Annual Report 2011 - Magnitogorsk Iron & Steel Works ...

2011 / ANNUAL REPORT
/ 2011 /
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Creating the future!
3
93, Ul.Kirova, Magnitogorsk, Russia
Tel.: 8–800–775–000–5 (toll free in Russia)
Fax: (3519) 24–73–09
www.mmk.ru

2011 /
Editor-in Chief:
A. N. Andrianov
Editors:
V. E. Ruga
O. V. Rashnikova
Project coordinators:
A. A. Smirnov
V. V. Dryomov
Project team:
E. V. Azovtseva
L. K. Buriakova
A. D. Deviatov
A. E. Serov
V. N. Khavantseva
E. V. Lysenko
R. E. Kondrin
I. O. Kosmarova
Design and layout:
Y. V. Puskareva
Photos:
A. Serebriakov
E. Rukhmalev
D. Rukhmalev
A. Bardentsev
S. Likhachov
Address:
93, Ul.Kirova,
Magnitogorsk, Russia
Tel.: 8-800-775-000-5
(toll free in Russia)
Fax: (3519) 24 73 09
Http:// www.mmk.ru
ANNUAL REPORT
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IN THE ISSUE
Address of the Chairman
of the Board of Directors
Financial Results for 2011
2011 Highlights
The MMK Business Model
MMK CEO Boris Dubrovsky:
Results and Outlook
MMK Group
Overview and Analysis of the Steel Market
Financial review
Risk Management
Social Responsibility
Environmental Protection
Corporate Governance
Information for Investors
Board of Directors report
on MMK's performance in 2011
General Information on MMK
General Information on the Annual Report
4 5

2011 /
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Address of the Chairman of the Board of Directors
Dear shareholders, colleagues and partners!
Magnitogorsk Iron and Steel Works has a very
special year in 2012.
On the 1st of February MMK celebrated its 80th
anniversary. In our eight decades we have achieved
impressive results, having produced 563.5 million
tons of pig iron, 731.1 million tons of crude steel
and 576.1 million tons of finished steel products.
Very impressive figures!
Magnitka has never enjoyed easy times: its history
began with the unprecedented pace of construction
during the country’s industrialization, includes the
challenges of wartime and post-war reconstruction,
and more recently the consequences of the
collapse of the country in 1990s, including years
of political and economic crises. Working in a
market-based economy made the crisis years of
2008 and 2009 a serious test of MMK’s strength.
In 2007 MMK produced a record 12.2 million
tons of finished steel products. The subsequent
decline in demand for steel products in 2008-2009
prevented us from maintaining the growth rates
we had achieved. Today MMK is gradually restoring
production volumes. Despite a challenging
macroeconomic situation in 2011, MMK produced
11.724 million tons of crude steel and 10.646
million tons of finished steel products during the
year. Prices for commercial steel products grew
17 % y-o-y in 2011. Deliveries to the strategically
important domestic market grew in 2011, and
constituted 67 % of MMK’s total sales volume.
MMK Group’s revenue for 2011 stood at USD 9.306
billion, up 21 % in from 2010. Unfortunately we
did not achieve all of our goals: MMK Group’s 2011
EBITDA decreased compared to 2010 and equalled
USD 1.336 billion.
Last year MMK’s Board of Directors introduced
important changes to the Company’s corporate
governance structure to bring it more in line with
international best practice. A shareholder meeting
on 20 May 2011 voted to elect Boris Dubrovsky as
the General Director of MMK, and to transfer the
authority of the sole executive body from MMK
Managing Company LLC to the General Director
of MMK. Mr. Dubrovsky has vast experience both
at MMK, where he occupied the post of executive
director until 2008, and at Uralvagonzavod, where
he was the first deputy general director from 2009
to 2011.
At a meeting of the State Committee for
Modernization held in Magnitogorsk in 2011,
Russia’s President praised MMK’s success in
modernization of the Company’s assets. We believe
this is a logical recognition of our hard work. We
have systematically carried out a comprehensive
modernization of MMK’s production base over
the course of the last 10 years. This investment
program was designed to meet demand from
Russian customers and to increase MMK’s
production of higher value added products. We
undertook a fundamental overhaul of the long
products facilities, built modern galvanizing and
colour coating lines, revamped the 2,000 mm
hot rolling mill, built a steel making complex in
Turkey, constructed the unique 5,000 mm plate
mill – and commissioned it in the middle of the
crisis. Between 2000 and 2011 we invested around
USD 8.3 billion through our long-term investment
program. Our investments peaked in 2008-2009, at
over USD 1.5 billion per year.
MMK’s large-scale investment projects, aimed
at the expansion of production capacities and
the introduction of new types of products, have
increased the Company’s debt levels. MMK
used debt to finance the majority of its capital
expenditure investment projects, but has recently
sought to optimize these projects in order to keep
debt at sustainable levels. We achieved this goal in
2011, with capital expenditure at the level of just
USD 1.2 billion, a decrease of 46 % from 2010.
MMK today has found new momentum and
meaning. Using our extensive experience, we are
tackling the production targets and social issues
that we face step by step. We are successfully
implementing upgrades and new technologies. Our
most recent major investment projects, the 5,000
mm and 2,000 mm rolling mills, have opened up
long-term prospects.
We have gained valuable experience from
working in difficult situations. In 2012 we will
focus on increasing energy efficiency and labour
productivity, on reducing costs, quality control
and mastering new types of higher value added
products.
I am confident that history will repeat itself and
MMK will overcome current difficulties such as
the global economic and financial crisis, and will
continue to advance and grow We have everything
we need to achieve this: experience solving the
most complicated problems, up-to-date equipment
and technologies, self-sufficiency in electricity,
strong competitive positions, product flexibility
and, most important of all, highly skilled personnel.
On behalf of the Board of Directors I want to
express our gratitude to the whole MMK team
for their dedication, proficiency, preservation
of traditions and hard work. We are also truly
grateful to our partners for their cooperation with
us. We are interested in working with you. All our
efforts, all our modernization projects are first and
foremost aimed at meeting your needs.
6 7
V. F. Rashnikov

2011 /
MMK Group’s Financial Results for 2011
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2011
11.158 million tonnes
Output of finished steel products
Total Debt/EBITDA
Profit (loss) for the period
CAPEX (financing of acquisition of fixed assets)
2010
1.409 million tonnes
USD 1,336 million USD 1,606 million
4.066 million tonnes
3.968 million tonnes
USD 9,306 million USD 7,719 million
USD 474/t
14%
USD 365 million
USD 340/t
21%
USD 610 million
3.31 2.21
USD 1,154 million
EBITDA
Output of high value added products
Revenue
Cash-cost of slabs
EBITDA margin
Operating income
USD 232 million
USD 2,209 million
8
9
HIGHLIGHTS OF 2011
JANUARY
Metallosnabzhenie & Sbyt magazine recognized MMK as the largest producer of flat products
in Russia.
FEBRUARY
MMK launched a new version of its official website (http://www.mmk.ru), introducing online
ordering for our customers.
MARCH
Russian President Dmitry Medvedev visited MMK and held an on-site session of the
Government's Commission for Modernization and Technological Development.
APRIL
Renault-Nissan confirmed the compliance of MMK’s quality management system with the
automaker's standards.
MAY
Fitch Ratings upgraded MMK's long-term issuer default rating from ВВ to BB+, and the longterm
national scale rating, from АА- (rus) to АА (rus).
JULY
MMK launched the first stage of the 2,000 mm Cold Rolling Complex at a ceremony attended
by Russia’s Prime Minister Vladimir Putin. The key product from the 2.0 mtpy complex will be
premium-quality cold-rolled and galvanized steel sheet for exterior and interior car parts.
SEPTEMBER
MMK announced the completion of a USD 485 million deal to buy out 50 % minus one share of
its partner in its Turkish steel JV, thus consolidating 100 % of the MMK Metalurji subsidiary.
NOVEMBER
MMK launched an electronic auction platform for online purchasing of materials and
equipment.
FEBRUARY 2012
MMK’s Anniversary: 80 years ago, on 1 February 1932, MMK’s first blast furnace produced first
pig iron. This day marked the birth of MMK.

2011 /
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Steel segment (Russia) Steel segment (Turkey) Coal segment
% of consolidated revenue* % of consolidated revenue % of consolidated revenue**
Production output (kt) Production output (kt) Production output (kt)
2010
2011
2010
2011
MMK’s Business Model MMK’s Strategic Goals
About the Company
MMK is one of the world’s top steel producers and a leader of the Russian steel sector. Its production
capacity enables MMK to produce 15.6 million tons of quality steel products per year.
93.9% 4.5% 1.6%
10,253
10,653
0 4,000 8,000 12,000
156
0 100 200 300 400 500 600
EBITDA margin (%) EBITDA margin (%)
18.1%
13.3%
2010
2011
-14.4%
-15%0 -10%
-8.0%
0% 5% 10% 15% 20% -20%
-5%
505
2010
2011
2010
2011
2010
2011
0 500 1,500 2,500 3,500
EBITDA margin (%)
34.2%
2,960
3,216
48.6%
0% 20% 40% 60%
* excluding intra-Group sales
** the majority of coal segment sales (about 76% of volume) is supplied to MMK Group’s parent company (OJSC MMK)
10 11
2
MMK’s key goal is to maintain its long-term
competitiveness on the global steel markets.
To achieve this goal MMK is doing the following:
Diversifying into new of
products
4
Ensuring sustainable development
Expanding its sales markets
1
3
Reducing costs

2011 /
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Markets Expansion
MMK Metalurji (Republic of Turkey)
Project’s Highlights
• State-of-the-art integrated steel-making facility
• Rolled steel capacity: 2.3 mtpy
• Products: hot rolled, galvanized and colour-coated steel
• Start of production: 2010
• Full production capacity to be reached in 2012
• Total project cost: USD 2.4 billion
Istanbul
MMK Metalurji
TURKEY
Iskenderun
MMK Metalurji
12 13
Competitive advantages:
• Favourable geographic position (growing markets of Turkey and other Middle East countries)
• Good logistics (own sea port and plant’s compact size)
• State-of-the-art equipment
• Diversified product mix
The construction of the Turkey steel project started in March 2008. The project, with an annual capacity
of 2.3 million tons of flat steel products, is located on two sites: Iskenderun and Istanbul. Investments
in the project totaled approx. USD 2.4 billion. MMK Metallurji includes an electric arc furnace shop
with a compact casting and rolling unit (CSP), a cold rolling mill, a steel service centre with a hot dip
galvanizing (HDG) and colour coating (CC) lines in Inskenderun, and a steel service centre with an HDG
and CC lines in Istanbul.
The Iskenderun plant also includes a sea port capable of handling vessels up to 100,000 DWT, which is
instrumental to exporting the plant’s products and importing raw materials.
Iskenderun’s EAF shop with a CSP unit was commissioned in March 2011, with the first steel coil
produced in May 2011.
MMK Metallurji is expected to reach design capacity during 2012.

2011 /
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Diversification into New Products Cost Reduction
2,000 mm Cold Rolling Complex
Parsytec
Project highlights
Continuous HD galvanizing line
Parsytec, Ra
Parsytec, Ra
• State-of-the-art equipment by SMS Demag AG, Germany
• Capacity: 2 mtpy
• Products: Premium quality cold rolled and galvanized steel sheet
• Start of production: 2011
• Full design capacity to reached in 2012
• Total project cost: USD 1.5 bn
The new 2 mtpy cold rolling complex will produce premium quality cold rolled and galvanized sheet,
including from high strength steel, for the automotive sector.
The first stage of the complex, comprising a tandem mill with a pickling line, was launched in July 2011.
The 2nd stage is scheduled to come on stream in the summer of 2012.
Once the 2,000 mm Mill reaches full capacity in 2012, we estimate our products will account for about
40 % of the Russian automotive steel market. Though we set our sights on a more ambitious goal of
50 % market share. We are now in the process of having our products tested and certified by potential
customers. Upon completion of this process, we will supply cold rolled products to our subsidiary
Intercos-IV in St. Petersburg, which will process the steel into stamped parts and ship them to domestic
and foreign auto makers working in Russia. In October 2011, Ford completed a comprehensive audit of
our production facilities.
By mid-2013 MMK plans to start shipping products to all major auto makers active in Russia.
Improving efficiency through cost reduction has always been a priority for MMK, with special cost cutting
measures developed and implemented on an annual basis. In 2011 various organizational and technical
measures yielded savings of USD 177 million, including:
• USD 88 million, through reduced consumption of raw materials and other inputs;
• USD 68 million, through reduced costs for industrial services;
• USD 21 million, through reduced consumption of auxiliary materials.
Portion of fixed costs in MMK’s
production costs (%)
MMK Group’s 2011 cost structure (%)
Iron ore
Coal
Scrap
Ferro alloys
Electric power
Natural gas
Salaries and
administration costs
Other costs
The new 2012 cost reduction programme being implemented aims to achieve savings of USD 160 million.
14 15
700
600
500
400
300
200
100
0
350
300
250
200
150
100
50
0
Platts (right axis)
287
62
Prices for iron ore materials according
to Platts index and slab cash cost (USD)
323
62
362 362
124
* Premium Peak Downs HCC (price basis - fob Australia)
71
450
110
495 490
Prices for coking coal*
and coal concentrate cash cost (USD)
coal price benchmark (right axis)
163
102
459
131
200
150
100
400
300
250
200
150
100
50
0
50

