IRC Limited — Board/Management Information 2016

Mar 15, 2016

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.

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(Incorporated in the Hong Kong with limited liability)

(Stock code: 1029)

DATE OF ANNOUNCEMENT OF ANNUAL RESULTS FOLLOWING DIRECTORS’ MEETING, PROFIT WARNING AND RE-DESIGNATION OF DIRECTOR

Wednesday 16 March 2016 : The Board of Directors (the “ Board ”) of IRC Limited (“ IRC ” or the “ Company ”, Stock Code: 1029) met on 8 March 2016 and resolved that the Executive Committee of the Board be authorised to, inter alia, consider and approve the annual results of the Company and its subsidiaries for the year ended 31 December 2015.

The Board hereby announces that a meeting of the Executive Committee will be held on Thursday, 31 March 2016 for the purpose of, inter alia, considering and approving the full year results of the Company and its subsidiaries for the year ended 31 December 2015 for publication.

It is expected that IRC will announce these results on 31 March 2016. A teleconference call will be held the same day at 09h00 Hong Kong time:

Access Number: +852 2112 1700 Participant PIN Code: 1635531#

Presentation slides to accompany the teleconference may be downloaded in advance at http://ircgroup.com.hk/html/ir_presentations.php

The Board further advises shareholders and potential investors that, pursuant to Rule 13.09 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance and based on the unaudited consolidated management accounts and current market information, the Group expects to record a greater net loss attributable to owners of the Company for the year ended 31 December 2015 as compared to that for the year ended 31 December 2014.

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As reported in the Group’s trading update for the third quarter and fourth quarter of 2015, cash costs at the Kuranakh mine has lowered significantly as a result of the successful ongoing cost optimisation programme and the depreciation of the Rouble. This has a positive impact to the Group’s operating results, with the estimated loss before impairment for the year ended 31 December 2015 reduced by approximately 45% over the same period last year. However, as guided in the fourth quarter trading update of the Group for 2015, following volatility in the global economy and further weakness in the global bulk commodity markets, as with most of IRC’s international competitors, the Board is contemplating recording partial impairment provisions of approximately US$437 million for the K&S Mine and US$43 million for the exploration and evaluation assets and other assets for the financial year ended 31 December 2015. These non-cash impairments of approximately US$480 million are not expected to have a material impact on the financial strength of the Group.

The Board considers that the overall financial position of the Group remains sound and solid. At the end of December 2015, the unaudited cash balance amounted to US$58.3 million which included US$2.1 million deposited in the debt service reserve account at ICBC, and does not include the fully funded bond payments that ICBC hold and which IRC may call upon in the event certain circumstances under the contract with CNEEC arise. Total debt outstanding was US$286.9 million made up of US$276.3 million of the ICBC project finance facility for K&S, and US$10.6 million of working capital facility for the Kuranakh project. In accordance with the ICBC project finance facility agreement, the Group replenished the debt service reserve account with US$26 million in January 2016.

As noted in the Group’s fourth quarter trading update of 2015, the Group is in discussions with ICBC and China Export & Credit Insurance Corporation regarding waivers in respect of the Group’s project finance facility with ICBC, including obligations to maintain certain cash deposits with ICBC, and the obligations of IRC and its guarantor Petropavlovsk plc to comply with certain financial covenants. Currently, these discussions are ongoing. If the waivers are not obtained, the Company’s auditors may not be able to provide an unqualified opinion in the Company’s audited financial reports for 2015 as to the Company’s ability to continue as a going concern.

The financial information contained in this announcement is based only on the Board’s preliminary assessment of the unaudited consolidated management accounts of the Group and other information currently available to the Company and may be subject to adjustments. It should be noted that the Company is in the process of finalising its results for the year ended 31 December 2015 and such results may be subject to further amendments as appropriate. Shareholders and potential investors are advised to read the Company’s results announcement for the year ended 31 December 2015 for further details, which is expected to be published on 31 March 2016.

Shareholders and potential investors are advised to exercise caution when dealing in shares of the Company.

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Changes to the Board

The Board announces that with effect from 16 March 2016, Mr Simon Murray, CBE, Chevalier de la Légion d’Honneur , (“ Mr Murray ”) has been re-designated from a NonExecutive Director of the Company to an Independent Non-Executive Director of the Company (the “ Re-designation ”) as recommended by the Nomination Committee of the Company and approved by the Board. Following the Re-designation, the Board comprises ten members with two Executive Directors, four Non-Executive Directors and four Independent Non-Executive Directors.

With reference to the announcement of the Company dated 20 January 2016, following the Re-designation, the Company is in compliance with Rules 3.10A of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “ Listing Rules ”) which requires that the Independent Non-Executive Directors of a listed issuer must represent at least one-third of its board of directors.

