SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 

 
FORM 6-K
 
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934
 
For the month of December, 2023
Commission File Number 1-14732
 

 
COMPANHIA SIDERÚRGICA NACIONAL
(Exact name of registrant as specified in its charter)
 
National Steel Company
(Translation of Registrant's name into English)
 
Av. Brigadeiro Faria Lima 3400, 20º andar
São Paulo, SP, Brazil
04538-132
(Address of principal executive office)
 

Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F. 
Form 20-F ___X___ Form 40-F _______

 Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.  

Yes _______ No ___X____

 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 

 

Table of Contents

 

Company Information  
Capital Breakdown 1
Parent Company Financial Statements  
Balance Sheet – Assets 2
Balance Sheet – Liabilities 3
Statement of Income 4
Statement of Comprehensive Income 5
Statement of Cash Flows 6
Statement of Changes in Shareholders’ Equity  
01/01/2023 to 09/30/2023 7
01/01/2022 to 09/30/2022 8
Statement of Value Added 9
Consolidated Financial Statements  
Balance Sheet – Assets 10
Balance Sheet - Liabilities 11
Statement of Income 12
Statement of Comprehensive Income 13
Statement of Cash Flows 14
Statement of Changes in Shareholders’ Equity  
01/01/2023 to 09/30/2023 15
01/01/2022 to 09/30/2022 16
Statement of Value Added 17
Comments on the Company’s Consolidated Performance 18
Notes to the financial information 39
Comments on the Performance of Business Projections 86
Reports and Statements  
Unqualified Independent Auditors’ Review Report 90
Officers Statement on the Financial Statements 91
Officers Statement on Auditor’s Report 92

 

 

 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

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Company Information / Capital Breakdown

 

Number of Shares

(Units)

Current Period

9/30/2023

 
Paid-in Capital    
Common 1,326,093,947  
Preferred 0  
Total 1,326,093,947  
Treasury Shares    
Common 0  
Preferred 0  
Total 0  

 

 

 

 

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Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

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Parent Company Financial Statements / Balance Sheet - Assets  
(R$ thousand)    
     

 

 

 

 

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Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

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Parent Company Financial Statements / Balance Sheet – Liabilities
(R$ thousand)      

 

 

 

 

 

3 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 

 

Parent Company Financial Statements / Statement of Income
(R$ thousand)  

 

4 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 

 

 

Parent Company Financial Statements / Statement of Comprehensive Income
(R$ thousand)

 

 

5 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 

 

Parent Company Financial Statements / Statements of Cash Flows – Indirect Method
(R$ thousand)

 

6 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

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Parent Company Financial Statements / Statement of Changes in Equity - 01/01/2023 to 09/30/2023
(R$ thousand)          

 

 

 

 

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Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

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Parent Company Financial Statements / Statement of Changes in Equity - 01/01/2022 to 09/30/2022
(R$ thousand)        

 

 

8 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

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Parent Company Financial Statements / Statement of Value Added
(R$ thousand)

 

9 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

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Consolidated Financial Statements / Balance Sheet - Assets
(R$ thousand)  

 

 

 

 

 

10 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

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Consolidated Financial Statements / Balance Sheet – Liabilities
(R$ thousand)  
   

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Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

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Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

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Consolidated Financial Statements / Statement of Comprehensive Income
(R$ thousand)

 

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Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

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Consolidated Financial Statements / Statements of Cash Flows – Indirect Method

(R$ thousand)

   

 

 

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Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

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Consolidated Financial Statements / Statements of Changes in Equity - 01/01/2023 to 09/30/2023
(R$ thousand)          

 

 

 

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Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

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Consolidated Financial Statements / Statements of Changes in Equity - 01/01/2022 to 09/30/2022
(R$ thousand)        

 

 

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Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

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Consolidated Financial Statements / Statements of Value Added
(R$ thousand)

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Consolidated Table - Highlights

 

¹ Adjusted EBITDA is calculated from net income (loss), plus depreciation and amortization, taxes on profit, net financial result, investment participation result, other operating income/expenses result and includes the proportional share of 37.27% of the EBITDA of the joint subsidiary MRS Logística.

² Adjusted EBITDA Margin is calculated from Adjusted EBITDA divided by Management Net Revenue.

³ Adjusted Net Debt and Adjusted Cash/Availability consider 37.27% of MRS, in addition to not considering Forfaiting and Drawn Risk operations.

 

Consolidated Results

 

·Net Revenue totaled R$ 11,125 million in 3Q23, which represents an increase of 1.2% when compared to 2Q23, mainly as a result of the strong performance in the mining segment, which combined a new sales record with an increase in realized price. In addition, the logistics and cement segments also contributed positively to the higher revenues recorded in the period.

 

·Cost of Goods Sold (COGS) totaled R$ 8,320 million in 3Q23, down 4.9% from the previous quarter, reflecting the normalization of production in the steel industry.

 

·In 3Q23, CSN recorded Gross Profit of R$ 2,805 million, with a Gross Margin of 25.2% or 4.8 p.p. higher than in the previous quarter. This growth in profitability reflects the strong operational performance seen in the period, in addition to the positive effect of the increase in the exchange rate on sales to the foreign market.

 

·Selling, General and Administrative Expenses totaled R$ 1,175 million in 3Q23, 8.6% higher than in 2Q23, as a result of the higher volume sold in mining, resulting in higher freight expenses.

 

·The group of Other Revenues and Operating Expenses was negative by R$ 113 million in 3Q23, which represents a reduction of 11.5% compared to 2Q23, explained by the positive effect of iron ore hedging operations, which generated a gain of R$ 31 million in the period.

 

·In 3Q23, the Financial Result was negative by R$ 1,223 million, in line with the previous quarter, as a consequence of the maintenance of the cost of debt and a lesser impact of Usiminas' shares.

 

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·Equity Result was positive by R$ 131 million in 3Q23, an increase of 22.4% compared to the previous quarter, as a result of the strong performance achieved by MRS.

 

 

·CSN recorded Net Income of R$ 91 million in 3Q23, which represents a reduction of 67.8% compared to the previous quarter, as 2Q23 was positively impacted by a reversal of the provision with IR/CSLL. This situation ended up offsetting the operational improvement seen in this quarter.

 

Adjusted EBITDA

 

*The Company discloses its Adjusted EBITDA excluding participation in investments and other operating income (expenses) because it understands that they should not be considered in the calculation of recurring operating cash generation.

 

·In 3Q23, Adjusted EBITDA was R$ 2,815 million, with an Adjusted EBITDA Margin of 24.3% or 4.7 p.p. above that seen in the last quarter. This increase in profitability is a direct consequence of the improvement in prices in the mining segment, which, combined with a higher sales volume, ended up offsetting the more challenging situation in the steel segment. Additionally, the stronger performance achieved in the logistics segment and the positive dynamics seen in the cement segment, with price increases and capture of synergies, also contributed favorably to the EBITDA improvement.
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Adjusted EBITDA (R$ MM) and Adjusted EBITDA Margin¹ (%)

 

¹ The Adjusted EBITDA Margin is calculated from the division between Adjusted EBITDA and Adjusted Net Revenue, which considers the interests of 100% in the consolidation of CSN Mineração and 37.27% in MRS.

 

Adjusted Cash Flow

 

Adjusted Cash Flow in 3Q23 was positive by R$ 1,022 million, as a result of the combination of strong operating performance and efficient working capital management, yet with another reduction in inventory observed during the period.

 

Adjusted cash flow¹ in 3Q23 (R$ MM)

 

¹ The concept of Adjusted cash flow is calculated from Adjusted EBITDA, subtracting Ebitda from Joint Subsidiaries, CAPEX, IR, Financial Result and changes in Assets and Liabilities², excluding the effect of the Glencore advance.

² The Adjusted Working Capital is composed of the variation of the Net Working Capital, plus the variation of accounts of long-term assets and liabilities and disregarding the net variation of IR and CS.

 

Indebtedness

 

On 09/30/2023, consolidated net debt reached R$ 29,939 million, with the leverage indicator measured by the LTM Net Debt/EBITDA ratio reaching 2.63x, which represents a reduction of 150 basis points compared to the previous quarter. With the peak leverage of the year behind us, the Company remains firm in its path of reducing its debt ratio and is on track to deliver an increasingly solid capital structure, even more so when considering the normalization of the steel operation and the growth potential of the cement segment, after synergy captures are complete. In addition, CSN maintained its policy of carrying a high cash position, which reached R$ 16 billion in this quarter.

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Indebtedness (R$ Billion) and

Net Debt / Adjusted EBITDA (x)

 

Net Debt Build-Up

(R$ Billions)

     

 

¹ Net Debt / EBITDA: For debt calculation considers the final dollar of each period and for net debt and EBITDA the average dollar of the period.

 

The Company remains very active in its objective of extending the amortization period, focusing on long-term operations and the local capital market. Among the main transactions in 3Q23, CSN's 14th issuance of simple debentures stands out, in the total amount of R$ 700 million, with the objective of investing in railway infrastructure, in the logistics and transportation segment.

 

Amortization Schedule (R$ Bi)

¹ IFRS: does not consider participation in MRS (37.27%).

² Management Gross / Net Debt considers participation in MRS (37.27%), without accrued interest.

3 Average Term after completion of the Liability Management Plan.

 

Foreign Exchange Exposure

 

The accumulated net foreign exchange exposure in the consolidated balance sheet up to 3Q23 was US$ 456 million, as shown in the table below, in line with the company's policy of minimizing the impacts of exchange rate volatility on the result. The Hedge Accounting adopted by CSN correlates the projected flow of dollar exports in dollars with the future maturities of the debt in the same currency. As a result, the exchange variation of the dollar debt is temporarily recorded in the shareholders' equity and is taken to the result when the dollar revenues from such exports occur.

 

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Investments

 

A total of R$ 1,191 million were invested in 3Q23, 20.2% higher than the amount invested in 2Q23, with emphasis on repairs to coke batteries at UPV and general repairs to steel operations. In the mining segment, we highlight the current investments to maintain operational capacity and progress in expansion projects (mainly related to P15, recovery of tailings from dams and expansion of the Itaguaí port), accompanied by current investments in cement operations.

 

 

Net Working Capital

 

Net Working Capital applied to the business totaled R$ 1,922 million in 3Q23, a reduction of 36.1% compared to 2Q23, due to (i) the Company's lower inventory volume, in line with the increase in sales recorded in the period, and (ii) an increase in the number of CSN suppliers.

 

The calculation of the Net Working Capital applied to the business disregards the advance on the sales of ore, as shown in the following table:

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¹ Other CCL Assets: Considers employee advances and other accounts receivable.

² Other CCL Liabilities: Considers other accounts payable, dividends payable, installment taxes and other provisions.

³ Inventories: Does not consider the effect of the provision for inventory/inventory losses. For the calculation of the SME, the balances of warehouse stocks are not considered.