2011 /
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Sustainable Development Key Performance Indicators
2010
2011
2010
2011
Electric
power
Scrap
Coal
Iron ore
Supplies of raw materials
and power
Coal concentrate production (kt)
0 500 1,500 2,500 3,500
0 1,000 2,000 3,000 4,000 5,000
0
2,960
3,216
Captive iron ore production (kt)
4,679
4,825
Self-sufficiency level (%)
30%
40%
75%
100%
20 40 60 80 100
Raising the level of selfsufficiency
in iron ore and
coal supplies is one of the
key components of MMK’s
strategy.
In 2011 supplies of captive
iron ore increased 3 % yearon-year,
while production
of coal concentrate in the
Company’s coal segment
grew by 9 %.
2010
2011
2010
2011
2010
2011
HR development Reduced impact
on the environment
Labour productivity (ton/person)
49
51
0 10 20 30 40 50 60
Personnel turnover (%)
2.6%
0.0 0.5 1.0 1.5 2.0 2.5 3.0
Production related injuries
(instances)
19
3.0%
21
0 5 10 15 20 25
In 2011 MMK Group’s
expenditure on improving
labour safety and conditions
totaled over USD 15 million.
2010
2011
2010
2011
2010
2011
Emissions per unit produced (kg/t)
21.4
20.4
0 5 10 15 20 25
Waste processing (kt)
1,767
2,017
0 500 1,000 1,500 2,000 2,500
Power consumption per unit produced
(Gcal/t)
6.3
6.4
0 1 2 3 4 5 6 7 8
MMK has an ISO - certified
environmental management
system since 2004. An ISO
compliance certificate to
the effect was issued by
TUV NORD CERT GmbH,
Germany.
MMK’s capex on
construction of
environmental facilities in
2011 amounted to over USD
68 million.
16 17
Goal
Sales markets expansion
Diversification
onto new products
Costs reduction
Ensuring
sustainable
development
Indicator
Quantity of steel sales
in tonnes
Share of HVA
products
in the total output
Power consumption
per tonne of liquid steel
Emissions of pollutants
per tonne of steel
Personnel turnover rate
Labour productivity
Achievement
2011 commercial
product
sales was 11.2 mt,
7 % up on 2011.
In 2011 the share of HVA
products in total production
decreased by two percentage
points to 36 %.
This indicator shows
the efficiency of power
use in steel production.
In 2011 it was 6.4 Gcal/t.
Emissions declined 21.4 kg/t
in 2010 to 20.4 kg/t in 2011.
Stayed at a low level
of 3 % in 2011
In 2011 this indicator
reached its peak value
in the last 5 years
– 51 ton/person

2011 /
B. A. Dubrovsky
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MMK CEO Boris Dubrovsky:
Results and Outlook
Steel Consumption
MMK’s 2011 budget was based on the assumption
of 18 % growth in steel consumption in Russia,
which guided our plans for increasing deliveries to
the domestic market compared to 2010. However,
Russian steel consumption grew only by 12-15 %
in 2011 according to various estimates. Prices for
raw materials rose together with steel prices in the
first quarter of 2011, but then continued to grow
in the remaining part of the year. By the middle of
the year, prices for iron ore and coal had risen by
30%, having reached record high prices. In order to
retain customers and withstand competition, MMK
was forced to sell finished products with a margin
lower than 10 % for several months. The situation
stabilized only in the middle of the fourth quarter
due to a global decline in iron ore and coal prices.
Due to rising prices for key raw materials in 2011,
production cost per unit grew by 20 % compared to
2010. Rising costs were partially compensated by
higher steel prices. Cost reduction measures were
undertaken to maintain margins at acceptable
levels.
Performance
MMK Group produced 11.2 million tons of steel, 3.2
million tons of coal concentrate and 465 thousand
tons of metalware in 2011. The Group’s 2011
revenue was USD 9.306 billion, an increase of 21 %
from 2010. Russian steel segment revenue stood
at USD 8.9 billion, coal segment revenue was USD
649 million, and revenue for MMK-Metalurji in
Turkey was USD 458 million. Hot-rolled products
accounted for 47 % of 2011 revenue, while high
value-added (HVA) products contributed 36 % in
2011. Increasing the share of revenue from HVA
products is a strategic task for MMK. Substantial
investments were undertaken to achieve this
strategic task in recent years, and we expect to
increase the share of HVA products to 45 % in
terms of volume and 50 % in monetary terms in
the near future. The Group’s EBITDA stood at USD
1.336 billion, with an EBITDA margin of 14.4 %.
The steel making segment, with USD 1 billion, and
the coal segment, with USD 222 million, were the
largest contributors to EBITDA.
Investments
Investments in 2011 totalled USD 1.2 billion,
with USD 790 million spent at the Magnitogorsk
site and USD 176 million in Turkey. While we
will continue to invest in production, we have
introduced new principles for budgeting, the key
one being "living within our means."
Magnitka is rightfully proud of its modernization
effort. We have achieved a great deal and done a
good job, implementing highly efficient projects
on very tight timeframes. But at some point our
expenditures on investments exceeded what we
could achieve through our own operating activities.
We have resolved to reduce the Company’s debt
burden. The 2012 budget is deficit-free and
balanced. Similar to 2011, our investments should
not exceed our ability to finance the projects
ourselves.
Strategic Goal
One of MMK’s strategic goals is to become a
leading steel supplier for automakers in Russia.
Construction of a state-of-the-art cold rolling
shop including the 2,000 mm cold rolling mill is
in its final stages. The 2 million ton per year steel
production facility will provide the automotive
industry with high-quality cold-rolled and
galvanized flat products, including products that
use high-strength steel.
ММК has been actively developing new products
for the automotive industry for several years. The
Company has undertaken a program of acceptance
of its steel products by Russian and foreign
automakers, according to which MMK’s production
processes and products are to be approved by
major global automotive groups (including Ford
Motor Company, General Motors, Volkswagen,
Renault-Nissan and Hyundai-Kia) and Russian
automakers (including AvtoVAZ).
Other major initiatives have been implemented as
part of the MMK Group’s innovation programme.
In 2011, we started using a SAP-based master
planning system to optimize and enhance
production performance. In 2012, we plan to adopt
a scheduling system.
As a result of these achievements we can look
to the future with confidence. We have a good
understanding of how and by what means we can
achieve our 2012 targets, thus laying a strong
foundation for the Company’s sustainability and
fast growth.
Continuity of Tradition
Magnitogorsk Iron and Steel Works celebrated
its 80th anniversary in early 2012. It is difficult
to overstate the significance of this anniversary.
MMK started its history as the most ambitious
construction project of the 20th century, and eight
18 19
decades later it is one of Russia’s largest steel
manufacturers. MMK has made an important
contribution to the development of the domestic
steel-making industry, and to Russia's economy in
general.
Each generation of MMK employees has the right
to claim heroic achievements, to say the least.
All those who built the plant, who produced the
first ton of hot metal, who worked and fought
during World War II, who set production records
in Soviet times, and who overcame the difficulties
of Perestroika and the global recession. They all
deserve deep respect and gratitude. Today the
fundamental tradition of Magnitka’s steelmakers to
rely only on their own resources and qualifications,
and never on luck, remains unchanged.
Social Priorities
We are well aware that it is impossible to ensure
further sustainable growth without preserving and
developing our human resources, and we make
our best efforts to pursue a responsible social
policy. In 2011, ММК spent over RUB 1 billion on
various social programmes. Over RUB 437 million
were committed to supporting retirees and for
charity purposes. We allocated RUB 243 million
for medical purposes. We plan to increase social
support in 2012.
I would like to thank our employees for their
invaluable contribution to the Company’s growth
and excellent performance.
Our Customers
We place a special focus on developing
relationships with our customers. Close
cooperation is a precondition of mutual growth.
Customers are a valuable asset for MMK, just
like our production facilities. Our obligations
to customers must be performed in full and on
schedule. A great deal has already been done in
this sphere to enable us to strengthen our presence
on domestic and international markets.

2011 /
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Other products and services Raw materials mining
Sinter, coke
and processing
and blast furnace division
CJSC Mekhano-Remontny Kompleks
Steel structures,
replaceable
equipment,
mill rolls,
maintenance
and repair
services
Construction,
erection
and repairs
107.5 thousand t
of equipment;
services rendered
for RUB 6.7 bn
MMK as priority customer
(up to 72% of sales)
Services rendered
for RUB 2.7 bn
Lime,
dolomite,
iron ore mining
CJSC Stroitelny Kompleks OJSC Belon
MMK as priority customer
(up to 73% of sales)
Installation
and repair
of electrical
equipment,
maintenance
services
Mining
and processing
of coking coal
LLC Elektroremont CJSC Profit
Services
rendered
for RUB 2.1 bn
MMK as priority customer
(up to 88% of sales)
2 473 000 t
of ore,
833 000 t
of dolomite,
1 012 000 t
of lime
4 036 000 t
of run
of mine coal;
3 216 000 t
of coal
concentrate
produced
MMK as priority customer
(up to 78% of sales)
Collection
and processing
of scrap
2 322 000 t
LLC NPO Avtomatika LLC Bakal Mining Administration
Service
maintenance
and repairs of
automatic
process control
systems
Services
rendered
for RUB 1.3 bn
MMK as priority customer
(up to 92% of sales)
MMK as priority customer
(up to 99% of sales)
Siderite iron ore
(52% Fe),
calcined siderite
concentrate,
sinter ore
1 404 000 t of ore;
1 040 000 t of
calcined siderite
concentrate
MMK as priority customer
(up to 77% of sales)
LLC Buskul
Refractory clay 308 000 t
the MMK Group as priority customer
LLC Ogneupor
Aluminosilicate 220 000 t
and periclasecarbonaceous
refractories
MMK as priority customer
(up to 77% of sales)
OJSC Magnitogorsk
Cement and Refractories Plant
Cement
and ferruginous
dolomite
576 000 t
of cement,
462 000 t
of ferruginous
dolomite
Ferruginous dolomite - 100% by ММК;
Cement - the Ural Region
Production
of coke, sinter,
pig iron
5 386 000 t
of coke,
11 316 000 t
of sinter,
9 496 000 t
of pig iron
Steel melting
in basic oxygen,
electric arc
and open-hearth
furnaces
Steel melting
in electric arc
furnaces
Steel melting Hot rolled products Cold rolled products Downstream steel processing Steel sales
11 724 000 t
of crude steel
471 000 of steel
HR products 9 668 000 t
with a thickness of HR products,
of 1.2 - 160 mm 1 504 000
and long products of long products
HR products
with a thickness
of 1 - 8 mm
416 000 t
of HR products
MMK Metalurji
OJSC Magnitogorsk Iron and Steel Works
CR products
with a thickness
of 0.35 to 3 mm
CR products
with a thickness
of 0.25 to 2 mm
MAGNITOGORSK
IRON & STEEL
WORKS
MAGNITOGORSK
Products
and services
2 133 000 t
of CR products
383 000 t
of CR products
Company's name
Sales market
Gross output
in 2011
Galvanized
and colour
coated rolled
products, tin
plate, formed
section, tubes
Galvanized
and colour
coated rolled
products
Wire, CR narrow
strips, strip,
railway and
mechanical
fasteners,
calibrated steel,
steel mesh,
nails, steel rope
Stamped parts,
the steel service
centre
Corrugated floor
board, steel tile,
siding, sandwich
panels, formed
sections
819 000 t
of galvanized
products,
288 000 t
of colour coated
products,
136 000 t
of tin plate,
258 000 t
of formed section,
57 000 t of tubes
361 000 t
of galvanized
products,
138 000 t
of colour
coated products
465 000 t
of metalware
Sales
of steel products
Sales
of steel
products
OJSC MMK-Metiz
CJSC Intercos-IV
Domestic market, CIS
Sales
of metalware
Turkish market
Russia
(22% of sales)
33 000 t Sales
of stamped parts
MMK Group
Leningrad Region
5 064 000 t
of products sold
438 000 t
of products sold
466 000 t
of products sold
33 000 t
of products sold
OJSC MMK-Profil-Moskva LLC MMK Trading House
62 000 t Sales of products
of MMK,
MMK-Profil-Moskva
947 000 t
of products
Russia, CIS
MMK Trading
Sales of products
of ММК and
MMK Metalurji
3 532 000 t
of products sold
Middle East, Europe, Asia
21

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New horizons
Products for the automotive and construction sectors
93, Ul.Kirova, Magnitogorsk, Russia. Tel.: 8-800-775-000-5 (toll free in Russia). Fax: (3519) 24 73 09
www.mmk.ru
22 23

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Overview and Analysis of the Steel Market
According to the World Steel Association, global steel production reached 1.5 billion tonnes in 2011, an
increase of 6.8% over 2010. Apparent steel consumption grew by 6.5 %, reaching 1.4 billion tonnes in
2011.
2011
2010
2009
2008
2007
A key contributor to growing global steel production and consumption in the past decade was China. The
country’s production grew 8.9 % in 2011, reaching 696 million tonnes, and apparent consumption was up 7.5 %
to 643 million tonnes.
700
600
500
400
300
200
100
0
0
59
2001
RUSSIA
151
Global Steel Production and Consumption
800 1,200 1,600
2002
Steel Production in Russia and China
CHINA
2003
66
281
2004
2005
In 2011 Russia increased crude steel production by 2.4 % to 68.4 million tonnes. Despite this growth,
India overtook Russia in 2011 as the #4 global steel producer, increasing steel production by 5.7 % to 72
million tonnes in 2011. The other top global producers are China (696 million tonnes), Japan (108 million
tonnes) and the USA (86 million tonnes).
2006
72
490
2007
2008
Steel production, m tonnes
Steel consumption, m tonnes
2009
2010
68
696
2011
700
600
500
400
300
200
100
0
Steel production at MMK in 2011 grew by 3 % (to 11.7 million tonnes), at a rate on par with the average
for Russia.
Crude Steel Production at MMK Finished Products Production at MMK
2011
11.7 miliion tonnes
2010
11.4 million tonnes
24 25
250
200
150
100
50
0
2007
222
154 150
60%
5%
29%
7%
9%
66%
15%
+3 %
18%
Share of domestic sales, %
17%
56%
2011
10.6 million tonnes
2010
10.2 million tonnes
MMK has successfully increased its share of the Russian finished steel goods market for two years in a
row: from 17 % in 2009 to 17.7 % in 2010, and 17.9 % in 2011.
Structure of Russian Steel Production Market in 2011
Russian and CIS Markets
ММК
Severstal ChMK
In 2011 shipments to the domestic market (including the CIS) totalled 7.2 million tonnes, an increase of
2 %. The share of domestic shipments in MMK’s sales decreased by 2 %, from the highest-ever level of
67 % in 2010.
As high value added products prevail in domestic sales, the average price per tonne for steel products
on the domestic market has historically enjoyed a premium over average export prices. Average
domestic steel prices were USD 241/t higher than average export prices in 2011.
NLMK
ZSMK
MMK's Share of Domestic Sales as a Function of Price Premium
190
241
69% 67%
2008 2009 2010 2011
NTMK
Other
Domestic price premium, USD/t
100%
90%
80%
70%
60%
50%
40%
30%
20%
+4 %

