General information

This Integrated Annual Report 2022 of Samruk-Energy JSC (hereinafter referred to as the Report) is the 16th paper disclosing information on financial and economic performance and operations, as well as the Company's sustainability achievements. The Report is addressed to a wide range of stakeholders.

Developed in line with GRI Standards, the Report showcases the financial and non-financial performance of Samruk-Energy JSC in projects implemented both in and outside Kazakhstan. The non-financial elements of the disclosure are shown predominantly for subsidiaries and associates owned 50% or more by the Company, i.e. across the Group.

GRI 2-4

Compared to the Company's Integrated Annual Report 2021, there have been changes in the Report with respect to certain indicators, as well as in the disclosure of additional indicators. Detailed explanations are given in the body of the Report.

The financial indicators are denominated in the national currency of Kazakhstan, KZT (tenge) and correspond to the IFRS audited consolidated financial statements.

The Report comprehensively discloses:

• Implementation of the Samruk-Energy Development Strategy;
• Management's approach to corporate governance;
• Significant financial, economic and production targets and performance in core operations;
• HSE performance;
• Contribution to the local development, implementation of social policy and other sustainability aspects.

To designate Samruk-Energy Group (Samruk-Energy JSC and its subsidiaries), the Report uses the names: “Samruk-Energy”, “Company”, “Group”, and "we".

Statutory Requirements

The Report discloses key data as required by the laws of the Republic of Kazakhstan, internal requirements and regulations of the Company, and international corporate governance practices. The Report relies on the following papers:

• Law No. 415-II of the Republic of Kazakhstan dated 13 May 2003 On Joint Stock Companies
• Rules for information disclosure by the issuer, Requirements for the content of information to be disclosed by the issuer, and the terms for information disclosure by the issuer on the Internet resource of the Depository of financial statements as approved by the Resolution No. 189 adopted by the Board of the National Bank of the Republic of Kazakhstan on 27 August 2018
• Regulatory requirements of Kazakhstan Stock Exchange (KASE), and Astana International Exchange (AIX)
• International integrated reporting standard (IR International Framework)
• International standard for sustainable development reporting, Global Reporting Initiative, including GRI 12: Coal Sector
• АА1000SES Stakeholder Engagement Standard
• Ten principles of UN Global Compact
• UN Sustainable Development Goals 2030
• ISO 26000:2010 Social Responsibility Guidance Standard
• Recommendations of the TCFD (The Task Force on Climate-related Financial Disclosures) Working Group of the Financial Stability Board (partial disclosure)

We strive to develop our reporting in terms of applicable standards, disclosing GRI industry indicators and taking into account TCFD recommendations. We consider interactivity and cross navigation as key features of this Report. It offers links not only to corporate documents, but also to our website, where we have outlined our key governance practices.

Scope of the Report

GRI 2-3

The scope of the Report corresponds to the annual reporting cycle of the Company. The previous Report was published in July 2022. Electronic copies of the reports for the previous years are available on the official websitе of the Company. The current Report discloses the operations and performance of Samruk-Energy JSC for the period from 1 January 2022 to 31 December 2022.

For the purpose of internal control and risk management in financial reporting, the Samruk-Energy Management Board adopted Matrices of Risks and Controls in Accounting and Financial Reporting of Samruk-Energy JSC on 16 March 2020 (Minutes No. 5)

The matrix shows a map of accounting and financial reporting processes at all levels of the Group (subsidiaries, affiliates, joint ventures, and the Fund) and includes five stages:

1. Formalisation of the financial reporting process

2. Reconciliation of intra-group and related-party transactions

3. Data collection for the consolidated financial statements

4. Preparation of consolidated financial statements

5. Approval of consolidated financial statements.

In general, the document includes matrices on the following processes:

1. Preparation of financial statements

2. Procurements and settlements with creditors

3. Fixed and intangible assets accounting

4. Treasury accounting

5. Dividend accounting

6. Financial aid accounting

7. Tax accounting

8. Employee remuneration accounting

9. Accounting of business trip expenses

10. Investments

11. Borrowings

12. Inventories.

The Financial Reporting Preparation process adjusts for key risks and controls, from formalisation of financial reporting, period closure, preparation of separate financial statements, and preparation of consolidated financial statements to the preparation of financial disclosures. The matrix features 50 control procedures to minimise key five risks in preparations of consolidated financial statements.

The Company's high-risk culture based on three lines of defence and a focus on continuous improvements ensure that the risk matrix and checkpoints of the financial reporting process are observed and up-to-date.

