United Company RUSAL Plc: Results Announcement for the Three and Nine Months Ended 30 September 2013

  United Company RUSAL Plc: Results Announcement for the Three and Nine Months
  Ended 30 September 2013

Business Wire

HONG KONG -- November 11, 2013

RegulatoryNews:

United Company RUSAL Plc (Paris:RUSAL) (Paris:RUAL):

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong
Limited take no responsibility for the contents of this announcement, make no
representation as to its accuracy or completeness and expressly disclaim any
liability whatsoever for any loss howsoever arising from or in reliance upon
the whole or any part of the contents of this announcement.

                           UNITED COMPANY RUSAL PLC
        (Incorporated under the laws of Jersey with limited liability)
                              (Stock Code: 486)

                             RESULTS ANNOUNCEMENT
            FOR THE THREE AND NINE MONTHS ENDED 30 SEPTEMBER 2013


Key highlights of the quarter ended 30 September 2013





  *In the third quarter of 2013 the situation in the aluminium industry has
    remained particularly challenging. However the Company has managed to
    withstand the LME aluminium price reaching its lowest level since the
    second quarter of 2009 and reduce its net loss as compared to the previous
    quarter of the year thanks to measures aimed at improving business
    efficiency among other factors.

  *Total aluminium output amounted to 954 thousand tonnes in the third
    quarter of 2013, representing a decrease of 3.8% as compared to 992 tonnes
    for the previous quarter of the year as a result of the mothballed
    production at the least efficient European smelters in line with the
    ongoing capacity curtailment program.

  *Aluminium segment cost per tonne decreased by 2.0% to USD1,872 in the
    third quarter of 2013 in comparison with USD1,911 per tonne for the
    preceding quarter hitting new low since the end of 2010 supported by the
    depreciation of the Russian Rouble to the US dollar by 3.5% to RUB32.8 in
    the third quarter of 2013 from RUB31.7 for the previous quarter of the
    year. These factors allowed the Company to provide sound segment EBITDA
    margin of 9.8% in line with the industry best producers.

  *As a result the Company generated the Adjusted EBITDA of USD130 million in
    the third quarter of 2013, the same as for the respective period of the
    prior year, despite the 5.9% decrease in the aluminium sales volumes and
    7.1% decline in LME aluminium price for the comparable periods.

  *The Company reduced its Recurring Net Loss to USD132 million for the third
    quarter of 2013 from USD208 million for the preceding quarter despite the
    decrease in the LME aluminium price by 2.9%, from USD 1,835 to USD1,781
    for the respective periods.

  *On 1 October 2013 UC RUSAL Board of Directors announced the amendments to
    the initial Agreement with Norilsk Nickel, that guarantee stable dividends
    from Norilsk Nickel ensuring additional cushion for UC RUSAL.

Statement of the Chief Executive Officer

Under pressure from a continued decline in LME aluminium prices, in the third
quarter of 2013, the Company has continued to implement its inefficient
capacity mothballing programme and has continued to focus further on cost
controls. To ensure business efficiency, RUSAL temporarily ceased aluminium
production at the Volgograd, Volkhov and Urals aluminium smelters and at the
first phase of the Novokuznetsk aluminium smelter as well as certain potrooms
of the Bogoslovsk and Nadvoitsy aluminium smelters. Production volumes have
been also reduced at other production facilities.

As a result of these measures and also thanks to a move away from high cost
supplies and optimization of raw materials mix, RUSAL has reached a nearly
3-year low cash cost within the aluminium segment and also achieved a sound
segment EBITDA margin of 9.8%. Importantly, the Company has reduced its
recurring net loss in the third quarter 2013 to USD132 million as compared to
the previous quarter, and also improved other financial results. However,
conditions within the aluminium market remain challenging, and there is still
a long way to go before we see a marked improvement.

According to RUSAL’s estimates, global demand for aluminium will continue to
grow, improving by 6% per annum from 2013 through 2015. In the fourth quarter
this year, the Western aluminium market is expected to move to a production
balance deficit, however the situation is aggravated due to high stock levels
and the continued slow pace of curtailments of inefficient capacity by our
partners – leading international aluminium producers.

Oleg Deripaska
Chief Executive Officer

12 November 2013

Financial and Operating Highlights

                                                               Change                             Change
                                        Change     Three       quarter                            nine
               Three months ended 30  quarter   months     on        Nine months ended 30   months
                September               on         ended 30    quarter,   September               on nine
                                        quarter,   June        % (3Q to                           months,
                                        % (3Q to               2Q)                                %
                2013       2012        3Q)        2013                   2013       2012
                unaudited   unaudited              unaudited              unaudited   unaudited
Key operating
data
(‘000 tonnes)
Aluminium       954         1,042       (8.4%)     992         (3.8%)     2,953       3,135       (5.8%)
Alumina         1,802       1,740       3.6%       1,827       (1.4%)     5,440       5,671       (4.1%)
Bauxite         3,067       2,864       7.1%       2,941       4.3%       8,817       9,577       (7.9%)
                                                                                                  
Key pricing
and
performance
data
(‘000 tonnes)
Sales of
primary         969         1,030       (5.9%)     1,004       (3.5%)     2,967       3,192       (7.0%)
aluminium and
alloys
                                                                                                  
(USD per
tonne)
Aluminium
segment cost    1,872       1,936       (3.3%)     1,911       (2.0%)     1,919       1,949       (1.5%)
per tonne^1
Aluminium
price per       1,781       1,918       (7.1%)     1,835       (2.9%)     1,871       2,025       (7.6%)
tonne quoted
on the LME^2
                                                                                                  
Average
premiums over   272         226         20.4%    271           0.4%       269         194         38.7%
LME price^3
Average sales   2,078       2,115       (1.7%)   2,151         (3.4%)     2,179       2,217       (1.7%)
price
Alumina price   352         316         11.4%    327           7.6%       364         317         14.8%
per tonne^4
                                        
Key selected
data from the
consolidated
interim
condensed
statement of
income
(USD million)
Revenue         2,432       2,563       (5.1%)   2,521         (3.5%)     7,635       8,267       (7.6%)
Adjusted        130         130         0.0%     174           (25.3%)    550         694         (20.7%)
EBITDA
margin (% of    5.3%        5.1%        NA       6.9%          NA         7.2%        8.4%        NA
revenue)
Net Loss for    (172)       (118)       45.8%    (458)         (62.4%)    (611)       (117)       422.2%
the period
margin (% of    (7.1%)      (4.6%)      NA       (18.2%)       NA         (8.0%)      (1.4%)      NA
revenue)
Adjusted Net
Loss for the    (232)       (248)       (6.5%)   (191)         21.5%      (470)       (360)       30.6%
period
margin (% of    (9.5%)      (9.7%)      NA       (7.6%)        NA         (6.2%)      (4.4%)      NA
revenue)
Recurring Net
(Loss)/Profit   (132)       (76)        73.7%    (208)         (36.5%)    (288)       143         NA
for the
period
margin (% of    (5.4%)      (3.0%)      NA       (8.3%)        NA         (3.8%)      1.7%        NA
revenue)

^1 For any period, “Aluminium segment cost per tonne” is calculated as
aluminium segment revenue less aluminium segment results less amortisation and
depreciation divided on sales volume of the aluminium segment.
^2 Aluminium price per tonne quoted on the LME represents the average of the
daily closing official LME prices for each period.
^3 Average premiums over LME realized by the company based on management
accounts.
^4 The average alumina price per tonne provided in this table is based on the
daily closing spot prices of alumina according to Non-ferrous Metal Alumina
Index FOB Australia USD per tonne.

Key selected data from consolidated interim condensed statement of financial
position

                As at                                 Change nine months on
                 30 September 2013  31 December 2012   year end, %
                 (unaudited)
                                                        
(USD million)
Total assets     22,928              25,210             (9.1%)
Total working    1,811               1,893              (4.3%)
capital^5
Net Debt^6       10,142              10,829             (6.3%)

Key selected data from consolidated interim condensed statement of cash flows

                              Nine months ended                 Change nine
                                                                  months on
                                                   30 September
                               30 September 2013  2012           nine months,
                                                                  %
                               (unaudited)         (unaudited)
                                                                  
(USD million)
Net cash flows generated       337                 909            (62.9% )
from operating activities
Net cash flows generated
from/(used in) investing       833                 (24)           NA
activities
of which dividends from        522                 267            95.5%
Norilsk Nickel
of which CAPEX^7               (384)               (363)          5.8%
Interest paid                  (472)               (434)          8.8%

^5 Total working capital is defined as inventories plus trade and other
receivables minus trade and other payables.

^6 Net Debt is calculated as Total Debt less cash and cash equivalents as at
the end of any period. Total Debt refers to UC RUSAL’s loans and borrowings
and bonds outstanding at the end of any period.

^7 CAPEX is defined as payment for the acquisition of property, plant and
equipment and intangible assets.

Overview of trends in the aluminium industry

Global aluminium consumption

United Company RUSAL Plc (“UC RUSAL” or the “Company”, together with its
subsidiaries, the “Group”) estimates that in the nine months to 30 September
2013, global primary aluminium consumption has reached 37.5 million tonnes
which represents a 6% increase as compared to the corresponding period in
2012. The fastest growing markets in the period were China (11%), Turkey
(10%), and South East Asia (6%). North America experienced a 4% growth whereas
consumption growth improved by 1.5% in Europe.

Negative investor sentiment towards commodity markets resulting from lower
inflation forecasts, slower than expected growth in China and excess capacity
and supply over the coming years continued to pressure the LME price down to
an average of USD1,871 per tonne during the first nine months of 2013, a 7.6%
decrease compared to the same period in 2012.

China

China’s economic growth accelerated for the first time in three quarters –
Gross Domestic Product (“GDP”) rose by 7.8% in the July-September period from
a year earlier, according to the National Bureau of Statistics (“NBS”).
China's industrial production advanced in September by 10.2%, the NBS data
showed. The Chinese economy demonstrated strong growth in the third quarter of
2013 with production activity purchasing managers index rising to 51.1 in
September up from 51.0 in August.

Fixed-asset investment excluding rural households grew by 20.2% in the first
nine months of the year, compared with a 20.3% in the January-August period,
the NBS said. Compared with August, the latest indicators of construction
activity look extremely strong. New starts rose by 41% year-on-year in
September compared to a 20% contraction the month before, while floor space
under construction rose by 34% year-on-year compared to -25% in August.

Chinese demand for aluminium strengthened during the third quarter of 2013,
with higher orders reported from all the aluminium intensive sectors,
including construction, automotive, power, white goods and packaging.
Investment in property markets grew by 20.7% year-on-year during the second
quarter of 2013. Recent statistics from the China Association of Automobile
Manufacturers (CAAM) show that auto production in China amounted to 14.1
million units during the first eight months of 2013, representing an increase
of 13.2% year-on-year.

Total apparent aluminum consumption in China for the period January-September
2013 grew by 13% compared to the same period last year. Aluminum balance
continues to improve further, with 142 thousand tonnes of deficit in September
after 191 thousand tonnes of deficit in August. Based on January-September
2013 data there was 142 thousand tonnes of aluminum deficit in China.

For the first time in two years, the Chinese aluminium industry has
demonstrated widespread capacity slow down and a shutdown in central and
southern parts of China. During the January-September 2013 this amounted to
1.7 million tonnes per annum. An additional 400-500 thousand tonnes of
aluminum capacity have been announced for closure by the end of 2013. In
parallel to this, new capacity addition reached 2.7 million tonnes per annum,
for January-September this year and net increase of operating capacity
amounted to 1.4 million tonnes per annum, a much slower growth rate than was
initially expected.

China’s Ministry of Industry & Information Technology (“MIIT”) released the
State Council’s Guidelines on Addressing Severe Overcapacity, which also
applied to aluminum industry. New measures to tackle overcapacity in aluminum
industry provide for elimination of obsolete capacity (cells <160 kA), raise
of power tariffs for smelters with AC power consumption >13700 kWh*t. Local
governments are forbidden to introduce preferential electricity price
policies. Measures should be taken to relocate aluminum smelters to regions
where there is abundant hydro power or abroad, aluminum smelters are
encouraged to sign long-term power supply contracts with power plants.

North America

RUSAL estimates that North American aluminium demand increased by 4% in the
January- September 2013 as compared to the same period of 2012.

The transport sector remained the main driver of aluminium consumption growth
in the region, as vehicle production in the US increased by 3% in the first
eight months of 2013 in comparison to 2012. US light vehicle sales (SAAR) have
reached 15.28 million units in September 2013 showed 3.4% growth in comparison
to September 2012. The market’s SAAR expectation is 16 million vehicles by the
end of 2013. Recovery in the building and construction sector supported the
demand growth for aluminium in the period with USA housing starts (SAAR) came
to the number 891 thousand units in August, rose by 19% in comparison to 2012.
US economists forecast 980 thousand units by the end of 2013 giving higher
expectation for the fourth quarter of 2013.

Consumption of primary aluminium was also supported by tight scrap
availability, coupled with a higher price as a result of lower secondary
aluminium production.

Given the above factors, improvement in the demand for aluminium from the
physical market supported the Midwest premium in the first half of 2013 as it
rose from 11.0 US cents/lb in January to 11.85 US cents/lb by the end of June
2013. Premiums started to soften from July 2013, following information about
the LME’s proposal to change its warehouse policy and lawsuits filed against
the warehousing businesses of JP Morgan and Goldman Sachs. Due to the market
uncertainty surrounding the LME’s warehouse policy, the US Midwest premium has
settled at 9.80 US cents/lb by the end of September 2013.

Europe

In the third quarter of 2013 the European economy has shown more positive
signs of recovery with the Eurozone and wider EU28 emerging from recession in
the second quarter of 2013. During the second quarter of 2013, GDP rose by
0.3% in the Eurozone and by 0.4% in the EU27 compared with the previous
quarter. The Eurozone manufacturing sector expanded for the third straight
month in September 2013. This meant that growth was recorded throughout the
third quarter of the year to lift the sector out of its long-running
recession.

Aluminium demand in Europe is estimated to have improved in the third quarter
of 2013 growing by 1.5% year-on-year in the first eight months of the year.
The biggest rise came from Turkey (10%), Germany (3%), France (2%) and several
Eastern European countries. Similar to the US market, a scrap shortage has
opened the room for increasing primary aluminium demand in the region.

In the consumer market, European new car sales declined by 5.2% in
January-August of 2013 compared to the same period of 2012, falling to 8.1
million units. Germany, the leader of European automotive industry, showed 2%
production decline and 6.6% sales drop in the first eight months of 2013
compared to January-August 2012. Similarly a sales decline has also been noted
in France (-9.8%), Netherlands (-31.6%) and Italy (-9.0%). The UK was the only
market to perform better than in the first eight months of 2012, with sales up
10.4%. Automotive production in Europe continues to follow downward trend, but
with low pace. Germany shows clear sign of recovering with stabilization of
cars output in the nine months of 2013 in comparison to the same period of
2012.

The building and construction sector in Europe has been negatively affected by
the lack of credit and by the economic recession in the Mediterranean
economies. The latest available data shows decreasing production in
construction by 1.2% in EU28 in July 2013 vs July 2012. It had a direct impact
on the demand for aluminium products in the region during the first nine
months of 2013.

European primary ingots premium remained firm until July 2013 as, along with
America, uncertainty over the LME warehousing policy caused premiums to fall
with the expectation of spot metal availability from warehouses and
financiers. Premiums declined from 215 – 237 US$/t in July to 170 – 197 US$/t
at the end of September 2013.

Asia - Ex-China

The performance of the economies in South East Asia improved in the first half
of 2013 with strong GDP growth of 5-6% expected across the region this year.
Aluminium demand in developing South East Asian countries is estimated to have
grown by 10% in the first eight months of 2013 year-on-year. However, in
consideration of South East Asia, Japan and South Korea altogether, the region
marked a small decline in overall aluminium demand due to contraction of the
biggest individual market - Japan (-11%).

Automotive production in the region has increased by 5.6% in first eight
months of 2013. The Association of Southeast Asian Nations (“ASEAN”) countries
with Thailand ahead pointed 13% growth year-on-year basis. Auto output in
Japan has contracted by 9% on annual basis, but generally the tendency is
positive in the second half of 2013. The transport sector accounts for 43% of
aluminium demand in Japan. On the other hand new housing starts in July rose
year-on-year for the 11th consecutive month and are up by 9% year to date.

