Polyus : Trading Update for the Fourth Quarter of 2020 and full year 2020

TRADING UPDATE FOR THE FOURTH QUARTER OF 2020 AND FULL YEAR 2020

PJSC Polyus ("Polyus" or the "Company") today releases its 4Q 2020 and FY 2020 operating results for the period ending 31 December 2020.

KEY HIGHLIGHTS

1. Total gold output of 2,766 thousand ounces comes in line with FY 2020 production guidance of approximately 2.8 million ounces. However, doré gold volumes totalled 2,803 thousand ounces. The difference in total gold output and doré gold production volumes reflects accumulation of unrefined gold to be further processed in 2021.
2. Assets overview:

1. Sukhoi Log Pre-Feasibility study highlights and maiden Ore Reserve estimate published.

1. In FY 2020, total gold output at Olimpiada stood at 1.2 million ounces (down 14% year on year),

as a decline in grades in ore processed was partially offset by higher processing volumes and recovery rate.

1. Average grade in ore processed at Blagodatnoye improved to 1.82 g/t from 1.67 g/t in the previous year, resulting in 8% increase in volumes of refined gold, to 455 thousand ounces, in FY

2020.

1. Recovery rate continues to improve at Natalka, reaching 74.3% in December 2020, as the Company completed the flash flotation roll-out along with a new CIL line commissioning. Output of refined gold amounted to 455 thousand ounces in FY 2020.

1. Refined gold output increased 7% year-on-year at Verninskoye, to 273 thousand ounces, as volumes of ore processed increased to 3.3 million tonnes from 3.0 million tonnes in FY 2019.

Polyus continues further throughput capacity expansion of the Verninskoye Mill to 3.5 million tonnes per annum to be completed in 2021.

1. 1. In FY 2020, volumes of ore processed at the Kuranakh Mill rose 6% to 6.0 million tonnes. Polyus processed another 1.6 million tonnes of ore at the Kuranakh heap leaching facilities. Refined gold output at Kuranakh stood at 239 thousand ounces.
2. Production assets remained unaffected by the COVID-19 pandemic and operated without interruption during the fourth quarter of 2020. Comprehensive COVID-19 protocols remain in place at all sites.
3. FY 2021 production guidance is set at 2.7 million ounces of gold.

RECENTLY ON POLYUS:

• The Company completed the Ust-Omchug - Omchak power project in Magadan region. Natalka was successfully connected to a new 220 kV power grid, Ust-Omchug - Omchak (see link).
• Polyus has completed the Feasibility Study and the Board of Directors of the Company made a final investment decision on the construction of Mill-5 at the Blagodatnoye complex (see link).
• Polyus provided an overview of the key highlights of the Pre-Feasibility study for Sukhoi Log (see link).
• Polyus reported a maiden Ore Reserve estimate for Sukhoi Log and provided an update on the Mineral Resource estimate prepared by AMC Consultants Pty Ltd ("AMC") in compliance with JORC Code (see link).

"Pavel Grachev, Chief Executive Officer of PJSC Polyus, commented:

Our key focus in 2020 was a comprehensive response to the COVID-19 pandemic. Throughout this challenging year, the Company worked hard to ensure the health and safety of all our employees, which is our constant priority. As we move into 2021, our wide-rangingCOVID-19 protocols remain in place at all our sites to ensure the absolute minimum risk to our people.

In 2020, we have made further progress with both brownfield and greenfield development projects, despite the spread of the COVID-19 pandemic, which has affected the timelines of engineering studies.

At Sukhoi Log, we completed the Pre-Feasibility study, an important milestone that reaffirmed the status of Sukhoi Log as one of the world's highest-calibre gold deposits. On top of this, we published the maiden Ore Reserve estimate for Sukhoi Log, which currently stands at 40 million ounces. This addition to the Company's reserve base constitutes a solid platform for our long-term development strategy. The Feasibility study for Sukhoi Log is now underway, and we anticipate its completion in 2022.

At the very end of 2020, Polyus approved the construction of Mill-5 at the Blagodatnoye complex. In upcoming years the Company will employ a disciplined and properly staged approach to developing Blagodatnoye, both on processing and mining sides of operations.

