Ferrexpo GroupAn Introduction

Analyst Site Visit – July 2008

1

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2

Ferrexpo management on Site Visit 2008

Gavin Mackay

Group Manager – Investor RelationsChris Mawe

Chief Financial Officer

Simon Wandke

Chief Marketing Officer

Dave Webster

Interim Group Chief Operating Officer

3

CURRENT OPERATIONS

MARKETING AND LOGISTICS

GROWTH PROJECTS

OVERVIEW

FINANCIALS

OUTLOOK

4

The strategy

The Ferrexpo value proposition

The only pure play iron ore company in the FTSE 100

The key facts The opportunity

¹ 6.3bn tonnes of proven resources (under JORC Code) plus c. 14bn tonnes of further estimated resources (Soviet GKZ Code)

• Ferrexpo‘s Poltava operations

constitute a globally significant

iron ore resource at

approximately 20 billion

tonnes¹

• Global steel industry and

demand for iron ore is growing

strongly

• Pellets have become relatively

attractive vs other forms of iron

ore

• Proximity to markets

• Strong customer base

• Operational history

• Current infrastructure

requirements in place

• Excess pelletising capacity

• Brownfield project pipeline

• International management

team

• Recent performance track

record

• Commercialise the

ore body

• Aggressive growth

• Partnering

• Focused initiatives

• Operational performance

• Cost control

• Production growth

• Critical partnerships

• Market share

• Product quality

• Organisation Capability

• Governance

• Best practice

5

Ferrexpo – a snapshot

June 2008 Ferrexpo enters FTSE100 index with a

market capitalisation of US$4,828m at

400p per share

June 2007 Ferrexpo plc lists on the Main Board of the

LSE with pre-IPO market capitalisation of

US$1,671m at 140p per share

2004/05 New international management team

appointed to list the Company and initiate

Business Improvement Programme

2001 Kostyantin Zhevago buys out business

partners

1996 - 2000 Kostyantin Zhevago and business

partners acquire majority of shares in

Poltava GOK, Ferrexpo‘s operating asset,

in a series of transactions

1995 Privatisation process commences

1977 Soviet era production of iron ore pellets

1970 Soviet-era mining and iron ore

concentrate production

1960s Mining operations commence at Poltava

at current FPM site

Reserves Resources (incl. Reserves)

Proved and probable Measured and indicated Inferred

million tonnes

Fe grade (%)

million tonnes

Fe grade (%)

million tonnes

Fe grade (%)

Gorishne-Plavninskoye 399 30 1,443 30 1,275 31

Lavrikovskoye 92 30 812 30 174 29

Total PGOK 491 30 2,255 30 1,449 31

Yeristovskoye 632 34 765 27 96 17

Belanovskoye 1,627 31 37 30

Galeschinskoye 325 59 29 59

Total projects 632 34 2,717 33 162 27

Total assets 1,123 32 4,972 32 1,611 30

Source: SRK

JORC reserves and resources

Konstantyn Zhevago

Public

Decometal (DCM)

Minority

Ferrexpo plc

(UK)

Ferrexpo

Poltava Mining

(UK)

Ferrexpo UK Ltd

(UK)

Ferrexpo AG

(Swiss)

72.3%

27.7%

10.6%

3.6%

100%

85.8%1

100%

History and development Current shareholdings

1 Ferrexpo has a repurchase agreement with Decometal under which it is entitled to acquire Decometal’s 10.6% holding in Ferrexpo Poltava Mining in 2008 for $11m,

which will bring its holding in FPM to c.96.4%

6

0

2,500

5,000

7,500

10,000

12,500

15,000

1970

1971

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

ConcentratePelletsWith Northern Extension - ConcentrateWith Northern Extension - Pellets

kt

History of sustained production

Introduction of 62% Fe pellet production

Independent UkraineUSSR

Ferrexpo is in a position to exceed its historical production highs

Introduction of 65% Fe pellet production

7

Recent performance highlights

Location

Ferrexpo

2007 Revenue

US$698m

2007 EBITDA

US$246m1

2007 Net income

US$124m

2007 Employees

10,1122

2007 Production

9.1mt

1 EBITDA is calculated as profit from continuing operations before tax and finance less foreign exchange (loss)/gain plus depreciation (included in both cost of sales and administrative expenses) and

non-recurring cash items included in other income, non-recurring cash items included in other costs plus disposal of subsidiaries and associates. EBITDA is not a measure of financial performance

under IFRS

2 Poltava employees only – yearly average

Share Price Performance Since IPO

Current Market Capitalisation

US$3,950m

+16%

+133%

2008 Contract Price Increase

90% +

0

50

100

150

200

250

300

350

400

450

Jun-0

7

Aug-0

7

Oct-

07

Dec-0

7

Feb-0

8

Apr-

08

Jun-0

8

FXPO FTSE 100

FTSE 250 FTSE 350 MiningGBp

(18%)

(28%)

8

Steel industry drives iron ore market

• Unprecedented demand for steel

making raw materials; Chinese steel

will continue to drive world steel

output for ~ another 10 years; but

India, Asia and Central Europe ‗re-

industrialising‘ of growing importance

• Consolidation to continue

• Higher global industry privatisation.

Was 23% 1980, now ~78%. Good for

steel price stability. More private mills

in China.

• Big players securing up and down

stream. Break ‗big 3 grip‘. More in

mining…opportunity

• BF sector forecast to continue

dominance in all regions except

Middle East.

• Scrap availability and substitutes

supply issues: est 30+ years before

China becomes a net producer of

steel scrap

• China modernising Integrated route

capacity, adding significant pellet

capacity, and raising pellet ratios

• Global iron ore consumption growing

rapidly: China led.

• Global supply to grow. Large capacity

‗wave‘ due to hit market ~2009-2011.