South Korea economic conditions started to improve as reflected by a 1.1% rise
of GDP during the second quarter of 2013, its fastest pace in two years. The
September announcement of government plans to raise fiscal expenditure next
year is expected to further boost economic growth, strengthening the case for
sustained recovery, with South Korean demand for flat rolled products (“FRP”)
set to improve. At 0.26 million tonnes per year, export demand for FRP was up
by 15% in the first eight months of 2013. Expansion of Novelis rolling
capacity by 0.35 million tonnes per year at Ulsan and Yeongiu, which are
reported to have started production this summer. South Korean exports have
been also benefiting from the Free Trade Agreement (“FTA”) with Europe, which
abolished the 7.5% duty and effectively reduced prices of sheet products by
around 250 USD/tonne.

The transport sector remained strong in South East Asia, with Thailand
continuing to be a leader in automotive production in the region with
1,542,440 produced vehicles in January-July 2013 and an annual growth of 21%.
Indonesia showed 11.3% growth in the comparable period of time. Construction
activity also grew in the region led by infrastructure development and housing
starts.

Construction, transport and electric sectors remain the key drivers of
aluminium consumption growth in India. However the uncertainty around India’s
political situation and economic policy present downside risks. The
construction sector has cited the lack of working capital and delays in
obtaining statutory clearances for construction starts as main obstacles to
growth. Furthermore, recent moves on monetary easing have stopped, as the
central bank shifts its focus towards maintaining financial and currency
stability – the tightening liquidity is expected to have a negative impact on
construction investment. Aluminium demand is forecast to have grown by 6% in
the first nine months of 2013.

In the Middle East region, aluminum demand is estimated to have increased by
6% in January - September of 2013 compared to the same period of 2012.

Premiums in Asia, as reflected by the CIF MJP (Cost, Insurance and Freight
Major Japanese Ports) indicator, remained firm but slightly declined from 250
US$/t in July to 245 - 246 US$/t in September 2013.

Aluminium industry 2013 full year outlook

UC RUSAL’s 2013 market outlook remains broadly unchanged, with some
improvement in demand growth in China based on the nine months of 2013 actual
data.

Consumption of primary aluminium globally is forecast to reach 51.2 million
tonnes, an increase of 6%, with growth in China to improve from previous 9.5%
forecast to 10% growth, followed by other largest growing markets with India
(6% growth), Asia excluding China (6% growth) and North America (5% growth).

Global aluminum production in 2013 is estimated at 50.9 million tonnes.

Overall, UC RUSAL forecasts the 2013 global aluminium market to be with some
280 thousand tonnes of deficit due to aluminum production curtailments and
continued robust growth in aluminum consumption.

RUSAL expects a deficit for the ex-China market at 437 thousand tonnes. The
Chinese aluminum market is expected to be balanced with a small surplus of 150
thousand tonnes.

Business review

Aluminium production

Primary aluminium production for the nine months ended 30 September 2013
amounted to 2,953 thousand tonnes demonstrating a decrease of 5.8% (or by 182
thousand tonnes) compared to 3,135 thousand tones for the first three quarters
of 2012. This dynamics reflect the ongoing capacity curtailment program and
was mostly attributable to the mothballed production at certain smelters
located in European part of Russia and Urals, in particular, Volgograd (VgAZ),
Urals (UAZ), Volkhov (VAZ), Bogoslovsk (BAZ), Nadvoitsy (NAZ) aluminium
smelters and first phase of Novokuznetsk (NkAZ) and ALSCON (Nigeria) aluminium
smelters.

Alumina production

Alumina output for the three quarters ended 30 September 2013 reached 5,440
thousand tonnes demonstrating a decrease by 4.1% compared to 5,671 thousand
tonnes for the first three quarters of 2012. The decrease was predominantly
attributable to the decline in the primary aluminium production.

Bauxite production

Bauxite production for the nine months ended 30 September 2013 was 8,817
thousand tonnes as compared to 9,577 thousand tonnes for the first three
quarters of 2012, demonstrating a 7.9% decrease matching the alumina
production dynamic.

Financial Overview

Revenue

                                        Change                   Change                                 Change
                                        quarter    Three         quarter                                nine
           Three months ended 30      on        months       on        Nine months ended 30       months
            September                   quarter,   ended 30      quarter,   September                   on nine
                                        % (3Q to   June          % (3Q to                               months,
                                        3Q)                      2Q)                                    %
            (unaudited)  (unaudited)              (unaudited)              (unaudited)  (unaudited)
            2013          2012                     2013                     2013          2012
(USD
million)
Sales of
primary
aluminium
and
alloys
USD         2,014         2,178         (7.5%)     2,160         (6.8%)     6,466         7,077         (8.6%)
million
kt          969           1,030         (5.9%)     1,004         (3.5%)     2,967         3,192         (7.0%)
Average
sales       2,078         2,115         (1.7%)     2,151         (3.4%)     2,179         2,217         (1.7%)
price
(USD/t)
Sales of
alumina
USD         151           132           14.4%      85            77.6%      377           414           (8.9%)
million
kt          494           429           15.2%      257           92.2%      1,176         1,299         (9.5%)
Average
sales       306           308           (0.6%)     331           (7.6%)     321           319           0.6%
price
(USD/t)
Sales of
foil (USD   77            78            (1.3%)     77            0.0%       232           220           5.5%
million)
Other
revenue     190           175           8.6%       199           (4.5%)     560           556           0.7%
(USD
million)
                                                                                                   
Total
revenue     2,432         2,563         (5.1%)     2,521         (3.5%)     7,635         8,267         (7.6%)
(USD
million)

Revenue decreased by USD632 million or 7.6% to USD7,635 million in the nine
months ended 30 September 2013, as compared to USD8,267 million for the
corresponding period of 2012.