Based on the mining calendars and reached processing capabilities we expect total gold output in 2021 at 2.70 million ounces of gold."

ESG UPDATE

Highlights

• Coronavirus: Production assets remained unaffected and operated without interruption during 4Q 2020. Thorough COVID-19 protocols remain in place.
• FY 2020 LTIFR1 at 0.10 (9M 2020 - 0.08; FY2019 - 0.08). One fatality during FY2020, as reported in 3Q 2020 (FY2019 - 1, FY2018 - 3)
• No environmental incidents during 4Q 2020

Coronavirus update

• Polyus allocated $155 million towards COVID-19 prevention measures in 2020. This figure includes procurement of medical and personal protection equipment, as well as amounts spent on refurbishing healthcare facilities at the regional hospitals and salary increases paid to staff working extended shifts.
  o The Company delivered 3.2 thousand units of medical equipment, including 71 lung ventilators and 5 CT scanners to hospitals in the regions of presence.
  o Polyus procured 371 thousand test kits, 4.3 million masks, 1.7 million pairs of glove, and 1.3 million personal antiseptics to be used by Company employees and donated to local communities.
• Preventive measures remain in place at all sites, including enhanced medical screening, physical distancing, procuring personal protective equipment and regular disinfection of communal areas.
• All shift employees are tested for COVID-19 and quarantined in observation facilities prior to transfer to Polyus' sites.

Health & Safety

• HSE Risk Management System Development: Deloitte completed its complex assessment of the HSE risk management system. A total of 275 interviews was conducted across the Company, 4 sites were visited (Verninskoye, Alluvials, Vitimenergo and Kuranakh).
• Despite the COVID-19 pandemic, implementation of current HSE plans continued with minor adjustments. Safety culture level for 2020 stood at 2.6 on the Bradley Curve (2019 - 2.4; 2018 - 2.3), according to an independent assessment.

Environment

• Ust-Omchug- Omchak power project in Magadan region has been completed, providing additional energy transmission capacity, improving the reliability of low-cost renewable power supply.
• Safety audits of tailings storage facilities were held per schedule at Natalka, Kuranakh and Verninskoye.
• 2020 fish stock recovery campaign: Polyus released a total of 387,171 valuable commercial juvenile fish species into regional water bodies.
• Report on the International Cyanide Management Code certification audit of Polyus Logistics (Irkutsk) was finalized.
• Olimpiada, Blagodatnoye, Natalka, Verninskoye, Alluvials, Polyus Logistics, Polyus Stroi, Power Group underwent remote environmental compliance audits.

ESG Ratings and indices

• In December 2020, the inclusion of Polyus' shares in two RSPP & MOEX indices was confirmed: Responsibility and Transparency Index, Sustainable Development Vector Index.
• Polyus' current ESG ratings: SAM - 54, CDP - Climate Change: C, Water Security: C; Sustainalytics ESG Risk Rating - 29 (3 points improvements vs 2019), MSCI ESG - A

1 Based on a 200,000 work hours' factor.

FY 2020 HIGHLIGHTS

• Total gold output of 2,766 thousand ounces comes in line with FY 2020 production guidance of approximately 2.8 million ounces. However, doré volumes totalled 2,803 thousand ounces, down 2% year-on-year. The difference in total gold and doré gold output reflects accumulation of unrefined gold to be further processed in 2021.
• The decline was attributable to operations at Olimpiada and driven by the decrease in average grades in ore processed to 3.40 g/t in 2020 from 3.92 g/t in the previous year. This was partially offset by increased in production volumes at all other hard-rock deposits.
• Volumes of ore mined amounted to 71,155 thousand tonnes, up 8% on the previous year, reflecting higher ore volumes mined at Blagodatnoye, Natalka, Verninskoye.
• Volumes of ore processed increased 2% to 45,113 thousand tonnes, driven by throughput capacity expansion at Natalka, Verninskoye and Kuranakh.
• Recovery rate increased to 83.8%, driven by brownfield initiatives across all operating assets.
• Flotation concentrate output decreased 29% to approximately 87 thousand tonnes with volumes of gold contained in flotation concentrate amounting to 198 thousand ounce. This reflects the improved performance of bio-oxidation and lower amounts of antimony-rich ore mined and processed at Olimpiada in 2020.