The Report includes important facts that fall beyond the reporting period but are directly related to it, as well as the medium-term plans of the Group. The Report discloses information on the most significant results of the operations of Samruk-Energy JSC, its subsidiaries and associates. During data collection, all data of quantitative and qualitative nature across the entire Group, which can have a significant impact on making an informed decision on a significant issue, event or decision, is taken into account and disclosed. We are consistently developing a system of work with sustainable development indicators and aims to align the disclosure perimeter with the financial data disclosure to the full amount in the near future.

GRI 2-2

To ensure a holistic approach to financial reporting, Samruk-Energy applies the equity method of consolidation. Furthermore, the current accounting policy establishes that fixed and intangible assets are carried at historical cost, i.e. without revaluation. Subsidiaries are included in the consolidated financial statements using the acquisition method of accounting. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured at their fair values at the acquisition date, irrespective of the size of any non-controlling stake.

Considering the above, the equity method excludes the turnover of large companies such as Ekibastuz GRES-2 and Forum Muider B.V. in which Samruk-Energy JSC holds a 50% stake from the consolidated balance sheet. For the consolidated financial results of Samruk-Energy JSC, the share of profit of these companies is presented as the profit/loss of equity-accounted entities and impairment of equity method investment.

For independently assured indicators, data were consolidated using the operational control approach (GRI 302-1, 303-3, 303-4, 303-5, 305-1, 305-2, 305-7, 401-1, 401-3, 404-1, and 403-9).

Principles for Defining Report Quality

The following key GRI principles ensure the quality of the Report:

Feedback

Samruk-Energy JSC invites to share feedback to further improve the Integrated Annual Report and disclosures to stakeholders. The Company would appreciate it if you completed an online questionnaire posted on the website of Samruk-Energy JSC in the interactive version of this Report.

GRI 2-3

You can share your views on the 2022 Report and ask questions about the Report by contacting us, using the contact details below.

External assurance

GRI 2-5

We ensure transparency and independent assurance of disclosed information. We have therefore received external assurance from PricewaterhouseCoopers on the financial information included in the 2022 Integrated Annual Report and on selected non-financial information.

PricewaterhouseCoopers audited the financial statements prepared in accordance with applicable law and International Financial Reporting Standards (IFRS) as adopted by the UK and issued by the IASB.

In addition, PwC assured selected non-financial information published in line with GRI Standards.

Forward-looking statements

This Report should be read in its entirety, taking into account all the sections, notes and explanations contained herein, including the information set out in this section.

This Report has been prepared on the basis of information available to Samruk-Energy JSC as of 31 December 2022, unless otherwise follows from the meaning or content of such information.

Forward-looking statements are not based on current circumstances and include all statements concerning the Company's intentions, opinions or current expectations with regard to its performance and the implementation of its development strategy. By their very nature, forward-looking statements involve risks and uncertainties because they relate to future events and circumstances that may or may not occur.

To describe the future, the terminology is used that includes words such as “believes”, “evaluates”, “expects”, “forecasts”, “intends”, “plans”, “assesses”, “will” or “may”, or in each case, comparable words and terms, as well as negating statements or references to projects are designed to identify statements regarding the future. These assumptions involve risks and uncertainties that are either foreseeable or not foreseeable by the Company. Therefore, future performance may differ from current expectations and recipients of the information in the Report should not base their assumptions solely on it.

Samruk-Energy gives no assurance that the actual results, scope or performance of its business or the industry in which the Company operates will match the results, scope or performance expressed or implied by any forward-looking statements contained in this Report or elsewhere.

Samruk-Energy shall not be liable for any losses that may be incurred by any person due to such person's reliance on forward-looking statements. Except where expressly required by the applicable laws, the Company assumes no obligation to distribute or publish any updates or changes to forward-looking statements to reflect any changes in expectations or new information, or subsequent events, conditions or circumstances.