Revenue from sales of primary aluminium and alloys decreased by USD611
million, or by 8.6%, to USD6,466 million in the nine months ended 30 September
of 2013, as compared to USD7,077 million for the same period of 2012. This
decrease resulted primarily from the decline in the LME aluminium price (which
decreased to an average of USD1,871 per tonne from USD2,025 per tonne for the
nine months ended 30 September 2013 and 2012, respectively) as well as from a
7.0% decrease in volumes of the primary aluminium and alloys sold. The
decrease in average LME aluminium prices was partially offset by a 38.7%
growth in premiums above the LME price in the different geographical segments
(to an average of USD269 per tonne from USD194 per tonne for the nine months
ended 30 September 2013 and 2012, respectively).

Revenue from sales of alumina decreased by USD37 million or 8.9% to USD377
million in the nine months of 2013 as compared to USD414 million for the
corresponding period of 2012, due to a 9.5% decrease in alumina sales volume
which was slightly offset by a 0.6% growth in average sales price.

Revenue from sales of foil increased by 5.5% to USD232 million in the nine
months of 2013, as compared to USD220 million for the corresponding period in
2012, primarily due to an increase in foil sales volume.

Revenue from other sales, including sales of other products, bauxite and
energy services were almost flat during the nine months ended 30 September
2013 as compared to the same period of 2012.

Cost of sales

The following table demonstrates the breakdown of UC RUSAL’s cost of sales for
the nine months ended 30 September 2013 and 2012:

                        Nine months ended 30 September  Change, %  Share of
                         2013             2012                       costs, %
                         (unaudited)       (unaudited)
                                                                      
(USD million)
Cost of alumina          788               1,020          (22.7%)     12.0%
Cost of bauxite          478               429            11.4%       7.3%
Cost of other raw
materials and other      2,297             2,459          (6.6%)      34.9%
costs
Energy costs             1,862             1,932          (3.6%)      28.3%
Depreciation and         378               389            (2.8%)      5.8%
amortisation
Personnel expenses       687               681            0.9%        10.5%
Repairs and              74                113            (34.5%)     1.1%
maintenance
Change in asset          -                 20             (100.0%)    0.0%
retirement obligations
Net change in
provisions for           9                 (2)            NA          0.1%
inventories
                                                                   
Total cost of sales      6,573             7,041          (6.6%)      100.0%

Total cost of sales decreased by USD468 million, or 6.6%, to USD6,573 million
for the nine months of 2013, as compared to USD7,041 million for the
corresponding period in 2012. The decrease was primarily driven by the 7.0%
(or 225 thousand tonnes) reduction in the aggregate volumes of aluminium sold.

Cost of alumina decreased in the reporting period (as compared to the nine
months of 2012) by 22.7%, primarily as a result of a decrease in both alumina
purchase volumes and average alumina purchase price.

Cost of bauxite increased by 11.4% in the nine months of 2013 as compared to
the same period of prior year, due to 12.0% growth in purchase volume.

Cost of raw materials (other than alumina and bauxite) and other costs
decreased by 6.6% due to the lower raw materials purchase price (such as
petroleum coke for 7.4%, fuel oil for 11.2%, anode blocks for 1.3%) and
purchase volumes for the nine months of 2013 as compared to the nine months of
2012.

Gross profit

As a result of the foregoing factors, UC RUSAL reports a gross profit of
USD1,062 million for the nine months ended 30 September 2013 as compared with
USD1,226 million for the same period of 2012, representing gross margins over
the periods of 13.9% and 14.8%, respectively.

Adjusted EBITDA and Results from operating activities

                                Nine months ended           Change nine months
                                                          on nine months, %
                                30 September
                                2013         2012
(USD million)                   (unaudited)   (unaudited)
                                                            
Reconciliation of Adjusted
EBITDA
Results from operating          28            31            (9.7%)
activities
Add:
Amortisation and depreciation   399           408           (2.2%)
Impairment of non-current       114           248           (54.0%)
assets
Loss on disposal of property,   9             7             28.6%
plant and equipment
                                             
Adjusted EBITDA                 550           694           (20.7%)

Adjusted EBITDA, defined as results from operating activities adjusted for
amortisation and depreciation, impairment charges and loss on disposal of
property, plant and equipment, decreased to USD550 million for the nine months
ended 30 September 2013, as compared to USD694 million for the corresponding
period of 2012. The factors that contributed to the decrease in Adjusted
EBITDA margin were the same that influenced the operating results of the
Company.

Results from operating activities decreased in the nine months ended 30
September 2013 by 9.7% to USD28 million, as compared to USD31 million for the
corresponding period of 2012, with the stable operating margins of 0.4% for
both periods.

Finance income and expenses

                                         Nine months ended
                                                                   Change, %
                                         30 September
(USD million)                            2013         2012
                                         (unaudited)   (unaudited)
                                                                     
Finance income
Interest income on loans and deposits    11            14            (21.4%)
Foreign exchange gain                    38            --            100.0%
Interest income on provisions            5             5             0.0%
                                         54            19            184.2%
                                                                     
Finance expenses
Interest expense on bank loans and
company loans wholly repayable within    (570)         (489)         16.6%
five years, bonds and other bank
charges, including
Nominal interest expense                 (491)         (428)         14.7%
Bank charges                             (79)          (61)          29.5%
Foreign exchange loss                    --            (52)          (100.0%)
Change in fair value of derivative       (11)          (78)          (85.9%)
financial instruments, including
Change in fair value of embedded         (11)          (75)          (85.3%)
derivatives
Revaluation of financial instruments
linked to the share price of Norilsk     --            (9)           (100.0%)
Nickel
Change in other derivatives              --            6             (100.0%)
instruments
Interest expense on provisions           (18)          (25)          (28.0%)
                                         (599)         (644)         (7.0%)

Finance income increased by USD35 million to USD54 million in the nine months
ended 30 September 2013 as compared to USD19 million for the corresponding
period of 2012, due to the net foreign exchange gain for the nine months ended
30 September 2013 as compared to the net foreign exchange loss for the same
period of the previous year.

