POG.L Regulatory News (POG)

5 December 2019

Petropavlovsk PLC (the 'Company')

Corporate Update

Update Statement following 2019 AGM Voting Outcome

In accordance with the requirement of Provision 4 of the UK Corporate Governance Code (2018), Petropavlovsk PLC (the 'Company') is providing this update following significant votes (defined as above 20%) against the following resolutions at its annual general meeting ('AGM') held on 13 June 2019:

·; the election or Mr Bektas Mukazhanov (Non-Executive Director)*.

·; the re-election of Sir Roderic Lyne (Chairman)

·; the re-election of Mr Robert Jenkins (Independent Non-Executive Director)

·; authority to allot shares

·; two separate resolutions relating to the disapplication of pre-emption rights (special resolutions).

Of the above, those proposed as ordinary resolutions were passed but the special resolutions were not passed.

As detailed in the statement published by the Company immediately following the AGM, the Company has consulted with shareholders. The Chairman personally wrote to shareholders who voted against the above resolutions to understand why they had voted against the Board's recommendation.

Following this communication the Chairman, Mr Harry Kenyon-Slaney, Senior Independent Director and Mr Robert Jenkins, Chair of the Audit and Remuneration Committees had meetings with certain of the Company's shareholders.

During this consultation process the following points were raised:

Re-election of directors

Certain shareholders voted against:

- Sir Roderic Lyne, the Company's Chairman and Chairman of the Nominations Committee. These shareholders highlighted their concerns about the diversity of the Board. As detailed in the 2018 report of the Nominations Committee the Board's aim was to identify and recruit both female and younger Directors with relevant qualifications.

Following an extensive search the Company announced the appointment of Ms Charlotte Philipps and Mrs Katia Ray as Independent Directors of the Company with effect from 8 November 2019. The Board now comprises 22% of females, with nationals of six different countries.

- Mr Robert Jenkins, Chairman of the Audit Committee because, due to reasons detailed in the 2018 audit report, the proposed audit tender was deferred until 2019. A tender process has now been undertaken by the Audit Committee on behalf of the Board, full details of which will be provided in the 2019 Annual Report.

In addition certain shareholders also raised concerns regarding the level of disclosure of bonus targets in the Directors' Remuneration Report. The Remuneration Committee will ensure that these comments are fully considered during the preparation of the 2019 Directors' Remuneration Report.

*Mr Bektas Mukazhanov, nominee Director of Fincraft Holdings Ltd, the Company's major shareholder, resigned as a Non-Executive Director of the Company on 30 July 2019 following the transfer of Fincraft Holdings Ltd to AEON Corporation.

Authority to Allot Shares and Dis-apply Pre-Emption Rights

It was disappointing to note that during this consultation process no shareholder raised any specific concerns regarding the authority to allot shares and the two special resolutions to disapply pre-emption rights. The Board notes that these resolutions were aligned with the Investment Association's share capital guidelines and with market practice for FTSE listed companies. In addition shareholders were supportive of resolutions to allot shares and disapply pre-emption rights proposed at the 2018 AGM. The Company intends to discuss these resolutions with major shareholders prior to the 2020 AGM.

The Board appreciates the feedback it received during this process and would like to thank those shareholders who participated in this exercise. The Board will continue its policy of proactive engagement with its shareholders.

Smaller Related Party Transaction

Purchase of TEMI Option Agreement

The Company refers to its announcement dated 23 September 2019 regarding the option agreement with Agestinia Trading Limited ("Agestinia").

Following Agestinia's confirmation that the Company has satisfied its obligations in respect of the purchase of the option agreement and approval from the Russian Federal Antimonopoly Authority that Petropavlovsk can acquire Agestinia's 25 per cent. interest, the Company confirms that Petropavlovsk now has the option to acquire this interest, as detailed in the previous announcement (the 'Option').

Should Petropavlovsk determine to exercise the Option, it is likely that the transaction would constitute a Related Party Transaction under Listing Rule 11.1 and, if it does, it would require, inter alia, shareholder approval.

About Petropavlovsk

With a Premium Listing on the London Stock Exchange, Petropavlovsk (LSE: POG) is a major integrated Russian gold producer with JORC Resources of 20.5Moz Au which include Reserves of 8.2Moz Au.

The Company's key operating mines (Pioneer, Malomir and Albyn) are in the Amur Region in the Russian Far East and the Company has produced a total of c.7.5Moz of gold since operations began in 1994. Petropavlovsk has a strong track record of mine development, expansion and asset optimisation.

The Group recently entered a new era of growth following the successful commissioning and start-up of its flagship asset, the Pressure Oxidation (POX) Hub at Pokrovskiy, which enables the processing of the Company's abundant refractory reserves and resources.

Petropavlovsk is one of the region's largest employers and one of the largest contributors to the sustainable development of the local economy.

For more information

Please visit www.petropavlovsk.net or contact: