INTERNATIONAL ACCOUNTING STANDARD No. 34 CONSOLIDATED CONDENSED INTERIM (THREE MONTHS) FINANCIAL INFORMATION AND REVIEW REPORT

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1 EUROCHEM GROUP INTERNATIONAL ACCOUNTING STANDARD No. 34 CONSOLIDATED CONDENSED INTERIM (THREE MONTHS) FINANCIAL INFORMATION AND REVIEW REPORT 31 MARCH

2 Contents Auditor s Report on the Review of the Consolidated Condensed Interim Financial Information as of and Consolidated Interim Statement of Financial Position as at 31 March... 1 Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income... 2 Consolidated Interim Statement of Cash Flows... 3 Consolidated Interim Statement of Changes in Equity The EuroСhem Group and its operations Basis of preparation and significant accounting policies Adoption of new or revised standards and interpretations Fair value of financial instruments Segment information Property, plant and equipment Investment in associate and joint ventures Inventories Trade receivables, prepayments, other receivables and other current assets Originated loans Cash and cash equivalents, fixed-term deposits and restricted cash Bank borrowings and other loans received Project finance Bonds issued Derivative financial assets and liabilities Sales Cost of sales Distribution costs General and administrative expenses Other operating income and expenses Other financial gain and loss Income tax Earnings per share Balances and transactions with related parties Business combinations Contingencies, commitments and operating risks... 23

3 EuroChem Group AG Zug Review Report to the Board of Directors on the consolidated condensed interim financial information as of and for the three months period ended 31 March

4 Report on the Review of consolidated condensed interim financial information to the Board of Directors of EuroChem Group AG Zug Introduction We have reviewed the accompanying consolidated condensed interim financial information (statement of financial position, statement of profit or loss and other comprehensive income, statement of cash flows, statement of changes in equity and notes) of EuroChem Group AG as of and for the three months period ended 31 March. The Board of Directors is responsible for the preparation and presentation of this consolidated condensed interim financial information in accordance with International Accounting Standard 34 Interim Financial Reporting. Our responsibility is to express a conclusion on this consolidated condensed interim financial information based on our review. Scope of Review We conducted our review in accordance with International Standard on Review Engagements 2410, Review of interim financial information performed by the independent auditor of the entity. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. Conclusion Based on our review, nothing has come to our attention that causes us to believe that the accompanying consolidated condensed interim financial information as of and for the three months period ended 31 March have not been prepared, in all material respects, in accordance with International Accounting Standard 34 Interim Financial Reporting. PricewaterhouseCoopers AG Joanne Burgener Audit expert Auditor in charge Anna Modenkova Zug, 16 May Enclosure: Consolidated condensed interim financial information (statement of financial position, statement of profit or loss and other comprehensive income, statement of cash flows, statement of changes in equity and notes) as of and for the 3 months period ended 31 March. PricewaterhouseCoopers AG, Grafenauweg 8, Postfach, CH-6302 Zug, Switzerland Telefon: , Telefax: , PricewaterhouseCoopers AG is a member of the global PricewaterhouseCoopers network of firms, each of which is a separate and independent legal entity.

5 Consolidated Interim Statement of Financial Position as at 31 March ASSETS Note 31 March Non-current assets: Property, plant and equipment 6 5,933,099 5,297,313 Mineral rights 489, ,488 Goodwill 481, ,223 Intangible assets 161, ,625 Investment in associate and joint ventures 7 34,490 36,500 Originated loans 10 53,178 53,178 Restricted cash 11 20,329 18,170 Deferred income tax assets 90, ,464 Other non-current assets 97,466 83,690 Total non-current assets 7,360,992 6,697,651 Current assets: Inventories 8 689, ,754 Trade receivables 9 396, ,786 Prepayments, other receivables and other current assets 9 255, ,185 Income tax receivable 34,541 32,133 Originated loans Derivative financial assets ,602 Restricted cash 11 38,500 45,994 Fixed-term deposits Cash and cash equivalents , ,605 Total current assets 1,828,652 1,639,765 TOTAL ASSETS 9,189,644 8,337,416 LIABILITIES AND EQUITY Equity attributable to owners of the parent: Share capital Cumulative currency translation differences (1,328,017) (1,749,745) Retained earnings and other reserves 5,174,183 4,966,855 3,846,277 3,217,221 Non-controlling interests 1,414 1,371 Total equity 3,847,691 3,218,592 Non-current liabilities: Bank borrowings and other loans received 12 1,436,707 1,305,671 Project finance , ,022 Bonds issued , ,848 Derivative financial liabilities 15 60,112 75,209 Deferred income tax liabilities 234, ,290 Other non-current liabilities and deferred income 177, ,456 Total non-current liabilities 3,473,585 3,159,496 Current liabilities: Bank borrowings and other loans received ,499 1,075,418 Bonds issued , ,856 Derivative financial liabilities 15 1, Trade payables 365, ,549 Other accounts payable and accrued expenses 259, ,396 Income tax payable 38,911 18,912 Other taxes payable 35,117 34,494 Total current liabilities 1,868,368 1,959,328 Total liabilities 5,341,953 5,118,824 TOTAL LIABILITIES AND EQUITY 9,189,644 8,337,416 The accompanying notes on pages 5 to 25 are an integral part of this consolidated condensed interim financial information. 1