Finance expenses decreased by USD45 million to USD599 million in the nine
months ended 30 September 2013 as compared to USD644 million for the
corresponding period in 2012 primarily due to the net foreign exchange gain
whereas the increase in the interest expenses was almost compensated by the
positive change in the fair value of derivative financial instruments.

Interest expenses on bank and company loans increased by USD81 million to
USD570 million for the reporting period as compared to the USD489 million for
the nine months of the previous year primarily due to the higher interest rate
margins and negative effect of interest rate swap.

Change in the fair value of derivative financial instruments comprised net
loss of USD11 million for the nine months ended 30 September of 2013 as
compared to the net loss of USD78 million for the same period of 2012 due to
the positive effect of the lower LME aluminium prices.

Foreign exchange results of USD38 million gain in the nine months ended 30
September of 2013 and USD52 million loss in the nine months ended 30 September
of 2012 were driven by the changes in working capital items of several Group
companies denominated in currencies other than their functional one due to
fluctuations in the exchange rate between the Russian Rouble and the US
dollar.

Share of profits/(losses) of associates and jointly controlled entities

                                         Nine months ended 30
                                                                   Change, %
                                         September
(USD million)                            2013         2012
                                         (unaudited)   (unaudited)
                                                                     
Share of profits of Norilsk Nickel,      204           577           (64.6%)
with
Effective shareholding of                27.82%        30.27%        NA
Share of losses of other associates      (23)          (27)          (14.8%)
                                                                     
Share of profits of associates           181           550           (67.1%)
                                                                     
Share of profits of jointly controlled   33            43            (23.3%)
entities

Share of profits of associates was USD181 million in the nine months ended 30
September 2013 and USD550 million for the corresponding period in 2012. Share
in results of associates in both periods resulted primarily from the Company’s
investment in Norilsk Nickel, which amounted to profit of USD204 million and
USD577 million for the nine months ended 30 September 2013 and 2012,
respectively.

Share of profits of jointly controlled entities was USD33 million in the nine
months ended 30 September 2013 as compared to USD43 million for the same
period in 2012. This represents the Company’s share of results in the
Company’s joint ventures — BEMO, LLP Bogatyr Komir, Mega Business and Alliance
(transportation business in Kazakhstan) and North United Aluminium Shenzhen
Co., Ltd (“North United Aluminium”).

Loss recycled from other comprehensive income

On 24 April 2013 the Group completed its disposal of 3,873,537 shares in
Norilsk Nickel to Crispian Investments Limited for USD620 million which was
settled in cash.

On the date of disposal the Group recycled USD230 million of accumulated
foreign currency translation losses and USD4 million of other losses relating
to shares sold from other comprehensive income recognized in equity to the
statement of income. The accumulated foreign currency translation losses of
USD230 million and USD4 million of other losses were accumulated while the
shares were recognized as part of the Group’s investment in an associate.

Net Loss for the period

As a result of the above, the Company recorded a net loss of USD611 million
for the nine months ended 30 September 2013, as compared to USD117 million for
the same period of 2012.

Adjusted and Recurring Net (Loss)/Profit

                                         Nine months ended
                                                                   Change, %
                                         30 September
                                         2013         2012
(USD million)                            (unaudited)   (unaudited)
                                                                     
Reconciliation of Adjusted Net Loss
Net loss for the period                  (611)         (117)         422.2%
Adjusted for:
Share of profits and other gains and
losses attributable to Norilsk Nickel,   52            (494)         N/A
net of tax effect, with
Share of profits, net of tax             (182)         (503)         (63.8%)
Revaluation of financial instruments
linked to the share price of Norilsk     --            9             (100.0%)
Nickel
Loss on disposal of Norilsk Nickel
recycled from other comprehensive        234           --            100.0%
income
Change in fair value of embedded
derivative financial instruments, net    (25)          3             N/A
of tax (20.0%)
Impairment of non-current assets, net    114           248           (54.0%)
of tax
Adjusted Net Loss                        (470)         (360)         30.6%
Add back:
Share of profits of Norilsk Nickel,      182           503           (63.8%)
net of tax
Recurring Net (Loss)/ Profit             (288)         143           N/A

Adjusted Net Loss for any period is defined as the net loss adjusted for the
net effect of the Company’s investment in Norilsk Nickel, the net effect of
embedded derivative financial instruments, the excess of effective interest
rate charges over nominal interest rate charges on restructured debt and the
net effect of non-current assets impairment. Recurring Net (Loss)/Profit for
any period is defined as Adjusted Net Loss plus the Company’s net effective
share in Norilsk Nickel results.

Segment reporting

The Group has four reportable segments, which are the Group’s strategic
business units: Aluminium, Alumina, Energy, Mining and Metals. These business
units are managed separately and results of their operations are reviewed by
the CEO on a regular basis.

The core segments are Aluminium and Alumina.

