JSW S.A.

Earnings Release • Apr 13, 2022

JSW Group's operating activity in Q1 2022

In Q1 2022, total coal production in the JSW Group was 3.77 million tons and coke production was 0.88 million tons.

Its operating results are depicted in the table below:

Production ratios	Unit	Period
		1Q 2021	Q4 2021	1Q 2022
Coal segment
(a+b) Total coal production:	mi llio n t on s	3.40	3.57	3.77
a) Coking coal production		2.77	2.75	2.86
b) Steam coal production		0.63	0.82	0.91
(a+b) Total coal sales:		3.82	3.80	4.06
a) Coking coal sales		2.99	2.77	2.92
including internal sales		1.22	1.14	1.24
b) Steam coal sales		0.83	1.03	1.14
Coke segment
Total coke production	mi to llio ns n	0.92	0.89	0.88
Sales of coke		1.01	0.88	0.95

Coal and coke production in the JSW Group

The operating results of the coal segment in Q1 2022 were as follows:

• total coal production was 3.77 million tons, up approx. 5.4% compared to Q4 2021 and up approx. 10.9% compared to Q1 2021;
• coking coal production was roughly 2.86 million tons, up approx. 3.9% compared to Q4 2021 and up approx. 3.3% compared to Q1 2021;
• steam coal production was roughly 0.91 million tons, up approx. 10.4% compared to Q4 2021 and up approx. 44.5% compared to Q1 2021;
• total coal sales were approx. 4.06 million tons, up approx. 6.7% compared to Q4 2021 and up approx. 6.1% compared to Q1 2021;
• total coking coal sales were approx. 2.92 million tons, up approx. 5.3% compared to Q4 2021 and down approx. 2.5% compared to Q1 2021;

inc.: internal sales were approx. 1.24 million tons, up approx. 8.4% compared to Q4 2021 and up approx. 1.4% compared to Q1 2021;

• total steam coal sales were approx. 1.14 million tons, up approx. 10.3% compared to Q4 2021 and up approx. 36.9% compared to Q1 2021;
• coal sales to external customers in Q1 2022 accounted for approx. 70% of the total volume.

The operating results of the coke segment in Q1 2022 were as follows:

• total coke production in Q1 2022 was 0.88 million tons, down approx. 1.9% compared to Q4 2021 and down approx. 4.5% compared to Q1 2021;
• total coke sales in Q1 2022 were 0.95 million tons, up approx. 7.2% compared to Q4 2021 and down approx. 6.3% compared to Q1 2021.

Market conditions in Q1 2022

• Coal segment¹
  • o the average price of The Steel Index (TSI) in October 2021 February 2022 affecting JSW's prices in Q1 2022 was USD 390. Compared to the average TSI price in July– November 2021 affecting the prices in Q4 2021, it grew 26%,
  • o the estimated average PLN price of coking coal sold by JSW to external buyers in Q1 2022 versus the previous quarter climbed by approx. 26%. Converted into USD at the National Bank of Poland's average exchange rate in a given quarter, the increase was approx. 24%,
  • o the ratio of the average price of JSW's coking coal sold to external buyers to the average TSI price in October 2021 - February 2022 was 85%. Compared to the previous quarter, it fell by 1 percentage point,
  • o the Polish Steam Coal Market Index (PSCMI1) in sales to the commercial and industrial energy sector stood at PLN 292.37 in Q1 2022 (data for January–February 2022) rose by approx. 19% compared to the previous quarter,
  • o the average price of steam coal sold by JSW in Q1 2022 in relation to the previous quarter increased by approx. 33%.

• Coke segment²

• o the prices of blast furnace coke in the European market in Q4 2021 was USD 630, up approx. 35% compared to Q3 2021,

• o the average PLN total contract price of coke sold by the JSW Group in Q1 2022 increased approx. 13% compared to Q4 2021. After conversion into USD at the National Bank of Poland's average exchange rate from the respective quarter, the growth was approx. 10%.

Data source: Platts, Coke & Anthracite Market Report, polskirynekwegla.pl

• the Q-1 method – quarterly benchmark prices calculated on the basis of the average prices in the previous quarter;

¹ JSW sets prices with its customers on the basis of benchmark prices based on the daily prices of Australian premium hard coking coal grades, in most cases by calculating their mean values by using two methods:

^- the Nippon Steel method – a quarterly benchmark price calculated as the average of the first two months of the current quarter and the last month of the previous quarter,

The above means that the average price of coking coal in a given quarter is influenced by prices over five months (from the previous quarter and the first two months of the current quarter)

² Coke prices are set at the turn of each quarter to reflect the market terms in negotiations. The optimal approach is to compare the prices obtained in a given quarter with the average price in the previous quarter.