NIS GROUP’S PERFORMANCE PRESENTATIONFor 2019

28th February, 2020Anton CherepanovFinance, Economics, Planning and Accounting Function

10 years of Gazprom Neft in Serbia

2

From 2009 over EUR 3 billion has been invested in NIS’ development

Bottom of the barrel -investment

worthwhile EUR 300 million

NIS operates a network of 400 petrol stations

NIS’ investments in social responsibility projects have exceeded EUR 30 million, while Gazprom Neft has invested over

EUR 45 million

-4.4

16.6

272.7

2009 2019 2009-2019 TOTAL

Net profit,bln RSD

10.4

44.5

524.3

2009 2019 2009-2019 TOTAL

EBITDA, bln RSD

9.1

42.2

372.4

2009 2019 2009-2019 TOTAL

CAPEX, bln RSD

1,004 1,286

15,933

2009 2019 2009-2019total

Oil and gas output, t.o.e.

2,657 3,373

33,795

2009 2019 2009-2019 TOTAL

Volume of refining of crude oiland semi-finished products,

thousand tonnes

2,5673,702

33,692

2009 2019 2009-2019 TOTAL

Volume sales, thousandtonnes

NIS in 2019

3

Experimental oil production began in Romania.

Drilling of 4 wells in Romania completed.

Continued exploration in B&H.

Start of electricity production in Jimbolia block.

45 development wells

and 11 exploratory

wells were drilled in Serbia

In Serbia, 700 km2 of 3D

seismic data obtained and

325 km2 in Romania.

CAPEX

21.3 bln RSD

EBITDA

34.2 bln RSD

The main goal of the Exploration and Production in 2019 was to reach the planned hydrocarbon output, implement theprojects concerning geological and exploration operations and increase the GTA efficiency.

Exploration and production Block

NIS in 2019

4

Implementation of capital turnaroundin 2019

Over RSD 2 billion invested, more

than 3,700 contractors engaged

CAPEX: 17.1 bln RSDEBITDA: 1.3 bln RSD

Continuous employee training in the DCU and OTS1

Implementation of digitaltransformation - Industry 4.0.

A record bitumen

output of 59 thousand tonnes in October

This year in the Refining Block has been marked by major activities and challenges such as the capitalturnaround of its refining capacities, reconstruction of the MHC/DHT Unit and the commencement of theconstruction of the Combined-Cycle Power Plant (TE-TO).The period after the capital turnaround was marked by a high refinery output, with October seeing the peak inbitumen production.

Downstream Division - Refining

1 OTS - operating training system

NIS in 2019

5

31 new private

label products were introduced.

Over one million On the Road with US card users at the end of 2019

In October, a record bitumen output of

59 thousand

tonnes was achieved

In Romania, a new M format PS constructed -

Otopeni PS (under

GAZPROM brand).After complete

reconstruction 5 PSs started operating in Serbia

In 2019, the modernization of retail network continued and three state-of-the-art digital petrol stations wereopened on Serbian motorways, setting exceptionally high standards in this field. The portfolio was additionallyexpanded for our customers, and NIS became the largest coffee chain in Serbia with over 300 points of sale.

CAPEX

3.0 bln RSD

EBITDA

18.3 bln RSD

Downstream Division – Sales and distribution

Downstream Division – Sales and distribution

6

Barajevo PS, XS size

Krnješevci PS, L-sizedmotorway PS

Velika Plana Autoput DesnaPS, M-sized motorway PS

Stari Banovci PS, L-sizedmotorway PS

PS Otopeni, M size

In 2019, in the whole region, thecustomers consumed over 6 millioncups of our coffee.

Romania

Ivanjica PS, S size

In 2019, 5 PSs started operating, and the construction of one PS was completed in Romania.

