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____
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Company Information |
|
Capital Breakdown |
1 |
Cash Distribution |
2 |
Parent Company Financial Statements |
|
Balance Sheet – Assets |
3 |
Balance Sheet – Liabilities |
4 |
Statement of Income |
5 |
Statement of Comprehensive Income |
6 |
Statement of Cash Flows |
7 |
Statement of Changes in Shareholders’ Equity |
|
1/1/2014 to 3/31/2014 |
8 |
1/1/2013 to 3/31/2013 |
9 |
Statement of Value Added |
10 |
Consolidated Financial Statements |
|
Balance Sheet - Assets |
11 |
Balance Sheet - Liabilities |
12 |
Statement of Income |
13 |
Statement of Comprehensive Income |
14 |
Statement of Cash Flows |
15 |
Statement of Changes in Shareholders’ Equity |
|
1/1/2014 to 3/31/2014 |
16 |
1/1/2013 to 3/31/2013 |
17 |
Statement of Value Added |
18 |
Comments on the Company’s Consolidated Performance |
19 |
Notes to the Financial Statements |
29 |
Reports and Statements |
|
Unqualified Independent Auditors’ Review Report |
70 |
PAGE 1 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Company Information / Capital Breakdown
Number of Shares (Units) |
Current Quarter 3/31/2014 |
|
Paid-in Capital |
|
|
Common |
1,457,970,108 |
|
Preferred |
0 |
|
Total |
1,457,970,108 |
|
Treasury Shares |
|
|
Common |
0 |
|
Preferred |
0 |
|
Total |
0 |
|
PAGE 1 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Company Information / Cash distribution |
||||||
Event |
Approval |
Dividends |
Inition Payment |
Type of share |
Class of share |
Dividends per common share (R$/share) |
Meeting of Board of Directors |
02/28/2014 |
Dividends |
03/11/2014 |
Ordinary |
|
0.29150 |
PAGE 2 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Parent Company Statements / Balance Sheet - Assets |
| ||
(R$ thousand) |
| ||
| |||
Code |
Description |
Current Quarter |
YTD Previous Year 12/31/2013 |
1 |
Total assets |
48,068,505 |
48,689,176 |
1.01 |
Current assets |
4,685,496 |
5,054,174 |
1.01.01 |
Cash and cash equivalents |
240,974 |
206,624 |
1.01.03 |
Trade receivables |
1,320,190 |
1,992,704 |
1.01.04 |
Inventories |
2,702,701 |
2,459,230 |
1.01.08 |
Other current assets |
421,631 |
395,616 |
1.02 |
Non-current assets |
43,383,009 |
43,635,002 |
1.02.01 |
Long-term receivables |
4,257,367 |
4,134,846 |
1.02.01.06 |
Deferred taxes |
2,926,969 |
2,612,998 |
1.02.01.09 |
Other non-current assets |
1,330,398 |
1,521,848 |
1.02.02 |
Investments |
26,593,365 |
27,005,592 |
1.02.03 |
Property, plant and equipment |
12,449,898 |
12,418,095 |
1.02.04 |
Intangible assets |
82,379 |
76,469 |
PAGE 3 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Parent Company Statements / Balance Sheet – Liabilities |
|||
(R$ thousand) |
|||
Code |
Description |
Current Quarter |
YTD Previous Year |
2 |
Total liabilities |
48,068,505 |
48,689,176 |
2.01 |
Current liabilities |
5,445,228 |
6,503,789 |
2.01.01 |
Payroll and related taxes |
140,356 |
159,892 |
2.01.02 |
Trade payables |
1,086,870 |
926,935 |
2.01.03 |
Taxes payable |
114,245 |
150,066 |
2.01.04 |
Borrowings and financing |
2,698,595 |
3,854,694 |
2.01.05 |
Other payables |
1,089,665 |
1,138,956 |
2.01.06 |
Provisions |
315,497 |
273,246 |
2.01.06.01 |
Provision for tax, social security, labor and civil risks |
315,497 |
273,246 |
2.02 |
Non-current liabilities |
35,367,184 |
34,088,817 |
2.02.01 |
Borrowings and financing |
22,416,678 |
21,394,660 |
2.02.02 |
Other payables |
10,362,458 |
10,173,732 |
2.02.04 |
Provisions |
2,588,048 |
2,520,425 |
2.02.04.01 |
Provision for tax, social security, labor and civil risks |
469,446 |
438,114 |
2.02.04.02 |
Other provisions |
2,118,602 |
2,082,311 |
2.02.04.02.03 |
Provision for environmental liabilities and Asset retirement obligation - ARO |
354,352 |
365,716 |
2.02.04.02.04 |
Pension and healthcare plan |
485,084 |
485,084 |
2.02.04.02.05 |
Provision for losses on investments |
1,279,166 |
1,231,511 |
2.03 |
Shareholders’ equity |
7,256,093 |
8,096,570 |
2.03.01 |
Issued capital |
4,540,000 |
4,540,000 |
2.03.02 |
Capital reserves |
30 |
30 |
2.03.04 |
Earnings reserves |
2,414,568 |
2,839,568 |
2.03.04.01 |
Legal reserve |
361,641 |
361,641 |
2.03.04.02 |
Statutory reserve |
2,052,927 |
2,477,927 |
2.03.05 |
Retained earnings/Accumulated losses |
55,334 |
- |
2.03.08 |
Other comprehensive income |
246,161 |
716,972 |
|
|
|
|
PAGE 4 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Parent Company Statements / Statements of Income |
|||
(R$ thousand) |
|||
Code |
Description |
Current Quarter |
YTD PreviousYear |
3.01 |
Net revenue from sales and/or services |
3,490,453 |
2,853,215 |
3.02 |
Cost of sales and/or services |
-2,311,229 |
-2,205,276 |
3.03 |
Gross profit |
1,179,224 |
647,939 |
3.04 |
Operating expenses/income |
-632,776 |
-372,878 |
3.04.01 |
Selling expenses |
-97,377 |
-109,267 |
3.04.02 |
General and administrative expenses |
-82,863 |
-76,129 |
3.04.04 |
Other operating income |
4,646 |
3,518 |
|
|
||
3.04.05 |
Other operating expenses |
-166,057 |
-78,527 |
3.04.06 |
Share of profits of investees |
-291,125 |
-112,473 |
3.05 |
Profit before finance income (costs) and taxes |
546,448 |
275,061 |
3.06 |
Finance income (costs) |
-578,827 |
-465,239 |
3.06.01 |
Finance income |
8,569 |
25,033 |
3.06.02 |
Finance costs |
-587,396 |
-490,272 |
3.06.02.01 |
Net exchange losses on financial instruments |
314,502 |
116,213 |
3.06.02.02 |
Finance costs |
-901,898 |
-606,485 |
3.07 |
Loss before taxes on income |
-32,379 |
-190,178 |
3.08 |
Income tax and social contribution |
87,713 |
217,504 |
3.09 |
Profit from continuing operations |
55,334 |
27,326 |
3.11 |
Profit for the period |
55,334 |
27,326 |
3.99 |
Earnings per share - (R$/share) |
||
3.99.01 |
Basic earnings per share |
||
3.99.01.01 |
Common shares |
0.03796 |
0.01874 |
3.99.02 |
Diluted earnings per share |
|
|
3.99.02.01 |
Common shares |
0.03796 |
0.01874 |
PAGE 5 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Parent Company Statements / Statement of Comprehensive Income | |||
(R$ thousand) |
|||
Code |
Description |
Current Quarter |
YTD Previous Year |
4.01 |
Profit for the period |
55,334 |
27,326 |
4.02 |
Other comprehensive income |
-470,811 |
-297,983 |
4.02.01 |
Cumulative translation adjustments for the period |
-44,326 |
-43,239 |
4.02.02 |
Actuarial (losses) gains on defined benefit pension plan |
1,710 |
0 |
4.02.04 |
Available-for-sale assets |
-631,003 |
-287,389 |
4.02.05 |
Income tax and social contribution on available-for-sale assets |
214,541 |
97,712 |
4.02.06 |
Available-for-sale assets from investments in subsidiaries |
-11,733 |
-65,067 |
4.03 |
Comprehensive income for the period |
415,477 |
-270,657 |
|
|
|
|
PAGE 6 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Parent Company Statements / Statement of Cash Flows – Indirect Method | |||
(R$ thousand) |
|||
Code |
Description |
YTD Current Year |
YTD Previous Year |
6.01 |
Net cash generated by operating activities |
362,699 |
64,520 |
6.01.01 |
Cash generated from operations |
1,033,504 |
598,354 |
6.01.01.01 |
Profit for the period |
55,334 |
27,326 |
6.01.01.02 |
Charges on borrowings and financing |
756,064 |
562,637 |
6.01.01.03 |
Charges on loans and financing granted |
-3,896 |
-7,203 |
6.01.01.04 |
Depreciation, depletion and amortization |
234,661 |
236,615 |
6.01.01.05 |
Share of profits of investees |
291,125 |
112,473 |
6.01.01.06 |
Deferred income tax and social contribution |
-99,430 |
-217,504 |
6.01.01.07 |
Provision for tax, social security, labor, civil and environmental risks |
62,219 |
13,321 |
6.01.01.08 |
Monetary variation and exchange differences, net |
-322,072 |
-111,209 |
6.01.01.09 |
Gain on derivative transactions |
636 |
1,197 |
6.01.01.11 |
Residual value of permanent assets written off |
4,288 |
0 |
6.01.01.14 |
Other provisions |
54,575 |
-19,299 |
6.01.02 |
Changes in assets and liabilities |
-670,805 |
-533,834 |
6.01.02.01 |
Trade receivables - third parties |
-48,430 |
-82,148 |
6.01.02.02 |
Trade receivables - related parties |
-109,782 |
-97,255 |
6.01.02.03 |
Inventories |
-226,215 |
79,918 |
6.01.02.05 |
Recoverable taxes |
-690 |
20,113 |
6.01.02.06 |
Judicial deposits |
-2,598 |
8,296 |
6.01.02.07 |
Dividends received from related parties |
205,259 |
870 |
6.01.02.09 |
Trade payables |
108,615 |
-107,040 |
6.01.02.10 |
Payroll and related taxes |
7,920 |
23,808 |
6.01.02.11 |
Taxes in installments - REFIS |
-67,415 |
-20,046 |
6.01.02.13 |
Payables to related parties |
6,488 |
-1,183 |
6.01.02.15 |
Interest paid |
-545,210 |
-339,791 |
6.01.02.17 |
Interest received - related parties |
13,563 |
2,203 |
6.01.02.18 |
Interest on swaps paid |
-633 |
-1,050 |
6.01.02.19 |
Other |
-11,677 |
-20,529 |
6.02 |
Net cash used in investing activities |
-91,530 |
-440,840 |
6.02.01 |
Investments |
-19,818 |
-15,942 |
6.02.02 |
Purchase of property, plant and equipment |
-235,967 |
-279,829 |
6.02.04 |
Purchase of intangible assets |
0 |
-12 |
6.02.05 |
Related parties loans |
-3,860 |
-159,367 |
6.02.06 |
Receipt of related parties loans |
168,115 |
14,310 |
6.03 |
Net cash used in financing activities |
-236,819 |
-56,422 |
6.03.01 |
Borrowings and financing raised |
690,556 |
350,078 |
6.03.02 |
Borrowings and financing raised - related parties |
116,640 |
0 |
6.03.03 |
Repayment of borrowings |
-594,833 |
-87,649 |
6.03.04 |
Repayment of borrowings - related parties |
-24,312 |
-18,909 |
6.03.05 |
Dividends and interest on capital paid |
-424,870 |
-299,942 |
6.04 |
Exchange differences on translating cash and cash equivalents |
0 |
5,893 |
6.05 |
Increase (decrease) in cash and cash equivalents |
34,350 |
-426,849 |
6.05.01 |
Cash and equivalents at the beginning of the period |
206,624 |
2,995,757 |
6.05.02 |
Cash and equivalents at the end of the period |
240,974 |
2,568,908 |
PAGE 7 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Parent Company Statements / Statement of Changes in Shareholders´ Equity - 1/1/2014 to 03/31/2014 | |||||||
(R$ thousand) |
|||||||
Code |
Description |
Paid-in capital |
Capital reserve, granted options and treasury shares |
Earnings reserve |
Retained earnings/ (accumulated losses) |
Other comprehensive income |
Shareholders´ Equity |
5.01 |
Opening balances |
4,540,000 |
30 |
2.839.568 |
716,972 |
8,096,570 | |
5.03 |
Adjusted opening balances |
4,540,000 |
30 |
2.839.568 |
716,972 |
8,096,570 | |
5.04 |
Capital transactions with shareholders |
-425,000 |
-425,000 | ||||
5.04.06 |
Dividends |
-425,000 |
-425,000 | ||||
5.05 |
Total comprehensive income |
55,334 |
-470,811 |
-415,477 | |||
5.05.01 |
Profit for the period |
55,334 |
55,334 | ||||
5.05.02 |
Other comprehensive income |
-470,811 |
-470,811 | ||||
5.05.02.04 |
Translation adjustments for the period |
-44,326 |
-44,326 | ||||
5.05.02.07 |
Actuarial (losses) gains on defined benefit pension plan |
1,710 |
1,710 | ||||
5.05.02.08 |
Available-for-sale assets |
-428,195 |
-428,195 | ||||
5.07 |
Closing balances |
4,540,000 |
30 |
2,414,568 |
55,334 |
246,161 |