Many late, over cost

• Big-3, then large gaps, although

ambitions exist; Anglo, FMG

• Cost curve steeper. Getting steeper

as China adds more high cost low

grade magnetite capacity. Big-3

suffering from strong demand cycle

cost impacts

• Steel integrated companies pursuing

resources; but will probably be green-

field, higher cost

• Pellets will continue to play important

role in meeting this demand growth

• Productivity benefits of pellets in

blast furnaces; leading to higher

BFP rates in Blast Furnaces eg

China

• Renewed interest in direct

reduced iron (DRI) production —

largely pellet-based

• Limited sources of high grade/

direct-charge lump ore

• Other refined ores (eg Sinter)

have environmental issues

• Significant addition to global capacity

planned to 2017 yet capacity

Utilisation forecast to remain high

9

Supplier of Choice to Critical Customer Group

Rail: Purchase of 550 railcars for US$33.5m

Shipping: Own 49.9% of TIS Ruda port facility, with

access to 100% of 5mtpa capacity

Nautical Miles

P. Hedland (Australia) 3,600

Saldanha (S. Africa) 8,000

Yuzhny (Ukraine) 8,600

Tubarao (Brazil) 11,000

Sev.Island (Canada) 11,5001

First (lowest cost) quartile of iron ore pellet supply

into existing markets in Central and Eastern

Europe on a CIF basis

0%

50%

100%

2003 2005 2007 2009 2011 2013 2015 2017

65% Fe 62% Fe

Black

Sea

Poland

Germany

Romania

Poltava

GOK

Bulgaria

Austria

Serbia

Italy

Slovakia

Ukraine

Russia

Turkey

Netherlands

Czech

China,

Middle East

Source: Ferrexpo plc1 Via Panama Canal2 From main ports to Qingdao

Hungary

Position of operations – location is KEY Competitive cash supply costs

Production quality increasing

Investments in logistics & infrastructure

Shipping distance to China2

Potential for DR (68% Fe) pellets under consideration

10

Strong focus on strategic marketing

2007 sales of 9,261kt

Three largest

customers represent

approximately 53% of

sales in 2007

Traditional

NaturalGrowth

Natural 2%

Traditional – Ukraine

17%

Growth 17%

Traditional

64%

• Traditional

• Building on historic relationships and logistics

advantages

• Ukraine: Maintaining historic relationships and

capturing supply to new Blast Furnace capacity in

Ukraine

• Growth

• Framework agreements at selected steel mills in

China

• Converting trial cargoes to framework agreements

in India and Japan

• Participating in China growth, brand building and

paving the way for future Ferrexpo products

growth

• Natural

• Leveraging logistics, proximity

• New contract customer in Turkey

• Further trials and progress

• c. 90% of Ferrexpo production sold on contract

BF Pellet sales by region 2007

• Ukraine

• CIS

• Eastern & Central Europe

Three strategic marketing segments

• China

• India

• Japan

• Western Europe

• Southern Europe

• Middle East

Marketing strategy

11

Resources and development horizons

Gorishne – Plavnikoe 2,718mt

Galeshchinskoe 325mt

Lavrikovskoe 986mt

Belanovskoe 1,664mt

Yeristovskoe 861mt

Brovarskoe

KharchenkovskoeVasilyvskoe

Manuylovskoe

Current mining

operations

Yeristovskoe

Belanovskoe

Galeschinskoe

Others

GPL Expansion

and

Extension

Y Development

B Development

G Development

c.14,000mt

Northern Resources

Exploration

and

Appraisal

Source: Ferrexpo plc

Substantially under-exploited iron ore resources

Dnieper River

Gro

wth

Pip

elin

e

12

Ferrexpo Group – Management structure

Members of the

Executive Committee

Mike OppenheimerChief Executive Officer

Dennis McShaneExecutive Director

Business Development

Members of the

Board of Directors

Chris Stamp

(Prism CoSec)Company Secretary

Simon WandkeChief Marketing Officer

Viktor LotousCOO & Director General

of FPM

Nikolay GoroshkoChief Commercial Officer

(Major Growth Projects)

David WebsterInterim Group Chief

Operating Officer

John DaweGroup HR Manager

Gavin MackayGroup Manager – Investor

Relations & Corporate

Comms

Nikolay KladievCFO FPM

John ArnoldGroup Treasurer

M Abrahams Chairman (UK)

O Baring Senior Independent (UK)

I Mitiukov Independent (Ukraine)

W Kuoni Independent (Swiss)

R Genovese Independent (Swiss)

K Zhevago Non Independent (Ukraine)

M Oppenheimer Executive (Aus)

D McShane Executive (USA)

C Mawe Executive (UK)

Chris MaweChief Financial Officer

George MoverDirector General (Major

Growth Projects)

Major Growth

Projects Personnel

13

Board and committees

• The management and governance structure complies with the requirements of the Combined Code

• All Board and Committee meetings are held outside the UK

• Principally in Switzerland, some in Ukraine

• The PLC board meets at least quarterly and consists of:

• Three executive directors, Mike Oppenheimer, Chris Mawe and Dennis McShane

• Kostyantin Zhevago as a non-independent, non-executive director

• Michael Abrahams, independent non-executive chairman, Oliver Baring, senior independent non-

executive director and three further independent non-executive directors, including Ihor Mitiukov,

the former Ukrainian Finance Minister and Ambassador to the UK

• The remaining INEDs, Wolfram Kuoni and Raffaele (Lucio) Genovese, are Swiss nationals

• The standing PLC Board committees meet at least twice a year and include

• Audit, Remuneration and Nomination Committees - all chaired by non-executives

• CSR Committee (not a Combined Code requirement) chaired by CEO

• The management ―Exco‖ committee

• Subject to appointment by the Board of Ferrexpo plc

• Dealing with management issues

• Comprising executive directors and senior management only

Ferrexpo is Combined Code compliant

14

Relationship with principal beneficial owner

• Kostyantin Zhevago beneficially owns 72.3% of Ferrexpo following the IPO

• Independence is effected through best practice corporate governance and business

management processes and through a relationship agreement

• Mr Zhevago is a non–executive director of Ferrexpo plc and does not participate in the executive

management of the company

• Mr Zhevago will cooperate with the Company and give it the opportunity to participate in any

transaction concerning businesses involved in the mining, processing and sale of iron ore in the

