
Meeting approved
the dividend
recommended by
MMK’s Board of
Directors
On 28 May 2021,
the Annual General
Meeting approved
the dividend
recommended by
MMK’s Board of
Directors
On 10 September
2021, the
Extraordinary
General Meeting
approved the
dividend
recommended by
MMK’s Board of
Directors
On 24 December
2021, the
Extraordinary
General Meeting
approved the
dividend
recommended by
MMK’s Board of
Directors
Date of payment of
dividends to
nominee holders and
trustees
1 July 2021
1 July 2021
11 October 2021
27 January 2022
Date of payment of
dividends to other
shareholders of
record
22 July 2021
22 July 2021
1 November 2021
17 February 2022

MMK INTEGRATED ANNUAL REPORT
130
MMK’s five-year dividend history
Year for which dividend was
declared
Dividend amount
per share, RUB
Dividends accrued, millions
2017
(for 1H, 9M and FY)
2.786
31,132
RUB
520
USD
2018
(for Q1, 1H, 9M and FY)
5.902
65,951
RUB
1,007
USD
2019
(for Q1, 1H, 9M and FY)
5.335
59,615
RUB
911
USD
2020
(for 1H,9M and FY)
3.943
44,060
RUB
591
USD
2021
(for Q1, 1H, 9M)
7.988
89,261
RUB
1,218
USD
MMK’s shares and global depositary receipts (GDRs)
As of 31 December 2020, MMK’s ordinary shares and GDRs were traded on the Moscow
Exchange (MOEX) and the London Stock Exchange (LSE), respectively.
Global Depositary Receipts (GDRs) are issued in respect of ordinary shares at a ratio of 13
registered ordinary shares per one GDR. The GDRs are traded on the London Stock Exchange.
Securities traded on the stock exchanges (LSE, Moscow Exchange) are fungible, so that ordinary
shares may be converted into GDRs and vice versa.
The Company’s depositary bank is Citibank N.A.
As of 31 December 2021, GDRs represented approximately 2.04% of MMK’s share capital.
Stock exchange where MMK shares and GDRs are traded
Stock exchange
Issuer code
MOEX
MAGN
LSE
MMK
Identification numbers for MMK securities
CUSIP
52
MICEX
Regulation S GDR
Rule 144A GDR
X5171A103
559189204
559189105
ISIN
53
MICEX
Regulation S GDR
Rule 144A GDR
RU0009084396
US5591892048
US5591891057
52
CUSIP (Committee on Uniform Security Identification Procedures) is an identification number assigned to shares and used to
facilitate clearing and settlement of trades.
53
ISIN (International Securities Identification Number) is an international share identification code.

MMK INTEGRATED ANNUAL REPORT
131
Share prices and trading volumes on the London Stock Exchange in 2021
Source: LSE, Bloomberg
Share prices and trading volumes on the Moscow Exchange in 2021
SourceMOEX, Bloomberg
MMK ordinary shares and GDRs: Summary
Indicator
Moscow Exchange
(RUB/share)
London Stock Exchange
($/GDR)
2020
2021
2020
2021
Yearly high
59.09
79.78
10.40
14.16
Yearly low
31.225
49.14
5.07
8.58
Year-end price
55.815
69.65
9.75
12.10
Trading volume (million shares)
5 501
11 238
26
20
0
1
2
3
4
5
6
$ $ million
Jan
Apr
May
Sep
Dec
Feb Mar
Jun
Jul
Aug Oct
Nov
Trading volume, $ million
GDR price, $/GDR
13.00
7.00
5.00
11.00
9.00
0
2,000
4,000
6,000
8,000
10,000
12,000
RUB RUB million
80.00
50.00
40.00
70.00
60.00
30.00
Jan
Apr
May
Sep
Dec
Feb
Mar
Jun
Jul
Aug
Oct
Nov
Trading volume, RUB million
Share price, RUB/share
12,000
6,000
4,000
10,000
8,000
2,000

MMK INTEGRATED ANNUAL REPORT
132
MMK’s credit ratings
54
The Company has credit ratings from each of the three major ratings agencies: Fitch Ratings,
Moody’s, S&P Global Ratings.
MMK maintained investment-grade credit ratings in 2020, with S&P Global Ratings upgrading
its outlook on the Company. In April 2021, Fitch Ratings affirmed MMK’s long-term credit rating at
BBB with a stable outlook.
Rating agency
Fitch
Moody's
S&P
Credit rating
BBB
Baa2
BBB–
Outlook
Stable
Stable
Stable
Last rating action
03.04.2020
12.02.2019
20.11.2020
MMK’s index membership
Index names
Index codes
Weight, %
Moscow Exchange indices
55
Moscow Exchange Index and RTS Index
IMOEX, RTSI
0.69
Metals and Mining Index
MOEXMM, RTSmm
5.33
Broad Market Index
MICEXBMI, RUBMI
0.62
MOEX 10 Index
MOEX10
10.51
Responsibility and Transparency Index Constituents
MRRT
1.04
Sustainability Vector Index Constituents
MRSV
4.44
FTSE indices
56
FTSE Russia IOB Index
57
RIOB
0.17
FTSE Emerging Index
AWALLENR
0.03
FTSE Russia RIC Capped Index
FTRUSPR1
1.34
Analytical coverage
Analysts from leading Russian and international banks, including Bank of America, Citibank,
Goldman Sachs, JPMorgan Chase & Co., Sberbank CIB and VTB Capital, provide regular coverage of
MMK. For more details, see MMK’s website https://mmk.ru/en/investor/analitics/
Information on the Company’s Registrar
Registrar Company STATUS (indefinite licence No.10-000-1-00304 issued by the Russian
Federal Financial Markets Service on 12 March 2004) is responsible for maintaining MMK’s shareholder
register.
The Registrar’s registered office is located at Ring Park Business Centre, 23 Novokhokhlovskaya
St., Bld. 1, Moscow, 109052, Russian Federation.
Tel.: +7 495 280 0487
E-mail: office@rostatus.ru
Magnitogorsk Branch of STATUS:
212 Karla Marksa Avenue, 455008, Magnitogorsk, Russian Federation
Tel.: +7 3519 25 6022/25 6023
54
As of 31.12.2021.
55
As of 31.12.2021.
56
As of Q3 2021.
57
MMK’s GDR in the index.

MMK INTEGRATED ANNUAL REPORT
133
Investor relations
One of MMK’s top priorities is to ensure there is an open line of communication to its investors
and shareholders, with the Company’s management maintaining a dialogue with the investment
community by:
- attending and participating in international conferences and forums online and offline
- holding presentations, conference calls, and webcasts to review the market situation and
discuss the Company’s results for the period
- holding regular face-to-face and online meetings with investors and analysts
- arranging for site visits to production facilities
- holding the Investor Day.
In 2021, MMK participated in a total of 17 conferences and five non-deal roadshows (NDRs).
We held 236 meetings and calls with investors, with 59% of the events attended by top management.
Communication with retail investors
In 2021, MMK continued its efforts to ramp up communication with retail investors to improve
the investor perception of the Company and foster a dialogue with potential and existing retail
investors.
Outcomes of MMK’s social media activities:
- Livestream on social media with a stock market expert blogger: over 50,000 views
- Live audio stream on Telegram with our top management: over 4,000 listens
- Livestream with top management on Smart Lab, a dedicated portal for private investors: over
6,000 views
- Launch of MMK’s blog on Tinkoff’s Pulse
In 2021, we continued hosting meetings with the top management and IR teams and held
livestreams with major brokerages for private investors: over 9,000 views.
Investor Day
On 7 December 2021, the Company held its Investor Day in a hybrid format, attended by the
Chairman of the Board of Directors, the CEO and the Director of Strategy and Development. It was
broadcast on the dedicated MMK Online website and on MMK’s social media accounts both in Russian
and English. The international investment community gave a highly positive response to the event.
The stream recording is available at the event website.
A production site visit
MMK was one of three issuers organising a production site visit in 2021. Hosted for 15 people
(10 analysts and five investors), most of them visiting MMK for the first time, the two-day programme
included visits to:
- Sinter Plant #5, Blast Furnace #2, and the coke and by-product plant
- MMK’s digitised facilities (a data centre, central control room, and hazardous areas, where we
hosted an employee tracking system demonstration)
- Hot-Rolling Mills 2500 and 5000, Cold-Rolling Mills 1700 and 2000, and Continuous Hot-Dip
Galvanising Line #3 (Rolling Shop #11)
- metalware production facilities
The visit also included a round table with the heads of all our business units.
Board Oversight
The Board receives investor relations information covering key investor meetings and activities,
shareholder and investor feedback. Analyst reports and the current consensus forecast are also
circulated on a continuing basis by IR team.
In 2020 the Company conducted a perception study among the investment community
regarding satisfaction with the long-term development strategy of the Company, corporate governance
quality, information disclosure in the area of sustainable development and other key issues. Based on

MMK INTEGRATED ANNUAL REPORT
134
the results of this survey, in January 2021 the Company's Board of Directors reviewed the investor
relations priorities for 2021. In January 2022, the Board of Directors analysed the results of investor
relations in the priority areas and found them satisfactory.
Information Disclosure
MMK ensures that any material information is communicated to all interested parties at the
same time.
Information is disclosed primarily through the following channels:
London Stock Exchange website: the Company publishes information that could potentially
affect the price of its GDRs/shares.
NSM (National Storage Mechanism) is the national storage mechanism in the UK. The
Company publishes information in accordance with the UK legislation in connection with the circulation
of depositary receipts issued for the Company's ordinary shares on the London Stock Exchange.
Interfax is an information disclosure server. The Company publishes information in accordance
with the legislation (Law on the Securities Market and Law on Joint Stock Companies).
The Magnitogorsk Metal newspaper. In accordance with its Charter, the Company informs
about its activities through the mass media - the Magnitogorsk Metal newspaper and the TV-IN
television channel.
MMK’s website: MMK regularly publishes updates on its activities and press releases about
important corporate events as well as financial and operating results. In 2021, the website design was
refreshed, and the Investors section was improved. The Company also publishes its Annual Report on
its website every year. For more details, see Investors’ page on MMK’s website.
E-mail: the Company keeps investors up to date on its activities by sending out:
- press releases on important corporate events and financial and operating results
- metals and raw materials market overviews by the Company’s strategy and IR teams
You can contact our Investor Relations team by e-mail at ir@mmk.ru.
Telegram channel: MMK’s official channel on Telegram provides timely and accurate
information on its IR and PR activities (reviews of financial and operating results, summaries of
conference calls with top management, announcements of upcoming events and conferences for
investors, videos, official comments, etc.) https://tlgg.ru/MMK_Official
Blogs on dedicated platforms: the Company has blogs on the Smart-Lab website and on the
Tinkoff’s Pulse portal to provide retail investors with timely and accurate information on the Company’s
IR and PR efforts. We also publish educational content about metallurgy on these websites to improve
knowledge among professional market participants and educate new players.
Social media
MMK also uses social media as an additional channel of information disclosure. Company and
industry news and publications in the Russian and foreign media can be found on our official pages on:
- LinkedIn
- Tinkoff Pulse

MMK INTEGRATED ANNUAL REPORT
135
Awards and achievements
Communicate magazine, a UK publication covering corporate financial
communication practices, held its annual Corporate & Financial Awards
ceremony in 2021. MMK won the Best Management of Investor & Analyst
Relations category, recognising the high quality of its Integrated Annual
Report 2020, and the Best Management of Investor & Analyst Relations
during the COVID Pandemic category.
MMK was second in the best retail investor relations programme category
at the 11th International IR/ESG Cases Contest held by the Financial
Communications & Investor Relations Alliance (ARFI) non-profit
partnership.
MMK ranked third in the Best Disclosure of Information on Sustainability
category of the Moscow Exchange’s 24th Annual Report Contest. In 2020,
MMK included its sustainability report into the Integrated Annual Report
for the first time and used SASB standards in preparing non-financial
disclosures: another first for the Company.
MMK’s IR team ranked fourth in the Emerging EMEA Executive Team 2021
list, having received high scores from the respondents of the Executive
Team 2021 survey conducted by Institutional Investor, where some 2,000
investors and securities market analysts evaluated companies’ openness
and reliability in shareholder relations, as well as their financial policies,
capital management, and the overall performance of IR departments.
MMK’s Investor Day – MMK Online in 2020 topped the Best Investor Event
category among small and mid-cap companies at the international IR
Magazine Awards.

MMK INTEGRATED ANNUAL REPORT
136
RESPONSIBILITY STATEMENT
MMK’s management confirms that, to the best of its knowledge:
The financial statements prepared in accordance with International Financial Reporting
Standards give a true and fair view of the assets, liabilities, financial position and profit or loss of MMK
and the undertakings included in the consolidation taken as a whole.
The management report includes a fair review of the development and performance of the
business and the position of MMK and the undertakings included in the consolidation taken as a whole,
together with a description of the principal risks and uncertainties that they face.
In preparing this Report, MMK was guided by International Integrated Reporting Framework
(<IR>, 2021), GRI and SASB standards, as well as by recommendations for businesses on integrating
SDGs into their reporting.
___________________________
Pavel Shilyaev
CEO of MMK

MMK INTEGRATED ANNUAL REPORT
137
COMPLIANCE OF THE REPORT WITH THE INTERNATIONAL INTEGRATED REPORTING
FRAMEWORK
<IR> Fundamental Concepts reflection in the Report
Fundamental Concepts
Used / Not used
Value creation for the organization and for
others
Used
The capitals
Used
Process through which value is created,
preserved or eroded
Used
<IR> Fundamental Principles reflection in the Report
Fundamental Principles
Compliant / Not compliant
Strategic focus and future orientation
Compliant
Connectivity of information
Compliant
Stakeholder relationships
Compliant
Materiality
Compliant
Conciseness
Compliant
Reliability and completeness
Compliant
Consistency and comparability
Compliant
<IR> Content Elements reflection in the Report
Content Elements
Section of the Report
Page
Organizational overview and
external environment
At a glance
Market trends
7-8
27-28
Governance
Governance
100-126
Business model
Business model
10
Risks and opportunities
Market trends
Risk management
27-28
91-99
Strategy and resource
allocation
Strategy
Financial capital: Capital allocation
21-22
35-37
Performance
Strategy
Key performance indicators
Financial capital
Manufactured capital
21-22
23-26
34-41
42-55
Outlook
Strategy
Market trends
21-22
27-28
Basis of preparation and
presentation
About this Report
3-6

MMK INTEGRATED ANNUAL REPORT
138
BSI VERIFICATION OPINION

MMK INTEGRATED ANNUAL REPORT
139
CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER
2021
STATEMENT OF MANAGEMENT’S RESPONSIBILITIES FOR THE PREPARATION
AND APPROVAL OF THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER
2021
INDEPENDENT AUDITORS’ REPORT
CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER
2021:
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME .................................................... 148
CONSOLIDATED STATEMENT OF FINANCIAL POSITION ........................................................... 149
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ............................................................ 150
CONSOLIDATED STATEMENT OF CASH FLOWS ...................................................................... 151
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. GENERAL INFORMATION .......................................................................................... 153
2. ADOPTION OF NEW OR REVISED STANDARDS AND INTERPRETATIONS ......................... 153
3. BASIS OF PREPARATION .......................................................................................... 154
4. SIGNIFICANT ACCOUNTING POLICIES ....................................................................... 155
5. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY
171
6. REVENUE ............................................................................................................... 174
7. SEGMENT INFORMATION .......................................................................................... 174
8. COST OF SALES ...................................................................................................... 176
9. GENERAL AND ADMINISTRATIVE EXPENSES ............................................................... 176
10. SELLING AND DISTRIBUTION EXPENSES .................................................................... 176
11. OTHER OPERATING INCOME/(EXPENSE), NET ............................................................ 177
12. OTHER EXPENSES ................................................................................................... 177
13. FINANCE COSTS ..................................................................................................... 177
14. FOREIGN EXCHANGE GAIN/(LOSS), NET .................................................................... 177
15. INCOME TAXES ....................................................................................................... 177
16. PROPERTY, PLANT AND EQUIPMENT .......................................................................... 180
17. INVENTORIES ......................................................................................................... 183
18. TRADE AND OTHER RECEIVABLES ............................................................................. 183
19. INVESTMENTS IN SECURITIES AND OTHER FINANCIAL ASSETS .................................... 185
20. CASH AND CASH EQUIVALENTS ................................................................................ 185
21. SHARE CAPITAL ...................................................................................................... 186
22. LONG-TERM BORROWINGS ...................................................................................... 186
23. SITE RESTORATION PROVISION ............................................................................... 188
24. DEFINED CONTRIBUTION PLANS ............................................................................... 189
25. TRADE AND OTHER PAYABLES .................................................................................. 189
26. SHORT-TERM BORROWINGS AND CURRENT PORTION OF LONG-TERM BORROWINGS ..... 190
27. RELATED PARTIES ................................................................................................... 190
28. RISK MANAGEMENT ACTIVITIES ............................................................................... 191
29. CAPITAL MANAGEMENT ............................................................................................ 195
30. COMMITMENTS AND CONTINGENCIES ....................................................................... 195
31. FAIR VALUE OF FINANCIAL INSTRUMENTS ................................................................. 198
32. EVENTS AFTER THE DATE OF CONSOLIDATED STATEMENT OF FINANCIAL POSITION ...... 199
33. APPROVAL OF THE CONSOLIDATED FINANCIAL STATEMENTS ....................................... 199

