ROSTELECOM PJSC: Rostelecom launches new unified cyber security platform

ROSTELECOM LAUNCHES NEW UNIFIED CYBER SECURITY PLATFORM

Rostelecom to deploy innovative SD-Wan technology to develop the most secure and

one-of-a-kind cyber security offering in Russia

Moscow, Russia - November 14, 2018 - Rostelecom PJSC (MOEX: RTKM, RTKMP; OTCQX: ROSYY), the largest digital service provider in Russia, today announces that it has launched a new cyber security platform and its first three products. The platform will be functioning under Rostelecom-Solar, Russia's national provider of high-end technology services for targeted monitoring and information security. The new platform monitors the network security and provides cyber threat repealing through services, available directly on Rostelecom's communication channels. The platform was designed based on SD-WAN, one of the most innovative and fastest growing technologies in networking today and the only one of its kind in Russia.

Mikhail Oseevsky, President of Rostelecom, commented: "Our strategic objective is to become the digital partner to families, business and state.  In order to be at the forefront of today's networking evolution, we need a comprehensive ecosystem, comprising the whole range of best-in-class telecommunication and digital services. A cyber defence platform is the central element in such infrastructure and critical in ensuring its smooth and consistent operation. Information safety is a common goal shared by all stakeholders, and by providing growing confidence in security, we set ourselves an objective to establish a high level of penetration of information protection services throughout Russia. Our new platform will add great economic value and foster business efficiency within every organisation, thereby helping keep Russian companies ahead of the threats".

The starter kit includes Unified Threat Management, Secure Email Gateway and Web Application Firewall. Rostelecom plans to have more than twice as many services by the end of 2019.

Igor Lyapunov, Vice-president of Rostelecom for information security and Director General of Rostelecom Solar, commented: "The new platform opens a new chapter in the development of Russia's information security market. Six years ago we launched Solar JSOC, the first commercial center to monitor and respond to potential cyber-attacks, which has since become a leader in the Russian market. This time we are talking about a new segment with an impressively wider audience".

The new platform was designed to service a B2B audience. Unlike typical scenarios where a service provider manages hardware in data centers or customer sites, the unified cyber security platform deals with virtual infrastructure, which allows complete controllability, quick scalability and wider geographical network coverage.

The service model doesn't involve financial and resource costs on purchase, implementation and maintenance. This results in a quicker setup, better scalability,  which can't be achieved in a traditional setting. The consumption intensity is based on a pay-as-you-grow model - customised and tailored to users' needs and demands. Solar JSOC experts are responsible for connection, setup and maintenance on seven days a week around the clock, which brings the combined costs down over the period of 3 to 5 years, compared to using similar services locally.

The unified platform gathers information on cyber threats, from Solar's data center for monitoring and control, which in its turn aggregates data from commercial reports on malware, insecurity and threat Intelligence. It also participates in the information exchange with computer emergency response teams in Russia and abroad.

Alexey Sapunov, Senior Vice-President of Rostelecom for Technical Infrastructure, commented: "The unified platform is an integrated Telco Cloud system built to ensure a smooth operation with always-on reliability. It combines all the advantages of MANO framework and the breakthrough SD-WAN technology. Our corporate clients want to derive every benefit from the cloud-based IT services and network technologies. Hence, we have made it our priority to diversify the portfolio of intelligent services to help companies tackle challenges and improve business continuity by preventing any potential failures. The platform is transparent and equips our clients with a complex infrastructure to enable them build the best network security solutions into additional network connections services".

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PAO Rostelecom is the largest digital service provider, operating in all segments of the telecommunications market and covering millions of households in Russia.

Rostelecom is an undisputable leader of the broadband and pay-TV markets in Russia with over 13.0 million fixed-line broadband subscribers and over 10.1 million pay-TV subscribers, over 5.1 million of which are subscribed to Rostelecom's IPTV services on the national level.

In the nine months of 2018, the Group generated RUB 233.0 billion of revenues, RUB 74.9 billion of OIBDA (32.1% of revenue) and RUB 12.7 billion of net income.

The Group is a market leader in providing telecommunications services to government bodies and corporates of all levels.

Rostelecom is an important innovator that provides solutions in the field of E-Government, cloud computing, healthcare, education, security and housing & utility services.

The Group's stable financial position confirmed by its credit ratings. Rostelecom was assigned 'BBB-' and 'BB+' international credit ratings by Fitch Ratings and Standard&Poor's respectively, and AA(RU) by ACRA.

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Rostelecom Solar is Russia's national provider of high-end technology services for targeted monitoring and information security. Rostelecom Solar's approach to Cyber Security is based on the understanding that the security of IT and IS technologies is only possible through the building of a unified cyber security monitoring and management framework. Solar Security is focusing on this key principle in its development of its products and services.

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Certain statements in this press release are forward-looking statements within the meaning of the U.S. federal securities laws and intended to be covered by the safe harbours created thereby.

Those forward-looking statements include, but are not limited to:

• Assessment of PAO Rostelecom's (the Company) future operating and financial results as well as forecasts of the present value of future cash flows and related factors;
• The Company's plans to take ownership stakes in other organisations;
• the Company's anticipated capital expenditures and plans to construct and modernize its network;
• the Company's expectations as to the growth in demand for its services, plans relating to the expansion of the range of its services and their pricing;
• the Company's plans with respect to improving its corporate governance practices;
• the Company's expectations as to its position in the telecommunications market and forecasts on the development of the market segments within which the Company operates;
• economic outlook and industry trends;
• the Company's expectations as to the regulation of the Russian telecommunications industry and assessment of impact of regulatory initiatives on the Company's activity;
• other statements regarding matters that are not historical facts.

Such forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from those expressed or implied by these forward-looking statements. These risks, uncertainties and other factors include:

• risks relating to changes in political, economic and social conditions in Russia as well as changes in global economic conditions;
• risks relating to Russian legislation, regulation and taxation, including laws, regulations, decrees and decisions governing the Russian telecommunications industry, securities industry as well as currency and exchange controls relating to Russian entities and their official interpretation by regulatory bodies;
• risks relating to the Company, including the achievement of the anticipated results, levels of profitability and growth, ability to create and meet demand for the Company's services including their promotions, and the ability of the Company to remain competitive in a liberalized telecommunications market;
• technological risks associated with the functioning and development of the telecommunications infrastructure, technological innovations as well as the convergence of technologies;
• other risks and uncertainties. For a more detailed discussion of these and other factors, see the Company's Annual Report and the Company's other public filings.

Many of these factors are beyond the Company's ability to control or predict. Given these and other uncertainties, readers are cautioned not to place undue reliance on any of the forward-looking statements contained herein or otherwise. The Company does not undertake any obligation to release publicly any revisions to these forward-looking statements (which are made as of the date hereof) to reflect events or circumstances upon the annual report publication or to reflect the occurrence of unanticipated events, except as may be required under applicable laws.