DGAP-News

IMH: INDUSTRIAL METALLURGICAL HOLDING (KOKS GROUP) ANNOUNCES 1H 2014 FINANCIAL RESULTS - Seite 2

(the Vladimirskaya mine) for a total of RUB 1.560 billion due to the
mine close-down. This exercise resulted in a net loss of RUB 96 million
for the period, an 88% reduction y-o-y. IMH's net profit for Q2 2014
was RUB 145 million.

- PP&E purchase costs in 1H 2014 were down by 35% y-o-y as a result of
the investment strategy revision and abandonment of projects with a
long payback period and a relatively low rate of return. The Coal
segment accounts for the major portion of the costs owing to the
continuing construction of the second phase of the Butovskaya mine and
construction of the Tikhova mine.

- Net cash flow from operations reduced by 9% following a significant
reduction in the payables. In addition, the receivables are going up,
which is attributable to the trade policy changes. In particular, some
clients were allowed additional deferred payments.

- Debt was 6% up as at 30 June 2014 versus 31 December 2013, mainly due
to the working capital growth. In addition, weakening of the Russian
currency, which had caused the revaluation and increase of the cost of
USD-denominated loans also contributed debt value growth.

Financial Performance by Key Segments

Coal



RUBm 1H 2014 1H 2013 1H 2014 /


1H 2013, %

Segment revenue 3,693 3,589 +3



IFRS-based consolidated EBITDA 416 575 (28)

IFRS-based consolidated EBITDA margin 11% 16% _


The Coal segment's 1H 2014 revenue increased by 3% due to a higher volume
of coal processed under tolling arrangements. This ensured a 7% growth of
revenue from external operations despite lower market prices for coal. The
segment's EBITDA was adversely impacted by the costs incurred by ZAO
Siberian Resources and OOO Gornyak, which stopped generating cash flow
after the termination of operations in 2013, but continued generating costs
associated with asset maintenance and mothballing. Currently, both entities
are under liquidation.

The cost of production at TSOF Berezovskaya dropped by 38% due to lower
coal prices. The cost of production at the Uchastok Koksovy open-pit mine
remained flat y-o-y.

In 1H 2014, the total output at the Coal segment's facilities was 903
thousand tonnes of coal (+15% y-o-y) and 1.187 million tonnes of coal
concentrate (flat y-o-y).

Coke



RUBm 1H 2014 1H 2013 1H 2014 / 1H 2013,
%

8,765