MMK INTEGRATED ANNUAL REPORT
140
STATEMENT OF MANAGEMENT’S RESPONSIBILITIES FOR THE PREPARATION AND
APPROVAL OF THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021
Management is responsible for the preparation of consolidated financial statements that present fairly
the financial position of Public Joint Stock Company Magnitogorsk Iron & Steel Works and its
subsidiaries (the "Group") at 31 December
2021, and the results of its operations, cash flows and changes in equity for the year then ended, in
compliance with International Financial Reporting Standards ("IFRS").
In preparing the consolidated financial statements, management is responsible for:
 properly selecting and applying accounting policies;
 presenting information, including accounting policies, in a manner that provides relevant,
reliable, comparable and understandable information;
 providing additional disclosures when compliance with the specific requirements in IFRS are
insufficient to enable users to understand the impact of particular transactions, other events and
conditions on the Group's financial position and financial performance; and
 making an assessment of the Group's ability to continue as a going concern.
Management is also responsible for:
 designing, implementing and maintaining an effective and sound system of internal controls
throughout the Group;
 maintaining adequate accounting records that are sufficient to show and explain the Group's
transactions and disclose with reasonable accuracy at any time the financial position of the Group,
and which enable them to ensure that the consolidated financial statements of the Group comply
with IFRS;
 maintaining statutory accounting records in compliance with statutory legislation and accounting
standards;
 taking such steps as are reasonably available to them to safeguard the assets of the Group; and
 preventing and detecting fraud and other irregularities.
The consolidated financial statements for the year ended 31 December 2021 were approved for
issuance on 28 February 2022 by:
____________________________ ____________________________
P. V. Shilyaev O. Y. Samoylova
General Director Director of OOO MMK-ACCOUNTING CENTER,
a specialized organization, which performs the
accounting function for Public Joint Stock
Company Magnitogorsk Iron & Steel Works
28 February 2022
Magnitogorsk, Russia

MMK INTEGRATED ANNUAL REPORT
141

MMK INTEGRATED ANNUAL REPORT
142

MMK INTEGRATED ANNUAL REPORT
143

MMK INTEGRATED ANNUAL REPORT
144

MMK INTEGRATED ANNUAL REPORT
145

MMK INTEGRATED ANNUAL REPORT
146

MMK INTEGRATED ANNUAL REPORT
147
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
Year ended 31 December
Notes
2021
2020
REVENUE
6
11,869
6,395
COST OF SALES
8
(7,028)
(4,691)
GROSS PROFIT
4,841
1,704
General and administrative expenses
9
(223)
(205)
Selling and distribution expenses
10
(877)
(492)
Change in expected credit loss, net
18
-
(2)
Other operating income/(expense), net
11
12
(63)
OPERATING PROFIT
3,753
942
Finance income
28
23
Finance costs
13
(37)
(44)
Foreign exchange gain/(loss), net
14
31
(129)
Impairment and provision for site restoration
16, 23
265
66
Other expense
(55)
(68)
PROFIT BEFORE INCOME TAX
3,985
790
INCOME TAX
15
(864)
(186)
PROFIT FOR THE YEAR
3,121
604
OTHER COMPREHENSIVE LOSS
Items, that may be reclassified subsequently to profit or loss
Translation of foreign operations
(17)
261
Items, that will not be reclassified subsequently to profit or loss
Remeasurements of post-employment benefit obligations
2
-
Effect of translation to presentation currency
(16)
(1,101)
OTHER COMPREHENSIVE LOSS FOR THE YEAR, NET OF TAX
(31)
(840)
TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR
3,090
(236)
Profit attributable to:
Shareholders of the Parent Company
3,118
603
Non-controlling interest
3
1
3,121
604
Total comprehensive income/(loss) attributable to:
Shareholders of the Parent Company
3,087
(234)
Non-controlling interests
3
(2)
3,090
(236)
BASIC AND DILUTED EARNINGS PER SHARE (U.S. Dollars)
0.279
0.054
Weighted average number of ordinary shares outstanding
(in thousands)
11,174,330
11,174,330
The notes on pages 153 to 199 are an integral part of these consolidated financial statements.

MMK INTEGRATED ANNUAL REPORT
148
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AT 31 DECEMBER 2021
(In millions of U.S. Dollars)
31 December
Notes
2021
2020
ASSETS
NON-CURRENT ASSETS:
Property, plant and equipment
16
5,358
4,541
Right-of-use assets
10
8
Intangible assets
38
40
Investments in securities and other financial assets
19
6
2
Investments in associates
1
1
Deferred tax assets
15
65
49
Total non-current assets
5,478
4,641
CURRENT ASSETS:
Inventories
17
1,606
1,128
Trade and other receivables
18
1,191
606
Investments in securities and other financial assets
19
528
207
Income tax receivable
20
5
Value added tax recoverable
49
47
Cash and cash equivalents
20
843
858
Total current assets
4,237
2,851
TOTAL ASSETS
9,715
7,492
EQUITY AND LIABILITIES
EQUITY:
Share capital
21
386
386
Share premium
969
969
Translation reserve
(6,328)
(6,295)
Retained earnings
11,281
9,522
Equity attributable to shareholders of the Parent Company
6,308
4,582
Non-controlling interest
22
19
Total equity
6,330
4,601
NON-CURRENT LIABILITIES:
Long-term borrowings
22
528
548
Obligations under leases
7
8
Retirement benefit obligations
16
18
Long-term other payables
-
2
Site restoration provision
23
96
125
Deferred tax liabilities
15
455
365
Total non-current liabilities
1,102
1,066
CURRENT LIABILITIES:
Short-term borrowings and current portion of long-term
borrowings
26
433
411
Current portion of obligations under leases
3
3
Current portion of retirement benefit obligations
1
2
Trade and other payables
25
1,770
1,380
Current portion of site restoration provision
23
12
11
Income tax payables
64
18
Total current liabilities
2,283
1,825
TOTAL EQUITY AND LIABILITIES
9,715
7,492
____________________________ ____________________________
P. V. Shilyaev O. Y. Samoylova
General Director Director of OOO MMK-ACCOUNTING CENTER,
a specialized organization, which performs the
accounting function for Public Joint Stock
Company Magnitogorsk Iron & Steel Works
28 February 2022
Magnitogorsk, Russia
The notes on pages 153 to 199 are an integral part of these consolidated financial statements.

MMK INTEGRATED ANNUAL REPORT
149
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars)
Attributable to shareholders of the Parent Company
Notes
Share
capital
Share
premium
Translation
reserve
Retained
earnings
Total
Non-contr
olling
interest
Total
equity
BALANCE AT 1 JANUARY 2020
386
969
(5,458)
9,600
5,497
22
5,519
Profit for the year
-
-
-
603
603
1
604
Other comprehensive loss for the year, net of tax
-
-
(837)
-
(837)
(3)
(840)
Total comprehensive loss for the year
-
-
(837)
603
(234)
(2)
(236)
Decrease in non-controlling interests due to changes of the
Group’s share in subsidiaries
-
-
-
1
1
(1)
-
Dividends
21
-
-
-
(682)
(682)
-
(682)
BALANCE AT 31 DECEMBER 2020
386
969
(6,295)
9,522
4,582
19
4,601
Profit for the year
-
-
-
3,118
3,118
3
3,121
Other comprehensive loss for the year, net of tax
-
-
(33)
2
(31)
-
(31)
Total comprehensive income for the year
-
-
(33)
3,120
3,087
3
3,090
Dividends
21
-
-
-
(1,361)
(1,361)
-
(1,361)
BALANCE AT 31 DECEMBER
2021
386
969
(6,328)
11,281
6,308
22
6,330
The notes on pages 153 to 199 are an integral part of these consolidated financial statements.

MMK INTEGRATED ANNUAL REPORT
150
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars)
Year ended 31 December
Notes
2021
2020
OPERATING ACTIVITIES:
Profit for the year
3,121
604
Adjustments to profit for the period:
Income tax
864
186
Depreciation and amortization
10, 8, 9
509
484
Impairment and provision for site restoration
16, 23
(265)
(66)
Finance costs
13
37
44
Loss on disposal of property, plant and equipment
11
28
66
Change in expected credit loss
18
-
2
Change in allowance for advances issued
11
2
-
Change in provision for legal claims
11
2
17
Change in allowance for obsolete and slow-moving
inventory
17
(1)
(4)
Finance income
(28)
(23)
Foreign exchange (gain)/loss, net
14
(31)
129
(Gain)/loss on disposal of subsidiaries
11
(3)
3
Operating cashflow before working capital changes
4,235
1,442
Movements in working capital
Increase in trade and other receivables
(597)
(113)
Increase in value added tax recoverable
(14)
(1)
Increase in inventories
(468)
(52)
Increase in trade and other payables
322
132
Cash generated from operations
3,478
1,408
Interest paid
(25)
(26)
Income tax paid
(738)
(156)
Net cash from operating activities
2,715
1,226
INVESTING ACTIVITIES:
Purchase of property, plant and equipment
(1,119)
(683)
Purchase of intangible assets
(13)
(11)
Proceeds from sale of property, plant and equipment
2
2
Interest received
28
23
Proceeds from sale of subsidiaries, net of disposed cash
-
1
Proceeds from sale of securities and other financial assets
3
3
Purchase of securities and other financial assets
(4)
(3)
Placement of short-term bank deposits
(1,040)
(620)
Withdrawal of short-term bank deposits
720
420
Net cash used in investing activities
(1,423)
(868)
The notes on pages 153 to 199 are an integral part of these consolidated financial statements.

MMK INTEGRATED ANNUAL REPORT
151
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2021 (CONTINUED)
(In millions of U.S. Dollars)
Year ended 31 December
Notes
2021
2020
FINANCING ACTIVITIES:
Proceeds from borrowings
505
705
Repayments of borrowings
(475)
(636)
Repayment of the principal amount of the lease obligation
(5)
(4)
Dividends paid to equity holders of the Parent Company
(1,321)
(623)
Net cash used in financing activities
(1,296)
(558)
NET DECREASE IN CASH AND CASH EQUIVALENTS
(4)
(200)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
20
858
1,105
Effect of translation to presentation currency and exchange
rate changes on the balance of cash held in foreign currencies
(11)
(47)
CASH AND CASH EQUIVALENTS, END OF PERIOD
20
843
858
The notes on pages 153 to 199 are an integral part of these consolidated financial statements.

MMK INTEGRATED ANNUAL REPORT
152
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
1. General information
PJSC Magnitogorsk Iron & Steel Works ("the Parent Company") is a public joint stock company as
defined by the Civil Code of the Russian Federation. The Parent Company was established as a state
owned enterprise in 1932. It was incorporated as an open joint stock company on 17 October 1992 as
part of and in accordance with the Russian Federation privatisation program.
The Parent Company, together with its subsidiaries (the "Group"), is a producer of ferrous metal
products. The Group’s products are sold in the Russian Federation and internationally. The subsidiaries
of the Parent Company are mainly involved in the various sub-processes within the production cycle
of ferrous metal products or in the distribution of those products. The Group is also engaged in coal
mining and sale thereof.
The Parent Company’s registered office is 93, Kirova street, Magnitogorsk, Chelyabinsk region, Russia,
455000.
As at 31 December
2021 the Parent Company's major shareholder was Mintha Holding Limited with a 79.8% ownership
interest (31 December
2020: 84.3%).
The ultimate beneficiary of the Parent Company is Mr. Viktor F. Rashnikov, the Chairman of its Board
of Directors.
At 31 December
2021 and 2020, the Group's principal subsidiaries were as follows:
Effective % held at
31 December
Subsidiary by country of
incorporation
Nature of business
2021
2020
Russian Federation
OJSC Metizno-Kalibrovochny Zavod
“MMK-Metiz”
Production of metal hardware products
95.78
95.78
LLC MMK LMZ
Production of ferrous metal products
100.00
100.00
LLC IK MMK Finance
Investing activities
100.00
100.00
LLC Ogneupor
Production of refractory materials
100.00
100.00
LLC Mekhanoremontny Komplex
Maintenance of metallurgical equipment
100.00
100.00
LLC OSK
Production of machinery and equipment
for metallurgy
100.00
100.00
LLC MTSOZ
Production of cement and refractory
materials
100.00
100.00
LLC MMK Vtormet
Collection and processing of metal scrap
100.00
100.00
LLC Torgovy Dom MMK
Trading activities
100.00
100.00
OJSC Belon
Holding company, trading activities
98.32
98.19
LLC MMK Ugol
Coal mining
99.46
99.42
Turkey
MMK Metalurji
Production of ferrous metal products
100.00
100.00
Switzerland
MMK Steel Trade AG
Trading activities
100.00
100.00
Luxemburg
ММК-Mining Assets Management S.A.
Holding company
100.00
100.00
2. Adoption of New or Revised Standards and Interpretations
The following amended standards became effective from 1 January 2021, but did not have any material
impact on the Group:
 Covid-19-Related Rent Concessions - Amendments to IFRS 16 (issued on 28 May 2020 and
effective for annual periods beginning on or after 1 June 2020);

MMK INTEGRATED ANNUAL REPORT
153
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
2. Adoption of New or Revised Standards and Interpretations (continued)
 Interest rate benchmark (IBOR) reform - phase 2 amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4
and IFRS 16 (issued on 27 August 2020 and effective for annual periods beginning on or after 1
January 2021). The Group has no financial instruments with interest rates linked to LIBOR and
other IBOR rates, for those amendments were already announced.
New Accounting Pronouncements
Certain new standards and interpretations have been issued that are mandatory for the annual periods
beginning on or after 1 January 2022 or later, and which the Group has not early adopted.
The following other new pronouncements are not expected to have any material impact on the Group
when adopted:
 Sale or Contribution of Assets between an Investor and its Associate or Joint
Venture - Amendments to IFRS 10 and IAS 28 (issued on 11 September 2014 and effective for
annual periods beginning on or after a date to be determined by the IASB);
 IFRS 17 "Insurance Contracts" (issued on 18 May 2017 and effective for annual periods beginning
on or after 1 January 2021 - the effective date subsequently modified to 1 January 2023 by the
Amendments to IFRS 17 as discussed below);
 Amendments to IFRS 17 and an amendment to IFRS 4 (issued on 25 June 2020 and effective for
annual periods beginning on or after 1 January 2023);
 Classification of liabilities as current or non-current – Amendments to IAS 1 (issued on 23 January
2020 and effective for annual periods beginning on or after 1 January 2022);
 Classification of liabilities as current or non-current, deferral of effective date – Amendments to
IAS 1 (issued on 15 July 2020 and effective for annual periods beginning on or after 1 January
2023);
 Proceeds before intended use, Onerous contracts – cost of fulfilling a contract, Reference to the
Conceptual Framework – narrow scope amendments to IAS 16, IAS 37 and IFRS 3, and Annual
Improvements to IFRSs 2018-2020 – amendments to IFRS 1, IFRS 9, IFRS 16 and IAS 41
(issued on 14 May 2020 and effective for annual periods beginning on or after 1 January 2022);
 Amendments to IAS 1 and IFRS Practice Statement 2: Disclosure of Accounting policies (issued
on 12 February 2021 and effective for annual periods beginning on or after 1 January 2023);
 Amendments to IAS 8: Definition of Accounting Estimates (issued on 12 February 2021 and
effective for annual periods beginning on or after 1 January 2023);
 Covid-19-Related Rent Concessions - Amendments to IFRS 16 (issued on 31 March 2021 and
effective or annual periods beginning on or after 1 April 2021). An amendment issued on 31
March 2021 extended the date of the practical expedient from 30 June 2021 to 30 June 2022;
 Deferred tax related to assets and liabilities arising from a single transaction - Amendments to
IAS 12 (issued on 7 May 2021 and effective for annual periods beginning on or after 1 January
2023).
3. Basis of preparation
Basis of preparation
International Financial Reporting Standards ("IFRS") include Standards and Interpretations issued by
the International Accounting Standards Board ("IASB").
These consolidated financial statements of the Group have been prepared in accordance with IFRS.

MMK INTEGRATED ANNUAL REPORT
154
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
3. Basis of preparation (continued)
The Group additionally prepares IFRS consolidated financial statements presented in Russian roubles
and in Russian language in accordance with the Federal Law No. 208 - FZ "On consolidated financial
reporting".
The consolidated financial statements of the Group are prepared under the historical cost convention,
as modified by the initial recognition of financial instruments based on fair value, derivative financial
instruments, which are accounted for at fair value, and other financial assets at FVTPL.
4. Significant Accounting Policies
The principal accounting policies applied in the preparation of these consolidated financial statements
are set out below. These policies have been consistently applied to all the periods presented, unless
otherwise stated.
Basis of consolidation
Subsidiaries
These consolidated financial statements incorporate the financial statements of the Parent Company
and its subsidiaries. Subsidiaries are those investees, including structured entities, that the Group
controls because the Group (i) has power to direct the relevant activities of the investees that
significantly affect their returns, (ii) has exposure, or rights, to variable returns from its involvement
with the investees, and (iii) has the ability to use its power over the investees to affect the amount of
the investor's returns. The existence and effect of substantive rights, including substantive potential
voting rights, are considered when assessing whether the Group has power over another entity. For a
right to be substantive, the holder must have a practical ability to exercise that right when decisions
about the direction of the relevant activities of the investee need to be made. The Group may have
power over an investee even when it holds less than the majority of the voting power in an investee.
In such a case, the Group assesses the size of its voting rights relative to the size and dispersion of
holdings of the other vote holders to determine if it has de-facto power over the investee. Protective
rights of other investors, such as those that relate to fundamental changes of the investee's activities
or apply only in exceptional circumstances, do not prevent the Group from controlling an investee.
Subsidiaries are consolidated from the date on which control is transferred to the Group (acquisition
date) and are deconsolidated from the date on which control ceases.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring their
accounting policies into line with those used by the Group.
Non-controlling interests in subsidiaries are identified separately from the Group's equity therein. The
interests of non-controlling shareholders may be initially measured either at fair value or at the
non-controlling interests' proportionate share of the acquiree's identifiable net assets. The choice of
measurement basis is made on an acquisition-by-acquisition basis. Subsequent to acquisition, the
carrying amount of non-controlling interests is the amount of those interests at initial recognition plus
the non-controlling interests' share of subsequent changes in equity. Total comprehensive income is
attributed to non-controlling interests even if this results in the non-controlling interests having a
deficit balance.
Changes in the Group's interests in subsidiaries that do not result in a loss of control are accounted for
as equity transactions. Any difference between the purchase consideration and the carrying amount of
non-controlling interest acquired is recorded as a capital transaction directly in equity. The Group
recognises the difference between sales consideration and the carrying amount of non-controlling
interest sold as a capital transaction in the consolidated statement of changes in equity.