7,256,093 |
PAGE 8 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Parent Company Statements / Statement of Changes in Shareholders´ Equity - 1/1/2013 to 03/31/2013 |
| |||||||||||
(R$ thousand) |
| |||||||||||
Code |
Description |
Paid-in capital |
Capital reserve, granted options and treasury shares |
Earnings reserve |
Retained earnings/ (accumulated losses) |
Other comprehensive income |
Shareholders´ Equity | |||||
5.01 |
Opening balances |
4,540,000 |
30 |
3,690,543 |
386,324 |
8,616,897 | ||||||
5.03 |
Adjusted opening balances |
4,540,000 |
30 |
3,690,543 |
386,324 |
8,616,897 | ||||||
5.04 |
Capital transactions with shareholders |
-560,000 |
-560,000 | |||||||||
5.04.08 |
Approval of prior year’s proposed dividends |
-560,000 |
-560,000 | |||||||||
5.05 |
Total comprehensive income |
27,326 |
-297,983 |
-270,657 | ||||||||
5.05.01 |
Profit for the period |
27,326 |
27,326 | |||||||||
5.05.02 |
Other comprehensive income |
-297,983 |
-297,983 | |||||||||
5.05.02.04 |
Cumulative translation adjustments for the period |
-43,239 |
-43,239 | |||||||||
5.05.02.06 |
Available-for-sale financial assets, net of taxes |
-254,744 |
-254,744 | |||||||||
5.07 |
Closing balances |
4,540,000 |
30 |
3,130,543 |
27,326 |
88,341 |
7,786,240 | |||||
PAGE 9 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Parent Company Statements / Statement of Value Added |
|||
(R$ thousand) |
|||
Code |
Description |
YTD Current year |
YTD Previous year |
7.01 |
Revenues |
4,265,934 |
3,591,649 |
7.01.01 |
Sales of products and services |
4,217,900 |
3,540,704 |
7.01.02 |
Other revenues |
49,773 |
46,088 |
7.01.04 |
Allowance for (reversal of) doubtful debts |
-1,739 |
4,857 |
7.02 |
Raw materials acquired from third parties |
-2,601,607 |
-2,402,536 |
7.02.01 |
Costs of sales and services |
-2,198,768 |
-2,109,794 |
7.02.02 |
Materials, electric power, outside services and other |
-381,414 |
-292,742 |
7.02.03 |
Impairment/recovery of assets |
-21,425 |
0 |
7.03 |
Gross value added |
1,664,327 |
1,189,113 |
7.04 |
Retentions |
-234,661 |
-236,615 |
7.04.01 |
Depreciation, amortization and depletion |
-234,661 |
-236,615 |
7.05 |
Wealth created |
1,429,666 |
952,498 |
7.06 |
Value added received as transfer |
-292,728 |
-112,630 |
7.06.01 |
Share of profits of investees |
-291,125 |
-112,473 |
7.06.02 |
Finance income |
8,569 |
25,033 |
7.06.03 |
Other |
-10,172 |
-25,190 |
7.07 |
Wealth for distribution |
1,136,938 |
839,868 |
7.08 |
Wealth distributed |
1,136,938 |
839,868 |
7.08.01 |
Personnel |
291,687 |
250,808 |
7.08.01.01 |
Salaries and wages |
225,733 |
194,351 |
7.08.01.02 |
Benefits |
48,979 |
41,909 |
7.08.01.03 |
Severance pay fund (FGTS) |
16,975 |
14,548 |
7.08.02 |
Taxes, fees and contributions |
210,515 |
93,909 |
7.08.02.01 |
Federal |
182,960 |
55,623 |
7.08.02.02 |
State |
21,361 |
33,178 |
7.08.02.03 |
Municipal |
6,194 |
5,108 |
7.08.03 |
Lenders and lessors |
579,402 |
467,825 |
7.08.03.01 |
Interest |
901,650 |
606,310 |
7.08.03.02 |
Leases |
2,715 |
2,941 |
7.08.03.03 |
Other |
-324,963 |
-141,426 |
7.08.04 |
Shareholders |
55,334 |
27,326 |
7.08.04.03 |
Retained earnings (accumulated losses) for the period |
55,334 |
27,326 |
PAGE 10 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Consolidated Financial Statements / Balance Sheet - Assets |
|||||
(R$ thousand) |
|||||
Code |
Description |
Current Quarter |
YTD Previous Year | ||
1 |
Total assets |
49,861,822 |
50,402,539 | ||
1.01 |
Current assets |
16,067,724 |
16,402,042 | ||
1.01.01 |
Cash and cash equivalents |
10,000,372 |
9,995,672 | ||
1.01.03 |
Trade receivables |
1,705,710 |
2,522,465 | ||
1.01.04 |
Inventories |
3,401,759 |
3,160,985 | ||
1.01.08 |
Other current assets |
959,883 |
722,920 | ||
1.02 |
Non-current assets |
33,794,098 |
34,000,497 | ||
1.02.01 |
Long-term receivables |
4,514,337 |
4,636,608 | ||
1.02.01.02 |
Investments measured at amortized cost |
30,042 |
30,756 | ||
1.02.01.06 |
Deferred taxes |
3,079,049 |
2,770,527 | ||
1.02.01.09 |
Other non-current assets |
1,405,246 |
1,835,325 | ||
1.02.02 |
Investments |
13,417,079 |
13,487,023 | ||
1.02.03 |
Property, plant and equipment |
14,916,278 |
14,911,426 | ||
1.02.04 |
Intangible assets |
946,404 |
965,440 | ||
PAGE 11 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Consolidated Financial Statements / Balance Sheet - Liabilities |
|||
(R$ thousand) |
|||
Code |
Description |
Current Quarter |
YTD Previous Year |
2 |
Total liabilities |
49,861,822 |
50,402,539 |
2.01 |
Current liabilities |
6,704,889 |
5,564,230 |
2.01.01 |
Payroll and related taxes |
195,975 |
208,921 |
2.01.02 |
Trade payables |
1,340,116 |
1,102,037 |
2.01.03 |
Taxes payable |
285,870 |
304,095 |
2.01.04 |
Borrowings and financing |
3,460,711 |
2,642,807 |
2.01.05 |
Other payables |
1,044,887 |
972,851 |
2.01.06 |
Provisions |
377,330 |
333,519 |
2.01.06.01 |
Provision for tax, social security, labor and civil risks |
377,330 |
333,519 |
2.02 |
Non-current liabilities |
35,931,589 |
36,769,250 |
2.02.01 |
Borrowings and financing |
24,159,594 |
25,103,623 |
2.02.02 |
Other payables |
10,163,727 |
10,061,571 |
2.02.03 |
Deferred taxes |
253,767 |
268,833 |
2.02.04 |
Provisions |
1,354,501 |
1,335,223 |
2.02.04.01 |
Provision for tax, social security, labor and civil risks |
510,171 |
479,664 |
2.02.04.02 |
Other provisions |
844,330 |
855,559 |
2.02.04.02.03 |
Provision for environmental liabilities and Asset retirement obligation |
359,225 |
370,454 |
2.02.04.02.04 |
Pension and healthcare plan |
485,105 |
485,105 |
2.03 |
Shareholders’ equity |
7,225,344 |
8,069,059 |
2.03.01 |
Issued capital |
4,540,000 |
4,540,000 |
2.03.02 |
Capital reserves |
30 |
30 |
2.03.04 |
Earnings reserves |
2,414,568 |
2,839,568 |
2.03.04.01 |
Legal reserve |
361,641 |
361,641 |
2.03.04.02 |
Statutory reserve |
2,052,927 |
2,477,927 |
2.03.05 |
Retained earnings/Accumulated losses |
55,334 |
- |
2.03.08 |
Other comprehensive income |
246,161 |
716,972 |
2.03.09 |
Non-controlling interests |
-30,749 |
-27,511 |
PAGE 12 of 70
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Version: 1 |
Consolidated Financial Statements / Statements of Income |
|||
(R$ thousand) |
|||
Code |
Description |
Current Quarter |
YTD PreviousYear |
3.01 |
Net revenue from sales and/or services |
4,370,878 |
3,641,983 |
3.02 |
Cost of sales and/or services |
-3,034,529 |
-2,851,577 |
3.03 |
Gross profit |
1,336,349 |
790,406 |
3.04 |
Operating expenses/income |
-515,899 |
-388,785 |
3.04.01 |
Selling expenses |
-189,915 |
-201,250 |
3.04.02 |
General and administrative expenses |
-103,853 |
-109,586 |
3.04.04 |
Other operating income |
7,713 |
4,256 |
3.04.05 |
Other operating expenses |
-184,341 |
-98,900 |
3.04.06 |
Share of profits of investees |
-45,503 |
16,695 |
3.05 |
Profit before finance income (costs) and taxes |
820,450 |
401,621 |
3.06 |
Finance income (costs) |
-741,199 |
-527,283 |
3.06.01 |
Finance income |
38,052 |
37,820 |
3.06.02 |
Finance costs |
-779,251 |
-565,103 |
3.06.02.01 |
Net exchange losses on financial instruments |
-55,216 |
-28,685 |
3.06.02.02 |
Finance costs |
-724,035 |
-536,418 |
3.07 |
Profit (loss) before taxes on income |
79,251 |
-125,662 |
3.08 |
Income tax and social contribution |
-27,155 |
141,978 |
3.09 |
Profit from continuing operations |
52,096 |
16,316 |
3.11 |
Consolidated profit for the period |
52,096 |
16,316 |
3.11.01 |
Attributed to owners of the Company |
55,334 |
27,326 |
3.11.02 |
Attributed to non-controlling interests |
-3,238 |
-11,010 |
3.99 |
Earnings per share - (R$/share) |
||
3.99.01 |
Basic earnings per share |
||
3.99.01.01 |
Common shares |
0.03796 |
0.01874 |
3.99.02 |
Diluted earnings per share |
||
3.99.02.01 |
Common shares |
0.03796 |
0.01874 |
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Version: 1 |
Consolidated Financial Statements / Statement of Comprehensive Income | |||
(R$ thousand) |
|||
Code |
Description |
Current Quarter |
YTD Previous Year |
4.01 |
Consolidated profit for the period |
52,096 |
16,316 |
4.02 |
Other comprehensive income |
-470,811 |
-297,983 |
4.02.01 |
Cumulative translation adjustments for the period |
-44,326 |
-43,239 |
4.02.02 |
Actuarial (losses) gains on defined benefit pension plan |
1,710 |
0 |
4.02.04 |
Available-for-sale assets |
-648,780 |
-385,976 |
4.02.05 |
Income tax and social contribution on available-for-sale assets |
220,585 |
131,232 |
4.03 |
Consolidated comprehensive income for the period |
-418,715 |
-281,667 |
4.03.01 |
Attributed to owners of the Company |
-415,477 |
-270,657 |
4.03.02 |
Attributed to non-controlling interests |
-3,238 |
-11,010 |
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Version: 1 |
Consolidated Financial Statements / Statement of Cash Flows – Indirect Method | |||
(R$ thousand) |
|||
Code |
Description |
YTD Current Year |
YTD Previous Year |
6.01 |
Net cash generated by operating activities |
576,219 |
-213,878 |
6.01.01 |
Cash generated from operations |
1,121,670 |
491,236 |
6.01.01.01 |
Profit for the period attributable to owners of the Company |
55,334 |
27,326 |
6.01.01.02 |
Profit (loss) for the period attributable to non-controlling interests |
-3,238 |
-11,010 |
6.01.01.03 |
Charges on borrowings and financing |
656,367 |
479,972 |
6.01.01.04 |
Charges on loans and financing granted |
-8,850 |
0 |
6.01.01.05 |
Depreciation, depletion and amortization |
294,406 |
294,273 |
6.01.01.06 |
Share of profits (losses) of investees |
45,503 |
-16,695 |
6.01.01.07 |
Deferred income tax and social contribution |
-96,856 |
-219,813 |
6.01.01.08 |
Provision for tax, social security, labor, civil and environmental risks |
63,089 |
24,125 |
6.01.01.09 |
Monetary variation and exchange differences, net |
68,703 |
-144,000 |
6.01.01.10 |
Gain on derivative transactions |
3,069 |
2,363 |
6.01.01.12 |
Residual value of permanent assets written off |
4,628 |
1,832 |
6.01.01.13 |
Other provisions |
39,515 |
52,863 |
6.01.02 |
Changes in assets and liabilities |
-545,451 |
-705,114 |
6.01.02.01 |
Trade receivables - third parties |
114,057 |
29,291 |
6.01.02.02 |
Trade receivables - related parties |
-62,335 |
71,741 |
6.01.02.03 |
Inventories |
-220,191 |
-114,993 |
6.01.02.04 |
Receivables from related parties |
-17,124 |
89,316 |
6.01.02.05 |
Recoverable taxes |
16,329 |
-19,924 |
6.01.02.06 |
Judicial deposits |
-2,633 |
7,624 |
6.01.02.07 |
Dividends received from related parties |
202,015 |
0 |
6.01.02.08 |
Trade payables |
210,719 |
-224,050 |
6.01.02.09 |
Payroll and related taxes |
19,989 |
36,962 |
6.01.02.10 |
Taxes in installments - REFIS |
-64,240 |
-36,474 |
6.01.02.11 |
Payables to related parties |
-155 |
-1,232 |
6.01.02.12 |
Interest paid |
-731,334 |
-511,146 |
6.01.02.13 |
Interest received - related parties |
13,563 |
0 |
6.01.02.14 |
Interest on swaps paid |
-633 |
-1,219 |
6.01.02.15 |
Other |
-23,478 |
-31,010 |
6.02 |
Net cash used in investing activities |
-135,745 |
-234,950 |
6.02.01 |
Investments |
-5,846 |
0 |
6.02.02 |
Purchase of property, plant and equipment |