 

 

 

 

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Results by Business Segments

Net Revenue by Segment – 3Q23 (R$ million-before eliminations)

 

 

 

 

Adjusted EBITDA by Segment – 3Q23 (R$ million - before eliminations)

 

 

 

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3Q23 Results (R$ million) Steel Mining Logistics (Port) Logistics (Rail) Energy Cement

Corporate Expenses/

Eliminations

Consolidated
                 
Net Revenue 5,344 4,335 75 730 122 1,159 (640) 11,125
Internal Market 4,130 567 75 730 122 1,159 (1,170) 5,613
Foreign Market 1,214 3,768 - - - - 530 5,512
COGS (5,209) (2,567) (65) (367) (106) (915) 909 (8,320)
Gross profit 135 1,768 10 363 16 244 270 2,805
DGA/DVE (299) (71) (3) (57) (16) (145) (588) (1,175)
Depreciation 346 269 12 100 25 167 (77) 842
Proportional EBITDA of jointly controlled Companies - - - -   - 343 343
Adjusted EBITDA 183 1,966 19 406 25 266 (50) 2,815
                 
2Q23 Results (R$ million) Steel Mining Logistics (Port) Logistics (Rail) Energy Cement

Corporate Expenses/

Eliminations

Consolidated
                 
Net Revenue  5,943  3,631  54  668  159  1,142  (609)  10,989
Internal Market  4,368  372  54  668  159  1,142  (1,012)  5,752
Foreign Market  1,574  3,260  -     -     -     -     403  5,237
COGS  (5,419)  (2,626)  (61)  (352)  (100)  (952)  765  (8,746)
Gross profit  523  1,006  (7)  316  59  191  156  2,243
DGA/DVE  (288)  (147)  (3)  (51)  (15)  (123)  (455)  (1,082)
Depreciation  318  254  13  98  24  156  (75)  788
Proportional EBITDA of jointly controlled Companies  -           -     -     -     -     313  313
Adjusted EBITDA  553  1,112  3  362  69  224  (60)  2,263
                 
3Q22 Results (R$ million) Steel Mining Logistics (Port) Logistics (Rail) Energy Cement

Corporate Expenses/

Eliminations

Consolidated
                 
Net Revenue 7,698 2,527 69 653 48 778 (875) 10,897
Internal Market 5,655 438 69 653 48 778 (1,091) 6,549
Foreign Market 2,044 2,089 - - - - 215 4,348
COGS (6,426) (1,800) (54) (397) (53) (501) 873 (8,359)
Gross profit 1,272 727 14 256 (5) 276 (3) 2,538
DGA/DVE (334) (63) (7) (37) (10) (100) (248) (798)
Depreciation 313 253 9 108 4 82 (78) 689
Proportional EBITDA of jointly controlled Companies - - - - - - 285 285
Adjusted EBITDA 1,251 916 16 327 (10) 257 (44) 2,713

 

Results of the Steel Industry

 

According to the World Steel Association (WSA), global crude steel production totaled 460.4 million tons (Mt) in the third quarter of 2023, which represents a decrease of 4.5% compared to the previous quarter as a consequence of the seasonality of the period, but an increase of 1.9% compared to the same period in 2022, reflecting the higher level of activity in the Chinese market. The European Union reduced its production by 9.9% compared to the previous quarter and 6.5% compared to the same period last year, impacted by the environment of high interest rates, inflation and still high energy costs. In turn, China produced 56.3% of the global volume (259.3 Mt) in 3Q23, which corresponds to a quarterly reduction of 5.3 p.p., but an increase of 2.8 p.p. compared to the same period of the previous year. The expectations for 2023 remain positive as Chinese government incentives indicate a prospect of a 1.8% increase in global steel production, after a 3.3% contraction in 2022. Brazil, on the other hand, produced 8.0 Mt in 3Q23, which corresponds to a decrease of 2.4% in relation to the previous quarter and 3.6% when compared to the same period of the previous year, mainly impacted by the increase in imports. The outlook for local market activity in 2023 is less encouraging, even after the normalization of production by relevant players, but with intense competition with imported material and with demand still responding slowly to the cycle of cuts in the Selic rate and government stimulus through programs such as PAC, Minha Casa, Minha Vida, Plano Safra and etc.

 

 

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Steel Production (thousand tons)

 

In the case of CSN, Slab Production in 3Q23 totaled 922 thousand tons, a performance 25.9% higher than in the previous quarter, which reflects the normalization of the operation after a series of bottlenecks faced in the first semester. In turn, the production of flat rolled products, our main market, reached 835 Kton, which represents an increase of 7.8% compared to 2Q23, reflecting the resumption of the production process and bringing the volume produced to numbers closer to previous periods.

 

Sales Volume (Kton) – Steel

 

 

Total sales reached 1,018 thousand tons in the third quarter of 2023, a volume 3.1% lower than in 2Q23. When analyzing the behavior in different markets, it can be seen that the domestic market showed growth even with all the pressure faced with imported products, with emphasis on the hot rolled products performance. Domestic sales totaled 747 thousand tons of steel products in 3Q23, which represents an increase of 1.1% compared to 2Q23 and reinforces the normalization of the operation and the Company's resilience in managing to maintain an assertive commercial strategy even with all the pressure seen in the period. In the foreign market, sales totaled 271 thousand tons in 3Q23 and were 13.0% lower than in 2Q23, as a result of seasonality and weaker dynamics in the European market. During the quarter, 5,000 tons were exported directly, and 267,000 tons were sold by subsidiaries abroad, of which, 67,000 tons were sold by LLC, 132,000 tons by SWT and 68,000 tons by Lusosider.

 

Regarding total Sales Volume in 3Q23, the main highlight was the flat steel segment for construction, with a 24.1% increase compared to the previous quarter. On the other hand, Automotive (-11.9%) and Home Appliances (-4.2%) appear among the main negative highlights after a stronger start to the year. In the year-on-year comparison, there was a significant recovery in Home Appliances and flat steel for construction, but with decreases in the other segments.

 

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According to ANFAVEA (National Association of Automotive Vehicle Manufacturers), production in 3Q23 registered 619 thousand units, an increase of 3.8% over the previous quarter. According to the Association, the volume of vehicle registrations increased by 19.8% in the third quarter.

 

When looking at data from the Brazil Steel Institute (IABr), Crude Steel production in 3Q23 reached 7.96 Mton, a performance 6.6% lower than in the same period of 2022 and 1.6% below 2Q23. Apparent Consumption was 6.34 Mton, an increase of 2.8% year-on-year and 7.9% compared to 2Q23. In turn, the Steel Industry Confidence Indicator (ICIA) for September was 37.7 points, which represents a reduction of 4.9 p.p. compared to December 2022, a performance that reflects all the dissatisfaction and insecurity with the greater entry of imported products into the Brazilian market.

 

According to IBGE data, the production of home appliances for the month of September 2023 registered an increase of 6.8% compared to the previous year, reinforcing the continuous improvement of the home appliances segment after the weak performance observed last year.

 

Sales by Market Segment

 

 

  

·Net Revenue in the Steel Industry reached R$ 5,344 million in 3Q23, a performance 10.1% lower than in 2Q23, as a result of the adjustment in prices in the domestic market and the lower dynamism in the foreign market. In this sense, the Average Price in 3Q23 in the domestic market was 6.7% lower than in 2Q23, which shows the pressure exerted by imported material. On the other hand, the price in the foreign market was even lower, with a drop of 11.5% compared to the previous quarter, impacted both by lower commercial activity and by a greater penetration of external material at more competitive prices.

 

·In turn, the Slab Cost in 3Q23 reached R$ 3,563/t, a reduction of 13.4% compared to the previous quarter, as a direct consequence of the normalization of production, helping to dilute fixed costs, in addition to the lower volume of plates purchased.

 

 

Slab Cost with deprec. (R$/t)

 

3Q23 Production Cost

     

·The steel industry's Adjusted EBITDA reached R$ 183 million in 3Q23 and was 67.0% lower than in 2Q23, with an Adjusted EBITDA Margin of 3.4% (-5.9 p.p.). This result reflects the combination of a weaker foreign market and a domestic performance marked by operational normalization and price adjustments in order to make the local product more competitive. On the other hand, it is worth highlighting the transient effect of this lower profitability, as all necessary adjustments have already been made, while a gradual recovery of the Brazilian market is becoming evident.
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Adjusted EBITDA and Steel Margin (R$ MM and %)

 

Mining Result

 

In the mining sector, the quarter was marked by high demand for iron ore in China and an improvement in price levels, with the appreciation of Platts that closed 3Q23 US$ 3.06 above the average observed in the previous quarter. Steel production in China remains at high levels, leading to increases in capacity utilization at Chinese steel mills and low levels of ore inventories at both Chinese mills and ports. This situation ended up weighing favorably on the price of ore and has been driven by the Chinese government's stimulus packages, in an attempt to inject liquidity into the economy and ensure low financing costs for the consumer, manufacturing, infrastructure and real estate segments. Such moves have boosted demand for iron ore, including for lower-quality products as margins at Chinese steel mills remain quite tight. In this scenario, the iron ore price closed 3Q23 with an average of US$ 114.04/dmt (Platts, Fe62%, N. China), 2.8% higher than in 2Q23 (US$ 110.98/dmt) and 10.4% higher than in 3Q22 (US$ 103.31 /dmt). 

 

Regarding Sea Freight, the BCI-C3 Route (Tubarão-Qingdao) presented an average of US$ 20.3/wmt in 3Q23, which represents a reduction of 3.6% compared to the freight cost of the previous quarter, as a reflection of the increase in spot supply in the Atlantic Ocean. In addition, the rainy season in Africa and the large amount of cargo negotiated within contracts supported this scenario, helping to offset the increase in fuel prices in the period.

 

Total Production – Mining

(Thousand tons)

 

Sales Volume – Mining

(Thousand tons)

     

 

 

·Iron Ore Production added yet another record volume of 11,589 thousand tons in 3Q23, which represents an increase of 3.9% compared to the volume recorded in 2Q23 and an increase of 20.4% compared to the same period last year. This is the second consecutive production record achieved by the Company and confirms the excellent operational momentum seen this year, even more so when it is observed that there was a significant improvement in the mix of own production and consequent reduction in the volume of purchases from third parties when compared to the previous period. Additionally, the performance achieved in 9M23 places CSN in a comfortable position to revise its production and purchase guidance to 42.0 - 42.5 Mton stipulated for 2023.
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·Sales Volume, in turn, also reached a record result of 11,641 thousand tons in 3Q23, surpassing by 3.4% the record set in the previous quarter and 28.0% above the same period of the previous year. The company was able to take advantage of the favorable scenario with strong Chinese demand and the dryer period to deliver a quarterly sales record.

 

·In 3Q23, Adjusted Net Revenue totaled R$ 4,335 million and was 19.4% higher than in 2Q23, a performance that reflects not only the higher volume of shipments, but also the higher price realization seen in the period. As a result, Net Unitary Revenue was US$ 75.23 per wet ton, which represents an increase of 14.5% compared to 2Q23, following the upward trajectory of the price of Platts and open cargoes that offset the 5.1% appreciation of the exchange rate.

 

·In turn, the Cost of Goods Sold from mining totaled R$ 2,567 million in 3Q23, a reduction of 2.2% compared to the previous quarter, even with higher commercial activity, which is justified by the lower volume of third-party purchases and lower use of third-party ports. On the other hand, the C1 cost reached US$ 21.3/t in 3Q23, 1.4% lower than in the previous quarter, reflecting the higher dilution of fixed costs and lower SG&A unit costs that ended up offsetting the increase in diesel in the period.

 

·Adjusted EBITDA reached R$ 1,966 million in 3Q23, with a significant quarterly Adjusted EBITDA Margin, reaching 45.4% or 14.7 p.p. higher than in the previous quarter. This increase in profitability is the result of a very favorable situation that combined record sales volume with better ore prices.

 

 

Cement Result

 

According to the National Union of the Cement Industry (SNIC), cement sales in Brazil from January to September 2023 had a slight decrease of 2.0% when compared to the same period of the previous year. This scenario reflects a normalization of the market after the boom experienced during the pandemic, plus the effects of a still high interest rate, the maturation of the new public policies of a government in its first year in office and a volume of rainfall above the historical average, especially in some regions such as the South of the country. On the other hand, even considering all these effects, the market remains quite resilient and already shows some signs of recovery. For example, cement sales in Brazil grew 8.3% in 3Q23 compared to the previous quarter and the consumer confidence index reached the highest level since 2014. In addition, job recovery scenario and GDP, in addition to the cooling of inflation and the beginning of the downward trajectory of interest rates are other indications that should boost sales in the coming months. Finally, the announcement of the new modality of the Growth Acceleration Program (PAC) and the reformulation of Minha Casa, Minha Vida are new evidence that should provide even more support for a new growth cycle in the sector.

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In terms of commercial performance, CSN's sales in 3Q23 totaled 3,263 Kton, which represents a small decrease of 2.1% compared to the previous quarter, but 4% above the same period of the previous year.

Sales Volume - Cement (thousand tons)

* LafargeHolcim's operations were integrated in September 2022.

 

·Net Revenue, in turn, reached R$ 1,159 million in 3Q23 and was 1.5% higher than in the previous quarter, reinforcing the more assertive commercial strategy and the better price level practiced in the period, especially for the structured cement and bulk market. This eventually compensated for the lower sales volume in the period.

 

·In 3Q23, cement Unitary Cost fell 1.8% compared to the previous quarter, as a result of lower costs with raw materials.

 

·In turn, the segment’s Adjusted EBITDA increased by 19.1% compared to the previous quarter, reaching R$ 266 million in 3Q23 and with an Adjusted EBITDA Margin of 23.0%, or 3.4 p.p. higher than in 2Q23, reinforcing all the synergy capture achieved in the period. In addition, the environment remains favorable for margin expansion as there is room for further recovery in prices and sales in the coming months.

