IRC Limited — Capital/Financing Update 2018

Nov 28, 2018

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 Hong Kong with limited liability) (Stock code: 1029)

UPDATE ON K&S REFINANCING

Wednesday, 28 November 2018: This announcement is made by IRC Limited (“ IRC ” or the “ Company ”, together with its subsidiaries, the “ Group ”; Stock Code 1029) pursuant to Rule 13.09(2) of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “ Stock Exchange ”) (“ Listing Rules ”) and the Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong).

As set out in the Company’s announcement dated 24 September 2018, a leading Russian bank informed the Company that its credit committee has granted approval, subject to the entry into legally binding agreements, for a new US$240 million facility (the “ New Facility ”) to be provided to LLC KS GOK, a wholly owned subsidiary of the Company (the “ Borrower ”). If progressed, the New Facility would be utilised to repay the ICBC facility in full of c.US$204 million, to repay the bridge loan (the “ Bridge Loan ”) advanced by Petropavlovsk to IRC in June 2018 in the amount of c.US$30 million, and to repay the guarantee fee of c.US$6 million owed by the Group to Petropavlovsk in respect of the ICBC facility. The New Facility would require Petropavlovsk to continue providing a guarantee (the “ Guarantee ”). Under the proposed arrangements, the full release of Petropavlovsk’s obligations under the Guarantee will happen in stages and it is anticipated that a reduction in Petropavlovsk’s guarantee obligations to zero will be achieved before the end of 2020.

The Company reports that significant progress has been made in connection with the New Facility and formal documentation is being finalised. It is expected that the New Facility will be entered into in mid-December 2018, conditional upon, among other things, entry into the Guarantee, which is subject to the approval of Petropavlovsk’s shareholders in a general meeting. A circular (the “ Petropavlovsk Circular ”) to convene the general meeting of Petropavlovsk and setting out full details of the New Facility and Guarantee will be distributed to Petropavlovsk’s shareholders shortly thereafter. On this basis, it is anticipated that the replacement of the ICBC Facility will take place in January 2019, subject to Petropavlovsk’s shareholders approving the transaction.

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The next scheduled repayment instalment under the ICBC Facility of US$29.75 million is due on 20 December 2018 (the “ December Repayment ”). IRC and Petropavlovsk are discussing obtaining a waiver from ICBC in respect of the December Repayment and it is hoped that this would be received during December and prior to the next scheduled repayment date on 20 December, as well as prior to the publication of the Petropavlovsk Circular. In addition, the Company and Petropavlovsk are in discussions for Petropavlovsk not to take any action or exercise its right to demand repayment of the Bridge Loan until the New Facility is complete and has been drawn down (and the Bridge Loan repaid).

The implementation of the refinancing transaction described herein remains subject to the negotiation and execution of legally binding finance documentation, the perfection of security and other conditions precedent typical for a transaction of this nature. The Board of IRC will continue discussions with ICBC, the Russian bank, and other interested parties regarding this project financing and other alternatives to service the December Repayment in the event a waiver from ICBC is not forthcoming. No decisions have been made to commit to any party.

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

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

Hong Kong, People’s Republic of China Wednesday, 28 November 2018

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 Peter Charles Percival Hambro and Mr Chi Kin Cheng. The Independent Non-Executive Directors are Mr Daniel Bradshaw, Mr Chuang-Fei Li, Mr Simon Murray, CBE, Chevalier de la Légion d’Honneur, Mr Jonathan Martin Smith and Mr Raymond Kar Tung Woo.

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:

Kent Lo

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

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