-298,490 |
-440,442 |
6.02.04 |
Receipt/payment in derivative transactions |
3,879 |
207,417 |
6.02.06 |
Purchase of intangible assets |
-257 |
-30 |
6.02.07 |
Related parties loans |
-3,860 |
0 |
6.02.08 |
Receipt of related parties loans |
168,115 |
0 |
6.02.09 |
Investment, net of redeemed amount |
714 |
-1,895 |
6.03 |
Net cash used in financing activities |
-104,988 |
-49,453 |
6.03.01 |
Borrowings and financing raised |
934,146 |
349,329 |
6.03.02 |
Repayment of borrowings |
-614,264 |
-104,264 |
6.03.04 |
Dividends and interest on capital paid |
-424,870 |
-299,942 |
6.03.05 |
Capital contribution by non-controlling shareholders |
0 |
5,424 |
6.04 |
Exchange differences on translating cash and cash equivalents |
-330,786 |
-61,401 |
6.05 |
Increase (decrease) in cash and cash equivalents |
4,700 |
-559,682 |
6.05.01 |
Cash and equivalents at the beginning of the period |
9,995,672 |
11,891,821 |
6.05.02 |
Cash and equivalents at the end of the period |
10,000,372 |
11,332,139 |
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Version: 1 |
Consolidated Financial Statements / Statement of Changes in Shareholders´ Equity - 1/1/2014 to 03/31/2014 | |||||||||
(R$ thousand) |
|||||||||
Code |
Description |
Paid-in capital |
Capital reserve, granted options and treasury shares |
Earnings reserve |
Retained earnings/ (accumulated losses) |
Other comprehensive income |
Shareholders´ Equity |
Non-controlling interests |
Consolidated shareholders' equity |
5.01 |
Opening balances |
4,540,000 |
30 |
2,839,568 |
716,972 |
8,096,570 |
-27,511 |
8,069,059 | |
5.03 |
Adjusted opening balances |
4,540,000 |
30 |
2,839,568 |
716,972 |
8,096,570 |
-27,511 |
8,069,059 | |
5.04 |
Capital transactions with shareholders |
-425,000 |
-425,000 |
-425,000 | |||||
5.04.06 |
Dividends |
-425,000 |
-425,000 |
-425,000 | |||||
5.05 |
Total comprehensive income |
55,334 |
-470,811 |
-415,477 |
-3,238 |
-418,715 | |||
5.05.01 |
Profit for the period |
55,334 |
55,334 |
-3,238 |
52,096 | ||||
5.05.02 |
Other comprehensive income |
-470,811 |
-470,811 |
-470,811 | |||||
5.05.02.04 |
Translation adjustments for the period |
-44,326 |
-44,326 |
-44,326 | |||||
5.05.02.07 |
Actuarial (losses) gains on defined benefit pension plan |
1,710 |
1,710 |
1,710 | |||||
5.05.02.08 |
Available-for-sale assets, net of taxes |
-428,195 |
-428,195 |
-428,195 | |||||
5.07 |
Closing balances |
4,540,000 |
30 |
2,414,568 |
55,334 |
246,161 |
7,256,093 |
-30,749 |
7,225,344 |
PAGE 16 of 70
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Version: 1 |
Consolidated Financial Statements / Statement of Changes in Shareholders´ Equity - 1/1/2013 to 03/31/2013 | |||||||||
(R$ thousand) |
|||||||||
Code |
Description |
Paid-in capital |
Capital reserve, granted options and treasury shares |
Earnings reserve |
Retained earnings/ (accumulated losses) |
Other comprehensive income |
Shareholders´ Equity |
Non-controlling interests |
Consolidated shareholders' equity |
5.01 |
Opening balances |
4,540,000 |
30 |
3,690,543 |
386,324 |
8,616,897 |
390,616 |
9,007,513 | |
5.03 |
Adjusted opening balances |
4,540,000 |
30 |
3,690,543 |
386,324 |
8,616,897 |
390,616 |
9,007,513 | |
5.04 |
Capital transactions with shareholders |
-560,000 |
-560,000 |
-560,000 | |||||
5.04.08 |
Approval of prior year’s proposed dividends |
-560,000 |
-560,000 |
-560,000 | |||||
5.05 |
Total comprehensive income |
27,326 |
-297,983 |
-270,657 |
-11,010 |
-281,667 | |||
5.05.01 |
Profit for the period |
27,326 |
27,236 |
-11,010 |
16,316 | ||||
5.05.02 |
Other comprehensive income |
-297,983 |
-297,983 |
-297,983 | |||||
5.05.02.04 |
Cumulative translation adjustments for the period |
-43,239 |
-43,239 |
-43,239 | |||||
5.05.02.06 |
Available-for-sale financial assets, net of taxes |
-254,744 |
-254,744 |
-254,744 | |||||
5.06 |
Internal changes in shareholders' equity |
5,351 |
5,351 | ||||||
5.06.04 |
Non-controlling interests in subsidiaries |
5,351 |
5,351 | ||||||
5.07 |
Closing balances |
4,540,000 |
30 |
3,130,543 |
27,326 |
88,341 |
7,786,240 |
384,957 |
8,171,197 |
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Consolidated Financial Statements / Statement of Value Added | |||
(R$ thousand) |
|||
Code |
Description |
YTD Current year |
YTD Previous year |
7.01 |
Revenues |
5,236,997 |
4,451,468 |
7.01.01 |
Sales of products and services |
5,189,439 |
4,401,707 |
7.01.02 |
Other revenues |
49,906 |
44,918 |
7.01.04 |
Allowance for (reversal of) doubtful debts |
-2,348 |
4,843 |
7.02 |
Raw materials acquired from third parties |
-3,309,802 |
-3,011,736 |
7.02.01 |
Costs of sales and services |
-2,805,092 |
-2,589,917 |
7.02.02 |
Materials, electric power, outside services and other |
-481,519 |
-421,940 |
7.02.03 |
Impairment/recovery of assets |
-23,191 |
121 |
7.03 |
Gross value added |
1,927,195 |
1,439,732 |
7.04 |
Retentions |
-294,406 |
-294,273 |
7.04.01 |
Depreciation, amortization and depletion |
-294,406 |
-294,273 |
7.05 |
Wealth created |
1,632,789 |
1,145,459 |
7.06 |
Value added received as transfer |
-942,712 |
-512,269 |
7.06.01 |
Share of profits of investees |
-45,503 |
16,695 |
7.06.02 |
Finance income |
38,052 |
37,820 |
7.06.03 |
Other |
-935,261 |
-566,784 |
7.07 |
Wealth for distribution |
690,077 |
633,190 |
7.08 |
Wealth distributed |
690,077 |
633,190 |
7.08.01 |
Personnel |
393,796 |
357,754 |
7.08.01.01 |
Salaries and wages |
311,928 |
285,134 |
7.08.01.02 |
Benefits |
62,032 |
54,543 |
7.08.01.03 |
Severance pay fund (FGTS) |
19,836 |
18,077 |
7.08.02 |
Taxes, fees and contributions |
396,581 |
256,837 |
7.08.02.01 |
Federal |
340,944 |
161,528 |
7.08.02.02 |
State |
45,731 |
87,225 |
7.08.02.03 |
Municipal |
9,906 |
8,084 |
7.08.03 |
Lenders and lessors |
-152,396 |
2,283 |
7.08.03.01 |
Interest |
814,965 |
528,004 |
7.08.03.02 |
Leases |
4,159 |
4,159 |
7.08.03.03 |
Other |
-971,520 |
-529,880 |
7.08.04 |
Shareholders |
52,096 |
16,316 |
7.08.04.03 |
Retained earnings (accumulated losses) for the period |
55,334 |
27,326 |
7.08.04.04 |
Non-controlling interests in retained earnings |
-3,238 |
-11,010 |
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Global growth has been consolidating, fueled by the recovery of the developed economies, while growth in the emerging nations is expected to be moderate. The global Purchasing Managers Index (PMI) closed March at 53.5 points, giving 18 consecutive months of expansion. In this scenario, the IMF expects global GDP growth of 3.6% this year and 3.9% in 2015, versus 3.0% in 2013.
USA
In the United States, even though the economic performance of the first two months of the year was jeopardized by the exceptionally rigorous winter, the fundamentals are still favoring a recovery in activity. March’s manufacturing PMI recorded 53.7 points, while the service sector PMI reached 55.3 points, up by 0.5 and 2.0 points, respectively, on February.
Industrial production moved up by 0.7% in March, giving 12-month growth of 3.8%, while capacity use came to 79.2%, higher than the 78.4% recorded in December 2013.
Unemployment reached 6.7% in March, flat over December 2013 and 0.8 p.p. down in the last 12 months.
The FED maintained its US$10 billion reduction in the asset purchase program at each meeting and will continue to do so, unless there is a significant change in the economic fundamentals. At the same time, it signaled that the current interest rates would remain in place for a longer period, even after the winding up of the asset purchase program, expected at the end of 2014, thereby alleviating market concerns. The FED expects U.S. GDP growth of between 2.8% and 3.0% in 2014.
Europe
Despite the 0.4% economic shrinkage in the Eurozone in 2013, the European Central Bank (ECB) expects growth of 1.2% in 2014 and 1.5% in 2015, albeit not uniformly among the various countries.
The Eurozone’s compound PMI reached 53.1 points in March, 1.0 point up on December 2013 and the ninth consecutive monthly upturn. Unemployment, stable since October, fell slightly in March, reaching 11.8%, while industrial production increased by 1.7% in February over the month before.
Twelve-month inflation closed March at 1.1%, below the 2% target established by the ECB. As a result, at its last meeting in April, the institution maintained interest rates at 0.25% p.a., their lowest ever level.
In the UK, first-quarter GDP edged up by 0.8%, fueled by the service sector. Industrial output grew by 0.9% in February over January, while compound PMI reached 58.1 points in the same month, slightly down on the 59.5 points recorded in December, but still high. According to the British Treasury, the consensus of estimates points to GDP growth of 2.8% in 2014.
Asia
In China, the beginning-of-year activity indicators pointed to deceleration, once again raising worries of a possible economic slowdown.
Preliminary 1Q14 figures indicate year-on-year Chinese GDP growth of 7.4%. Industrial production moved up by 8.7% in the first quarter, below the average of 10% recorded in the second half of 2013. Manufacturing PMI, disclosed by HSBC, which expanded by 50.5 points in December 2013, has been on the decline since the beginning of this year, reaching 48.0 points in March, while investments in fixed assets fell from 20.9% in 1Q13 to 17.6% in 1Q14.
According to the Chinese National Bureau of Statistics, total investments in the construction sector came to 1.5 billion yuan in 1Q14, 16.8% up in the quarter, versus 20.2% in 1Q13, signifying a decline of 3.4 p.p.
Given this scenario, in April the Chinese government announced a series of measures to stimulate the economy, including tax breaks for small and mid-sized businesses, accelerated railway construction and improvements to the housing financing system. The government maintained its 2014 GDP growth target at 7.5%, with industrial output growth of 9.5%.
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Japan continued to stage a modest recovery, with the local central bank maintaining its economic stimuli. Manufacturing PMI reached 53.9 points in March, the tenth consecutive monthly expansion, versus 55.2 points in December 2013. The institution expects 2014 GDP growth of between 0.9% and 1.5%, with inflation of 1.5%.
Brazil
On the home front, February’s seasonally-adjusted Central Bank Economic Activity Index (IBC-Br), used as a reference for GDP, increased by 0.24% over January, giving a 12-month variation of 2.41%. The Central Bank’s FOCUS report expects GDP growth of 1.63% in 2014 and 1.91% in 2015.
Industrial production in February edged up by 0.4% over the previous month and by 5.0% year-on-year. Retail sales increased by 0.2% in February over January and by 5.0% in the previous 12 months.
On the other hand, the Industrial Confidence Index (ICI) measured by the Getulio Vargas Foundation fell by 2.3% between February and March 2014, from 98.5 to 96.2 points, the lowest level since June 2009.The trade balance closed 1Q14 with a deficit of US$6.1 billion, the worst figure since the series began in 1994.
