Interaction with Shareholders and Investors

MTS Securities

Dynamics of prices and volume of trading in MTS PJSC common shares

Trading platform: MOEX (Moscow), issuer code MTSS

Market capitalization of MTS PJSC, million roubles (MOEX)1

Market capitalization of MTS PJSC, million RUB (МОЕХ)

1 Capitalization is calculated as a product of the total amount of MTS PJSC shares and weighted average price of one share, calculated according to prices at the moment of closing of trade in MTS PJSC shares at Moscow Exchange.

Dynamics of prices and volume of trading in American Depositary Receipts of MTS PJSC

Trading platform: NYSE (New York), issuer code MBT

Dividends

Board of Directors and MTS executives understand that permanent stable dividends are the integral component of the investment appeal of MTS and profitability for the shareholders. Since 2010 MTS has paid in total over 235 billion RUB in annual dividends with average annual growth rate of 12% (at that, annual volume of payment grew by 69% from 2010 to 2015).

Being a leader among telecommunication companies that operates in rapidly developing and at the same time volatile markets, MTS has a goal to maintain a sufficient volume of resources and level of flexibility in order to reach its operational and financial targets. Experience shows that MTS always looks for ways to create a value for the shareholders through both commercial and financial strategies which can include both organic or non-organic development and Company’s practices in capital management.

In April 2016 the Board of Directors of MTS approved new dividend policies.

Following traditional practices, MTS will continue to pay dividends semi-annually, fulfilling its obligation on adding value for the shareholders. Board of Directors shall determine the amount of payments, considering a number of factors which include cash flows from operation activities, capital expenditures and debt standing of the company. Decisions on dividends shall be taken by the Board of Directors and then voted on at annual or extraordinary meetings of shareholders.

For the calendar years 2016 – 2018 MTS sets the goal to achieve a dividend profitability at the level of 25.0 – 26.0 RUB per one share, being obliged to pay as dividends at least 20.0 RUB per one share through two semi-annual payments. In addition, Company’s executives may determine ways to create an additional profitability with regard to the market situation, providing resources in amount up to 30 billion RUB within 3 years for repurchase of shares in the open market and their further redemption.

When deciding on an increase of income for the shareholders using a program on repurchase of shares, the Board of Directors shall consider a current availability of funds, operational indicators, amount of debt and future needs of the company, as well as general situation in the markets.

Regulation “On Dividend Policies” is published at the official website of MTS PJSC.

Report on payment of announced (accrued) dividends on MTS PJSC shares

Total amount of dividends accrued and paid in 2015 (according to the results of 2014 and first half of 2015) was RUB 52,011,421,978.35.

The Company has fully met its obligation to shareholders on payment of dividends.

Dividend accrual history

Interaction with Shareholders and Investors

One of the most important goals of the Company is to maintain strong trustful relationships with shareholders and investors, based on the principles of direct dialog in accordance with the effective legislation and prevalent international practices.

MTS PJSC tries its best to consider interests of investors and shareholders and to establish trustful relationships of MTS with partners through the improvement of transparency and openness of Company’s activities.

In accordance with the public availability principle the Company publishes information on significant events at the website of US Securities and Exchange Commission, of the Russian Information Agency (newsfeed), and at the official website of MTS: for shareholders and investors as well as in iOS application.

Besides, MTS publishes at its official website some other information. Sections “For investors and shareholders” and “Corporate Governance” include internal corporate documents, annual reports, reports on sustainable development, materials for shareholder meetings, information on the registrator and auditor, information on dividend policies, quarterly financial statements under IFRS and RAS, information on quoted prices of shares and bonds. Annual Report of MTS PJSC is also published in iTunes.

Maintenance and development of the effective dialog with equity market participants require a constant involvement of Company’s managers. MTS representatives regularly participate in international conferences, hold road shows and meetings with in investors, organize days of analysts.

Publication of financial results according to quarterly statements is carried out with phone conferences involving MTS managers. Published financial statements are supported by presentation materials for better coverage of achieved results and presentation of the Company’s strategy.

MTS strives to continuously improve interaction with investors and shareholders, using the experience of other companies and monitoring the latest legislation changes and advanced standards in this area.

In case of question related to MTS activities the investors may contact the services on interaction with shareholders and relations with investors

Corporate Governance Development of MTS PJSC:

Maxim Kalinin (Corporate Governance Director)

+7 (495) 911 6552. Fax: +7 (495) 911 6551.

E-mail: shareholder@mts.ru.

Department for Corporate Finances and Investor Relations of MTS PJSC:

Joshua Tulgan (Director of the Department)

+7 (495) 223 2025. Fax: +7 (495) 911 6588.

E-mail: ir@mts.ru.

