FY2013 RESULTS

FY2013 RESULTS PRESENTATION MAY 15, 2014

DISCLAIMER

This presentation does not constitute or form part of and should not be construed as,

an offer to sell or issue or the solicitation of an offer to buy or acquire securities of

Mechel OAO (Mechel) or any of its subsidiaries in any jurisdiction or an inducement to

enter into investment activity. No part of this presentation, nor the fact of its

distribution, should form the basis of, or be relied on in connection with, any contract

or commitment or investment decision whatsoever. Any purchase of securities should

be made solely on the basis of information Mechel files from time to time with the U.S.

Securities and Exchange Commission. No representation, warranty or undertaking,

express or implied, is made as to, and no reliance should be placed on, the fairness,

accuracy, completeness or correctness of the information or the opinions contained

herein. None of the Mechel or any of its affiliates, advisors or representatives shall

have any liability whatsoever (in negligence or otherwise) for any loss howsoever

arising from any use of this presentation or its contents or otherwise arising in

connection with the presentation.

This presentation may contain projections or other forward-looking statements

regarding future events or the future financial performance of Mechel, as defined in

the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995.

We wish to caution you that these statements are only predictions and that actual

events or results may differ materially. We do not intend to update these statements.

We refer you to the documents Mechel files from time to time with the U.S. Securities

and Exchange Commission, including our Form 20-F. These documents contain and

identify important factors, including those contained in the section captioned “Risk

Factors” and “Cautionary Note Regarding Forward-Looking Statements” in our Form

20-F, that could cause the actual results to differ materially from those contained in

our projections or forward-looking statements, including, among others, the

achievement of anticipated levels of profitability, growth, cost and synergy of our

recent acquisitions, the impact of competitive pricing, the ability to obtain necessary

regulatory approvals and licenses, the impact of developments in the Russian

economic, political and legal environment, volatility in stock markets or in the price of

our shares or ADRs, financial risk management and the impact of general business

and global economic conditions.

The information and opinions contained in this document are provided as at the date

of this presentation and are subject to change without notice

2

FINANCIAL HIGHLIGHTS

-3

15

0.6

23

533

-4

0.3

11

SEGMENTS OVERVIEW

REVENUE FROM THIRD PARTIES EBITDA BY SEGMENTS

$ Mln

$ Mln

(1) Adjusted EBITDA represents EBTIDA adjusted by forex gain/loss, interest income, net income on the disposal of non-current assets, amount attributable to non-controlling interests gain/loss from remeasurement of

contingent liabilities at fair value, impairment of long-lived assets and goodwill, result of disposed companies (incl.the result from their disposal) provision for amounts due from related parties and losses from discontinued

operations, net of income tax. 4

Steel Mining Ferroalloys Power

EBITDA(1) BY SEGMENTS

10,631 8,576 2,089 1,885

32

96

147

124

62

211

127

64

202

148

49

196

83

35

122

Mining Steel Ferroalloys Power Consolidated*

4Q12 1Q13 2Q13 3Q13 4Q13

FY2013

5%

29%

66%

FY2012

Consolidated revenue down 19% y-o-y to $8.6 bn on asset

disposals and weaker prices

Bad debt provisions and write-offs due to assets disposals

result in a Net Loss of $2.9 bn for 2013

Mining segment continues to dominate in the consolidated

EBITDA with its share of 66%

60% 58% 59% 55%

32% 32% 33% 33%

1% 1% 1% 1%7% 9% 7% 11%

FY12 FY13 3Q13 4Q13

Steel Mining Ferroalloys Power

3%

27%

70%

MINING SEGMENT

$ Mln

CASH COSTS, US$/TONNE COS STRUCTURE

$2,128 mn $1,842 mn

5

REVENUE, EBITDA(1)

678

770693 695

626

142

136130 110

149

4%

14%15%

18%

11%

0%

30%

60%

0

300

600

900

4Q12 1Q13 2Q13 3Q13 4Q13

Revenues (lhs) Intersegment revenues (lhs) Adj. EBITDA margin (rhs)


contingent liabilities at fair value, impairment of long-lived assets and goodwill, result of disposedcompanies (incl.the result from their disposal) provision for amounts due from related parties and losses from discontinued

operations, net of income tax.