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Based on the structure of apparent consumption of the output of Russian steelmakers in 2011, MMK remains
the leading Russian steelmaker.
MMK’s share of the Russian market in 2011 was 16 %. Apparent steel consumption in Russia grew twice
as fast as world consumption in 2011, and amounted to 12 %, with imports growing by 31 %.
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
15%
2007
16%
* source: Metal-Courier information agency
Apparent Consumption of Russian Steelmakers’ Output for 2011
3%
25%
17%
17%
6%
13%
Foreign steelmakers are especially active in the HVA product segment.
4%
16%
6%
ММК
15%
8%
12%
17%
41.3 38.4
26.9 36.9 41.5
In the HVA product segment, Russian companies only managed to increase market share in colour-coated
steel products in 2011.
ММК
Severstal
NLMK
ZSMK
NTMK
Shares of MMK and Imports in Russia*
Impor ts
17%
14%
Apparent consumption of steel products
16%
ChMK
Imports
Ural Steel
Other
16%
2008 2009 2010 2011
80
70
60
50
40
30
20
10
0
26 27
Galvanized products
22%
Galvanized products
67%
20%
Colour coated products
12%
21%
HR plate
13%
-5%
CR products
40%
11%
Change in imports
Change in consumption
MMK felt the full effect of growing imports in 2011. Our share in domestic sales of HVA products
decreased across all categories, with the exception of colour coated products. Our 1 % increase in
market share was driven by 32 % growth in sales of colour coated products in 2010. While sales of cold
rolled products in 2011 increased by 8 % compared to 2010, this was not sufficient to prevent a 1 %
decrease in market share.
16%
-14%
Impact of Imports on the Domestic Market for HVA Products in 2011
Colour coated products
13% 14%
Changes in MMK's Domestic HVA Products Market Share
32%
HR plate
19% 17%
-11%
CR products
22% 21%
Change in MMK's domestic sales
MMK’s largest domestic customers are from the pipe making, machine building and construction industries.
Over the last five years their aggregate share in MMK’s sales has increased from 51 % to 68 %.
8%
MMK 2010 market share
MMK 2011 market share

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Pipe Making Industry
Russian pipe makers accounted for 33 % of MMK’s sales in 2011, down from the high of 37 % reached in
2009-2010. MMK’s steel products made up 29 % of consumption by pipe making companies.
In 2011 pipe makers and steelmakers alike were affected by growing imports. According to the Ministry
of Industry and Trade, the 17 % growth of pipe consumption in Russia was only partially covered by a 9 %
increase in production. In 2011 pipe imports increased by 20 %, while export volumes remained unchanged.
10,000
5,000
6,000
5,000
4,000
3,000
2,000
1,000
0
Production growth +9%
2010
MMK Domestic Sales by Sector, ‘000 tonnes
20%
29%
4%
27%
20%
16%
27%
6%
24%
26%
11%
26%
11%
15%
37%
2007 2008 2009 2010 2011
2011
12%
18%
12%
21%
37%
Consumption
growth
+17%
12%
20%
14%
21%
33%
Other
Regional distribution
Construction
Machine building
Pipe making
Pipe consumption in Russia
Russian pipe production
Pipe exports
Pipe imports
Consumption of Russian-made pipes
The highly profitable market for large diameter pipes shrank in 2011. Pipe production decreased by
119,000 tonnes (–3.9 %), and pipe consumption by 48,000 tonnes (–1.4 %). Both imports (+155,000
tonnes) and exports (+83,000 tonnes) increased year-on-year.
Faster import growth is currently held in check by customs duties of 15-20 %. However, with ratification
of the WTO Protocol, import duties will decrease to 0-10 %, including during the transition period.
These developments mean that, in the coming years, competition and quality requirements for pipe
makers and plate manufacturers will increase.
Machine Building
In 2011, the share of shipments to the machine building sector remained unchanged from 2010 at 21 %.
Product volumes amounted to 1.4 million tonnes, with 42 % going to the railway car building industry
and 34 % to the automotive sector.
The railway car building sector has grown rapidly in recent years. In 2010 rolling stock manufacturing
capacity doubled, and in 2011 it expanded by a further 24 % to 63,000 railway cars. According to Russia’s
Railway Transport Development Strategy 2030, annual demand for new railway cars will exceed 70,000
units by 2015.
Meeting demand from transport companies means that railway car builders fully utilize available
manufacturing capacity, and consequently that MMK’s sales to companies in the sector will remain at a
high level.
The Russian automotive sector also grew quickly in 2011. Truck production increased by 33 % to about
200,000 units, and car production rose by 44.5 % to 1.7 million units.
Car sales increased by 39 %, reaching 2.6 million units in 2011. In 2012 car sales are forecast to continue
growing, reaching a total of 2.8 million units.
The Russian government’s moves to increase production, and the level of localization of manufacturing,
by foreign automakers in Russia are likely to lead to further production growth and increased
consumption of Russian steel products by car makers.
In 2011 MMK shipped 13.5 % more steel products to car makers than in 2010.
The automotive sector accounted for 7 % of MMK’s domestic shipments of steel products by volume in
2011, up from 6.4 % in 2010. MMK’s biggest customers in the sector are AvtoVAZ, KamAZ and the GAZ
Group.
MMK is actively developing new product types for the automotive sector. The Company has adopted
and is implementing a certification programme for its steel products by Russian and foreign car makers,
under which seeks to have its processes and products approved by leading global car makers (including
Ford Motor Company, General Motors, Volkswagen, Renault-Nissan, Hyundai-Kia) as well as Russian
producers (such as AvtoVAZ). The certification programme also covers component producers based in
Russia.
28 29

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Construction Sector
The relatively sluggish activity seen in the construction sector in 2010 persisted in the first half of 2011,
but the third quarter saw a positive trend in investments.
In total, according to the Ministry of Economic Development, construction increased in value terms by
5.1 % year-on-year.
Housing construction totalled 62.3 million sq m, 6.6 % up on 2010 (compared to a 2.4 % year-on-year
decline in 2010).
Consumption of long products in the construction sector increased by 16.6 % in 2011 year-on-year, while
total shipments of long products by MMK increased by 27 %.
Outlook
Forecasts suggest that Russia’s steelmaking sector will continue its fast growth in the coming years,
with steel consumption in the country likely to increase by 14 % by 2013 compared to the level of 2011.
An important growth factor will be direct and indirect government spending, such as record military
orders and higher volumes of housing and infrastructure construction.
Significant funds spent on providing social services and improving living standards should increase
domestic demand for durables.
Ongoing construction of facilities for “national projects” – in particular the 2013 World University
Games, the 2014 Olympic Winter Games and the football World Cup in 2018 – will also contribute to
demand for steel products.
Export
In 2011 export shipments increased by 8 % year-on-year.
Demand from the Middle East was a major source of export growth. Shipments increased by 44 %, and
as a share of MMK’s total exports the region increased from 48 % to 64 %. Key countries for MMK in the
region are Iran (47 % of total export volumes) and Turkey (11 %).
MMK Exports by Region, ‘000 tonnes
Shipments to Asia and the Far East fell due to the growth of domestic steel production in those countries.
Exports to China and India over the last three years have reached their lowest historical volumes. In
2011 MMK’s largest customer in the region was Vietnam, accounting from 5 % of total exports. Further
development of the local steelmaking industry may close this market for us.
In 2011, shipments to Europe fell by just 40,000 tonnes despite the economic slowdown and shutdowns
of steelmaking plants in the region. The biggest European buyer of MMK’s products is Italy (9 % of total
exports).
Key Importers of MMK Steel Products, ‘000 tonnes
Key export products are hot rolled products (81 %). High value added products account for 9 % of
exports.
30 31
5,000
4,000
3,000
2,000
1,000
0
3,000
2,500
2,000
1,500
1,000
500
0
25%
12%
50%
29%
20%
38%
11%
35%
43%
20%
19%
48%
18%
10%
64%
2007 2008 2009 2010 2011
14%
9%
7%
6%
7%
27%
7%
11%
8%
33%
9%
11%
47%
2009 2010 2011
Vietnam
India
China
Brazil
Italy
Turkey
Iran
Central and Latin America
Africa
North America
Europe
Asia and Far East
Middle East

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32 33
New technology,
new potential
93, Ul.Kirova, Magnitogorsk, Russia. Tel.: 8-800-775-000-5 (toll free in Russia). Fax: (3519) 24 73 09
www.mmk.ru

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Financial review
MMK Group Financial performance
12,000
10,000
8,000
6,000
4,000
2,000
0
Revenue, USD million
Last year the global economy continued its gradual recovery from the recession of 2008–2009.
Thanks to increased demand for durable goods and rising capital investments, demand for steel from
key consuming industries (construction, machine building, automotive, etc.) rose. Implementation of
infrastructure projects initiated during the recession also helped to support demand.
We expect that the global economy will continue growing in 2012, which will have a positive effect on
steel demand. As a result, we believe that the Company’s revenue may approach pre-crisis levels.
Analysis of y-o-y Change in MMK Group Revenue, USD million
10,000
8,000
6,000
4,000
2,000
0
7,719
8,197
2010
Revenue
10,550
2007 2008 2009 2010 2011
251
Change
in sales
volumes
5,081
1,229
Change
in product
prices
7,719
107
Other
factors
9,306
9,306
2011
Revenue
In 2011 revenue from sales stood at USD 9,306 million (up 21 % from 2010). Revenue rose mainly due to
higher sales volumes and prices.
2011 Revenue Structure by Product Type
Revenue Structure by Segment, USD million
Segment 2010 2011 Change Change, %
Steel segment (Russia) 7,425 8,736 1,311 18 %
Steel segment (Turkey) 137 417 280 204 %
Coal segment 157 153 (4) –3 %
Total 7,719 9,306 1,587 21 %
The Russian steel segment accounts for the majority of MMK Group’s revenue (94 %). Significant
progress on ramping up production in Turkey helped revenue from the Turkish steel segment increase
by over 200 %, with the segment’s share of Group revenue reaching 4 %. The coal segment accounts for
just around 2 % of Group revenue due to the fact that the majority of this segment’s output is consumed
within the Group.
34 35
5%
11%
3%
9%
12%
60%
Flat products
Long products
Coated products
Metalware
Cold-formed products
Others

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100 %
90 %
80 %
70 %
60 %
50 %
40 %
30 %
20 %
10 %
0 %
2010 2011
Other costs
Mine drifting
Wages and insurance
Depreciation
Raw and input materials
In 2011 production costs stood at USD 7.8 billion (up 30 % from 2010). Costs rose due to higher sales
volumes, indexation of prices for products and services provided by natural monopolies (energy tariffs
and railway rates) and significantly higher raw materials prices. Rising prices were partially mitigated by
MMK Group’s vertical integration in the coal concentrate industry. The Company’s partial self-sufficiency
in electricity production also offset the effect of rising electricity prices.
General running and
administrative costs
MMK Group Production Cost Breakdown
Commercial and Administrative Costs, USD million
Percentage of revenue 6.4 % 6.0 %
2010 2011 Сhange Change (%)
495 560 65 13 %
Commercial costs 565 499 –66 –12 %
Percentage of revenue 7.3 % 5.3 %
In 2011 general running and administrative costs increased by 13 %, although as a proportion of revenue
they fell to 6.0 %. Commercial costs decreased by 12 %, and accounted for a smaller share of revenue in
the second half of the year.
MMK Group EBITDA Calculation, USD million
36 37
2010 2011
Operating profit 610 365
Adjustments for EBITDA
calculation
— —
Depreciation and amortization 826 887
Losses from write off of fixed
assets
Share in income of related
companies
159 70
11 14
EBITDA 1,606 1,336
EBITDA margin, % 21 % 14 %
In 2011, EBITDA totalled USD 1,336 million (down 17 % on 2010), with an EBITDA margin of 14 %
(compared to 21 % in 2010).
MMK Group EBITDA by Segment, USD million
2010 2011 Change
EBITDA 1,606 1,336 (270)
Steel segment (Russia) 1,347 1,187 (160)
Steel segment (Turkey) (11) (66) (55)
Coal segment 270 222 (48)
The Russian steel segment historically accounts for most of the Group’s EBITDA (89 % in 2011). The coal
segment accounted for a further 17 % of EBITDA. The Turkish steel segment recorded negative EBITDA
as the project has not yet reached full production capacity and target performance.