Inflation measured by the IPCA consumer price index increased by 0.92% in March over February and by 6.15% in 12 months, above the mid-point of the inflationary target defined by the Monetary Policy Committee (COPOM). As a result, the COPOM maintained its restrictive monetary policy, raising the Selic benchmark interest rate for the ninth consecutive time, this time to 11.25% p.a. The FOCUS report expects 2014 inflation of 6.5%, with a Selic of 11.25% at year-end.
On the foreign exchange front, the real appreciated by 3.4% against the dollar in 1Q14, closing March at R$2.263, reflecting the current yields of U.S. government bonds and the increase in Brazilian interest rates.
Macroeconomic Projections
|
2014 |
2015 |
IPCA (%) |
6.50 |
6.00 |
Commercial dollar (final) – R$ |
2.45 |
2.51 |
SELIC (final - %) |
11.25 |
12.25 |
GDP (%) |
1.63 |
1.91 |
Industrial Production (%) |
1.21 |
2.65 |
Source: FOCUS BACEN Base: May 5, 2014
CSN recorded consolidated net revenue of R$4,371 million in 1Q14, 20% up on the R$3,642 million reported in 1Q13, chiefly due to increased revenue from steel and mining operations.
In relation to the R$4,949 million recorded in 4Q13, 1Q14 net revenue fell by 12%, primarily due to reduced revenue from the mining segment.
In 1Q14, consolidated COGS came to R$3,035 million, 6% more than the R$2,852 million posted in the same period last year, basically due to higher iron ore sales volume.
In comparison to the R$3,292 million recorded in 4Q13, 1Q14 COGS declined by 8%, mainly due to lower iron ore sales volume.
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SG&A expenses totaled R$294 million in 1Q14, 5% down on the R$311 million posted in 1Q13, chiefly due to the lower distribution cost, and 17% down on the R$355 million reported in 4Q13, mainly as a result of the reduction in administrative expenses.
In 1Q14, Other Operating Revenue/Expenses amounted to R$177 million, 86% up on the R$95 million recorded in 1Q13, due to provisions for contingencies, and 10% down on the R$196 million reported in 4Q13, essentially basically due to the non-recurring impact of the Company’s adherence to the Tax Settlement Program (REFIS) in the latter quarter.
Adjusted EBITDA totaled R$1,440 million in 1Q14, 60% up on the R$902 million recorded in 1Q13, essentially due to the contributions of the steel and mining segments, while the EBITDA margin came to 30%. In relation to 4Q13, adjusted EBITDA fell by 18%, chiefly due to the mining segment, partially offset by steel EBITDA, while the adjusted EBITDA margin narrowed by 2 p.p.
The Company uses Adjusted EBITDA to measure the segments' performance and operating cash flow capacity. It comprises net income, less net financial result, income and social contribution taxes, depreciation and amortization, results from investees and other operating revenue (expenses), plus the proportional EBITDA of the jointly-owned subsidiaries, Namisa, MRS Logística and CBSI.
The 1Q14 net financial result was negative by R$741 million, primarily due to the following factors:
· Interest on loans and financing totaling R$659 million;
· Expenses of R$41 million with the monetary restatement of tax payment installments;
· Other financial expenses totaling R$24 million;
· Monetary and foreign exchange variations amounting to R$55 million;
These negative effects were partially offset by consolidated financial revenue of R$38 million.
Gross debt, net debt and the net debt/EBITDA ratio presented below reflect the Company’s proportional interest in Namisa, MRS Logística and CBSI, as well as the impact from the partial spin-off of Transnordestina Logística S/A.
On March 31, 2014, consolidated net debt totaled R$15.8 billion, very close to the R$15.7 million recorded on December 31, 2013, impacted by:
· Payment of dividends and interest on equity totaling R$0.4 billion;
· Investments of R$0.3 billion in fixed assets;
· A R$0.7 billion effect related to the cost of debt;
· Other effects totaling R$0.1 billion;
These negative impacts were offset by 1Q14 EBITDA of R$1.4 billion.
The net debt/EBITDA ratio based on LTM adjusted EBITDA closed the first quarter at 2.66x, 0.25x down on the ratio recorded at the end of 4Q13.
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Indebtedness (R$ million) and Net Debt /Adjusted EBITDA ratio
The consolidated equity result was negative by R$46 million in 1Q14, essentially due to the results of the jointly-owned subsidiaries Namisa and MRS.
CSN posted consolidated net income of R$52 million in 1Q14, R$36 million more than in 1Q13, chiefly due to the upturn in gross profit.
In comparison with the previous quarter, net income increased by R$539 million, given the 4Q13 net loss of R$487 million, primarily due to the Company’s adherence to the Tax Settlement Program (REFIS).
Investments reflect the Company’s proportional interest in Namisa, MRS Logística and CBSI. The Company has ceased consolidating its interest in Transnordestina Logística S/A, due to the latter’s partial spin-off on December 27, 2013 and the consequent entry into effect of the new shareholders’ agreement.
CSN invested R$355 million in 1Q14, R$236 million in the parent company. Of this total, R$114 million went to the Casa de Pedra mine and the Port of Itaguaí and R$108 million to the steel segment, mainly due to improvements to the hot strip mill (LTQ) and the coke batteries.
The remaining R$119 million went to subsidiaries or joint subsidiaries, mostly as follows:
ü Namisa: R$33 million;
ü Sepetiba Tecon: R$28 million;
ü MRS: R$23 million.
Working capital allocated to the Company’s businesses closed 1Q14 at R$2,510 million, R$25 million less than at the end of 4Q13, chiefly due to the increase in the suppliers line and the reduction in accounts receivable, partially offset by the upturn in inventories. The average supplier payment period widened by nine days, the average receivables period narrowed by two days and the average inventory turnover period increased by twelve days.
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WORKING CAPITAL (R$ MM) | 1Q13 | 4Q13 | 1Q14 | Change 1Q14 x 1Q13 |
Change 1Q14 x 4Q13 |
Assets | 4,100 | 3,951 | 4,126 | 26 | 175 |
Accounts Receivable | 1,506 | 1,734 | 1,621 | 115 | (112) |
Inventory (*) | 2,583 | 2,164 | 2,416 | (167) | 252 |
Advances to Taxes | 12 | 54 | 89 | 77 | 35 |
Liabilities | 2,435 | 1,416 | 1,616 | (819) | 200 |
Suppliers | 1,881 | 881 | 1,105 | (776) | 223 |
Salaries and Social Contribution | 192 | 209 | 196 | 4 | (13) |
Taxes Payable | 332 | 297 | 286 | (46) | (12) |
Advances from Clients | 30 | 28 | 30 | 0 | 2 |
Working Capital | 1,666 | 2,535 | 2,510 | 844 | (25) |
TURNOVER RATIO Average Periods |
1Q13 | 4Q13 | 1Q14 | Change 1Q14 x 1Q13 |
Change 1Q14 x 4Q13 |
Receivables | 30 | 30 | 28 | (2) | (2) |
Supplier Payment | 59 | 26 | 35 | (24) | 9 |
Inventory Turnover | 82 | 64 | 76 | (6) | 12 |
Cash Conversion Cycle | 53 | 68 | 69 | 16 | 1 |
(*) Inventory - includes "Advances to Suppliers" and does not include "Supplies". |
The Company maintains integrated operations in five business segments: steel, mining, logistics, cement and energy. The main assets and/or companies comprising each segment are presented below:
The information on CSN’s five business segments is derived from the accounting data, together with allocations and the apportionment of costs among the segments. Results by segment reflect the Company’s proportional interest in Namisa, MRS Logística and CBSI, as well as the full consolidation of FTL.
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Results by Segments | ||||||||
R$ million | 1Q14 | |||||||
Consolidated Results | Steel | Mining | Logistics (Port) |
Logistics (Railways) |
Energy | Cement | Corporate/ Eliminations |
Consolidated |
Net Revenue | 3,127 | 1,247 | 60 | 277 | 65 | 98 | (504) | 4,371 |
Domestic Market |
2,355 | 100 | 60 | 277 | 65 | 98 | (250) | 2,706 |
Foreign Market |
771 | 1,148 | - | - | - | - | (254) | 1,665 |
Cost of Goods Sold | (2,395) | (716) | (34) | (205) | (42) | (65) | 423 | (3,035) |
Gross Profit | 732 | 531 | 26 | 72 | 23 | 33 | (82) | 1,336 |
Selling, General and Administrative Expenses | (166) | (16) | (1) | (28) | (5) | (15) | (64) | (294) |
Depreciation | 195 | 70 | 2 | 39 | 4 | 9 | (33) | 285 |
Proportional EBITDA of Jointly Controlled Companies | 112 | 112 | ||||||
Adjusted EBITDA | 761 | 585 | 27 | 83 | 23 | 27 | (66) | 1,440 |
R$ million | 1Q13 | |||||||
Consolidated Results | Steel | Mining | Logistics (Port) | Logistics (Railways) |
Energy | Cement | Corporate/ Eliminations |
Consolidated |
Net Revenue | 2,947 | 747 | 39 | 225 | 47 | 98 | (461) | 3,642 |
Domestic Market |
2,313 | 87 | 39 | 225 | 47 | 98 | (218) | 2,592 |
Foreign Market |
634 | 659 | - | - | - | - | (243) | 1,050 |
Cost of Goods Sold | (2,456) | (454) | (21) | (171) | (41) | (67) | 358 | (2,852) |
Gross Profit | 492 | 293 | 19 | 55 | 6 | 30 | (103) | 790 |
Selling, General and Administrative Expenses | (158) | (17) | (6) | (22) | (5) | (14) | (89) | (311) |
Depreciation | 194 | 51 | 2 | 31 | 4 | 7 | (2) | 287 |
Adjusted EBITDA | - | - | 135 | 135 | ||||
Adjusted EBITDA | 528 | 326 | 15 | 63 | 5 | 24 | (59) | 902 |
Scenario
According to the World Steel Association (WSA) global crude steel production totaled 406 million tonnes in 1Q14, 2.5% higher than in 1Q13, with China, responsible for 203 million tonnes, recording growth of 2.4%. Global capacity use reached 79% in March, 6.2 p.p. up on December 2013. The WSA expects global apparent steel consumption to grow by 3.1% in 2014, with apparent consumption in China moving up by 3%.
According to the Brazilian Steel Institute (IABr), domestic crude steel production came to 8.3 million tonnes in 1Q14, 1.5% more than in 1Q13, while rolled flat output totaled 6.3 million tonnes, up by 1.9%.
Apparent domestic flat steel consumption amounted to 6.4 million tonnes in the first quarter, 2.1% more than in 1Q13, while domestic sales moved up by 1.7% to 5.4 million tonnes. On the other hand, imports climbed by 3.8% to 0.9 million tonnes, while exports fell by 19% to 1.9 million tonnes.
The IABr estimates domestic sales of 23.7 million tonnes in 2014, with apparent consumption of 27.2 million tonnes.
Automotive
According to ANFAVEA (the Auto Manufacturers’ Association), light vehicle production totaled 790,000 units in 1Q14, 8.4% down on 1Q13, with sales of 813,000 units, down by 2.1%.
ANFAVEA estimates light vehicle production and sales growth of 1.4% and 1.1%, respectively, in 2014, while FENABRAVE (the Vehicle Distributors’ Association) expects sales to remain flat over last year.
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Construction
According to ABRAMAT (the Construction Material Manufacturers’ Association), sales of building materials increased by 0.9% year-on-year in 1Q14.
ABRAMAT estimates sales growth of 4.5% in 2014 as a whole, sustained by the resumption of investments in infrastructure and the works for the upcoming sporting events.
Home Appliances
According to the IBGE (Brazilian Institute of Geography and Statistics), home appliance production fell by 2.4% year-on-year in January and February.
Distribution
According to INDA (the Brazilian Steel Distributors’ Association), domestic flat steel sales by distributors totaled 1.17 million tonnes in 1Q14, 12% up on 4Q13. For 2014 as a whole, the association expects growth of 4% in flat steel sales by its affiliates.
Purchases by the associated network came to 1.09 million tonnes in 1Q14, 0.9% down on the previous three months. On the other hand, inventories closed March at 968,000 tonnes, 0.8% less than in 4Q13, representing 2.6 months of sales.
Sales Volume
CSN sold 1.39 million tonnes of steel in 1Q14, 4% down on 4Q13. Of this total, 73% went to the domestic market, 25% were sold by overseas subsidiaries and 2% went to direct exports.
Domestic Sales Volume
Domestic steel sales totaled 1.01 million tonnes in 1Q14, 5% less than in 4Q13, due to the seasonality of steel sales.
Foreign Sales Volume
Foreign steel sales amounted to 377,000 tonnes in 1Q14, in line with the previous quarter. Of this total, the overseas subsidiaries sold 351,000 tonnes, 209,000 of which by SWT. Direct exports came to 26,000 tonnes.
Prices
Net revenue per tonne averaged R$2,216 in 1Q14, 6% higher than the 4Q13 average.
Net Revenue
Net revenue from steel operations totaled R$3,127 million, 1% up on 4Q13, chiefly due to higher prices, partially offset by the decline in sales volume.
Cost of Goods Sold (COGS)
Steel segment COGS came to R$2,395 million, 2% less than in 1Q13 and 4Q13, basically due to lower sales volume.