MMK INTEGRATED ANNUAL REPORT
155
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
When the Group loses control of a subsidiary, the profit or loss on disposal is calculated as the
difference between (i) the aggregate of the fair value of the consideration received and the fair value
of any retained interest and (ii) the previous carrying amount of the assets (including goodwill), and
liabilities of the subsidiary and any non-controlling interests. Amounts previously recognised in other
comprehensive income in relation to the subsidiary are accounted for (i.e. reclassified to profit or loss
or transferred directly to retained earnings) in the same manner as would be required if the relevant
assets or liabilities were disposed of. The fair value of any investment retained in the former subsidiary
at the date when control is lost is regarded as the fair value on initial recognition for subsequent
accounting under IFRS 9 "Financial Instruments" or, when applicable, as the cost on initial recognition
of an investment in an associate or jointly controlled entity.
Functional and presentation currency
Different entities within the Group have different functional currencies, based on the underlying
economic conditions of their operations.
The functional currency of the Group's entities except for MMK Metalurji and MMK Steel Trade AG is
the Russian Rouble ("RUB"). The functional currency of MMK Metalurji and MMK Steel Trade AG is the
United States Dollar ("USD").
These consolidated financial statements are presented in millions of USD. Using USD as a presentation
currency is considered by management to be more relevant for users of the consolidated financial
statements of the Group.
The translation into presentation currency is made as follows:
 all assets and liabilities, both monetary and non-monetary, are translated at closing exchange
rates at the dates of each consolidated statement of financial position presented;
 all income and expenses in each consolidated statement of comprehensive income are translated
at exchange rates in effect when the transactions occur. For those transactions that occur evenly
over the year a monthly average exchange rate is applied;
 all items included in the consolidated shareholders' equity, other than total comprehensive
income, are translated at historical exchange rates; and
 in the consolidated statement of cash flows, cash balances at the beginning and end of each year
presented are translated at exchange rates at the respective dates of the beginning and end of
each year. All cash flows are translated at exchange rates in effect when the cash flows occur.
For those cash flows that occur evenly over the year an average exchange rate for the year is
applied.
On consolidation, exchange differences arising from the translation of any net investment in foreign
entities are recognised in other comprehensive income as "Effect of foreign operations". When a foreign
operation is sold, the associated exchange differences are reclassified to profit or loss, as part of the
gain or loss on sale.
Exchange rates used for translation into presentation currency of the consolidated financial statements
were as follows:
31 December
2021
2020
Russian Rouble/US Dollar
Year-end rates
74.29
73.88
Average for the period
73.62
72.40

MMK INTEGRATED ANNUAL REPORT
156
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
Foreign currency transactions
Transactions in currencies other than the functional currencies of the Group's entities (foreign
currencies) are recorded at the exchange rates at the dates of the transactions. At each statement of
financial position date monetary assets and liabilities denominated in foreign currencies are translated
at the exchange rates at the date of statement of financial position. Exchange differences arising from
changes in exchange rates are recognised in the consolidated statement of comprehensive income
within "Foreign exchange gain/(loss), net". Non-monetary items carried at historical cost are translated
at the exchange rate on the date of transaction. Non-monetary items measured at fair value in a
foreign currency, including equity investments, are translated at the exchange rate on the date on
which the most recent fair value was determined. Effects of exchange rate changes on non-monetary
items measured at fair value in a foreign currency are recorded as part of the fair value gain or loss.
Goodwill
Goodwill arising in a business combination is recognised as an asset at the date that control is acquired
(the acquisition date). Goodwill is measured as the excess of the sum of the consideration transferred,
the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer's
previously held equity interest in the acquiree (if any) over the fair value of the net identifiable assets
acquired and the liabilities assumed.
If, after reassessment, the Group's interest in the fair value of the acquiree's identifiable net assets
exceeds the sum of the consideration transferred, the amount of any non-controlling interests in the
acquiree and the fair value of the acquirer's previously held equity interest in the acquiree (if any), the
excess is recognised immediately in profit or loss as a bargain purchase gain.
Goodwill is not amortised but is reviewed for impairment at least annually. For the purpose of
impairment testing, goodwill is allocated to each of the Group's cash-generating units expected to
benefit from the synergies of the combination. Cash-generating units to which goodwill has been
allocated are tested for impairment annually, or more frequently when there is an indication that the
unit may be impaired. If the recoverable amount of the cash-generating unit is less than its carrying
amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated
to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of
each asset in the unit. An impairment loss recognised for goodwill is not reversed in a subsequent
period.
On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the
profit or loss on disposal.
Revenue recognition
Revenue is income arising in the course of the Group's ordinary activities. Revenue is recognised in
the amount of transaction price. Transaction price is the amount of consideration to which the Group
expects to be entitled in exchange for transferring control over promised goods or services to a
customer, excluding the amounts collected on behalf of third parties.
Revenue is recognised net of discounts, returns and value added taxes, other similar mandatory
payments.
Group's contracts with customers are fixed-price contracts and generally include both advance
payment and deferred payment for the same contracts. Generally the sales are made with a credit
term of 30-60 days, which is consistent with the market practice and consequently trade receivables
are classified as current assets.
A receivable is recognised when the goods are delivered or dispatched based on delivery terms as this
is the point in time that the consideration is unconditional because only the passage of time is required
before the payment is due (Note 18). Contract assets are immaterial and therefore not presented
separately in the consolidated financial statements.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
A contract liability is an entity's obligation to transfer goods or services to a customer for which the
entity has received consideration from the customer. Contract liabilities are included in trade and other
payables line item as advances from customers (Note 25).
Sales of goods
Sales are recognised when control of the good has transferred, being when the goods are delivered to
the customer, the customer has full discretion over the goods, and there is no unfulfilled obligation
that could affect the customer's acceptance of the goods. Delivery occurs when the goods have been
shipped to the specific location, the risks of obsolescence and loss have been transferred to the
customer, and either the customer has accepted the goods in accordance with the contract, the
acceptance provisions have lapsed, or the Group has objective evidence that all criteria for acceptance
have been satisfied.
Sales of transportation services
If the Group provides transportation services to the customer after control over goods has transferred,
revenue from such services is considered to be a separate performance obligation and is recognised
over the time of the service rendering because the customer receives and uses the benefits
simultaneously.
The Group provides services under fixed-price contracts. Revenue from providing services is recognised
in the accounting period in which the services are rendered. Revenue is recognised based on the actual
service provided to the end of the reporting period as a proportion of the total services to be provided.
This is determined based on proportion the actual distance relative to the total expected distance.
Where the contracts include multiple performance obligations, the transaction price is allocated to each
separate performance obligation based on the stand-alone selling prices. Where these are not directly
observable, they are estimated based on expected cost plus margin.
Estimates of revenues, costs or extent of progress toward completion are revised if circumstances
change. Any resulting increases or decreases in estimated revenues are reflected in profit or loss in
the period in which the circumstances that give rise to the revision become known by management.
In case of fixed price contracts, the customer pays the fixed amount based on a payment schedule. If
the services rendered by the Group exceed the payment, a contract asset arise. If the payments exceed
the services rendered, a contract liability is recognised. Contract assets from sales of transportation
services are immaterial and therefore not presented separately in the consolidated financial
statements.
Financing components
The Group does not expect to have any contracts where the period between the transfer of the
promised goods or services to the customer and payment by the customer exceeds one year. As a
consequence, the Group does not adjust any of the transaction prices for the time value of money.
Borrowing costs
General and specific borrowing costs directly attributable to the acquisition, construction or production
of assets that necessarily take a substantial time to get ready for intended use or sale (qualifying
assets) are capitalised as part of the costs of those assets, if the commencement date for capitalisation
is on or after 1 January 2009.
The commencement date for capitalisation is when (a) the Group incurs expenditures for the qualifying
asset; (b) it incurs borrowing costs; and (c) it undertakes activities that are necessary to prepare the
asset for its intended use or sale.
Capitalisation of borrowing costs continues up to the date when the assets are substantially ready for
their use or sale.

MMK INTEGRATED ANNUAL REPORT
158
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
The Group capitalises borrowing costs that could have been avoided if it had not made capital
expenditure on qualifying assets. Borrowing costs capitalised are calculated at the Group's average
funding cost (the weighted average interest cost is applied to the expenditures on the qualifying
assets), except to the extent that funds are borrowed specifically for the purpose of obtaining a
qualifying asset. Where this occurs, actual borrowing costs incurred on the specific borrowings less any
investment income on the temporary investment of these borrowings are capitalised.
Income tax
Income taxes have been provided for in the consolidated financial statements in accordance with
legislation enacted or substantively enacted by the end of the reporting period. The income tax charge
comprises current tax and deferred tax and is recognised in profit or loss for the year, except if it is
recognised in other comprehensive income or directly in equity because it relates to transactions that
are also recognised, in the same or a different period, in other comprehensive income or directly in
equity.
Current tax
Current tax is the amount expected to be paid to, or recovered from, the taxation authorities in respect
of taxable profits or losses for the current and prior periods. Taxable profit differs from profit for the
year as reported in the consolidated statement of comprehensive income because it excludes items of
income or expense that are taxable or deductible in other periods and it further excludes items that
are never taxable or deductible. The Group's liability for current tax is calculated using tax rates that
have been enacted or substantively enacted by the date of consolidated statement of financial position.
Deferred income tax
Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the
consolidated statement of financial position and the corresponding tax bases used in the computation
of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities
are generally recognised for all taxable temporary differences, and deferred tax assets are generally
recognised for all deductible temporary differences to the extent that it is probable that taxable profits
will be available against which those deductible temporary differences can be utilised. Such deferred
tax assets and liabilities are not recognised if the temporary difference arises from goodwill or from
the initial recognition (other than in a business combination) of assets and liabilities in a transaction
that affects neither the taxable profit nor the accounting profit when initially recorded.
Deferred tax assets for deductible temporary differences and tax loss carry forwards are recorded only
to the extent that it is probable that the temporary difference will reverse in the future and there is
sufficient future taxable profit available against which the deductions can be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year
in which the liability is settled or the asset realised, based on tax rates and tax laws that have been
enacted or substantively enacted by the date of consolidated statement of financial position. The
measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from
the manner in which the Group expects, at the reporting date, to recover or settle the carrying amount
of its assets and liabilities.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current
tax assets against current tax liabilities and when they relate to income taxes levied by the same
taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis.
Deferred tax assets and liabilities are netted only within the individual companies of the Group.

MMK INTEGRATED ANNUAL REPORT
159
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
Deferred income tax on post-acquisition retained earnings of subsidiaries
Deferred income tax is provided on post-acquisition retained earnings and other post acquisition
movements in reserves of subsidiaries, except where the Group controls the subsidiary's dividend
policy and it is probable that the difference will not reverse through dividends or otherwise in the
foreseeable future.
Uncertain tax positions
The Group's uncertain tax positions are reassessed by management at the end of each reporting period.
Liabilities are recorded for income tax positions that are determined by management as more likely
than not to result in additional taxes being levied if the positions were to be challenged by the tax
authorities. The assessment is based on the interpretation of tax laws that have been enacted or
substantively enacted by the end of the reporting period, and any known court or other rulings on such
issues. Liabilities for penalties, interest and taxes other than on income are recognised based on
management's best estimate of the expenditure required to settle the obligations at the end of the
reporting period. Adjustments for uncertain income tax positions other than interest and fines are
recorded within the income tax charge. Adjustments for income tax related interest and fines are
recorded within finance costs and other operating expenses respectively.
Property, plant and equipment
Manufacturing assets
Items of property, plant and equipment are measured at cost less accumulated depreciation and
impairment losses.
The cost of replacing part of an item of property, plant and equipment is recognised in the carrying
amount of the item if it is probable that the future economic benefits embodied within the part will
flow to the Group and its cost can be measured reliably. The carrying amount of the replaced part is
derecognised. Repair and maintenance expenses are charged to the consolidated statement of
comprehensive income as incurred.
Construction in progress comprises costs directly related to the construction of property, plant and
equipment including an appropriate allocation of directly attributable variable overheads that are
incurred in construction. Depreciation of these assets is recorded on the same basis as for other
property assets, and begins when it is available for use, i.e. when it is in the location and condition
necessary for it to be capable of operating in the manner intended by management.
At each reporting date management assesses whether there is any indication of impairment of
property, plant and equipment. If any such indication exists, management estimates the recoverable
amount, which is determined as the higher of an asset's fair value less costs of disposal and its value
in use. The carrying amount is reduced to the recoverable amount and the impairment loss is
recognised in the profit and loss. An impairment loss recognised for an asset in prior years is reversed
if there has been a change in the estimates used to determine the asset's value in use or fair value
less costs of disposal.
The gain or loss arising on the disposal or retirement of an item of property, plant and equipment is
determined as the difference between the sales proceeds and the carrying amount of the asset and is
recognised in the consolidated statement of comprehensive income within"Other operating
income/(expense), net ".

MMK INTEGRATED ANNUAL REPORT
160
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
Mineral rights
Mineral rights are presented as part of mining assets and include rights for evaluation, exploration and
production of mineral resources under the licenses or agreements. Such assets are carried at cost,
amortisation is charged on a straight-line basis over the shorter of the valid period of the license or
the agreement, or the expected life of mine, starting from the date when production activities
commence. The costs directly attributable to acquisition of rights for evaluation, exploration and
production are capitalised as a part of the mineral rights. If the reserves related to the mineral rights
are not economically viable, the carrying amount of such mineral rights is written off.
Depreciation
Land is not depreciated. Depreciation of manufacturing assets is computed under the straight-line
method utilising useful lives of the assets which are:
Buildings
1-50 years
Machinery and equipment
1-40 years
Transportation equipment
3-20 years
Fixtures and fittings
3-30 years
Mining assets
17-31 years
The estimated useful lives, residual values, and depreciation method are reviewed at each reporting
date, with the effect of any changes in estimate accounted for on a prospective basis.
Leased assets
The Group is a party to lease contracts as a lessee for, among others:
a) land under buildings and constructions,
b) building for office space, warehouses,
c) motor vehicles and machinery.
Leases are recognized, measured and presented in line with IFRS 16 "Leases".
Based on the accounting policy applied the Group recognizes a right-of-use asset and a lease liability
at the commencement date of the contract for all leases conveying the right to control the use of an
identified asset for a period of time. The commencement date is the date on which a lessor makes an
underlying asset available for use by a lessee.
The right-of-use assets are initially measured at cost, which comprises:
 the amount of the initial measurement of the lease liability;
 any lease payments made at or before the commencement date, less any lease incentives;
 any initial direct costs incurred by the lessee;
 an estimate of costs to be incurred by the lessee in dismantling and removing the underlying
assets or restoring the site on which the assets are located.
After the commencement date the right-of-use assets are measured at cost less any accumulated
depreciation and any accumulated impairment losses and adjusted for any re-measurement of the
lease liability.
If the lease transfers ownership of the underlying asset to the Group by the end of the lease term or
if the cost of the right-of-use asset reflects that the Group will exercise a purchase option, the Group
depreciates the right-of-use asset from the commencement date to the end of the useful life of the
underlying asset. Otherwise, the Group depreciates the right-of-use asset from the commencement
date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
The lease liability is initially measured at the present value of the lease payments that are not paid at
that date. Lease payments included in measurement of lease liability of the Group generally include
only fixed payments (including in-substance fixed payments), less any lease incentives receivable. The
lease liability excludes variable elements which are not based on an index or rate such as e.g. energy
usage. Variable lease payments not included in the initial measurement of the lease liability are
recognized directly in the profit and loss.
The lease payments are discounted using the interest rate implicit in the lease, if that rate can be
determined, or the group's incremental borrowing rate. Each lease payment is allocated between the
liability and finance cost. The finance cost is charged to profit or loss over the lease period so as to
produce a constant periodic rate of interest on the remaining balance of the liability for each period.
The right-of-use asset is depreciated over the shorter of the asset's useful life and the lease term on
a straight-line basis.
The lease term determined by the Group comprises:
 non-cancellable period of lease contracts;
 periods covered by an option to extend the lease if the lessee is reasonably certain to exercise
that option;
 periods covered by an option to terminate the lease if the lessee is reasonably certain not to
exercise that option.
After the commencement date the Group measures the lease liability by:
 increasing the carrying amount to reflect interest on the lease liability;
 reducing the carrying amount to reflect lease payments made;
 and re-measuring the carrying amount to reflect any reassessment or lease modifications.
Intangible assets, excluding goodwill
Intangible assets are recorded at cost less accumulated amortisation and impairment losses. Intangible
assets primarily represent licenses and various purchased software costs. Amortisation is charged on
a straight-line basis over their estimated useful lives which are:
Licenses
2 -17 years
Purchased software
1-20 years
Other intangibles
1-20 years
Impairment of tangible and intangible assets, excluding goodwill
Tangible and intangible assets are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be recoverable.
If any such indication exists, the recoverable amount of the asset is estimated in order to determine
the extent of the impairment loss (if any). Recoverable amount is the higher of fair value less costs of
disposal and value in use. In assessing value in use, the estimated future cash flows are discounted to
their present value using a pre-tax discount rate that reflects current market assessments of the time
value of money and the risks specific to the asset. Where it is not possible to estimate the recoverable
amount of an individual asset, the Group estimates the recoverable amount of the cash-generating
unit to which the asset belongs. Where a reasonable and consistent basis of allocation can be identified,
corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated
to the smallest group of cash-generating units for which a reasonable and consistent allocation basis
can be identified.