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The change in EBITDA was mainly due to revenue growing at a slower rate than production and
operating costs.
MMK Group Net Income, USD million
2010 2011 Сhange
Operating profit 610 365 (245)
Financial expenses (140) (190) (50)
Financial income 8 15 7
Exchange rate differences (24) (118) (94)
Other income and expenses (164) (213) (49)
Profit (loss) before tax 290 (141) (431)
Income tax (58) 16 74
Profit (loss) for the reporting period 232 (125) (357)
Attributable to minority interests (22) (5) 17
Attributable to shareholders of the parent
company
Analysis of y-o-y Change in MMK Group EBITDA, USD million
3,000
2,500
2,000
1,500
1,000
500
0
1,606
2010
EBITDA
63
MMK's
production
volume
1,229 -919
Price
of MMK's
products
Price
of raw
materials
-539
Other
factors
-48 -55
Change
in Belon's
EBITDA
Change
in EBITDA
of MMK-Metalurji
1,336
2011
EBITDA
254 (120) (374)
The increase in financial expenses was due to borrowed funds raised for business development. Other
costs rose mainly due to an increase in social tax payments.
The negative exchange rate difference of USD 118 million had a significant influence on financial
performance in 2011.
The Company recorded a net loss of USD 125 million for the period, of which USD 120 million was
attributable to shareholders of the parent company.
Steel production
unit of
measure
Thousand
tonnes
Russia steel segment
38 39
2010 2011 Сhange Change (%)
10,253 10,653 400 4 %
Revenue from sales including USD million 7,436 8,914 1,478 20 %
Sales to the Group’s
companies
USD million 11 178 167 в 17 x
Third parties USD million 7,425 8,736 1,311 18 %
EBITDA USD million 1,347 1,187 –160 –12 %
EBITDA margin % 18.1 % 13.3 % –4.8 %
EBITDA per ton of steel
products
USD/t 131 111 –20 –15 %
Capital expenditures USD million 1,451 859 –592
The Group’s financial performance is substantially driven by the Russian steel segment, which includes
OJSC MMK and its steel producing subsidiaries in Magnitogorsk; MMK-METIZ Metalware and Sizing Plant;
the downstream steel processing plants MMK-Profil-Moskva and Intercos-IV; and trading companies.
Thanks to improved market conditions, in 2011 revenue from sales to third parties rose by 18 % year-onyear
to USD 8,736 million.
In 2011, capex in the steel segment was USD 859 million, or 74 % of total investments. Capital
expenditure focused on construction of the cold-rolling complex and other projects at the Magnitogorsk
production site.

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Turkish steel segment
unit of measure 2010 2011 Сhange
Thousand
tonnes
156 505 349
Revenue from sales including USD million 138 458 320
Sales to the Group’s
companies
USD million 1 41 40
Third parties USD million 137 417 280
EBITDA USD million –11 –66 –55
EBITDA margin % –8.0 % –14.4 % –6.4 %
EBITDA per ton of steel
products
USD/t –71 -131 –60
Capital expenditures USD million 658 176 –482
The Turkish steel segment includes ММК Metalurji, a steel producer located at two sites in Turkey:
Iskenderun and Istanbul.
Output and sales revenue were both several times higher than in 2010 due to progress made on bringing
the project towards full capacity. However, the segment’s financial performance remained negative.
Target indicators are expected to be reached in 2012, resulting in positive financial performance.
Steel production
unit of
measure
Thousand
tonnes
Coal segment
2010 2011 Сhange Change (%)
2,960 3,216 256 9 %
Revenue from sales, of which USD million 556 649 93 17 %
sales to Group companies USD million 399 496 97 24 %
sales to third parties USD million 157 153 –4 –3 %
EBITDA USD million 270 222 –48 –18 %
EBITDA margin % 48.6 % 34.2 % –14.4 %
EBITDA per ton of steel
products
USD/t 91 69 –22 –24 %
Capex USD million 100 119 19
The coal segment includes OJSC Belon and its coal producing and dressing subsidiaries (Belon Group). All
of Belon Group’s material assets, production facilities and management and administrative resources are
located in Belovo, Russian Federation.
Most of the coal segment’s output is supplied to Belon Group’s parent company (OJSC MMK).
Segment EBITDA was USD 222 million, with a margin of 34 %. Despite a considerable increase in prices
for coal concentrate, the segment’s financial performance remained almost unchanged due to the large
amount of pre-production mining work carried out during the reporting year.
MMK Group Working Capital, USD million
40 41
01.01.11 01.01.12 Change Change (%)
Inventory 1,236 1,776 540 44 %
Uncompensated VAT 213 304 91 43 %
Receivables 828 700 (128) –15 %
Payables (971) (1,180)* (209) 22 %
Total working capital 1,306 1,600 294 23 %
*excluding the part of debts, related to indebtedness.
In the reporting period, the Group’s working capital grew by 22 % to USD 1,600 million, driven mostly by a
USD 540 million increase in inventory. Changes in the receivables and payables reduced working capital by
USD 128 million and 209 million, respectively.
Working Capital Productivity Indicators
01.01.11 01.01.12 Change Change (%)
Turnover period, days
Inventory 75 82 7 9 %
Receivables 39 27 (12) –30 %
Payables 49 48 (2) –5 %
Working capital, % of revenue 17 % 17 % 0%
The inventory turnover period slightly increased, while receivables turnover decreased considerably,
from 39 to 27 days, and payables turnover decreased insignificantly. As a result, working capital growth
of 23 % was comparable with revenue growth, and at the end of 2011 the working capital/revenue ratio
was the same as at the start of the year.

2011 /
as of
31.12.2010
as of
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Analysis of y-o-y Change in MMK Group Cash Flow, USD million
1,600
1,400
1,200
1,000
800
600
400
200
0
515
Cash and Cash
Equivalents
(01.01.2011)
0 1,000 2,000 3,000 4,000 5,000
Long-term Short-term
578
Operating
activities
426
Financial
activities
-1,128
as of
31.12.2010
as of
31.12.2011
33
Investments Exchange
rate
difference
424
Cash and Cash
Equivalents
(01.01.2012)
In 2011, cash flow from operating activities was USD 578 million, lower than in 2010 due to a reduction
in operating profit and to the growth in working capital.
In 2011, cash outflow due to investment activities was USD 1,128 million (44 % down on 2010). Most of
the cash outflow (USD 1,154 million) was attributable to capital expenditure.
In 2011, USD 426 million was raised from financial activities (63 % down on 2010). Financial activities
comprise raising and repayment of loans (USD 3,358 million and USD 2,350 million, respectively),
acquisition of 50 % of the shares of MMK-Metalurji (USD 475 million) and payment of dividends (USD 122
million).
Debt Structure
0 1,000 2,000 3,000 4,000 5,000
Rubles US dollars Euro
In 2011, the Company’s total debt, including leasing debt, increased by USD 868 million. This was largely
due to an increase of USD 629 million in long-term debt. Short-term debt increased only insignificantly,
and the Company has been able to maintain a high level of financial stability.
As of 1 January 2011, dollar-denominated borrowings accounted for the largest part of the debt structure
by currency, at 45 %. However, this share declined during the year as the share of rouble-denominated
debt increased to 34 % from 28 % as a result of MMK’s policy to mitigate the effect of exchange rate
fluctuations on the Company’s financial position.
Credit ratings
In May 2011, Fitch raised MMK’s credit rating from BB to ВВ+ (stable outlook).
In December 2011, Moody`s changed the Company’s rating outlook to stable from positive, returning it to
the same level as the beginning of 2010.
Prudent financial management helps the Company to secure credit ratings from leading ratings agencies,
and thus to finance the Company’s development using appropriate funding on acceptable terms.
42 43
Agency
Moody`s
Fitch
Rating
Ba3
ВВ+
ВВ
Outlook
P
S
N
P
S
N
P
S
N
Jan
Feb
Mar
Аpr
May
June
2010 2011
July
Aug
Sept
Oct
Nov
Dec
Jan
Feb
Mar
Аpr
May
June
July
Aug
Sept
Oct
Nov
Dec
Jan
2012
Feb
Mar

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Risk Management
MMK was among the first Russian ferrous metals companies to develop and launch a comprehensive
risk management system that meets international standards. MMK has a risk management division, an
approved risk management policy and a corporate standard for risk management.
By managing risk appropriately, MMK aims to ensure strategic and operational sustainability and to
develop its business.
The goals of MMK’s risk management policy are:
• Identifying and assessing risk;
• Provision of information about risks to MMK’s shareholders, governing bodies and employees;
• Development and implementation of actions to mitigate risks;
• Risk monitoring;
• Establishment of risk management procedures;
• Control of compliance with approved risk management procedures;
• Making risk management processes an integral part of MMK’s strategic and operating management.
MMK keeps its risk management system updated and makes improvements on a rolling basis. In 2011,
the Company implemented the following measures:
Development and subsequent approval by the Board of Directors of a new version of the MMK Risk
Management Policy;
• Identification and evaluation of the principal risks faced by MMK Group companies (work on
consolidating the risks facing MMK Group companies and drafting of a Risk Map is planned for
2014);
• Completion of the introduction of a Comprehensive Risk Management System at MMK’s production
sub-divisions;
• Introduction of a multi-faceted approach to evaluating risks of building and structural failure;
• Improvement of risk management procedures regarding non-fulfilment of payment obligations for
steel products;
• To mitigate the risk of production stoppages, the CEO approved the list of plants considered
production bottlenecks. A reserve stock of spare parts has been established for these plants.
The main risks faced by MMK are the following:
1. Low actual demand and prices for steel products
2. Higher prices for iron ore raw materials, coal, metallic scrap and non-ferrous metals
3. Failure by contractors to meet obligations
4. Non-compliance with financial and economic parameters specified in investment and
integration projects
5. Claims for loan prepayments
6. Corporate fraud
7. Currency risk
8. Claims for recovery under guarantees issued to third parties
9. Accidents
10. Industrial emergencies and incidents
11. Interest risk
12. Environmental risk
A senior manager has been appointed to manage each risk identified, and appropriate risk mitigation
measures have been developed based on a risk evaluation
MMK’s Board of Directors assesses the performance of the Company’s Comprehensive Risk Management
System annually based on the results of each year.
The Board of Directors
The Audit Committee
of the Board
of Directors
The General Director
of MMK
Top managers
responsible
for risk management
Risk management group
of the Internal Audit
and Risk Management
Department
Sub-divisions
of OJSC MMK
Distribution of duties among main participants in risk management process
Approval
of Risk Map
Development
of Risk Map
Drawing up of Panels
and Risk Maps
for sub-divisions
Appointment
of persons responsible
for risk management
Development
of risk mitigation
activities
Development
of risk mitigation
activities
44 45
Approval
of risk mitigation
activities
Preparation
of Risks Report
Approval
of Risks Report,
Risk Management Policy,
evaluation of efficiency
of risk management
Review
of Risks Report

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46 47

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Social Responsibility
As a socially oriented company, MMK is concerned about the interests of society. This concern goes well
beyond what is required by law, as the Group takes considerable measures to provide a higher standard
of living to its employees and their families, the local community and society as a whole.
In 2011, MMK spent USD 96 million on a variety of social programmes, which is USD 19 million more
than in 2010. The parent company (OJSC MMK) allocated a further RUB 2.1 billion (USD 73 million) for
the implementation of the Group’s social policy in 2011, including for the sponsorship of Metallurg Ice
Hockey Club.
Health and medical care programmes
Medical care programmes are the mainstay of the Company’s social policy. The Company spent RUB 367
million to implement preventive health care and treatment programmes, which is RUB 14 million more
than in 2010.
Improving the health of employees and their families
In 2011, 16,100 employees and their families spent their vacations in health resorts and vacation
facilities, with 50 % of them receiving spa treatment. The Company contributed RUB 310 million towards
covering the cost of these vacations, which is 30 % more than in 2010.
Maternity support and birth rate stimulation programme
MMK has been implementing a maternity support and birth rate stimulation programme for eight years.
In 2011, the Company spent RUB 35.6 million on this programme (up from RUB 34 million in 2010).
Since 2008, MMK has also had a programme to support employees with large families (with three or
more children under 18 years old). In 2011, the programme included 216 families, with a cost of RUB 7.1
million.
Housing programme
In 2010, MMK completed the construction of a 17-storey building comprising 112 apartments with a
total area of 6,410 m 2 and began construction of an additional multi-storey block which will comprise
202 apartments with a total area of 13,200 m 2 . MMK has a programme to assist young steel-makers'
families in purchasing apartments. Every year 30 young families receive subsidies worth RUB 80,000
each and are entitled to purchase a one-room apartment at a subsidized price.
Sports
In 2011, the Company spent RUB 106 million arranging mass entertainment sporting events.
Charity
MMK conducts its charitable activities through the Metallurg Charity Foundation. In 2011, the Metallurg
Foundation received contributions for a total of RUB 423 million, over 92 % of which came from MMK
Group.
Labour safety
The corporate labour and industrial safety management system was certified for compliance with the
international ОНSAS 18001: 2007 standards (2008). In 2011, under the Labour Safety Agreement 86, a
number of steps aimed at improving labour conditions and preventing occupational diseases were taken.
Accidents in production, operation, construction, maintenance, overhauls, and modernization of facilities
48 49
2010 2011
Total accidents 19 21
Total persons affected 19 21
Fatal accidents 3 0
Accidents resulting in severe injuries 4 9
Frequency rate 0.886 0.987
Severity rate 63.29 56.85
Labour safety costs, RUB million
Description 2010 2011
Provision of personal protective gear 146.1 173.6
Purchase of polyvitamins and dietary products for employees working
in hazardous conditions
16.4 18.4
Laboratory tests for workplace certification 17.9 19.3
Purchasing of bottled mineral water for employees working in hot
environments
Special dietary products for employees working in hazardous
conditions
11.9 54.2
2.2 2.4
Other labour safety costs 211.2 219.1
Total 405.7 487.0

