Sistema announces financial results for the second quarter 2022

Moscow, Russia – 29 August 2022 – Sistema PJSFC (“Sistema”, the “Corporation”, or together with its subsidiaries and affiliates the “Group”) (LSE: SSA, MOEX: AFKS), a Russian publicly traded investment company, announces its unaudited consolidated financial results in accordance with International Financial Reporting Standards (IFRS) for the second quarter of 2022 (2Q 2022), ending 30 June 2022.

2Q 2022 FINANCIAL RESULTS

• Consolidated revenue was RUB 213.8 billion.

• Adjusted OIBDA was RUB 85.8 billion.

• Adjusted OIBDA margin was 40.1%.

KEY HIGHLIGHTS IN 2Q 2022 AND AFTER THE REPORTING PERIOD

• High level of dividend income. Sistema received final dividends for 2021 in the amount of RUB 24.9 billion from MTS and in the amount of RUB 6.2 billion from Segezha Group.
• Creation of a portfolio fishery holding. In July 2022, Sistema purchased a 75% stake in Kristall Fish LLC and a 10% stake in Khangar LLC, which specialise in catching and processing redfish; Sistema also plans to establish a large fishery holding in Kamchatka.
• Entry into the high-potential mineral water market. In June 2022, Sistema purchased the mineral water producer Arkhyz Original for around RUB 450 million, most of which was paid in the form of a debt-for-equity swap.
• Increased stake in the real-estate business. In May 2022, Sistema increased its effective stake in Etalon Group to 48.8% with the acquisition of 72.9 million global depositary receipts for RUB 4.5 billion.
• Continuation of foreign listing. In May 2022, Sistema received permission to continue the circulation of its depositary receipts outside Russia until 13 May 2023.

The Group’s adjusted OIBDA amounted to RUB 85.8 billion in 2Q 2022 as a result of an increase in adjusted OIBDA at Steppe, thanks to effective sales of surpluses from last year’s harvest and improved efficiency of milk production alongside an increase in the size of the herd, as well as higher apple sales and the development of new business lines. The consolidation of Binnopharm Group’s results and Etalon Group’s financial results as well as the effect of the derecognition of Ozon’s financial results attributable to Sistema in the Group’s consolidated financial statements had a considerable impact on the Corporation’s adjusted OIBDA trends. The adjusted net loss in 2Q 2022 was RUB 10.8 billon.

Group SG&A expenses rose to RUB 43.9 billion in 2Q 2022, mainly on the back of increased SG&A at MTS and Segezha Group, as well as the consolidation of Binnopharm Group’s and Etalon Group’s results. SG&A at MTS increased due to salary indexation as well as recognition of a subsidised loan as income in 2Q 2021. SG&A at Segezha Group rose mainly under pressure from logistics costs and salary indexation.

Group capex decreased to RUB 29.7 billion in 2Q 2022, mainly due to the postponement of a number of investment projects at portfolio companies amid heightened macroeconomic uncertainty.

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Sistema PJSFC is a publicly traded diversified Russian holding company in the sectors of telecommunications, high technology, financial services, retail, paper and packaging, agriculture, real estate, tourism and medical services. The company was founded in 1993. Revenue in 2021 was RUB 802.4 billion; total assets equalled RUB 1.8 trillion as of 31 December 2021. Sistema's global depositary receipts are listed under the "SSA" ticker on the London Stock Exchange. Sistema's ordinary shares are listed under the "AFKS" ticker on the Moscow Exchange. Website: www.sistema.ru.

The Company is not an investment company, and is not and will not be registered as such, under the U.S. Investment Company Act of 1940. Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of Sistema. You can identify forward looking statements by terms such as "expect,” "believe,” "anticipate,” "estimate,” "intend,” "will,” “could,” "may" or "might" the negative of such terms or other similar expressions. 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 to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, general economic conditions, our competitive environment, risks associated with the deterioration of the geopolitical situation, as well as many other risks specifically related to Sistema and its operations.