6 Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income Note 31 March 31 March Sales 16 1,336,463 1,255,292 Cost of sales 17 (807,074) (738,216) Gross profit 529, ,076 Distribution costs 18 (180,563) (141,382) General and administrative expenses 19 (50,725) (37,238) Other operating income/(expenses), net 20 (18,760) 5,982 Operating profit 279, ,438 Share of profit/(loss) from associate and joint ventures, net 7 (995) 7,850 Interest income 3,478 3,782 Interest expense (33,142) (31,467) Financial foreign exchange gain/(loss), net 50,185 46,292 Other financial gain/(loss), net 21 11,184 25,800 Profit before taxation 310, ,695 Income tax expense 22 (102,790) (75,447) Net profit 207, ,248 Other comprehensive income/(loss) that may be reclassified to profit or loss in subsequent periods Currency translation differences 423, ,280 Share of currency translation differences of associate and joint ventures, net 7 (1,564) - Total other comprehensive income that may be reclassified to profit or loss in subsequent periods 421, ,280 Total comprehensive income 629, ,528 Profit/(loss) attributable to: Owners of the parent 207, ,305 Non-controlling interests (67) (57) 207, ,248 Total comprehensive income/(loss) attributable to: Owners of the parent 629, ,599 Non-controlling interests 43 (71) 629, ,528 Earnings per share basic and diluted The accompanying notes on pages 5 to 25 are an integral part of this consolidated condensed interim financial information. 2

7 Consolidated Interim Statement of Cash Flows Note 31 March 31 March Operating profit 279, ,438 Income tax paid (43,906) (30,844) Operating profit less income tax paid 235, ,594 Depreciation and amortisation 19 66,840 48,425 Net (gain)/loss on disposals, impairment and write-off of property, plant and equipment, net (290) 1,491 Change in provision for impairment of receivables and provision for obsolete and damaged inventories, net 14,559 (2,077) Other non-cash (income)/expenses, net 44,351 5,805 Gross cash flow 360, ,238 Changes in operating assets and liabilities: Trade receivables (126,458) (122,666) Advances to suppliers 5,115 27,101 Other receivables 14,482 (4,735) Inventories 19,588 14,071 Trade payables 65,178 33,122 Advances from customers 8,857 (25,212) Other payables (16,765) (5,516) Restricted cash 6,643 (10,098) Net cash operating activities 337, ,305 Cash flows from investing activities Capital expenditure on property, plant and equipment and intangible assets (273,369) (224,093) Other payment related to mineral rights (950) (63) Investment in associate 7 - (10,403) Proceeds from sale of interest in associate 24 60,749 - Acquisition of subsidiaries, net of cash (77) - Proceeds from sale of property, plant and equipment Net change in fixed-term deposits (7) 4,030 Originated loans 10 (173) (22,750) Interest received 3,264 2,176 Other investing activities (5,188) - Net cash investing activities (215,576) (251,064) Free cash inflow 121,959 22,241 Cash flows from financing activities Proceeds from bank borrowings and other loans received , ,637 Funds received under the Project Finance Facilities ,000 83,749 Repayment of bank borrowings and other loans 12 (617,617) (584,546) Prepaid and additional transaction costs (329) (830) Prepaid and additional transaction costs related to Project Finance Facilities (3,136) (13,600) Return of collateral provided to banks to secure derivative transactions - 3,100 Interest paid (32,340) (27,581) Cash proceeds/(payments) on derivatives, net 15 1,933 (29,376) Net cash financing activities 2,413 (31,447) Effect of exchange rate changes on cash and cash equivalents 3,591 10,398 Net increase in cash and cash equivalents 127,963 1,192 Cash and cash equivalents at the beginning of the period , ,669 Cash and cash equivalents at the end of the period , ,861 The accompanying notes on pages 5 to 25 are an integral part of this consolidated condensed interim financial information. 3

8 Consolidated Interim Statement of Changes in Equity Attributable to owners of the parent Cumulative Retained currency earnings Share translation and other capital differences reserves Total Noncontrolling interests Total equity Balance at 1 January 111 (2,404,581) 4,009,496 1,605, ,605,920 Comprehensive income/(loss) Net profit/(loss) , ,305 (57) 321,248 Other comprehensive income/(loss) Currency translation differences - 282, ,294 (14) 282,280 Total other comprehensive income/(loss) - 282, ,294 (14) 282,280 Total comprehensive income/(loss) - 282, , ,599 (71) 603,528 Balance at 31 March 111 (2,122,287) 4,330,801 2,208, ,209,448 Balance at 1 January 111 (1,749,745) 4,966,855 3,217,221 1,371 3,218,592 Comprehensive income/(loss) Net profit/(loss) , ,328 (67) 207,261 Other comprehensive income/(loss) Currency translation differences - 423, , ,402 Share of currency translation differences of associate and joint ventures - (1,564) - (1,564) - (1,564) Total other comprehensive income - 421, , ,838 Total comprehensive income - 421, , , ,099 Balance at 31 March 111 (1,328,017) 5,174,183 3,846,277 1,414 3,847,691 The accompanying notes on pages 5 to 25 are an integral part of this consolidated condensed interim financial information. 4