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Environmental Protection
MMK carries out its production activities in accordance both with Russian environment protection laws
as well as the ISO 14001:2004 international standard.
MMK views the minimization of its impact on the environment as a strategic goal and a key element of
the Company’s long-term, sustainable growth.
In 2011, MMK’s Environmental programme produced the following positive results:
• gross pollutant emissions into the atmosphere were reduced by 0.35 thousand tonnes (0.2 %) to
220.5 thousand tonnes;
• emissions of iron, manganese and fluoride into water bodies were reduced, respectively, by 4.8
tonnes (14 %), 3.1 tonnes (16.9 %) and 124.4 tonnes (31.4 %);
• the volume of waste in the sintering division increased by 5 % to 2.29 million tonnes;
the share of recycled water amounted to 97.5 % of total water consumption for industrial purposes.
MMK does not specially monitor the emission of ozone-depleting substances produced in its operations.
Discharge of Main Pollutants into the Atmosphere Discharge of Main Pollutants into
Bodies of Water
Pollutant
Discharges
in 2010,
tonnes
Discharges
in 2011,
tonnes
Particulate matter (dust) 25,511.9 26,365.3
Sulphur dioxide (SO2) 17,251.8 16,198.3
Nitrogen dioxide (NO2) 16,037.6 15,651.0
Carbon oxide 153,544.5 153,632.5
Ammonia 440.8 444.1
Hydrogen sulphide 59.6 60.9
Phenol 96.0 96.2
Other 7,932.6 8,072.6
Total discharge 220,874.8 220,520.9
Pollutant
Discharge
in 2010,
tonnes
Discharge
in 2011,
tonnes
Total Ferrum 34.1 29.4
Mn 18.6 15.5
Petroleum products 59.9 62.7
Sulphates 46,198.5 51,388.3
Dry residual 396.1 271.7
Fluorides 46.8 53.6
Other 92,129.5 104,045.4
Total discharge 138,883.5 155,866.6
Air Polluting Emissions
In 2011, MMK disposed of sewage from 7 outlets into 3 surface water bodies:
• within the city limits from the cooling water recirculation system into the Magnitogorsk Reservoir –
(251,208.0 thousand m3 );
• within the city limits from the Co-Generation Plant's ash dump into the Magnitogorsk Reservoir –
2,890.0 thousand m3 ;
• from sludge depository No. 2 into the Sukhaia River (a fish breeding body of water) –
4,181.0 thousand m3 ;
• quarry water from the limestone mine into the Ural River (a fish breeding body of water) –
23,412.74 thousand m3 ;
• quarry water from the dolomite mine into the Ural River – 3,908.62 thousand m3 ;
• from the crushing and calcination plant into the Ural River – 519.6 thousand m3 ;
• within the city limits from the Co-Generation Power Plant's cooling system into the Magnitogorsk
Reservoir – 78,105.68 thousand m3 .
50 51
000 tonnes
260
250
240
230
220
210
200
254.60
22.12
248.30
20.20
Blue
skies
20.93
230.90
25.92
229.1
21.35
220.87
20.44
220.52
2006 2007 2008 2009 2010 2011
Emissions into atmosphere, 000 tonnes Specific total emissions, kg/tonnes
30
25
20
15
10
5
0
Kgs per tonnes

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MMK’s water protection strategy focuses on maximizing the use of recycled water for its water supply
systems. In 2011, the share of recycled water accounted for 97.5 % of the total water supply for
industrial purposes.
2006
2007
2008
2009
2010
MMK’s Water Supply and Consumption Use of MMK’s Industrial Waste
0.112
0.109
0.110
0.111
0.088
2011
0.089
0 0.5
3.06
2.95
3.02
2.91
2.98
2.87
2.82
2.71
3.31
3.22
3.49
3.40
1.0 1.5 2.0 2.5 3.0 3.5
The use of industrial waste in the production and reclamation of exhausted ore mining pits is a key
priority for MMK. The total capacity of slag processing facilities at present is 11.5 mtpy. The total volume
of MMK's metallurgical slag dumps exceeds 60 million tonnes. Given the current production levels, these
slag dumps should be fully processed within 6-9 years.
Hazardous waste category Waste disposal in 2010, tonnes Waste disposal in 2011, tonnes
1 Class 0 0
2 Class 0 0
3 Class 31,630.8 29,558.4
4 Class 98,975.6 89,589.9
5 Class (without gangue) 1,085,570.1 1,353,200.5
Total (without gangue) 1,216,176.5 1,472,348.8
5 Class (gangue) 30,091,792.0 32,378,687.0
MMK does not engage in the cross-border transportation or collection of waste (in accordance with the
Basel Convention).
As part of its 2011 Environmental Programme, MMK implemented 32 specific measures aimed at
reducing or preventing the environmental impact of the Company’s operations.
2006
Industrial Waste Disposal
1.49
2007
1.14
2008
1.09
2009
2010
2011
0
2.05
2.18
2.29
4.80
5.09
5.55
6.89
6.66
8.42
8.54
9.39
9.13
9.30
11.60
10.54
5 10
15
Total slags processed (current and dumped slags), million tonnes
Wastes and slags used for reclamation of abandoned open-pit mines
of the Magnitnayamountain, million tonnes
tonnes
Key environmental protection measures implemented in 2011:
The cost of environmental protection measures in 2011 amounted to RUB 2,085.69 million, out of which:
• RUB 174.56 million was spent on the reduction of pollutant emissions into the atmosphere;
• RUB 1901.0 million was spent on the reduction of pollutant emissions into bodies of water;
• RUB 10.13 million was spent on industrial waste disposal.
52 53
52 53
No.
1
2
3
4
5
6
Structural
division
Ore Dressing
Plant
Rolling
shop # 11
Rolling
shop # 11
Rolling
shop # 11
Rolling
Shop # 4
Rolling
Shop # 4
Action
Increase of volume of sludge
depository # 2
Construction of a facility to
reduce water wastage
Construction of a water
circulation system
First stage construction of
four aspiration systems
Construction of a "clean"
cycle of the water circulation
system to cool the reheating
furnaces
Construction of a "dirty"
cycle of the water
circulation system (including
sludge pumping stations
and horizontal flow
sedimentation basins)
2011
RUB million
Total from
start of
construction
47.3 323.7
491.5 512.4
731.6 958.4
10.9 10.9
124.6 124.6
492.9 1,192.3
Environmental efficiency
Maintaining technical parameters
of the operation of a wastewater
treatment facility
Prevention of input of 250 m 3 /
hour of polluted flows into the
water circulation system
Reducing the consumption of
industrial water by 12,500 m 3 /h
Prevention of discharge of 80 t/y
of mineral oils
Reducing the consumption of
industrial water by 2,250 m 3 /h
Reducing the consumption of
industrial water by 14,000 m 3 /
hour, reducing the discharge of
suspended substances by 1,660
t/year, oil products by 220 t/year
Green
grass

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MMK’s expenditure on environmental protection
in 2011:
Cost description
Amount,
RUB m
Capital construction 2,023.6
Overhauls 65.9
Maintenance (current repairs
and operational costs)
R&D in environmental
protection
1,795.6
1.6
Total 3,886.7
54
Cost of environmental protection measures, RUB m
In total, MMK spent RUB 3,886.7 million in 2011 on environmental protection.
The cost of building new, and renovation existing, environmental facilities amounted to RUB 2,023.6 million
during the year.
Description
Use of Power Resources
Unit of
measure
Quantity
Amount,
'000 RUB
Price, RUB
Electric Power, total '000 kWh 7,091,003 10,111,347 1,425.9
Electric Power Generation 5,147,814 5,907,256 1,147.5
Purchased Electric Power 1,943,189 4,204,091 2,163.5
Thermal Power, total Gcal 6,359,217 3,502,926 550.8
Thermal power in hot water Gcal 921,414 495,466 537.7
Thermal power in steam Gcal 5,437,803 3,007,460 553.1
Natural gas '000 m 3 4,339,304 11,671,423 2,689.7
Power-generating coal t 94,113 251,634 2,673.7
Diesel-fuel oil l 36,691,170 738,636 20.1
2007
2008
2009
2010
2011
0
1,906
2,240
2,433
2,607
500 1,000 1,500 2,000 2,500 3,000
3,887
3,500 4,000
93, Ul.Kirova, Magnitogorsk, Russia
Tel.: 8-800-775-000-5 (toll free in Russia)
Fax: (3519) 24 73 09
www.mmk.ru
Building
a multicoloured
world!

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Harnessing steel
Products for the automotive sector
www.mmk.ru
56 57

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Corporate Governance
Corporate Governance Objectives:
MMK maintains high standards of corporate governance. The company’s strong governance, combined
with its solid financial performance, makes it a reliable partner for investors.
The overall objective of MMK’s corporate governance is to increase the Company’s value while balancing
the interests of all stakeholders.
The Company seeks to achieve this objective by:
1. Protecting the rights and interests of all shareholders;
2. Ensuring transparency of information on the Company’s activities;
3. Establishing a governance structure to support the Company's strategic management, as well as to
oversee and ensure accountability of the management;
4. Building trusted relations with all key stakeholders including shareholders, suppliers, customers and
employees.
MMK’s corporate governance guidelines and procedures are set out in the Company’s Corporate
Governance Code (posted on MMK’s official website: http://www.mmk.ru/corporate_governance/
internal_documents/code_of_corporate_governance, as approved by the Board of Directors on 21
September 2001.
In 2011, MMK’s Charter was revised and supplemented as follows:
The governance structure was changed. The Company does not have a collective executive body in the
form of a Management Board. The governance structure includes the General Shareholders’ Meeting,
Board of Directors and the Individual Executive Body (General Director).
The criteria for determining Directors’ independence are in accordance with the UK Corporate
Governance Code.
Certain responsibilities were shifted from the General Director to the Board of Directors. The Board’s
responsibilities now include adoption of resolutions on transactions exceeding 0.3% of the book value of
the Company’s assets, and approval of the Company’s organizational chart.
Due to amendments to the Federal Law “On Joint Stock Companies” coming into effect, the dividend
payment period was changed. Previously annual dividends were paid by the end of the year, while
interim dividends were paid within 180 days of the decision to pay the dividends. According to new
provisions, dividends are to be paid to all shareholders at the same time and within 60 days of a
resolution by the shareholders’ meeting to pay dividends.
The number of Audit Committee members was changed from 3 to 12.
The Charter states that the Head of the Audit Committee is accountable to the Board of Directors.
To enhance operations further, the Company also adopted a Code of Business Ethics, approved by the
Board of Directors on 17 July 2009. The Code of Business Ethics and other corporate bylaws can be found
on the Company’s website at: http://www.mmk.ru/corporate_governance/internal_documents/.
Auditor
Corporate
Secretary
Internal
Control
Department
Committee
for Audit
(Independent
Directors)
The General Shareholders’ Meeting is the supreme governance body.
The Board of Directors is in charge of managing the Company’s activities (except for matters for which
the General Shareholders’ Meeting has responsibility), and it is also responsible for overseeing the
implementation of resolutions adopted by the Board of Directors or General Shareholders’ Meeting.
The Individual Executive Body, which is the Company’s General Director, is in charge of the Company’s
day-to-day operations.
In accordance with Russian legislation and international standards, an independent Auditor and the
Audit Committee supervise the Company’s financial and economic activities.
MMK’s Corporate Governance Rating
General Shareholders' Meeting
Board of Directors
Chairman
of the Board of Directors
BoD Members
(10 members including 5
Independent Directors )
Committee
for Nominations
and Remuneration
(Independent
Directors)
Единоличный Individual исполнительный Executive Body
орган -
Генеральный – General Director
директор
In July 2011, the consortium of the Russian Institute of Directors and Expert RA Rating Agency increased
MMK's corporate governance rating to 8 (on a scale of 1-10), indicating “advanced corporate governance”
in accordance with the National corporate governance scale. MMK was considered to observe relevant
corporate governance legislation, while also adhering to most recommendations of the Russian Code of
Corporate Conduct and being in line with many aspects of best international corporate governance practice.
58 59
BoD
Secretary
Committee
for Strategic
Planning
and Corporate
Governance
Audit
Committee

