Evraz Regulatory News (EVR)

EVRAZ Q3 2013 PRODUCTION REPORT and INTERIM MANAGEMENT STATEMENT

18 October 2013 - EVRAZ plc (LSE: EVR) today releases its operational results for the third quarter of 2013.

Q3 2013 OPERATIONAL HIGHLIGHTS and RECENT DEVELOPMENTS:

· Consolidated crude steel production was down by 3% in Q3 2013 vs. Q2 2013 due to lower output across all assets as a result of scheduled maintenance works in Russia, idling of the steelmaking shop in the Czech Republic, and operational issues in South Africa

· Output of steel products, net of re-rolled volumes was broadly flat and supported by the seasonally strong demand for construction products in Russia, strong order book for tubular products in North America and growth of output of rails in Russia

· Share of finished steel products amounted to 75% in Q3 2013 vs. 77% in Q2 2013 due to suspension of operations at certain mills, as described below

· Output of iron ore products decreased by 1% in Q3 2013; EVRAZ VGOK was disposed of as part of our operational efficiency programme

· Consolidated raw coking coal output increased by 11% driven by the strong performance of both Yuzhkuzbassugol's and Raspadskaya's mines

· Average selling prices for most key steel product groups continued to be impacted by the downward trends in the global steel market

· Prices for iron ore products and coking coal in Q3 2013 decreased in line with global benchmarks

· Our focus on large scale and low cost operations supporting efficient vertical integration resulted in the sale of VGOK iron ore mining and processing plant and the Gramoteinskaya steam coal mine; both transactions closed in October 2013

· In the current challenging market conditions EVRAZ decided to suspend operations at the Claymont mill in the USA, at EVRAZ Palini e Bertoli in Italy, while the steel shop at EVRAZ Vitkovice Steel in the Czech Republic was operational for less than a month in Q3 2013

· EVRAZ shut down the plate rolling mill at EVRAZ ZSMK due to the low profitability of its products in the current market environment

· In Q3 2013, preliminary 1 capital expenditure totalled US$227 million, including US$118 million on investment projects, compared with US$270 million in Q3 2012. The company reiterates the outlook for capital expenditure for 2013 of US$900-1,000 million

· There has been no material change to company's balance sheet since the last reporting date

 1 Estimate as EVRAZ IFRS books are not yet closed

STEEL

Note. Numbers in this table and the tables below may not add to totals due to rounding.

* Gross volume of steel products in the tables includes those re-rolled at other EVRAZ's mills. However, such volumes are eliminated as intercompany sales for purposes of EVRAZ's consolidated operating results.

** Consolidated production volumes of semi-finished products are preliminary as intra-group re-rolling volumes are yet to be finalised.

In Q3 2013, the overall production of crude steel decreased by 3% compared to Q2 2013 due to lower output across all assets as a result of scheduled maintenance works in Russia, idling of the steelmaking shop in the Czech Republic, and operational issues in South Africa.

Consolidated production of finished steel goods decreased by 4% vs. Q2 2013 mostly due to lower output of flat-rolled products due to the shutdown of the plate rolling mill at EVRAZ ZSMK, suspension of operations at EVRAZ Palini e Bertoli due to market conditions, and weaker performance at EVRAZ North America and EVRAZ Highveld Steel and Vanadium. As a result, the share of finished steel products as a percentage of total production of steel products, net of re-rolled volumes, decreased to 75% in Q3 2013 compared to 77% in Q1 2013.

RUSSIA

The production of pig iron increased by 2% vs. Q3 2013 and vs. Q2 2012 because of less downtime at blast furnaces in Q3 2013 as a result of completed repairs.

In Q3 2013, the crude steel production decreased by 1% compared to the previous quarter, while the output of saleable pig iron noticeably increased due to scheduled maintenance at converters of both steel mills in Russia. The temporary shortage of crude steel also affected volumes of steel products, which decreased by 2%.

The production of coke saleable to third parties decreased in the reporting quarter by 24% as production was adjusted to the weak market demand. The 5% increase of coke for sale in Q3 2013 compared to Q3 2012 is a result of approximately 20% lower internal consumption of coke in pig iron production following the successful commissioning of the PCI project at EVRAZ NTMK in H1 2013.