 

Energy Result

 

In 3Q23, energy prices remained at a level still below the average of recent years, due to the high level of water that has been recorded in the reservoirs. As a result, the volume of energy traded in the quarter generated Net Revenue of R$ 122 million, which represents a reduction of 23.5% compared to the previous quarter. Adjusted EBITDA also decreased in the period, reaching R$ 25 million and generating an Adjusted EBITDA Margin of 20.3%, which represents a reduction of 23.1 p.p. compared to the previous quarter, when the recognition of tax credits favored profitability.

 

Logistics Result

 

Railway Logistics: In 3Q23, Net Revenue reached RR$ 730 million, with an Adjusted EBITDA of R$ 406 million and Adjusted EBITDA Margin of 55.7%. Compared to 2Q23, revenue increased 9.2% due to the seasonality of the period and a higher volume of goods transported. In the same line of comparison, Adjusted EBITDA was 12.2% higher.

 

Port Logistics: In 3Q23, 292 thousand tons of steel products were shipped by Sepetiba Tecon, in addition to 14 thousand containers, 4 thousand tons of general cargo and 239 thousand tons of bulk. Compared to the previous quarter, the Company

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significantly increased its shipments, with the increase in the volume of steel products and in the volume of bulk. As a result, Net Revenue from the port segment was 37.3% higher than in the previous quarter, reaching R$ 75 million in 3Q23, with a positive impact on Adjusted EBITDA for the period, which was R$ 19 million in the quarter and Adjusted EBITDA Margin of 25.2%, or 20.2 p.p. higher than in 2Q23.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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ESG – Environmental, Social & Governance

 

ESG PERFORMANCE – CSN GROUP

Since the beginning of 2023, CSN has adopted a new format for disclosing its ESG actions and performance, providing its performance in ESG indicators on an individual basis. The new model allows stakeholders to have access to the main results and indicators on a quarterly basis and to monitor them effectively and even more quickly. Access can be made through the results center on CSN's IR website: https://ri.csn.com.br/informacoes-financeiras/central-de-resultados/

The information included in this release was selected based on relevance and materiality to the company. Quantitative indicators are presented compared to the period that best represents the metric for monitoring them. Thus, some are compared to the same quarter of the previous year, and others will be compared to the average of the previous period, ensuring a comparison based on seasonality and periodicity. Additionally, it is important to highlight that the ESG Performance Report also incorporates the performance indicators of the new assets of CSN Cimentos, acquired in 2022, so that some absolute indicators will change significantly when compared to the previous period.

More detailed historical data on CSN's performance and initiatives can be found in the 2022 Integrated Report, released in April 2023 (https://esg.csn.com.br/nossa-empresa/relatorio-integrado-gri ). ESG indicator assurance occurs annually for the Integrated Report's closing, so the information contained in quarterly releases is subject to adjustments resulting from this process.

It is also possible to track CSN's ESG performance in an agile and transparent manner on our website through the following electronic address: https://esg.csn.com.br .

 

 

 

 

 

 

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Capital Markets

 

In the third quarter of 2023, CSN's shares were practically stable (+0.1%), while the Ibovespa index fell 1.3%. The average daily volume (CSNA3) traded on B3, in turn, was R$ 100.8 million in 3Q23. On the New York Stock Exchange (NYSE), the Company's American Depositary Receipts (ADRs) depreciated 7.7% in dollar terms, while the Dow Jones index decreased 2.6%. The average daily trading of ADRs (SIDs) on the NYSE in 3Q23 was US$ 5.9 million.

 

                          3Q23
No. of shares in thousands   1,326,094
Market Cap    
Closing Quote (R$/share)   12.14
Closing Quote (US$/ADR)   2.39
Market Value (R$ million)   16,099
Market Value (US$ million)   3,169
Change in the period    
CSNA3 (R$)   -0.08%
SID (US$)   -7.72%
Ibovespa (R$)   -1.29%
Dow Jones (US$)   -2.62%
Volume    
Daily average (thousand shares)   8,013
Daily average (R$ thousands)   100,786
Daily average (thousand ADRs)   2,316
Daily Average (US$ thousand)   5,995

Source: Bloomberg

 

   
       

 

Earnings Conference Call:

 

3Q23 Earnings Presentation Webcast Investor Relations Team

Conference Call in Portuguese with Simultaneous Translation into English November 14, 2023

11:30 a.m. (Brasilia time)

09:30 a.m. (New York time)

+55 11 3181-8565 / +55 11 4090-1621

Code: CSN

Replay Phone: +55 11 4118-5151

Replay Code: 219011#

Webcast: click here            

Marcelo Cunha Ribeiro – CFO and Executive Director of IR

Pedro Gomes de Souza (pedro.gs@csn.com.br)

Rafael Costa Byrro (rafael.byrro@csn.com.br)

Ricardo Reis (ricardo.reis.rr2@csn.com.br)

 

 

 

 

Some of the statements contained herein are forward-looking statements that express or imply expected results, performance or events. These perspectives include future results that may be influenced by historical results and the statements made in 'Outlook'. Current results, performance and events may differ materially from assumptions and prospects and involve risks such as: general and economic conditions in Brazil and other countries; interest and exchange rate levels, protectionist measures in the U.S., Brazil, and other countries, changes in laws and regulations, and general competitive factors (on a global, regional, or national basis).

 

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INCOME STATEMENT

CONSOLIDATED – Corporate Law – In Thousands of Reais

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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BALANCE SHEET

CONSOLIDATED – Corporate Law – In Thousands of Reais

 

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CASH FLOW STATEMENT

CONSOLIDATED – Corporate Law – In Thousands of Reais

 

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EXPLANATORY NOTES TO THE FINANCIAL STATEMENTS
(In thousands of reais, unless otherwise noted)

 

1.DESCRIPTION OF BUSINESS

 

Companhia Siderúrgica Nacional (“CSN”, also referred to as “Company” or “Parent company”), is a publicly held company incorporated on April 9, 1941, under the laws of the Federative Republic of Brazil (Companhia Siderúrgica Nacional, its subsidiaries, joint ventures, joint operations and associates are collectively referred to herein as the "Group”). The Company’s registered office is located in São Paulo, SP, Brazil.

 

CSN is listed on the São Paulo Stock Exchange (B3 S.A. - Brasil, Bolsa, Balcão) and on the New York Stock Exchange (“NYSE”), reporting its information to the Brazilian Securities and Exchange Commission (“CVM”) and to the U.S. Securities and Exchange Commission (“SEC”).

 

The Group's main operating activities are divided into five 5 segments as follows:

 

·Steel:

 

The Company’s main industrial facility is the Presidente Vargas Steelworks (“UPV”), located in the city of Volta Redonda, State of Rio de Janeiro. This segment consolidates all operations related to the production, distribution and sale of flat steel, long steel, metallic containers and galvanized steel. In addition to the facilities in Brazil, CSN has commercial operations in the United States and operations in Portugal and Germany in order to gain markets and provide excellent services to final consumers. Its steel is used in home appliances, civil construction, package and automobile industries.

 

·Mining:

 

The production of iron ore is developed in the cities of Congonhas, Belo Vale and Ouro Preto, State of Minas Gerais, by its subsidiary CSN Mineração S.A. (“CSN Mineração”). The Company’s mining activities also include tin exploration in the state of Rondônia by CSN's subsidiary Estanho de Rondônia S.A. (“ERSA”), to supply the needs of the UPV. The surplus of this raw material is sold to subsidiaries and third parties.

 

Iron ore is sold basically in the international market, especially in Europe and Asia. The prices charged in these markets are historically cyclical and subject to significant fluctuations over short periods of time, driven by several factors related to global demand, strategies adopted by the major steel producers, and the foreign exchange rate. All these factors are beyond the Company’s control. The ore is transported by rail to the Terminal de Carvão e Minérios from the Itaguaí Port (“TECAR”), a solid bulk terminal, one of the four terminals that comprise the Itaguai Port, located in the State of Rio de Janeiro and from TECAR to customers around the world. The imports of coal and coke are also carried out through this terminal by provision of services by CSN Mineração to CSN.

 

As a pioneer in the use of technologies that result in the possibility of stacking the tailings generated in the iron ore production process, CSN Mineração has its iron ore production, since January 2020, 100% independent of tailings dams. After significant investments in recent years to raise the level of reliability, disposal and dry stacking, CSN Mineração has advanced to a scenario in which 100% of our tailings goes through a dry filtering process and are stacked in piles, geotechnically controlled, in areas exclusively destined for stacking.

 

As a consequence of these measures, decommissioning of dams is the natural path for processing filtered tailings. All of our mining dams are positively certified and comply with the environmental legislation in force.

 

·Cements:

 

CSN entered the cement market driven by the synergy between this activity and its existing businesses. The cement production unit located next to the UPV facilities, in Volta Redonda/RJ, produces CP-III type cement using slag produced by UPV's own blast furnaces. There is also the exploration of limestone and dolomite at the Arcos/MG unit to meet the needs of the steel industry and the cement factory, as well as the production of clinker at the same unit.

 

On August 31, 2021, the subsidiary CSN Cimentos S.A. (“CSN Cimentos”) concluded the acquisition of control of Elizabeth Cimentos S.A. and Elizabeth Mineração Ltda., operating in the Northeast region, especially in Paraíba and Pernambuco. On May 1, 2022, Elizabeth Mineração was merged into CSN Cimentos.

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On September 9, 2021, CSN Cimentos entered into the Agreement for the Sale and Purchase of the Shares in LafargeHolcim (Brasil) S.A., for the acquisition of 100% of the shares issued by LafargeHolcim (Brasil) S.A. (“LafargeHolcim”). On September 6, 2022, the acquisition of all shares issued by LafargeHolcim S.A. was completed, with the corporate name of LafargeHolcim being changed to "CSN Cimentos Brasil S.A.", which became controlled by CSN Cimentos. The Company's main activities are: production, industry and general trade of cement, lime, mortar, minerals and metals in general and complementary products for civil construction, in natura with industrial plants, warehouses and branches across a large part of the national territory.

 

On August 31, 2023, the Extraordinary General Meeting approved the incorporation of CSN Cimentos by CSN Cimentos Brasil with the consequent transfer of all assets, properties (movable and immovable), rights and obligations, in accordance with the terms of the “Protocol and Justification of the Incorporation of CSN Cimentos S.A. by CSN Cimentos Brasil S.A.”. Thus, CSN Cimentos was extinguished, all its shares were canceled and, in replacement, its shareholders received shares in CSN Cimentos Brasil. All activities carried out by CSN Cimentos are now carried out by CSN Cimentos Brasil. The Valuation Report of CSN Cimentos' assets was prepared on June 30, 2023, serving as the basis for determining a capital increase in CSN Cimentos Brasil in the amount of R$2,383,276.

 

·Logistics:

 

Railroads:

 

CSN has interests in three railroad companies: MRS Logística S.A. (“MRS”), which manages the former Southeast Railway System of Rede Ferroviária Federal S.A. (“RFFSA”), Transnordestina Logística S.A. (“TLSA”) and FTL - Ferrovia Transnordestina Logística S.A. (“FTL”), which holds the concession to operate the former Northeast Railway System of RFFSA, in the States of Maranhão, Piauí, Ceará, Rio Grande do Norte, Paraíba, Pernambuco, Alagoas - stretches from São Luís to Altos, Altos to Fortaleza, Fortaleza to Sousa, Sousa to Recife/Jorge Lins, Recife/Jorge Lins to Salgueiro, Jorge Lins to Propriá, Paula Cavalcante to Cabedelo, Itabaiana to Macau (Mesh I) and TLSA is responsible for the stretches from Eliseu Martins-Trindade, Trindade-Salgueiro, Salgueiro-Missão Velha and Missão Velha-Pecém (Mesh II), under construction.

 

Ports:

 

The Company operates in the State of Rio de Janeiro, by means of its subsidiary Sepetiba Tecon S.A., the Container Terminal (“TECON”) and by means of its subsidiary CSN Mineração, the TECAR, both located at the Itaguaí Port. Established in the harbor of Sepetiba, the mentioned port has a privileged highway, railroad, and maritime access.

 

TECON is responsible for the movement and storage of containers, vehicles, steel products, general cargo, among other products, and TECAR performs the operational activities of loading and unloading of solid bulk ships, storage and distribution (road and rail) of coal, coke, petroleum coke, clinker, zinc concentrate, sulfur, iron ore and other bulk, intended for the seaborne market, for our own operation and for different customers.