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General Shareholders’ Meeting
The General Shareholders’ Meeting is the
Company’s supreme governance body.
А Shareholders who own not less than 2 % of the
Company’s ordinary voting shares are entitled
to propose issues for the agenda of Annual
General Shareholders’ Meetings and to nominate
candidates to the Company’s Board of Directors
and Audit Committee whose number shall not
exceed the number of members of that body,
and candidates for the position of the individual
executive body. Such proposals must be submitted
to the Company not later than 40 days following
the end of the financial year.
A notice of the General Shareholders’ Meeting
must be sent to each person specified in the list
of persons entitled to participate in the General
Shareholders’ Meeting by registered mail not
later than 30 days before the date of the meeting
with an announcement being published in the
Magnitogorsky Rabochiy and Magnitogorsky
Metall newspapers.
The Company may additionally inform
shareholders of the General Shareholders’ Meeting
using other mass media (television and radio), and
by posting the notice on the Internet at:
http://www.mmk.ru/corporate_governance/
disclosure_of_information/materials_to_the_
shareholders_meeting/.
A registrar performs the functions of a counting
commission (CJSC STATUS).
Persons entitled to participation in the General
Shareholders’ Meeting to be conducted in the
form of a meeting must be registered at the venue
of the meeting starting at a time specified by
the Board of Directors, and until the close of the
meeting.
Voting on agenda items is conducted by means
of voting ballots. Voting ballots must be sent to
shareholders by registered mail not later than 30
days before the date of the meeting.
Resolutions adopted by the General Shareholders’
Meeting and voting results must be announced
at the meeting where voting takes place, and
persons entitled to participate in the General
Shareholders’ Meeting should be notified within
10 days of the preparation of minutes on the
voting results in the form of a report to be
published in the Magnitogorsky Rabochiy and
Magnitogorsky Metall newspapers.
International investors participate actively in
voting at MMK’s General Shareholders’ Meetings
through a system of proxies established by
depositary bank, The Bank of New York Mellon:
EGSM
21.01.2008
AGSM
25.04.2008
EGSM
29.08.2008
EGSM
12.02.2009
AGSM
22.05.2009
EGSM
25.12.2009
AGSM
21.05.2010
EGSM
20.01.2011
AGSM
20.05.2011
In line with best practice, MMK provides its shareholders (including owners of GDRs) with sufficient
time to cast votes at General Shareholders’ Meetings. According to the Company’s bylaws a notice of the
meeting and voting ballots shall be sent not later than 30 days before the meeting (Federal Law “On
Joint Stock Companies” calls for a 20-day notice period).
22.6
20.3
22.6
44.6
41.5
46.3
49.7
47.0
50.9
0 20 40 60
million GDR
80 100
GDR that participated in the voting
Total amount of GDR
77.9
81.7
79.7
81.4
82.3
82.4
83.4
83.5
83.2
AGSM - Annual General Shareholder's Meeting;
EGSM – Extraordinary General Shareholder's Meeting
Equity Capital (Shareholders’ Structure)
MMK’s authorized capital totals RUB
11,174,330,000 and is comprised of
11,174,330,000 ordinary registered shares with
a par value of 1 rouble each. All shares are placed
securities. The Company is entitled to place, in
addition to those already placed, ordinary shares
amounting to 26,299,840,577 shares, with a par
value of 1 rouble each (declared shares). Declared
ordinary shares grant the same rights as placed
ordinary shares.
* - Victor Rashnikov, Chairman of the OJSC MMK
Board of Directors, is a beneficiary of MMK’s
ordinary shares held by Mintha Holding Limited,
Fulnek Enterprises Limited and Mordoraco
Holdings Limited.
The last Annual General Shareholders’ Meeting
approved a new version of the Company’s Charter.
A newly elected Board of Directors included Victor
Rashnikov, Vitaly Bakhmetiev, Boris Dubrovsky,
Nikolay Lyadov and Oleg Fedonin. Additionally,
five Directors meeting independence criteria
set forth in the UK Corporate Governance Code,
became members of the Board of Directors,
namely David Logan, Zumrud Rustamova, Bernard
Sucher, Peter Charow and David Herman.
The Meeting approved new versions of the
Regulations on MMK’s Board of Directors and the
Regulations on the Individual Executive Body,
MMK’s General Director, and amendments and
additions to the Regulations on MMK’s Audit
Committee. The Meeting elected members of the
60 61
Shareholder
Share, % of
authorized
capital
Mintha Holding Limited* 42.4 %
Fulnek Enterprises Limited* 41 %
Mordoraco Holdings Limited* 2.6 %
The Bank of New York
International Nominees
7.5 %
Other shareholders 6.5 %
Total shares 100 %
MMK’s management is not aware of any shareholders holding over 5 % of the shares, other than those
disclosed above.
Review of MMK’s Annual General Shareholders’ Meeting Conducted on 20 May 2011
A report on the results of voting at the AGSM on 20 May 2011 can be found at:
Equity capital structure as of 09.04.2012
Audit Committee expanding its membership from
3 to 12 persons. According to a rotation principle,
KPMG was approved as the Company’s Auditor.
The Meeting approved the size of remuneration
and compensation to be paid to members of
the Board of Directors and Audit Committee for
performance of their duties in 2011-2012. The
total remuneration of the Board of Directors stood
at RUB 65 million, while remuneration of the Audit
Committee amounted to RUB 39 million. The
Meeting also approved related-party transactions.
According to the new version of the Charter
approved by the Meeting, the Company
undertakes to pay dividends to all shareholders
simultaneously within 60 days after the decision
to pay dividends is taken.

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Board of Directors
The Board of Directors has overall responsibility for the Company’s activities and oversees the
implementation of resolutions adopted by the General Shareholders’ Meeting and Board of Directors.
The Company’s Board of Directors consists of 10 members, five of whom are independent. The
Chairman of the Board of Directors is Victor Rashnikov.
On 20 May 2011, Boris Dubrovsky, Victor Bakhmetiev, Nikolay Lyadov, Bernard Sucher and David
Herman were elected to the Board.
Election of members of the Board of Directors:
Members of the Company’s Board of Directors are
elected by the General Shareholders’ Meeting by
cumulative voting for one term until the following
Annual General Shareholders' Meeting.
In line with best Russian and international
corporate governance practices, independent
directors have been elected to the Board of
Directors to enhance oversight, transparency and
the efficiency of the Company's governing bodies.
Independent directors include Peter Charow, Sir
David Logan, Zumrud Rustamova, Bernard Sucher
and David Herman.
In 2011, the Shareholders’ Meeting approved
the Regulations on MMK’s Board of Directors
with respect to independence criteria for Board
members. The criteria used by MMK are in line
with the UK Corporate Governance Code.
Specifically, members of the Board of Directors
shall be deemed to be independent directors if
they meet the following requirements:
– members who at the moment of election or for
a term of five years prior to it are not or have not
been officers or employees of the Company or the
Group’s companies;
– members who at the moment of election or for a
term of three years prior to it do not have or have
not had any material commercial relations with the
Company directly or as a partner, shareholder or a
member of governance bodies of an organization
involved in such commercial relations with the
Company;
– members who are not and have not been entitled
to any additional remuneration from the Company,
except for remuneration paid to members of the
Board of Directors; members who do not participate
in option plan(s) of the Company or in remuneration
scheme based on the Company’s performance;
members who are not members of the Company’s
pension fund (pension programs);
– members who are not closely related (spouses,
parents, children, full and half siblings, adoptive
parents and adoptees) to any member of the
Company’s Board of Directors or Individual Executive
Body;
– members who do not sit with other members of
the Company’s Board of Directors on the Boards
of Directors of other Companies and who do
not have similar significant relations with other
members of the Board of Directors of the Company
through participation in governance bodies of other
companies;
– members who have not formed part of the Board
of Directors of the Company for more than nine years
from the date of their initial election to this position.
To be nominated for election to the Board of
Directors, a candidate must have knowledge
sufficient for making strategic decisions, including
on issues related to environmental and social risks
and responsibilities.
Decision making
Board responsibilities are set out in the Company’s Charter, which is available at:
http://www.mmk.ru/corporate_governance/internal_documents/index.php.
A member of the Board of Directors, Audit
Committee, the Company’s Auditor or the General
Director may propose an item for inclusion in the
agenda of a meeting of the Board of Directors
in writing to the Chairperson of the Board of
Directors.
The quorum for holding a Board meeting is at
least half of the elected Board members.
In taking decisions at Company Board meetings,
each Board member shall have one vote.
Voting on agenda items at Board meetings shall
be open and by name.
It is prohibited to transfer votes from Board
members to other persons, including other Board
members.
Board decisions shall be taken by a majority of
Board members taking part in the meeting unless
otherwise provided for by the Law, the Company’s
Charter and relevant Regulations.
Remuneration of members of the Board of Directors
62 63
In determining the quorum and the voting results,
the Board shall take into account the opinion
of any Board member absent from the meeting,
submitted in writing.
Such a Board member shall submit his/her written
opinion to the Chairman of the Board prior to the
Board meeting.
The Board Chairman shall announce the written
opinion of such a Board member prior to voting on
each issue on the agenda.
In the event that a Board member who submitted
his/her opinion prior to the meeting is then
present at the meeting, his/her written opinion
shall be disregarded.
Criteria for determining the remuneration of Board members are set out in the Regulations on the
Procedure of Remuneration and Compensation of Expenses of Members of the Board of Directors:
http://www.mmk.ru/corporate_governance/internal_documents/group_documents/.
The size of remuneration and reimbursement of expenses of members of MMK’s Board of Directors are
approved by the General Shareholders’ Meeting on an annual basis according to recommendations made
by the Board of Directors.
The size of remuneration of MMK’s Board of Directors is specified in civil law contracts, and comprises
fixed remuneration for performance of their duties and additional remuneration for participation:
• in meetings of the Board of Directors;
• in adoption of a resolution by the Board of Directors by absentee voting or for provision of a
written opinion of an absent member of the Board of Directors.
ММК compensates documented expenses of members of the Board of Directors related to performance
of duties of a member of the Board of Directors (travel expenses including first and business class travel,
accommodation; taxi fares, communication and mail expenses).
Pursuant to Paragraph 2 of Article 64 of the Federal Law “On Joint Stock Companies”, members of
the Board of Directors may receive remuneration and/or reimbursement of expenses related to the
performance of duties of members of the Board of Directors during their term of office according to a
resolution of the General Shareholders’ Meeting. The size of such remuneration and compensation is
determined by the General Shareholders’ Meeting.

Members of the Board of Directors
(as of 1 January 2012):
Victor RASHNIKOV
(born in 1948) – Chairman of the OJSC MMK Board of Directors, President
of LLC MMK Managing Company; Russian citizen; member of the Board
of Directors since 2 February 1993; has represented the interests of an
OJSC MMK shareholder, Mintha Holding Limited; since 1999, President of
the Metallurg Ice Hockey Club; since 2001, member of the Management
Board of the Autonomous Non-Profit Organization Medical Care Unit of
the City Administration of Magnitogorsk and OJSC MMK; since 2005,
member of the Board of Directors of the World Steel Association (formerly
International Iron and Steel Institute); since 2008, member of the Management
Board of Directors of the LLC Continental Hockey League; since
2010, President of the Non-profit Partnership Konsortsium Russkaya Stal;
since 2011, President of the Administration Board of MMK Trading AG
and Chairman of the Board of Directors of MMK Metalurji Sanayi, Ticaret
ve Liman İşletmeciliği Anonim Şirketi; and member of the Chelyabinsk
Region’s Legislative Assembly.
Graduate of the Magnitogorsk Institute of Mining and Metallurgy (1974),
metallurgical engineer; graduate of the Magnitogorsk Academy of
Mining and Metallurgy (1993), manager; D.Sc (Technology); Professor.
Zumrud RUSTAMOVA
(born in 1970), Deputy CEO of OJSC Polymetall UK; Russian citizen; member
of the Board of Directors since 21 April 2006, proposed by the OJSC
MMK Board of Directors; since 2008, member of the Board of Directors
of OJSC Sheremetyevo International Airport; since 2009, member of the
Board of Directors of OJSC KHANTY-MANSIYSK BANK, and member of
the Board of Directors of OJSC Polyus-Zoloto, since 2011, member of the
Board of Directors of OJSC PIK Group.
Graduate of the Moscow Institute of Economics and Statistics in 1992.
Peter CHAROW
(born in 1954) – Vice-President of British Petroleum for Russia; member
of the Board of Directors of OJSC TNK-BP Holding; member of the Board
of Directors since 30 March 2007, proposed by the OJSC MMK Board of
Directors.
Education: 1977 – Bachelor of Arts in Political Science from Swarthmore
College, Pennsylvania, USA; 1981, 1986 – Master of Arts in Political Science,
Columbia University, New York, USA; 2006 – Executive MBA in 2006
from Tuck School of Business, Dartmouth College, New Hampshire, USA.
Sir David LOGAN
64 65
(born in 1943), since 2004, member of the Supervisory Board of Efes
Breweries International; since 2003, non-executive director of European
Nickel plc; since 2005, Chairman of the Management Board of the British
Institute at Ankara (BIA); citizen of the United Kingdom; member of the
Board of Directors since 30 March 2007.
Education: Master of Arts (Hons) from Oxford University, UK in 1965.
Bernard SUCHER
(born in 1960) – since 2006, President of I.M.Galt, Inc.; since 2011, member
of the Board of Directors of Aton Group; since 2011, member of MMK’s
Board of Directors.
Education: University of Michigan, 1983, Bachelor, Business Administration
with an additional concentration in Russian and Soviet Studies.
Columbia University Graduate School of Business, 2001, Senior Executive
Program.
David HERMAN
(born in 1946) – since 2006, Chairman of the Board of Directors of OJSC
Sollers; since 2009, Chairman of the Board of Directors of DELTA AUTO;
since 2011, member of MMK’s Board of Directors.
Education: JD Harvard Law School; MA Harvard Graduate School (Ford
Foundation, Fellow in Soviet and East European Studies); BA New York
University (magna cum laude).

2011 /
ANNUAL REPORT
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Boris DUBROVSKY
(born in 1958) – since 2011, MMK’s General Director; since 2010, member
of the Board of Directors of OJSC Zavod #9; since 2011, member of
the Board of Directors of OJSC Uralkriomash; since 2011, member of the
Board of Directors of MMK Metalurji Sanayi, Ticaret ve Liman İşletmeciliği
Anonim Şirketi; since 2011, member of MMK’s Board of Directors.
Graduate, Magnitogorsk Mining and Steel Academy (1990), Russian Presidential
Academy of National Economy and Public Administration (2001).
Nikolai LYADOV
(born in 1956) – since 2011, MMK’s Deputy General Director for Sales;
since 2011, member of the Board of Directors of JSC Intercos-IV; since
2011, member of MMK’s Board of Directors.
Graduate, Magnitogorsk Institute of Mining and Metallurgy, specializing
in transport organization and administration.
Vitaly BAKHMETIEV
(born in 1961) – since 2011, MMK’s Deputy General Director for Commerce;
since 2011, member of MMK’s Board of Directors.
Graguate, Magnitogorsk Institute of Mining and Metallurgy, specializing in
ferrous and non-ferrous alloys casting.
Oleg FEDONIN
(born in 1967) - since 2010, member of MMK’s Board of Directors.
Graduate of the Magnitogorsk Institute of Mining and Metallurgy in 1983
with a degree in metallurgical engineering; Ural Academy of Public Administration
(1996), PhD (Economics) (2002).
Full Name
Date of
election to the
BoD
V. Rashnikov 02.04.1993
66 67
Date of
election to the
BoD
Participation
in meetings
before
20.05.2011
Participation in
meetings after
20.05.2011
4 13
V. Bakhmetiev 20.05.2011 – 13
B. Dubrovsky 20.05.2011 – 13
Sir D. Logan 30.03.2007 4 13
N. Lyadov 20.05.2011 – 13
Z. Rustamova 21.04.2006 4 12
B. Sucher 20.05.2011 – 13
02.04.1993
O. Fedonin 20.05.2010 4 13
D. Herman 20.05.2011 – 13
P. Charow 30.03.2007 4 13
A. Gorodissky* 22.04.2005 4 –
S. Krivoschekov* 19.05.2000 4 –
K. Lyevin* 21.04.2006 4 –
R. Takhautdinov* 21.05.1999 3 –
V. Shmakov* 25.04.2008 25.04.2008 4 –
* Board members before 20 May 2011
Committees of the Board of Directors
Meetings of the Board of Directors in 2011
To improve the efficiency of the Board of Directors’ work and their resolutions, MMK has set up the following committees:
• Audit Committee;
• Nominations and Remuneration Committee;
• Strategic Planning and Corporate Governance Committee.
These committees submit performance reports to the Board of Directors not later than thirty business days before
the date of the Annual General Shareholders’ Meeting.