Ukraine

• All dealings with Mr Zhevago are subject to rigourous internal processes and comply with the

Related Party rules contained in the UK Disclosure and Transparency Rules

• Mr Zhevago has other interests in the metals and mining industry, as well as in auto

manufacturing, food, banking and others

15

Snapshot of Ukraine

2003 2004 2005 2006 2007

Nominal GDP (US$bn) 49.9 64.8 86.5 106.7 137.0

Real GDP growth (%) 9.5 12.1 2.6 7.4 7.5

Industrial prod % change 15.7 12.5 3.1 6.2 9.9

Source: Global Insight

Economic indicators

Stabilisation indicators

2003 2004 2005 2006 2007

Inflation (CPI) % 8.2 12.3 10.3 11.6 12.8

Budget balance (% of GDP) (0.2) (3.2) (1.8) (0.7) (1.1)

Exchange rate (UAH:USD) 5.33 5.32 5.10 5.04 5.05

• Presidential parliamentary republic

• Orange Revolution in late 2004 / early 2005

• Greater political openness, faster economic reforms and

commitment to the integration with the West

• Political outlook

• President Viktor Yuschenko sworn into office following the

Orange Revolution and is regarded as a pro-Western

liberal reformer

• Prime minister Yulia Tymoshenko heads a pro-western

coalition

• Observers optimistic that Ms Tymoshenko‘s cabinet will

adopt reforms to maintain Ukraine‘s strong economic

growth

• Entry to WTO

• Both EU and US granted ―market status‖ to Ukraine

• Ukraine is now a full member of WTO

• Legal / constitution

• Constitutional Court was only established in December

2006 which has resulted in ambiguous demarcation of

power between President and Prime Minister

Economic statistics Political system

0

5

10

15

20

25

2001 2002 2003 2004 2005 2006 2007

Foreign direct investment (US$bn)

16

Relevant laws and regulations State authorities

Ukrainian regulatory framework

• Code of Ukraine on the Subsurface (―Subsurface Code‖)

• Subsurface including its mineral resources in the exclusive property of the

Ukrainian people

• Only granted for the use of legal entities and individuals

• Can only prospect for and mine mineral resources pursuant to production

sharing agreements/licenses/permits

• Law of Ukraine No 1775-III on Licensing of certain Entrepreneurial Activities

(―Licensing Law‖)

• Land Code of Ukraine (―Land Code‖)

• Law of Ukraine No 1264 – XII on Environmental Protection (―Environmental

Law‖)

• Annual Resolutions of the Cabinet Ministers of Ukraine

• State Commission on Mineral Reserves of Ukraine

• Confirms surveys of commercially extractable minerals

• Registered State Balance of Mineral Deposits

• Applications for mining license

• State Committee for Industrial Safety, Labour Protection and Mining

Supervision

• Grants mining allotment with submission of mining license, estimated

reserves report and field development or extraction programme

• Ministry of Environmental Protection of Ukraine

• Grants exploratory licenses

• Grants licenses for extraction of minerals

• Up to 20 year licenses

• May contain special conditions and can be suspended or revoked

• Several national and regional environmental bodies

• All deposits are included within the state Fund of Natural Resources Deposits

• Separate business license required under Licensing Law

• Ancillary licenses include:

• supplying electricity at an unregulated tariff

• supplying natural gas at an unregulated tariff

• manufacturing explosives

• blasting

• operating telecommunications equipment and networks and using radio

frequencies

• construction works

Licenses and permits

• Number of environmental licenses and permits

• air emission control

• solid waste disposal

• tailings disposal

• mine waste disposal

• special waste disposal

• special use of fresh water

17

CURRENT OPERATIONS

MARKETING AND LOGISTICS

GROWTH PROJECTS

OVERVIEW

FINANCIALS

OUTLOOK

18

Operational results in 2007

• 9% increase in iron ore output to 28.9 million tonnes

• 19% increase in production of high quality (65% Fe) pellets from own ore

• Substantial savings in raw materials

• Substantial savings in energy input per unit

• Continued focus on organizational effectiveness

• leadership & capability development

• sustained reduction in headcount ( ~19% in 2 years )

19

Production performance

23.3

26.4

28.9

7.89.18.618%

35%

41%

0

5

10

15

20

25

30

35

40

2005 2006 2007

10%

15%

20%

25%

30%

35%

40%

45%Iron Ore Pellets % 65% Fe Pellets

Production and quality improvement

mt %

Stripping Volume

(mm3)13.1 18.5 18.7

20

Cost Performance

41.1

36.1

31.833.8

29.831.8

29.329.9

0

5

10

15

20

25

30

35

40

45

50

2005 2006 2007 H1/H2 2007

Nominal Real 2007

1 C1 costs are total cash costs of production of pellets from produced concentrate, ex-works2 Producer price index over period3 Average exchange rate over period

US$/t

C1 Costs in nominal and real 2007 terms1

Ukrainian PPI2 (%) 9.5 14.1 23.3

UAH/US$3 5.05 5.05 5.05

11.0

5.00

21

C1 Costs

29.26

0.150.300.260.56

0.52

0.74

31.79

C1 2006 Steel & other

materials

Electricity Gas Repairs & other Diesel Personnel

Costs

C1 2007

C1 Costs1 waterfall 2006 – 2007 ($/t)