4Q 2020 HIGHLIGHTS

• Total gold output amounted to 710 thousand ounces, compared to 771 thousand ounces in the third quarter of 2020. This decline was driven by a seasonal slowdown in production at Alluvials and lower flotation concentrate output at Olimpiada. Scheduled maintenance works with the replacement of SAG-mill at Mill No. 3 also negatively impacted doré gold output at Olimpiada. However, the SAG-mill replacement was completed ahead of schedule and drove processing volumes up in December.
• Volumes of ore mined amounted to 17,301 thousand tonnes, down 5% on the previous quarter, reflecting lower ore volumes mined at Olimpiada, Kuranakh and Verninskoye.
• Volumes of ore processed decreased 15% quarter-on-quarter to 10,438 thousand tonnes, due to the seasonal slowdown of heap leaching operations at Kuranakh and scheduled maintenance works across almost all hard- rock deposits.
• Recovery rate decreased to 83.9%, compared to 84.1% in the previous quarter, driven by lower recoveries at Olimpiada.

CONSOLIDATED OPERATING RESULTS

	4Q'20	3Q'20	Q-o-Q	2Q'20	1Q'20	4Q'19	Y-o-Y	2020	2019	Y-o-Y
Olimpiada	268.0	254.8	5%	264.0	215.0	300.8	-11%	1,001.8	1,071.7	-7%
Blagodatnoye	117.4	118.3	-1%	116.3	103.4	126.2	-7%	455.4	420.8	8%
Verninskoye	67.4	68.6	-2%	68.3	69.1	63.9	5%	273.4	255.9	7%
Alluvials	38.0	75.5	-50%	29.8	-	34.6	10%	143.3	145.6	-2%
Kuranakh	64.2	66.5	-4%	57.5	50.5	62.9	2%	238.7	224.7	6%
Natalka	132.7	117.4	13%	110.4	95.0	132.3	0%	455.5	405.0	12%
Refined gold, koz	687.7	701.1	-2%	646.3	533.0	720.7	-5%	2,568.1	2,523.7	2%
Flotation concentrate production, t	7,323	23,219	-68%	30,023	26,185	33,756	-78%	86,750	121,362	-29%
Antimony in flotation concentrate, t	1,837	3,950	-53%	2,432	2,739	4,936	-63%	10,958	14,773	-26%
Gold in flotation concentrate, koz	22.0	70.0	-69%	44.1	61.9	83.3	-74%	198.0	317.5	-38%
Gold payable in concentrate, koz	17.2	55.5	-69%	32.4	48.5	61.8	-72%	153.6	235.5	-35%
Total gold output, koz	709.7	771.1	-8%	690.4	594.9	804.0	-12%	2,766.1	2,841.2	-3%
Rock moved, km³	30,741	32,210	-5%	28,909	32,373	32,421	-5%	124,233	127,952	-3%
Stripping ratio, m³/t	1.4	1.4	0%	1.3	1.4	1.3	8%	1.4	1.5	-7%
Rock moved, kt	78,706	82,535	-5%	73,836	83,352	83,591	-6%	318,429	328,863	-3%
Stripping ratio, t/t	3.5	3.5	0%	3.3	3.6	3.4	3%	3.5	4.0	-13%
Ore mined, kt	17,301	18,265	-5%	17,364	18,226	19,011	-9%	71,155	66,095	8%
Ore processed, kt	10,438	12,224	-15%	11,753	10,698	11,527	-9%	45,113	44,078	2%
Recovery rate, %	83.9%	84.1%	-0.2ppts	83.4%	83.6%	83.2%	0.7ppts	83.8%	82.3%	1.5ppts
Total doré & slime gold output, koz	660.7	770.2	-14%	712.4	660.2	714.3	-8%	2,803.5	2,846.6	-2%