2011 /
Committee Functions
ANNUAL REPORT
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Audit Comittee
– Selection of the independent Auditor.
– Supervision of the Company’s financial and
business activities.
– Interaction with the Company’s Auditor.
– Evaluation of the performance of internal
control.
– Independent supervision of the financial
reporting internal control system and
evaluation of performance of the Company’s
financial reporting internal control system.
– Preparation of recommendations for the
Board of Directors to adopt resolutions on risk
management, supervision of the Company’s
comprehensive risk management system and
analysis of risk management efficiency.
Nominations and Remuneration Committee
– Preparation of recommendations on
candidates for the position of head of the
control department.
– Preliminary review of candidates for
positions of members of the Company’s
governing bodies and the Audit
Committee and presentation of relevant
recommendations to the Board of Directors.
– Preparation of proposals regarding terms
and conditions of contracts with members
of the Board of Directors and the Individual
Executive Body.
– Review of proposals from shareholders
on nomination of candidates to the Board of
Directors and the Audit Committee and for the
position of the Individual Executive Body.
– Preliminary review of the annual report
on remuneration and compensation paid to
members of the Company’s governing bodies.
– Other functions.
Strategic Planning and Corporate
Governance Committee
– Determination of prioritized areas of
activity and development strategy of the
Group;
– Approval of long-term plans, programs,
policies and key areas of activity of the Group.
– Approval of a report on acquisition of the
Company’s shares.
– Approval of major transactions in cases
provided for in Chapter Х of the Law.
– Approval of the Company’s financial
and business operations plan (budget) for
the financial year and supervision of its
implementation.
– Discontinuation (partial discontinuation)
of activities regarding the manufacture of
products, sales, performance of work and
provision of services.
– Calling of annual and extraordinary general
shareholders’ meetings.
– Preparation of recommendations for the
General Shareholders’ Meeting on profit
distribution.
– Supervision of execution of resolutions
of the Board of Directors by the Company’s
executive body.
- Other functions.
Committee members*: 2011-2012 2011-2012 2011-2012
Chairperson:
Members:
Total meetings in
2011*:
Participation in
meetings
Key Issues:
Peter Charow
(independent Director);
Zumrud Rustamova
(independent director);
Bernard Sucher
(independent director)
Zumrud Rustamova
(independent director)
Sir David Logan
(independent director);
David Herman
(independent director)
Victor Rashnikov
Vitaly Bakhmetiev;
Boris Dubrovsky;
Nikolai Lyadov;
Oleg Fedonin;
David Herman
(independent director);
Peter Charow
(independent director);
10 14 10
– Efficiency of the internal control and audit
system.
– Risk management efficiency.
– Analysis of financial statements (in
accordance with RAS and IFRS).
– Outcome report on the review of OJSC
MMK’s consolidated financial accounts carried
out by KPMG (IFRS-based).
– Determination of the size of remuneration
to OJSC MMK’s Auditor; recommendations to
the Annual General Shareholders’ Meeting
regarding a candidate for the position of the
Auditor.
Committee Members participated in all meetings
– Recommendations to the Annual General
Shareholders’ Meeting regarding the size of
remuneration and compensation payable to
the members of the Board of Directors and the
Audit Committee;.
– Consideration of proposals submitted by
shareholders regarding candidates to the
Board of Directors and Audit Committee, and
inclusion of such candidates in the voting
ballot for elections to the Board of Directors
and Audit Committee;
– Key Performance Indicators.
– Option Plan.
– Improvement of the MMK Group’s
management structure, motivation and wage
policy;
– Implementation of guidelines of the MMK
Group’s HR policy.
Regulations: http://www.mmk.ru/corporate_governance/internal_documents/group_documents/
*Committee members and the total number of meetings for the period of 20.05.2011 till 25.05.2012.
– Implementation of the Financial and
Business Operations Plan (Budget) in 2011.
– Approval of the 2012 budget.
- 2011 report of the General Director on dayto-day
operations.
– Recommendations to the Annual General
Shareholders’ Meeting regarding profit
distribution, including the size of dividend on
shares and procedure of dividend payments;
– Implementation of the production plan,
capital construction programme, sales policy,
procurement policy, social policy, integration
policy and modernization plan.
– Efficiency of raising and placement of
funds.
– Efficiency of investment activities.
– Improvement of quality, environmental,
industrial and occupational safety systems.
– Calling and conduct of the Annual General
Shareholders’ Meeting.
Individual Executive Body
At the Annual General Shareholders’ Meeting on
20 May 2011, functions of the Individual Executive
Body were transferred to MMK’s General Director
(previously the functions were performed by LLC MMK
Managing Company). The Individual Executive Body, the
Company’s General Director, manages the Company’s
day-to-day operations.
The General Director is elected (appointed) by the
General Shareholders’ Meeting for a five-year term and
may be re-elected (re-appointed) an unlimited number
of times.
Shareholders (shareholder) owning in total at least
2% of the Company’s voting shares may nominate a
candidate for the position of the Company’s General
Director within 40 days of the end of the financial year
preceding the final year of the General Director’s term
of office.
The General Director’s responsibilities include all
matters related to management of the Company’s
day-to-day operations, except for questions for which
the General Shareholders’ Meeting and the Board of
Directors have responsibility. The Company’s General
Director is Boris Dubrovsky.
MMK’s Management Board
Before 20 May 2011, the Company’s collective executive body was the Management Board. After 20 May 2011,
functions of the Management Board were distributed between the General Director and the Board of Directors.
Members of the Management
Board:
Chairman:
(Before 21 February 2011)
Member of the Board:
68 69
MMK’s Management Board
(before 20 May 2011)
Rafkat Takhautdinov (born in 1958) – First Vice-President of LLC MMK Managing Company for
Strategic Development and Steel-Making, member of the Management Board since 21 May 2010.
13
Boris Dubrovsky
Year of birth 1958
Education
Positions held
Graduate of the Magnitogorsk Mining and Steel
Academy and the Russian Presidential Academy
of National Economy and Public Administration
since 2011 - General Director of MMK;
since 2010 - member of the Board of Directors of
OJSC Zavod #9;
since 2011 - member of the Board of Directors of
OJSC Uralkriomash;
since 2011 - member of the Board of Directors
of MMK Metalurji Sanayi, Ticaret ve Liman
İşletmeciliği Anonim Şirketi;
since 2011 - member of MMK’s Board of
Directors
Vladimir Andriyanov (born in 1956) – Commercial Director, member of the Management Board since
21 December 2001;
Valentin Antonyuk (born in 1950) – Director for Capital Construction, member of the Management
Board since 13 April 2001.
Yury Bodyaev (born in 1961) – Managing Director, member of the Management Board since 30 May
2003.
Andrey Yeremin (born in 1972) – Acting Director for Strategic Development, member of the
Management Board since 19 November 2010.
Marina Zhemchueva (born in 1960) – Chief Accountant; Chief Accountant of LLC MMK Managing
Company; member of the Management Board since 19 May 1997.
Nikolai Lyadov (born in 1956) – Sales Director; member of the Management Board since 30 March
2007.
Alexander Mastruev (born in 1952) – Vice-President for Personnel and Social Programmes of LLC
MMK Managing Company; member of the Management Board since 19 May 1997.
Vladimir Ruga (born in 1970) – Director for External Communications of OJSC MMK; member of the
Management Board since 19 November 2010.
Ivan Senichev (born in 1970) – Director for Human Resources of OJSC MMK; member of the
Management Board since 19 November 2010.
Dmitri Usanov (born in 1978) – Director for Capital Markets of OJSC MMK; member of the
Management Board since 19 November 2010.
Oleg Fedonin (born in 1967) – Vice-President of LLC MMK Managing Company for Finances and
Economics; member of the Management Board since 27 November 2009.
Arkadiy Chernov (born in 1953) – Head of the Staff of the President of LLC MMK Managing Company;
member of the Management Board since 24 March 2000.

2011 /
ANNUAL REPORT
About Us Sales Markets
Finances
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Management
Information
Remuneration of Senior Management
Remuneration of MMK’s senior management comprises a monthly salary and an annual bonus.
The annual bonus depends on achievement of key performance indicators. Key performance
indicators are determined based on MMK’s short- and long-term goals.
Members of MMK’s senior management do not receive any additional compensation for their work in
MMK’s and its subsidiaries’ governing bodies (MMK’s Management Board and Boards of Directors of
subsidiaries).
Audit Committee
Functions
Committee
members:
Audit Committee
Internal audit of the Company’s financial and business
operations;
Ensuring legal compliance and protection of shareholder
rights.
12
Chairman: Igor Vier (born in 1961)
Committee
members:
Remuneration
of the Audit
Committee
Regulations:
Dmitry Lyadov (born in 1973)
Evgeny Kebenko (born in 1969)
Alexander Maslennikov (born in 1969)
Alexey Zaitsev (born in 1977)
Yaroslav Letimin (born in 1969)
Oksana Dyuldina (born in 1971)
Ilya Postolov (born in 1976)
Galina Akimova (born in 1969)
Boris Chistov (born in 1974)
Olga Nazarova (born in 1983)
Elena Artamonova (born in 1954)
On 20 May 2011 MMK’s Annual General Shareholders’
Meeting approved the size of remuneration and
compensation to members of the Audit Committee
totalling RUB 39 million.
http://www.mmk.ru/upload/iblock/
f52/dhkagnobhmcsodptnvhx%20ik%20
vdrsnlvggznqatepulbx%20ep%20atiopqlxag%20%20
aszndvukuhbvbfkw%20qltuau%20ojidzu%20_aabbsaowvi_.
pdf.
Information about the Registrar
Closed Joint-Stock Company Registrar Company STATUS (license # 10-000-1-00304, issued on 12 March
2004 by the Federal Agency for Financial Markets for an indefinite period) is responsible for maintaining
and keeping OJSC MMK's share register. The Registrar’s registered office is located at the address:
Ul. Novorogozhskaya 32, Building 1, Moscow, 109544, Russian Federation
tel: +7(495) 974-83-50
fax: +7(495) 678-71-10
e-mail: office@rostatus.ru
Financial Reporting Internal Control System
OJSC MMK has created and operates an internal control system.
The system's efficiency is assessed every year with respect to the materiality level evaluated on an
annual basis in order to verify the reliability of annual consolidated financial statements. To determine
the materiality level, a top-down approach is applied in conformity with the methodology used for
internal control systems' audits as set out in Audit Standard # 5 (PCAOB AS5).
The financial reporting internal control system is operated to ensure a reasonable degree of security
regarding the accuracy of financial reports and their compliance with the applicable standards (IFRS).
Day-to-day supervision of the financial statements is performed independently by the Vice President for
Finances and Economics and the Control Administration.
Information on the Auditor
The auditor’s rotation policy is in line with regulations governing OJSC MMK Board of Directors’ Audit
Committee, and is based on the selection of an internationally renowned and reputable auditor.
In 2011, KPMG was the Company’s Auditor (KPMG was also the Company’s Auditor from 1997 to 2005).
From 2006 to 2010, the Company’s Auditor was Deloitte and Touche CIS, a division of Deloitte.
The Auditor's fees in 2011 totalled RUB 28 million and included:
• fees for audit of RAS 2011 accounting (financial) statements totalling RUB 8 million;
• fees for review of the 2011 consolidated accounting (financial) statements and audit of
accounting (financial) statements prepared under IFRS totalling RUB 20 million.
Every year the appointed Auditor confirms its independence from the Company. The Board’s Committee
for Audit reviews the provision of any non-audit services to be provided by the Auditor, in order to
maintain the independent status of the Company’s Auditor.
In 2011, KPMG did not provide any services to OJSC MMK which were not related to audit.
Membership certificate #255 dd. 28.12.2009. Principal Number of Registration Entry: 10301000804.
Location: Olimpiysky Prospekt 18/1, ap.3035, Moscow.
70 71

2011 /
ANNUAL REPORT
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Information for Investors
Information on Company Securities
Ordinary Shares
OJSC MMK's shares are traded on MICEX-RTS, the leading Russian stock market, and are listed on the
London Stock Exchange (LSE).
Trading Platform Issuer code
MICEX-RTS, Moscow MAGN
LSE, London MMK
*1MICEX and RTS merged on 16 December 2011
On the LSE, MMK's shares are traded as Global Depositary Receipts (GDRs), with 1 GDR corresponding to 13
shares. MMK’s free float represents 12.7 % of the Company’s outstanding shares.
The Company's shares are included in the following indices:
Index Date of inclusion
RTS Index 15.10.2007
MICEX Index 15.10.2007
RTS Metals and Mining Index 15.06.2007
MICEX Metals and Mining Index 14.08.2007
MICEX MC Index 06.08.2007
DAX Global Russia 24.09.2007
OJSC MMK Share Quotes and Trading Volumes on LSE (USD)
Minimum Maximum End of the period
Average daily
trading volume
2009 2.09 11.53 11.3 3,673,185
2010 8.79 15.19 14.55 5,892,020
2011 4.25 16.23 4.87 6,022,151
Share price
Trading volume
72 73
3
2
1
0
5%
-5%
-15%
-25%
-35%
-45%
-55%
-65%
-75%
31.12.10
25.01.11
Million shares
OJSC MMK GDR Share Price on LSE
and Bloomberg Europe Metals & Mining Index in 2011
19.02.11
16.03.11
10.04.11
05.05.11
30.05.11
3 Jan 2011 24 Feb 2011 16 Apr 2011 7 Jun 2011 28 Jul 2011 17 Sep 2011 10 Nov 2011 31 Dec 2011
OJSC MMK Share Price and Trading Volumes on MICEX (RUB)
Minimum Maximum End of the period
Average daily
trading volume
2009 5.03 27.19 25.03 43,155,031
2010 20.80 34.61 32.90 72,142,274
2011 10.91 37.06 12.36 121,457,684
24.06.11
19.07.11
13.08.11
07.09.11
02.10.11
27.10.11
Bloomberg Europe Metals & Mining Index MMK
21.11.11
16.12.11