9 1 The EuroСhem Group and its operations The EuroСhem Group comprises the parent entity, EuroСhem Group AG (the Company ) and its subsidiaries (collectively the Group or EuroChem Group ). The Company was incorporated under the laws of Switzerland on 16 July 2014 and has its registered office at: Baarerstrasse, 37, 6300, Zug, Switzerland. As at 31 March, AIM Capital SE owned 90% ( : 90%) of the share capital of EuroСhem Group AG, the remaining 10% of the Company were held indirectly by Mr. Dmitry Strezhnev ( : 10%). A company that holds business interests beneficially for Mr. Andrey Melnichenko owned 100% of Linea Ltd. registered in Bermuda, which in its turn indirectly owns 100% of AIM Capital SE ( : 100%). The Group s principal activity is the production of mineral fertilizers (nitrogen- and phosphate-based) as well as mineral extraction (apatite, phosphate rock, iron-ore, baddeleyite and hydrocarbons), and the operation of a distribution network. The Group is developing potassium salts deposits to start the production and marketing of potassium fertilizers. The Group s main production facilities are located in Russia, Lithuania, Belgium, Kazakhstan and China (the Group s joint venture s production facilities). The Group s distribution assets are located globally across Europe, Russia, North, Central and South America, Central and South East Asia. 2 Basis of preparation and significant accounting policies Basis of preparation. This consolidated condensed interim financial information for the three months ended 31 March has been prepared in accordance with IAS 34, Interim Financial Reporting ; it supplements the annual consolidated financial statements for the year ended prepared in accordance with International Financial Reporting Standards. The principal accounting policies and significant judgments and estimates applied therein are consistent with those of the consolidated financial statements for the year ended. At 31 March, the official exchange rates were: US$ 1 = RUB , US$ 1 = EUR ( : US$ 1 = RUB , US$ 1 = EUR ). Average rates for the three months ended 31 March were: US$ 1 = RUB , US$ 1 = EUR (three months ended 31 March : US$ 1 = RUB , US$ 1 = EUR ). Changes in presentation. Starting 1 January the Group changed its treatment of foreign exchange revaluation of cash and cash equivalents to financial foreign exchange gain/loss (previously: foreign exchange gains/losses from operating activity ). This was done due to the centralisation of management of cash and cash equivalents by the Group Treasury regardless of jurisdiction or legal entity in the course of. The presentation of divisional sales (Note 5) was changed by the grossing up of certain intra-group revenues which were previously presented on the net basis. The comparative figures are presented and reallocated respectively to reflect these changes. 3 Adoption of new or revised standards and interpretations The following amendments and improvements to standards became effective from 1 January : Amendments to IAS 12, Recognition of Deferred Tax Assets for Unrealised Losses; Annual Improvements to IFRSs 2014-; Amendments to IAS 7, Disclosure Initiative. These amendments and improvements to standards did not have any impact or did not have a material impact on the Group s consolidated condensed interim financial information. 5

10 3 Adoption of new or revised standards and interpretations (continued) A number of new standards, amendments to standards and interpretations are not yet effective as at 31 March, and have not been early adopted by the Group: IFRS 9, Financial Instruments. The Group is currently assessing the impact of the standard on its consolidated financial statements; IFRS 15, Revenue from Contracts with Customers and associated amendments to various other standards, Revenue from Contracts with Customers. The Group is currently assessing the impact of the standard on its consolidated financial statements; Amendments to IFRS 10 and IAS 28 regarding the sale or contribution of assets between an investor and its associate or joint venture; IFRS 16, Leases. The Group is currently assessing the impact of the standard on its consolidated financial statements; Amendments to IFRS 2, Share-based Payment; Amendments to IFRS 4, Applying IFRS 9 Financial instruments with IFRS 4, Insurance contracts; IFRIC 22, Foreign Currency Transactions and Advance Consideration; Amendments to IAS 40, Transfers of Investment property. Unless otherwise described above, the new standards, amendments to standards and interpretations are expected to have no impact or to have a non-material impact on the Group s consolidated condensed interim financial information. 4 Fair value of financial instruments Fair value is the amount at which a financial instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation, and is best evidenced by an active quoted market price. The estimated fair value of financial instruments has been determined by the Group using available market information, where it exists, and appropriate valuation methodologies. However, judgement is necessarily required to interpret market data to determine the estimated fair value. Financial instruments carried at fair value. The fair values of derivative financial instruments carried at fair value through profit or loss, which typically include foreign exchange forward contracts, cross currency interest rate swaps, commodity swaps etc., are based on recurring mark-to-market valuations provided by the financial institutions which deal in these financial instruments. The fair value of derivative financial assets and liabilities were included in level 2 of the fair value hierarchy. Financial assets carried at amortised cost. The fair value of floating rate instruments is normally 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 risk and remaining maturity. The discount rates used depend on the credit risk of the counterparty. The carrying amounts of trade and other receivables and originated loans approximate their fair values and are included in level 3 of fair value hierarchy. Cash and cash equivalents and fixed-terms deposits are carried at amortised cost which approximates their current fair value, included in Level 2 of fair value hierarchy. The fair values in level 2 and level 3 of the fair value hierarchy were estimated using the discounted cash flows valuation technique. Financial liabilities carried at amortised cost. The fair value of floating rate instruments is normally their carrying amount. The fair value is based on quoted market prices, if available. The estimated fair values of fixed interest rate instruments with a stated maturity, for which quoted market prices were not available, were estimated based on expected cash flows discounted at current interest rates for new instruments with similar credit risks and remaining maturities. The fair value of liabilities repayable on demand or after a notice period ( demandable liabilities ) is estimated as the amount payable on demand, discounted from the first date that the amount could be required to be paid. 6