 

·Energy:

 

Since the energy supply is fundamental in CSN”s production process, the Company has electricity generation assets to mitigate costs, aiming at greater competitiveness.

 

On June 30, 2022, the Company's subsidiaries, CSN Cimentos and CSN Energia S.A. ("CSN Energia"), completed the acquisition of Santa Ana Energética S.A. (“Santa Ana”), as well as Topázio Energética S.A. ("Topázio") and, indirectly, Brasil Central Energia Ltda. ("BCE"), a subsidiary of Topázio, under the terms of the Share Purchase Agreement entered into on April 8, 2022 with Brookfield Americas Infrastructure (Brazil Power) Fundo de Investimento em Participações Multiestratégia, managed by Brookfield Brasil Asset Management Investimentos Ltda. On October 7, 2022, subsidiaries CSN Mineração and CSN Energia S.A. concluded the acquisition of 100% of the shares of Companhia Energética Chapecó – CEC, holder of the grant of Quebra-Queixo Hydroelectric Power Plant (“Chapecó”), as provided for in the Agreement for the Purchase and Sale of Shares and Other Covenants and in the Private Instrument of Assignment of Rights and Obligations entered into on July 1, 2022 and July 25, 2022, respectively.

 

In July 2022, The Company won the auction held by the State of Rio Grande do Sul, for the sale of 100% of the shares in its possession, 6,381,908 equivalent to 66.23% of the share capital, of Companhia Estadual de Energia Elétrica - CEEE-G, as part of the CEEE Group privatization program, in accordance with State Law 15.298/19.On October 21, 2022, the transaction was completed with payment by the company of the auction winning price. On December 22, 2022, the acquisition of Eletrobras' 32.74% interest in CEEE-G was concluded, and the Company currently holds 99% of the share capital of CEEE-G.

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·Going Concern:

 

Management understands that the Company has adequate resources to continue its operations. Accordingly, the Company's interim financial information for the period ended September 30, 2023, have been prepared on a going concern basis.

 

2.BASIS OF PREPARATION AND STATEMENT OF COMPLIANCE

 

2.a)Statement of compliance

 

The parent company and consolidated interim financial information (“interim financial information”) have been prepared and are being presented in accordance with the accounting practices adopted in Brazil issued by the Brazilian Accounting Pronouncements Committee (“CPC”), approved by the Brazilian Securities and Exchange Commission (“CVM”) and by the Brazilian Federal Accounting Council (“CFC”), and in accordance with the International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standard Board (“IASB”) and disclose all the relevant information of the interim financial information, and only this information, which corresponds to that used by the Company's management in its activities. The consolidated interim financial information are identified as “Consolidated” and the parent company's individual interim financial information are identified as “Parent Company”.

 

2.b)Basis of presentation

 

The interim financial statements were prepared based on the historical cost and were adjusted to reflect: (i) the fair value measurement of certain financial assets and liabilities (including derivative instruments), as well as pension plan assets; and (ii) impairment losses. When IFRS and CPCs allows the option between cost or another measurement criterion, the cost of acquisition criterion was used.

 

The preparation of these interim financial statements requires Management to use certain accounting estimates, judgments and assumptions that affect the application of Accounting Polices and the amounts reported on the balance sheet date of assets, liabilities, income, and expenses may differ from actual future results. The assumptions used are based on history and other factors considered relevant and are reviewed by the Company’s management.

 

The interim financial information has been prepared and is being presented in accordance with CPC 21 (R1) - “Interim Financial Reporting” and IAS 34 - “Interim Financial Reporting”, consistently with the standards issued by the CVM. This interim financial information does not include all requirements of annual or full financial statements and, accordingly, should be read in conjunction with the Company’s financial statements for the year ended December 31, 2022.

 

Therefore, in this interim financial information the following notes are not repeated, either due to redundancy or to the materiality in relation to those already presented in the annual financial statements:

 

Note 10 - Basis of consolidation and investments

Note 12 - Intangible assets

Note 18 - Income tax and social contribution

Note 19 - Installment taxes

Note 20 - Tax, social security, labor, civil, environmental provisions and judicial deposits

Note 29 - Information by business segment

Note 30 - Employee benefits

Note 31 - Commitments

 

The consolidated financial statements were approved by Board of Directors on November 13, 2023.

 

2.c)Functional currency and presentation currency

 

The accounting records included in the interim financial statements of each of the Company’s subsidiaries are measured using the currency of the principal of the economic environment in which each subsidiary operates (“the functional currency”). The consolidated and parent company interim financial statements are presented in BRL (reais), which is the Company’s functional and reporting currency.

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Foreign currency transactions are translated into the functional currency using the exchange rates prevailing on the transaction or valuation dates, in which the items are remeasured. The balances of the asset and liability accounts are converted using the exchange rate on the balance sheet date. As of September 30, 2023, US$1.00 was equivalent to BRL5.0076 (BRL5.2177 on December 31, 2022) and €1.00 was equivalent to BRL5.3000 (BRL5.5694 on December 31, 2022), according to the rates obtained from Central Bank of Brazil website.

 

2.d)Statement of value added

 

Pursuant to Law 11,638/07, the presentation of the statement of added value is required for all publicly held companies. These statements were prepared in accordance with CPC 09 - Added Value Statement, approved by CVM Resolution 557/08. The IFRS does not require the presentation of this statement and for IFRS purposes is presented as additional information.

3.CASH AND CASH EQUIVALENTS

 

      Consolidated       Parent Company
  09/30/2023   12/31/2022   09/30/2023   12/31/2022
Cash and banks              
In Brazil              66,387                85,120                29,600                49,794
Abroad        10,744,016            6,310,338              121,776              136,756
         10,810,403            6,395,458              151,376              186,550
               
Investments              
In Brazil          4,426,577            5,110,749            1,810,687            2,652,855
Abroad              65,640              485,149                  1,404                           
           4,492,217            5,595,898            1,812,091            2,652,855
         15,302,620          11,991,356            1,963,467            2,839,405

 

Our investments are basically in private and public securities with yields linked to the variation of Interbank Deposit Certificates (CDI) and repo operations backed by National Treasury Notes, respectively. The Company invests part of the funds through exclusive investment funds which have been consolidated in this interim financial information.

 

Our investments are in private securities in top-rated banks and are remunerated at pre-fixed rates.

 

4.FINANCIAL INVESTMENTS

 

                Consolidated               Parent Company
    Current   Non-current   Current   Non-current
    09/30/2023   12/31/2022   09/30/2023   12/31/2022   09/30/2023   12/31/2022   09/30/2023   12/31/2022
Investments (1)            38,491         271,590            16,731              15,675           30,371           22,715        
Usiminas shares (2)       1,106,108      1,184,895                                 1,106,108      1,184,895        
Bonds (3)                  115,175            140,510                  115,175          140,510
        1,144,599      1,456,485          131,906            156,185      1,136,479      1,207,610          115,175          140,510

(1)These are restricted financial investments and linked to a Bank Deposit Certificate (CDB) to guarantee a letter of guarantee from financial institutions and financial investments in Public Securities (LFT - Letras Financeiras do Tesouro) managed by their exclusive funds.
(2)A guarantee (fiduciary alienation) was constituted over a portion of the shares of Usiminas Siderúrgica de Minas Gerais S.A. held by the Company.
(3)Bonds with Banco Fibra maturing in February 2028 (see note 20.a).

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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5.      TRADE RECEIVABLES

 

      Consolidated       Parent Company
  09/30/2023   12/31/2022   09/30/2023   12/31/2022
Trade receivables              
Third parties              
Domestic market 1,690,718   1,636,804   1,089,062   860,942
Foreign market 1,612,720   1,720,056   38,940   92,679
  3,303,438   3,356,860   1,128,002   953,621
Expected credit losses       (220,460)         (232,830)         (116,806)         (122,872)
  3,082,978   3,124,030   1,011,196   830,749
Related parties (Note 20 a)          96,070   109,134   993,776   1,125,782
  3,179,048   3,233,164   2,004,972   1,956,531

 

The composition of the gross balance of accounts receivable from third party consumers is shown as follows:

 

        Consolidated       Parent Company
    09/30/2023   12/31/2022   09/30/2023   12/31/2022
Current       2,994,055       2,934,057          953,331          781,406
Past-due up to 30 days            38,009          163,959            16,291            37,036
Past-due up to 180 days            83,801            54,452            62,404            28,526
Past-due over 180 days          187,573          204,392            95,976          106,653
        3,303,438       3,356,860       1,128,002          953,621

 

The changes in estimated credit losses are as follows:

 

        Consolidated       Parent Company
    09/30/2023   12/31/2022   09/30/2023   12/31/2022
Opening balance         (232,830)         (236,927)         (122,872)         (133,227)
(Loss)/Reversal estimated              3,968                 (87)              3,475              1,623
Recovery and write-offs of receivables               8,402            13,197              2,591              8,732
Consolidation in the acquisition of companies                                    (9,013)                                              
Closing balance         (220,460)         (232,830)         (116,806)         (122,872)

 

6.INVENTORIES

 

      Consolidated       Parent Company
  09/30/2023   12/31/2022   09/30/2023   12/31/2022
Finished goods 3,524,674   4,421,166   1,977,693   2,308,211
Work in progress 2,994,954   3,501,145   1,372,784   2,123,539
Raw materials 2,665,375   3,297,213   1,780,210   2,492,779
Storeroom supplies  1,439,984   1,174,244   610,810   474,846
Advances to suppliers 59,700   37,619   29,984   30,170
Provision for losses             (89,745)              (96,493)              (22,542)              (16,124)
        10,594,942         12,334,894           5,748,939           7,413,421
               
Classified:              
Current 9,283,122   11,289,229   5,748,939   7,413,421
Non-current (1) 1,311,820   1,045,665        
        10,594,942         12,334,894           5,748,939           7,413,421

(1)Long-term iron ore inventories that will be used after the construction of the processing plant, which will produce pellet feed.

 

The changes in estimated losses on inventories are as follows:

 

45 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 

 

        Consolidated       Parent Company
    09/30/2023   12/31/2022   09/30/2023   12/31/2022
Opening balance           (96,493)           (98,730)           (16,124)           (14,426)
Reversal/(Estimated losses)  of inventories with low turnover and obsolescence            6,748              3,621             (6,418)             (1,698)
Consolidation in the acquisition of companies                 (1,384)        
Closing balance           (89,745)           (96,493)           (22,542)           (16,124)

 

7.RECOVERABLE TAXES

 

      Consolidated       Parent Company
  09/30/2023   12/31/2022   09/30/2023   12/31/2022
State Value-Added Tax         1,286,785           1,130,843             860,122             793,761
Brazilian federal contributions (1)         2,051,405           1,862,828           1,058,179           1,094,392
Other taxes           156,800             189,087             126,670             129,002
          3,494,990           3,182,758           2,044,971           2,017,155
               
Classified:              
Current         2,045,442           1,865,626           1,057,116           1,137,460
Non-current         1,449,548           1,317,132             987,855             879,695
          3,494,990           3,182,758           2,044,971           2,017,155

(1)In a judgment finalized on September 24, 2021, the Federal Supreme Court, with general repercussion, decided for the unconstitutionality of the levy of IRPJ and CSLL on amounts of interest on arrears at the SELIC rate received because of the repetition of undue tax payment. Although the decision is still pending publication, and the Company's specific lawsuit is still pending judgment, based on its best estimate to date CSN reassessed the judgment on this lawsuit, as required by ICPC 22/IFRIC 23 and recorded a credit in the amount of R$229,000. After the final and unappealable court decision of the Company's legal action, these amounts will be considered in the tax assessments, in accordance with Federal Tax Authorities of Brazil.

 

Credits arise mainly from ICMS, PIS and COFINS on purchases of raw materials and fixed assets, in accordance with current legislation. These credits are naturally realized through offsetting with debts of the same nature or with other federal taxes, in the cases authorized by law. Based on analyses and projections made by Management, the Company does not expect risks of non-realization of these tax credits.