1 C1 costs are total cash costs of production of pellets from produced concentrate, ex-works

22

5.26

3.17 3.07

2.90 3.192.27

2.832.60

3.341.441.324.094.58

7.68 8.20

5.11

0

5

10

15

20

25

30

35

2006 2007

Other

Explosives

Grinding bodies

Natural Gas

Fuel

Spare Parts

Labour

Electricity

C1 Cost Breakdown - 2007

1 C1 costs are total cash costs of production of pellets from produced concentrate, ex-works

Reduction in utilisation of critical inputs2

80

100

120

140

1Q06 2Q 06 3Q 06 4Q 06 1Q 07 2Q 07 3Q 07 4Q 07

8

9

10

11

12

Average payroll number, 000'persons

Payroll cost, mio'UAH (indexed to 100)

Labour Cost Development

C1 Costs1 by input ($/t) in 2007

Explosives

4%

Other

14%

Grinding bodies

11%

Natural Gas

9%

Fuel

10%Spare Parts

10%

Labour

17%

Electricity

25%

Total: 31.79

60

70

80

90

100

110

Q1 06 Q2 06 Q3 06 Q4 06 Q1 07 Q2 07 Q3 07 Q4 07

Electricity (MWhr) Gas (Th cubic Metres)

Grinding bodies (Kg)

Payroll cost

rebased

to 100

Employees

(000‘s)

2 per tonne of Pellets (own raw materials)

Rebased

to 100

23

Distribution costs: Rail Tariffs

80

100

120

140

Q1 06 Q2 06 Q3 06 Q4 06 Q1 07 Q2 07 Q3 07 Q4 07

Actual Cost per tonne KM

Tonnes Transported

CPI

Rail Tariff costs and related metrics (rebased to 100)

2006 2007

24

Production process and current facilities

Gorishne–Plavninskoye

Lavriskovskoye open pit mine

(28.5mt in 2007)

Crushing and Grinding

• Four kiln grate units, with design

capacity of 3.0mtpa each

• Kilns form material into pellets of

around 10–12mm and bake at high

temperature to remove moisture

• Ore crushed and ground to produce

concentrate

• Iron content increased from c.30% to

c.65%

• Design capacity of crushers is 34.0

mtpa, and of concentrators is

13.8 mtpa

• Mining operations based 30 kilometres

from Kremenchug in central Ukraine,

on banks of Dnipro River

• Hard rock iron ore mining, using

shovel, truck and train

Iron Ore Mining Beneficiation

Magnetic Separation

Flotation

Pelletising

Produced Concentrate

Purchased Concentrate

• Rail links to domestic & European customers, and Black Sea ports

• Direct access to Dnipro River also allows transportation by barge

• Ownership of 49.9% of TIS-Ruda gives access to captive loading capacity at Port

Yuzhniy of up to 5mtpa

Transport & Logistics

Rail

River Barge

TIS-Ruda

Ocean

25

Business Improvement Programme

• Ferrexpo Poltava Mining is working with international consultants GPR Dehler to increase production efficiency and reduce costs as

part of a business improvement programme

• Increasing productivity of existing fleet

• Reduce requirement for capex to increase fleet

• Improve processes and procedures on our massive site

Equipment

utilisation

Cost control

Remove

bottlenecks

Culture and

organisation

• Reverse Soviet–era ―production–at–any–cost‖ culture

• 3 year plan to reduce costs at existing pit and implement industry best practice

• Energy efficiency improvements

• Labour cost savings

• More concentrating capacity required

• Implement best practice in mining operations

• Rationalise inherited fragmented system of departments

• Training: improving local management skills

Implementation – a methodical approach

• Phased implementation underway – halfway through plan

• Reduction of unit utilisations of major cost inputs achieved

• Process is methodical and inclusive – designed to have an enduring effect on the business

Volume and efficiency gains and cost reductions with little or no spend

26

Health & safety and environment

Health & Safety

• Board, Executive Committee and Operational Management fully

committed to proactive Health and Safety

• Two further fatalities in 2008

• Intensification of safety leadership intervention

• Step change in quality of corrective actions and culture

• DuPont engaged to advise on next level safety improvement

• Objective of moving Ferrexpo to best practice over time

• Setting specific improvement goals towards this objective

Ferrexpo Poltava Mining 2005 2006 2007

Employees 10,843 11,350 10,112

Total fatal accidents 2 1 1

Total accidents 24 14 9

LTIFR 2.23 1.34 0.57

Source: Company

Health and safety performance at FPM

Environment

• Ferrexpo is complying with the international standard on environmental protection – ISO 14001­97

• Compliance with all national and local regulations concerning emissions

• Ferrexpo has adopted its own system of environmental standards and environmental controls

• Effective internal environmental management and monitoring system

• Expenditure on environmental permits and protection was approximately US$12.7m in 2007 (US$10.1 million in 2006)

27

CURRENT OPERATIONS

MARKETING AND LOGISTICS

GROWTH PROJECTS

OVERVIEW

FINANCIALS

OUTLOOK

28

Marketing in 2007

Establishing a key differentiating capability

• Objective to produce all Fe +65% within 5 years

• ‗Supplier of choice‘ for key customers

• Achieved desired level of LT contracts, with direct linkage to global pricing

• Achieved premium to record pellet price increases as of April 2008 (90%+)

• Securing new customers in advance of major growth

• Considering potential for DR (68% Fe) pellets – Middle Eastern markets

• Investments in logistics

• TIS-Ruda port facility at Yuzhny commissioned (49.9% Ferrexpo)

• Establishing own fleet of railcars

29

Our core market segments

Growth Markets

• China: East, Southern: Growing mid sized mills

• Grow with selected mills: BFP, PF

• Selected strategic tie ups

• BF/DRP business Asia

Natural Markets

• Take share in W Europe as our

quality improves

• Grow DRP, PF business in

Middle East

• Capture major share in BOF

growth regions: Turkey

• Leverage proximity via logistics

• Currently ~45mtpa pellet

consumption

Traditional Markets

• Position as ‗Supplier of Choice‘

• Hold/grow share where possible: replace Vale

• Grow margins to CFR-VIU maximum

• Leverage Logistics and Trading

• Seek new niche positions in

Russia, other regions

• India niche plays

• Australia potential- low Phos

30

Ferrexpo is marketing-driven

• Maximise benefit of favourable location

• Three core target segments, based on Ferrexpo‘s competitive position and their relative value