2011 /
ANNUAL REPORT
About Us Sales Markets
Finances
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Social Sphere
Management
Information
Share price
40
30
20
10
RUR
3 Jan 2011 24 Feb 2011 16 Apr 2011 7 Jun 2011 28 Jul 2011 17 Sep 2011 10 Nov 2011 31 Dec 2011
Trading volume
40
30
20
10
million shares
OJSC MMK Share Price and Trading Volumes on MICEX in 2011
0
3 Jan 2011 24 Feb 2011 16 Apr 2011 7 Jun 2011 28 Jul 2011 17 Sep 2011 10 Nov 2011 31 Dec 2011
Supported by the global economic recovery and progressively increasing world demand for steel
products in 2010, investor demand for MMK shares increased in Q1 2011. During this period, MMK
continued to increase its exposure to the domestic market.
At the beginning of Q2 2011, stocks trended downwards as the Greek debt crisis threatened to spill over
into other European markets. Russian and European stock indices declined amid fears that the European
debt crisis might hamper the global recovery.
As of 30 December, 2011, analysts from leading investment banks, including JP Morgan, Morgan Stanley,
Citi Group, Credit Suisse, UBS, Merrill Lynch, had “buy” recommendations on MMK shares. Among
the Company’s strengths they listed the growing share of high value added products, exposure to
burgeoning sectors of the domestic market and the highest potential in the sector to increase output.
MMK’s investor relations programme in 2011 helped to improve liquidity. The average daily trading
volume for the three stock markets (RTS, MICEX, LSE) reached USD 10.0 million in 2011 (against USD 8.1
million in 2010). The LSE remained the most liquid trading venue for the Company, accounting for 60%
of share transactions in 2011. Share turnover on the Russian stock market began to increase at the end
of 2011.
MMK’s market cap trended upwards in Q1 2011
and reached a year high of USD 13,951 million
on January 18, 2011. In March 2011, the global
geopolitical situation began to deteriorate rapidly
(earthquake in Japan, escalation of riots in Bahrain
and worse than expected economic performance
in the US). The stock markets were immediately
affected, with investors fearing that the global
economic recovery might be undermined.
In September 2011, global market meltdown
continued amid new recession fears, unresolved
issues related to Greece and discouraging
suggestions from the US Federal Reserve
regarding support for financial markets.
As of 31 December 2011, MMK’s market
capitalization stood at USD 4,183 million.
Investor Relations
74 75
MMK Market Capitalization in 2011, USD
million (LSE)
One of the Company’s priorities is to maintain strong relations with existing and potential investors
through direct dialogue and in line with existing legislation and best practice.
MMK’s management has focused on responding to the interests of investors, and establishing a
relationship based on trust by improving transparency. In keeping with the principles of transparency
and accessibility of information, the Company publishes statements of significant events on the website
of the London Stock Exchange. The Company's official site has sections devoted to Investor Relations
and Corporate Governance that contain a wide array of information in Russian and English, including
the Company's internal documents and bylaws, annual reports, information for shareholders' meetings,
data on the Company's registrar and auditors, information on dividend payments, as well as quarterly
financial statements under IFRS and RAS. The website also features a financial calendar with planned
events and reporting dates.
More detailed information can be found on MMK's official site at: http://www.mmk.ru in the Investor
Relations and Corporate Governance sections.
Effective dialogue with the capital markets requires constant attention from the Company's
management. MMK management regularly participates in international conferences and holds meetings
with investors. Publication of quarterly financial results always includes telephone conferences for
investors with MMK management. Financial statements are supplemented with presentations which give
additional insight into the Company’s performance and strategy.
Investors are invited to contact us with any questions related to MMK’s business activity:
Valentina Khavantseva
Corporate Secretary
Tel: +7 (3519) 24-72-29
E-mail: khavanceva.vn@mmk.ru
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
0
2,000
4,111
4,000
4,183
5,325
5,351
Andrey Serov
Investor Relations Department
Tel: +7 (3519) 24-52-97
E-mail: serov.ae@mmk.ru
6,000
6,851
8,000
10,000
10,796
10,151
9,782
9,541
12,000
12,507
12,550
12,421
12,575

2011 /
ANNUAL REPORT
About Us Sales Markets
Finances
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Management
Information
Publication of Production Results
10 February 2012
20 April 2012
25 May 2012
2012 Financial Calendar*
General Shareholders' Meetings
Board of Directors Meetings
OJSC MMK Annual General
Shareholders' Meeting
OJSC MMK Board of Directors
Meetings
Publication of RAS Financial Statements
22 March 2012 Q4 (12 months) 2011
May 2012 Q1 (3 months) 2012
August 2012 Q2 (6 months) 2012
October 2012 Q3 (9 months) 2012
Publication of IFRS Financial Statements
18 April 2012 Q4 (12 months) 2011
June 2012 Q1 (3 months) 2012
September 2012 Q2 (6 months) 2012
December 2012 Q3 (9 months) 2012
Publication of Production Results
27 January 2012 Q4 (12 months) 2011
26 April 2012 Q1 (3 months) 2012
July 2012 Q2 (6 months) 2012
October 2012 Q3 (9 months) 2012
*dates are subject to change (http://www.mmk.ru/for_investor/financial_calendar/ )
Report on Payment of Declared (Accrued) Dividends on OJSC MMK Shares
MMK's dividend policy is based on shareholders' interests and the Company’s requirements for further
growth and technological upgrades.
The Regulations on the Dividend Policy can be found at the following address: http://www.mmk.ru/
corporate_governance/internal_documents/group_documents/
Basis year
for dividend
accrual
Dividend per share,
RUB
2006 3.209
2007 0.920
2008 0.382
2009 0.37
2010 0.33
2011** 0.00
OJSC MMK Dividend Payments
76 77
Dividends accrued
34,112,381.11 RUB '000
1,287,696.70 USD '000
10,488,754.52 RUB '000
428,712.38 USD '000
4,268,594.06 RUB '000
173,891.90 USD '000
4,134,502.1 RUB '000
130,921.54 USD '000
3,687,528.90 RUB '000
121,420.12 USD '000
— RUB '000
— USD '000
*For 2006-2007 under US GAAP, for 2008-2010 under IFRS (parent company shareholders' profit for the period).
** At the meeting on April 20, 2012, the Board of Directors resolved not to distribute dividends for 2011.
Dividend as a
proportion of net
profit*
90 %
24 %
16 %
56 %
48 %
0 %

2011 /
ANNUAL REPORT
About Us Sales Markets
Finances
Risks
Social Sphere
Management
Information
Board of Directors report on MMK’s
performance in 2011
Following on from the Strategic Development Plan through 2017 approved by the Board of Directors
in 2008, in 2011 a Business Development Plan through 2013 was drafted and ratified. The Business
Development Plan includes the following priorities:
1. Procurement of raw materials;
2. Expansion of steel products deliveries to the higher priority domestic market;
3. Consolidation of MMK’s position in the key export markets of Asia, the Middle East and North
Africa;
4. Technical upgrading of OJSC MMK;
5. Improvement of the Quality Management System;
6. Improvement of the Corporate Governance System;
7. Minimization of environmental impact;
8. Improvement of the HR management system;
9. Enhancement of social security for OJSC MMK’s employees.
In 2011, the Board of Directors held 17 meetings and voted on 203 issues. The most significant decisions
with the greatest effect on the Company’s activity in the reporting year were the following:
1. Determination to establish a Committee for Audit, Committee for Strategic Planning and
Corporate Governance, and Committee for Nominations and Remunerations, all reporting to the
Board of Directors;
2. Decisions to approve long-term plans, projects, strategies and core activities of MMK and
companies within MMK Group;
3. Decisions governing the Company’s financial and economic strategy (monitoring of execution
and approval of OJSC MMK’s financial and economic plan and guidelines of fundraising and
placement).
Under the Federal Law on Joint Stock Companies, the Board of Directors is the key body safeguarding
shareholders’ rights, shaping and implementing the Company’s strategic development plan and
overseeing successful operating and financial results.
All of the Board’s actions in the reporting year were fully transparent for shareholders, and minutes of all
meetings are available to any shareholder on request.
The Board’s activity in 2011 was in full conformity with the approved programme, and implementation
was monitored on a regular basis. There were no unexecuted decisions for the reporting period.
General Information on MMK
Full Name of the Company:
• in Russian: Открытое акционерное общество «Магнитогорский металлургический комбинат»;
• in English: Open Joint Stock Company Magnitogorsk Iron & Steel Works.
Abbreviated Name of the Company:
• in Russian: ОАО «ММК»;
• in English: OJSC MMK.
State Registration Certificate
Certificate #0002 series GA (registration #186).
Date of state registration: 17.10.1992.
Certificate of Entry in the Uniform State Register of Legal Entities: series 74 # 000603904, OGRN
1027402166835, date of entry: August 12, 2002.
The Company’s location and postal address:
Ul. Kirova 93, Magnitogorsk, 455000, Chelyabinsk Region, Russia.
Tel: 24-72-92, 24-30-04, Fax: 24-73-09
Company Website:
Web-site: http://www.mmk.ru
Communications and Public Relations:
Phone: (3519) 24-03-02, fax: (3519) 24-85-54, е-mail: press@mmk.ru
Legal Status of OJSC MMK
Magnitogorsk Iron and Steel Works is an open joint stock company. According to the legislation of the
Russian Federation, a joint stock company is an organization whose authorized capital is divided into a
certain number of shares which certify rights of obligation of the company’s members (shareholders) in
relation to the company.
The shareholders are not responsible for the Company’s obligations and bear the risk of losses in
connection with the Company’s activity to the extent of their shares’ value.
The Company is a legal entity which owns separate property entered in the Company’s independent
balance sheet. The number of shareholders of the Company is not limited.
Countries in Which the Organization Conducts its Business
OJSC MMK runs its operations in the Russian Federation (Magnitogorsk, Belovo, Bakal, St. Petersburg and
Moscow) and the Republic of Turkey (Istanbul, Iskenderun). The Company’s key suppliers are located in
Russia and Kazakhstan. MMK sells its products to 70 countries worldwide. The key shipment destinations
include CIS, the Middle East, Europe, and Asia.
78 79

2011 /
ANNUAL REPORT
About Us Sales Markets
Finances
Risks
Social Sphere
Management
Information
General Information on the Annual Report
Date of Publication of the Latest Previous Report
The previous Annual Report of OJSC MMK was prepared based on 2010 results and approved by the
Annual General Shareholders' Meeting on 20 May 2011. OJSC MMK’s Annual Report 2010 is available for
review at MMK's web site www.mmk.ru/for_investor/annual_reports/
Procedure of Determining the Report’s Content
Annual Reports of OJSC MMK are prepared each year in accordance with Federal Law of the Russian
Federation on Joint Stock Companies no. 208-FZ dated 26 December 1995, as amended and with the
Regulation on Information Disclosure by Issuers of Securities of the Federal Agency for Financial Markets
no. 11-46/pz-n dated 4 October 2011.
In preparing this Annual Report, OJSC MMK aimed at the fullest possible disclosure of information
related to all aspects of its operations in 2011. The Report covers the Company’s various activities
(production, business, financial, social and environmental) of interest to all parties concerned. The
parties concerned were identified following a comprehensive analysis of the Company's operations and
the influence exerted by them on the social sphere and the environment.
As a result, top priority was assigned to the following subjects: production, financial performance, sales,
related party transactions as well as the Company’s social and environmental activities. All facts and
events influencing the Company’s ability to achieve its strategic goals were considered material.
Scope of the Report
This Report has been prepared on the basis of the results of OJSC MMK’s operations, as presented in
financial statements prepared according to Russian Accounting Standards for the 2011 financial year,
and consolidated financial statements for MMK Group were prepared according to IFRS.
Limitations Regarding the Scope of the Report
This Report provides a complete picture of MMK’s operations, and any further expansion of the Report
is possible only in terms of increasing the number of performance indicators, should such interest be
expressed by any of our stakeholders.
Influence on the Comparability of the Report
This Report includes information on MMK Group’s operational results and is therefore comparable to the
reports of OJSC MMK and the MMK Group for previous periods.
Material Changes in the Report
This Report does not contain any material changes compared to the information provided in previous
reports, or any changes in relation to previous periods in terms of the content, scope or measurement of
OJSC MMK’s results.
Boris Dubrovsky, General Director, OJSC MMK
Marina Zhemchueva, Chief Accountant, OJSC MMK
80
Working for a
greater Russia!
93, Ul.Kirova, Magnitogorsk, Russia
Tel.: 8-800-775-000-5 (toll free in Russia)
Fax: (3519) 24 73 09
455000, Россия, г. Магнитогорск, ул. Кирова, 93. Тел.: (3519) 24 79 29. Факс: (3519) 24 92 00.
www.mmk.ru
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