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Adjusted EBITDA
Adjusted steel segment EBITDA totaled R$761 million in 1Q14, 20% up on the quarter before, basically due to higher steel prices and the largest quarterly figure since 3Q10. The adjusted EBITDA margin came to 24%, 3 p.p. up on 4Q13, and the highest since 3Q11. These results signify a steel segment margin recovery.
Production
The Presidente Vargas Steelworks (UPV) produced 1.1 million tonnes of crude steel in 1Q14, in line with the 4Q13 figure, while consumption of slabs purchased from third parties totaled 102,000 tonnes. Production of rolled steel came to 1.1 million tonnes, 8% down on the previous quarter due to the hot strip mill maintenance program.
Change | |||||
Production (in thousand t) | 1Q13 | 4Q13 | 1Q14 | 1Q14 x 1Q13 | 1Q14 x 4Q13 |
Crude Steel (P. Vargas Mill) | 1,047 | 1,093 | 1,098 | 5% | 0% |
Purchased Slabs from Third Parties |
118 | 179 | 102 | -14% | -43% |
Total Crude Steel | 1,165 | 1,271 | 1,200 | 3% | -6% |
Total Rolled Products | 1,089 | 1,141 | 1,053 | -3% | -8% |
Production Costs (Parent Company)
In 1Q14, the Presidente Vargas Steelworks’ total production costs came to R$1,656 million, 7% down on 4Q13, chiefly due to the reduced consumption of slabs acquired from third parties.
Scenario
In 1Q14, the seaborne iron ore market was negatively impacted by the slowdown in industrial output, the reduction in investments in fixed assets and lower real estate sales in China, which led to a deceleration in steel production. In addition, iron ore stocks in the main Chinese ports reached record levels, putting downward pressure on prices.
In this scenario, the Platts Fe62% CFR China index averaged US$120.38/dmt in 1Q14, 10.6% down on the 4Q13 average. The iron ore quality premium varied between US$2.00 and US$2.30/dmt per 1% of Fe content, while freight costs on the Tubarão/Qingdao route averaged US$22.33/wmt, 10.7% less than the previous quarter’s average, with the seasonal reduction in exports from Brazil and Australia.
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Brazil exported 77 million tonnes of iron ore in the first quarter, 19% down on 4Q13.
Iron Ore Sales
In 1Q14, sales of finished iron ore products totaled 6.4 million tonnes, 54% up on the 4.1 million tonnes sold in 1Q13 and 18% less than the 7.8 million tonnes recorded in the previous quarter, due to maintenance at the Tecar terminal in the Port of Itaguaí. Of this total, 2.2 million tonnes were sold by Namisa1. Virtually all iron ore sold in 1Q14 was exported.
Iron ore volume for own consumption reached 1.5 million tonnes in 1Q14.
1 Sales volumes include 100% of the stake in NAMISA.
Net Revenue
Net revenue from mining operations came to R$1,247 million in 1Q14, 67% up on 1Q13, primarily due to the upturn in sales volume.
In relation to the R$1,920 million reported in the previous quarter, however, 1Q14 net revenue fell by 35%, due to lower sales volume and prices and the 4Q13 reception of R$323 million in indemnification for lost earnings in 2007 due to a claim related to Tecar’s iron ore separator and belt transportation system.
Cost of Goods Sold (COGS)
COGS totaled R$716 million in 1Q14, 58% up on 1Q13, chiefly due to higher sales volume.
In relation to the R$946 million recorded in 4Q13, 1Q14 COGS fell by 24%, essentially due to lower sales volume.
Adjusted EBITDA
Adjusted EBITDA from mining operations totaled R$585 million in 1Q14, 79% up on the R$326 million reported in 1Q13, for the reasons mentioned above, with an adjusted EBITDA margin of 47%, and 43% down on the R$1,022 million recorded in 4Q13.
Scenario
Railway Logistics
According to the ANTT (National Ground Transport Association), the Brazilian railways transported 463 million tonnes in 2013, 0.7% up on 2012.
Port Logistics
According to ANTAQ (National Waterway Transport Agency), Brazil’s port installations handled around 931 million tonnes in 2013, 3% more than the year before. Bulk solids totaled 569 million tonnes, 2% up on 2012, while container handling came to 8.9 million TEUs1, up by 9%.
1 TEU (Twenty‐Foot Equivalent Unit) – transportation unit equivalent to a standard 20-feet intermodal container
Analysis of Results
Railway Logistics
Net revenue from railway logistics totaled R$277 million in 1Q14, COGS came to R$205 million and adjusted EBITDA amounted to R$83 million, with an adjusted EBITDA margin of 30%.
Port Logistics
In 1Q14, net revenue from port logistics amounted to R$60 million, COGS totaled R$34 million and adjusted EBITDA came to R$27 million, with an adjusted EBITDA margin of 46%.
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Scenario
Preliminary figures from SNIC (the Cement Industry Association) indicate domestic cement sales of 17.1 million tonnes in 1Q14, 6% up on the previous quarter.
Analysis of Results
Cement sales totaled 488,000 tonnes in 1Q14, generating net revenue of R$98 million. COGS amounted to R$65 million, while adjusted EBITDA reached R$27 million, with an adjusted EBITDA margin of 27%.
Scenario
According to the Energy Research Company (EPE), Brazilian electricity consumption increased by 6.0% year-on-year in the first quarter of 2014, led by the commercial and residential segments, with respective growth of 10.8% and 10.0%.
Analysis of Results
In the first quarter, net revenue came to R$65 million, COGS totaled R$42 million and adjusted EBITDA amounted to R$23 million, with a margin of 35%.
CSN’s shares depreciated by 30% in 1Q14, while the Company’s ADRs fell by 27% on the NYSE.
Daily traded volume in CSN’s shares averaged R$73 million in 1Q14, from 6.4 million shares traded. On the NYSE, daily traded volume in CSN’s ADRs averaged US$29 million, from 6.0 million ADRs traded.
Capital Markets - CSNA3 / SID / IBOVESPA / DOW JONES | |
1Q14 | |
N# of shares | 1,457,970,108 |
Market Capitalization | |
Closing price (R$/share) | 9.84 |
Closing price (US$/share) | 4.36 |
Market Capitalization (R$ million) | 14,346 |
Market Capitalization (US$ million) | 6,357 |
Total return including dividends and interest on equity | |
CSNA3 (%) | -30% |
SID (%) | -27% |
Ibovespa | -2% |
Dow Jones | -1% |
Volume | |
Average daily (thousand shares) | 6,383 |
Average daily (R$ Thousand) | 73,192 |
Average daily (thousand ADRs) | 6,007 |
Average daily (US$ Thousand) | 28,766 |
Source: Economática |
Shareholder Payments
The Annual Shareholders’ Meeting of April 25, 2013 ratified the distribution of dividends and interest on equity (IOE) as follows: (i) dividends of R$210 million and IOE of R$90 million paid on August 15, 2013; and (ii) dividends of R$400 million and IOE of R$100 million, paid on November 28, 2013, approved by the Board of Directors at meetings held on August 6, 2013 and November 13, 2013, respectively.
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(Expressed in thousands of reais - R$, unless otherwise stated)
1. DESCRIPTION OF BUSINESS
Companhia Siderúrgica Nacional “CSN”, also referred to as the 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, associates and jointly controlled entities collectively referred to herein as the "Group”). The Company’s registered office is located in São Paulo, SP, Brazil.
CSN has shares listed on the São Paulo Stock Exchange (BM&F BOVESPA) and the New York Stock Exchange (NYSE). Accordingly, it reports its information to the Brazilian Securities Commission (CVM) and the U.S. Securities and Exchange Commission (SEC).
The Group's main operating activities are divided into five (5) operating segments as follows:
· Steel:
The Company’s main industrial facility is the Presidente Vargas Steel Mill (“UPV”), located in the city of Volta Redonda, State of Rio de Janeiro. This segment consolidates the 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 operations in the United States, Portugal and Germany aimed at gaining markets and performing excellent services for final consumers. Its steels are used in the home appliances, civil construction and automobile industries.
· Mining:
The production of iron ore is developed in the city of Congonhas, in the State of Minas Gerais. It further mines tin in the State of Rondônia to supply the needs of UPV, with the excess of these raw materials being sold to subsidiaries and third parties. CSN holds the concession to operate TECAR, a solid bulk terminal, one of the 4 (four) terminals that comprise the Itaguaí Port, in Rio de Janeiro. Importations of coal and coke are carried out through this terminal.
· Cement:
CSN entered the cement market boosted by the synergy between this new activity and its already existing businesses. Next to the Presidente Vargas Steel Mill in Volta Redonda (RJ), it installed a new business unit: CSN Cimentos, which produces CP-III type cement by using slag produced by the UPV blast furnaces in Volta Redonda. It also explores limestone and dolomite at the Arches drive in the State of Minas Gerais, to supply the needs of UPV and of the cement plant.
· Logistics
Railroads:
CSN has equity interests in three railroad companies: MRS Logística S. A., which manages the former Southeast Railway System of Rede Ferroviária Federal S.A., Transnordestina Logística S. A. (“TLSA”) and FTL - Ferrovia Transnordestina Logística S.A. (“FTL”), which operate the Northeast Railway System of RFFSA, in the States of Maranhão, Piauí, Ceará, Rio Grande do Norte, Paraíba, Pernambuco and Alagoas, with TLSA being responsible for the streches of Missão Velha - Salgueiro, Salgueiro - Trindade, Trindade - Eliseu Martins, Salgueiro - Porto de Suape and Missão Velha - Porto de Pecém (Railway System II) and FTL being responsible for the streches of São Luiz - Mucuripe, Arrojado - Recife, Itabaiana - Cabedelo, Paula Cavalcante - Macau and Propriá - Jorge Lins (Railway System I).
Ports:
In the State of Rio de Janeiro, by means of its subsidiary Sepetiba Tecon S. A., the Company operates the Container Terminal (Tecon) at the Itaguaí Port. Located in the Bay of Sepetiba, this port has privileged highway, railroad and maritime access.
Tecon handles the shipments of CSN steel products, movement of containers, as well as storage, consolidation and deconsolidation of cargo.
· Energy:
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As energy is fundamental in its production process, the Company has assets for generation of electric power to guarantee its self-sufficiency.
For further details on the Group's segments, see Note 24 - Business Segment Reporting.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of preparation
The consolidated condensed interim financial statements have been prepared and are being presented in accordance with the International Accounting Standards (IAS 34 – Interim Financial Reporting) issued by the International Accounting Standards Board (IASB), which correlate in Brazil is the CPC 21 (R1) (Interim Financial Statements and Consolidated Interim Financial Statements) issued by the CPC (Accounting Pronouncements Committee) and approved by CVM (Brazilian Securities Commission).
The individual condensed interim financial statements have been prepared in accordance with the standards issued by the CPC and the CVM applicable to the preparation of the financial statements.
The significant accounting policies applied in these condensed interim financial statements are consistent with the policies described in Note 2 to the Company's financial statements for the year ended December 31, 2013, filed with the CVM.
These condensed interim financial statements do not include all requirements of annual or full financial statements and, accordingly, should be read together with the Company's financial statements for the year ended December 31, 2013.
Therefore, in these condensed interim financial statements the following notes were not repeated, either due to redundancy or to relevance in relation to those already presented in the annual financial statements:
Note 02 – Summary of significant accounting policies
Note 03 – Changes in accounting policies
Note 04 – Business combination
Note 28 – Employee benefits
The individual and consolidated condensed interim financial statements were approved by the Board of Directors on May 6, 2014.
(b) Basis of presentation
The consolidated condensed interim financial statements are presented in Brazilian reais (R$), which is the Company’s functional currency and the Group’s presentation currency.
Transactions in foreign currencies are translated into the functional currency using the exchange rates in effect at the dates of the transactions or valuation on which items are remeasured. The asset and liability balances are translated at the exchange rate in effect at the end of the reporting period. As of March 31, 2014, US$1 is equivalent to R$2.2630 (R$2.3426 as of December 31, 2013), €$ 1 is equivalent to R$3.1175 (R$3.2265 as of December 31, 2013) and ¥$ 1 is equivalent to R$0.02197 (R$0.02233 as of December 31, 2013).
