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ChelyabinskZincPlant: H1 2015 Financial Results

NEWS RELEASE                                  

                                        For Immediate Release - August 28, 2015

    Chelyabinsk Zinc Plant Announces H1 2015 Consolidated Financial Results    

Chelyabinsk, Russia - August 28, 2015 - Chelyabinsk Zinc Plant (LSE, MICEX-RTS:
CHZN), Russia's largest producer of zinc and zinc alloys, is pleased to
announce its IFRS financial results for the six months ended June 30, 2015.

H1 2015 HIGHLIGHTS

  * Chelyabinsk Zinc Plant's (CZP) revenue totalled RUB 12,036 mln. 

  * EBITDA amounted to RUB 3,549 mln or 29% of revenue.

  * Net profit was RUB 3,129 mln or 26% of revenue.

Consolidated financial results

(in millions of Russian Roubles)       H1          H1     Change, % 
                                      2015        2014              
                                                                    
Revenue                              12,036      6,733       79%    
                                                                    
Gross profit                          3,892      1,838       112%   
                                                                    
                   Gross margin, %         32%        27%           
                                                                    
EBITDA (1)                            3,549      1,175       202%   
                                                                    
                  EBITDA margin, %         29%        17%           
                                                                    
Profit before income tax              3,927      1,218       222%   
                                                                    
Net profit                            3,129       925        238%   
                                                                    
                     Net margin, %         26%        14%           

(1) EBITDA, for any relevant period, represents operating profit before
interest, income tax, depreciation and amortization.

EBITDA is not a measurement of CZP's operating performance presented in the
financial information, prepared in accordance with IFRS, and should not be
considered as an alternative to operating profit or any other performance
measure derived in accordance with IFRS or other relevant financial framework.

Revenue

H1 2015 consolidated revenue increased by 79% to RUB 12,036 mln as compared to
H1 2014.

The average LME zinc price in H1 2015 increased by 4% as compared to the
relevant period of the previous year and amounted to US$ 2,134/tonne. The
average LME lead quotes decreased by 1% to US$ 1,873 /tonne. Positive effect on
revenue was made by the growth of exchange rates (US Dollar, Pound Sterling,
Kazakhstan Tenge) against the Russian Rouble.

Revenue structure

In H1 2015, revenue of CZP increased by 98% as compared to the H1 2014 and
amounted to RUB 8,017 mln (H1 2014: RUB 4,040 mln). The growth of revenue was
due to 64% increase of US dollar/Russian Rouble exchange rate (H1 2015: RUB
57.4; H1 2014: RUB 35.0), increase of sales on the domestic markets by 17% (H1
2015: 49.2 thousand tonnes; H1 2014: 41.9 thousand tonnes) and sales of
precious metals (in H1 2014 there were no sales).

Revenue of The Brock Metal Company Limited for H1 2015 amounted to RUB 2,949
mln, 100% higher than in H1 2014 (RUB 1,472 mln). This increase was due to 50%
growth of Pound Sterling/Russian Rouble exchange rate (H1 2015: RUB 87.8; H1
2014: RUB 58.6) and 23% growth of zinc alloys sales (H1 2015: 19.5 thousand
tonnes; H1 2014: 15.9 thousand tonnes).

Revenue of Nova Zinc for H1 2015 increased by 36% compared to H1 2014 and
amounted to RUB 290 mln (H1 2014: RUB 213 mln). The increase was due to 56%
growth of Kazakhstan Tenge/Russian Ruble exchange rate (H1 2015: RUB 0.31; H1
2014: RUB 0.2).

Cost of Sales

(in millions of Russian Roubles)       H1          H1     Change, % 
                                      2015        2014              
                                                                    
Raw materials and consumables used    5,501      3,068       79%    
in production                                                       
                                                                    
Utilities and fuel                    1,035       597        73%    
                                                                    
Staff cost                             645        461        40%    
                                                                    
Depreciation and amortization          574        394        46%    
                                                                    
Repairs and maintenance                381        328        16%    
                                                                    
Mineral extraction tax                 190        113        68%    
                                                                    
Other taxes                            91          65        41%    
                                                                    
Change in work-in-progress             68         174       (61%)   
                                                                    
Production overheads                   59          47        25%    
                                                                    
Change in finished goods              (479)      (427)       12%    
                                                                    
Other costs                            80          77         4%    
                                                                    
Cost of sales                         8,145      4,896       66%    

Cost of materials and consumables used primarily comprises of the cost of zinc
concentrate, zinc containing raw materials, materials for alloys production and
auxiliary materials used in the production process. The main reasons of changes
were the growth of raw materials price due to increase of exchange rates
against the Russian Rouble, volume growth of purchased raw materials (due to
structure changes of zinc and zinc alloys sales related to JSC «CZP») and
growth of auxiliary materials prices.

Net profit

Net profit for H1 2015 totalled RUB 3,129 mln compared to RUB 925 mln for H1
2014. The main factors of net income growth were the Russian Rouble
devaluation, growth of zinc and zinc alloys sales on Russian domestic market
and also the reversal of previously accrued impairment loss of LLP "Nova Zinc"
main assets.

About Chelyabinsk Zinc Plant

Chelyabinsk Zinc Plant is the leading Russian zinc producer. In 2014 the plant
produced 168,601 tonnes of saleable SHG zinc.

According to consolidated IFRS accounts, revenue in 2014 was RUB 16,508 mln and
EBITDA was RUB 3,825 mln.

Ordinary shares of CZP are traded on the Moscow exchange MICEX-RTS under ticker
CHZN and Global Depository Receipts (GDR) are traded on the London Stock
Exchange under ticker CHZN.

                                                   Investor and Media Contacts:
                                             Natalya Vasilieva, PR, ngv@zinc.ru
                                                        Tel: +7 (351) 799-01-52

                                              Evgeny Ponomarev, IR, eyp@zinc.ru
                                                          Tel: +7 963 998-55-58

This announcement may include forward-looking statements. CZP's actual results
may differ materially from those made in or suggested by the forward-looking
statements contained in this announcement. By their nature, forwarding-looking
statements involve risks and uncertainties because they relate to events and
depend on circumstances that may or may not occur in the future.
Forward-looking statements are not guarantees of future performance. Even if
the actual results are consistent with the forward-looking statements contained
in this announcement, those results may not be indicative of results or
developments in future periods. CZP does not undertake any obligation to update
any forward-looking statements to reflect events that occur or circumstances
that arise after the date of this announcement. 



END



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