Mr Murray brings considerable Hong Kong and Asia based experience to the Board, from a career spanning Jardine Matheson, Hutchison Whampoa as the Group Managing Director, Executive Chairman, Asia Pacific of the Deutsche Bank Group and his current position as Chairman of GEMS Limited. Mr Murray is currently a Director of Cheung Kong Property Holdings Ltd., Orient Overseas International Ltd., Wing Tai Properties, Greenheart Group Ltd., Spring Asset Management Limited (the manager of Spring REIT), and China LNG Group Ltd., all are companies listed in Hong Kong. He is also the Non-Executive Director of Compagnie Financiere Richemont SA, a company listed overseas.

Mr Murray was the Non-Executive Chairman of Glencore International plc until May 2013, the Vice Chairman and Independent Non-Executive Director of Essar Energy plc until May 2014, the Chairman and Independent Non-Executive Director of Gulf Keystone Petroleum Ltd. until March 2015, and the Independent Non-Executive Director of Cheung Kong Holdings Ltd. until June 2015.

Save as disclosed above, Mr Murray has not held any directorship in other listed companies in Hong Kong or overseas in the last three years.

Mr Murray has entered into a supplemental letter of appointment with the Company in respect of his Re-designation to re-confirm that the term of service and remuneration contained in the letter of appointment prior to his Re-designation will continue and remain unchanged. Mr Murray does not have any interest in shares of the Company or its associated corporations within the meaning of Part XV of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong). Mr Murray does not have any relationship with any other directors, senior management, substantial shareholders or controlling shareholders of the Company.

Having regard that: (i) Mr Murray did not perform any executive role or management function in the Company or its holding company or any of their respective subsidiaries or any core connected persons of the Company before the date of this announcement; and (ii) since his appointment as a Non-Executive Director of the Company, Mr Murray has always been acting impartially, exercising independent judgment to the business and affairs of the Company, and providing professional and critical advice and recommendation to the Company, as if he was an Independent Non-Executive Director of IRC, the Company considers that his previous position as a Non-Executive Director has no bearing on his independence as an Independent Non-Executive Director, notwithstanding that such previous directorship may technically fall

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within the independence criterion under Rule 3.13(7) of the Listing Rules among the factors which may affect independence. Accordingly, the Board considers that Mr Murray satisfies all of the indicative criteria of independence set out under Rule 3.13 of the Listing Rules and hence is independent.

There is no information which is discloseable nor is/was Mr Murray involved in any of the matters required to be disclosed pursuant to any of the requirements of the provisions under paragraphs 13.51(2)(h) to 13.51(2)(v) of the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited, and the Board is not aware of any other matters which need to be brought to the attention of the shareholders of the Company.

The Board also further discloses that, following the announcement dated 20 January 2016, the Remuneration Committee has concluded its discussions with Mr. Danila Kotlyarov and Mr. Jay Hambro in relation to their respective remuneration. Under the service contract of Mr. Kotlyarov, he is entitled to receive a remuneration of US$37,868 (approximately HK$293,477) per month, and may be entitled to receive discretionary bonuses or other benefits as may be decided by the Remuneration Committee and the Board having regard to the Company’s and his performance. Mr. Hambro’s service will be rendered through his affiliated company where it is entitled to a remuneration of US$14,583 (approximately HK$113,018) per month, and may be entitled to receive discretionary bonuses or other benefits as may be decided by the Remuneration Committee and the Board having regard to the Company’s and his performance.

By Order of the Board IRC Limited Yury Makarov Chief Executive Officer

Hong Kong, People’s Republic of China Wednesday, 16 March 2016

As at the date of this announcement, the Executive Directors of the Company are Mr Yury Makarov and Mr Danila Kotlyarov. The Non-Executive Directors are Mr George Jay Hambro, Mr Cai Sui Xin, Mr Liu Qingchun and Mr Raymond Kar Tung Woo. The Independent NonExecutive Directors are Mr Daniel Bradshaw, Mr Simon Murray, CBE, Chevalier de la Légion d’Honneur , Mr Chuang-Fei Li and Mr Jonathan Martin Smith.

IRC Limited

6H, 9 Queen’s Road Central Hong Kong Tel: +852 2772 0007 Fax: +852 2772 0329 Email: ir@ircgroup.com.hk Website: www.ircgroup.com.hk

For further information please visit www.ircgroup.com.hk or contact:

Shirly Chan

Manager – Communications & Investor Relations Telephone: +852 2772 0007 Mobile: +852 9688 8293 Email: sc@ircgroup.com.hk

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