Dear shareholders,

In recent years, our key strategic objective has been to transform a telecom operator into a digital ecosystem, into a multidisciplinary group operating in several high-tech areas. However, the telecommunications core is a stabilizing factor for us, since this market demonstrates the least drop in demand, which was already observed in crisis conditions. Such transformation means intensive expansion of the scope of activity and product offering, attraction of new personnel and reconfiguration of the management structure.

Such a significant business transformation in itself is a non-trivial task that requires a clear vision of the future, diligence and great effort in the implementation process. But in addition to this, during the previous three years, and especially in 2022, we had to act in extremely harsh environmental conditions — unprecedented in the entire history of the company. And this is not an element of luck, our inertia or a large margin of safety. This is a completely natural result of the mutual action of many components, among which I would highlight:

• a balanced strategy aimed at the consistent expansion of activities into new digital areas, based on a solid foundation of the telecommunications business;
• a strong, reliable, carefully selected management team ready to jointly withstand difficulties;
• a corporate culture that combines focus on action and overcoming challenges, mutual assistance and healthy pragmatism;
• a balanced HR policy, which allowed not only to retain employees, but also to engage new high-class professionals to work in promising digital areas.

In the current external uncertainty, we saw not only threats, but also opportunities, consisting in accelerating digitalization processes and growing demand for telecommunications and digital services. To unlock the opened potential, we need to work hard, make a high-quality product, and constantly improve it.

Based on this logic and taking into account the increased propensity of business owners to sell or to search for a large stable co-investor, during 2022 we actively invested in digital projects in a number of areas, such as travel, smart home, cybersecurity, advertising technologies, etc. For some areas of our activity, the year turned out to be really ineffective, but thanks to a balanced diversified business portfolio, the Group showed satisfactory results, taking into account the challenges of the external environment, and moreover, with limited investments, we did expand our product footprint and gained access to new technological solutions.

Among the most significant achievements of the company in 2022, I can name the following:

• MTS has certainly transformed into a multiprofile group that conducts business in several high-tech areas. The combination of a solid, sustainable core telecom business, along with new promising digital verticals, once again proved to be a solid foundation for the company’s long-term development.
• We have ensured the continuity of our activities, including the implementation of a capital investment program under known restrictions regarding access to high-tech equipment.
• We ensured the accrual of dividends at the rate of 33.85 rubles per share, which is higher than the levels of the previous 5 years, with the exception of 2021.
• We maintained our focus on further development, made tactical and strategic investments in new business areas.
• We maintained a comfortable level of debt with a 1.7 of the net debt to LTM OIBDA ratio.
• We have significantly increased our competencies and expanded technological solutions in the field of AI, Big Data, biometrics and are actively using them in B2B services.
• Complied with regulatory requirements and closed the ADR program on the New York Stock Exchange as correctly as possible.

Regarding the last point, I would like to emphasize in particular, that we do not perceive the delisting as a reason for a general decrease in the level of corporate governance. We continue to meet our usual high standards and the best international practices in this area. We understand that in the conditions of turbulence, it is more important than ever to ensure a sustainable and open business, to be transparent for partners, customers and other stakeholders, and to follow all the rules of business ethics impeccably.

Another confirmation of our commitment to adopt and develop the best world practices is our activity in the field of sustainable development and ESG. We perceive the improvement of the quality and safety of human life and society as one of the fundamental strategic objectives. Systematization and management of our projects and actions in this area at the level of operational management are handled by a dedicated ESG Center. Strategic control is performed by the Corporate Governance, Environmental and Social Responsibility Committee (ESG Committee) of MTS Board of Directors You will learn more about our activity in this area in the special sections of the report. In my address, I just want to emphasize that as a large stable company, as a supplier of advanced, massively demanded services, we are aware of our direct impact on people’s perception of their standard of living, on companies’ perception of confidence in current and future economic well-being. We understand our own responsibility in this regard, and in conditions of environmental pressure, uncertainty and stress, we strive to become a stabilizing factor for society, employees, partners and investors.

Circumstances may adjust our plans, but in our case we do not just believe, but quite clearly see that our strategic priorities are aligned correctly. We are confident in what we are doing, we think calmly and pragmatically, we actively respond to threats and use opportunities to ensure the interests of the company and investors.

Difficult times contribute to the formation of strong people: those who do not stop in front of obstacles and are able to win not thanks to, but in spite of. These are the people I see in our team, and I sincerely wish that there are more such people in the business and investment community, in the teams of our partners, in society as a whole. Whatever the circumstances are, we always have the opportunity to focus on action, creation and progress.

Chairman
of the Board of Directors of MTS