NIS in 2019

7

Approximately EUR 286.8 million was invested in the project

The detailed design was completed and all licenses obtained

100% of equipment and material were delivered

The construction and installation works on the complex are at 96.5%

Basic project parameters

Investment, mn. EUR 300

Start of production 2020

Coke furnace

Implementation of the Bottom of the Barrel Project in 2019:

Bottom-of-the barrel Project Coke belt conveyer and spherical tank

Bottom-of-the-barrel Project

8

Pipe bridge Wet gas compressor

Coke silos Coke belt conveyer

Bottom-of-the-barrel Project

9

Vessels installed

Main substation Coke crusher

Submersible pumps installed

NIS in 2019

1010

Project investments made in the amount of around EUR 97 mn., or 61% of the total projected amount

The engineering activities completed and building permits obtained for all construction stages of TE-TO Pančevo

Manufacturing of primary and auxiliary equipment completed. Complete equipment delivered to the site.

Basic project parameters

Expected total investments, mn. EUR up to 180

Nominal electric power of the power plant, МWt up to 200

Beginning of commercial operation Q4 2020

The overall progress of the project (as of December 2019) at the level of 80.62%.

Implementation of TE-TO Pančevo Project in 2019:

Steam-turbine plant

Gas-turbine plant

TE-TO Pančevo Project

TE-TO Pančevo project

11

Construction of 220kV Switching and Distribution Plant

Construction of 220kV Switching and Distribution Plant

Steel structure of utilizer boiler #1

Utilizer boilers #1 и #2

12

Macroeconomic IndicatorsDinar weakens, oil price drops

USD/RSD rate +5% Brent crude price, $/bbl -9%

94

98

102

106

110

I II III IV V VI VII VIII IX X XI XII55

60

65

70

75

80

85

I II III IV V VI VII VIII IX X XI XII

2018

Average 2018

2019

Average 2019

Diesel

(ULSD, 10ppm, FOB Med), crack

Petrol, (Parem Unl 10ppm, FOB Med), crack

Heavy fuel oil C, (3.5 PCT, FOB Med), crack

-0.2%+2% -9%

1.16

1.28

1.24

1.19

1.23

1.28

1.15

1.21

I II III IV V VI VII VIII IX X XI XII

2018 Average 2018 2019 Average 2019

1.23

1.29

1.14

1.23

1.30

1.32

1.14

1.22

I II III IV V VI VII VIII IX X XI XII

2018 Average 2018 2019 Average 2019

0.69 0.68

0.81

0.760.73

0.760.79

0.43 0.44

0.67

I II III IV V VI VII VIII IX X XI XII

2018 Average 2018 2019 Average 2019

Increasing transparency

LTIF RAR

HSE Indicators

13

2018 2019

61,378 65,388

1,104 1,327

77 84

9 0Majorevents

Medium events

Minorevents

HIPO

In 2019, no major HSE incidents were recorded, which is a highly positive trend compared to 2018, when 9 major HSE incidents were recorded.

2.22

1.67

2018 2019

2018

2019

25%

0.250.27

2018 2019

2018

2019

8%

14

Key IndicatorsNIS Group

Q4 2019

Q4 2018

∆ (%) Key indicators UoM 2019 2018 ∆ (%)

63.3 67.8 -7% Brent Dtd $/bbl 64.3 71.0 -9%

75.9 74.2 +2% Sales revenues bn RSD 272.1 281.0 -3%

13.3 11.7 +14% EBITDA bn RSD 44.5 53.7 -17%

5.9 3.4 +72% Net income bn RSD 16.6 25.1 -34%

15.0 4.7 +218% OCF bn RSD 56.9 37.4 +52%

53.1 50.5 +5% Accrued liabilities based on public revenues bn RSD 189.8 192.7 -2%

322 332 -3% Oil and gas output thou. TOE 1,286 1,332 -3%

1,055 1,067 -1% Crude oil and semi-finished products output thou. tons 3,373 3,836 -12%

1,081 1,008 +7% Total petroleum products sales volumes thou. tons 3,702 3,748 -1%

13.2 13.7 -4% CAPEX bn RSD 42.2 41.0 +3%

590 577 +2%Total debt to banks(total debt to banks + letters of credits)

mn EUR 590 577 +2%

15

Motor Fuel Market Trends2019/2018

Consumption of motor fuels in the region is on the rise. The key growth factors are:- positive macroeconomic trend;- growth of the transport, processing and construction industries.