(c) Basis of consolidation
The consolidated condensed interim financial statements for the period ended March 31, 2014 and the year ended December 31, 2013 include the following direct and indirect subsidiaries and jointly controlled entities, as well as the exclusive funds as described below:
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Equity interests (%) |
||||||
Companies |
3/31/2014 |
12/31/2013 |
Core business | |||
Direct interest in subsidiaries: full consolidation |
|
|
|
|
|
|
CSN Islands VII Corp. |
100.00 |
100.00 |
Financial transactions | |||
CSN Islands VIII Corp. |
|
100.00 |
|
100.00 |
|
Financial transactions |
CSN Islands IX Corp. |
100.00 |
100.00 |
Financial transactions | |||
CSN Islands X Corp. |
|
100.00 |
|
100.00 |
|
Financial transactions |
CSN Islands XI Corp. |
100.00 |
100.00 |
Financial transactions | |||
CSN Islands XII Corp. |
|
100.00 |
|
100.00 |
|
Financial transactions |
CSN Minerals S.L.U. |
100.00 |
100.00 |
Equity interests | |||
CSN Export Europe, S.L.U. |
|
100.00 |
|
100.00 |
|
Financial transactions and equity interests |
CSN Metals S.L.U. |
100.00 |
100.00 |
Equity interests and financial transactions | |||
CSN Americas S.L.U. |
|
100.00 |
|
100.00 |
|
Equity interests and financial transactions |
CSN Steel S.L.U. |
100.00 |
100.00 |
Equity interests and financial transactions | |||
TdBB S.A |
|
100.00 |
|
100.00 |
|
Dormant company |
Sepetiba Tecon S.A. |
99.99 |
99.99 |
Port services | |||
Mineração 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 |
Cia Metalic Nordeste |
99.99 |
99.99 |
Manufacture of packaging and distribution of steel products | |||
Companhia Metalúrgica Prada |
|
99.99 |
|
99.99 |
|
Manufacture of packaging and distribution of steel products |
CSN Cimentos S.A. |
99.99 |
99.99 |
Cement manufacturing | |||
CSN Gestão de Recursos Financeiros Ltda. |
|
99.99 |
|
99.99 |
|
Dormant company |
Congonhas Minérios S.A. |
99.99 |
99.99 |
Mining and equity interests | |||
CSN Energia S.A. |
|
99.99 |
|
99.99 |
|
Sale of electric powe |
FTL - Ferrovia Transnordestina Logística S.A. |
88.41 |
88.41 |
Railroad logistics | |||
Indirect interest in subsidiaries: full consolidation |
|
|
|
|
|
|
CSN Aceros S.A. |
100.00 |
100.00 |
Equity interests | |||
Companhia Siderúrgica Nacional LLC |
|
100.00 |
|
100.00 |
|
Steel |
CSN Europe Lda. |
100.00 |
100.00 |
Financial transactions, product sales and equity interests | |||
CSN Ibéria Lda. |
|
100.00 |
|
100.00 |
|
Financial transactions, product sales and equity interests |
CSN Portugal, Unipessoal Lda. |
100.00 |
100.00 |
Financial transactions and product sales | |||
Lusosider Projectos Siderúrgicos S.A. |
|
99.99 |
|
99.99 |
|
Equity interests |
Lusosider Aços Planos, S. A. |
99.98 |
99.98 |
Steel and equity interests | |||
CSN Acquisitions, Ltd. |
|
100.00 |
|
100.00 |
|
Financial transactions and equity interests |
CSN Resources S.A. |
100.00 |
100.00 |
Financial transactions and equity interests | |||
CSN Holdings (UK) Ltd |
|
100.00 |
|
100.00 |
|
Financial transactions and equity interests |
CSN Handel GmbH |
100.00 |
100.00 |
Financial transactions, product sales and equity interests | |||
Companhia Brasileira de Latas |
|
59.17 |
|
59.17 |
|
Sale of cans and containers in general and equity interests |
Rimet Empreendimentos Industriais e Comerciais S. A. |
58.96 |
58.96 |
Production and sale of steel containers and forestry | |||
Companhia de Embalagens Metálicas MMSA |
|
58.98 |
|
58.98 |
|
Production and sale of cans and related activities |
Empresa de Embalagens Metálicas - LBM Ltda. |
58.98 |
58.98 |
Sales of containers and holding interests in other entities | |||
Empresa de Embalagens Metálicas - MUD Ltda. |
|
58.98 |
|
58.98 |
|
Production and sale of household appliances and related products |
Companhia de Embalagens Metálicas - MTM do Nordeste |
58.98 |
58.98 |
Production and sale of cans and related activities | |||
Companhia de Embalagens Metálicas - MTM |
|
58.98 |
|
58.98 |
|
Production and sale of cans and related activities |
CSN Steel Comercializadora, S.L.U. |
100.00 |
100.00 |
Financial transactions, product sales and equity interests | |||
CSN Steel Holdings 1, S.L.U. |
|
100.00 |
|
100.00 |
|
Financial transactions, product sales and equity interests |
CSN Steel Holdings 2, S.L.U. |
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 UK Limited |
100.00 |
100.00 |
Financial transactions, product sales and equity interests | |||
CSN Steel Sections Czech Republic s.r.o. |
|
100.00 |
|
100.00 |
|
Financial transactions, product sales and equity interests |
CSN Steel Sections Polska Sp.Z.o.o |
100.00 |
100.00 |
Financial transactions, product sales and equity interests | |||
Direct interest in jointly controlled entities: proportionate consolidation |
|
|
|
| ||
Itá Energética S.A. |
48.75 |
48.75 |
Electric power generation | |||
CGPAR - Construção Pesada S.A. |
|
50.00 |
|
50.00 |
|
Mining support services and equity interests |
Consórcio da Usina Hidrelétrica de Igarapava |
17.92 |
17.92 |
Electric power consortium | |||
Direct interest in jointly controlled entities: equity method |
|
|
|
|
|
|
Nacional Minérios S.A. |
60.00 |
60.00 |
Mining and equity interests | |||
MRS Logística S.A. |
|
27.27 |
|
27.27 |
|
Railroad transportation |
Aceros Del Orinoco S.A. |
22.73 |
22.73 |
Dormant company | |||
CBSI - Companhia Brasileira de Serviços de Infraestrutura |
|
50.00 |
|
50.00 |
|
Provision of services |
Transnordestina Logística S.A. |
77.30 |
77.30 |
Railroad logistics | |||
Indirect interest in jointly controlled entities: equity method |
|
|
|
|
|
|
Namisa International Minérios SLU |
60.00 |
60.00 |
Financial transactions, product sales and equity interests | |||
Namisa Europe, Unipessoal Lda. |
|
60.00 |
|
60.00 |
|
Equity interests and sales of products and minerals |
Namisa Handel GmbH |
60.00 |
60.00 |
Financial transactions, product sales and equity interests | |||
MRS Logística S.A. |
|
6.00 |
|
6.00 |
|
Railroad transportation |
Aceros Del Orinoco S.A. |
9.08 |
9.08 |
Dormant company | |||
Direct interest in associates: equity method |
|
|
|
|
|
|
Arvedi Metalfer do Brasil S.A. |
20.00 |
20.00 |
Steel and equity interests | |||
PAGE 31 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
||
ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
· Exclusive funds
Equity interests (%) |
||||||
Exclusive funds |
3/31/2014 |
12/31/2013 |
Core business | |||
Direct interest: full consolidation |
|
|
|
|
|
|
Diplic - Private credit balanced mutual fund |
100.00 |
100.00 |
Investment fund | |||
Mugen - Private credit balanced mutual fund |
|
100.00 |
|
100.00 |
|
Investment fund |
Caixa Vértice - Private credit balanced mutual fund |
100.00 |
100.00 |
Investment fund |
3. CASH AND CASH EQUIVALENTS
|
|
Consolidated |
|
|
Parent Company | ||
|
3/31/2014 |
|
12/31/2013 |
3/31/2014 |
12/31/2013 | ||
Current |
|
|
|
|
|
|
|
Cash and cash equivalents |
|||||||
Cash and banks |
198,323 |
|
178,920 |
|
47,879 |
|
36,553 |
Short-term investments |
|
|
|
|
|
|
|
In Brazil: |
|||||||
Government securities |
103,329 |
|
48,206 |
|
88,800 |
|
42,575 |
Private securities |
318,549 |
240,852 |
46,732 |
57,564 | |||
|
421,878 |
|
289,058 |
|
135,532 |
|
100,139 |
Abroad: |
|||||||
Time deposits |
9,380,171 |
|
9,527,694 |
|
57,563 |
|
69,932 |
Total short-term investments |
9,802,049 |
9,816,752 |
193,095 |
170,071 | |||
Cash and cash equivalents |
10,000,372 |
|
9,995,672 |
|
240,974 |
|
206,624 |
The funds available in the Company and subsidiaries set up in Brazil are basically invested in investment funds, classified as exclusive, with repurchase agreements backed by government and private bonds with immediate liquidity.
Private securities are short-term investments in Bank Deposit Certificates (CDBs) with yields pegged to the Interbank Deposit Certificate (CDI) fluctuation, and government securities are basically repurchase agreements backed by National Treasury Notes series B (NTN-B), series F (NTN-F) and Financial Treasury Bills (LFTs). The exclusive funds managed by BTG Pactual Serviços Financeiros S.A. DTVM and Caixa Econômica Federal and their assets collateralize possible losses on investments and transactions carried out. Investments in funds were consolidated.
In addition, a significant part of the funds of the Company and its foreign subsidiaries is invested in Time Deposits with leading banks, bearing fixed rates.
PAGE 32 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
||
ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
4. TRADE RECEIVABLES
Consolidated |
|
|
|
Parent Company | |||
3/31/2014 |
|
12/31/2013 |
|
3/31/2014 |
12/31/2013 | ||
Trade receivables |
|
|
|
|
|
|
|
Third parties |
|
|
|
|
|
|
|
Domestic market |
1,024,133 |
|
790,225 |
|
616,299 |
|
545,927 |
Foreign market |
604,028 |
|
950,145 |
|
62,460 |
|
80,434 |
Estimated losses on doubtful debts |
-116,520 |
|
-114,172 |
|
-90,257 |
|
-88,518 |
|
1,511,641 |
|
1,626,198 |
|
588,502 |
|
537,843 |
Related parties (Note 17 - b) |
109,501 |
|
107,443 |
|
613,264 |
|
632,645 |
|
1,621,142 |
|
1,733,641 |
|
1,201,766 |
|
1,170,488 |
|
|
|
|
|
|
|
|
Other receivables |
|
|
|
|
|
|
|
Dividends receivable (*) (Note 17 - b) |
31,571 |
717,595 |
|
84,879 |
774,147 | ||
Other receivables |
52,997 |
|
71,229 |
|
33,545 |
|
48,069 |
84,568 |
788,824 |
|
118,424 |
822,216 | |||
|
1,705,710 |
|
2,522,465 |
|
1,320,190 |
|
1,992,704 |
(*) Reversal of dividends of the jointly controlled entity Nacional Minérios S.A., as mentioned in note 7 c.
The breakdown of gross trade receivables from third parties is as follows:
Consolidated |
|
|
|
Parent Company | ||||
3/31/2014 |
|
12/31/2013 |
|
3/31/2014 |
12/31/2013 | |||
Falling due |
|
1,157,110 |
|
1,339,481 |
|
366,368 |
|
373,190 |
Overdue until 180 days |
|
248,939 |
|
216,392 |
|
110,355 |
|
90,165 |
Overdue above 180 days |
|
222,112 |
|
184,497 |
|
202,036 |
|
163,006 |
|
|
1,628,161 |
|
1,740,370 |
|
678,759 |
|
626,361 |
In order to meet the needs of some customers in the domestic market, related to the extension of the payment term for billing of steel, in common agreement with CSN’s internal commercial policy and maintenance of its very short-term receipts (up to 7 days), at the request of the customer, transactions are carried out for assignment of receivables without co-obligation negotiated between the customer and banks with common relationship, where CSN assigns the trade notes/bills that it issues to the banks with common relationship.
Due to the characteristics of the transactions for assignment of receivables without co-obligation, after assignment of the customer’s trade notes/bills and receipt of the funds from the closing of each transaction, CSN settles the trade receivables and becomes entirely free of the credit risk on the transaction. This transaction totals R$405,351 as of March 31, 2014 (R$386,732 as of December 31, 2013), less the trade receivables.
The changes in the Company’s allowance for doubtful debts are as follows:
Consolidated |
|
|
|
Parent Company | ||||
3/31/2014 |
|
12/31/2013 |
|
3/31/2014 |
12/31/2013 | |||
Opening balance |
|
-114,172 |
|
-111,532 |
|
-88,518 |
|
-86,391 |
Allowance for losses on trade receivables |
-4,451 |
|
-17,988 |
|
-3,261 |
|
-13,902 | |
Recovery of receivables |
|
2,103 |
|
15,348 |
|
1,522 |
|
11,775 |
Closing balance |
-116,520 |
-114,172 |
-90,257 |
-88,518 |
PAGE 33 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
||
ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
5. INVENTORIES
Consolidated |
|
|
|
Parent Company | |||
3/31/2014 |
|
12/31/2013 |
|
3/31/2014 |
12/31/2013 | ||
Finished products |
759,522 |
|
743,831 |
|
564,332 |
|
529,068 |
Work in process |
770,758 |
650,311 |
|
673,024 |
550,227 | ||
Raw materials |
848,043 |
|
714,365 |
|
547,573 |
|
436,283 |
Storeroom supplies |
995,534 |
1,003,473 |
|
872,423 |
877,944 | ||
Iron ore |
127,767 |
|
139,275 |
|
127,767 |
|
139,275 |
Advances to suppliers |
18,520 |
11,915 |
|
15,632 |
9,859 | ||
(-) Estimated losses |
-118,385 |
|
-102,185 |
|
-98,050 |
|
-83,426 |
3,401,759 |
3,160,985 |
|
2,702,701 |
2,459,230 | |||
Changes in the allowance for inventory losses are as follows:
Consolidated |
|
|
|
Parent Company | ||||
3/31/2014 |
|
12/31/2013 |
|
3/31/2014 |
31/12/2013 | |||
Opening balance |
|
-102,185 |
|
-108,160 |
|
-83,426 |
|
-90,344 |
Allowance for/reversals of slow-moving inventories |
|
-16,200 |
5,975 |
-14,624 |
6,918 | |||
Closing balance |
|
-118,385 |
|
-102,185 |
|
-98,050 |
|
-83,426 |
Allowances for certain items considered obsolete or slow-moving were recognized.