11 4 Fair value of financial instruments (continued) The fair value of loans and borrowings, project finance and issued bonds at 31 March and are disclosed in Notes 12, 13 and 14. The fair values of other financial liabilities carried at amortised cost approximate their carrying values. The fair values of all liabilities carried at amortised costs were included in level 3 with exception of issued bonds which were included in level 1 of the fair value hierarchy. During the three months ended 31 March and 31 March there were no transfers between levels 1, 2 and 3 in the fair value hierarchy. The Group s financial assets and liabilities were as follows: Financial assets 31 March Non-current financial assets Restricted cash 20,329 18,170 Originated loans 53,178 53,178 Other non-current assets including: Long-term other receivables Interest receivable 3,104 2,645 Total non-current financial assets 77,127 74,509 Current financial assets Restricted cash 38,500 45,994 Trade receivables 396, ,786 Originated loans Derivative financial assets 44 13,602 Other receivables and other current assets including: Other receivables 2,355 4,532 Collateral held by banks to secure derivative transactions Interest receivable Fixed-term deposits Cash and cash equivalents 413, ,605 Total current financial assets 852, ,318 Total financial assets 929, ,827 Financial liabilities Non-current financial liabilities Bank borrowings and other loans received 1,436,707 1,305,671 Bonds issued 849, ,848 Project finance 714, ,022 Derivative financial liabilities 60,112 75,209 Other non-current liabilities including: Contingent liability related to acquisition of Fertilizantes Tocantins Ltda 115, ,655 Long-term portion of deferred payable related to mineral rights acquisition 13,101 13,448 Total non-current financial liabilities 3,189,810 2,898,853 Current financial liabilities Bank borrowings and other loans received 844,499 1,075,418 Bonds issued 324, ,856 Derivative financial liabilities 1, Trade payables 365, ,549 Other accounts payable and accrued expenses including: Other accounts payable 6,108 - Interest payable 33,388 18,002 Short-term portion of deferred payables related to business combinations 8,529 8,344 Short-term portion of deferred payable related to mineral rights acquisition 1,843 1,262 Total current financial liabilities 1,585,208 1,712,134 Total financial liabilities 4,775,018 4,610,987 7

12 5 Segment information The Group has a vertically integrated business model conducted by five operating divisions, representing reportable segments, which are Mining, Oil & Gas, Fertilizers, Logistics and Sales: Mining division encompasses the extraction of ores to obtain apatite, baddeleyite and iron-ore concentrates, phosphorite; as well as the development of potassium salts deposits (potash); Oil & Gas division represents the exploration and production of natural gas and gas condensate, as well as the development of hydrocarbon deposits; Fertilizers division includes the production of mineral fertilizers (nitrogen, phosphate and complex) and organic synthesis products; Logistics division covers all supply chain operations including transportation services, the purchase and delivery of raw materials and finished goods, as well as freight forwarding and other logistics services; Sales division is responsible for the sale of the complete range of products produced by the Group as well as third-party products through the Group s global distribution network spanning across Europe, Russia, North, Central and South America, Central and South East Asia. Activities not assigned to a particular division are reported in Other. These include certain service activities, central management and other items. Аll intersegment transactions and unrealised profit in inventory from intragroup sales are eliminated through Elimination. The review of financial reports of the Group, evaluation of the operating results and allocation of resources between the operating divisions are performed by the Management Board (considered to be the chief operating decision maker in the Group). The development and approval of strategies, market and risk analysis, investment focus, technological process changes are undertaken mostly in accordance with the operating divisions. Budgets and financial reports are prepared in a standard format according to the IFRS accounting policy adopted by the Group. Sales between divisions are carried out on an arm s length basis. The Management Board assesses the performance of the operating divisions based on, among other factors, a measure of EBITDA (profit before taxation adjusted by interest expense, depreciation and amortisation, financial foreign exchange gain or loss, other non-cash and one-off items, excluding net profit for the period attributed to non-controlling interests). EBITDA of each division is analytically adjusted according to internal rules based on the Divisional economic model and responsibility areas. Since the EBITDA term is not a standard IFRS measure, EuroChem Group s definition of EBITDA may differ from that of other companies. The division results were: External sales Internal sales Total sales EBITDA Mining 2, , , ,087 Oil&Gas 8,115 13,189 21,304 3,631 Fertilizers 13, , , ,146 Logistics 11,115 45,778 56,893 23,606 Sales 1,299,323 3,560 1,302,883 44,759 Other 1,170 17,375 18,545 (15,381) Elimination - (984,691) (984,691) 9,401 Total 1,336,463-1,336, ,249 8

13 5 Segment information (continued) The division results for the three months ended 31 March were: External sales Internal sales Total sales EBITDA Mining 3, , ,591 62,310 Oil&Gas 4,868 11,415 16,283 4,303 Fertilizers 13, , , ,223 Logistics 10,083 36,851 46,934 17,157 Sales 1,215,392 1,833 1,217,225 23,683 Other 7,948 4,502 12,450 6,679 Elimination - (955,049) (955,049) 59,473 Total 1,255,292-1,255, ,828 A reconciliation of EBITDA to profit before taxation is provided below: Note 31 March 31 March EBITDA 349, ,828 Depreciation and amortisation 19 (66,840) (48,425) (Provision)/reversal of provision for impairment and write-off of idle property, plant and equipment 6, 17, (823) Non-recurring income/(expenses), net 20 (1,212) 2,547 Interest expense (33,142) (31,467) Financial foreign exchange gain/(loss), net 50,185 46,292 Other financial gain/(loss), net 21 11,184 25,800 Non-controlling interests (67) (57) Profit before taxation 310, ,695 The main Group s manufacturing facilities are based in Russia, Lithuania, Belgium, Kazakhstan and China (the Group s joint venture s production facilities). The analysis of Group sales by region was: 31 March 31 March Europe 445, ,448 Russia 258, ,167 North America 189, ,740 Latin America 163,407 53,554 Asia Pacific 161, ,732 CIS 84,468 87,971 Africa 34,326 23,680 Total sales 1,336,463 1,255,292 The sales are allocated to regions based on the destination country. During the three months ended 31 March, the Group had sales in excess of 10% to Russia and the United States of America, representing 19.3% and 13.5% of total Group revenues, respectively (three months ended 31 March sales to Russia and the United States of America representing 16.1% and 20.1% of total Group revenues, respectively). During the three months ended 31 March and 31 March, there were no sales in excess of 10% to one customer. 9