Social performance

GRI 2-7, 405-1, GRI 12: Coal Sector: 12.19.6

HEADCOUNT

TOTAL WORKFORCE BY ROLE AND GENDER, EMPLOYEES

TOTAL WORKFORCE BY AGE AND GENDER

TOTAL WORKFORCE BY GENDER AND REGION

REGULAR AND TEMPORARY EMPLOYEES BROKEN DOWN BY GENDER AND REGION⁴²

GRI 401-1, GRI 12: Coal Sector: 12.15.2

NEW EMPLOYEE HIRES BY GENDER, AGE, AND REGION⁴³

DISMISSED EMPLOYEES BY GENDER, AGE, AND REGION⁴³

GRI 401-3, GRI 12: Coal Sector: 12.15.4, 12.19.4

KEY PARENTAL LEAVE INDICATORS, EMPLOYEES⁴⁴

GRI 404-1

AVERAGE HOURS OF TRAINING OF PER EMPLOYEE PER YEAR BY GENDER AND EMPLOYEE CATEGORY, 2022⁴⁵

GRI 2-21

RATIO OF HIGHEST PAID TO THE REST

GRI 202-1, GRI 12: Coal Sector: 12.19.2

RATIOS OF STANDARD ENTRY LEVEL WAGE COMPARED TO LOCAL MINIMUM WAGE

GRI 405-1, GRI 12: Coal Sector: 12.19.6

DIVERSITY OF GOVERNANCE BODIES BY GENDER, 2022⁴⁶

Occupational health & safety

GRI 403-9

KEY H&S INDICATORS

HEALTH AND SAFETY EXPENDITURES, '000 KZT

Environmental indicators

ENVIRONMENTAL INVESTMENTS, BILLION KZT

EMISSIONS PAYMENTS (TAXES) AND OBLIGATORY ENVIRONMENTAL PAYMENTS, BILLION KZT

GRI 305-7, GRI 12: Coal Sector: 12.4.2

POLLUTION DISCHARGES, TONNES

GRI 303-3, GRI 12: Coal Sector: 12.7.4, 12.7.6

TOTAL WATER WITHDRAWAL BY SAMRUK-ENERGY, MEGALITRES

GRI 303-5

TOTAL WATER CONSUMPTION BY SAMRUK-ENERGY, MEGALITRES⁴⁸

GRI 303-4, GRI 12: Coal Sector: 12.7.5

TOTAL WATER DISCHARGE BY SAMRUK-ENERGY, MEGALITRES

GRI 306-4, GRI 12: Coal Sector: 12.6.5

WASTE GENERATED BY SAMRUK-ENERGY AND SENT FOR RECOVERY, TONNES

GRI 306-5, GRI 12: Coal Sector: 12.6.6

WASTE GENERATED BY SAMRUK-ENERGY AND SENT FOR DISPOSAL, TONNES

GRI 302-1

RESOURCE CONSUMPTION AND ENERGY EFFICIENCY, '000 GJ^51,52,53

Investment performance

IMPLEMENTATION OF SAMRUK-ENERGY INVESTMENT PROGRAMME IN 2022, UTILISATION RATE, KZT MILLION (EXCL. VAT)

Financial and business performance

GRI 201-1

GENERATED AND DISTRIBUTED ECONOMIC VALUE OF SAMRUK-ENERGY JSC (INCLUDING STAKES IN JOINT VENTURES), KZT MILLION

GRI 201-1

KEY FINANCIAL AND ECONOMIC INDICATORS, KZT MILLION

PROFIT AND EXPENSES, KZT MILLION

Operations performance

PRODUCTION INDICATORS (BY PRODUCER)

WEIGHTED AVERAGE TARIFFS FOR ELECTRICITY GENERATION

AIX – Astana International Exchange, a stock exchange for investment in Kazakhstan and Central Asia, established under Astana International Financial Centre. AIX's mission is to develop sound and liquid capital markets in Central Asia and beyond by offering innovative products and services to businesses and investors.

CAPEX – Capital expenditure.

Samruk-Kazyna Sovereign Wealth Fund – a Kazakh investment holding company founded in 2008 to promote Kazakhstan's national welfare and modernise the national economy. The Government of Kazakhstan is the sole shareholder of the company.

ADCS – automated dispatch control system designed to monitor and control the operation of the equipment.

Electricity balance of a grid – a system of indicators to show the match between electricity consumption in the grid, auxiliary consumption, and losses in networks against electricity supply, taking into account power flows.

Benchmarking – a process to identify, understand, and adapt current good practices to improve organisation's performance. Analysis involves two processes: evaluation and comparison. Usually the best products and marketing process used by direct competitors and firms in other similar fields are taken as a baseline to see how the organisation can improve its products and practices.

RES – renewable energy sources where relatively constant or cyclical energy flows derived from natural sources are replenished at a rate that exceeds the rate of consumption. RES include solar (SES), wind power plants (WPP), small hydropower plants, and biogas plants.

The World Bank – an international financial institution established to provide financial and technical assistance to developing countries.

WPP – a wind farm with one or more wind turbines assembled in one or more locations and interconnected into a grid. Large wind farms can have 100+ wind turbines. WPPs are sometimes called wind parks.

GRES – a state district power plant/condensing power plant, a thermal power plant producing mainly electricity using local energy resources (peat, lignite, etc.) and supplying power primarily to a specific district.

HPP – a hydroelectric power plant that uses the movement of water in watercourses and tidal movements as a source of energy.

Monetary environment/monetary policy (MP) – a public policy, a set of measures aimed at managing aggregate demand through money market (short-term interest rate, nominal exchange rate or current liquidity level of the banking sector) to achieve a combination of ultimate objectives, which may include price stability, stable exchange rate, financial stability, and boosting balanced economic growth.

Subsidiaries and affiliates – subsidiaries and affiliates of Samruk-Energy Group of Companies.

