Annual Report 2010 - Magnitogorsk Iron & Steel Works

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EVENTS AFTER THE ACCOUNTING DATEMMK has reached a new stage in its development as a large diversified company. In order to adapt the MMKGroup’s management system to the changed conditions, the Company’s annual general meeting on 20 May 2011approved a new revision of the Charter. The Board of Directors’ responsibilities have been expanded to include,in addition to determining the Company’s priorities and strategy, approval of all transactions with a value inexcess of 0.3% of the Company’s assets’ book value as of the latest accounting date. The management structurein accordance with the newly revised Charter is shown below:MMK Corporate Governance Structure ( 20.05.2011)AuditorGeneral Shareholders' MeetingAuditCommitteeBoard of DirectorsCorporateSecretaryChairman of BoDSecretary of BoDBoD members(5 out of 10 independent)BoD Committee forAudit(independentdirectors)BoD Committee forNominations andRemuneration(independentdirectors)BoD Committeefor StrategicPlanning andCorporateGovernanceControlAdministrationIndividual Executive Body –General DirectorShareholders’ StructureThe authorized capital of MMK totals RUB 11,174,330,000 and is comprised of 11,174,330,000 ordinaryregistered shares with a par value of 1 rouble each. All shares are placed securities. The Company is entitled toplace, in addition to those already placed, ordinary shares amounting to 26,299,840,577 shares, with a par valueof 1 rouble each (declared shares). Declared ordinary shares grant the same rights as placed ordinary shares.Equity capital structure as of 04.04.2011shareholder , Share, % of equity capitals name02.04.2010 04.04.2011Mintha Holding Limited* 45 45Fulnek Enterprises Limited* 41 41The Bank of New York International Nominees ** 9,7 9,7Other shareholders 4,3 4,3Total shares 100 100* The company's beneficiary isV.F. Rashnikov, Chairman of theOJSC MMK Board of Directors.** Beneficiaries are owners ofglobal depositary receipts listedon the London Stock Exchange52
16 22 26 28 32 38 50 72MMK , sBusiness ModelMMK’s Missionand StrategyOJSC MMK Boardof Directors'The Company'sProductionSales MarketsFinancesCorporateGovernanceEnvironmentProtectionOJSC MMK’s management has no information aboutany shareholders with over 5% of shares except asdisclosed above.The Company calculates and pays dividends inaccordance with Russian laws and the Regulations onDividend Policy approved by the Board of Directors on14 February 2008, which can be found at:http://www.mmk.ru/corporate_governance/internal_documents/group_documents/.MMK's dividend policy is based on the balanceof shareholders' interests and the Company’srequirements for growth and technology upgrades.The Annual Report contains information aboutaccrued dividends in the section “Information forShareholders and Investors”.General Shareholders’ MeetingHolders of the Company’s ordinary shares, inaccordance with the Federal Law “On Joint StockCompanies” and OJSC MMK’s Charter, have the rightto participate in General Shareholders’ Meetings withthe right to vote on all matters raised at the meeting,to receive dividends or a part of the Company’sproperty at its liquidation, and other rights providedfor by the above mentioned law.Shareholders who in their totality own not less than2% of the Company’s ordinary registered shares areentitled to propose issues for the agenda of AnnualGeneral Shareholders’ Meetings and to nominatecandidates to the Board of Directors whose numbershall not exceed the number of members of that body.Such proposals must be submitted to the Companynot later than 40 days following the end of thefinancial year.Interfax and AK&M, authorized agencies forinformation disclosure in the stock market,named MMK the winner of the annualcompetition “For Active Corporate Policy inthe Area of Information Disclosure”.According to the information transparencyresearch conducted by Standard&Poor’s, in2010 the Company rose from the 3rd to 2ndposition among Russia’s 90 largest companies.Shareholders owning not less than 10% of theCompany’s ordinary registered shares are entitled torequest the Company’s Board of Directors to hold anExtraordinary General Shareholders’ Meeting.Shareholders exercise their rights related to theCompany's management by voting at GeneralShareholders’ Meetings.In 2010, the Company held one Annual GeneralShareholders’ Meeting.The following issues were on the agenda of theGeneral Shareholders’ Meeting held on 21 May 2010:• approval of the annual report, annual financialstatements, including profit and loss accountsof the Company, as well as profit distribution,including dividend payments, and lossesdistribution according to the results of 2009;• election of members of the Board of Directors;• election of members of the Audit Committee;• approval of the Auditor;• determination of the size of remuneration andcompensation to be paid to the members of theOJSC MMK Board of Directors;• determination of the size of remuneration andcompensation to be paid to the members of theAudit Committee;• approval of OJSC MMK’s revised internal documentsregulating the operation of OJSC MMK’s bodies:“Regulations on OJSC MMK’s General Shareholders’Meeting”, “Regulations on OJSC MMK’s Board ofDirectors”;• approval of interested party transactions.Reports on the results of voting at the Shareholders’Meeting and relevant materials can be found at:http://www.mmk.ru/corporate_governance/the_structure_of_government/shareholders_meeting/1302/.EVENTS AFTER THE ACCOUNTING DATEAn extraordinary general shareholders' meeting on 20 January 2011 approved a number of interested partytransactions.Steel & Style , 10 MMK ANNUAL REPORT 53
Page 4 and 5: ContentsAnnual Report2010Editor-in-
Page 6 and 7: Products for the Automotive Sector6
Page 8: Statement of the Chairmanof the Boa
Page 11 and 12: 16 22 26 28 32 38 50 72MMK , sBusin
Page 13: 16 22 26 28 32 38 50 72MMK , sBusin
Page 16 and 17: Business Model ММК16
Page 18 and 19: 18Diverse Product Mix and Sales Foo
Page 20 and 21: Significant Growth Potential20
Page 22 and 23: NEW TRACKSMMK’s Missionand Strate
Page 24 and 25: To localize their production, forei
Page 26 and 27: OJSC MMK Board of Directors' Report
Page 28 and 29: The Company's ProductionOperationsT
Page 30 and 31: The Company's Production Operations
Page 37 and 38: Any colouror hue foryourproduct!Col
Page 49 and 50: The Head of the State also highly p
Page 51: 16 22 26 28 32 38 50 72MMK , sBusin
Page 67 and 68: Risk ManagementIn 2010, the followi
Page 76 and 77: MMK Industrial Waste108644,8Total s
Page 78 and 79: Stakeholder EngagementCorporate soc
Page 80 and 81: Demag, ThyssenKrupp, АМСОМ, AL
Page 82 and 83: Information forShareholders andInve
Page 84 and 85: OJSC MMK Share Quotes and Trading V
Page 86 and 87: conferences for investors with MMK
Page 88 and 89: Open Joint Stock CompanyMagnitogors
Page 90 and 91: CONSOLIDATED STATEMENT OF FINANCIAL
Page 92 and 93: CONSOLIDATED STATEMENT OF CHANGES I
Page 94 and 95: CONSOLIDATED STATEMENT OF CASH FLOW
Page 96 and 97: Information on Companies in Which O
Page 98 and 99: Part Description PagePart 2: Financ
Page 100 and 101: Use of the GRI Reporting Framework
Page 102:
No. Description Pages CommentsEN2 P
Page 106 and 107:
General Information on OJSC MMKFull
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Annual Report 2010 - Magnitogorsk Iron & Steel Works

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