14 6 Property, plant and equipment Movements in the carrying amount of property, plant and equipment were: Note Carrying amount at 1 January 5,297,313 3,365,865 Including advances given to construction companies and suppliers of property, plant and equipment 549, ,790 Additions 309, ,710 Including changes in advances given (21,378) 71,929 Additions through business combination 1,322 - Disposals (579) (707) Depreciation charge for the period (66,494) (46,246) (Provision)/reversal of provision for impairment and write-off of idle property, plant and equipment 17, (823) Currency translation differences 391, ,568 Carrying amount at 31 March 5,933,099 3,820,367 Including advances given to construction companies and suppliers of property, plant and equipment 570, ,087 Borrowing costs capitalised During the three months ended 31 March, borrowing costs totalling US$ 19,108 thousand were capitalised in property, plant and equipment at an average interest rate of 4.58% p.a. (three months ended 31 March : US$ 10,354 thousand capitalised at an average interest rate of 4.06% p.a.). Payables to suppliers of property, plant and equipment and construction companies As at 31 March, trade payables included payables to suppliers of property, plant and equipment and construction companies amounting to US$ 72,574 thousand ( : US$ 66,099 thousand). 7 Investment in associate and joint ventures The Group s investments in associate and joint ventures were as follows: 31 March Investment in joint venture EuroChem-Migao Ltd. 18,711 20,517 Investment in joint venture LLC Thyssen Schachtbau EuroChem Drilling 7,663 7,358 Investment in associate Agrinos AS 8,116 8,625 Total investments in associate and joint ventures 34,490 36,500 Movements in the carrying amount of the Group s investments in associate and joint ventures were: Carrying amount at 1 January 36, ,755 Acquisition of interest in associate Agrinos AS - 10,403 Share of profit/(loss) from associate and joint ventures, net (995) 7,850 Share of other comprehensive income/(loss) from associate and joint ventures, net (1,564) - Currency translation difference 549 7,195 Carrying amount at 31 March 34, ,203 10

15 7 Investment in associate and joint ventures (continued) Investment in joint venture EuroChem-Migao Ltd. The aggregated assets, liabilities of joint venture were as follows: 31 March Current assets 34,047 38,179 Non-current assets 29,723 32,176 Current liabilities (27,193) (29,063) Non-current liabilities (161) (259) Net assets 36,416 41,033 The joint venture s revenues and results were as follows: 31 March 31 March Sales 8, Net loss (195) (561) Investment in joint venture LLC Thyssen Schachtbau EuroChem Drilling The aggregated assets, liabilities of joint venture were as follows: 31 March Current assets 8,491 7,947 Non-current assets 9,539 9,299 Current liabilities (529) (475) Non-current liabilities (473) (421) Net assets 17,028 16,350 The joint venture s revenue and result were as follows: 31 March 31 March Sales 1, Net loss (470) (83) Investment in associate Agrinos AS The aggregated assets, liabilities were presented as at being the most recent available financial statements of the associate and were as follows: Current assets 12,429 Non-current assets 9,963 Current liabilities (9,202) Non-current liabilities (1,495) Non-controlling interest 1,142 Net assets 12,837 The associate s revenues and results were presented for the three months ended being the most recent available financial statements of the associate and were as follows: Sales 2,701 Net loss (1,665) 11

16 8 Inventories 31 March Finished goods 357, ,534 Materials 203, ,535 Catalysts 75,149 72,007 Work in progress 62,516 57,257 Less: provision for obsolete and damaged inventories (8,955) (8,579) Total inventories 689, ,754 9 Trade receivables, prepayments, other receivables and other current assets 31 March Trade receivables Trade receivables denominated in US$ 195, ,323 Trade receivables denominated in EUR 123,261 78,914 Trade receivables denominated in RUB 58,495 29,804 Trade receivables denominated in other currencies 38,340 24,174 Less: impairment provision (19,941) (5,429) Total trade receivables 396, ,786 Prepayments, other receivables and other current assets Advances to suppliers 78,740 79,432 VAT recoverable and receivable 156, ,210 Other taxes receivable 6,555 7,145 Other receivables and other current assets 21,183 23,215 Receivable due to sale of associate (Note 24) - 59,760 Collateral held by banks to secure derivative transactions Interest receivable Less: impairment provision (8,265) (7,670) Total prepayments, other receivables and other current assets 255, ,185 Total trade receivables, prepayments, other receivables and other current assets 651, , Originated loans Note Interest rate * Interest rate * 31 March Non-current originated loans Unsecured US$-denominated loan to related party which is an entity under common control with the Group %-3.8% 3.2%-3.8% 53,178 53,178 Total non-current originated loans 53,178 53,178 Current originated loans Unsecured RUB denominated loan to 3-rd party 12.0%-13.4% 13.4% Total current originated loans Total originated loans 53,798 53,590 * Contractual interest rate as at 31 March and, respectively. 12

17 10 Originated loans (continued) Movements in Group s originated loans were as follows: Note Balance as at 1 January 53, ,818 Originated loans to parent company 24-22,750 Originated loan to 3-rd party Foreign exchange gain/(loss), net (3,892) (4,104) Currency translation differences 3,927 4,104 Balance as at 31 March 53, , Cash and cash equivalents, fixed-term deposits and restricted cash 31 March Cash on hand* Bank balances denominated in US$ 168,394 79,126 Bank balances denominated in RUB 61,286 37,519 Bank balances denominated in EUR 67,831 67,083 Bank balances denominated in other currencies 22,066 10,999 Term deposits denominated in US$ 2,982 14,050 Term deposits denominated in RUB 72,158 51,588 Term deposits denominated in other currencies 18,744 25,175 Total cash and cash equivalents 413, ,605 Fixed-term deposits in different currencies Total fixed-term deposits Current restricted cash 38,500 45,994 Non-current restricted cash 20,329 18,170 Total restricted cash 58,829 64,164 * Includes cash on hand denominated in different currencies. Term deposits at 31 March and are held to meet short term cash needs and have various original maturities but can be withdrawn on request without any restrictions. Fixed-term deposits have various original maturities and can be withdrawn with an early notification and/or with a penalty accrued or interest income forfeited. At 31 March, non-current restricted cash consisted of US$ 17,902 thousand ( : US$ 15,802 thousand) held in a debt service reserve account as required by the Usolsky Project Finance Facility Agreement (Note 13) and US$ 2,427 thousand ( : US$ 2,368 thousand) held in bank accounts as security deposits for third parties. At 31 March, current restricted cash consisted of US$ 26,802 thousand ( : US$ 30,358 thousand) held at bank as required by pre-export finance club facility (Note 12) and US$ 11,698 thousand ( : US$ 15,636 thousand) held at banks as a guarantee for import transactions to comply with Ukrainian legislation. 13