• Create market for additional sales volumes from full utilisation of the existing pelletising capacity

• Maintain share of traditional market by rebuilding relationships and refocusing sales offering, and VIU pricing

• Establish a ―beachhead‖ position in Natural markets, and Growth markets

• Continue product quality enhancement program at Ferrexpo Poltava Mining

• Establish selected long–term Framework Agreements within Natural and Growth markets

• Widen market for subsequent pellet volume growth

• Mine and Delivery facilities plans to be progressed in line with market capture objectives:

• TIS-Ruda

• Own rail cars

• Enhance product quality and diversify product range to meet increasing customer requirements

• Build further value growth

• Potentially include Fines, concentrate and DR pellets in product suite

• Leverage logistics and marketing positions and capability beyond equity pellet sales : strategic alliances

Positioning and capability development to secure market share ahead of significant production uplift

Broadening our markets in preparation for increased production is central to the Ferrexpo

business strategySource: Company

31

Market Performance in 2007

Revenue and average pellet price

547

698

61.872.3

0

125

250

375

500

625

750

2006 2007

40

50

60

70

80Revenue Price

17%

64%

2%

17%

Ukraine

Traditional Markets

Natural Markets

Growth Markets

$m

$ p

er

tonne D

AF

/FO

B

EBITDA margin by segment

China

India

Japan

Growth Markets 25%

Natural Markets

Western Europe

Southern Europe

Middle East

29%

Traditional Markets

CIS

Eastern Europe

Central Europe

31%

Ukraine 46%

Market mix 1

2007 Sales

9,261kt

1 by 2007 Sales volume

32

Infrastructure - a unique competitive advantage

BELARUS

ROMANIA

RUSSIAN

FEDERATION

BLACK SEA

SEA OF

AZOV

Yuzhny

SevastopolYalta

Illichevsk

Kerch

Berdyansk

Mariupol

POLANDKiev

MOLDOVA

Odesa

FERREXPO

(Poltava GOK)

• Ferrexpo uses transport logistics

to customers as a competitive

advantage

• The seaport Izmail, in the Black

Sea, receives barge vessels

• The TIS-Ruda terminal at the

port of Yuzhny is designed to

receive Panamax vessels

• Rail links to domestic & European customers, and Black Sea ports

• Direct access to Dnipro River also allows transportation by barge

• Ownership of 49.9% of TIS-Ruda gives access to captive loading capacity at Port Yuzhny of up to

5mtpa

Rail

River Barge

TIS-Ruda

Ocean

Major Ports

Main railways

Ferrexpo site

Izmail

33

The case for blast furnace (BF) pellets

The trend is for lower cost of production and

lower impurity steel

• Lower Gangue content; especially SiO2.

Lower SiO2:

• lowers slag volumes

• lowers BF fuel usage rates

• improves productivity

• Low phosphorus. Critical for Flat Steel product producers

• Low alkalis.

• lowers coke rates

• assists to improve productivity

What Iron & Steelmakers need

Pellet consumption rate will increase in Blast

Furnaces

• High quality, direct charge lump supply is declining

• Direct charge materials will increase as iron makers

pursue:

• Lower Coke rates

• greater BF productivity

• Sinter plants are an environmental problem with high

SO2, NO2, CO2 output.

• Rapidly growing DR demand. CVRD and Samarco now

focusing more on DR

The case for BF pellets

1 Source: LKAB

Pellets are becoming the ‗preferred‘ feedstock - mitigated only by COST

34

Pricing: BF Pellets

• Future pellet consumption rates forecast to rise in all markets in reaction to:

• Environmental pressure on sinter plants

• Dwindling high quality lump ore supply

• BF Pellet prices at record levels in real terms (Vale BFP to Europe; 2008$)

• Conversion cost fines to pellets ~USc18/dmtu

• Premium last 10 years: USc20 to 85/dmtu

• 2008 Premium USc85.79/dmtu … due to extreme under-supply

132

182

51

142

111

36%37%

35%

23%

27%

0

20

40

60

80

100

120

140

160

180

200

A B C D E

10%

15%

20%

25%

30%

35%

40%

45%

A

%

35

Structural change underpins long-term price

132

182

51

142

111

36%37%

35%

23%

27%

0

20

40

60

80

100

120

140

160

180

200

A B C D E

10%

15%

20%

25%

30%

35%

40%

45%

A

%

Pellets

Fines

• Marginal cost of production (China, India

etc) seems to be growing faster than

median/average

• This has increased the theoretical LT

average margin for iron ore producers

• Implicit cost Inflation sources are funding

base cost & therefore will provide future

price support

• RAISES LT PRICE OUTLOOK

• IMPROVES AVERAGE INDUSTRY

MARGINS

36

How Ferrexpo pricing works

• International pricing typically normalised as ‗delivered at customer‘s plant‘

• Nothing new in Asian freight premia - Europe has priced on comparative landed cost for decades

• This ‗delivered price‘ actually computed into complex ‗value in use‘ (in the blast furnace) by customers to rank holistic attractiveness

of supply options

• International price forecasts for pellets typically based on FOB Tubarao

• However, Ferrexpo average DAF/FOB price receives a premium to FOB Tubarao price

• Largely due to transport costs

• Also can include logistics service premia from certain customers for ―JIT‖ (small lot, just in time) delivery

• Landed cost of Brazilian BF pellets (DAF/FOB + ocean freight + lightering + intra-Europe rail/barge) into Ferrexpo‘s major

Traditional market customers is significantly higher than that of Ferrexpo (rail direct, or rail + barge)