 

8.OTHER CURRENT AND NON-CURRENT ASSETS

 

Other current and non-current assets are as follows:

 

              Consolidated               Parent Company
  Current   Non-current   Current   Non-current
  09/30/2023   12/31/2022   09/30/2023   12/31/2022   09/30/2023   12/31/2022   09/30/2023   12/31/2022
Judicial deposits (note 18)              506,817        533,664                210,796   231,627
Dividends receivables (note 20 a)      155,809          77,377                235,782        295,480        
Prepaid expenses      386,098        347,870          72,736          82,586        226,736        244,416          54,686          58,950
Prepaid expenses      301,720        311,087          37,259          47,109        226,736        244,416          26,614          30,878
Prepaid expenses with sea freight        84,378          36,783                        
Actuarial asset (note 20 a)                35,477          35,477                  28,072          28,072
Receivables from related parties          7,165            7,241      3,323,245      2,869,532        239,931        107,078      3,827,904      3,377,049
Loans with related parties (note 20 a )          5,335            5,383      1,617,913      1,384,773            5,335            5,383      2,020,000      1,668,382
Other receivables from related parties (note 20 a)          1,830            1,858      1,705,332      1,484,759        234,596        101,695      1,807,904      1,708,667
Other assets       208,579        344,012      1,255,579      1,263,936          39,336          63,216      1,222,201      1,222,894
Trading securities          8,096            9,596                    7,981            9,488        
Compulsory loans from Eletrobrás                54,254          58,030                  51,624          55,336
Employee debts        64,602          59,578                  31,333          28,101        
Receivables by indemnity (1)        22,209          1,169,494      1,166,353              1,169,494      1,166,353
Term of Agreement GSF DFESA        14,264          14,264          20,208          30,906                
Advances from Suppliers        13,233          12,335                        
Others        86,175        248,239          11,623            8,647                22          25,627            1,083            1,205
  757,651   776,500   5,158,377   4,749,718   741,785   710,190   5,315,587   4,890,520

(1)In April 2023, the subsidiary CEEE-G recognized the amount of R$ 37,486, referring to the Taxes and Contributions Amounts (VIC) of the Hydroelectric Plants committed to Physical Guarantee Quota Contracts (CCGFs).In the 3rd quarter of 2022, the uncontroversial amount of R$422,254 was recognized in the same account, as a refund of the amounts overpaid for railroad freight from April 1994 to March 1994 and March 1996 to the company RFFSA, and that after its extinction, the Federal Government became a defendant. Additionally, in 2020, a credit was recognized, which is a net, certain and payable amount, arising from the final and unappealable decision of a court in favor of the Company, due to losses and damages arising from voltage sinking in the energy supply in the periods from January/1991 to June/2002, in the amount of R$ 561,466.
46 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 
9.BASIS OF CONSOLIDATION AND INVESTMENTS

 

The information related to the activities of jointly controlled subsidiaries, joint operations, associates and other investments did not change in relation to what was disclosed in the Company's financial statements as of December 31, 2022. Therefore, Management decided not to repeat them in the accounting information interim of September 30, 2023.

 

47 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 
    Equity interests (%)    
Companies   09/30/2023   12/31/2022   Core business
Direct interest in subsidiaries: full consolidation            
CSN Islands VII Corp.          100.00          100.00   Financial transactions
CSN Inova Ventures          100.00          100.00   Equity interests and Financial transactions 
CSN Islands XII Corp.          100.00          100.00   Financial transactions
CSN Steel S.L.U.          100.00          100.00   Equity interests and Financial transactions 
TdBB S.A (*)          100.00          100.00   Equity interests
Sepetiba Tecon S.A.            99.99            99.99   Port services
Minérios Nacional  S.A.            99.99            99.99   Mining and Equity interests
Companhia Florestal do Brasil            99.99            99.99   Reforestation
Estanho de Rondônia S.A.            99.99            99.99   Tin Mining 
Companhia Metalúrgica Prada             99.89            99.89   Manufacture of containers and distribution of steel products
CSN Mineração S.A.            79.75            79.75   Mining 
CSN Energia S.A.             99.99            99.99   Sale of electric power
FTL - Ferrovia Transnordestina Logística S.A.             92.71            92.71   Railroad logistics
Nordeste Logística S.A.            99.99            99.99   Port services
CSN Inova Ltd.           100.00          100.00   Advisory and implementation of new development projec
CBSI - Companhia Brasileira de Serviços de Infraestrutura            99.99            99.99   Equity interests and product sales and iron ore
CSN Cimentos Brasil S.A.             99.99            99.99   Manufacturing and sale of cement 
Berkeley Participações e Empreendimentos S.A.           100.00          100.00   Electric power generation and equity interests
CSN Inova Soluções S.A.             99.90            99.99   Equity interests
CSN Participações I             99.90            99.99   Equity interests
Circula Mais Serviços de Intermediação Comercial S.A.              0.10              0.01   Commercial intermediation for the purchase and sale of assets and materials in general
CSN Participações III             99.90            99.99   Equity interests
CSN Participações IV            99.90            99.99   Equity interests
CSN Participações V            99.90            99.99   Equity interests
             
Indirect interest in subsidiaries: full consolidation            
Lusosider Projectos Siderúrgicos S.A.          100.00          100.00   Equity interests and product sales
Lusosider Aços Planos, S. A.            99.99            99.99   Steel and Equity interests
CSN Resources S.A.          100.00          100.00   Financial transactions and Equity interests
Companhia Brasileira de Latas             99.88            99.88   Sale of cans and containers in general and Equity interests
Companhia de Embalagens Metálicas MMSA             99.87            99.87   Production and sale of cans and related activities
Companhia de Embalagens Metálicas - MTM             99.87            99.87   Production and sale of cans and related activities
CSN Productos Siderúrgicos S.L.          100.00          100.00   Financial transactions, product sales and Equity interests
Stalhwerk Thüringen GmbH           100.00          100.00   Production and sale of long steel and related activities
CSN Steel Sections Polska Sp.Z.o.o           100.00          100.00   Financial transactions, product sales and Equity interests
CSN Mining Holding, S.L.U.            79.75            79.75   Financial transactions, product sales and Equity interests
CSN Mining GmbH            79.75            79.75   Financial transactions, product sales and Equity interests
CSN Mining Asia Limited            79.75            79.75   Commercial representation
Lusosider Ibérica S.A.           100.00          100.00   Steel, commercial and industrial activities and equity interests
CSN Mining Portugal, Unipessoal Lda.             79.75            79.75   Commercial and representation of products
Companhia Siderúrgica Nacional, LLC          100.00          100.00   Import and distribution/resale of products
Elizabeth Cimentos S.A.            99.98            99.98   Manufacturing and sale of cement 
Santa Ana Energética S.A.            99.98            99.99   Electric power generation
Topázio Energética S.A.             99.98            99.99   Electric power generation
Brasil Central Energia Ltda.             99.98            99.99   Electric power generation
Circula Mais Serviços de Intermediação Comercial S.A.            99.99            99.99   Commercial intermediation for the purchase and sale of assets and materials in general
Metalgráfica Iguaçu S.A             99.89            99.89   Metal packaging manufacturing
Companhia Energética Chapecó             79.75            79.75   Electric power generation
Companhia Estadual de Geração de Energia Elétrica - CEEE-G             98.95            98.96   Electric power generation
Ventos de Vera Cruz S.A.             98.95            98.95   Electric power generation
Ventos de Curupira S.A             98.95            98.95   Electric power generation
Ventos de Povo Novo S.A.             98.95            98.95   Electric power generation
MAZET - Maschinenbau Zerspanungstechnik GmbH (1)          100.00       Production and sale of long steel and related activities
             
Direct interest in joint operations: proportionate consolidation            
Itá Energética S.A.            48.75            48.75   Electric power generation
Consórcio da Usina Hidrelétrica de Igarapava            17.92            17.92   Electric power consortium
Consórcio Itaúba(2)            36.60            36.60   Electric power generation
Consórcio Passo Real (2)            46.97       Electric power generation
             
Direct interest in joint ventures: equity method            
MRS Logística S.A.            18.64            18.64   Railroad transportation
Aceros Del Orinoco S.A. (*)            31.82            31.82   Dormant company
Transnordestina Logística S.A.             48.03            48.03   Railroad logistics
Equimac S.A             50.00            50.00   Rental of commercial and industrial machinery and equipment
Consórcio Itaúba(2)            63.40            63.40   Electric power generation
Consórcio Passo Real (2)            53.03       Electric power generation
             
Indirect interest in joint ventures: equity method            
MRS Logística S.A.             14.86            14.86   Railroad transportation
             
Direct interest in associates: equity method            
Arvedi Metalfer do Brasil S.A.             20.00            20.00   Metallurgy and Equity interests
             
Indirect interest in affiliates: equity method            
Ventos da Lagoa Energia S.A.  (3)                10.00   Electric power generation
Jaguari Energética S.A.             10.39            10.39   Electric power generation
Chapecoense Geração S.A.               8.91              8.91   Electric power generation
Parques Eólicos Palmares S.A. (3)                10.00   Electric power generation
Ventos do Litoral Energia S.A. (3)                10.00   Electric power generation
Ventos dos índios Energia S.A. (3)                10.00   Electric power generation
Companhia Energética Rio das Antas - Ceran             29.69            29.69   Electric power generation
Ventos do Sul Energia S.A.              9.90            10.00   Electric power generation
Foz Chapecó Energia S.A.               8.91              8.91   Electric power generation
             
Exclusive funds: full consolidation            
Diplic II  - Private credit balanced mutual fund          100.00          100.00   Investment fund
Caixa Vértice - Private credit balanced mutual fund          100.00          100.00   Investment fund
VR1 - Private credit balanced mutual fund          100.00          100.00   Investment fund

(*) Dormant companies.

48 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 

 

(1) On June 1, 2023, MAZET - Maschinenbau Zerspanungstechnik GmbH was acquired by the indirect subsidiary Stalhwerk Thüringen GmbH.

 

(2) On December 26, 2022, the Itaúba Consortium was formed, with Companhia Siderúrgica Nacional S.A., with a 63.4% stake, and CSN Cimentos Brasil S.A., with a 36.6% stake. Additionally, on January 17, 2023, the Passo Real Consortium was formed, with the consortium members Companhia Siderúrgica Nacional S.A., Elizabeth Cimentos S.A., CSN Mineração S.A. and Minérios Nacional S.A., with stakes of 46.97%, 28.18%, 23.29% and 1.56%, respectively.

 

(3) CEEE-G sold its ownership interest in affiliated companies Ventos Lagoa Energia S.A., Parques Eólicos Palmares S.A., Ventos do Litoral Energia S.A. and Ventos dos Índios Energia S.A.

 

9.a)Changes in investments in subsidiaries, joint ventures, joint operations, associates and other investments

 

The positions presented as of September 30, 2023 and the changes refer to the interest held by CSN in these companies:

 

                            Consolidated
Companies   Final balance on 12/31/2022   Capital increase   Dividends   Equity Income (2)   Comprehensive income   Others   Final balance on 09/30/2023
             
             
Investments under the equity method                            
Joint-venture, Joint-operation and Affiliate                            
MRS Logistica         2,054,898                                                             337,534                           12        (16,181)         2,376,263
Fair Value MRS            480,622                                                                                                                                          480,622
Fair Value MRS amortization            (82,225)                                                                (8,809)                                                                 (91,034)
Transnordestina Logística S.A.         1,184,514                                                              (17,898)                                                             1,166,616
Fair Value -Transnordestina            659,106                                                                                                                                          659,106
Arvedi Metalfer do Brasil (affiliate)             25,782              11,037                                          (918)                                                                  35,901
Equimac S.A             18,482                                                                 3,782                                                                  22,264
Indirect interest in affiliates - CEEE-G (1)            216,307                                   (33,608)                34,680                                        (47,313)            170,066
Fair Value indirect participation CEEE-G (2)            359,024                                                              (39,315)                                                                319,709
Fair Value amortization indirect participation CEEE-G            (25,889)                                                                 6,648                                                                 (19,241)
          4,890,621              11,037          (33,608)              315,704                           12        (63,494)         5,120,272
                             
Equity interests evaluated by the cost method (3)             41,093                9,000                                              50,093
Investments at fair value through profit or loss (note 13)             94,700                                             (26,651)              68,049
Other             33,588                                             (24,282)                9,306
             169,381                9,000                    (50,933)            127,448
                             
Total shareholdings         5,060,002              20,037          (33,608)              315,704                           12       (114,427)         5,247,720
                             
Classification of investments in the balance sheet                            
Equity interests         5,060,002                             5,247,720
Investment Property            159,080                                212,079
Total investments in the asset         5,219,082                             5,459,799