18 12 Bank borrowings and other loans received Interest rate Currency and rate * Interest rate * 31 March Current loans and borrowings Short-term unsecured bank loans US$ with floating rate 2.77%-5.20% 2.26%-3.52% 373, ,000 US$ with fixed rate 2.55%-5.95% 2.55%-5.95% 55,812 55,738 BRL with floating rate 25.01% 20.70%-26.58% 1,201 1,486 BRL with fixed rate 10.51% 10.51% Short-term secured bank loans US$ with fixed rate 5.20% 5.20% 12,578 12,417 BRL with fixed rate 2.50%-8.70% 2.50%-8.70% Current portion of unsecured long-term bank loans US$ with floating rate 2.91% 2.75% 400, ,000 BRL with floating rate 24.09% 21.36% BRL with fixed rate 15.50% 15.50% Current portion of secured long-term bank loans BRL with floating rate 10.65% 10.65% BRL with fixed rate 2.94%-12.17% 3.00%-12.17% 2,574 2,108 Less: short-term portion of transaction costs (2,429) (2,508) Total current loans and borrowings 844,499 1,075,418 Currency and rate Interest rate * Interest rate * 31 March Non-current loans and borrowings Long-term unsecured bank loans US$ with floating rate 2.98%-3.78% 3.56% 430, ,000 BRL with fixed rate 15.50% 15.50% 943 1,065 Long-term secured bank loan US$ with floating rate 3.73% 3.51% 800, ,000 Long-term portion of unsecured bank loans US$ with floating rate 2.91% 2.75% 200, ,000 BRL with floating rate 24.09% 21.36% Long-term portion of secured bank loans BRL with floating rate 10.65% 10.65% BRL with fixed rate 2.94%-12.17% 3.0%-12.17% 17,745 17,708 Less: long-term portion of transaction costs (12,212) (13,406) Total non-current loans and borrowings 1,436,707 1,305,671 Total loans and borrowings 2,281,206 2,381,089 * Contractual interest rate on 31 March and, respectively. Movements in the Group s bank borrowings and other loans received were as follows: Currency Balance as at 1 January 2,381,089 2,685,412 Bank loans received US$ 508, ,000 Bank loans received RUB - 89,558 Bank loans received UAH - 3,079 Bank loan acquired in a business combination EUR 6,555 - Bank loans repaid US$ (610,000) (545,000) Bank loan repaid EUR (6,555) - Bank loans repaid RUB - (36,531) Bank loans repaid UAH - (3,015) Bank loans repaid BRL (1,062) - Capitalisation and amortisation of transaction costs, net 1,242 1,529 Foreign exchange (gain)/loss, net (501) 22,352 Currency translation differences, net 1,536 6,759 Balance as at 31 March 2,281,206 2,669,143 * UAH Ukraine Hryvnia; * BRL Brazilian Real. 14

19 12 Bank borrowings and other loans received (continued) The Group s bank borrowings and other loans received mature: 31 March - within 1 year 844,499 1,075,418 - between 1 and 2 years 328, ,734 - between 2 and 5 years 1,100, ,624 - more than 5 years 8,123 8,313 Total bank borrowings and other loans received 2,281,206 2,381,089 According to IFRS 7, Financial Instruments: Disclosures, an entity shall disclose the fair value of financial liabilities. The fair value of short-term bank borrowings and borrowings bearing floating interest rates is not materially different from their carrying amounts. The fair value of the long-term borrowings bearing a fixed interest rate is estimated based on expected cash flows discounted at a prevailing market interest rate. As at 31 March the fair value of long-term loans with fixed interest rates was less than their carrying amount by US$ 295 thousand ( : the fair value of long-term loans was less than their carrying amount by US$ 740 thousand). Under the terms of the loan agreements, the Group is required to comply with a number of covenants and restrictions, including the maintenance of certain financial ratios and financial indebtedness and crossdefault provisions. The Group was in compliance with covenants at 31 March and. Interest rates and outstanding amounts of major loans and borrowings In, the Group signed a pre-export finance club facility of US$ 800 million bearing interest at 1-month Libor +2.75% and maturing in October As at 31 March, the outstanding amount was US$ 800 million ( : US$ 800 million). In, the Group signed a US$ 250 million term loan facility bearing a floating interest rate and maturing in September. As at 31 March, the outstanding amount was US$ 250 million ( : US$ 250 million). In 2014, the Group signed a US$ 100 million uncommitted revolving credit facility bearing a floating interest rate and maturing in December 2018 with credit limit increased to US$ 150 million in As at 31 March, the outstanding amount was US$ 100 million ( : US$ 150 million). In 2014, the Group signed an uncommitted revolving credit facility with a Russian bank. The funds through this facility may be obtained in multiple currencies. During the three months ended 31 March, the facility was utilised and repaid several times. As at 31 March, the outstanding amount was US$ 430 million ( : US$ 330 million). In 2013, the Group obtained a credit facility of US$ 1.3 billion bearing interest at 3-month Libor +1.8% and maturing in September As at 31 March, the outstanding amount was US$ 600 million ( : US$ 700 million). Undrawn facilities In 2015, the Group signed a US$ 100 million committed revolving credit facility bearing a floating interest rate and maturing in December. In, the Group signed a RUB 9.5 billion revolving fixed-interest rate committed credit agreement maturing in August