• Landed cost of such higher cost pellets plus value in use is Ferrexpo target pricing for its customers

• Ferrexpo has adopted a delivered price / value in use approach with its major customers in recent years, and is now seeking to

maximise its DAF/FOB prices on competitive value

• Based on 2008/9 pricing on our term contracts, Ferrexpo is running at an average c. $10/t higher than 2008/9 FOB Tubarao

benchmark price

• In Traditional markets (~80% of Ferrexpo sales) that premium is up to c. $19/t

• Accordingly, to convert an industry price; this premium must be added to the Vale BF pellets FOB Tubarao price to calculate

Ferrexpo prices

37

Forecasting Prices

Ferrexpo internally run „Floor‟ and „Long Run‟ price forecasts, defined as;

• Floor Price: lowest point it is expected that price may fall to for a short period of time

• Long Run Price: mid cycle price from approximately 5 years out and to about 20 years out

• Both types of forecast can be tested with simple scenarios driven by varying demand/supply outlooks

„Floor‟ approach:

• Based on belief that average industry price typically set based on cash cost plus minimum acceptable profit margin for majority of supply curve, and that lowest point in historic price curve was low point above cash cost (real)

• Escalating that Fines price low-point to the current year based on an assumption of industry cash costs movements gives a conservative Fines ‗Floor‘

• To this should be added the current cash cost of conversion of pellet fines to pellets to create a ‗Floor‘ pellet price

• Since this is a benchmark equivalent (FOB Tubarao), the Ferrexpo price premium is then added

„Long Run‟ approach:

• Several different approaches used, including

• Extrapolating industry cost curve, and estimating future cash cost of the ‗marginal supply‘

• Floor price + the Cost of attracting new greenfield entrants to invest/supply

• As with ‗Floor‘, this forecast yields a benchmark equivalent (FOB Tubarao), to which should be added the Ferrexpo premium

38

Marketing our increased production

0.0

20.0

2008 2009 2010 2011 2012 2017

MM

T

Years

Traditional Markets: BF Pellets Fair Market Share

versus Sales Forecast

Fair Market Share

0.00

5.00

2008 2009 2010 2011 2012 2017

MMT

Years

Ukraine: BF Pellets Fair

Market Share versus Sales

Forecast

Fair Market Share FPM Sales Plan

0.00

5.00

2008 2009 2010 2011 2012 2017

MM

T

Years

Natural Markets: BF Pellets Fair Market Share versus

Sales Forecast

Fair Market Share FPM Sales Plan

0.00

10.00

2008 2009 2010 2011 2012 2017

MM

T

Years

Growth Markets: BF Pellets Fair Market Share versus

Sales Forecast

Fair Market …

¹ Market constrained

² CRU data. F’cast to 2017 only

BF Pellets: the “Fair Share Test”

Ferrexpo‟s share of Global BF pellet exports¹ was 5%2 in 2007 and will be 8.9% in 2017

39

CURRENT OPERATIONS

MARKETING AND LOGISTICS

GROWTH PROJECTS

OVERVIEW

FINANCIALS

OUTLOOK

40

Ferrexpo‘s growth objectives

• Europe’s largest iron ore producer, by 2018

• Over 100 mtpa ore

• 35 mtpa products

• Supplier of choice to critical customer group

• Lowest cost quartile supplier into key markets

• 100% 65% BF pellets

• Technical feasibility of DR pellets confirmed

• Underpinned by integrated market services & logistics capability

• Ownership of logistics assets

• Maximising margins via supply chain control

41

0

10

20

30

40

50

60

70

80

90

100

110

120

2008 2011 2014 2017 2020 2023 2026 2029 2032

Current Extension Expansion

Yeristovskoye Belanovskoye Ore (Indicative)

Indicative production profile

Current mining

operations

Yeristovskoye

Belanovskoye

Galeschinskoye

Others

Ore (mt)

10.5mt

10mt

15mt

Over 100mtpa of iron ore and 35mtpa of pellets by 2018

Pellets

Dnieper River

42

Growth projects status – existing operations

• Projects

• Expansion of mine (15% production growth by 2011)

• Extension of mine life (beyond 2035)

• Upgrade first concentrator line to produce 65% pellets from lean ore

• Upgrade second concentrator line to produce 68% (DR) pellets

• Refurbish pelletiser for increased mine life and to realise design production capacity

• Capital expenditure

• $158m already approved for mine expansion and extension

• c. $350m required for processing plant upgrades

• Final Board approvals for remainder of capex expected in October

• Progress

• Expansion and extension on schedule and within budget

• Stripping for expansion of mine underway

• Resource restatement in June – c. 2bt additional resources

• Definitive Feasibility Study for beneficiation and pelletising plants nearing completion

43

Growth projects status – major growth projects

• Projects

• New c.27.5mtpa iron ore mine on Yeristovskoye deposit + processing plant

• New c.56mtpa iron ore mine on Belanovskoye deposit + processing plant

• Scoping study on potential of Galeschina hematite deposit completed

• Capital expenditure

• Indicative capex to develop Yeristovskoye and Belanovskoye approx $5-6 billion

• Progress - Yeristovskoye

• $100m pre-approval capex committed for draglines & mining equipment

• Ordered equipment arriving on site and in process of assembly

• Infrastructure & site preparation underway; pre-strip to commence in Nov 2008

• Definitive Feasibility Study to be complete by September

• Final Board approval expected in October

• Belanovskoye

• Pre-Feasibility assessment for Belanovskoye expected to be completed in Sept

44

Building the capability to deliver growth

• Operational capability

• Leveraging established capability at Ferrexpo Poltava Mining (FPM)

• New legal and operating entity being established for Yeristovskoye and Belanovskoye

(separate from FPM); senior management appointed

• DTP Terressment Alliance fully involved in managing Yeristovskoye mine development