Segment’s EBITDA down to $83 in 4Q13 largely due to 10%

revenue decrease on lower volumes

Cash costs at Russian assets up on seasonal factors

Cash costs at Bluestone up 29% q-o-q as most of its

capacity is idled due to unfavorable pricing environment

41

29

45

115

4334

52

88

3931

53

78

34 32

43

86

35 37

51

111

Coal SKCC Coal YU Iron Ore Bluestone

4Q12 1Q13 2Q13 3Q13 4Q13

51%43%

20%23%

9%11%

14% 16%

6% 7%

FY12 FY13

Other

Depreciation and depletion

Energy

Staff costs

Raw materials and purchased goods

MINING SEGMENT

6

REVENUE BREAKDOWN BY REGION AVERAGE SALES PRICES FCA, US$/TONNE

*Restated to include middlings

EXTERNAL SALES STRUCTURE

214

93

69

5159

207

95

6352

92

199

8366

52

77

178

7157

49

78

176

7866

44

85

Coke Coking coal Anthracite and PCI Steam coal* Iron ore

4Q12 1Q13 2Q13 3Q13 4Q13

Share of met coal sales is stable y-o-y at 64% of Segment’s

revenue

Anthracite & PCI volumes up 16% y-o-y endorsing our strategy

of diversifying met coal portfolio

Coal shipments to China grow x1.3 to 39% y-o-y of overall sales

as we continue expansion into Asia Pacific

Share of 3d party iron ore sales down 43% q-o-q as we

switched to supplying our steel segment

43% 39% 37% 40%

21% 25% 26%27%

11% 8% 7%8%

2% 2%2%

3%8% 9% 9%

9%

13% 15% 17%11%

2% 2% 2% 2%

FY12 FY13 3Q13 4Q13

Coking coal Anthracites and PCI Coke Coking products Steam coal Iron ore Other

27% 27% 26% 27%

14% 14% 14% 13%

9%2% 1% 3%

29% 39% 42% 38%

12% 10% 10% 11%

5% 4% 2% 5%4% 4% 5% 3%

FY12 FY13 3Q13 4Q13

Russia Europe CIS China Asia w/o China Middle East Other

STEEL SEGMENT

7

CASH COSTS, US$/TONNE COS STRUCTURE

REVENUE, EBITDA(1)