20 12 Bank borrowings and other loans received (continued) In, the Group signed a RUB 10 billion 1-year revolving fixed-interest rate committed credit agreement. In, the Group signed a RUB 20 billion 3-year revolving uncommitted credit agreement. As at 31 March and, the above credit facilities had no outstanding balances and are available to the Group. Collaterals and pledges The pre-export finance club facility of US$ 800 million was collateralised by future export proceeds of the Group under sales contracts with certain customers and cash balances of US$ 26,802 thousand on the bank accounts at 31 March ( : US$ 30,358 thousand) (Note 11). As at 31 March the loans of a Brazilian subsidiary totaling US$ 33,160 thousands were collaterised by property, plant and equipment with the carrying value of US$ 50,664 thousand ( : loans of US$ 32,519 were collaterised by property, plant and equipment with the carrying value of US$ 42,193 thousand). At 31 March and, all other bank borrowings and other loans received listed in Note 12 were not secured. 13 Project finance Due to non-recourse nature of the Project Finance facilities they are excluded from financial covenant calculations in accordance with the Group s various debt, project, finance, legal and other documents and are presented as a separate line Project finance in the consolidated statement of financial position. Usolsky potash project. In 2014, the Group signed a US$ 750 million Non-recourse Project Finance Facility Agreement ( Project Financing or the facility ) maturing at the end of 2022 with a floating interest rate based on 3-month Libor for financing Usolsky potash project located in the Perm region of Russia. During the three months ended 31 March, the Group received funds under the facility totaling US$ 145,000 thousand (three months ended 31 March : US$ 83,749 thousand). As at 31 March, the outstanding balance was US$ 714,610 thousand shown net of transaction costs of US$ 20,835 thousand ( : US$ 573,022 thousand shown net of transaction costs of US$ 17,423 thousand). The contractual interest rate as at 31 March was 4.65 % p.a. ( : 4.51% p.a.). The facility matures: 31 March - between 1 and 2 years 29, between 2 and 5 years 540, ,419 - more than 5 years 144, ,603 Total Project Finance 714, ,022 The fair value of this facility was not materially different from its carrying amount. In April, the Group received the final tranche of US$ 15 million and the facility is regarded as utilised. As at 31 March, in compliance with terms of the Project Finance Facility Agreement the Group held US$ 17,902 thousand on a debt service reserve account ( : US$ 15,802 thousand) (Note 11). 16

21 13 Project finance (continued) As at 31 March and, under the terms of the Project Finance Facility Agreement 100% of the shares in EuroChem Usolsky Mining S.à r.l., the project owner and wholly-owned subsidiary of the Group, were pledged as collateral. The carrying value of the assets pledged under the facility related to the project amounted to US$ 1,506,688 thousand ( : US$ 1,250,802 thousand). During the three months ended 31 March and 31 March, EBITDA of subsidiaries under the Usolsky potash project was of US$ 3,499 thousand and US$ 278 thousand, respectively, solely due to foreign exchange impact. Ammonia project in Kingisepp. In 2015, the Group signed a EUR 557 million Non-recourse 13.5-year Project Finance Facility with a floating interest rate based on 3-month Euribor to finance the construction of an ammonia plant in Kingisepp, Russia. As at 31 March the balance of the facility presented in this consolidated interim statement of financial position was nil as the funds received of US$ 70,672 thousand were shown netted off transaction costs of US$ 70,672 thousand ( : US$ 69,172 thousand were shown netted off transaction costs of US$ 69,172 thousand). The remaining portion of transaction costs of US$ 54,251 thousand were shown as Other non-current assets in the consolidated interim statement of financial position ( : US$ 49,134 thousand). The contractual interest rate as at 31 March was 1.3% p.a. ( : 1.3% p.a.) As at 31 March and, under the terms of the facility agreement 100% of the shares in EuroСhem-NorthWest, JSC, the project owner and wholly-owned subsidiary of the Group, were pledged as collateral. The carrying value of the assets pledged under the Facility related to the project amounted to US$ 637,929 thousand as at 31 March ( : US$ 590,100 thousand). During the three months ended 31 March and 31 March, EBITDA of the subsidiary under the Ammonia project was of US$ 111 thousand and US$ 204 thousand, respectively, solely due to foreign exchange impact. 14 Bonds issued Currency Rate Coupon rate, p.a. Maturity 31 March Fair Carrying Fair Carrying value amount value amount Current bonds USD Fixed 5.125% 330, , , ,033 Less: transaction cost - (31) - (177) Total current bonds issued 330, , , ,856 Non-current bonds US$ Fixed 3.80% , , , ,000 RUB Fixed 12.40% ,791 88,687 85,563 82,431 RUB Fixed 8.25% RUB Fixed 10.60% , , , ,293 Less: transaction cost - (5,398) - (5,170) Total non-current bonds issued 869, , , ,848 Total bonds issued 1,199,674 1,173,670 1,168,660 1,148,704 The fair value of the outstanding US$-denominated bonds and RUB-denominated bonds was determined with reference to their quotations on the Irish Stock Exchange and the Moscow Exchange, respectively. 17

