(In thousands of Russian rubles)

	Notes	2018	2017 (Note 3Certain amounts shown here do not correspond to the financial statements for the year ended 31 December 2017 and reflect adjustments described in Note 3.)
Cash flows from operating activities
Profit before income tax		43,071,995	45,423,770
Adjustments for:
Depreciation	7	35,521,322	32,947,360
Amortization including land lease rights	24	996,116	768,342
Loss from disposal of property, plant and equipment		549,026	464,016
Loss from disposal of intangible assets		27,278	–
Loss from disposal of land lease rights	8	25,789	24,697
Gain from disposal of investment property		(1,180)	–
(Reversal) of expected credit losses / accrual of bad debt provision	24	(97,118)	129,225
Foreign exchange loss/(gain)		1,415,310	(133,680)
Finance costs	25	9,136,262	12,978,882
Investment income		(210,316)	(340,714)
Operating cash flows before working capital changes		90,434,484	92,261,898
Increase in trade and other receivables		(1,213,236)	(684,289)
(increase)/decrease in advances paid		(663,651)	217,829
Increase in advances received		511,328	375,292
Decrease/(increase) in taxes receivable		1,145,281	(150,461)
Decrease/(increase) in prepaid expenses		118,695	(181,674)
Increase in inventories		(23,424,016)	(27,260,045)
Increase in trade and other payables		10,247,625	15,353,763
Increase in accrued expenses		511,124	926,667
Decrease in taxes payable		(1,827,166)	(2,527,243)
Increase in contract liabilities		1,131,356	189,020
Increase in government grants	20	1,858,968	355,296
Cash generated from operations		78,830,792	78,876,053
Income tax paid		(4,433,235)	(4,876,235)
Interest paid		(9,860,959)	(13,334,900)
Interest received		200,720	343,376
Net cash from operating activities		64,737,318	61,008,294
Cash flows from investing activities
Purchase of property, plant and equipment		(51,603,538)	(73,528,262)
Purchase of intangible assets	9	(2,154,557)	(1,560,744)
Purchase of land lease rights	8	(847)	(63,023)
Cash received from business combination	6	187,758	–
Proceeds from sale of property, plant and equipment		1,079,628	459,417
Proceeds from sale of investment property		601,180	–
Loans provided		(1,507,414)	(1,855,287)
Loans repaid		166,756	1,552,549
Proceeds from government grants	20	22,742	800,695
Net cash used in investing activities		(53,208,292)	(74,194,655)
Cash flows from financing activities
Proceeds from loans and borrowings	30	600,693,859	688,243,578
Repayment of loans and borrowings	30	(572,272,534)	(689,033,285)
Dividends paid	30	(13,808,982)	(29,233,198)
Repayment of obligations under finance leases		(3,345)	(1,250)
Proceeds from additional issue of shares	14	–	44,988,662
Purchase of treasury shares	14	(17,727,687)	–
Net cash (used in) / generated from financing activities		(3,118,689)	14,964,507
Net increase in cash and cash equivalents		8,410,337	1,778,146
Cash and cash equivalents at the beginning of the year	13	18,337,417	16,559,271
Cash and cash equivalents at the end of the year	13	26,747,754	18,337,417

Chief Executive PJSC “Magnit” Naumova O.V.

14 March 2019

The accompanying notes on pages 12-67 are an integral part of these consolidated financial statements