KGHM Polska Miedź S.A.

Earnings Release • Dec 22, 2021

Preliminary production and sales data of the KGHM Polska Miedź S.A. Group for November 2021

The following report contains preliminary monthly data – the final quarterly and annual production and sales results will be published in the consolidated annual report for 2021. Data of the KGHM Polska Miedź S.A. Group contain the results of Sierra Gorda reflecting the 55% share held by KGHM Polska Miedź S.A.

In the period January-November 2021 the production of all of the main metals by the Group was above the levels set forth in the budget for this period.

Results of the KGHM Group in November 2021 - y/y:

Production and sales of the KGHM Group	November 2021	November 2020	I - XI 2021	I - XI 2020
Production
Payable copper (kt)	60.5	62.4	696.1	644.4
- including KGHM Polska Miedź S.A.*	46.6	48.4	535.6	509.2
Payable silver (t)	131.8	104.4	1 235.1	1 226.2
TPM (koz t)	13.1	18.0	148.5	179.8
Molybdenum (mn lbs)	0.5	0.6	8.1	8.5
Sales
Copper (kt)	68.7	66.6	671.6	639.5
Silver (t)	114.5	105.3	1195.6	1243.7
TPM (koz t)	19.0	17.7	142.4	185.5
Molybdenum (mn lbs)	0.6	0.7	7.4	8.9

* Production of electrolytic copper

Production of the KGHM Group:

• Production of payable copper amounted to 60.5 thousand tonnes, or a decrease by 3% compared to the amount recorded in corresponding month of 2020, due to lower production by KGHM Polska Miedź S.A. (-4%) and by the segment KGHM INTERNATIONAL LTD. (-15%).
• Production of payable silver amounted to 131.8 tonnes, or an increase by 27.4 tonnes (+26%) compared to the amount recorded in corresponding month of 2020, due to the greater availability of charge materials at the Precious Metals Plant of the Głogów Copper Smelter and Refinery.
• Production of TPM amounted to 13.1 thousand troy ounces and was lower by 4.9 thousand troy ounces (-27%) compared to November 2020, mainly due to lower production of gold by the segment KGHM Polska Miedź S.A.
• Production of molybdenum amounted to 0.5 million pounds, or a decrease by 17% compared to November 2020, due to the lower molybdenum content in ore processed by the Sierra Gorda mine.

Sales of the KGHM Group:

• Sales of copper amounted to 68.7 thousand tonnes and were higher by 2.1 thousand tonnes compared to sales in November 2020, or an increase by 3% year-on-year. Higher copper sales were recorded by KGHM Polska Miedź S.A (+4%) and by KGHM INTERNATIONAL LTD. (+9%). The Sierra Gorda mine sold less copper in the given period by 0.5 thousand tonnes (-5%).
• Sales of silver amounted to 114.5 tonnes and were higher by 9.2 tonnes than sales in the corresponding period of 2020 (+9%). The increase is mainly due to higher sales of silver by the Polish production assets.
• Sales of TPM amounted to 19.0 thousand troy ounces and were higher by 1.3 thousand troy ounces (+7%) than sales in November 2020. This result was due both to higher sales by KGHM Polska Miedź S.A. by 0.8 thousand troy ounces as well as to higher sales by KGHM INTERNATIONAL LTD. by 0.6 thousand troy ounces. Lower sales were recorded by the Sierra Gorda mine.
• Sales of molybdenum amounted to 0.6 million pounds and were lower by 0.1 million pounds (-14%) compared to November 2020. Lower molybdenum sales were recorded by the Sierra Gorda mine as well as by the assets of KGHM INTERNATIONAL LTD.