22 15 Derivative financial assets and liabilities At 31 March, net derivative financial assets and liabilities were: Assets Noncurrent Current Liabilities Noncurrent Current Commodity swaps ,111 UAH/US$ deliverable forward contracts with a nominal amount of US$ 2 million Cross currency interest rate swaps ,112 - Total ,112 1,155 At, net derivative financial assets and liabilities were: Assets Noncurrent Current Liabilities Noncurrent Current Commodity swaps UAH/US$ deliverable forward contracts with a nominal amount of US$ 6 million RUB/US$ non-deliverable forward contracts with a nominal amount of RUB 9,000 million - 12, Cross currency interest rate swaps ,209 - Total - 13,602 75, Movements in the carrying amount of derivative financial assets/(liabilities) were: 1 January Gain/(loss) from changes of fair value, net Cash (proceeds)/ payments on derivatives, net 31 March Operating activities 12,899 9,832 (23,842) (1,111) Commodity swaps 205 (3,032) 1,760 (1,067) Foreign exchange deliverable and nondeliverable forward contracts, net 12,694 12,864 (25,602) (44) Financing activities (75,209) 17,030 (1,933) (60,112) Cross currency interest rate swaps, net (75,209) 17,030 (1,933) (60,112) Total derivative financial assets and liabilities, net (62,310) 26,862 (25,775) (61,223) Changes in the fair value of derivatives, which are entered into for the purpose of mitigating risks linked to cash flows from operating activities of the Group, are recognised in Other operating income/(expenses), net (Note 20), where foreign currency derivative contracts are recognised in Foreign exchange gain/(loss), net and commodity swaps are recognised in Other operating income/(expenses), net. Changes in the fair value of derivatives, which are entered into for the purpose of hedging the financing and investing cash flows, are recognised in Other financial gain/(loss), net (Note 21). Foreign exchange non-deliverable forward contracts In March, the Group signed RUB/US$ non-deliverable forward contract with a notional amount of RUB 3,000 million, which was terminated by the end of the month. RUB/US$ non-deliverable forward contracts with total notional amount of RUB 7,000 million were terminated in March. RUB/US$ non-deliverable forward contract with a notional amount of RUB 2,000 million matured in March. 18

23 16 Sales The external sales by product group were: Sales volume (thousand metric tonnes) 31 March 31 March Sales volume Sales (thousand (thousand US$) metric tonnes) Sales (thousand US$) Nitrogen products 2, ,213 2, ,650 Nitrogen fertilizers 2, ,561 2, ,224 Other products Phosphate and complex fertilizers 1, ,178 1, ,824 Phosphate fertilizers , ,684 Complex fertilizers , ,096 Feed phosphates 84 30, ,044 Other fertilizers 68 20, ,001 Iron ore concentrate 1, ,337 1,334 48,530 Apatite and baddeleyite concentrates - 10,186-10,434 Apatite concentrate 28 3, ,529 Baddeleyite concentrate 2 6, ,905 Industrial products - 93,462-74,026 Organic synthesis products , ,887 Other products - 24,316-18,139 Hydrocarbons 23 7, ,768 Other sales - 41,786-33,059 Logistic services - 10,684-9,933 Other products - 17,907-10,945 Other services - 13,195-12,181 Total sales - 1,336,463-1,255, Cost of sales The components of cost of sales were: 31 March 31 March Raw materials 253, ,645 Goods for resale 261, ,941 Other materials 43,979 34,627 Energy 43,458 33,873 Utilities and fuel 20,876 14,498 Labour, including contributions to social funds 60,558 56,100 Depreciation and amortisation 55,571 41,295 Repairs and maintenance 10,012 10,465 Production overheads 14,802 18,191 Property tax, rent payments for land and related taxes 12,717 7,623 Provision /(reversal of provision) for impairment and write-off of idle property, plant and equipment, net (Note 6) (694) 502 Provision/(reversal of provision) for obsolete and damaged inventories, net 406 (1,433) Changes in work in progress and finished goods 25,801 12,583 Other costs/(compensations), net 3,977 1,306 Total cost of sales 807, ,216 19

24 18 Distribution costs Distribution costs were: 31 March 31 March Transportation 128, ,544 Labour, including contributions to social funds 18,031 15,411 Depreciation and amortisation 7,932 5,347 Repairs and maintenance 1,299 1,330 Provision/(reversal of provision) for impairment of receivables, net 14,282 (680) Other costs 10,529 9,430 Total distribution costs 180, , General and administrative expenses General and administrative expenses were: 31 March 31 March Labour, including contributions to social funds 29,346 21,175 Depreciation and amortisation 3,337 1,783 Audit, consulting and legal services 4,093 3,638 Rent 1,835 1,348 Bank charges 1, Social expenditure Repairs and maintenance Provision/(reversal of provision) for impairment of receivables, net (129) 36 Other expenses 9,801 6,936 Total general and administrative expenses 50,725 37,238 The total depreciation and amortisation expenses included in all captions of the consolidated interim statement of profit or loss and other comprehensive income amounted to US$ 66,840 thousand (three months ended 31 March : US$ 48,425 thousand). The total staff costs (including social expenses) included in all captions of the consolidated interim statement of profit or loss and other comprehensive income amounted to US$ 107,935 thousand (three months ended 31 March : US$ 92,686 thousand). 20 Other operating income and expenses The components of other operating (income) and expenses were: 31 March 31 March Sponsorship 3,943 2,035 (Gain)/loss on disposal of property, plant and equipment and intangible assets, net Foreign exchange (gain)/loss from operating activities, net 11, Provision/(reversal of provision) for impairment and write off of idle property plant and equipment, net (Note 6) (Gain)/loss on sales and purchases of foreign currencies, net (423) (3,924) Non-recurring (income)/expenses, net 1,212 (2,547) Other operating (income)/expenses, net 1,345 (3,311) Total other operating (income)/expenses, net 18,760 (5,982) 20