MMK INTEGRATED ANNUAL REPORT
162
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying
amount, the carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount.
An impairment loss is recognised immediately in the consolidated statement of comprehensive income.
Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating
unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying
amount does not exceed the carrying amount that would have been determined had no impairment
loss been recognised for the asset (cash-generating unit) in prior years. A reversal of an impairment
loss is recognised immediately in the consolidated statement of comprehensive income.
Inventories
Inventories are stated at the lower of cost and net realisable value. The cost of inventories is
determined on the weighted average basis and includes all costs in bringing the inventory to its present
location and condition.
Cost includes direct material, labour and an allocation of material and manufacturing overheads. Costs
of production in process and finished goods include the purchase costs of raw materials and conversion
costs such as direct labour and an allocation of fixed and variable production overheads. Raw materials
are valued at purchase cost inclusive of freight and other shipping costs.
Net realisable value represents the estimated selling price for inventories less estimated costs to
completion and selling costs. Where appropriate, an allowance for obsolete and slow-moving inventory
is recognised. The impairment charged to reduce the carrying amount of inventories to their net
realisable value and an allowance for obsolete and slow-moving inventory are included in consolidated
statement of comprehensive income as cost of sales.
Deferred drifting costs
The direct costs and attributable overheads of the preparation of underground coal reserves (drifting)
for production using advanced mining machinery are included in inventory and recognised as cost of
sales on the unit of production basis of each coal drift.
Value added taxes
Output value added tax related to sales is payable to tax authorities on the earlier of (a) collection of
receivables from customers or (b) delivery of goods or services to customers. Input VAT is generally
recoverable against output VAT upon receipt of the VAT invoice. The tax authorities permit the
settlement of VAT on a net basis. VAT reсeivable or/and payable balance accounted on the Group’s
companies is recognised in the consolidated statement of financial position on a gross basis and
disclosed separately as an asset and liability.
Assets classified as held for sale (or disposal group)
Non-current assets and disposal groups (which may include both non-current and current assets) are
classified in the consolidated statement of financial position as 'assets held for sale' if their carrying
amount will be recovered principally through a sale transaction (including loss of control of a subsidiary
holding the assets) within twelve months after the reporting period. Assets are reclassified when all of
the following conditions are met: (a) the assets are available for immediate sale in their present
condition; (b) the Group's management approved and initiated an active programme to locate a buyer;
(c) the assets are actively marketed for sale at a reasonable price; (d) the sale is expected within one
year; and (e) it is unlikely that significant changes to the plan to sell will be made or that the plan will
be withdrawn.
Non-current assets or disposal groups classified as held for sale in the current period's consolidated
statement of financial position are not reclassified or re-presented in the comparative consolidated
statement of financial position to reflect the classification at the end of the current period.

MMK INTEGRATED ANNUAL REPORT
163
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
A disposal group is a group of assets (current or non-current) to be disposed of, by sale or otherwise,
together as a group in a single transaction, and liabilities directly associated with those assets that will
be transferred in the transaction. Goodwill is included if the disposal group includes an operation within
a cash-generating unit to which goodwill has been allocated on acquisition. Non-current assets are
assets that include amounts expected to be recovered or collected more than twelve months after the
reporting period. If reclassification is required, both the current and non-current portions of an asset
are reclassified.
Held for sale disposal groups as a whole are measured at the lower of their carrying amount and fair
value less costs of disposal. Held for sale property, plant and equipment are not depreciated or
amortised. Reclassified non-current deferred taxes are not subject to write down to the lower of their
carrying amount and fair value less costs of disposal.
Liabilities directly associated with the disposal group that will be transferred in the disposal transaction
are reclassified and presented separately in the consolidated consolidated statement of financial
position.
Financial instruments - key measurement terms
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. The best evidence of fair value is
the price in an active market. An active market is one in which transactions for the asset or liability
take place with sufficient frequency and volume to provide pricing information on an ongoing basis.
Fair value of financial instruments traded in an active market is measured as the product of the quoted
price for the individual asset or liability and the number of instruments held by the entity. This is the
case even if a market's normal daily trading volume is not sufficient to absorb the quantity held and
placing orders to sell the position in a single transaction might affect the quoted price.
Valuation techniques such as discounted cash flow models or models based on recent arm's length
transactions or consideration of financial data of the investees are used to measure fair value of certain
financial instruments for which external market pricing information is not available. Fair value
measurements are analysed by level in the fair value hierarchy as follows: (i) level one are
measurements at quoted prices (unadjusted) in active markets for identical assets or liabilities, (ii)
level two measurements are valuations techniques with all material inputs observable for the asset or
liability, either directly (that is, as prices) or indirectly (that is, derived from prices), and (iii) level
three measurements are valuations not based on solely observable market data (that is, the
measurement requires significant unobservable inputs). Transfers between levels of the fair value
hierarchy are deemed to have occurred at the end of the reporting period. Refer to Note 31.
Transaction costs are incremental costs that are directly attributable to the acquisition, issue or
disposal of a financial instrument. An incremental cost is one that would not have been incurred if the
transaction had not taken place. Transaction costs include fees and commissions paid to agents
(including employees acting as selling agents), advisors, brokers and dealers, levies by regulatory
agencies and securities exchanges, and transfer taxes and duties. Transaction costs do not include
debt premiums or discounts, financing costs or internal administrative or holding costs.
Amortised cost ("AC") is the amount at which the financial instrument was recognised at initial
recognition less any principal repayments, plus accrued interest, and for financial assets less any
allowance for expected credit losses ('ECL'). Accrued interest includes amortisation of transaction costs
deferred at initial recognition and of any premium or discount to the maturity amount using the
effective interest method. Accrued interest income and accrued interest expense, including both
accrued coupon and amortised discount or premium (including fees deferred at origination, if any), are
not presented separately and are included in the carrying values of the related items in the consolidated
statement of financial position.

MMK INTEGRATED ANNUAL REPORT
164
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
The effective interest method is a method of allocating interest income or interest expense over the
relevant period, so as to achieve a constant periodic rate of interest (effective interest rate) on the
carrying amount. The effective interest rate is the rate that exactly discounts estimated future cash
payments or receipts (excluding future credit losses) through the expected life of the financial
instrument or a shorter period, if appropriate, to the gross carrying amount of the financial instrument.
The effective interest rate discounts cash flows of variable interest instruments to the next interest
repricing date, except for the premium or discount which reflects the credit spread over the floating
rate specified in the instrument, or other variables that are not reset to market rates. Such premiums
or discounts are amortised over the whole expected life of the instrument. The present value calculation
includes all fees paid or received between parties to the contract that are an integral part of the
effective interest rate.
Financial instruments - initial recognition
Financial instruments at FVTPL are initially recorded at fair value. All other financial instruments are
initially recorded at fair value adjusted for transaction costs. Fair value at initial recognition is best
evidenced by the transaction price. A gain or loss on initial recognition is only recorded if there is a
difference between fair value and transaction price which can be evidenced by other observable current
market transactions in the same instrument or by a valuation technique whose inputs include only data
from observable markets. After the initial recognition, an ECL allowance is recognised for financial
assets measured at AC and investments in debt instruments measured at FVOCI, resulting in an
immediate accounting loss.
All purchases and sales of financial assets that require delivery within the time frame established by
regulation or market convention ("regular way" purchases and sales) are recorded at trade date, which
is the date on which the Group commits to deliver a financial asset. All other purchases are recognised
when the entity becomes a party to the contractual provisions of the instrument.
The Group uses discounted cash flow valuation techniques to determine the fair value of currency
swaps, loans to related parties that are not traded in an active market. Differences may arise between
the fair value at initial recognition, which is considered to be the transaction price, and the amount
determined at initial recognition using a valuation technique with level 3 inputs. If any differences
remain after calibration of model inputs, such differences are amortised on a straight line basis over
the term of the currency swaps, loans to related parties. The differences are immediately recognised
in profit or loss if the valuation uses only level 1 or level 2 inputs.
Financial assets - classification and subsequent measurement - measurement categories
The Group classifies financial assets in the following measurement categories: FVTPL, FVOCI and AC.
The classification and subsequent measurement of debt financial assets depends on: (i) the Group's
business model for managing the related assets portfolio and (ii) the cash flow characteristics of the
asset. As of 31 December
2021 and 31 December
2020 the Group did not hold financial assets at FVOCI.
Financial assets - classification and subsequent measurement - business model
The business model reflects how the Group manages the assets in order to generate cash
flows - whether the Group's objective is: (i) solely to collect the contractual cash flows from the assets
("hold to collect contractual cash flows",) or (ii) to collect both the contractual cash flows and the cash
flows arising from the sale of assets ("hold to collect contractual cash flows and sell") or, if neither of
(i) and (ii) is applicable, the financial assets are classified as part of "other" business model and
measured at FVTPL.

MMK INTEGRATED ANNUAL REPORT
165
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
Business model is determined for a group of assets (on a portfolio level) based on all relevant evidence
about the activities that the Group undertakes to achieve the objective set out for the portfolio available
at the date of the assessment. Factors considered by the Group in determining the business model
include the purpose and composition of a portfolio, past experience on how the cash flows for the
respective assets were collected, how risks are assessed and managed, how the assets' performance
is assessed and how managers are compensated.
Financial assets - classification and subsequent measurement - cash flow characteristics
Where the business model is to hold assets to collect contractual cash flows or to hold contractual cash
flows and sell, the Group assesses whether the cash flows represent solely payments of principal and
interest ("SPPI"). Financial assets with embedded derivatives are considered in their entirety when
determining whether their cash flows are consistent with the SPPI feature. In making this assessment,
the Group considers whether the contractual cash flows are consistent with a basic lending
arrangement, i.e. interest includes only consideration for credit risk, time value of money, other basic
lending risks and profit margin.
Where the contractual terms introduce exposure to risk or volatility that is inconsistent with a basic
lending arrangement, the financial asset is classified and measured at FVTPL. The SPPI assessment is
performed on initial recognition of an asset and it is not subsequently reassessed.
The group holds the trade receivables with the objective to collect contractual cash flows and therefore
measures them subsequently at amortised cost using the effective interest method. Details about the
Group's impairment policies and the expected credit loss measurement are provided in Note 18.
Financial assets - reclassification
Financial instruments are reclassified only when the business model for managing the portfolio as a
whole changes. The reclassification has a prospective effect and takes place from the beginning of the
first reporting period that follows after the change in the business model. The Group did not change
its business model during the current and comparative period and did not make any reclassifications.
Financial assets impairment - credit loss allowance for ECL
The Group assesses, on a forward-looking basis, the ECL for financial assets measured at AC. The
Group measures ECL and recognises net impairment losses on financial assets at each reporting date.
The measurement of ECL reflects: (i) an unbiased and probability weighted amount that is determined
by evaluating a range of possible outcomes, (ii) time value of money and (iii) all reasonable and
supportable information that is available without undue cost and effort at the end of each reporting
period about past events, current conditions and forecasts of future conditions.
Trade and other receivables are presented in the consolidated statement of financial position net of
the allowance for ECL.

MMK INTEGRATED ANNUAL REPORT
166
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
The Group applies simplified approach for impairment of trade receivables. Note 18 provides
information about the details of the applied approach and the provision matrix for trade receivables.
For other financial assets that are subject to IFRS 9 ECL model the Group applies a three stage model
for impairment, based on changes in credit quality since initial recognition. A financial instrument that
is not credit-impaired on initial recognition is classified in Stage 1. Financial assets in Stage 1 have
their ECL measured at an amount equal to the portion of lifetime ECL that results from default events
possible within the next 12 months or until contractual maturity, if shorter ("12 Months ECL"). If the
Group identifies a significant increase in credit risk ("SICR") since initial recognition, the asset is
transferred to Stage 2 and its ECL is measured based on ECL on a lifetime basis, that is, up until
contractual maturity but considering expected prepayments, if any ("Lifetime ECL"). Refer to Note 28
for a description of how the Group determines when a SICR has occurred. If the Group determines
that a financial asset is credit-impaired, the asset is transferred to Stage 3 and its ECL is measured as
a Lifetime ECL. The Group's definition of credit impaired assets and definition of default is explained in
Note 28. Note 28 provides information about inputs, assumptions and estimation techniques used in
measuring ECL.
Cash and cash equivalents are also subject to the impairment requirements of IFRS 9, identified
expected credit loss was not material.
Financial assets - write-off
Financial assets are written-off, in whole or in part, when the Group exhausted all practical recovery
efforts and has concluded that there is no reasonable expectation of recovery. The write-off represents
a derecognition event. Indicators that there is no reasonable expectation of recovery include:
 the counterparty experiences a significant financial difficulty as evidenced by its financial
information that the Group obtains;
 the counterparty considers bankruptcy or a financial reorganisation;
 there is adverse change in the payment status of the counterparty as a result of changes in the
national or local economic conditions that impact the counterparty.
The Group may write-off financial assets that are still subject to enforcement activity when the Group
seeks to recover amounts that are contractually due, however, there is no reasonable expectation of
recovery.
Financial assets - derecognition
The Group derecognises financial assets when (a) the assets are redeemed or the rights to cash flows
from the assets otherwise expire or (b) the Group has transferred the rights to the cash flows from the
financial assets or entered into a qualifying pass-through arrangement whilst (i) also transferring
substantially all the risks and rewards of ownership of the assets or (ii) neither transferring nor
retaining substantially all the risks and rewards of ownership but not retaining control.
Control is retained if the counterparty does not have the practical ability to sell the asset in its entirety
to an unrelated third party without needing to impose additional restrictions on the sale.
Financial assets - modification
The Group sometimes renegotiates or otherwise modifies the contractual terms of the financial assets.
The Group assesses whether the modification of contractual cash flows is substantial considering,
among other, the following factors: any new contractual terms that substantially affect the risk profile
of the asset (e.g. profit share or equity-based return), significant change in interest rate, change in
the currency denomination, new collateral or credit enhancement that significantly affects the credit
risk associated with the asset or a significant extension of a loan when the borrower is not in financial
difficulties.

MMK INTEGRATED ANNUAL REPORT
167
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
If the modified terms are substantially different, the rights to cash flows from the original asset expire
and the Group derecognises the original financial asset and recognises a new asset at its fair value.
The date of renegotiation is considered to be the date of initial recognition for subsequent impairment
calculation purposes, including determining whether a SICR has occurred. The Group also assesses
whether the new loan or debt instrument meets the SPPI criterion. Any difference between the carrying
amount of the original asset derecognised and fair value of the new substantially modified asset is
recognised in profit or loss, unless the substance of the difference is attributed to a capital transaction
with owners.
In a situation where the renegotiation was driven by financial difficulties of the counterparty and
inability to make the originally agreed payments, the Group compares the original and revised expected
cash flows to assess whether the risks and rewards of the asset are substantially different as a result
of the contractual modification. If the risks and rewards do not change, the modified asset is not
substantially different from the original asset and the modification does not result in derecognition.
The Group recalculates the gross carrying amount by discounting the modified contractual cash flows
by the original effective interest rate, and recognises a modification gain or loss in profit or loss.
Financial liabilities - measurement categories
Financial liabilities are classified as subsequently measured at AC, except for (i) financial liabilities at
FVTPL: this classification is applied to derivatives, financial liabilities held for trading (e.g. short
positions in securities), contingent consideration recognised by an acquirer in a business combination
and other financial liabilities designated as such at initial recognition and (ii) financial guarantee
contracts and loan commitments. As of 31 December
2021 and 31 December
2020 the Group did not have financial guarantee contracts and loan commitments or financial liabilities
at FVTPL.
Financial liabilities - derecognition
Financial liabilities are derecognised when they are extinguished (i.e. when the obligation specified in
the contract is discharged, cancelled or expires).
An exchange between the Group and its original lenders of debt instruments with substantially different
terms, as well as substantial modifications of the terms and conditions of existing financial liabilities,
are accounted for as an extinguishment of the original financial liability and the recognition of a new
financial liability. The terms are substantially different if the discounted present value of the cash flows
under the new terms, including any fees paid net of any fees received and discounted using the original
effective interest rate, is at least 10% different from the discounted present value of the remaining
cash flows of the original financial liability. In addition, other qualitative factors, such as the currency
that the instrument is denominated in, changes in the type of interest rate, new conversion features
attached to the instrument and change in loan covenants are also considered. If an exchange of debt
instruments or modification of terms is accounted for as an extinguishment, any costs or fees incurred
are recognised as part of the gain or loss on the extinguishment. If the exchange or modification is not
accounted for as an extinguishment, any costs or fees incurred adjust the carrying amount of the
liability and are amortised over the remaining term of the modified liability.
Modifications of liabilities that do not result in extinguishment are accounted for as a change in estimate
using a cumulative catch up method, with any gain or loss recognised in profit or loss, unless the
economic substance of the difference in carrying values is attributed to a capital transaction with
owners.