In Q3 2013, production of steel products gross and net of volumes re-rolled into finished products within the Russian steel mills slightly decreased by 2% and 3% compared to the previous quarter and Q3 2012, respectively. The output of finished products was flat in the reporting quarter with decline in flat-rolled products fully offset by the growth in the construction (+4%) and railway products output (+3%). The output of flat-rolled products decreased as a result of permanent shutdown of the plate rolling mill at EVRAZ ZSMK in June 2013, while the output of railway products increased in the course of the ramp-up of the modernised rail mill at EVRAZ ZSMK. Production of construction products increased by 4% driven by seasonal pick-up in demand in the Russian construction market.

The lower output of semi-finished products in the reporting quarter was due to repairs at converters.

In Q4 2013, no major repairs of blast furnaces are planned. There will be some maintentance at a converter at EVRAZ ZSMK and a 8-day scheduled maintenance at the EVRAZ NTMK rail mill.

In Q3 2013, average selling prices for steel products continued to decrease reflecting downward trends in the global steel, iron ore and coking coal markets. The decrease was less pronounced in prices of steel products predominantly sold in the Russian and CIS markets - construction and railway products - as the healthy underlying domestic demand for such products partially mitigated negative global macro and sector developments. A certain decrease in prices for railway products in Q3 2013 vs. Q3 2012 is explained by the temporary change in the product mix when the rail mill at EVRAZ ZSMK was suspended for the reconstruction and the share of wheels and other railway products was consequently higher, as well as due to lower scrap and square billet price to which a portion of sales contracts is tied to.

Average selling prices

NORTH AMERICA

In Q3 2013, crude steel production at EVRAZ's North American operations was flat compared to the previous quarter. The results of the reporting quarter were 8% lower than in Q3 2012 due to operational issues at EVRAZ Pueblo and EVRAZ Regina, as well as due to lower production at EVRAZ Claymont in the subdued market.

The decrease in production of construction products in Q3 2013, mainly rods and bars (-24% vs. Q2 2013), was driven by shortage of billets from EVRAZ Pueblo's steelmaking shop and lower demand for structural tubing products.

In Q3 2013, the output of rails improved by 4% compared to the previous quarter due to the improvement of first pass yield.

The decrease in output of flat-rolled products in Q3 2013 by 8% vs. Q2 2013 was driven by suboptimal slab mix and scheduled maintenance at Regina and Claymont mills.

The output of tubular products increased by 18% quarter-on-quarter backed by the seasonal strengthening of the casing business and due to the re-launch of spiral welded pipe production at the EVRAZ Portland spiral mill. The re-launch of the Portland spiral mill is also the major factor contributing to the 12% growth of tubular products volumes in Q3 2013 vs. Q3 2012, the other factors being increased productivity and more orders at EVRAZ Regina due to a better demand for large diameter pipes and restart of long seam welded pipe production at the EVRAZ Camrose DSAW mill, which was suspended for almost all of 2012.

The output at EVRAZ North America facilities in Q4 2013 will be affected by the temporary suspension of operations at EVRAZ Claymont due to subdued market demand and the high volume of imports. This will be partially offset with expected increase of tubular production following strengthening of the order book for OCTG and large diameter pipes.

In Q3 2013, prices for all product groups, except for rails, continued to be under pressure from particularily higher volume of imports. The prices for rails remained broadly flat year-on-year and slightly decreased vs. Q2 2013 as scrap prices were lower in the reporting period.

Average selling prices

UKRAINE

Despite scheduled maintenance works on both blast furnaces in Q3 2013, pig iron production was marginally up compared to Q2 2013 and 13% higher than in Q3 2012 due to improved productivity of the blast furnaces.

The crude steel output decreased by 7% quarter-on-quarter due to higher volumes of output of saleable pig iron sold to third parties.

In Q3 2013 production of steel products was impacted by maintenance works at the re-rolling facilities.

The higher output of crude steel and steel products compared to Q2 2012 is explained by large-scale maintenance works in the converter shop carried out in 2012.

Prices for steel products recorded a minor negative trend in Q3 2013.