Serbia

• Infrastructure works and very good agricultural and construction seasons had a positive impact on the consumption of diesel.

• Part of the diesel fuel consumption is returning from the grey zone to legal trade flows.

• The decrease in the consumption of LPG is the result of a drop in the number of vehicles using this fuel and high prices.

Slovenia

3.0%

Croatia

5.6%

Bosnia and Herzegovina

0.5%Bulgaria

1.4%

Romania

2.1%

Hungary

5.0%

Србија5.1%

16

Market Share – SerbiaPetroleum Products Market

The total consumption of petroleum products shows a positive growth trend. This was a result of the following factors:

• growth in consumption of diesel, bitumen and coke;

• construction and road industries are the main drivers of diesel consumption;

• good agricultural season.

Petroleum naphtha and heavy fuel oil experienced a downward trend in consumption (turnaround of Petrohemija).

3%Petroleum products market volumes, thou. tons1

NIS’ market share is traditionally quite substantial. Thelargest decrease in market share was recorded for bitumen(turnaround of the Refinery), but the market share was alsoindirectly affected by a significant boost in consumption ofcoke, which NIS does not supply to the market.

895(24%)

959(25%)

2,787(76%)

2,845(75%)

3,683 3,804

2018 2019

Others NIS

1Including CNG

17

Market Share – SerbiaMotor Fuel Retail Market

• Growth of retail market by 4.7%

• The key growth factors include an increase inpurchasing power and the number of vehicles,heavier transit traffic and the fact that a number oftransport and distribution companies have begunsupplying at our petrol stations (corporate cards).

+4.7%Retail market, thou. tons1

NIS’ sales are following the market trends and arerising in the diesel and petrol segments, whereasLPG sales are falling. Modernized petrol stations,range of additive-enriched fuels and attractiveloyalty programs maintain our already substantialmarket share.

973(57%)

1,015(56%)

744(43%)

783(44%)

1,717 1,797

2018 2019

Others NIS

1including CNG

18

Market Share – Region2019/2018

Bosnia and Herzegovina

No. of PSs : 37% total market: 23.7%% retail market: 10.1%

Romania

No. of PSs: 181

% total market: 0.9%% retail market: 1.2%

Bulgaria

No. of PSs: 35% total market: 5.0%% retail market: 4.4%

1 In 2019, construction and preparation for the start of operation of PS Otopeni in Romania was completed.

19

Operating IndicatorsExploration and Production

-3.4%Oil and gas output,thou. TOE

886 859

416 389

30 38

1,332 1,286

2018 2019

Domestic oil Domestic gas

Foreign projects

223 214 215 216 214

103 99 96 98 95

6 7 8 10 12

332 321 320 324 322

Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019

-3%

• The planned hydrocarbon production volume has been reached (2.1% more than planned)

• 2019 was marked by the beginning of experimental oil production in Romaniа

Increase in production of oil from foreign projects during 2019.

20

Operating IndicatorsRefining

-12%Refining of oil and semi-finished products, thou. tons• A 12% drop in the refining volume, resulting

from the capital turnaround in the Pančevo OilRefinery

222 130 212 276 217

774

429 338

767 768

71

40 55

7270

1,067

599 604

1,1151,055

Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019

-1%

881 835

2,6752,302

280236

3,8363,373

2018 2019

Domestic oil

Import oil

Semifinished products

21

• Retail in Serbia – 5% increase

• Wholesale in Serbia – 5% decrease

• Export – 12% decrease

• Foreign assets – 21% increase

Operating Indicators Sales and Distribution

-1%Sales volumes*, thou. tons

*Without internal sales

742 780

359 436

2,065 1,971

582 515

3,748 3,702

2018. 2019.