MMK INTEGRATED ANNUAL REPORT
168
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
Offsetting financial instruments
Financial assets and liabilities are offset and the net amount reported in the consolidated statement of
financial position only when there is a legally enforceable right to offset the recognised amounts, and
there is an intention to either settle on a net basis, or to realise the asset and settle the liability
simultaneously. Such a right of set off (a) must not be contingent on a future event and (b) must be
legally enforceable in all of the following circumstances: (i) in the normal course of business, (ii) in the
event of default and (iii) in the event of insolvency or bankruptcy.
Trade and other receivables
Trade and other receivables are recognised initially at fair value and are subsequently carried at AC
using the effective interest method.
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at call with banks, and other short-term
highly liquid investments with original maturities of three months or less. Cash and cash equivalents
are carried at AC because: (i) they are held for collection of contractual cash flows and those cash
flows represent SPPI, and (ii) they are not designated at FVTPL. Features mandated solely by
legislation, such as the bail-in legislation in certain countries, do not have an impact on the SPPI test,
unless they are included in contractual terms such that the feature would apply even if the legislation
is subsequently changed. Restricted balances are excluded from cash and cash equivalents for the
purposes of the consolidated cash flow statement. Balances restricted from being exchanged or used
to settle a liability for at least twelve months after the reporting period are included in other non-current
assets.
Trade and other payables
Trade and other payables are accrued when the counterparty performs its obligations under the
contract and are recognised initially at fair value and subsequently carried at AC using the effective
interest method.
Borrowings
Borrowings are recognised initially at fair value, net of transaction costs incurred, and are subsequently
carried at amortised cost using the effective interest method.
Employee benefit obligations
Remuneration to employees in respect of services rendered during the period is recognised as an
expense in the consolidated statement of comprehensive income.
Defined contribution plans
The Group's Russian subsidiaries and the Parent Company are legally obliged to make defined
contributions to the Russian Federation State Pension Fund (a defined contribution plan financed on a
pay-as-you-go basis). The Group's contributions to the Russian Federation State Pension Fund relating
to defined contribution plans are charged to consolidated statement of comprehensive income in the
period to which they relate.
In the Russian Federation all state social contributions, including contributions to the Russian
Federation State Pension Fund, are collected through social contributions calculated by the application
of a regressive rate of the annual gross remuneration of each employee. This rate depends on the
annual gross remuneration of each employee.
The Group's obligations for contributions to other defined contribution plans are recognised as
expense as incurred.

MMK INTEGRATED ANNUAL REPORT
169
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
Defined benefit plans
The Group accounts for the cost of defined benefit plans using the projected unit credit method. Under
this method, the cost of providing pensions is charged to the consolidated statement of comprehensive
income, so as to attribute the total pension cost over the service lives of employees in accordance with
the benefit formula of the plan. The Group's obligation in respect of defined retirement benefit plans
is calculated separately for each defined benefit plan by discounting the amounts of future benefits
that employees have already earned through their service in the current and prior periods. The discount
rate applied represents the yield on government bonds that have maturity dates approximating the
terms of the Group's obligations.
The current service cost of the defined benefit plan, recognised in profit and loss in employee benefit
expense reflects the increase in the defined benefit obligation resulting from employee service in the
current year, benefit changes, curtailments and settlements. Past-service costs are recognised
immediately in profit and loss.
The net interest cost is calculated by applying the discount rate to the net balance of the defined
benefit obligation. This cost is included in employee benefit expense in the profit and loss in the
consolidated statement of comprehensive income. Actuarial gains and losses are fully recognised in
other comprehensive income in the period they occur.
Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result
of a past event, it is probable that the Group will be required to settle the obligation, and a reliable
estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the
present obligation at the date of consolidated statement of financial position, taking into account the
risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows
estimated to settle the present obligation, its carrying amount is the present value of those cash flows.
When some or all of the economic benefits required to settle a provision are expected to be recovered
from a third party, the receivable is recognised as an asset if it is virtually certain that reimbursement
will be received and the amount of the receivable can be measured reliably.
Site restoration provision
The Group provides for the costs of restoring a site where a legal or constructive obligation exists. The
amount recognized as a provision is the best estimate of the expenditure required to settle the present
obligation at the reporting date. The estimated future land restoration costs, discounted to net present
value, are capitalised in respective items of property, plant and equipment and amortised over the
useful life of the corresponding asset. In case at the date when the site restoration obligation arise no
corresponding assets exist relative provision is included in the consolidated statement of
comprehensive income as other expenses.
The Group reviews site restoration provisions at each reporting date and adjusts them to reflect the
current best estimate. The risks and uncertainties that inevitably surround many events and
circumstances are taken into account in reaching the best estimate of a provision. Changes in the
measurement of a provision that result from changes in the estimated timing or amount of cash
outflow, or a change in the discount rate, are added to or deducted from the costs of the related assets
as appropriate in the current period or when there are no relative assets are recognised in the
consolidated statement of comprehensive income as other expenses.
Provisions are discounted to their present value based on the rates of government bonds adjusted for
the specific risk which are consistent with the currency and estimated term of the liability. The
unwinding of the obligation is included in the consolidated statement of comprehensive income as
finance costs before revising the provision at year end.

MMK INTEGRATED ANNUAL REPORT
170
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
4. Significant Accounting Policies (continued)
Dividends
Dividends and related taxation thereon are recognised as a liability in the period in which they have
been declared and become legally payable.
The maximum dividend payable is restricted to the total accumulated retained earnings of the Parent
Company determined according to Russian law.
Segment information
Segment reporting is presented on the basis of management's perspective and relates to the parts of
the Group that are defined as operating segments. Operating segments are identified on the basis of
internal reports to the Group's chief operating decision maker ("CODM"). The Group has identified the
General Director of the Parent Company as its CODM and the internal reports used by the top
management team to oversee operations and make decisions on allocating the resources serve as the
basis of information presented. These internal reports are prepared on the same basis as these
consolidated financial statements.
Based on the current management structure, the Group has identified three reportable segments:
Steel (Russia), Steel (Turkey) and Coal mining.
5. Critical accounting judgements and key sources of estimation uncertainty
In the application of the Group's accounting policies, management is required to make judgements,
estimates and assumptions about the carrying amounts of assets and liabilities that are not readily
apparent from other sources. The estimates and associated assumptions are based on historical
experience and other factors that are considered to be relevant. As a result of the volatility in the
global and Russian financial markets, management's estimates may change and result in a significant
impact on the Group. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimate is revised if the revision affects only that
period or in the period of the revision and future periods if the revision affects both current and future
periods.
Critical judgements in applying accounting policies
The following are the critical judgments, including those involving estimations (see below), that the
management has made in the process of applying the Group's accounting policies and that have the
most significant effect on the amounts recognised in the consolidated financial statements and affect
the amounts of assets and liabilities within the next financial year.
Key sources of estimation uncertainty
The following are the key assumptions concerning the future, and other key sources of estimation
uncertainty at the end of the reporting period that affect the amounts recognised in the consolidated
financial statements and have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year.
Useful economic life and residual value of property, plant and equipment
The Group's property, plant and equipment are depreciated using the straight-line method over their
estimated useful lives which are based on management's business plans and operational estimates,
related to those assets.
The factors that could affect the estimation of useful lives and residual values include the following:
 changes in asset utilisation rates;
 changes in maintenance technology;
 changes in regulations and legislation; and

MMK INTEGRATED ANNUAL REPORT
171
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
5. Critical accounting judgements and key sources of estimation uncertainty (continued)
 unforeseen operational issues.
Any of the above could affect prospective depreciation of property, plant and equipment and their
carrying and residual values.
Management periodically reviews the appropriateness of assets' useful economic lives. The review is
based on the current condition of the assets and the estimated period during which they will continue
to bring economic benefits to the Group.
Site restoration provision
The Group estimates site restoration provision based on management's understanding of the current
legal requirements and internally generated engineering estimates and represents management's best
estimate of the present value of the future costs required.
Future events that may affect the amount required to settle an obligation are reflected in the amount
of a provision where there is sufficient objective evidence that they will occur. Significant estimates
and assumptions are made in determining the amount of restoration provisions. Those estimates and
assumptions deal with uncertainties such as: requirements of the relevant legal and regulatory
framework, the magnitude of possible contamination and the timing, extent and costs of required
restoration activity. These uncertainties may result in future actual expenditure differing from the
amounts currently provided.
The provision recognised for each site is periodically reviewed and updated based on the facts and
circumstances available at the time. Changes to the estimated future costs for operating sites are
recognised in the consolidated statement of financial position by adjusting both the restoration asset
if it exists and provision. Such changes give rise to a change in future depreciation and financial
charges. For closed sites, changes to estimated costs are recognised immediately in the consolidated
statement of comprehensive income. Details are disclosed in Note 23.
Impairment of assets
The Group periodically evaluates the recoverability of the carrying amount of its assets. Whenever
events or changes in circumstances indicate that 1) the carrying amounts of those assets may not be
recoverable, or, 2) impairment losses previously recognised, should be reversed, the Group estimates
the recoverable amount of the asset. This requires the Group to make judgments regarding long-term
forecasts of future revenues and costs related to the assets subject to review. In turn, these forecasts
are uncertain in that they require assumptions about demand for products and future market
conditions. Significant and unanticipated changes to these assumptions and estimates included within
the impairment reviews could result in significantly different results than those recorded in the
consolidated financial statements. Details of the assumptions are disclosed in Note 16.
Initial recognition of related party transactions
In the normal course of business the Group enters into transactions with its related parties. IFRS 9
requires initial recognition of financial instruments based on their fair values. Judgement is applied in
determining if transactions are priced at market or non-market interest rates, where there is no active
market for such transactions. The basis for judgement is pricing for similar types of transactions with
unrelated parties and effective interest rate analyses. Terms and conditions of related party balances
are disclosed in Note 27.

MMK INTEGRATED ANNUAL REPORT
172
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
5. Critical accounting judgements and key sources of estimation uncertainty (continued)
ECL measurement
Measurement of ECLs is a significant estimate that involves determination methodology, models and
data inputs. Details of ECL measurement methodology are disclosed in Notes 18 and 28. The following
components have a major impact on credit loss allowance: definition of default, SICR, probability of
default ("PD"), exposure at default ("EAD"), and loss given default ("LGD"). The Group regularly
reviews and validates the models and inputs of the models to reduce any differences between expected
credit loss estimates and actual credit loss experience. The expected credit loss allowance for trade
receivables is determined according to provision matrix based on the number of days that an asset is
past due. The effect of adjustments for forward looking information from the models of
macro-economic scenarios do not have significant impact on ECL estimation because performance
obligations are generally short-term in nature.
Income tax and other taxes
The Group is subject to income tax and other taxes in numerous jurisdictions. Significant judgement
is required in determining the provision for income tax and other taxes due to the complexity of the
tax legislation of the Russian Federation and of other countries, where the Group's entities operate.
There are many transactions and calculations for which the ultimate tax determination is uncertain.
The Group recognises liabilities for anticipated tax inspection issues based on estimates of whether
additional taxes will be due. Where the final tax outcome of these matters is different from the amounts
that were initially recorded, such differences will impact the amount of tax expense and tax provisions
in the period in which such determination is made.
In addition, the Group records deferred tax assets at each date of the consolidated statement of
financial position based on the amount that management believes is probable to be utilised in future
periods. This determination is based on estimates of future profitability. A change in these estimates
could result in the write-off of deferred tax assets in future periods for assets that are currently
recorded in the consolidated statement of financial position. In estimating levels of future profitability,
the Group has considered historical results of operations in recent years and would, if necessary,
consider the implementation of prudent and feasible tax planning strategies to generate future
profitability.
Write-off policy
Financial assets are written-off, in whole or in part, when the Group exhausted all practical recovery
efforts and has concluded that there is no reasonable expectation of recovery. Determining the cash
flows for which there is no reasonable expectation of recovery requires judgement. Management
considered the following indicators that there is no reasonable expectation of recovery: receivables
being past due over 360 days, liquidation or bankruptcy proceedings, fair value of collateral is less
than the costs to repossess it or enforcement activities were completed.
Measurement of right-of-use assets and liabilities
Extension and termination options are included in a number of property and equipment leases across
the Group. These terms are used to maximise operational flexibility in terms of managing contracts.
The majority of extension and termination options held are exercisable only by the Group and not by
the respective lessor.
In determining the lease term, management considers all facts and circumstances that create an
economic incentive to exercise an extension option, or not exercise a termination option. Extension
options (or periods after termination options) are only included in the lease term if the lease is
reasonably certain to be extended (or not terminated). The assessment is reviewed if a significant
event or a significant change in circumstances occurs which affects this assessment and that is within
the control of the lessee.

MMK INTEGRATED ANNUAL REPORT
173
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
6. Revenue
By product (including transportation services)
2021
2020
Hot rolled steel
5,497
2,542
Galvanised steel
2,304
1,154
Long steel products
886
601
Galvanised steel with polymeric coating
846
577
Cold rolled steel
820
496
Wire, sling, bracing
237
130
Hardware products
183
132
Tin plated steel
161
119
Band
137
79
Slabs
117
5
Coking production
115
72
Formed section
78
81
Scrap
77
69
Tubes
64
43
Coal
40
21
Others
307
274
Total
11,869
6,395
By customer destination
2021
2020
Russian Federation and the CIS
74%
83%
Middle East
11%
7%
Europe
7%
3%
Asia
4%
5%
Africa
2%
2%
North America
1%
- %
South America
1%
- %
Total
100%
100%
By type of performance obligation
2021
2020
Revenue from sales of products – at point in time
11,375
6,073
Revenue from transportation services – over time
494
322
Total
11,869
6,395
7. Segment Information
An operating segment is a component of the Group that engages in business activities from which it
may earn revenues and incur expenses, including revenues and expenses that relate to transactions
with any of the Group's other components. IFRS 8 requires operating segments to be identified on the
basis of internal reports about components of the Group that are regularly reviewed by the chief
operating decision maker ("CODM") in order to allocate resources to the segments and to assess their
performance, and for which discrete financial information is available.
Based on the current management structure and internal reporting the Group has identified the
following operating segments:
 Steel segment (Russia), which includes the Parent Company and its subsidiaries involved in
production of steel, wire and hardware products. All significant assets, production and
management and administrative facilities of this segment are located in the cities of Magnitogorsk
and Lysva (Russian Federation);
 Steel segment (Turkey), which includes MMK Metalurji involved in production of steel. The two
sites of this segment are located in Iskenderun and Istanbul (Turkey); and

MMK INTEGRATED ANNUAL REPORT
174
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
7. Segment Information (continued)
 Coal mining segment, which includes OJSC Belon and LLC MMK Ugol involved in mining and
refining of coal. All significant assets, production and management and administrative facilities
of this segment are located in the city of Belovo (Russian Federation).
The profitability of the three operating segments is primarily measured by CODM based on Segment
EBITDA. Segment EBITDA is determined as segment's operating profit adjusted to exclude depreciation
and amortisation expense and loss on disposal of property, plant and equipment, and to include the
share of result of associates, including the impairment of investments in associates. Since this term is
not a standard measure in IFRS the Group's definition of EBITDA may differ from that of other
companies.
Inter-segment pricing is determined on a consistent basis using market benchmarks.
The following table presents measures of segment results for the years ended 31 December
2021 and 2020:
Steel
(Russia)
Steel
(Turkey)
Coal
mining
Eliminations
Total
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
Revenue (including
transportation
revenue)
Sales to external
customers
10,643
5,855
1,184
518
42
22
-
-
11,869
6,395
Inter-segment sales
457
117
-
-
403
157
(860)
(274)
-
-
Total revenue
11,100
5,972
1,184
518
445
179
(860)
(274)
11,869
6,395
Segment EBITDA
3,909
1,440
203
34
235
13
(57)
5
4,290
1,492
Depreciation and
amortisation
(462)
(437)
(13)
(17)
(34)
(30)
-
-
(509)
(484)
Loss on disposal of
property, plant and
equipment
(27)
(65)
-
-
(1)
(1)
-
-
(28)
(66)
Operating profit/(loss)
per IFRS financial
statements
3,420
938
190
17
200
(18)
(57)
5
3,753
942
A reconciliation from operating profit per IFRS financial statements to profit before taxation is included
in the consolidated statement of comprehensive income.
At 31 December
2021 and 2020, the segments' total assets and liabilities were reconciled to total assets and liabilities
as follows:
31 December
2021
Steel
(Russia)
Steel
(Turkey)
Coal
mining
Eliminations
Total
Total assets
9,930
1,038
599
(1,852)
9,715
Total liabilities
3,128
341
145
(229)
3,385
31 December
2020
Steel
(Russia)
Steel
(Turkey)
Coal
mining
Eliminations
Total
Total assets
8,266
499
400
(1,673)
7,492
Total liabilities
2,757
95
99
(60)
2,891