                        Nine months ended 30 September
                         2013                       2012
                         Aluminium    Alumina       Aluminium    Alumina
(USD million)            (unaudited)   (unaudited)   (unaudited)   (unaudited)
                                                                   
Segment revenue
kt                       3,022         4,501         3,263         4,911
USD million              6,574         1,525         7,219         1,652
Segment result           458           (196)         535           (133)
Segment EBITDA^8         774           (121)         858           (56)
Segment EBITDA margin    11.8%         (7.9%)        11.9%         (3.4%)
                                                                   
Total capital            247           122           226           120
expenditure

For the nine months ended 30 September 2013 and 2012 respectively, segment
result margins (calculated as the percentage of segment result to total
segment revenue) from continuing operations were 7.0% and 7.4% for the
aluminium segment, and negative 12.9% and 8.1% for the alumina segment. Key
drivers for the decrease in margins in the aluminium segment are disclosed in
“Revenue”, “Cost of sales” and “Adjusted EBITDA and Results from operating
activities” sections above. Detailed segment reporting can be found in the
consolidated interim condensed financial information as at and for the three-
and nine month periods ended 30 September 2013.

^8 Segment EBITDA for any period is defined as segment result adjusted for
amortisation and depreciation for the segment.

Capital expenditure

UC RUSAL recorded total capital expenditures of USD384 million for the nine
months ended 30 September 2013. UC RUSAL’s capital expenditure for the nine
months of 2013 was aimed at maintaining existing production facilities.

                           Nine months ended 30 September
                            2013             2012
(USD million)               (unaudited)       (unaudited)
Growth project
Taishet smelter             17                50
                            17                50
Maintenance
Pot rebuilds costs          121               103
Re-equipment                246               210
Total capital expenditure   384               363

The BEMO project companies utilise the project financing proceeds to make
necessary contributions to the ongoing construction projects and do not
require contributions from the joint ventures partners at this time.

Norilsk Nickel investment

The market value of UC RUSAL’s stake in Norilsk Nickel was USD6,401 million as
at 30 September 2013, as compared to USD8,143 million as at 31 December 2012
(excluding the shares clarified as held for sale as at that date) due to a
negative share price performance between the relevant dates.

The Group has previously issued interim condensed financial information as at
and for the three- and six-month periods ended 30 June 2013 dated 19 August
2013. At that date the Group was unable to obtain consolidated IFRS interim
financial information of the Group’s significant equity investee, OJSC MMC
Norilsk Nickel, as at and for three- and six-month periods ended 30 June 2013.
Consequently management estimated the Group’s share in the profits and
comprehensive income of this investee for three- and six-month periods ended
30 June 2013 based on information that was publicly available at that time. On
29 August 2013 OJSC MMC Norilsk Nickel published its unaudited financial
information prepared in accordance with IFRS as at and for the six-month
period ended 30 June 2013. Management has used this information to reassess
the Group’s share in the profits and other comprehensive income of the
investee and compare these amounts to their previous estimates. As a result of
this comparison, management has concluded that the Group’s share of profits
and other comprehensive income of associates for the three- and six-month
periods ended 30 June 2013 as well as the carrying amount of the Group’s
interest in associates as at 30 June 2013 reported in the Group’s interim
condensed financial information issued on 19 August 2013 do not require
restatement.

As stated in Note 12 to the consolidated interim condensed financial
information for the three and nine months period ended 30 September 2013, as
of the date of the consolidated interim condensed financial information, the
consolidated interim financial information of Norilsk Nickel for the three and
nine months period ended 30 September 2013 was not available to the Company
and as a result, the Company estimated its share in the profits, foreign
currency translation and other comprehensive income of Norilsk Nickel based on
latest publicly available information reported by Norilsk Nickel. The
information used as a basis for these estimates is incomplete in many aspects.
Once the consolidated interim financial information for Norilsk Nickel becomes
available, it will be compared to management´s estimates. If there are
significant differences, adjustments may be required to restate the Group´s
share in profit, foreign currency translation and other comprehensive income
and the carrying value of the investment in Norilsk Nickel which has been
previously reported.

The Company notes that its auditor, ZAO KPMG, has provided a qualified
conclusion in its review of the unaudited consolidated interim condensed
financial information of the Company for the three and nine months ended 30
September 2013 as it was unable to obtain and review the consolidated interim
financial information of Norilsk Nickel. An extract from the review report
provided by ZAO KPMG on the consolidated interim condensed financial
information of the Company dated 11 November 2013 is as follows:

“Basis for Qualified Conclusion

We were unable to obtain and review consolidated interim financial information
of the Group’s equity investee, OJSC MMC Norilsk Nickel (“Norilsk Nickel”),
supporting the Group’s share in the profit of that investee of USD94 million
and USD204 million for the three- and nine-month periods ended 30 September
2013, respectively, the Group’s share in other comprehensive income of that
investee of USD31 million and USD4 million for the three- and nine-month
periods ended 30 September 2013, respectively, the Group’s share in foreign
currency translation of that investee of USD62 million gain and USD551 million
loss for the three- and nine-month periods ended 30 September 2013,
respectively, and the carrying value of the Group’s investment stated at
USD8,324 million as at 30 September 2013. Had we been able to complete our
review procedures in respect of interests in associates, matters might have
come to our attention indicating that adjustments might be necessary to this
consolidated interim condensed financial information.

Qualified Conclusion

Based on our review, except for the possible effects of the matter described
in the Basis for Qualified Conclusion paragraph, nothing has come to our
attention that causes us to believe that the consolidated interim condensed
financial information as at 30 September 2013 and for the three- and
nine-month periods then ended is not prepared, in all material respects, in
accordance with International Financial Reporting Standard IAS 34, Interim
Financial Reporting.

Other matter

In our report dated 19 August 2013, we expressed a conclusion on the Group’s
consolidated interim condensed financial information as at and for the three-
and six-month periods ended 30 June 2013 that was qualified for the possible
effects of adjustments that might have been found necessary had we been able
to obtain and review consolidated interim financial information of the Group’s
significant equity investee, OJSC MMC Norilsk Nickel as at and for the three-
and six-month periods ended 30 June 2013. Since that date, management has
obtained the required information and has determined that it is not necessary
to adjust the accounting for the equity investee as described in note 10(b) to
the consolidated interim condensed financial information. We have reviewed
management’s assertion that no further adjustments are necessary and nothing
has come to our attention that causes us to believe that any adjustments are
required.”