Results of KGHM Polska Miedź S.A. in November 2021 - y/y:

Production and sales of KGHM Polska Miedź S.A.	November 2021	November 2020	I - XI 2021	I - XI 2020
Mine production:
Copper in concentrate (kt)	32.0	33.1	362.2	364.6
Silver in concentrate (t)	111.1	103.4	1 205.0	1 130.0
Metallurgical production:
Electrolytic copper (kt)	46.6	48.4	535.6	509.2
- including from own concentrate	31.5	42.8	354.5	371.1
Metallic silver (t)	129.0	101.0	1 204.9	1 199.3
TPM (koz t)	6.4	11.5	72.7	89.2
Sales
Copper (kt)	53.9	51.8	519.0	501.2
Silver (t)	111.8	101.1	1166.7	1211.4
TPM (koz t)	11.9	11.1	73.8	90.4

Production of KGHM Polska Miedź S.A.:

• Production of copper in concentrate amounted to 32.0 thousand tonnes and was lower by 1.1 thousand tonnes (-3%) compared to November 2020. The decrease in production was due to lower processing of ore by the mines.
• Production of silver in concentrate amounted to 111.1 tonnes and was higher by 7.7 tonnes (+7%) compared to November 2020, due to the higher content of this metal in ore.
• Production of electrolytic copper amounted to 46.6 thousand tonnes and was lower by 1.8 thousand tonnes (-4%) compared to November 2020. The decrease in cathode production was the result of the execution of adopted targets in the production plan for 2021.
• Production of metallic silver amounted to 129.0 tonnes and was higher by 28.0 tonnes (+28%) compared to November 2020. The increase in production of metallic silver was due to the higher availability of charge materials at the Precious Metals Plant.

Sales of KGHM Polska Miedź S.A.:

• Sales of copper amounted to 53.9 thousand tonnes and were higher by 2.1 thousand tonnes (+4%) compared to sales in November 2020. The small increase in sales was mainly due to logistical factors and to the schedule of deliveries agreed with customers – due to the fact that the majority of production facilities operate until approx. 17 December 2021, some of December's tonnage was delivered to customers somewhat earlier, in the last week of November 2021.
• Sales of silver amounted to 111.8 tonnes and were higher by 10.7 tonnes (+11%) compared to November 2020. This was due to higher production as compared to November 2020 and to the schedule of deliveries to customers.
• Sales of TPM amounted to 11.9 thousand troy ounces and were higher by 0.8 thousand troy ounces (+7%) compared to November 2020. The increase was due to the schedule of deliveries to customers.

Results of KGHM INTERNATIONAL LTD. in November 2021 - y/y:

Production and sales of KGHM INTERNATIONAL LTD.	November 2021	November 2020	I - XI 2021	I - XI 2020
Production
Payable copper (kt)	5.1	6.0	66.2	60.8
TPM (koz t)	3.6	3.9	47.7	62.0
Sales
Copper (kt)	6.0	5.5	60.7	65.4
TPM (koz t)	4.1	3.5	40.9	66.6
Silver (t)	0.1	0.6	1.7	7.3

Production of KGHM INTERNATIONAL LTD.:

• Production of copper amounted to 5.1 thousand tonnes and was lower by 0.9 thousand tonnes (-15%) compared to November 2020 due to lower production of copper by all of the mines of KGHM INTERNATIONAL LTD. apart from the Carlota mine. The decrease was due to lower monthly production by the Robinson mine (-804 tonnes – lower copper content in ore and a planned decrease in the volume of ore processed). This decrease in November 2021 results from the adopted strategy of blending ore and should not have an impact on the Robinson mine's achievement of its annual production plan. The lower production by the Franke mine by 56 tonnes was due to lower ore quality, while lower copper content in ore and lower extraction by the Sudbury Basin resulted in lower production of payable copper by 38 tonnes compared to November 2020.
• Production of TPM amounted to 3.6 thousand troy ounces and was lower by 0.3 thousand troy ounces (-8%) compared to November 2020, mainly due to lower production by the Sudbury Basin (-0.3 thousand troy ounces – lower precious metals content in ore, with lower extraction).