Average selling prices

EUROPE

In Q3 2013 the crude steel production decreased by 54% compared to Q2 2013 as EVRAZ Vitkovice Steel steel shop was in operation for less than a month in the reporting period compared to two months in the previous quarter.

The volumes of steel products declined by 32% compared to Q2 2013 due to management's decision to temporarily suspend operations at EVRAZ Palini e Bertoli plate mill starting from August 2013 in the environment of the subdued demand in the European market. Release of the working capital is expected as a result of this action.

The prices for flat-rolled products, the key product group of EVRAZ in Europe, remained virtually unchanged, while prices for construction products softened by almost 3% vs. Q2 2013.

Average selling prices

SOUTH AFRICA

In Q3 2013, the output of pig iron and crude steel at EVRAZ Highveld Steel and Vanadium decreased by 9% vs. Q2 2013, due to constraints at furnaces resulting from reduced electricity input in order to offset the impact of peak electricity tariffs.

The lower output of crude steel in Q3 2013 resulted in decreased output of finished steel products.

The crude steel output increased by 86% while production of steel products rose by 92% in Q2 2013 vs. Q3 2012 as the operations of EVRAZ Highveld Steel in the second half of 2012 were affected by the labour strike action.

The significant growth of production across all product groups in Q3 2013 vs. Q3 2012 is also explained by the strike in 2012.

The price trends for construction and flat-rolled products in the reporting quarter reflected the challenging domestic market environment, while exports of semi-finished products contributed to marginal growth of price for this product group.

Average selling prices

MINING

IRON ORE

In Q3 2013 the overall production of saleable iron ore products by the Company decreased by 1% compared to Q2 2013 mostly due to lower output of fines ore at the South African mine of the Group.

Volumes of saleable iron ore products in Russia increased by 1% due to the better performance of EVRAZ KGOK, which more than fully offset the fallout of volumes of the Irba mine at Evrazruda, which was permanently closed from July 2013.

In September 2013, EVRAZ reached an agreement to sell EVRAZ VGOK as part of a strategic programme to restructure less efficient operations and to develop the most promising mines. The gross consideration amounted to US$20 million. It is expected that following the disposal volumes of iron ore products will decrease by approximately 0.5-0.6 million tonnes per quarter. Some of the required volumes of iron ore products for EVRAZ ZSMK will continue to be purchased from VGOK on market terms or from other third parties.

Starting from October 2013, EVRAZ shut down inefficient operations of the Mundybash beneficiation plant, located 80 km from Novokuznetsk. The processing of all iron ore mined by Evrazruda will be done at the more modern Abagur beneficiation plant.

Production of lumpy ore by EVRAZ Sukha Balka decreased by 7% in Q3 2013 compared to Q2 2013, but remained elevated compared to Q3 2012 due to the productivity increase at the Yubileynaya mine as a result of a de-bottlenecking initiative implemented at the end of 2012.

The output of iron ore products at the Mapochs mine of EVRAZ Highveld in South Africa was negatively impacted by lower demand from the EVRAZ Highveld steelworks.

The prices for the key iron ore product groups somewhat softened in Q3 2013 tracking with a lag the developments in the global iron ore market.

Average selling prices

COAL*

* 2012 data for Raspadskaya is on a pro-forma basis, as Raspadskaya is consolidated in the results of EVRAZ from 16 January 2013

Coking coal

In Q3 2013, raw coking coal production increased by 11% compared to Q2 2013 and by 30% vs. Q3 2012.

The output of raw coking coal at Yuzhkuzbassugol increased by 6% compared to Q2 2013 and by 21% compared to Q3 2012 as the Yerunakovskaya VIII mine was ramping up the production to the nameplate capacity which is expected to be reached by 2014. The increased output compensated for some loss of production volumes caused by longwall repositionings at the Uskovskaya mine and one of the two longwalls of the Alardinskaya mine in the reporting quarter. Both longwalls of the Alardinskaya mine are operational starting from Q4 2013.