MMK INTEGRATED ANNUAL REPORT
175
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
7. Segment Information (continued)
The segmental additions to property, plant and equipment and intangible assets for the years ended
31 December
2021 and 31 December
2020 were:
2021
2020
Steel (Russia)
1,078
679
Steel (Turkey)
18
5
Coal mining
71
57
Total capital expenditure
1,167
741
8. Cost of sales
2021
2020
Raw materials used
5,861
3,422
Payroll and social taxes
643
602
Depreciation of property, plant and equipment
483
459
Other expenses
258
202
7,245
4,685
Changes in work in progress, finished goods and goods-in-transit
(217)
6
Total
7,028
4,691
9. General and administrative expenses
2021
2020
Payroll and social taxes
116
103
Taxes other than income tax
29
33
Depreciation and amortisation
25
24
Professional services
24
22
Insurance
3
2
Materials
4
4
Other
22
17
Total
223
205
10. SELLING AND DISTRIBUTION EXPENSES
2021
2020
Transportation expenses
579
398
Export duties (Note 30)
218
-
Materials
24
16
Payroll and social taxes
15
13
Packing costs
13
37
Advertising expenses
3
2
Depreciation
1
1
Other
24
25
Total
877
492

MMK INTEGRATED ANNUAL REPORT
176
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
11. Other operating income/(expense), net
2021
2020
Loss on disposal of property, plant and equipment
(28)
(66)
Provision for advances issued
(2)
-
Provision for legal claims
(2)
(17)
Gain on disposal of other assets
25
13
Gain/(loss) on disposal of subsidiaries
3
(3)
Insurance compensation of damage
16
9
Other operating gain, net
-
1
Total
12
(63)
12. Other expenses
For the years ended 31 December
2021 and 2020, other expenses included USD 45 million and USD 58 million, respectively, related to
social programs and maintenance of social assets.
13. Finance Costs
2021
2020
Interest expense on bonds
23
23
Interest expense on provisions
10
13
Interest expense on borrowings
4
1
Expenses related to withholding tax in respect to dividends paid in prior
periods and related compensation, net (Note 27)
-
6
Other
-
1
Total
37
44
14. Foreign exchange gain/(loss), net
2021
2020
Foreign exchange gain/(loss) from operating activities, net
10
(9)
Foreign exchange gain/(loss) from financing activities, net
21
(120)
Total
31
(129)
15. Income Taxes
The Group’s income tax expense attributable to different tax jurisdictions for the years ended 31
December
2021 and 2020 was:
2021
2020
Current income tax
787
167
Adjustments recognised in current year relating to prior year current income
tax
1
-
Deferred income tax expense, net
76
19
Total income tax expense
864
186

MMK INTEGRATED ANNUAL REPORT
177
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
15. Income Taxes (continued)
The income tax charge is different from that which would be obtained by applying the Russian
Federation statutory income tax rate to profit before income tax. A reconciliation between the expected
and the actual taxation charge is provided below.
2021
2020
Profit before income tax
3,985
790
Theoretical income tax charge
797
158
Adjustments due to:
Effect of different tax rates
16
-
Expenses not deductible
9
12
Change in unrecognized deferred tax assets
(4)
(5)
Cash equity contribution discount
(21)
-
Adjustments recognised in current year relating to prior year current tax
1
-
Effect of Turkish currency depreciation for tax accounting purposes
63
-
Unrecognized deferred tax assets as a result of difference between functional
and tax accounting currency
-
15
Other
3
6
Income tax expense
864
186
Deferred income tax assets and liabilities comprise income tax effect of the differences arising between
the tax and accounting bases of the following assets and liabilities:
31
December
2021
Recognised
in profit or
loss
Effect of
translation
to
presen-tatio
n currency
31 December
2020
Property, plant and equipment
14
(1)
-
15
Investments
2
-
-
2
Unused tax losses
14
(1)
-
15
Investment tax credits
1
(3)
-
4
Inventories
37
22
-
15
Accounts receivable
7
-
-
7
Site restoration provision
21
(6)
-
27
Accounts payable
24
-
-
24
Deferred tax set off
(55)
5
-
(60)
Deferred income tax assets
65
16
-
49
Property, plant and equipment
(448)
(73)
2
(377)
Right-of-use assets
(2)
(2)
-
-
Intangible assets
(2)
-
-
(2)
Investments
(3)
-
-
(3)
Inventories
(48)
(11)
-
(37)
Accounts receivable
(6)
(2)
-
(4)
Loans
(1)
1
-
(2)
Deferred tax set off
55
(5)
-
60
Deferred income tax liabilities
(455)
(92)
2
(365)
Net deferred tax
liability
(390)
(76)
2
(316)

MMK INTEGRATED ANNUAL REPORT
178
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
15. Income Taxes (continued)
31
December
2020
Recognised
in profit or
loss
Effect of
translation to
presen-tation
currency
31
December
2019
Property, plant and equipment
15
1
(3)
17
Investments
2
-
-
2
Unused tax losses
15
(2)
(3)
20
Investment tax credits
4
(1)
-
5
Inventories
15
4
(3)
14
Accounts receivable
7
3
-
4
Site restoration provision
27
(12)
(8)
47
Accounts payable
24
3
(2)
23
Deferred tax set off
(60)
6
11
(77)
Deferred income tax assets
49
2
(8)
55
Property, plant and equipment
(377)
(9)
71
(439)
Intangible assets
(2)
-
-
(2)
Investments
(3)
(1)
-
(2)
Inventories
(37)
(10)
3
(30)
Accounts receivable
(4)
6
3
(13)
Loans
(2)
(1)
-
(1)
Deferred tax set off
60
(6)
(11)
77
Deferred income tax liabilities
(365)
(21)
66
(410)
Net deferred tax
liability
(316)
(19)
58
(355)
At 31 December
2021 and 2020, the aggregate amount of temporary differences associated with undistributed earnings
of subsidiaries for which deferred tax liabilities have not been recognised was USD 847 million and
USD 558 million, respectively. No liabilities have been recognised in these consolidated financial
statements in respect of these differences because the Group is in a position to control the timing of
the reversal of the temporary differences and it is probable that such differences will not reverse in
the foreseeable future.
Based upon historical taxable income and projections for future taxable income over the periods in
which deferred income tax assets are deductible, management of the Group believes that the Group
will realise the benefits of the deductible differences.
All deferred tax assets have been recognised in 2021. Deferred tax assets of USD 4 million have not
been recognised in 2020 (which don't include related to tax losses) because it is not probable that
future taxable profits will be available against which the Group can utilise the benefits therefrom.
At 31 December
2021 unrecognised deferred tax assets other than related to tax losses were USD 3 million (31
December 2020: USD 58 million). Tax losses expire in the following years:
31 December
Year of expiry
2021
2020
Without expiry date
9
9
From 2 to 5 years
-
11
9
20

MMK INTEGRATED ANNUAL REPORT
179
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
16. Property, Plant and Equipment
Land and
buildings
Machinery
and
equipment
Trans-port
ation
equipment
Fixtures
and fittings
Mining
assets
Construc-ti
on-in-progr
ess
Total
Cost
At 1 January 2020
3,219
6,574
205
185
109
994
11,286
Additions
1
184
3
3
-
535
726
Transfers
157
339
2
13
-
(511)
-
Site restoration provision
-
-
-
-
(1)
-
(1)
Disposals
(39)
(312)
(4)
(6)
(13)
(13)
(387)
Effect of translation to
presentation currency
(425)
(910)
(28)
(30)
(18)
(165)
(1,576)
At 31 December 2020
2,913
5,875
178
165
77
840
10,048
Additions
2
148
5
1
-
997
1,153
Transfers
84
264
22
15
-
(385)
-
Site restoration provision
-
-
-
-
(9)
-
(9)
Disposals
(8)
(174)
(4)
(2)
-
(17)
(205)
Utilised allowance for
impairment losses
-
-
-
-
-
(3)
(3)
Effect of translation to
presentation currency
(14)
(30)
(1)
(1)
-
(13)
(59)
At 31 December
2021
2,977
6,083
200
178
68
1,419
10,925
Depreciation
At 1 January 2020
(1,493)
(4,210)
(142)
(158)
(74)
(29)
(6,106)
Charge for the year
(84)
(367)
(14)
(10)
(2)
-
(477)
Reversal of impairment
-
-
-
-
-
3
3
Disposals
16
265
4
6
13
-
304
Effect of translation to
presentation currency
169
541
19
25
11
4
769
At 31 December 2020
(1,392)
(3,771)
(133)
(137)
(52)
(22)
(5,507)
Charge for the year
(93)
(376)
(18)
(8)
(2)
-
(497)
Reversal/(accrual) of
impairment
235
15
-
-
-
-
250
Utilised allowance for
impairment losses
-
-
-
-
-
3
3
Disposals
4
146
3
2
-
2
157
Effect of translation to
presentation currency
7
18
1
1
-
-
27
At 31 December
2021
(1,239)
(3,968)
(147)
(142)
(54)
(17)
(5,567)
Carrying amount
At 31 December 2020
1,521
2,104
45
28
25
818
4,541
At 31 December
2021
1,738
2,115
53
36
14
1,402
5,358
Carrying amount had no
impairment taken place
At 31 December 2020
1,895
2,188
46
28
37
840
5,034
At 31 December
2021
1,877
2,139
54
35
26
1,419
5,550
For the year ended 31 December
2021 and 2020 Group capitalised borrowing costs USD 1 million and USD 1 million to property, plant
and equipment, respectively.
At 31 December
2021 and 2020 there is no property, plant and equipment pledged.
Capital commitments are disclosed in Note 30.

MMK INTEGRATED ANNUAL REPORT
180
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
16. Property, Plant and Equipment (continued)
At 31 December
2021 carrying amount of the construction in progress included impairment provision of USD 17 million
(31 December
2020: USD 22 million).
During the year ended 31 December
2021 the Group utilized the provision for impairment in the amount of USD 3 million. During the year
ended 31 December 2020 management approved the decision to restart the modernisation project and
reversed previously recognised provision on amount of USD 3 million.

MMK INTEGRATED ANNUAL REPORT
181
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
16. Property, Plant and Equipment (continued)
As of 31 December 2020, the management analysed changes in the economy, metals industry and the
Group's business since 31 December 2019 and decided to test non-current assets for impairment for
all CGUs of the Group: Steel segment (Russia), Steel segment (Turkey) and Coal mining segment. As
the result of the impairment test no impairment was identified for all CGUs as at 31 December 2020.
In 2021 global recovery of business activity in Russia and several regions of the world from COVID-19
consequences has continued. An increased demand for metal products against the backdrop of limited
supply was observed at the world markets. As a result, the prices for metal products were steadily
high at the main global markets during the entire year. In 2021 the Group's management successfully
launched production of hot-rolled steel at metallurgical complex in the Republic of Turkey, with plans
to reach full capacity in 2022.
The Group's management assessed the abovementioned circumstances as indicators of reversal of the
impairment loss previously recognized in respect of the cash generating unit (CGU) - Steel segment
(Turkey) - one of the operating segments of the Group. The management prepared calculation of
recoverable value of non-current assets for this operating segment using discounted cash flows (DCF)
model based on value in use. As the result of the test the partial reversal of previously recorded
impairment for Steel (Turkey) in the amount of USD 250 million was recognized as at 31 December
2021.
The recoverable was calculated using projected cash flows for 5 years prepared by an extrapolation of
actual financial data for 9 months 2021 and the management's forecast for 4 quarter 2021 as the base
period over the next 5 years, using projected growth rates. Cash flows beyond the five-year period
were extrapolated based on long-term growth rate.
The following assumptions were used for the calculation of recoverable value of non-current assets as
at 31 December
2021 for the Steel segment (Turkey) CGU:
 Sales volume in 2022 is expected to go 83% up vs. 2021, remaining flat in 2023, 2024, 2025
and 2026;
 Average steel products price in 2022 is expected to go 19% down vs. 2021, 15% down in 2023,
1% down in 2024, 3% down in 2025 and 2% up in 2026;
 EBITDA margin in the terminal period is projected at 10.9%;
 Growth rate beyond five years is projected at 2.4%;
 A pre-tax discount rate was estimated in USD terms based on the weighted average cost of
capital basis and was 15.47% (post-tax rate was 13.1%).
The estimates of future discounted cash flows and the results of calculation of recoverable value of
non-current assets are particularly sensitive in the following areas for the Steel segment (Turkey) CGU:
 a 10% decrease in future planned volume of sales would lead to decrease of the reversal amount
by USD 75 million;
 a decrease in average steel products price for 1% would lead to decrease of the reversal amount
by USD 98 million;
 a 0.5% increase in the post-tax discount rate would lead to decrease of the reversal amount by
USD 37 million;
 a 0.5% decrease in growth rate beyond five years would lead to decrease of the reversal amount
by USD 14 million.

MMK INTEGRATED ANNUAL REPORT
182
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
17. Inventories
31 December
2021
2020
Raw materials
883
661
Finished goods and goods for resale
464
279
Work in progress
227
160
Goods in transit
2
1
Deferred drifting costs
50
48
Total
1,626
1,149
Allowance for obsolete and slow-moving items and write down to net
realisable value
(20)
(21)
Total inventories, net
1,606
1,128
The movement in the allowance for obsolete and slow-moving items and write down to net realisable
value was as follows:
2021
2020
Balance at the beginning of the year
21
29
Change in allowance
(1)
(4)
Effect of translation to presentation currency
-
(4)
Balance at the end of the year
20
21
18. Trade and Other Receivables
31 December
2021
2020
Trade receivables
1,080
528
Other receivables
8
9
Expected credit loss allowance
(28)
(32)
Total financial assets within trade receivables
1,060
505
Advances paid
82
42
Prepaid expenses
28
27
Other receivables
21
32
Total trade and other receivables
1,191
606
Guarantee letters received in relation to trade receivables that are not impaired amounted to
USD 137 million (31 December
2020: USD 119 million).

MMK INTEGRATED ANNUAL REPORT
183
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
18. Trade and Other Receivables (continued)
The Group applies the IFRS 9 simplified approach to measuring expected credit losses which uses a
lifetime expected loss allowance for all trade receivables.
To measure the expected credit losses, trade receivables have been grouped based on shared credit
risk characteristics and the days past due.
The expected loss rates are based on the payment profiles of customers over a period of 36 month
before each balance sheet date and the corresponding historical credit losses experienced within this
period. The effect from adjustments to historical loss rates for macroeconomic factors is not material
because performance obligations are short-term in nature.
The credit loss allowance for trade receivables is determined according to provision matrix presented
in the table below. The provision matrix is based on the number of days that an asset is past due.
31 December
2021
2020
Gross carrying
amount
Lifetime ECL
Gross
carrying
amount
Lifetime ECL
Current
1,036
2
484
1
Less than 30 days overdue
22
-
21
-
30 to 90 days overdue
4
1
2
1
91 to 180 days overdue
3
2
1
1
over 180 days overdue
15
15
20
20
Total financial assets within trade
receivables
1,080
-
528
-
Expected сredit loss allowance
-
20
-
23
Total financial assets within trade
receivables (carrying amount)
1,060
-
505
-
The following table explains the changes in the credit loss allowance for trade receivables under
simplified ECL model between the beginning and the end of the annual period:
2021
2020
Balance at the beginning of the year
23
25
Changes in estimates and assumptions
-
2
Total credit loss allowance charge in profit or loss for the
period
-
2
Expected credit loss utilised
(2)
(1)
Effect of translation to presentation currency
(1)
(3)
Balance at the end of the year
20
23
As a result of the credit risk analysis for other receivables, the total amount of the estimated expected
credit losses for other financial receivables amounted to USD 8 million as at 31 December
2021 (USD 9 million as at 31 December
2020). The amount of the provision was primarily formed in respect of financial assets impaired as a
result of default in Phase 3 of the "three-stage" model. The change in the estimated ECL on other
receivables in 2021 and 2020 is not material.

MMK INTEGRATED ANNUAL REPORT
184
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
19. Investments in securities and other financial assets
31 December
2021
2020
Non-current financial assets
Unlisted securities
6
2
Total non-current
6
2
Current financial assets
Trading debt securities
7
7
Bank deposits, USD
521
200
Total current
528
207
Trading debt securities are liquid publicly traded bonds and notes of Russian companies and banks.
They are reflected at period-end market value based on trade prices obtained from investment brokers.
The expected credit losses for bank deposits balances are not material. The analysis of the credit
quality of bank deposits is as follows:
31 December
2021
2020
ВВB- to ВBВ+ rated
521
200
Total
521
200
20. Cash and Cash Equivalents
31 December
2021
2020
Cash, RUB
1
-
Cash in banks, USD
271
255
Cash in banks, RUB
105
44
Cash in banks, EUR
11
8
Cash in banks, others
1
1
Cash in transit, USD
-
1
Bank deposits, RUB
125
461
Bank deposits, USD
313
85
Bank deposits, EUR
16
1
Bank deposits, TRY
-
2
Total
843
858
The expected credit losses for cash and cash equivalents balances are not material. The analysis of the
credit quality of bank balances and deposits is as follows:
31 December
2021
2020
A-to AA+ rated
26
8
ВВB- to ВBВ+ rated
596
575
BB- to BB+ rated
92
215
B- to B+ rated
124
55
Other
5
5
Total
843
858
Based on the credit ratings of independent rating agencies Standard&Poors and Fitch ratings.

