Chairman’s Statement

Sergey Chemezov
Chairman of the Board of Directors

Uralkali continued to implement global best practices in corporate governance and environmental protection.

Dear shareholders,

Uralkali saw a number of important developments over the reporting period that had a significant impact on the Сompany’s operating and financial activities. These developments included the arrival of a new major shareholder, changes in the Board of Directors and the completion of two open-market share and GDR buyback programmes, as well as the signing of the largest syndicated loan in Uralkali’s history.

2016 was a difficult year for all potash producers. Despite a challenging market environment characterised by weak demand and increased competition, the Company retained its position as a major player in the industry. The Company benefits from some of the lowest costs in the sector, high quality products, significant production potential and a substantial resource base. Uralkali continued to implement global best practices in corporate governance and environmental protection. In addition, the Company paid considerable attention to improving occupational safety in order to minimise the number of accidents at Uralkali’s industrial sites. The Company continued to develop and modernise its existing production facilities in order to safeguard its ability to respond flexibly to changes in market conditions and promptly fulfil orders for potash fertilisers from domestic and foreign consumers. In this regard, Uralkali demonstrated relevant operational and financial performance for the reporting period: production - 10.8 million tonnes, revenue – US$2.3 billion, EBITDA – US$1.2 billion.

I would like to point out that Uralkali remains one of the most attractive employers in the Perm Territory. The Company successfully implements numerous social projects to support its employees and is actively involved in the development of Berezniki and Solikamsk. I would also like to thank the Board of Directors and all Uralkali’s employees for their substantial contribution towards the development of the Company and the strengthening of its position, as well as for their professionalism and dedication to their work. Finally, I would like to express my gratitude to all of the Company’s shareholders, investors and partners for their trust and support.