$5,644 mn $4,379mn

$ Mln

1,492

1,3431,359

1,2251,029

72

70 50

50

73

6%

4%5%

4%3%

-5%

-2%

1%

4%

7%

10%

13%

0

500

1,000

1,500

4Q12 1Q13 2Q13 3Q13 4Q13


502

437 444

494

439 447472 468 479

504

419 425

507

436 448

Billets* Wire Rod Rebar

4Q12 1Q13 2Q13 3Q13 4Q13

78% 76%

8% 9%

9% 10%2% 2%

3% 3%

FY12 FY13

Other

Depreciation and depletion

Energy

Staff costs





Segment’s revenue down 16% due to seasonal demand

slowdown and termination of resale business with Estar…

…with cash costs slightly up on seasonal factors…

…resulting in 4Q13 EBITDA decreasing to $35 mn

Bottom line affected by $70 mn of related parties bad debt

provision and $17 mn of FX loss

* Domestic sales

60% 65% 66% 68%

19%18% 18% 18%

4%2%

10%12% 13% 12%

6% 3% 2% 1%1% 1% 1%

FY12 FY13 3Q13 4Q13

Russia Europe Asia CIS Middle East Other

STEEL SEGMENT

8

REVENUE BREAKDOWN BY REGION AVERAGE SALES PRICES FCA, US$/TONNE

EXTERNAL SALES STRUCTURE

16% 10% 7% 5%

26%29% 32% 30%

2% 3% 3%3%

14% 17% 17% 19%

7% 8% 8% 9%

14% 15% 16% 16%

8% 8% 8% 7%

13% 10% 9% 11%

FY12 FY13 3Q13 4Q13

Semi-finished steel products Rebar Stainless flat products

Carbon long products Forgings and stampings Hardware

Carbon flat Other

511

677

3910

2411

927

700

490

635

3999

2505

912

689

491

620

3776

2391

879

710

533

607

3530

2457

835

663

535

594

3501

2183

873

676

Semi-finished steel products

Rebar Stainless flat products

Forgings and stampings

Hardware Carbon flat

4Q12 1Q13 2Q13 3Q13 4Q13




Sales of rebar decrease by 7% y-o-y due to disposal of loss-

making Romanian steel plants

Share of semi-finished products down 57% y-o-y as we launch

the universal mill at Chelyabinsk and terminate resale

business with Estar

Share of Russia and CIS goes up to 77% of Segment sales as

we gradually exit our European operations

AVERAGE FERROSILICON SALES PRICES AND CASH COSTS, US$/TONNE

FERROALLOYS SEGMENT*

REVENUE, EBITDA(1)

9

$ Mln

19

2022

20 19

1011

108 8

-11%

2%

15% 10%

1%

-20%

-10%

0%

10%

20%

30%

40%

50%

60%

04Q12 1Q13 2Q13 3Q13 4Q13


* As of December 31, 2013, a number of companies of the ferroalloys segment met criteria for classification as discontinued operations under US GAAP and were disclosed as a separate component from Mechel

Group’s continuing operations retrospectively for all comparative periods presented.

(1) Adjusted EBITDA represents EBTIDA adjusted by forex gain/loss, interest income, net income on the disposal of non-current assets, amount attributable to non-controlling interests gain/loss from remeasurement of contingent

liabilities at fair value, impairment of long-lived assets and goodwill, result of disposed companies (incl.the result from their disposal) provision for amounts due from related parties and losses from discontinued operations, net of income

tax.

Revenue down 6% q-o-q due to decrease of FeSi sales and

weaker pricing

FeSi cash costs up by 5% as electricity price grows

$269 mn write-off on disposed chrome assets affects bottom

line

Nickel and chrome business results deconsolidated as

Discontinued operations

REVENUE BREAKDOWN BY REGION

1256 1242 1199

1142 1110

907 961

903

823 863

4Q12 1Q13 2Q13 3Q13 4Q13

sales price Cash costs

82%

57% 62%68%

1%

16%

31%28%

25%

1%12% 10% 7%

FY12 FY13 3Q13 4Q13

Russia Europe Asia Other

POWER SEGMENT

10

AVERAGE ELECTRICITY SALES PRICES AND CASH COSTS (RUSSIA), US$/MWH COS STRUCTURE

REVENUE, EBITDA(1)

$ Mln

$880 mn $884 mn

220227

169149

209

118123

10198

115

4%7%

1%-2%

3%

-20%

-10%

0%

10%

20%

30%

40%

50%

0

100

200

300

4Q12 1Q13 2Q13 3Q13 4Q13

Revenues (lhs) Intersegment revenues(lhs) Adj. EBITDA margin (rhs)




Revenue up 40% q-o-q due to high season

Cash cost down 19% as sales of heat and electricity grow

EBITDA back to black with $11 mn

53.8 56.252.5 54.4 55.4

24.526.2

29.035.0

28.2

4Q12 1Q13 2Q12 3Q12 4Q13

Sales price Cash costs

88% 88%

3% 4%6% 6%

1% 1%2% 1%

FY12 FY13

Other

Depreciation

Energy

Staff costs


Consolidated P&L

11

REVENUE DYNAMICS REVENUE, EBITDA(1) AND NET PROFIT

Consolidated EBITDA down 38% q-o-q to $122 mn due to lower profitability in the mining and steel segments affected by price and

sales deterioration

4Q2013 bottom line affected by write offs of $274 mn as a result of discontinued operations, $79 mn of bad debt provisions and FX loss

of $14 mn

4Q2013 FINANCIAL PERFORMANCE Q-O-Q HIGHLIGHTS:

$ Mln $ Mln

2,0891,885

-227 22

0

1,000

2,000

3Q2013 Volume Price 4Q2013

2409 23602243

20891885

147 211 202 196 122

-1114

-321

-1799

-127

-681

6%9% 9% 9%

6%

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

(1,900)

(1,400)

(900)

(400)