Retail - Serbia Foreign assets

Wholesale - Serbia Export

198 168 192 212 208 94 85 92 134 125

564 407 413

573 579

152

66 96

182 170 1,008

726793

1,101 1,081

Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019

+7%

22

• Decrease in oil prices on the global market

• Lower oil output

• Capital turnaround of the Pančevo Oil Refinery

Financial IndicatorsEBITDA

-17%EBITDA, bn RSD

53.744.5

2018 2019

11.76.3

9.6

15.3 13.3

Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019

+14%

23

Financial IndicatorsNet Income

• Lower EBITDA

• Greater depreciation

25.1

16.6

2018 2019

-34%Net income, bn RSD

3.40.2

3.1

7.55.9

Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019

+72%

24

Financial IndicatorsOCF

OCF, bn RSD

37.4

56.9

2018 2019

+52% • Lower liabilities for the imports of crude oil

• Lower liabilities towards the state

4.711.3

4.7

25.9

15.0

Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019

218%

Financial IndicatorsCAPEX

25

+3%CAPEX, bn RSD CAPEX by segments

41.0 42.2

2018 2019

51%

28%

12%

7%

0% 2%Block Exploration andproduciton

Bottom-of-the-barrelProject

DWS Refining

DWS Sales anddistribution

the rest of DownstreamDivision

Corporate centre

Operational Efficiency Improvement MeasuresEffect on EBITDA, bn RSD

26

• The overall effect of operational efficiency improvement measures in 2019 on EBITDA is RSD 1.8 billion.

1.8

1.80.5

0.4

0.40.4 0.02 0.1

1.3

3.1

Exploration andproduction

Services Refining Sales anddistribution

Technicalservices

Corporatecentre

NIS 2019 Perventeddamage

Total NIS 12M 2019

Measures Pervented damage

27

Debt to BanksMaturity and Currency Structure of Credit Portfolio

Debt to banks, mn EURBank indebtedness, mn EUR

Debt structure:USD 0.3% EUR 99.3% Other 0.4%

162

25

10

11

25

23

11

3

3

2

0

552

459

345

306

330

492

607

628

549

575

590

714

484

355

316

355

515

617

631

552

577

590

31.12.'09

31.12.'10

31.12.'11

31.12.'12

31.12.'13

31.12.'14

31.12.'15

31.12.'16

31.12.'17

31.12.'18

31.12.'19

Letter ofcredit

Debts tobanks

193

207

22

36

197

75

140

176

3

3

3

359

252

323

270

133

417

467

453

547

572

587

553

459

345

305

330

492

607

629

549

575

590

31.12.'09

31.12.'10

31.12.'11

31.12.'12

31.12.'13

31.12.'14

31.12.'15

31.12.'16

31.12.'17

31.12.'18

31.12.'19

up to 1 year

over 1 year

Benchmarking

28

EBITDA margin (%) EBITDA/FTE (thou. USD)* Daily volume (t/day)

Share of light products (%) UPS OPEX ($/boe)

32.5

26.0

16.4

14.5

13.6

20.6

253.0

111.0

69.6

48.8

33.6

103.210.0

8.8

7.7

7.0

6.6

6.2

7.7

11.1

9.1

6.7

6.2

N/D

8,3

Data obtained from 9M 2019 reports, except for NIS (12M 2019)*All data for 9M 2019

83.4

80.6

77.6

77.3

75.5

78.9

Business Plan 2020

29

The main focus in 2020 will be on the following:

Continuation of the investment programme – RSD 37.5 billion will be invested in the further development of NIS, in all segments

Continuation of digitization at all levels of NIS Improvement in the field of occupational safety and environmental protection

Exploration and Production- Implementation of the drilling programme and

geological exploration work on profitable projects in Serbia and foreign concessions

- Continuation of the trend of increasing the company`s reserves

Refining- Commissioning of the Delayed Coking Unit (DCU)

that utilises the bottom-of-the-barrel technology at the Pančevo Oil Refinery

Energy- Completion of the construction and

commissioning of TE-TO Pančevo

Sales and Distribution- Continuation of modernization of the retail

network in Serbia and the region- Sales development for the new product - coke,

further development of premium fuel sales

30

Conclusion

Lower oil price than in 2018

Low refining volume due to the capital turnaround

OCF growth

CAPEX growth

Improvement of LTIF in HSE

Q4 2019 was marked by an increase in sales (+2%), net profit (+72%), EBITDA (+14%) and OCF (+218%) in relation to the same period in the previous year

THANK YOU FOR YOUR ATTENTION!Investor.Relations@nis.eu

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