• Project execution capability

• Worley Parsons (WP) fully engaged as project management partner

• WP/Ferrexpo team managing all GPL, Y, B and infrastructure project activities

• Formal alliance structure target for Q4 (WP and DTP)

• Major focus on developing Western execution capability while maximising Ukrainian

input

45

Strategic Investor (SI) Programme

• ‗In-house‘ capacity to finance GPL expansion & Yeristovskoye

• Potential to accelerate development of Belanovskoye

• Contemplating SI equity at the asset level in Y, B, G

• excluding existing GPL facilities

• Seeking project execution capability, technology, offtake in addition to funding

• Preliminary discussions have been held with several parties

• Investment bank has been engaged to formalise the process

• Completion target: end 2008

• Likely to be JV at the asset level

46

Indicative transaction structure

Yeristovskoye

Logistics

Ferrexpo AG

Marketing

Gorishne - Plavninskoye Lavrikovskoye – Northern Extension

Galeshchinskoye

Belanovskoye

FPM

JV

100%

100%

No

t le

ss

than

50%

Strategic Investor

Up

to

50%

Sales

Ferrexpo plc

47

CURRENT OPERATIONS

MARKETING AND LOGISTICS

GROWTH PROJECTS

OVERVIEW

FINANCIALS

OUTLOOK

48

Strong financial results in 2007

• Revenue up 28% to $698 million

• EBITDA up 65% to US$246m

• EBIT up 63% to $187 million

• Underlying earnings1 up 128% to $152 million

• Operating C1 costs increased 8.6% vs Ukrainian PPI of 23.3%

• Gearing reduced to 26% from 48%

¹ 'Underlying earnings' is an alternative earnings measure, which the directors believe provides a clearer picture of the underlying financial performance of the Group's

operations. Underlying earnings is presented after minority interests and excludes adjusted items.

Adjusted items are those items of financial performance that the Group believes should be separately disclosed on the face of the income statement to assist in the

understanding of the underlying financial performance achieved by the Group. Adjusted items that relate to the operating performance of the Group include impairment

charges and reversals and other exceptional items. Non-operating adjusting items include profits and losses on disposal of investments and businesses.

49

EBITDA and influencing factors

149.1

246.1

-3.2

97.3

37.72.6

-14.2 -1.0

2006 EBITDA Sales Price Sales Vol.

Own Ore

Other Sales C1 Costs Dist. Costs Purchased

Ore

Admin. 2007 EBITDA

-22.2

EBITDA waterfall 2006 – 2007 ($m)

50

EBITDA Margin

142

245

27%

35%

0

50

100

150

200

250

2006 2007

10%

15%

20%

25%

30%

35%

40%

45%EBITDA Margin

2 1

5%

10%

0

50

100

150

200

250

2006 2007

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%EBITDA Margin

EBITDA from own concentrate EBITDA from purchased concentrate

$m % $m %

51

Capital Structure and Debt

Multiple%

1,2

1 Net debt calculated as current interest bearing loans & borrowings + non-current interest bearing loans & borrowings + non-current trade & other payables – cash & cash

equivalents and short term deposits2 EBITDA is calculated as profit from continuing operations before tax and finance less foreign exchange (loss)/gain plus depreciation (included in both cost of sales and

administrative expenses) and non-recurring cash items included in other income, non-recurring cash items included in other costs plus disposal of subsidiaries and associates.

EBITDA is not a measure of financial performance under IFRS3 Total debt for the purposes of gearing is all interest-bearing debt, i.e. current interest bearing loans & borrowings + non-current interest bearing loans & borrowings. Gearing is

Total Debt / (Total Debt + Total Equity)

1.9x

0.5x

48%

26%

0x

1x

2x

3x

4x

5x

6x

2006 2007

5%

15%

25%

35%

45%

55%Net Debt/EBITDA Gearing• Benefits of debt restructuring in 2006

­ Reduced margins

­ Reduced effective borrowing cost

­ Extended tenor - less reliant on

expensive short term debt

• Increased capital base

­ Total assets up by 23%

• Rebalanced short and long term liabilities

• Improved working capital prospects

• Maintain prudent gearing levels

­ Throughout cycle

3

Strong unlevered balance sheet Capital Structure

52

Capital Expenditure

Capital Expenditure Split

Focus areas for future

• Current Pit (GPL) mine expansion &

processing upgrades

• Development of Yeristovskoye (Y)&

Belanovskoye (B)

• Further utility and logistics investments

Capex committed in 2007

• $158m for GPL expansion

• $47m on draglines for Y

• $55m mining equip for Y (Feb 2008)

Investment (Significantly Accretive Projects)

13

49

36

43

14

0

10

20

30

40

50

60

70

80

90

100

110

2006 2007

GPL Maintenance GPL Development Grow th Projects

53

Financial highlights – Income StatementUS$ ‗000 2007 $/tonne 2006 $/tonne

Revenue 698,216 72.33 547,310 61.83

C1 Cost of Sales (279,573) 31.794 (238,471) 29.264

Other Cost of Sales1 (56,363) (58,249)

Gross Profit 362,280 250,590

% Margin 52% 46%

Selling and distribution 100,614 10.865 86,376 9.885

G&A and other 44,560 4.815 43,635 4.995

Operating Profit 217,106 120,579

% Margin 31% 22%

EBITDA 246,057 26.575 149,142 17.065

% Margin 35% 27%

Profit before Taxation 160,760 80,737

Taxation 26,275 14,758

Effective Tax Rate 16.3% 18.2%

Profit for the Year 134,035 65,979

Underlying Earnings2 151,545 66,359

Underlying EPS 24.93 10.92

EPS 20.41 10.47

¹ Other Cost of Sales: depreciation, purchased concentrate and ore

² 'Underlying earnings' is an alternative earnings measure, which the directors believe provides a clearer picture of the underlying financial performance of the Group's

operations. Underlying earnings is presented after minority interests and excludes adjusted items.