Consolidated interim condensed financial information

The unaudited consolidated interim condensed financial information of UC RUSAL
for the three and nine months ended 30 September 2013 was approved by the
Directors of UC RUSAL on 11 November 2013, and reviewed by the Audit
Committee. It has also been filed with the French Autorité des marchés
financiers on the date hereof and is accessible on UC RUSAL’s website at
http://www.rusal.ru/en/investors/financial_stat.aspx.

Audit Committee

The Board established an audit committee (the “Audit Committee”) to assist it
in providing an independent view of the effectiveness of the Company’s
financial reporting process, internal control and risk management systems and
to oversee the audit process. The Audit Committee consists of a majority of
independent non-executive Directors. Members of the Audit Committee are as
follows: three independent non-executive Directors, being Dr. Peter Nigel
Kenny (Chairman), Mr. Philip Lader and Ms. Elsie Leung Oi-sie and two
non-executive Directors, Mr. Christophe Charlier and Ms. Olga Mashkovskaya
(with effect from 30 September 2013). On 08 November 2013, the Audit Committee
has reviewed the financial results of the Company for the nine months ended 30
September 2013.

Material events over the third quarter of 2013 and since the end of that
period

The following is a summary of the key events that have taken place over the
third quarter of 2013 and since the end of that period. All information
regarding key events that has been made public by the Company for the three
months ended 30 September 2013 and since the end of that period pursuant to
legislative or regulatory requirements, including announcements and press
releases, is available on the Company’s website (www.rusal.com).

4 July 2013        UC RUSAL announces a one-off employee share award
                    incentive plan.
                    UC RUSAL announces that the board of directors of the
                    Company has approved further steps in the reduction of
                    primary aluminium production at RUSAL’s less efficient
19 August 2013      aluminium smelters. As a result, the relevant expected
                    reduction will be approximately 357,000 tonnes by the end
                    of 2013 as compared to 2012, instead of 300,000 tonnes as
                    disclosed in RUSAL’s announcement dated 4 March 2013.
                    UC RUSAL announces an investment of almost RUR 3 bln in
12 September 2013   constructing new operational sites at SUBR (North Urals
                    Bauxite Mine) channeling some of these funds into
                    technical and equipment upgrade in 2013.
                    UC RUSAL announces signing of an agreement with the
27 September 2013   Ministry of Transportation of the Russian Federation and
                    the Government of the Krasnodar Territory to participate
                    in the creation Taman Dry-Cargo Port.
                    UC RUSAL announces signing of a memorandum of intent with
30 September 2013   the State Corporation ‘Bank for Development and Foreign
                    Economic Affairs (Vnesheconombank)’ (“VEB”) to convert
                    RUSAL’s loss-making smelters.
                    UC RUSAL announces an update on the settlement with
1 October 2013      Interros in relation to Norilsk Nickel and the dividend
                    policy of Norilsk Nickel.
1 October 2013      UC RUSAL announces appointment of a new chief financial
                    officer.

Compliance

Pursuant to Article L.451-1-2 IV of the French Code monétaire et financier,
the Company is required to publish quarterly financial information for the
first and third quarters of the financial year.

The Directors confirm that the information contained in this announcement does
not contain any false statements, misleading representations or material
omissions, and all of them jointly and severally accept responsibility as to
the truthfulness, accuracy and completeness of the content of this
announcement.

Forward-looking statements

This announcement contains statements about future events, projections,
forecasts and expectations that are forward-looking statements. Any statement
in this announcement that is not a statement of historical fact is a
forward-looking statement that involves known and unknown risks, uncertainties
and other factors which may cause our actual results, performance or
achievements to be materially different from any future results, performance
or achievements expressed or implied by such forward-looking statements. These
risk and uncertainties include those discussed or identified in the prospectus
for UC RUSAL. In addition, past performance of UC RUSAL cannot be relied on as
a guide to future performance. UC RUSAL makes no representation on the
accuracy and completeness of any of the forward-looking statements, and,

except as may be required by applicable law, assumes no obligations to
supplement, amend, update or revise any such statements or any opinion
expressed to reflect actual results, changes in assumptions or in UC RUSAL’s
expectations, or changes in factors affecting these statements. Accordingly,
any reliance you place on such forward-looking statements will be at your sole
risk.

                                         By Order of the board of directors of
                                                      United Company RUSAL Plc
                                                            Vladislav Soloviev
                                                                      Director

12 November 2013

As at the date of this announcement, the executive Directors are Mr. Oleg
Deripaska, Ms. Vera Kurochkina, Mr. Maxim Sokov, Mr. Vladislav Soloviev and
Mr. Stalbek Mishakov, the non-executive Directors are Mr. Dmitry Afanasiev,
Mr. Len Blavatnik, Mr. Ivan Glasenberg, Mr. Maksim Goldman, Ms. Gulzhan
Moldazhanova, Mr. Christophe Charlier, Ms. Olga Mashkovskaya and Ms. Ekaterina
Nikitina, and the independent non-executive Directors are Mr. Matthias Warnig
(Chairman), Dr. Peter Nigel Kenny, Mr. Philip Lader, Ms. Elsie Leung Oi-sie
and Mr. Mark Garber.

All announcements and press releases published by the Company are available on
its website under the links http://www.rusal.ru/en/investors/info.aspx and
http://www.rusal.ru/en/press-center/press-releases.aspx, respectively.

Contact:

United Company RUSAL Plc