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PhosAgro PAOAnnouncement

25/10/2017 17:16

PhosAgro to Lease from Gazprombank 500 New Hoppers Built by United Wagon
Company for RUB 2.9 billion With Purchase Option  

Moscow – PhosAgro (Moscow Exchange, LSE: PHOR), one of the world’s leading
vertically integrated phosphate-based fertilizer producers, announces that it
has signed an agreement with Gazprombank Leasing, a leading Russian and
European leasing company, to lease 500 next-generation hoppers for fertilizer
transportation.

The agreement is worth RUB 2.9 billion, and has been signed for 10 years with
a purchase option on the hoppers.

The hoppers will be delivered in January 2018 by Tikhvin Freight Car Building
Plant, which won a tender to supply the hoppers and is part of United Wagon
Company, a leading producer of next-generation freight cars in the CIS.

PhosAgro’s logistical assets currently have a fleet of more than 6,000 owned
and leased cars to transport primarily apatite concentrate and fertilizers
across Russia.

PhosAgro CEO Andrey Guryev said: “This transaction is designed to renew our
fleet, given the increasing demands placed on it, and to strengthen our
competitiveness both at home and in international markets. With leasing rates
for vehicles of this type increasing, having new hoppers with expanded
capacity will have a substantial economic effect, particularly given the
increases in our urea production. According to our estimates this effect could
be more than RUB 300 million.”

Increased capacity means the next-generation hoppers are able to transport
greater volumes of fertilizers – an additional 7 million tonnes more than
typical hoppers. Longer time between services (eight years or 800 thousand km)
will reduce the cost of the hoppers’ life-cycle by more than two times.

PhosAgro has operated hoppers built by the Tikhvin Freight Car Building Plant
and fitted with a running gear an increased axel load of 2 tonnes since 2013.

“Thanks to our high levels of knowledge and experience our company has been
able to become a leader in the rail transport segment,” said Gazprombank
Leasing CEO Maxim Agadzhanov. “We endeavour to embed ourselves as deeply as
possible in our clients’ business and in addition to financing can provide
expert support, arrange payment schedules and factor in all the subtleties of
the market. I believe that this approach will help us maintain our market
leadership going forward.”

Notes to Editors

PhosAgro is one of the leading global vertically integrated phosphate-based
fertilizer producers. The Company focuses on the production of phosphate-based
fertilizers, feed phosphate and high-grade phosphate rock (P(2)O(5) content of
not less than 39%), as well as ammonia and nitrogen-based fertilizers.

The Company is the largest phosphate-based fertilizer producer in Europe, the
largest producer of high-grade phosphate rock worldwide and the third largest
MAP/DAP producer in the world (excluding China), according to Fertecon.
PhosAgro is also one of the leading producers of feed phosphates (MCP) in
Europe, and the only producer in Russia.

PhosAgro has 2.1 billion tonnes of resources (according to JORC) of high
quality apatite-nepheline ore. The Company's mines and phosphate rock
production facilities are located in the mountainous areas of the Kola
Peninsula in the Murmansk region of northwest Russia, whereas its fertilizer
and feed phosphate production assets are located near the city of Cherepovets
in the Vologda region and near the city of Balakovo in the Saratov region of
southwest part of European Russia.

PhosAgro’s 2016 IFRS revenue was over USD 2.8 bln and EBITDA was USD 1.08
bln.

For further information on PhosAgro please visit: www.PhosAgro.com



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