Companhia Siderurgica Nacional Q1 FY2024 earnings call

• Mining had record sales in the first quarter with over 9 million tonnes sold. - Steel had consecutive quarters of sales, normalizing operations and compensating domestic weakness with foreign sales, achieving 26% EBITDA margin. - ESG highlight with publication of 2023 integrated report on emissions control. - CapEx dropped 50% quarter-on-quarter due to seasonality, but made advances in steel, coke batteries, mining P15 equipment. - Working capital reduced due to weaker sales, especially in mining. - Debt amortization schedule showed sound cash position, active in rolling debt with focus on long-term and local market, reissued bonds and concluded debentures.

Steel Performance: For the fifth consecutive quarter, steel sales showed normalization. It compensated for a seasonally weaker domestic market with increased sales abroad, achieving a 26% EBITDA margin. Steel production grew 5.7% compared to the same period in 2023, but was offset by a drop in price. ### Mining Performance: The company maintained operational excellence, achieving a record production for the first quarter with over 9 million tonnes sold. However, the intense readjustment in iron ore price led to a drop in EBITDA, with a margin of 40% this quarter. ### Cement Performance: Despite seasonality and increased rainfall, the company maintained assertive commercial activity. It saw an enhancement in the competitive environment allowing price adjustment, with revenue stable despite lower volume. The adjusted EBITDA margin surpassed 25% for the first time since asset integration.

• Future quarters expected to have more robust results with seasonality and price increase. - Mining price recovery expected to eliminate first quarter negative impact, returning to budgeted results. - Steel expects better results in second quarter with improvement in domestic market. - Cement continues to grow in amount and margin, with potential for price adjustment and synergy capture. - Investments to continue at normal pace, with P15 equipment fully contracted and expected to become operational briefly. - Commitment to remain below 3 times leverage, working towards 2.5-3 times leverage.

• Commodity price fluctuations impacting results. - Exchange rate and interest rate levels affecting financials. - Protectionist measures in U.S., Brazil, etc., affecting exports and imports. - Changes in laws and regulations. - Intense competition from China imports affecting steel and other segments.

Q: Daniel Sasson asked about China competition and the government's new scheme for steel imports.

A: Luis Martinez commented on the serious impact of Chinese imports on Brazilian steel market, mentioned postponed antidumping cases, and explained the government's measures were not sufficient to combat unfair competition.

Q: Rafael Barcellos asked Marco Rabello about his initial perception and focus areas, and about steel market dynamics.

A: Marco Rabello mentioned CSN's potential for growth via organic or acquisitions, focusing on funding for CapEx in mining and steel. Luis Martinez spoke about steel market international and domestic dynamics, price expectations, and challenges.

Q: Ricardo Monegaglia asked about cement industry consolidation and steel mill margin recovery.

A: Edvaldo Rabelo and Luis Martinez discussed cement's value harnessing through operational excellence, price-volume ratio, and market share. Luis Martinez also spoke about steel margin recovery through cost reduction and price adjustment in the second half.

Q: Marcio Farid asked about U.S. investment appetite and CapEx execution.

A: Luis Martinez and Benjamin Steinbruch talked about U.S. investment opportunities with favorable funding lines, and CapEx trends with seasonality and P15 investment progress.