Adjusted items are those items of financial performance that the Group believes should be separately disclosed on the face of the income statement to assist in the

understanding of the underlying financial performance achieved by the Group. Adjusted items that relate to the operating performance of the Group include impairment

charges and reversals and other exceptional items. Non-operating adjusting items include profits and losses on disposal of investments and businesses.

3 average pellet price 4 own ore 5 sales volume

54

Financial highlights – Balance Sheet

US$ ‗000 31.12.2007 31.12.2006

Non-Current Assets

Property, Plant & Equipment 364,545 301,343

Other 244,884 209,041

Current Assets

Inventories 56,545 48,487

Trade & Other Receivables 43,575 58,284

Other 71,426 73,525

Liabilities

Trade & Other Payables 23,477 12,214

Other 52,681 63,216

Capital employed 704,817 615,250

Net Financial Indebtedness 117,895 278,458

Equity 586,922 336,792

704,817 615,250

Key Ratios

Net Debt to EBITDA 0.5x 1.9x

Return on Capital Employed 19% 10%

55

Financial highlights – Cash Flow Statement

US$ ‗000 2007 2006

EBITDA 246,057 149,142

Working capital movements (1,766) (31,888)

Net financial payments (24,026) (27,495)

Income tax paid (32,018) (14,562)

Movement in provisions and other non-cash items 599 (6,897)

Net Cash Flows from Operating Activities 188,846 68,300

Sustaining CAPEX (49,821) (19,177)

Free Cash Flow 139,025 49,123

Development CAPEX (56,747) (29,583)

Purchases of investments (12,126) (3,119)

Proceeds from issue of share capital in Ferrexpo AG 0 109,329

Loans repaid by related parties 0 106,783

Acquisition of minority interest in subsidiaries 0 (231,945)

Acquisition of associate 0 (16,950)

Loans to Joint Venture (TIS-Ruda) (5,000) 0

Net IPO proceeds 153,424 (7,503)

Distributions (69,841) (31,766)

Other 11,828 5,983

(Increase) / decrease in Net Financial Indebtedness 160,563 (49,648)

56

Strong Balance Sheet and Cash Flows

US$ ‗000 2007 2006

Net Cash Flows from Operating Activities 188,846 68,300

Sustaining CAPEX (49,821) (19,177)

Development CAPEX (56,747) (29,583)

Net IPO proceeds 153,424 (7,503)

Distributions (69,841) (31,766)

Other (5,298) (29,919)

(Increase) / decrease in Net Financial Indebtedness 160,563 (49,648)

Key Ratios

Net Debt to EBITDA 0.5x 1.9x

Return on Capital Employed 19% 10%

57

CURRENT OPERATIONS

MARKETING AND LOGISTICS

GROWTH PROJECTS

OVERVIEW

FINANCIALS

OUTLOOK

58

Outlook for 2008 - Ferrexpo

• Positive market environment for iron ore pellets

• short term pricing extremely strong

• progress with building customer base and logistics for aggressive growth

• Incremental production & product quality improvements continuing

• Ukrainian and industry cost inflation challenges

• improvement programmes will continue to mitigate

• Acceleration of growth projects

• critical investment decisions H2

• funding and capability development options being pursued

• Group is well positioned for continued profitable growth

59

Demand - per capita steel consumption

Per capita steel consumption (kg)

Countries in „infrastructure building‟ mode can

rise to rates of 700 to 1,000kg/capita, then

settle back to long run of ~300kg/c

Per capita consumption is climbing rapidly in

Asia driven by investments in:

• industry

• transport infrastructure

• construction

• overall improved standards of living

Based on experience in Japan, S Korea &

Taiwan, China may have another 10 years of

strong consumption levels

India – significant forecast growth ...the next

China ???

Insert text here

132

182

51

142

111

36%37%

35%

23%

27%

0

20

40

60

80

100

120

140

160

180

200

A B C D E

10%

15%

20%

25%

30%

35%

40%

45%

A

%

Source: CRU

60

‗Steel super-cycle‘

…..So what has changed from past days of cyclicality?

• Structural demand growth explosion

China !!!

India

Eastern Europe re-industrialisation

Russia

Latin America

Asia

• Significant reduction in government ownership in global Steel capacity

• Iron ore industry highly consolidated. Profit driven players

• Cost curve dramatic change in last 5 years as China demand exploded

Flatter on low end. Steeper on high end driven by high cost new supply

= high cost marginal supply ~4 x higher than 2003 (Ave costs ~2 x)

= raises long term price

= improved industry average margins

Existing and new capacity cost inflation: Drivers: US$ weakness, energy costs, labour and logistics cost

• Next generation Tier-1 iron ore assets will be slow and high cost to commercialise….and possibly few

61

Demand and supply going forward

Seaborne Iron Ore

• Iron Ore supply-demand Forecast to be in deficit

2008-09. New supply capacity enters 2011-

2013, then trending to ‗managed balance‘

• 2011-13 potential oversupply moderated by;

• reduction in high cost supply from India and

China; which is positive for sea-borne iron ore

trade.

• Shelving of high cost, or geographically risky

projects

• Iron Ore Majors manage supply to cycle…..75%

of the planned new supply is from the ‗Big-3‘.

• Steel majors with upstream positions also

manage supply to cycles

• Premiums for high grade and direct-charge

feed (eg pellets) is likely to improve, especially

as China average grade is falling…possibly

rapidly

Steel feeds- tight for a few years yet

- transition into relative balance from 2013

-200

0

200

400

600

800

1000

1200

1400

1600

2007 2008 2009 2010 2011 2012 2013 2014

Seaborne

imports

Seaborne

exports

Surplus / deficit

MM

T

Source: UNCTAD, Citi Investment Research

62

Compelling investment case

The only pure play iron ore company in the FTSE 100

One of the largest iron ore resources in the world

Capacity to accelerate growth & value capture

Comprehensive plans to supply growing global markets

Location, location, location