EDB – the Eurasian Development Bank, an international financial institution which invests in the Eurasian region and promotes the strengthening and expansion of economic ties, as well as the comprehensive development of its member states: Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia, and Tajikistan. The authorised capital of the EDB is $7 billion. Projects with integration effects in transport infrastructure, digital systems, green energy, agriculture, industry and mechanical engineering account for the biggest share of the EDB's portfolio. The Bank operates in line with the UN Sustainable Development Goals and ESG principles.

EBRD – the European Bank for Reconstruction and Development, an investment vehicle set up to support market economies, private and entrepreneurial sector and democracy in 34 countries, from Central Europe to Central Asia.

UEPS of Kazakhstan – the Unified Electric Power System of Kazakhstan with power plants, transmission lines, and substations that provide reliable and quality power supply to consumers in Kazakhstan.

KASE – Kazakhstan Stock Exchange, a stock exchange headquartered in Almaty, which ranks second among CIS exchanges in terms of equity market capitalisation.

Quota-based installation – an installation with a greenhouse gas emission allowance exceeding 20,000 tonnes of carbon dioxide per year in regulated sectors of the economy.

AIFC – Astana International Financial Centre established on the initiative of the First President of the Republic of Kazakhstan, Yelbas Nursultan Nazarbayev. AIFC's mission is build a leading international financial services centre to promote and attract investment in the national economy, create an enabling environment for investment in financial services, develop the securities market in Kazakhstan and ensure its integration with international capital markets.

Heating period – autumn and winter heating season. The start and end dates of the heating period are set by the relevant regulations of the local governments.

Busbar output – a technical term describing the technological process of transmitting energy in series: from the energy generating (load serving) entity to the energy distributor and then to the end consumer.

Available capacity – the installed capacity of a generating unit (power plant) minus its capacity constraints.

ROI (return on investment) – a strategic efficiency/return on investment/performance indicator that demonstrates the effectiveness of an investment both when the budget is large and when the expenditure is small, meant to cover current needs.

Capacity market – a market where capacity is a special commodity. When purchasing it, a wholesale market player is entitled to demand from capacity sellers to keep generating equipment ready to generate electricity.

Net power flow – the algebraic sum of the flows over all interconnections of a given grid with other power systems.

Synchronous zone – a combination of all power systems operating in parallel that share a common frequency of electric current.

OHSMS – the occupational health and safety management system of the organisation, which ensures the safety and health of all employees and prevents occupational accidents and diseases at work.

SPP – a solar power plant that converts solar radiation into electrical energy. The ways in which solar energy is converted vary and depend on the design of the power plant.

Feasibility study – a paper that provides information on the feasibility/non-feasibility of a product or service, as well as a cost-benefit analysis of the project.

Installed capacity – the total nominal electrical power of the electric machines of the same type. The term is used to estimate the generated or consumed capacity of electricity systems, both of individual organisations and enterprises, and of industries and geographical regions as a whole. The nominal capacity can be either the rated active power expressed in watts, or the rated apparent power expressed in volt-amperes. In the energy sector, the installed capacity of an electrical installation is also referred to as the highest active electrical power at which the installation can operate continuously without overload, as specified in the technical specifications of the equipment.

IPCC – in-pit coal crushing and conveying where production is a single process flow in a mining company, with some processes carried out in cycles and others, in continuous modes.

The Shelek Corridor – a geographical area in the Enbekshikazakh District of Almaty Province near the border with China, considered to be an ideal place to install wind turbines as the wind always blows there. Experts call the area unique as the average annual wind speed at an altitude of 50 m is 7.8 metres per second and the flux density is 310 W/m².

Tasbulatov Rinat Yermekovich

Press Secretary

Phone: +7 (7172) 55-30-62

email: r.tasbulatov@samruk-energy.kz

Aisarieva Madina Bekaidarovna

Director of the Corporate Governance and Sustainable Development Department

Phone: +7 (7172) 55-30-20

email: m.aisarieva@samruk-energy.kz

Samruk-Energy Group of Companies Headquarters

010000, Astana

15A Kabanbay Batyr Avenue, “Q” Business Center, Block B

Phone: + 7 (7172) 55-30-00, + 7 (7172) 55-30-21

Fax: +7 (7172) 55-30-30

email: info@samruk-energy.kz

Auditor of Samruk-Energy JSC

PriceWaterhouseCoopers LLP

Almaty city, Republic of Kazakhstan, A25D5F6

34 Al-Farabi Avenue, Building «A,» 4th floor

Phone: +7 727 330 32 00

Registrar of Samruk-Energy JSC

Central Securities Depository Joint Stock Company

050040/A15P5B5, Almaty city, Republic of Kazakhstan

+7 (727) 262 08 46, 355 47 60

email: csd@kacd.kz, web@kacd.kz