MMK INTEGRATED ANNUAL REPORT
185
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
21. Share Capital
Common stock
31 December
2021
2020
Authorised, issued and fully paid common shares with a par value of
RUB 1 each (in thousands)
11,174,330
11,174,330
Treasury stock
At 31 December
2021 and 31 December
2020, the Group did not hold issued common shares of the Parent Company as treasury stock.
Currency translation reserve
The currency translation reserve comprises all foreign exchange differences arising from the translation
of the consolidated financial statements of foreign operations and translation to presentation currency.
The reserve is dealt with in accordance with the accounting policies set out in Note 4.
Shareholders' voting rights
The shareholders of fully paid common stock are entitled to one vote per share at the annual general
shareholders' meeting of the Parent Company.
Dividends
On 25 December 2020, the Parent Company declared dividends of RUB 2.391 (USD 0.032) per ordinary
share representing total dividends of USD 357 million. In January and February 2021 dividends were
paid out.
On 28 May 2021, the Parent Company declared dividends of RUB 0.945 (USD 0.013) for the year
ended 31 December 2020 and RUB 1.795 (USD 0.024) for the period ended 31 March 2021 per ordinary
share representing total dividends of USD 144 million and USD 273 million, respectively. In June and
July 2021 dividends were paid out.
On 10 September 2021, the Parent Company declared dividends of RUB 3.530 (USD 0.048) per
ordinary share representing total dividends of USD 539 million. In September 2021 dividends were
paid out.
On 24 December 2021, the Parent Company declared dividends of RUB 2.663 (USD 0.036) per ordinary
share representing total dividends of USD 406 million. In January 2022 dividends were partially paid
out (Note 32).
22. Long-term borrowings
31 December
2021
2020
Unsecured listed bonds, USD
479
478
Unsecured loans, EUR
44
70
Unsecured borrowings, RUR
5
-
Total
528
548
Borrowings
The Group has various borrowing arrangements denominated in RUB, USD and EUR with various
lenders. Those borrowings consist of unsecured loans and credit facilities. At 31 December
2021 and 2020, the total unused element of all credit facilities was USD 1,771 million and USD 1,494
million, respectively.

MMK INTEGRATED ANNUAL REPORT
186
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
22. Long term borrowings (continued)
According to the terms of the borrowings, the Group is required to comply with a number of
covenants, including under certain financial ratios. The Group was in compliance with covenants during
the reporting periods and as at 31 December
2021 and 2020.
Debt repayment schedule
Year ended
31 December
2021
2022 (presented as current portion of long-term borrowings, Note 26)
59
2023
34
2024
475
2025
17
2026 and thereafter
2
Total
587
Year ended
31 December
2020
2021 (presented as current portion of long-term borrowings, Note 26)
60
2022
56
2023
30
2024
451
2025 and thereafter
11
Total
608
Eurobonds
On 13 June 2019, the Group issued 5 year USD 500 million eurobonds with an annual coupon rate of
4.375% payable semi-annually to finance its general corporate purposes. The bonds are repayable on
13 June 2024. The Group issued bonds through a consolidated structured entity MMK International
Capital DAC incorporated in Ireland. This entity was consolidated as it was specifically set up for the
purposes of the Group, and the Group has exposure to substantially all the risks and rewards through
outstanding guarantees of the entity's obligations. The Group guarantees all obligations of this entity
represented by the bonds issued.

MMK INTEGRATED ANNUAL REPORT
187
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
22. Long term borrowings (continued)
Net Debt Reconciliation
The table below sets out an analysis of net debt. Net debt reconciliation is a reconciliation of the
movements in the Group's liabilities from financing activities net of cash and cash equivalents and
bank deposits for each of the periods presented. The items of these liabilities are those that are
reported as financing in the consolidated statement of cash flows:
Borrowings
(Notes 22, 26)
Leases
Cash and
cash
equivalents
(Note 20)
Bank
deposits
(Note 19)
/Interest
income
Total
At 1 January 2020
(860)
(10)
1,105
-
235
Cash flows, net
(43)
4
(200)
179
(60)
Effect of translation to presentation
currency and exchange rate changes
(32)
-
(47)
1
(78)
Interest (charge)/income
(24)
(1)
-
20
(5)
Change in lease, net
-
(4)
-
-
(4)
At 31 December 2020
(959)
(11)
858
200
88
Cash flows, net
(5)
5
(4)
296
292
Effect of translation to presentation
currency and exchange rate changes
30
2
(11)
1
22
Interest (charge)/income
(27)
(1)
-
23
(5)
Change in lease, net
-
(5)
-
-
(5)
Other
-
-
-
1
1
At 31 December
2021
(961)
(10)
843
521
393
For the purposes of this disclosure interest income amounts include interest accrued on all bank
deposits (Note 19 and 20).
23. Site restoration provision
2021
2020
Balance at the beginning of the year
136
237
Unwinding of discount rate
8
12
Change in estimates
(24)
(63)
Provision utilised
(12)
(11)
Effect of translation to presentation currency
-
(39)
Balance at the end of the year
108
136
Included in the consolidated statement of financial position as:
Long-term portion of site restoration provision
96
125
Current portion of site restoration provision
12
11
Total
108
136
According to environmental regulation and Ecological program approved by the management in 2013
the Group recognised a provision for restoration of land and open pit in Magnitogorsk up to 2040. At
the moment of provision recognition there were no assets in the consolidated statement of financial
position related to this provision due the open pit was depleted long years ago.
In 2021 the management reassessed the cost of restoration of open pit due to changes in discount
rate and site restoration expenses and decreased relative provision by USD 15 million accordingly and
recognized it in related line in consolidated statements of comprehensive income. Provision for
restoration and closing of mine shaft was decreased by USD 9 million due to changes in discount rate
and recognised in the costs of related assets.

MMK INTEGRATED ANNUAL REPORT
188
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
23. Site restoration provision (continued)
In 2020 management changed the restoration plan for the part of depleted open pit by appropriate
submission of technical project, as the result, provision for restoration decreased by 71 million. Due
to the implemented changes the Group plans to complete its restoration program for other parts of the
depleted open pit in 2030. Changes in discount rate and site restoration expenses led to increase of
related provision by USD 9 million. All those changes were recognized in related line in consolidated
statements of comprehensive income.
Provision for restoration and closing of mine shaft was decreased by USD 1 million due to changes in
discount rate and recognised in the costs of related assets.
The Group used discount rate of 8.5% (2020: 5.9%) to calculate provision.
24. Defined contribution plans
Contributions to the Russian Federation State Pension Fund amounted to USD 130 million and USD
123 million for the years ended 31 December
2021 and 2020, respectively.
25. Trade and Other Payables
31 December
2021
2020
Trade accounts payable
848
620
Dividends payable
413
370
Total financial payables within trade and other payables
1,261
990
Advances from customers
284
243
Other taxes payable
108
48
Salaries payable
61
55
Claims provision
19
19
Other current liabilities
37
25
Total trade and other payables
1,770
1,380
Performance obligations of the Group are short-term in nature. Consequently all advances to customers
as of 1 January 2021 and 2020 were recognised in revenue during the years ended 31 December
2021 and 2020 respectively.
The maturity profile of the Group's financial payables within trade and other payables was as follows:
31 December
2021
2020
Due in:
1 month
1,007
823
1-3 months
200
109
3 months to 1 year
54
58
Total
1,261
990

MMK INTEGRATED ANNUAL REPORT
189
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
26. Short-term borrowings and current portion of long-term borrowings
31 December
2021
2020
Short-term borrowings:
Unsecured loans, EUR
204
246
Unsecured loans, RUB
-
40
Unsecured borrowings, RUB
6
2
Unsecured loans, USD
164
63
374
351
Current portion of long-term borrowings:
Unsecured listed bonds, USD
21
21
Unsecured loans, EUR
38
39
59
60
Total
433
411
At 31 December
2021 and 2020 short-term loans were not secured.
Short-term borrowings and current portion of long-term borrowings are repayable as follows:
31 December
2021
2020
Due in:
1 month
12
9
1-3 months
296
262
3 months to 1 year
125
140
Total
433
411
27. Related Parties
Transactions and balances outstanding with related parties
Transactions between the Parent Company and its subsidiaries, which are related parties of the Parent
Company, have been eliminated on consolidation and are not disclosed in this note.
The Group enters into transactions with related parties in the ordinary course of business for the
purchase and sale of goods and services and in relation to the provision of financing agreements to
and from the Group entities. Transactions with related parties are generally performed on arm's length
basis.
Details of transactions with and balances between the Group and related parties at 31 December
2021 and 2020 and for the years ended 31 December
2021 and 2020 are disclosed below.
In 2020 the Group received monetary reimbursement of expenses incurred in June 2020 related to
withholding tax in respect to dividends paid in prior periods in the amount of USD 7 million from the
Parent company's major shareholder (Note 13).
a) Transactions with associates of the Group
2021
2020
Revenue
9
3
Purchases
-
5
Other expenses
4
6

MMK INTEGRATED ANNUAL REPORT
190
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
27. Related Parties (continued)
31 December
Balances outstanding
2021
2020
Trade and other receivables
2
-
b) Transactions with other related parties
2021
2020
Revenue
1,230
383
Purchases
5
4
Bank charges
1
1
31 December
Balances outstanding
2021
2020
Cash and cash equivalents
35
35
Borrowings
6
1
Trade and other receivables
169
106
Other related parties include entities under common control with the Group and companies controlled
by key management personnel of the Group.
The amounts outstanding are unsecured and will be settled in cash.
Remuneration of the Group’s key management personnel
Key management personnel include key management of the Group and members of the Board of
Directors and receive only short-term employment benefits. For the years ended 31 December
2021 and 2020, total key management personnel compensation included in general and administrative
expenses amounted to USD 12 million and USD 8 million, respectively, including social taxes.
28. RISK MANAGEMENT ACTIVITIES
The main risks inherent to the Group's operations are those related to liquidity risk, credit risk
exposures, market movements in interest rates, equity investment prices and fluctuations in foreign
exchange rates. A description of the Group's risks and associated management policies in relation to
these risks are detailed below.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to settle all liabilities as they fall due.
The Group's liquidity position is carefully monitored and managed. The Group has in place a detailed
budgeting and cash forecasting process to help ensure that it has adequate cash available to meet its
payment obligations.
Presented below is the maturity profile of the Group's borrowings (the maturity profiles for financial
liabilities within trade and other payables are presented in Notes 25) based on contractual
undiscounted payments, including interest:

MMK INTEGRATED ANNUAL REPORT
191
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
28. RISK MANAGEMENT ACTIVITIES (continued)
2021
Total
Due
within
one month
Due
from one
to three
months
Due
from three
to twelve
months
Due
in one
year to
later
Fixed rate borrowings
Principal
722
7
114
94
507
Interest
57
-
1
23
33
779
7
115
117
540
Floating rate borrowings
Principal
243
5
181
11
46
Total fixed and floating rate
borrowings
1,022
12
296
128
586
2020
Total
Due
within
one month
Due
from one
to three
months
Due
from three
to twelve
months
Due
in one
year to
later
Fixed rate borrowings
Principal
902
3
264
111
524
Interest
78
-
-
23
55
980
3
264
134
579
Floating rate borrowings
Principal
64
6
-
10
48
64
6
-
10
48
Total fixed and floating rate
borrowings
1,044
9
264
144
627
Credit risk
Credit risk refers to the risk that one party to a financial instrument will default on its contractual
obligations resulting in a financial loss to the Group. Credit risk arises from cash and cash equivalents
and deposits with banks as well as credit exposures to customers and other counterparties, including
outstanding uncollateralised trade and other receivables.
The Group's maximum exposure to credit risk is represented by the carrying amount of financial assets
recorded in the consolidated financial statements, net of any impairment losses.
Credit risk is the one of the largest risks for the Group's business; management therefore carefully
manages its exposure to credit risk. Prior to acceptance of a new customer, the Group assesses the
customer's credit quality and defines credit limits. Credit limits attributable to customers are regularly
reviewed, at a minimum annually.
At 31 December
2021 and 2020, the Group assessed credit quality for trade and other receivables including trade and
other receivables from related parties by type of customers as follows:
31 December
2021
2020
Automobile producers
123
66
Traders
364
180
Tube plants
197
74
Other industries
376
185
Total
1,060
505

MMK INTEGRATED ANNUAL REPORT
192
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
28. RISK MANAGEMENT ACTIVITIES (continued)
Expected credit loss (ECL) measurement
ECL is a probability-weighted estimate of the present value of future cash shortfall (i.e., the weighted
average of credit losses, with the respective risks of default occurring in a given time period used as
weights). An ECL measurement is determined by evaluating a range of possible outcomes. ECL
measurement is based on four components used by the Group: Probability of Default ("PD"), Exposure
at Default ("EAD"), Loss Given Default ("LGD") and Discount Rate.
EAD is an estimate of exposure at a future default date, taking into account expected changes in the
exposure after the reporting period. PD is an estimate of the likelihood of default to occur over a given
time period. LGD is an estimate of the loss arising on default. It is based on the difference between
the contractual cash flows due and those that the lender would expect to receive, including from any
collateral. The expected losses are discounted to present value at the end of the reporting period. The
discount rate represents the effective interest rate ("EIR") for the financial instrument or an
approximation thereof.
Expected credit losses are modelled over instrument's lifetime period. The lifetime period is equal to
the remaining contractual period to maturity of debt instruments, adjusted for expected prepayments,
if any.
Management models Lifetime ECL, that is, losses that result from all possible default events over the
remaining lifetime period of the financial instrument. The 12-month ECL, represents a portion of
lifetime ECLs that result from default events on a financial instrument that are possible within 12
months after the reporting period, or remaining lifetime period of the financial instrument if it is less
than a year.
The ECLs that are estimated by management for the purposes of these consolidated financial
statements are point-in-time estimates, rather than through-the-cycle estimates. The estimates
consider forward looking information, that is, ECLs reflect probability weighted development of key
macroeconomic variables that could have an impact on credit risk.
For purposes of measuring probability of default, the group defines default as a situation when the
exposure meets one or more of the following criteria:
 the customer is more than 90 days past due on its contractual payments;
 international rating agencies have classified the customer in the default rating class;
 the customer meets the unlikeliness-to-pay criteria listed below:
- the customer is insolvent;
- the customer is in breach of financial covenants; and
- it is becoming likely that the customer will enter bankruptcy.
For purposes of disclosure, the Group fully aligned the definition of default with the definition of
credit-impaired assets. The default definition stated above is applied to all types of financial assets of
the Group.
An instrument is considered to no longer be in default (i.e. to have cured) when it no longer meets the
default criteria that was applicable to the relevant counterparty.
The assessment whether or not there has been a significant increase in credit risk ("SICR") since initial
recognition is performed on an individual basis. The criteria used to identify a SICR are monitored and
reviewed periodically for appropriateness by the Group's management. The presumption, being that
there have been significant increases in credit risk since initial recognition when financial assets are
more than 30 days past due, has not been rebutted.
The Group considers a financial instrument to have experienced a SICR when one or more of the
following quantitative, qualitative or backstop criteria have been met. For trade and other receivables:

MMK INTEGRATED ANNUAL REPORT
193
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
28. RISK MANAGEMENT ACTIVITIES (continued)
 30 days past due;
 commencement of legal proceedings with the counterparty in respect of the existing debt;
 Relative threshold: the Group regularly monitors debtors with increased credit risk and, depending
on the assessment of macroeconomic, industry and other relevant factors, considers if such debtors
have a SICR.
The level of ECL that is recognised in these consolidated financial statements depends on whether the
credit risk of the debtor has increased significantly since initial recognition.
Foreign currency risk
Foreign currency risk is the risk that the financial results of the Group will be adversely impacted by
changes in exchange rates to which the Group is exposed.
The objective of the Group's foreign exchange risk management is to minimise the volatility of the
Group's cash flows arising from fluctuations in foreign exchange rates. Management focuses on
assessing the Group's future cash flows in foreign currencies and managing the gaps arising between
inflows and outflows. Currently, the Group does not use hedging instruments to manage exchange rate
exposures.
At 31 December
2021 and 2020, the carrying amounts of the Group's monetary assets and liabilities denominated in
foreign currencies other than its functional currency were as follows:
31 December
2021
31 December
2020
EUR
USD
EUR
USD
Assets
Cash and cash equivalents
27
483
7
317
Deposits
-
521
-
200
Trade receivables
15
305
12
189
Total assets
42
1,309
19
706
Liabilities
Trade and other payables
(53)
(93)
(56)
(91)
Borrowings
(290)
(501)
(361)
(501)
Total liabilities
(343)
(594)
(417)
(592)
Total net position
(301)
715
(398)
114
The table below details the Group's sensitivity to devaluation of the RUB against USD and EUR by 10%
(2020: 10%), which management believes is an appropriate measure in the current market conditions
and which would impact its operations.
EUR impact
USD impact
2021
2020
2021
2020
Loss or profit
(30)
(40)
72
11
Capital
(30)
(40)
72
11
Interest rate risk
Interest rate risk arises from the possibility that changes in interest rates will affect the value of
financial instruments. Interest rate risk is not material for the Group.
Equity and debt investment price risk
Investment price risk arising from holding equity and debt investments is not material for the Group.