100

600

1,100

1,600

2,100

2,600

4Q12 1Q13 2Q13 3Q13 4Q13

Revenue (lhs) Adj. EBITDA (lhs) Net profit (lhs) Adj. EBITDA




Cash Flow Statements

12

NET CASH FLOW

Continuing working capital management added another $108 mn

in Q4 to the CFO that totaled $324 mn for FY2013

Inventory reduction release another $101 mn in Q4 to add up to

$507 million inventory release for FY2013

CAPEX is halved y-o-y standing at $558 mn in 2013 as main

investment projects near their completion stage and Elga CAPEX

secured through VEB project financing

FY’11* FY’12 FY’13

* Excluding the effect of loan to Estar

399

1,311

324

-1,674

-839

-180

2,079

-792

-162

Operating activities Investment activities Financial activities

OPERATING CASH FLOW DYNAMICS

$ Mln

249

83

8

223

10

4Q12* 1Q13* 2Q13* 3Q13 4Q13

* Сertain reclassifications to conform with the current period presentation

-558

441

-63-180

CAPEX Asset Disposals Other 2013 Investment Cash Flow

2013 INVESTMENT CASH FLOW BREAKDOWN

0 49 - - - -

685

1,674 1,527

1,308

578

175

645

580

101

225

38

212 281

-

- -

103

-

-

-

123

111

70

51

32

1,070

2,745

2,459

1,460

835

0

500

1000

1500

2000

2500

3000

14.5.14 2014 2015 2016 2017 2018 and after

Renewable lines Other term loans (w/o VEB) russian

Other term loans foreign Expiration of put options on bonds

Maturity of bonds Expiration of financial lease

Successful refinancing and improved liquidity to service upcoming maturities

In 1Q2014 RUR 21.5 bln was redeemed or refinanced.

Cash and available credit lines total $0.5 bln as of April 30, 2014.

Net debt was reduced by US$560 mn, reaching US$ 8.6 bln as of

April 30, 2014.

Agreement reached with VTB to refinance $0.5 bln of debt

maturing on 2014, reducing short-term debt.

DEBT PROFILE AS OF APRIL 30, 2014

RUR 51% USD

42%

EUR 7%

Russian

Banks

68%

13

DEBT MATURITY SCHEDULE AS OF MAY 14, 2014 DEBT MATURITY SCHEDULE AS OF DECEMBER 6, 2013 **

Foreign

Banks

25%

Bonds

7%

78 130 99

1,302

2,139 2,147

1,443

777

427

197 296

-

-

-

- -

-

-

13

168

118 77

57

24

190

2,027

2,453 2,520

1,499

801

0

500

1000

1500

2000

2500

3000

6.12.13 2013 2014 2015 2016 2017 2018 and after

Renewable lines Other term loans

Expiration of put options on bonds Maturity of bonds

Expiration of financial lease

** assuming refinancing of GBP lines of 2009 and changes in schedule of VTB – lease from December 20, 2013

69

340 31

440

Cash

Other undrawn credit lines

78

394

31

503

Cash

Other undrawn credit lines

ECA undrawn amount

Revenue 1,885 2,089 -9.8%

Cost of sales (1,315) (1,445) -9.0%

Gross margin 30.2% 30.8%

Operating profit / (loss) (136) 39 -

Operating margin -6.1% 1.6%

Adjusted EBITDA(1) 122 196 -37.8%

Adjusted EBITDA(1) margin 6.5% 9.4%

Net Income / (loss) (681) (127) 436.2%

Net Income margin -36.2% -6.1%

Sales volumes(2), ‘000 tonnes

Mining segment 5,279 6,148 -14.1%

Steel segment 1,277 1,564 -18.4%

FINANCIAL RESULTS OVERVIEW

(1) Adjusted EBITDA represents EBTIDA adjusted by forex gain/loss, interest income, net income on the disposal of non-current assets, amount attributable to non-controlling interests gain/loss from remeasurement of contingent

liabilities at fair value, impairment of long-lived assets and goodwill, result of disposed companies (incl.the result from their disposal) provision for amounts due from related parties and losses from discontinued operations, net

of income tax.

(2) Includes sales to the external customers only

US$ MILLION UNLESS OTHERWISE STATED 4Q13 3Q13 CHANGE, %

14

Economy & Finance

FY2013 RESULTS