(1) Refers mainly to the alienation by CEEE-G in the first quarter of its equity interest in affiliates Ventos Lagoa Energia S.A., Parques Eólicos Palmares S.A., Ventos do Litoral Energia S.A. and Ventos dos Índios Energia S.A., consequently, there was a write-off of these investments in the amount of (R$47,611), the effect of the operation was classified under the category of other operating expenses and revenues;

 

(2) The balance of R$359,024 refers to the Fair Value generated in the acquisition of the company CEEE-G, with the disposals mentioned in the item above, the Fair Value was written off in the amount of (R$39,314) referring to the capital gains of the companies sold, the effect of the write-off was classified under the equity method category;

 

(3) These are strategic investments in startups made by the subsidiary CSN Inova Ventures, which are valued using the cost method, in the following companies: Alinea Health Holdings Ltda. I.Systems Aut. Ind., 2D Materials, H2Pro Ltda, 1S1 Energy, Traive INC., OICO Holdings, Clarke Software and Global Dot, the latter acquired on June 5, 2023;

 

(4) The reconciliation of equity income from companies with shared control classified as joint ventures and associates with the amount presented in the income statement is presented below and results from the elimination of the results of CSN's transactions with these companies:

 

 

 

 

49 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 
      Consolidated
  09/30/2023   09/30/2022
   
Equity in results of affiliated companies      
MRS Logística S.A.            337,534              233,735
Transnordestina             (17,898)               (23,333)
Arvedi Metalfer do Brasil                 (918)                 3,466
Equimac S.A               3,782                 2,590
Indirect interest in affiliates - CEEE-G              34,680                      -   
Fair Value Amortization             (41,476)                (3,025)
             315,704              213,433
Other adjustments      
Cost of sales             (89,983)               (56,965)
To taxes              30,594                19,368
Others               3,267                (8,810)
Equity in results             259,582              167,026

(1) The operating margin of intercompany transactions with group companies classified as joint ventures, which are not consolidated, are reclassified in the Statement of Income from the Investment group to the costs and income tax and social contribution groups.

 

The changes in the Parent Company's investment are presented below:

 

50 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 
                             Parent Company 
Companies    Final balance on 12/31/2022    Increase (Decrease) of capital   Dividends    Equity Income     Comprehensive income    Others    Final balance on 09/30/2023 
             
             
Investments under the equity method                            
Subsidiaries                            
CSN Steel S.L.U.            5,028,262                                                                                 (98,317)            (173,714)                                           4,756,231
Sepetiba Tecon S.A.               294,460                                                                                 (17,317)                                                                            277,143
Minérios Nacional  S.A.               121,242                                                  6,390                     24,100                                                                            151,732
Fair Value - Minérios Nacional            2,123,507                                                                                                                                                                         2,123,507
Companhia Metalúrgica Prada               424,317                                                                                 (62,557)                                                                            361,760
Goodwill - Companhia Metalúrgica Prada                  63,509                                                                                                                                                                              63,509
CSN Mineração S.A.            9,086,716                                         (1,963,023)               1,762,488              241,047                                           9,127,228
CSN Energia S.A.                  56,736                                                                                 (18,734)                                                                              38,002
FTL - Ferrovia Transnordestina Logística S.A.               163,740                                                                                 (17,918)                                                                            145,822
Companhia Florestal do Brasil            1,300,726                                                 (4,270)                     56,782                   5,251                                           1,358,489
CBSI - Companhia Brasileira de Serviços de Infraestrutura                  29,057                                                    (933)                       6,684                                                                              34,808
Goodwill - CBSI - Companhia Brasileira de Serviços de Infraestrutura                  15,225                                                                                                                                                                              15,225
CSN Cimentos S.A. (1)            6,938,822                                                                               (163,710)                                       (6,775,112)                                
CSN Cimentos Brasil S.A.                                            6,775,112                                                 (38,021)                   2,301                                           6,739,392
Others                       120                     2,560                                                   (2,152)                                                                                    528
           25,646,439             6,777,672         (1,961,836)               1,431,328                74,885         (6,775,112)          25,193,376
Joint-venture, Joint-operation and Affiliate                                                        
Itá Energética S.A.               189,513                                                                                     5,743                                                                            195,256
MRS Logística S.A.            1,027,709                                                                                168,810                           6                 (8,094)             1,188,431
Transnordestina Logística S.A.            1,184,512                                                                                 (17,898)                                                                         1,166,614
Fair Value -Transnordestina               659,106                                                                                                                                                                            659,106
Equimac S.A                  18,482                                                                                     3,782                                                                              22,264
Arvedi Metalfer do Brasil (affiliate)                  25,783                   11,037                                                       (918)                                                                              35,902
             3,105,105                   11,037                                                159,519                           6                 (8,094)             3,267,573
Other participations                            
Investments at fair value through profit or loss (note 13)                  94,700                                                                                                                                            (26,651)                  68,049
Profits on subsidiaries' inventories                (67,640)                                                                                   76,807                                                                                 9,167
Other investments                          28                                                                                             1                                                                                      29
                   27,088                                                                                   76,808                                            (26,651)                  77,245
                             
Total shareholdings          28,778,632             6,788,709         (1,961,836)               1,667,655                74,891         (6,809,857)          28,538,194
                             
Subsidiaries with unsecured liabilities                            
CSN Islands VII Corp.          (2,661,734)                                                                                   75,495                                                                       (2,586,239)
CSN Inova Ventures          (1,755,949)                                                                               (305,826)                                                                       (2,061,775)
CSN Islands XII Corp.          (3,340,129)                                                                                     1,606                                                                       (3,338,523)
Estanho de Rondônia S.A.                (76,295)                                                                                 (32,603)                                                                          (108,898)
Total subsidiaries with unsecured liabilities          (7,834,107)                                                                               (261,328)                                                                       (8,095,435)
                             
Equity Income                           1,406,327            
                             
Classification of investments in the balance sheet                            
Equity interests          28,778,632                                                                                                                                                                      28,538,194
Investment Property               140,143                                                                                                                                                                            138,344
Total active investments          28,918,775                              28,676,538
Provision for Investments with Unsecured Liabilities (liabilities)          (7,834,107)                                                                                                                                                                       (8,095,435)
Total active and passive investments          21,084,668                              20,581,103

(1) On August 31, 2023, the reverse incorporation of CSN Cimentos into CSN Cimentos Brasil and the transfer of all assets, properties (movable and immovable), rights and obligations were approved.

 

9.b)Joint ventures and joint operations financial information

 

The balance sheet and income statement balances of the companies with shared control are shown below and refer to 100% of the companies’ results:

 

 

 

51 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 
                09/30/2023               12/31/2022
    Joint-Venture    Joint-Operation    Joint-Venture   Joint-Operation
Equity interest (%)   MRS Logística   Transnordestina Logística   Equimac S.A.   Itá Energética   MRS Logística   Transnordestina Logística   Equimac S.A.   Itá Energética
  37.27%   48.03%   50.00%   48.75%   37.27%   48.03%   50.00%   48.75%
Balance sheet                                
 Current Assets                                 
Cash and cash equivalents         1,744,910                        1,543                   9,103                      98,880           867,937                        1,164                        8,983                    46,946
Advances to suppliers            104,385                        3,633                        36                        1,389             29,500                      21,036                        1,384                      1,273
Other current assets         1,019,836                      67,175                 17,842                      27,113        1,351,335                      78,777                      11,648                    30,735
Total current assets         2,869,131                      72,351                 26,981                    127,382        2,248,772                    100,977                      22,015                    78,954
 Non-current Assets                                 
Other non-current assets            571,073                      99,335                      599                      18,397           887,987                    255,367                        1,643                    19,007
Investments, PP&E and intangible assets       12,102,558                11,815,712                 42,765                    303,388       11,541,779                11,029,525                      41,709                  325,911
Total non-current assets       12,673,631                11,915,047                 43,364                    321,785       12,429,766                11,284,892                      43,352                  344,918
Total Assets       15,542,762                11,987,398                 70,345                    449,167       14,678,538                11,385,869                      65,367                  423,872
                                 
Current Liabilities                                 
Borrowings and financing             870,439                    137,819                   6,766                                            735,231                    142,073                        5,497                               
Lease liabilities            538,290                                                       863                                            472,129                                                            701                               
Other current liabilities         1,608,480                      78,724                   6,692                      26,915        1,682,928                    150,268                        5,777                    14,326
Total current liabilities         3,017,209                    216,543                 14,321                      26,915        2,890,288                    292,341                      11,975                    14,326
 Non-current Liabilities                                 
Borrowings and financing          3,781,516                  7,557,342                   9,417                                         3,604,793                  7,142,895                      14,446                               
Lease liabilities         1,625,443                                                       253                                         1,928,931                                                            630                               
Other non-current liabilities            742,684                  1,785,025                   1,827                      21,727           740,892                  1,484,884                        1,353                    18,914
Total non-current liabilities         6,149,643                  9,342,367                 11,497                      21,727        6,274,616                  8,627,779                      16,429                    18,914
Shareholders’ equity         6,375,910                  2,428,488                 44,527                    400,525        5,513,634                  2,465,749                      36,963                  390,632
Total liabilities and shareholders’
equity
      15,542,762                11,987,398                 70,345                    449,167       14,678,538                11,385,869                      65,367                  423,872

 

                01/01/2023 a 09/30/2023               01/01/2022 a 09/30/2022
    Joint-Venture   Joint-Operation       Joint-Venture   Joint-Operation
Equity interest (%)   MRS Logística   Transnordestina Logística   Equimac S.A.   Itá Energética   MRS Logística   Transnordestina Logística   Equimac S.A.   Itá Energética
  37.27%   48.03%   50.00%   48.75%   37.27%   48.03%   50.00%   48.75%
Statements of Income                                
Net revenue         4,655,746                          562                      37,948                 145,136          4,118,869                          309                      28,351                 140,165
Cost of sales and services        (2,429,094)                                                      (20,782)                 (69,762)         (2,585,717)                                                      (17,480)                 (73,053)
Gross profit         2,226,652                          562                      17,166                  75,374          1,533,152                          309                      10,871                  67,112
Operating (expenses) income            (375,268)                     (30,859)                       (3,406)                 (62,265)            (182,821)                     (30,798)                       (2,535)                 (56,903)
Financial income (expenses), net           (483,120)                       (6,961)                       (2,196)                    4,425            (489,263)                     (18,881)                       (2,256)                    1,162
Income before income tax and social
contribution
        1,368,264                     (37,258)                      11,564                  17,534             861,068                     (49,370)                        6,080                  11,371
Current and deferred income tax
and social contribution
          (462,604)                                                          (848)                   (5,753)            (233,918)                                                          (900)                   (4,111)
Profit / (loss) for the period            905,660                     (37,258)                      10,716                  11,781             627,150                     (49,370)                        5,180                    7,260

 

9.c)TRANSNORDESTINA LOGÍSTICA S.A. (“TLSA”)

 

TSA is primarily engaged in the public service operation and development of a railroad network in the Northeast of Brazil, comprising the rail links Velha-Salgueiro, Salgueiro-Trindade, Trindade-Eliseu Martins, Salgueiro- Porto de Suape, and Missão Velha-Porto de Pecém (“Malha II”). On December 23, 2022, after extensive negotiations involving ANTT, TCU and the then Ministry of Infrastructure, signed first amendment to the Concession Agreement , which redefined the scope and deadlines for completion of the TLSA sections, notably to provide for the return of the section Salgueiro-Porto de Suape, which results in a project with the current 1,206 km of rail network and completion deadline up to December 2029.

 

Management relies on resources from its shareholders and third parties to complete the work, which is expected to be available, based on previously conducted agreements and recent discussions between the parties involved. After evaluating this matter, Management concluded that the use of the project’s business continuity accounting basis in the preparation of the interim financial information was considered appropriate.

 

9.d)Incorporation of CSN Cimentos S.A. by CSN Cimentos Brasil S.A.

 

On August 31, 2023, the reverse incorporation of CSN Cimentos into CSN Cimentos Brasil and the transfer of all assets, properties (movable and immovable), rights and obligations were approved. The Valuation Report of CSN Cimentos' net equity was prepared based on a specific balance sheet as of June 30, 2023.