As of March 31, 2014, the Company has long-term iron ore inventories amounting to R$144,483, classified in other non-current assets (R$144,483 as of December 31, 2013), as described in note 6.
6. OTHER CURRENT AND NON-CURRENT ASSETS
The group of other current and non-current assets is comprised as follows:
|
|
|
|
Consolidated |
|
|
|
Parent Company | |||||||
Current |
Non-current |
|
Current |
|
Non-current | ||||||||||
3/31/2014 |
12/31/2013 |
|
3/31/2014 |
12/31/2013 |
|
3/31/2014 |
12/31/2013 |
|
3/31/2014 |
12/31/2013 | |||||
Judicial deposits (Note 15) |
|
|
|
|
695,429 |
|
693,714 |
|
|
|
|
|
652,530 |
|
650,463 |
Credits with the PGFN (*) |
|
90,294 |
88,921 |
|
|
90,294 |
88,921 | ||||||||
Recoverable taxes (**) |
485,990 |
|
480,495 |
|
109,122 |
|
112,788 |
|
300,240 |
|
298,279 |
|
93,071 |
|
94,342 |
Prepaid expenses |
50,714 |
37,369 |
36,894 |
38,117 |
|
40,742 |
27,394 |
17,855 |
18,600 | ||||||
Actuarial asset - related party (Note 17 b) |
|
|
|
|
97,051 |
|
97,051 |
|
|
|
|
|
96,665 |
|
96,665 |
Derivative financial instruments (Note 11 I) |
3,030 |
9,681 |
3,879 |
|
|||||||||||
Securities held for trading (Note 11 I) |
9,111 |
|
9,906 |
|
|
|
|
|
6,453 |
|
7,041 |
|
|
|
|
Ore inventory (Note 5) |
144,483 |
144,483 |
144,483 |
144,483 | |||||||||||
Northeast Investment Fund (FINOR) |
|
|
|
|
8,452 |
|
8,452 |
|
|
|
|
|
8,452 |
|
8,452 |
Trade receivables |
985 |
9,970 |
1,646 |
10,631 | |||||||||||
Loans with related parties (Note 17 b) |
377,039 |
|
147,273 |
|
191,481 |
|
603,862 |
|
20,386 |
|
46,722 |
|
90,124 |
|
237,710 |
Other receivables from related parties (Note 17 b) |
10,796 |
15,658 |
14,360 |
18,129 |
53,810 |
16,180 |
118,913 |
155,932 | |||||||
Other |
23,203 |
|
22,538 |
|
16,695 |
|
15,959 |
|
|
|
|
|
16,365 |
|
15,649 |
959,883 |
722,920 |
1,405,246 |
1,835,325 |
421,631 |
395,616 |
1,330,398 |
1,521,848 | ||||||||
(*) Refers to the excess judicial deposit originated by the 2009 REFIS (Tax Debt Refinancing Program).
.
(**) Refers mainly to taxes on revenue (PIS/COFINS) and State VAT (ICMS) on the acquisition of fixed assets which will be recovered over a 48-month period, and income tax and social contribution for offset.
PAGE 34 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
||
ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
7. INVESTMENTS
The information related to the description of activities of subsidiaries, jointly controlled entities, associates and other investments did not have changes in relation to that disclosed in the Company's financial statements as of December 31, 2013 and, accordingly, the Company decided not to repeat it in the condensed interim financial statements as of March 31, 2014.
a) Direct equity interests in subsidiaries, jointly controlled entities, joint operations and associates
|
|
|
|
|
|
|
|
|
|
|
|
|
3/31/2014 |
12/31/2013 |
3/31/2013 | |||||||||
Companies |
Number of |
|
|
|||||||||||||||||||||
shares held by CSN |
% |
Profit |
% |
Profit | ||||||||||||||||||||
in units) |
Direct equity |
Shareholders' |
(loss) |
Direct equity |
Shareholders' |
(loss) | ||||||||||||||||||
Common |
Preferred |
interest |
Assets |
Liabilities |
equity |
for the period |
interest |
Assets |
Liabilities |
equity |
for the period | |||||||||||||
Subsidiaries |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CSN Islands VII Corp. |
20,001,000 |
100.00 |
7,610,018 |
8,336,102 |
-726,084 |
-30,863 |
100.00 |
7,958,296 |
8,653,517 |
-695,221 |
84,826 | |||||||||||||
CSN Islands VIII Corp. |
|
2,501,000 |
|
|
|
100.00 |
|
15,750 |
|
11 |
|
15,739 |
|
-497 |
|
100.00 |
|
16,236 |
|
0 |
|
16,236 |
|
-34,862 |
CSN Islands IX Corp. |
3,000,000 |
100.00 |
925,685 |
923,892 |
1,793 |
-175 |
100.00 |
981,698 |
979,730 |
1,968 |
3 | |||||||||||||
CSN Islands X Corp. |
|
1,000 |
|
|
|
100.00 |
|
43 |
|
51,409 |
|
-51,366 |
|
1,426 |
|
100.00 |
|
46 |
|
52,838 |
|
-52,792 |
|
461 |
CSN Islands XI Corp. |
50,000 |
100.00 |
1,706,272 |
1,698,673 |
7,599 |
-341 |
100.00 |
1,796,485 |
1,788,545 |
7,940 |
-22 | |||||||||||||
CSN Islands XII Corp. |
|
1,540 |
|
|
|
100.00 |
|
1,772,118 |
|
2,264,140 |
|
-492,022 |
|
-16,706 |
|
100.00 |
|
1,868,122 |
|
2,343,437 |
|
-475,315 |
|
-29,356 |
International Investment Fund |
-27 | |||||||||||||||||||||||
CSN Minerals S.L.U. |
|
131,649,926 |
|
|
|
100.00 |
|
4,391,613 |
|
1,201 |
|
4,390,412 |
|
-166,518 |
|
100.00 |
|
4,558,786 |
|
1,856 |
|
4,556,930 |
|
-136,622 |
CSN Export Europe, S.L.U. |
35,924,748 |
100.00 |
913,125 |
156 |
912,969 |
-28,876 |
100.00 |
942,194 |
350 |
941,844 |
-14,057 | |||||||||||||
CSN Metals S.L.U. |
|
256,951,582 |
|
|
|
100.00 |
|
1,402,990 |
|
1,732 |
|
1,401,258 |
|
-48,067 |
|
100.00 |
|
1,450,763 |
|
1,438 |
|
1,449,325 |
|
-24,717 |
CSN Americas S.L.U. |
151,877,946 |
100.00 |
1,927,851 |
14,181 |
1,913,670 |
-60,728 |
100.00 |
1,995,959 |
13,962 |
1,981,997 |
-44,821 | |||||||||||||
CSN Steel S.L.U. |
|
454,072,527 |
|
|
|
100.00 |
|
2,625,198 |
|
426,968 |
|
2,198,230 |
|
-43,363 |
|
100.00 |
|
2,714,157 |
|
435,831 |
|
2,278,326 |
|
-25,545 |
Sepetiba Tecon S.A. |
254,015,052 |
99.99 |
347,676 |
88,191 |
259,485 |
16,760 |
99.99 |
324,698 |
81,973 |
242,725 |
9,253 | |||||||||||||
Mineração Nacional S.A. |
|
999,999 |
|
|
|
99.99 |
|
1,092 |
|
20 |
|
1,072 |
|
20 |
|
99.99 |
|
1,067 |
|
15 |
|
1,052 |
|
7 |
Florestal Nacional S.A. |
-12,947 | |||||||||||||||||||||||
Estanho de Rondônia S.A. |
|
34,236,306 |
|
|
|
99.99 |
|
34,067 |
|
12,595 |
|
21,472 |
|
-3,020 |
|
99.99 |
|
34,189 |
|
9,697 |
|
24,492 |
|
1,081 |
Companhia Metalic Nordeste |
92,459,582 |
99.99 |
186,342 |
42,762 |
143,580 |
2,464 |
99.99 |
182,845 |
41,730 |
141,115 |
2,056 | |||||||||||||
Companhia Metalúrgica Prada |
|
601,084 |
|
|
|
99.99 |
|
749,056 |
|
431,799 |
|
317,257 |
|
-19,114 |
|
99.99 |
|
771,436 |
|
465,032 |
|
306,404 |
|
-21,580 |
CSN Cimentos S.A. |
3,734,582,664 |
99.99 |
1,003,930 |
72,406 |
931,524 |
15,538 |
99.99 |
1,012,370 |
84,651 |
927,719 |
13,417 | |||||||||||||
Congonhas Minérios S.A. |
|
64,610,862 |
|
|
|
99.99 |
|
2,049,691 |
|
2,059,385 |
|
-9,694 |
|
-1,511 |
|
99.99 |
|
1,996,614 |
|
2,004,797 |
|
-8,183 |
|
623 |
CSN Energia S.A. |
43,149 |
99.99 |
66,430 |
37,749 |
28,681 |
9,115 |
99.99 |
33,416 |
13,850 |
19,566 |
1,390 | |||||||||||||
FTL - Ferrovia Transnordestina Logística S.A. |
306,241,571 |
|
|
|
88.41 |
|
542,415 |
|
241,732 |
|
300,683 |
|
-1,896 |
|
88.41 |
|
542,162 |
|
239,582 |
|
302,580 |
|
| |
Companhia Florestal do Brasil |
19,358,449 |
99.99 |
21,091 |
1,801 |
19,290 |
99.99 |
20,858 |
1,567 |
19,291 |
|||||||||||||||
Jointly controlled entities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nacional Minérios S.A. |
285,040,443 |
60.00 |
9,328,210 |
414,111 |
8,914,099 |
82,767 |
60.00 |
9,404,480 |
1,058,093 |
8,346,387 |
119,095 | |||||||||||||
Itá Energética S.A. |
|
253,606,842 |
|
|
|
48.75 |
|
344,494 |
|
17,611 |
|
326,883 |
|
3,754 |
|
48.75 |
|
341,188 |
|
18,059 |
|
323,129 |
|
-1,420 |
MRS Logística S.A. |
52,414,152 |
40,301,916 |
27.27 |
1,793,850 |
1,047,791 |
746,059 |
18,271 |
27.27 |
1,853,628 |
1,126,803 |
726,825 |
17,081 | ||||||||||||
CBSI - Companhia Brasileira de Serviços de Infraestrutura |
1,876,146 |
|
|
|
50.00 |
|
20,263 |
|
17,193 |
|
3,070 |
|
-110 |
|
50.00 |
|
20,590 |
|
16,244 |
|
4,346 |
|
-237 | |
CGPAR - Construção Pesada S.A. |
50,000 |
50.00 |
59,047 |
51,588 |
7,459 |
2,636 |
50.00 |
53,527 |
48,703 |
4,824 |
1,384 | |||||||||||||
Transnordestina Logística S.A. |
|
22,714,245 |
|
1,397,545 |
|
77.30 |
|
4,331,555 |
|
3,013,491 |
|
1,318,064 |
|
-7,035 |
|
77.30 |
|
4,286,381 |
|
2,961,282 |
|
1,325,099 |
|
-13,663 |
Associates |
||||||||||||||||||||||||
Arvedi Metalfer do Brasil |
|
21,408,833 |
|
|
|
20.00 |
|
37,720 |
|
21,558 |
|
16,162 |
|
-2,416 |
|
20.00 |
|
49,800 |
|
34,441 |
|
15,359 |
|
-189 |
The number of shares, the balances of assets, liabilities and shareholders' equity, and the amounts of profit or loss for the year refer to the equity interests held by CSN in those companies.
b) Events in 2013
· Transnordestina Logística S.A. (“TLSA”)
On September 20, 2013, the Company signed (i) An Addendum to the Concession Agreement of the Northeast Railway System, which encompasses the stretches between the cities of São Luís to Mucuripe, Arrojado to Recife, Itabaiana to Cabedelo, Paula Cavalcante to Macau, and Propriá to Jorge Lins (“Railway System I”) and the stretches between the cities of Missão Velha to Salgueiro, Salgueiro to Trindade, Trindade to Eliseu Martins, Salgueiro to Porto de Suape, and Missão Velha to Porto de Pecém (“Railway System II”), to include therein obligations assumed by TLSA related to the implementation of the Railway System II, as well as the adaptation of the stretches that comprise it and (ii) Conduct Adjustment Agreement between ANTT and TLSA, with the purpose of resolving pending items existing between the parties.
On that date the following agreements were also signed (i) a new Shareholders' Agreement of TLSA between CSN, Valec Engenharia, Construções e Ferrovias S.A. (“Valec”), Fundo de Desenvolvimento do Nordeste – FDNE (“FDNE”) and BNDES Participações S.A. – BNDESPAR (“BNDESPAR”), with the intervenience of TLSA, whose effectiveness was conditioned to the disproportionate spin-off of TLSA, to be implemented under the terms of ANTT Resolution 4,042/2013; and (ii) Investment Agreement between CSN, Valec and FDNE, with the intervenience of TLSA, which besides other matters, deals with the new budget and the sources of funds that will have to be contributed to TLSA or financed for implementation of the Railway System II.