MMK INTEGRATED ANNUAL REPORT
194
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
29. CAPITAL MANAGEMENT
The Group manages its capital to ensure that entities in the Group will be able to continue as a going
concern while maximising the return to shareholders through the optimisation of debt and equity.
As at 31 December
2021 the capital structure of the Group consists of debt (borrowings and obligations under leases) in
the amount of USD 971 million (31 December 2020: USD 970 million), share capital of USD 386 million
(31 December 2020: USD 386 million) and retained earnings of USD 11,281 million
(31 December 2020: USD 9,522 million).
The management of the Group reviews the Group's capital structure on an annual basis. As part of this
review, management considers the cost of capital and the risks associated with each class of capital.
Based on their recommendations, the Group balances its overall capital structure through the payment
of dividends as well as the issue of new debt or the redemption of existing debt. The Group monitors
capital on the basis of the debt-to-equity ratio (to be not higher than 1:1). Additionally, the Group
monitors the adequacy of its debt level using the net debt to EBITDA ratio.
There were no significant changes in the Group's approach to capital management during the year
ended 31 December
2021 in comparison to the prior period.
30. Commitments and contingencies
Commitments for expenditure
In the course of carrying out its operations and other activities the Group enters into various
agreements which require the Group to invest in or provide financing to specific projects or
undertakings.
In the opinion of the Group's management, these commitments are entered into under standard terms,
which are representative of each project's feasibility and should not result in unreasonable losses to
the Group.
At 31 December
2021, the Group had purchase agreements of approximately USD 1,137 million to acquire property,
plant and equipment (31 December
2020: USD 678 million).
At 31 December
2021, the Group had purchase agreements of approximately USD 3,838 million to acquire in future
periods through 2022-2027 coking coal, zinc, iron ore and natural gas (31 December
2020: USD 3,305 million).
As at 31 December
2021, future cash outflows of USD 80 million (undiscounted) to which the Group is potentially exposed
to during the land lease term have not been included in the lease liability because they include variable
lease payments that are linked to cadastral value (31 December
2020: USD 83 million).
Penalties are payable or receivable under these agreements in certain circumstances and where supply
terms are not adhered to. Management does not expect such conditions to result in a loss to the Group.
In the past, the Group transferred social assets to local municipal authorities. The Group's management
expects that the Group will continue to partly fund these social operations for the foreseeable future.
These costs are recognised in the consolidated statement of comprehensive income as incurred (Note
12).
Letters of guarantee
At 31 December
2021 the Group had letters of guarantee obtained from banks and given to suppliers amounted to USD
254 million (31 December
2020: USD 207 million).

MMK INTEGRATED ANNUAL REPORT
195
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
30. Commitments and contingencies (continued)
Russian business environment
The Russian Federation displays certain characteristics of an emerging market. Its economy is
particularly sensitive to oil and gas prices. The legal, tax and regulatory frameworks continue to
develop and are subject to frequent changes and varying interpretations. The Russian economy
continues to be negatively impacted by ongoing political tension in the region and international
sanctions against certain Russian companies and individuals. Firm oil prices, low unemployment and
rising wages supported a modest growth of the economy in 2021. The operating environment has a
significant impact on the Group's operations and financial position.
In June 2021, the Russian Government approved the introduction of temporary combined duties on
the export of ferrous and non-ferrous metals from August 1 to December 31, 2021. The Group applied
it's judgement and considers these duties as additional charge, but not a part of the product price. As
the customers do not reimburse these duties to the Group, but rather pay the agreed price, the Group
decided to account for these export duties in selling expenses, but not as the reduction of revenue
(Note 10).
From 1 January 2022 an excise tax on liquid steel has been introduced and the mineral extraction tax
(MET) was increased. In general, excise tax on liquid steel should be calculated in relation to the mass
of semi-finished products obtained from liquid steel as 2.7% of the monthly average export market
price of steel slabs. Along with that, if the steel is smelted in open-hearth, induction and (or) electric
steelmaking furnaces and if the share of ferrous scrap in the total mass of raw materials used for the
production of liquid steel is at least 80%, the excise tax should be calculated as 30% of the difference
between monthly average export market price of steel billet and average monthly market price of
scarp on the Russian market minus 12.5 thousand rubles and 50% of the cost of purchased ferroalloys
and alloying elements. MET for iron ore should be calculated on the weight of iron ore mined as 4.8%
of the index SGX TSI Iron Ore CFR China (62% Fe Fines) Index Futures/Options multiplied by the ratio
of the actual iron content in the ore to the reference value (62%). MET rate for coking coal is set as
1,5% of average price of coking coal for related tax period based on the index SGX TSI FOB Australia
Premium Coking Coal OTC Futures/Options.
In the first half of 2021 Russia's Federal Antimonopoly Service (hereinafter, "FAS") initiated
proceedings in respect to violation of anti-monopoly legislation against PAO MMK and other Russian
metals companies operating in the Russian hot-rolled flat steel product market. On 10 February 2022,
FAS Commission completed consideration of anti-monopoly legislation violations and assessed PAO
MMK's activities from January 2021 in the Russian hot-rolled flat steel product market as violation of
Article 10.1.1 of the Competition Law. At the time of issuing these financial statements, FAS neither
issued any order to PAO MMK for rectification of the violation nor initiated an administrative offence
case. PAO MMK strongly disagrees with the final conclusions of Russia's FAS Commission and related
decision and will defend its position in court with regard to economic justification of their pricing and
MMK's commitment to fair competition principles. Management cannot reliably estimate the impact of
these proceedings on the financial statements and, therefore, does not make a provision for potential
losses resulting from the decision taken by FAS.
In 2022 ongoing foreign political tension escalated as a result of further developments in Ukraine which
may have negative impact on commodity and financial markets, and increased volatility, particularly
with regard to foreign exchange rates and financial markets. There is an expectation of further
sanctions and limitations on business activity of companies operating in respective regions, as well as
consequences on the economy in general, but the full nature and possible effects of these are unknown.
Management is taking necessary measures to ensure sustainability of the Group's operations. However,
the future effects of the current economic situation are difficult to predict and management's current
expectations and estimates could differ from actual results.

MMK INTEGRATED ANNUAL REPORT
196
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
30. Commitments and contingencies (continued)
Taxation contingencies in the Russian Federation
Russian tax legislation which was enacted or substantively enacted at the end of the reporting period,
is subject to varying interpretations when being applied to the transactions and activities of the Group.
Consequently, tax positions taken by management and the formal documentation supporting the tax
positions may be challenged by tax authorities. Russian tax administration is gradually strengthening,
including the fact that there is a higher risk of review of tax transactions without a clear business
purpose or with tax incompliant counterparties. Fiscal periods remain open to review by the authorities
in respect of taxes for three calendar years preceding the year when decisions about the review was
made. Under certain circumstances reviews may cover longer periods.
The Russian transfer pricing (TP) legislation is generally aligned with the international TP principles
developed by the Organisation for Economic Cooperation and Development (OECD), although it has
specific features. The TP legislation provides for the possibility of additional tax assessment for
controlled transactions (transactions between related parties and certain transactions between
unrelated parties) if such transactions are not on an arm's-length basis. The Management has
implemented internal controls to comply with current TP legislation.
Tax liabilities arising from controlled transactions are determined based on their actual transaction
prices. It is possible, with the evolution of the interpretation of TP rules, that such prices could be
challenged. The impact of any such challenge cannot be reliably estimated; however, it may be
significant to the financial position and/or the Group's operations.
Started 1 January 2015 the Controlled Foreign Company (CFC) legislation came into force in Russian
Federation, according to which Russian taxpayers have to report and pay taxes on retained earnings
of foreign companies and non-corporate structures (including trusts) owned and controlled by Russian
tax residents. CFC income is subject to a 20% tax rate. The Group's management believes, that the
Group's taxation policy complies with the Russian CFC legislation requirements.
As Russian tax legislation does not provide definitive guidance in certain areas, the Group adopts, from
time to time, interpretations of such uncertain areas that reduce the overall tax rate of the Group.
While management currently estimates that it is probable that the tax positions and interpretations
that it has taken will be sustained, there is a possible risk that an outflow of resources will be required
should such tax positions and interpretations be challenged by the tax authorities. The impact of any
such challenge cannot be reliably estimated; however, it may be significant to the financial position
and/or the overall operations of the Group.
Impact of COVID 19
The 2021 was marked by a global recovery of business activity on the back of the normalization of the
pandemic situation and government stimulus measures globally. At the same time, the Russian
economy also showed solid performance, reflecting favorable market conditions and government
measures to support the economy, which ultimately had a positive effect on steel demand. MMK Group
has a stable financial position and the lowest debt burden among global steelmakers.
The Group's management continues to closely monitor the development of the pandemic, taking active
measures to minimize respective risks to employees and to the business as a whole that proved being
effective for the last two years.
While the Group has not experienced a significant negative impact of COVID-19 in 2021, there is still
an uncertainty associated with future pandemic developments. The potential impact of such
uncertainty cannot be reliably estimated; however, it may be significant to the financial position and/or
the overall operations of the Group.

MMK INTEGRATED ANNUAL REPORT
197
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
31. Fair value of financial instruments
The estimated fair values of certain financial instruments have been determined using available market
information or other valuation methodologies that require considerable judgment in interpreting
market data and developing estimates. Accordingly, the estimates applied are not necessarily
indicative of the amounts that the Group could realise in a current market exchange. The use of
different assumptions and estimation methodologies may have a material impact on the estimated fair
values.
Where it was available, management of the Group determined fair value of unlisted shares using a
valuation technique that was supported by publicly available market information.
The carrying amounts of financial instruments such as cash (Level 1) and cash equivalents (Level 2),
bank deposits, trade and other receivables, lease obligations, short-term and long-term borrowings
(except for listed bonds), trade and other payables (Level 3 of fair value hierarchy) are reasonable
approximation of their fair values as at 31 December
2021 and 31 December
2020. Fair value of the financial assets carried at amortized cost is valued at the net present value of
estimated future cash flows. The Group also considers liquidity, credit and market risk factors, and
adjusts the valuation model as deemed necessary.
The fair value of floating rate instruments is normally approximation of their carrying amount. The
estimated fair value of fixed interest rate instruments is based on estimated future cash flows expected
to be received discounted at current interest rates for new instruments with similar credit risks and
remaining maturities. Discount rates used depend on the credit risk of the counterparty.
The fair value of eurobonds is determined on the basis of market value and relates to level 1 of the
fair value hierarchy.
The following table presents the fair value of financial instruments carried at FVTPL and eurobonds at
the end of reporting period across the three levels of the fair value hierarchy defined in IFRS 13 Fair
Value Measurement, with the fair value of each financial instrument categorised in its entirety based
on the lowest level of input that is significant to that fair value management. The levels are defined as
follows:
Level 1 (highest level): fair values measured using quoted prices (unadjusted) in active markets for
identical financial instruments.
Level 2: fair values measured using quoted prices in active markets for similar financial instruments,
or using valuation techniques in which all significant inputs are directly or indirectly based on
observable market data.
Level 3 (lowest level): fair values measured using valuation techniques in which any significant input
is not based on observable market data.
Level 1
Level 2
Level 3
Total
31 December
2021
Unlisted equity securities
-
-
6
6
Trading debt securities
7
-
-
7
Total assets
7
-
6
13
Eurobonds
522
-
-
522
Total liabilities
522
-
-
522
31 December
2020
Unlisted equity securities
-
-
2
2
Trading debt securities
7
-
-
7
Total assets
7
-
2
9
Eurobonds
540
-
-
540
Total liabilities
540
-
-
540

MMK INTEGRATED ANNUAL REPORT
198
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
(In millions of U.S. Dollars, unless otherwise stated)
32. Events after the date of consolidated statement of financial position
In January 2022, dividends were paid in the amount of USD 375 million. The difference with the
declared amount is caused by the change in the exchange rates.
33. Approval of the consolidated financial statements
The consolidated financial statements for the year ended 31 December 2021 were approved by the
Group's management and authorised for issue on 28 February 2022.

MMK INTEGRATED ANNUAL REPORT
199
GLOSSARY
Units of measurement
CO₂e – Carbon dioxide equivalent
Gcal/t – Gigacalories per tonne
GJ/t – Gigajoules per tonne
mt – Million tonnes
mtpa – Million tonnes per annum
p.p. – Percentage points
t – Tonne (1,000 kg)
Abbreviations
AGM – Annual General Meeting
BOF – Basic oxygen furnace
BSI – British Standards Institution
CAPI – Comprehensive Air Pollution Index
CAPEX – Capital expenditure
CHPP – Combined heat and power plant
COSO ERM – The Committee of Sponsoring Organizations of the Treadway Commission,
Enterprise Risk Management
CRM – Customer Relationship Management
CRU – CRU Group is a business intelligence company focused on the global mining, metals and
fertilisers markets
CUSIP – Committee on Uniform Security Identification Procedures is an identification number
assigned to shares and used to facilitate clearing and settlement of trades
DRI – Direct-reduced iron
EAF – Electric arc furnaces
EBITDA – Earnings Before Interest, Taxes, Depreciation and Amortization
ESG – Environmental, Social and Corporate Governance
FCF – Free cash flow
FSU – Former Soviet Union
GDR – Global depositary receipts
GHG – Greenhouse gas
GmbH – Gesellschaft mit beschränkter Haftung (German)
GRI – Global Reporting Initiative
HBI – Hot briquetted iron
HRC – Hot rolled coil
IATF – International Automotive Task Force
IEC – International Electrotechnical Commission
I-REC – International Renewable Energy Certificate Standard
IRR – Internal Rate of Return
ISIN – International Securities Identification Number is an international share identification
code
ISO – International Organisation for Standardization
KPI – Key Performance Indicators
LLC – Limited liability company
LSE – London Stock Exchange
LTIFR – Lost Time Injury Frequency Rate
LTISR – Lost Time Injury Severity Rate
ML – Machine Learning
MOEX – Moscow Exchange
MV – Machine Vision

MMK INTEGRATED ANNUAL REPORT
200
OHS – Occupational Health & Safety
OHSAS – Occupational Health & Safety Assessment Series
OTIF – On-Time In-Full
PJSC – Public joint stock company
PLC – Production and logistics centre
R&D – Research and development
RPA – Robotic process automation
SASB – Sustainability Accounting Standards Board
SMEs – Small and medium enterprises
SOC – Security Operations Center
SRM – Supplier Relationship Management
TCFD – Task Force on Climate-related Financial Disclosures
TSR – Total Shareholder Return
UN SDGs – UN Sustainable Development Goals
VR – Virtual Reality
WSA – World Steel Association
WWF – World Wide Fund for Nature
Industry terms
Beneficiation – crushing and separating raw materials into valuable substances or waste by any
of a variety of techniques.
Big Data – is structured and unstructured data arriving at high speed and in very large volumes.
Blast furnace – a type of metallurgical furnace used for the production of pig iron from iron ore
and ferroalloys.
CIF (Cost, Insurance and Freight) – terms of delivery, which represents the charges paid by a
seller to cover the costs, insurance, and freight of a buyer's order while the cargo is in transit.
Coal concentrate – a product resulting from the coal beneficiation process, with a high grade of
extracted mineral.
Crude steel – steel in its solidified state directly after casting. This is then further processed by
rolling or other treatments, which can change its properties.
Data science – the domain of study that deals with vast volumes of data using modern tools
and techniques to find unseen patterns, derive meaningful information, and make business decisions.
Data science uses complex machine learning algorithms to build predictive models.
Fat coal (grade) – grade of coking coal with a volatile content of 30-50%.
FOB (Free on Board) –terms of delivery, which represents the seller clears the goods for export
and ensures they are delivered to and loaded onto the vessel for transport at the named port of
departure. The buyer takes over risk and costs, including import clearance and duties, as soon as the
goods are loaded onto the transport vessel at the port of departure.
Internal rate of return (IRR) – the interest rate at which the net present value of all the cash
flows (both positive and negative) from a project or investment equal zero, it is used to evaluate the
attractiveness of a project or investment.
Iron ore – chemical compounds of iron with other elements. Only extremely pure (rich) iron-
oxygen compounds are used for steelmaking.
Lean iron ore – iron ore, which has an iron content from 20% to 44%.
Long products – includes bars, rods and structural products that are ‘long’ rather than ‘flat’.
Mill – a complex of equipment in which the metal is reshaped with the required geometric
parameters.
Ore mined – ore extracted from the ground for further processing.
Pellet – an enriched form of iron ore shaped into small balls or pellets. Pellets are used as raw
material in the steel making process.
Pig iron – an intermediate product of the metallurgy in the production of steel which is obtained
by smelting iron ore and pellets in a blast furnace.

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Rebar – a steel bar or mesh of steel wires used as a tension device in reinforced concrete and
reinforced masonry structures to strengthen and aid the concrete under tension.
Rich iron ore – iron ore, which has an iron content of more than 44%.
Sinter – sinter plants agglomerate iron ore fines (dust) with other fine materials at high
temperature, to create a product that can be used in a blast furnace. The final product, a sinter, is a
small, irregular nodule of iron mixed with small amounts of other minerals. The process, called
sintering, causes the constituent materials to fuse to make a single porous mass with little change in
the chemical properties of the ingredients.
Steel-making charge(s) – the major charge materials of BOF or EAF steelmaking are scrap, pig
iron, iron ore, pellets and others.
Synthesis gas (syngas) — a gas mixture of predominantly CO and H
2
.
ZH grade coal – grade of coking coal which is mainly used in the coke production process.

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202
CONTACTS
Investor relations
Veronika Kryachko
Head of IR
Tel: +7 (915) 380 62 66
E-mail: ir@mmk.ru
MMK Legal Address
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Federation, 455000
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Dmitry Kuchumov
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ESG
Yaroslava Vrubel
Head of ESG
Tel: +7 (982) 282 96 82
E-mail: vrubel.ys@mmk.ru
MMK representative office in
Moscow
LLC MAGSTORN
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119180
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Fax: +7 (499) 238 13 33
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Fax: +7 (3519) 24 85 54
E-mail: press@mmk.ru
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Tel: +7 (3519) 24 38 22
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Citibank N.A.
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Director of Issuer Services
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JSC STATUS
Ring Park Business Centre, 23
Novokhokhlovskaya Street,
Building 1, Moscow, 109052,
Russian Federation
Tel: +7 (495) 280 04 87
E-mail: office@rostatus.ru
Magnitogorsk Branch of JSC
STATUS:
212 Karla Marksa Avenue,
455008, Magnitogorsk, Russian
Federation
Tel.: +7 (3519) 25 60 22/25 60 23