 

As a result of the incorporation, the net equity of CSN Cimentos Brasil was increased by R$2,383,275,916.52 (two billion, three hundred and eighty-three million, two hundred and seventy-five thousand, nine hundred and sixteen reais and fifty-two cents), of which R$2,300,489,487.22 (two billion, three hundred million, four hundred and eighty-nine thousand, four hundred and eighty-seven reais and twenty-two cents) were allocated to the share capital and R$82,786,429.30 (eighty-two million, seven hundred and eighty-six thousand, four hundred and twenty-nine reais and thirty cents) to the capital reserve account.

52 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 

 

 

Balance Sheet (R$ 000)    Accounting collection as of June 30, 2023 
Cash and cash equivalents                               111,937
Trade receivables                                95,506
Inventories                               245,701
Other assets                                229,560
Corporate investments                            1,198,743
 Property, plant and equipment                             3,573,944
Intangíible assets                                889,979
Investment properties                                     631
Total Assets                            6,346,001
Trade payables                               375,049
Borrowings and financing                             2,678,625
Salaries and social charges                                15,432
 Taxes payable                                 42,383
Lease liabilities                                15,392
Tax, social security, labor and civil                                11,489
Provisions for environmental liabilities and asset decommissioning                                83,076
Other payables                               741,279
Total Liabilities                            3,962,725
     
Net assets                            2,383,276

 

9.e)Sale of shareholding – Consórcio Machadinho

 

The Machadinho Consortium is responsible for the exploration of HPP Machadinho, located on the Uruguay River, on the border of the states of Santa Catarina and Rio Grande do Sul, with an installed capacity of 1,140 MW and a physical guarantee of 519.8 average MW. CEEE-G's share in the Consortium was 5.53%, which implied the same percentage of costs and charges for the project under its responsibility.

 

As provided for in item 5.54 of the Privatization Notice of Auction Notice No. 01/2022 and under the terms of the contract establishing the Machadinho Consortium, the other consortium members exercised their right of preference to acquire the entire stake in CEEE-G. The sale of CEEE-G's stake in Consórcio Machadinho occurred after the parties agreed to all the terms and conditions of the definitive transaction documents and the usual conditions for closing.

 

Under the terms and conditions of the agreed contract, the completion of the transaction was subject to compliance with the Precedent Condition, with the closure subject to the parties obtaining prior approval from the National Electric Energy Agency – ANEEL to carry out the Transaction, the which was granted in August 2023. The Closing of the transaction was carried out on 09/29/2023, for the amount of R$ 114,763,385.98 (one hundred and fourteen million, seven hundred and sixty-three thousand, three hundred and eighty-five reais and ninety-eight cents).

 

9.f)Investment properties

 

The balance of investment properties is shown below:

 

53 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 
            Consolidated           Parent Company
    Land   Buildings    Total   Land   Buildings    Total
Balance at December 31, 2022       101,513                  57,567              159,080         94,257              45,886           140,143
Cost       101,513                  87,977              189,490         94,257              74,392           168,649
Accumulated depreciation                                    (30,410)              (30,410)                                (28,506)            (28,506)
Balance at December 31, 2022       101,513                  57,567              159,080         94,257              45,886           140,143
Acquisitions         48,000                                            48,000                                                                -   
Depreciation (note 24)                                      (2,299)                (2,299)                                  (1,799)              (1,799)
Transfer between groups - fixed assets and investment property          7,298                                              7,298                                                                -   
Balance at September 30, 2023       156,811                  55,268              212,079         94,257              44,087           138,344
Cost       156,811                  88,112              244,923         94,257              74,391           168,648
Accumulated depreciation                                    (32,844)              (32,844)                                (30,304)            (30,304)
Balance at September 30, 2023       156,811                  55,268              212,079         94,257              44,087           138,344

 

The Company’s estimate of the fair value of investment properties was made for December 31, 2022. The fair value of investment property in the consolidated balance as of September 30, 2023, and December 31, 2022 is R$2,163,610 and in the parent company R$2,097,290.

 

The estimated average useful lives for the periods are as follows (in years):

 

      Consolidated       Parent Company
  09/30/2023   12/31/2022   09/30/2023   12/31/2022
Buildings 27   27   28   28

 

10.PROPERTY, PLANT AND EQUIPMENT

 

                              Consolidated
  Land   Buildings and Infrastructure   Machinery, equipment and facilities   Furniture and fixtures   Construction in progress   Right of use (i)   Other (*)   Total
Balance at December 31, 2022    485,107         4,451,114         16,525,293         40,882        4,025,550          644,880          197,619        26,370,445
Cost    485,107         8,741,911         36,373,386       284,863        4,025,550       1,057,566          643,304        51,611,687
Accumulated depreciation                         (4,290,797)        (19,848,093)      (243,981)                                (412,686)         (445,685)       (25,241,242)
Balance at December 31, 2022    485,107         4,451,114         16,525,293         40,882        4,025,550          644,880          197,619        26,370,445
Effect of foreign exchange differences       (4,586)              (5,859)              (20,930)            (335)             (2,973)            (2,134)               (104)                 (36,921)
Acquisitions      46,495             41,397              202,304          1,439        2,572,342            70,397            14,453             2,948,827
Capitalized interest (1) (notes 26)                                                                                                 133,864                                                            133,864
Write-offs (note 25) (2)       (1,627)            (12,021)              (13,642)              (28)                                                              (47)                 (27,365)
Depreciation (note 24)                           (218,318)          (1,910,034)         (7,501)                                (113,531)           (44,445)            (2,293,829)
Transfers to other asset categories        2,304           171,690           1,952,991             354       (2,410,621)                                283,282                             
Transfer between groups - intangible assets and investment property       (6,637)            (21,528)                 3,420             101             (6,951)                                                             (31,595)
Right of use - Remesurement                                                                                                                         80,481                                        80,481
Mazet Acquisition                                   380                 5,040             390                                                             814                    6,624
Others                                   175                    730                               13,352                                                              14,257
Balance at September 30, 2023    521,056         4,407,030         16,745,172         35,302        4,324,563          680,093          451,572        27,164,788
Cost    521,056         8,887,061         37,408,300       284,600        4,324,563       1,162,831       1,856,401        54,444,812
Accumulated depreciation                         (4,480,031)        (20,663,128)      (249,298)                                (482,738)      (1,404,829)       (27,280,024)
Balance at September 30, 2023    521,056         4,407,030         16,745,172         35,302        4,324,563          680,093          451,572        27,164,788

 

                                Parent Company
    Land   Buildings and Infrastructure   Machinery, equipment and facilities   Furniture and fixtures   Construction in progress   Right of use (i)   Other (*)   Total
Balance at December 31, 2022         25,618           287,746           6,533,142         10,201          900,421         11,433         17,924          7,786,485
Cost         25,618           520,372         15,233,464       100,323          900,421         38,133       132,073            16,950,404
Accumulated depreciation                             (232,626)          (8,700,322)        (90,122)                              (26,700)      (114,149)            (9,163,919)
Balance at December 31, 2022         25,618           287,746           6,533,142         10,201          900,421         11,433         17,924          7,786,485
Acquisitions                                                          87,944                          1,040,122          3,990             176          1,132,232
Capitalized interest (1) (note 26)                                                                              46,503                                                    46,503
Write-offs (note 25)                                                              (659)                                                                                                 (659)
Depreciation (note 24)                               (13,187)             (833,431)         (1,352)                               (6,866)         (5,428)           (860,264)
Transfers to other asset categories                                     393           1,166,963                         (1,190,218)                            22,862                         
Transfer between groups - intangible assets and investment property                                                                              (4,623)                                                     (4,623)
Others                                                                (68)                                                                                                  (68)
Balance at September 30, 2023         25,618           274,952           6,953,891          8,849          792,205          8,557         35,534          8,099,606
Cost         25,618           520,766         16,487,592       100,323          792,205         41,583       155,220        18,123,307
Accumulated depreciation              (245,814)          (9,533,701)        (91,474)            (33,026)      (119,686)       (10,023,701)
Balance at September 30, 2023         25,618           274,952           6,953,891          8,849          792,205          8,557         35,534          8,099,606

(*) Refer substantially to: i) in the consolidated table: assets for railway use, such as yards, rails, mines, and sleepers; and ii) in the parent company's table: improvements to third-party assets, vehicles and hardware.

 

(1) The costs of capitalized borrowing are basically determined for the projects in Steelmaking and Mining and refer substantially, to:

54 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 

- CSN: Technological updates and acquisition of new equipment for maintenance of the production capacity of UPV Plant (RJ);

- CSN Mineração: Expansion of Casa de Pedra (MG) and TECAR (RJ).

 

(2) In September 2023, CEEE-G sold its stake in Consórcio Machadinho, where it recognized the write-off of assets related to this stake in the amount of R$22,326, an amount recognized in other operating expenses (see note 25).

 

(i)Right of use

 

Below are the movements of the right of use:

 

                  Consolidated
  Land   Buildings and Infrastructure   Machinery, equipment and facilities   Others   Total
Balance at December 31, 2022               465,048                   62,431                     83,161                 34,240                    644,880
Cost               548,756                 107,782                   277,865                123,164                 1,057,567
Accumulated depreciation                (83,708)                  (45,351)                  (194,704)                (88,924)                   (412,687)
Balance at December 31, 2022               465,048                   62,431                     83,161                 34,240                    644,880
Effect of foreign exchange differences                        -                       (1,315)                          133                     (952)                      (2,134)
Addition                 65,081                     4,400                            -                         917                     70,398
Remesurement                 16,704                   37,485                     20,948                   5,343                     80,480
Depreciation                 (25,380)                  (13,993)                    (56,906)                (17,252)                   (113,531)
Transfers to other asset categories                  (2,702)                     2,340                       2,296                  (1,934)                                
Balance at September 30, 2023               518,751                   91,348                     49,632                 20,362                    680,093
Cost            630,169             143,888                291,573              97,201             1,162,831
Accumulated depreciation           (111,418)              (52,540)               (241,941)             (76,839)               (482,738)
Balance at September 30, 2023               518,751                   91,348                     49,632                 20,362                    680,093

 

                Parent Company
    Land   Machinery, equipment and facilities   Others   Total
Balance at December 31, 2022             9,400                     1,870                    163                11,433
Cost            33,307                     2,639                 2,187                38,133
Accumulated depreciation           (23,907)                      (769)                (2,024)               (26,700)
Balance at December 31, 2022             9,400                     1,870                    163                11,433
Remesurement          3,906                         84                      -                     3,990
Depreciation          (6,112)                      (589)                   (165)                 (6,866)
Transfers to other asset categories                201                      (203)                       2                           
Balance at September 30, 2023             7,395                     1,162                      -                     8,557
Cost            37,415                     2,477                 1,691                41,583
Accumulated depreciation           (30,020)                    (1,315)                (1,691)               (33,026)
Balance at September 30, 2023             7,395                     1,162                      -                     8,557

 

The estimated average useful lives are as follows (in years):

 

      Consolidated       Parent Company
  09/30/2023   12/31/2022   09/30/2023   12/31/2022
Buildings and Infrastructure 34   34   31   31
Machinery, equipment and facilities 18   18   19   20
Furniture and fixtures 11   12   13   13
Others 11   9   11   12

 

 

 

 

 

 

55 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 

11.   INTANGIBLE ASSETS

 

                          Consolidated       Parent Company
  Goodwill   Customer relationships   Software   Trademarks
and
patents
  Rights and licenses (*)   Others   Total   Software   Total
Balance at December 31, 2022    4,131,483          152,484              87,846         225,187           6,188,654         2,400      10,788,054         59,499            59,499
 Cost         4,371,890              753,307                296,456             226,581               6,400,593             2,400          12,051,227           178,747              178,747
 Accumulated amortization           (131,077)             (600,823)               (208,610)               (1,394)                 (211,939)                                 (1,153,843)          (119,248)             (119,248)
 Adjustment for accumulated recoverable value           (109,330)                                                                                                                                                  (109,330)                                                   
Balance at December 31, 2022    4,131,483          152,484              87,846         225,187           6,188,654         2,400      10,788,054         59,499            59,499
 Effect of foreign exchange differences                                    (4,983)                  (163)            (9,104)                                      (116)            (14,366)                                           
 Acquisitions                                    349                1,063                                                                                 1,412                                           
 Transfer between groups - fixed assets and investment property              (5,228)                                              9,180                     83                    20,262                                      24,297               4,623                  4,623
 Amortization (note 24)                               (57,694)             (15,228)            (2,165)             (110,662)                            (185,749)          (9,314)             (9,314)
 Others                                                              652                                                                                    652                                           
Balance at September 30, 2023    4,126,255            90,156              83,350         214,001           6,098,254         2,284      10,614,300         54,808            54,808
 Cost     4,675,302          718,929            301,357         217,560           6,422,018         2,284      12,337,450        183,370           183,370
 Accumulated amortization       (549,047)         (628,773)           (218,007)            (3,559)             (323,764)                         (1,723,150)       (128,562)          (128,562)
Balance at September 30, 2023    4,126,255            90,156              83,350         214,001           6,098,254         2,284      10,614,300         54,808            54,808

(*) Composed mainly of: (i) mining rights whose amortization is based on production volume and (ii) Concession agreement for the use of water resources in the acquisition of control of Companhia Estadual de Geração de Energia Elétrica, amortized over the agreement term (note 3.c).