Sales of KGHM INTERNATIONAL LTD.:

• Sales of copper amounted to 6.0 thousand tonnes and were higher by 0.5 thousand tonnes (+9%) compared to sales in November 2020. The main reason was higher sales of copper from Robinson mine concentrate, due to higher payable copper content in ore (the amount of copper concentrate sold remains at a similar level). Higher sales were recorded by the Carlota mine due to higher production of cathodes. Slightly lower sales of copper cathodes were however recorded by the Franke mine. Despite the higher copper content in ore from the Sudbury Basin a lower result by 0.1 thousand tonnes was recorded compared to November 2020 due to a lower volume of ore sold.
• Sales of TPM amounted to 4.1 thousand troy ounces and were higher by 0.6 thousand troy ounces (+17%) compared to the corresponding period of 2020. The main reason was higher gold content in concentrate from the Robinson mine. The Sudbury Basin recorded higher sales of gold, while in the case of platinum and palladium the results were slightly lower compared to the corresponding period of 2020.
• Sales of silver amounted to 0.1 tonnes and were lower by 0.5 tonnes compared to November 2020, due to a lower level of sales of silver from Robinson concentrate. The main reason for this decrease was lower silver content in copper concentrate compared to previous shipments. A decrease in silver sales by approx. 0.1 tonnes was recorded by the Sudbury Basin (lower silver content in ore).

Results of Sierra Gorda S.C.M. in November 2021 - y/y:

Production and sales of Sierra Gorda (on a 55% basis)	November 2021	November 2020	I - XI 2021	I - XI 2020
Production
Payable copper (kt)	8.8	8.0	94.3	74.4
Molybdenum (mn lbs)	0.5	0.6	7.9	8.1
Payable silver (t)	2.7	3.2	28.3	25.5
TPM (koz t)	3.1	2.6	28.1	28.6
Sales
Copper (kt)	8.8	9.3	91.9	72.9
Molybdenum (mn lbs)	0.6	0.7	7.3	8.3
Silver (t)	2.6	3.6	27.2	25.0
TPM (koz t)	3.0	3.1	27.7	28.5

Production of Sierra Gorda (55%):

• Production of payable copper amounted to 8.8 thousand tonnes and was higher by 0.8 thousand tonnes (+10%) compared to November 2020. The increase in payable copper production in November 2021 compared to November 2020 was due to higher copper content in mined ore. The increase in payable copper production in the period January-November 2021 compared to the corresponding period of 2020 was due to higher copper content in mined ore, higher metal recovery and a higher volume of ore processed.
• Production of molybdenum amounted to 0.5 million pounds and was lower by 0.1 million pounds (-17%) compared to November 2020. The decrease in molybdenum production in November 2021 compared to November 2020 was due to lower metal content in mined ore, which was partially offset by higher metal recovery. The decrease in molybdenum production in the period January-November 2021 compared to the corresponding period of 2020 was due to lower metal content in mined ore, which was partially offset by higher metal recovery and a higher volume of ore processed.

Sales of Sierra Gorda (55%):

• Sales of copper amounted to 8.8 thousand tonnes and were lower by 0.5 thousand tonnes (-5%) compared to sales in the corresponding period of 2020. The reason for the decrease was a lower volume of copper concentrate sold in November 2021 (by approx. 5.7 thousand tonnes dry weight) due to the schedule of planned deliveries.
• Sales of molybdenum amounted to 0.6 million pounds and were lower by 0.1 million pounds (-14%) compared to November 2020. The level of sales of molybdenum reflects the schedule of processing molybdenum concentrate and the return of molybdenum oxides designated for sale as well as the planned and achieved level of molybdenum production by the Sierra Gorda mine.
• Sales of silver amounted to 2.6 tonnes and were lower by 1.0 tonnes (-28%) compared to sales in November 2020. The main reason was lower sales of copper concentrate and the lower content of this metal in concentrate.
• Sales of TPM amounted to 3.0 thousand troy ounces and were lower by 0.1 thousand troy ounces (-3%) compared to the corresponding period of 2020. Lower gold content in copper concentrate combined with lower sales of copper concentrate was the reason for the lower sales compared to November 2020.