Investor’s calendar for 20161

January 20–22, 2016 dbAccess CEEMEA Conference, London
January 18–22, 2016 Goldman Sachs Road Show, New York – Boston— Atlanta – Albuquerque — Dallas
March 21, 2016 Disclosure of financial and operational results for the 4th quarter of 2015
April 12–13, 2016 Exchange Forum 2016, The Ritz-Carlton, Moscow
April 25–26, 2016 UBS Emerging Market Dividend Conference, London
May 11–13, 2016 Morgan Stanley 3rd Flagship Global Emerging Markets Conference, London
May 2016 VTB Capital Investment Conference: London Session
May 19, 2016 Disclosure of financial and operational results for the 1st quarter of 2016
May 23–25, 2016 44th Annual J.P. Morgan Global Technology, Media and Telecom Conference, Boston
June 1–3, 2016 BofAML EM Corporate Credit conference, Miami, Florida
June 7–9, 2016 2016 Global Telecom & Media Conference, Bank of America Merrill Lynch, London
June 20–24, 2016 Renaissance Capital's 20th Annual Russia Investor Conference, Moscow
August 18, 2016 Disclosure of financial and operational results for the 2nd quarter of 2016
September 7–8, 2016 Deutsche Bank's GEMs conference in NYC
November 17, 2016 Disclosure of financial and operational results for the 3rd quarter of 2016
November 29 – December 2, 2016 WOOD’s Winter EME Conference, Prague
December 1–3, 2016 UBS Global Emerging Markets One-on-One Conference, New York

1 Dates can be specified.

The most significant events in the area of interaction with investors in 2016

For 2016 top managers of the Company are planning to actively cooperate with investors, participate in investment conferences, forums and road shows, organize meetings with representatives of stock exchanges and analysts of investment funds.

  • On January 2016 Alexey Kornya, member of the Management Board and Vice President for Finance and Investments has taken part in dbAccess CEEMEA Conference held in London.
  • A roadshow was held in several US towns from 18 to 22 January, 2016.
    During this event MTS managers met representatives of international investment funds: Charlemagne Capital, JP Morgan, T Rowe Price, UBS, HSBC Global Asset Management, Credit Suisse.
  • On April 12 and 13, 2016, managers of the Company participated in the Exchange Forum held in Moscow.
  • For May 2016 MTS managers are planning to take part in VTB Capital Investment Conference and Morgan Stanley 3rd Flagship Global Emerging Markets Conference (London), 44th Annual J.P. Morgan Global Technology, Media and Telecom Conference (Boston).

Matters of interest for investors

In 2015 we faced an aggressive behaviour of the main competitors in the area of distribution and this fact required taking protective measures in order to preserve the subscriber base and market share. It was decided to increase the amount of retail MTS stores to more than 5000, increase the share of sales of SIM cards in the home network, increase sales of smartphones and develop new services for promising Internet users. Also the focus was plaсed on a development of multi-brand network and online sales.

Our achievements

1. MTS won the award “For active corporate policies in disclosure of information”1

Judges including representatives of Interfax and AK&M information agencies, Bank of Russia, Moscow Exchange and Association of Independent Directors took into account regular phone conferences of the company with analysts and its briefings for journalists, high quality of its press releases, user-friendliness of the corporate website and full disclosure of information on the beneficiaries.

“MTS listed on the exchanges in Russia and abroad manages to maintain a balance between disclosure of information in all jurisdictions, providing for simultaneousness of making an important for investors information public in Russian and English. For us, it is an important sign of a conscious approach of the company to information transparency matters,” – said Vladimir Gerasimov, executive director of Interfax Group and the chairman of judges of the contest.

“Active interaction with the media, information openness and strict compliance with international standards of report disclosure are the important components in operation of any public company. And the fact that MTS team was acknowledged as the best player in the information field gives evidence that we approach the work with information professionally and passionately at all business levels – from well-timed and transparent communication of corporate news to investors and journalists to popularization of unique products at the crossing of telecom, online retail, banking, content and television,” said MTS President Andrey Dubovskov.

The honorary award was granted on December 1, 2015 during the ceremony of “Director of the year 2015” National Awards organized by the Association of Independent Directors and Russian Union of Industrialists and Entrepreneurs.

1 Award “For active corporate policies in disclosure of information” was established in 2003 for the companies that were the most successful in operative and full disclosure of information for the investors. Judges shall choose a winner based on completeness and timeliness of disclosure by companies of reports, corporate events, information on final beneficiaries, and on simultaneousness of disclosure for Russian and foreign investors as well as general assessment of company’s actions in the information realm.

2. Annual Report of MTS PJSC for 2014 won the Communications award in the open contest of annual reports of joint stock companies held by the Financial and Stock Market Department of Krasnodar Region