 

The estimated average useful lives are as follows (in years):

 

      Consolidated       Parent Company
  09/30/2023   12/31/2022   09/30/2023   12/31/2022
Software 10   10   10   10
Customer relationships 13   13        

 

11.a)Goodwill impairment test

 

Goodwill arising from expected future profitability of acquired companies and intangible assets with indefinite useful lives (brands) were allocated to CSN’s cash generating units (CGUs) which represent the lowest level of assets or group of assets of the Company. According to NBC TG 01(R4)/IAS36, when a CGU has an intangible asset with no defined useful life allocated, the Company must perform an impairment test.

 

The assumptions used for impairment assessment in December 2022 remain in place and there is no event that would justify recording impairment on September 30, 2023.

 

12.BORROWINGS, FINANCING AND DEBENTURES

 

The balances of borrowings, financing and debentures that are recorded at amortized cost are as follows:

 

56 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 
                  Consolidated             Parent Company
      Current Liabilities     Non-current Liabilities    Current Liabilities   Non-current Liabilities 
      09/30/2023   12/31/2022   09/30/2023   12/31/2022   09/30/2023   12/31/2022 09/30/2023   12/31/2022
                                 
Foreign Debt                                
Floating Rates:                                
Prepayment           587,584      1,571,208      6,916,730      5,474,359             197,206         956,219     1,869,079           1,147,894
Fixed Rates:                                
Bonds, Perpetual bonds, Facility, CCE and ACC        2,672,443      1,189,717    16,102,336    16,790,284          2,061,884         616,954        751,140              782,655
Intercompany                                                                                                           624,413           43,196     6,756,884           8,216,508
Fixed interest in EUR                                
Intercompany                                                                                                        1,065,513                858        662,047           1,767,536
Facility           378,102           62,187         126,139         166,302                                                                                                    
         3,638,129      2,823,112    23,145,205    22,430,945          3,949,016      1,617,227   10,039,150         11,914,593
                                 
Debt agreements in Brazil                                
Floating Rate Securities in R$:                                
BNDES/FINAME/FINEP, Debentures, NCE and CCB        2,502,516      2,446,840    14,910,155    13,740,051          2,230,637      1,827,077 7,282,210   6,110,174
         2,502,516      2,446,840    14,910,155    13,740,051   2,230,637   1,827,077 7,282,210   6,110,174
Total Borrowings and Financing        6,140,645      5,269,952    38,055,360    36,170,996          6,179,653      3,444,304   17,321,360         18,024,767
Transaction Costs and Issue Premiums            (89,624)          (76,316)        (532,160)        (445,890)              (23,210)          (25,285)        (60,690)               (30,518)
Total Borrowings and Financing + Transaction cost     6,051,021   5,193,636   37,523,200   35,725,106   6,156,443   3,419,019 17,260,670   17,994,249

 

12.a)Borrowing and amortization, financing, and debentures

 

The following table shows amortization and funding during the period:

 

        Consolidated       Parent Company
    09/30/2023   12/31/2022   09/30/2023   12/31/2022
Opening balance           40,918,742             32,507,522             21,413,268              20,432,844
New debts            9,994,046             20,248,223              6,327,750               9,922,074
Repayment           (6,401,408)            (10,782,858)             (4,119,008)              (8,270,606)
Payments of charges           (2,376,367)              (2,315,586)             (1,002,965)              (1,128,874)
Accrued charges (note 26)            2,744,583               2,595,011              1,350,256               1,270,946
Consolidation of companies                                               81,978                                                             
Others (1)           (1,305,375)              (1,415,548)                (552,188)                 (813,116)
Closing balance           43,574,221             40,918,742             23,417,113              21,413,268

(1)Including unrealized exchange and monetary variations and funding cost.

 

The Company raised and amortized borrowings, financing and debentures during 2023, as shown below:

 

                Consolidated
                09/30/2023
Nature   New debts   Maturities   Repayment   Interest payment
Pre-Payment        1,890,333    2023 to 2028            (1,111,083)                       (301,860)
Bonds, ACC, CCE and Facility         3,732,296    2023 to 2024            (2,050,568)                       (692,384)
BNDES/FINAME/FINEP, Debentures, NCE, Facility and CCB        4,371,417    2023 to 2025            (3,239,757)                    (1,382,123)
         9,994,046               (6,401,408)                    (2,376,367)

 

 

 

 

 

 

 

 

 

 

57 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 
12.b)Maturities of borrowings, financing and debentures presented in current and non-current liabilities

 

            Consolidated           Parent Company
            09/30/2023           09/30/2023
    Borrowings and financing in foreign currency   Borrowings and financing in national currency   Total   Borrowings and financing in foreign currency   Borrowings and financing in national currency   Total
Average rate   in Dollar 6.81% in Euro 5.49%   in Real 14.32%     in Dollar 4.56% in Euro 3.41%   in Real 14.43%  
2023                      1,545,426                      1,182,382                      2,727,808                      1,218,433                         963,229                      2,181,662
2024                      2,302,924                      3,887,860                      6,190,784                      2,812,398                      1,788,626                      4,601,024
2025                      3,165,621                      1,789,986                      4,955,607                      3,030,141                      1,320,598                      4,350,739
2026                      2,874,253                      2,368,226                      5,242,479                         769,663                      1,812,598                      2,582,261
2027                         937,703                      2,360,969                      3,298,672                           91,138                      1,832,098                      1,923,236
2028 to 2031                    12,830,896                      3,007,220                    15,838,116                      3,321,163                      1,383,320                      4,704,483
After 2031                      3,126,511                      2,816,028                      5,942,539                      2,745,230                         412,378                      3,157,608
                     26,783,334                    17,412,671                    44,196,005                    13,988,166                      9,512,847                    23,501,013

 

·      Covenants

 

The Company maintains contracts that provide for the fulfillment of certain non-financial obligations, as well as the maintenance of certain parameters and performance indicators, such as the equity ratio disclosure of its audited interim financial information according to regulatory deadlines or payment of commission for risk assumption, if the indicator of net debt to EBITDA reaches the levels foreseen in those contracts.

 

To the moment, the Company is compliant with the financial and non-financial obligations (covenants) of its existing contracts.

 

13.   FINANCIAL INSTRUMENTS

 

13.a)Identification and valuation of financial instruments

 

The Company may operate with several financial instruments, with emphasis on cash and cash equivalents, including financial investments, marketable securities, accounts receivable from customers, accounts payable to suppliers and borrowings and financing. Additionally, we may also operate with derivative financial instruments, such as swap exchange rate swap, swap interest and derivatives with commodities.

 

Considering the nature of these instruments, their fair value is basically determined by the use of quotations in the capital markets in Brazil and the Mercantile and Futures Exchange. The amounts recorded in current assets and liabilities have immediate liquidity or maturity, mostly in the short term. Considering the terms and characteristics of these instruments, the carrying amounts approximate the fair values.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

58 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 
·Classification of financial instruments

 

                                    Consolidated
Consolidated           09/30/2023       12/31/2022
  Notes   Fair value through other comprehensive income   Fair value through profit or loss   Measured at amortized cost   Balances   Fair value through other comprehensive income   Fair value through profit or loss   Measured at amortized cost   Balances
                 
Assets                                    
Current                                    
Cash and cash equivalents           3                                                           15,302,620      15,302,620                                      11,991,356      11,991,356
Short-term investments           4                                          1,106,108                 38,491        1,144,599            1,184,895              271,590        1,456,485
Trade receivables           5                                                             3,179,048        3,179,048                                        3,233,164        3,233,164
Dividends and interest on equity           8                                                                        155,808          155,808                                            77,377            77,377
Trading securities           8                                        8,096                                         8,096                   9,596                                         9,596
Loans - related parties           8                                                                   5,335              5,335                                                                   5,383              5,383
Total                                      1,114,204          18,681,302      19,795,506                                 1,194,491          15,578,870      16,773,361
                                     
Non-current                                    
Investments           4                                                                        131,906          131,906                                                                       156,185          156,185
Other trade receivables           8                                                                  10,406            10,406                                                                   8,059              8,059
Eletrobrás compulsory loan           8                                                                  54,254            54,254                                                                 58,030            58,030
Receivables by indemnity           8                                                                988,148          988,148                                                               974,863          974,863
Loans - related parties           8                                                                     1,617,913        1,617,913                                                                     1,384,773        1,384,773
Investments           9                                       68,049                                       68,049                                      94,700                                       94,700
Total                                           68,049            2,802,627        2,870,676                                      94,700            2,581,910        2,676,610
                                     
Total Assets                                      1,182,253          21,483,929      22,666,182                                 1,289,191          18,160,780      19,449,971
                                     
Liabilities                                                                          
Current                                    
Borrowings and financing          12                                                             6,140,645        6,140,645                                                             5,269,952        5,269,952
Leases         14                                                                144,781          144,781                                                               177,010          177,010
Trade payables         15                                                             7,047,849        7,047,849                                                             6,596,915        6,596,915
Trade payables -  drawee risk         16                                                             2,993,574        2,993,574                                                             5,709,069        5,709,069
Dividends and interest on capital         16                                                                   4,939              4,939                                                               611,307          611,307
Derivative financial instruments (note 16)                    87,099            43,421                                     130,520             416,935                                                             416,935
Total                    87,099            43,421          16,331,788      16,462,308             416,935                                  18,364,253      18,781,188
                                     
Non-current                                    
Borrowings and financing          12                                                           38,055,360      38,055,360                                                           36,170,996      36,170,996
Leases         14                                                                595,795          595,795                                                               516,836          516,836
Trade payables         15                                                                  16,560            16,560                                                                 46,269            46,269
Derivative financial instruments (note 16)         16                                       50,520                                       50,520                                      69,472                                       69,472
Total                                           50,520          38,667,715      38,718,235                                      69,472          36,734,101      36,803,573
                                     
Total Liabilities                    87,099            93,941          54,999,503      55,180,543             416,935             69,472          55,098,354      55,584,761

 

 

 

 

 

 

 

 

 

 

 

 

 

 

59 

Quarterly Financial Information – September 30, 2023 – Companhia Siderúrgica Nacional

(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

 
                            Parent Company
Parent Company           09/30/2023       12/31/2022
  Notes   Fair value through profit or loss   Measured at amortized cost   Balances   Fair value through profit or loss   Measured at amortized cost   Balances
             
Assets                            
Current                            
Cash and cash equivalents           3                                1,963,467        1,963,467                                2,839,405        2,839,405
Short-term investments           4       1,106,108               30,371        1,136,479       1,184,895               22,715        1,207,610
Trade receivables           5                                2,004,972        2,004,972                                1,956,531        1,956,531
Dividends and interest on equity           8                                   235,782          235,782                                   295,480          295,480
Trading securities           8             7,981                                       7,981             9,488                                       9,488
Loans - related parties           8                                      5,335              5,335                                      5,383              5,383
Total           1,114,089          4,239,927        5,354,016       1,194,383          5,119,514        6,313,897
                                                
Non-current                                               
Investments           4                                   115,175          115,175                                   140,510          140,510
Other trade receivables           8                                      1,003              1,003                                      1,003              1,003
Eletrobrás compulsory loan           8                                     51,624            51,624                                     55,336            55,336
Receivables by indemnity           8                                   988,148          988,148                                   974,863          974,863
Loans - related parties           8                                2,020,000        2,020,000                                1,668,382        1,668,382
Investments           9            68,049                                     68,049            94,700                                     94,700
Total                68,049          3,175,950        3,243,999            94,700          2,840,094        2,934,794
                             
Total Assets           1,182,138          7,415,877        8,598,015       1,289,083          7,959,608        9,248,691
                             
Liabilities