The Company decided to stop further tunneling at the Abashevskaya mine starting from 30 September 2013 that will ultimately result in the shutdown of the mine. The Abashevskaya mine is one of the oldest mines of the Kuzbass region that has been in operation for 70 years. Mining is currently carried out at the depth of 600 metres which carries high risks. The high operating costs make further operations uneconomic. Mining works are expected to be stopped by January 2014. The volumes of coking coal from Abashevskaya mine will be replaced by other mines of the Group.

In Q3 2013 raw coal production by the Raspadskaya coal company increased by 18% compared to Q2 2013 due to higher output from the MUK-96 mine following the repositioning of a longwall and better performance ofthe Raspadskaya-Koksovaya mine.

The Raspadskaya underground mine resumed operations in July 2013 following the completion of a set of safety measures after the suspension of mining works in May-June 2013 due to excessive concentration of carbon monoxide in certain areas of the mine.

Production of coking coal concentrate remained broadly unchanged compared to Q2 2013 and increased by 34% vs. Q3 2012 due to higher processing of increased volumes of proprietary raw coking coal by Raspadskaya and Yuzhkuzbassugol coal washing plants.

The blended average selling prices for coking coal concentrate decreased from $90/t in Q2 2013 to $78/t in Q3 2013 as the seaborne coking coal market remained soft and domestic prices tracked the global trends. The growth of Australian coking coal quarterly settlement price for Q4 is expected to have some positive effect going forward.

Steam coal

The steam coal production volumes at Kusheyakovskaya mine were flat quarter-on-quarter.

The operations at the Gramoteinskaya steam coal mine remained suspended throughout Q3 2013. On 15 October 2013 EVRAZ announced the disposal of this asset.

The output of the steam coal concentrate in the reporting period decreased due to a shift in favour of output of coking coal concentrate.

Average selling prices

VANADIUM

* Calculated in pure vanadium equivalent.

In Q3 2013, EVRAZ's total production of primary vanadium (vanadium in slag) decreased by 12% compared to Q2 2013, as a result of decreased availability of pig iron from EVRAZ Highveld Steel and Vanadium and Russian steel mills.

Production of ferrovanadium was broadly flat compared to Q2 2013.

Reduced Nitrovan output (-39% vs. Q3 2013 and -44% vs. Q3 2012) was due to lower slag availability, as a result of the need to meet the Company's contractual slag supply obligations towards Hochvanadium, and a labour strike at Vametco in South Africa lasting from September till mid-October 2013.

Production of oxides, vanadium aluminum and chemicals decreased by 17% in Q3 2013 compared to Q2 2013 due to lower supply of feedstock from EVRAZ Highveld to Hochvanadium and lower production of vanadium aluminium at Stratcor in the USA.

Average selling prices

Notes:

Semi-finished products include slabs, billets, pipe blanks and other semi-finished products.

Construction products include beams, channels, angles, rebars, wire rods, wire, and other construction products.

Railway products include rails, wheels, tyres and other railway products.

Flat-rolled products include commodity plate, specialty plate and other flat products.

Tubular products include large diameter line pipes, ERW pipes and casings, seamless pipes and other tubular products.

Other steel products include rounds, grinding balls, mine uprights, strips etc. For Ukraine they also include railway products, for Europe - slabs and cut shapes; for South Africa - rails.

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For further information:

Media Relations:

Vsevolod Sementsov

VP, Corporate Communications

London: +44 207 832 8998 Moscow: +7 495 937 6871

media@evraz.com

Investor Relations:

Sergey Belyakov

Director, Investor Relations

London: +44 207 832 8990 Moscow: +7 495 232 1370

ir@evraz.com

EVRAZ is a vertically integrated steel, mining and vanadium business with operations in the Russian Federation, Ukraine, USA, Canada, Czech Republic, Italy and South Africa. EVRAZ is among the top steel producers in the world based on crude steel production of 15.9 million tonnes in 2012. In 2012 EVRAZ sold 15.3 million tonnes of steel products. A significant portion of the company's internal consumption of iron ore and coking coal is covered by its mining operations. The company's consolidated revenues for the year ended 31 December 2012 were US$14,726 million, and consolidated EBITDA amounted to US$2,012 million. The H1 2013 consolidated revenue was US$7,362 million and the H1 2013 EBITDA was US$939 million.