PAGE 35 of 70
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At the Extraordinary Shareholders' Meeting held on December 27, 2013, as part of the reorganization process described above, the shareholders approved the disproportionate spin-off of TLSA, completing the segregation of Railway System I and Railway System II.
The purpose of this restructuring was to rebalance economically and financially the Northeast Railway System concession, leading to the extension of the Railway System II operation concession, which could reach 2057, and the segregation of the assets related to Railway System I, which were merged into subsidiary FTL - Ferrovia Transnordestina Logística S.A. (“FTL”), with the maintenance of the assets related to Railway System II in TLSA.
As a result of the spin-off, CSN became the holder of an 88.41% stake in FTL and a 77.30% stake in TLSA.
With the completion of the spin-off, the new Shareholders’ Agreement became effective and control is now jointly held with the shareholders part of the public block, which became the holders of substantive rights to make certain material company decisions and influence the ordinary course of business, as well as CSN, by influencing budgeting, internal policies, capital expenditures, debt, etc., thus typifying the loss of control by CSN, pursuant to specific IFRS criteria.
Accordingly, as of December 31, 2013, in accordance with IFRS 10, corresponding to CPC 36(R3), CSN reversed all TLSA assets and liabilities and non-controlling interests and started to recognize the remaining stake in this investment at fair value on the date control was lost. After this initial recognition, the investment starts to be measured under the equity method.
The gain generated by the loss of control over the investment recognized in the income statement, in other operating income in 2013, is broken down as follows:
Consolidated |
Parent Company | ||
12/31/2013 |
12/31/2013 | ||
Fair value of the remaining investment |
1,984,204 |
|
1,984,204 |
Carrying amount of net assets |
1,714,232 |
1,325,099 | |
Carrying amount of non-controlling interests |
389,133 |
|
|
Gain on loss of control over Transnordestina |
659,105 |
659,105 | |
Capitalized interest written off |
185,206 |
|
185,206 |
Gain on loss of control over Transnordestina |
473,899 |
473,899 | |
Income tax and social contribution |
161,126 |
|
161,126 |
Gain on loss of control, net of income tax and social contribution (*) |
312,773 |
312,773 |
(*) the goodwill will be amortized monthly, from the completion of the construction work to the final concession date.
PAGE 36 of 70
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
c) Changes in investments in subsidiaries, jointly controlled entities, joint ventures, associates, and other investments
Consolidated |
Parent Company | ||||||
3/31/2014 |
|
12/31/2013 |
3/31/2014 |
|
12/31/2013 | ||
Opening balance of investments |
13,487,023 |
|
10,839,787 |
|
27,005,592 |
|
23,356,506 |
Opening balance of impairment loss allowance |
|
|
|
|
-1,231,511 |
|
-851,298 |
Transnordestina Investment balance at 12.31.2012 |
|
|
1,452,074 |
|
|
|
|
Capital increase/acquisition of shares |
2,615 |
164,941 |
32,586 |
654,692 | |||
Capital reduction |
|
|
-153,305 |
|
|
|
|
Merger and partial spin-off of subsidiaries |
132,725 | ||||||
Dividends (1) |
484,010 |
|
-85,998 |
|
484,010 |
|
-139,887 |
Comprehensive income (2) |
-647,064 |
73,213 |
-685,353 |
456,978 | |||
Share of profits of investees (3) |
90,495 |
|
542,711 |
|
-291,125 |
|
1,502,450 |
Gain on loss of control over Transnordestina |
659,106 |
659,106 | |||||
Other |
|
|
-5,506 |
|
|
|
2,809 |
Closing balance of investments |
13,417,079 |
13,487,023 |
26,593,365 |
27,005,592 | |||
Closing balance of impairment loss allowance |
|
|
|
|
-1,279,166 |
|
-1,231,511 |
1. On March 28, 2014, the Annual General Meeting of the jointly controlled entity Nacional Minérios S.A. decided to allocate fully the profit (loss) for 2012 to the Investment Reserve and Contingencies Reserve accounts. In view of this decision of the general meeting, the company reversed the dividends receivable that had been recorded according to NAMISA's management proposal and that were not approved by such meeting.
2. Refers to the mark-to-market of investments classified as available for sale and translation to the reporting currency of the foreign investments, the functional currency of which is not the Brazilian reais.
3. Below is the reconciliation of the share of profit of jointly controlled entities with the share of profit of investees recognized in the balance sheet after the reclassifications:
Consolidated | |||
3/31/2014 |
|
12/31/2013 | |
Share of profit of jointly controlled entities |
90,495 |
|
542,711 |
Reclassifications |
|||
To cost of sales |
-44,118 |
|
-137,418 |
To finance costs |
-161,939 |
-624,096 | |
To taxes |
70,059 |
|
258,914 |
Other |
|||
Elimination of Transnordestina’s profit |
|
|
120,102 |
Other |
-2,075 | ||
Adjusted share of profit of investees |
-45,503 |
|
158,138 |
PAGE 37 of 70
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Version: 1 |
d) Investments in joint ventures and joint operations
The balances of the balance sheets and income statements of the companies under shared control are stated below:
|
|
|
|
|
|
|
|
3/31/2014 |
|
12/31/2013 | ||||||||||||||
|
Nacional Minérios (*) |
Itá Energética |
MRS Logística |
CBSI |
CGPAR |
|
Transnordestina Logística |
Nacional Minérios (*) |
|
Itá Energética |
|
MRS Logística |
|
CBSI |
|
CGPAR |
|
Transnordestina Logística | ||||||
Equity interest (%) |
60.00% |
48.75% |
27.27% |
50.00% |
50.00% |
77.30% |
60.00% |
48.75% |
27.27% |
50.00% |
50.00% |
77.30% | ||||||||||||
Balance sheet |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets |
||||||||||||||||||||||||
Cash and cash equivalents |
|
4,568,786 |
|
60,528 |
|
435,918 |
|
5,414 |
|
17,591 |
|
132,867 |
|
4,815,211 |
|
45,894 |
|
471,079 |
|
12,897 |
|
28,582 |
|
195,830 |
Other current assets |
814,777 |
17,762 |
542,175 |
28,553 |
41,028 |
46,232 |
1,135,192 |
16,682 |
630,121 |
21,407 |
33,055 |
39,183 | ||||||||||||
Total current assets |
|
5,383,563 |
|
78,290 |
|
978,093 |
|
33,967 |
|
58,619 |
|
179,099 |
|
5,950,403 |
|
62,576 |
|
1,101,200 |
|
34,304 |
|
61,637 |
|
235,013 |
Non-current assets |
||||||||||||||||||||||||
Long-term assets |
|
8,760,127 |
|
33,802 |
|
346,535 |
|
11 |
|
18 |
|
235,216 |
|
8,391,119 |
|
34,029 |
|
414,624 |
|
4 |
|
11 |
|
229,280 |
Investments, PP&E and intangible assets |
1,403,326 |
594,563 |
5,253,624 |
6,549 |
59,458 |
5,189,258 |
1,356,909 |
603,268 |
5,281,642 |
6,872 |
45,405 |
5,080,841 | ||||||||||||
Total non-current assets |
|
10,163,453 |
|
628,365 |
|
5,600,159 |
|
6,560 |
|
59,476 |
|
5,424,474 |
|
9,748,028 |
|
637,297 |
|
5,696,266 |
|
6,876 |
|
45,416 |
|
5,310,121 |
Total assets |
15,547,016 |
706,655 |
6,578,252 |
40,527 |
118,095 |
5,603,573 |
15,698,431 |
699,873 |
6,797,466 |
41,180 |
107,053 |
5,545,134 | ||||||||||||
Current liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowings and financing |
314,764 |
345,526 |
21,196 |
67,433 |
42,247 |
333,796 |
20,053 |
97,681 | ||||||||||||||||
Other current liabilities |
|
218,405 |
|
36,125 |
|
567,618 |
|
26,247 |
|
52,033 |
|
47,340 |
|
1,318,884 |
|
35,174 |
|
841,681 |
|
22,437 |
|
36,733 |
|
51,901 |
Total current liabilities |
533,169 |
36,125 |
913,144 |
26,247 |
73,229 |
114,773 |
1,361,131 |
35,174 |
1,175,477 |
22,437 |
56,786 |
149,582 | ||||||||||||
Non-current liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowings and financing |
69,564 |
2,593,629 |
13,097 |
3,377,426 |
339,961 |
2,566,412 |
21,664 |
3,479,420 | ||||||||||||||||
Other non-current liabilities |
|
87,451 |
|
|
|
335,594 |
|
8,140 |
|
16,850 |
|
406,243 |
|
86,694 |
|
1,870 |
|
390,228 |
|
10,050 |
|
18,956 |
|
201,900 |
Total non-current liabilities |
157,015 |
|
2,929,223 |
8,140 |
29,947 |
3,783,669 |
426,655 |
1,870 |
2,956,640 |
10,050 |
40,620 |
3,681,320 | ||||||||||||
Shareholders’ equity |
|
14,856,832 |
|
670,530 |
|
2,735,885 |
|
6,140 |
|
14,919 |
|
1,705,131 |
|
13,910,645 |
|
662,829 |
|
2,665,349 |
|
8,693 |
|
9,647 |
|
1,714,232 |
Total liabilities and shareholders’ equity |
15,547,016 |
706,655 |
6,578,252 |
40,527 |
118,095 |
5,603,573 |
15,698,431 |
699,873 |
6,797,466 |
41,180 |
107,053 |
5,545,134 | ||||||||||||
|
|
|||||||||||||||||||||||
|
|
|
|
|
|
|
|
3/31/2014 |
3/31/2013 |
|||||||||||||||
|
Nacional Minérios (*) |
Itá Energética |
MRS Logística |
CBSI |
CGPAR |
|
Transnordestina Logística |
Nacional Minérios (*) |
|
Itá Energética |
|
MRS Logística |
|
CBSI |
|
CGPAR |
||||||||
Equity interest (%) |
60.00% |
48.75% |
27.27% |
50.00% |
50.00% |
77.30% |
60.00% |
48.75% |
27.27% |
50.00% |
50.00% |
|||||||||||||
Statements of Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Net revenue |
453,090 |
41,242 |
784,616 |
33,997 |
56,917 |
14 |
484,621 |
28,712 |
630,885 |
22,024 |
26,419 |
|||||||||||||
Cost of sales and services |
|
-322,508 |
|
-19,344 |
|
-562,658 |
|
-32,486 |
|
-47,471 |
|
30 |
|
-285,348 |
|
-20,463 |
|
-452,884 |
|
-21,168 |
|
-22,293 |
||
Gross profit |
130,582 |
21,898 |
221,958 |
1,511 |
9,446 |
44 |
199,273 |
8,249 |
178,001 |
856 |
4,126 |
|||||||||||||
Operating (expenses) income |
|
-19,872 |
|
-11,085 |
|
-75,802 |
|
-1,882 |
|
-863 |
|
-5,590 |
|
-52,561 |
|
-10,868 |
|
-50,214 |
|
-1,250 |
|
-9 |
||
Finance income (costs), net |
143,196 |
847 |
-38,763 |
151 |
-276 |
-3,555 |
214,563 |
151 |
-28,628 |
51 |
68 |
|||||||||||||
Income before income tax and social contribution |
253,906 |
|
11,660 |
|
107,393 |
|
-220 |
|
8,307 |
|
-9,101 |
|
361,275 |
|
-2,468 |
|
99,159 |
|
-343 |
|
4,185 |
|||
Current and deferred income tax and social contribution |
-115,961 |
-3,959 |
-40,391 |
-3,036 |
-168,554 |
-444 |
-36,521 |
-131 |
-1,417 |
|||||||||||||||
Profit for the period |
|
137,945 |
|
7,701 |
|
67,002 |
|
-220 |
|
5,271 |
|
-9,101 |
|
192,721 |
|
-2,912 |
|
62,638 |
|
-474 |
|
2,768 |
(*) Refer to the consolidated balances and profit or loss of Nacional Minérios S. A.
The balance sheet and income statement amounts refer to 100% of the companies’ results.
PAGE 38 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
8. PROPERTY, PLANT AND EQUIPMENT
The information related to property, plant and equipment did not have significant changes in relation to that disclosed in the Company's financial statements as of December 31, 2013.
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated |
|
Land |
|
Buildings and infrastructure |
|
Machinery, equipment and facilities |
|
Furniture and fixtures |
|
Construction in progress |
|
Other (*) |
|
Total |
Balance at December 31, 2013 |
213,301 |
|
1,826,519 |
|
7,782,833 |
|
34,127 |
|
4,771,635 |
|
283,011 |
|
14,911,426 |
Cost |
213,301 |
2,196,994 |
12,968,200 |
151,479 |
4,771,635 |
627,845 |
20,929,454 | ||||||
Accumulated depreciation |
|
|
-370,475 |
|
-5,185,367 |
|
-117,352 |
|
|
|
-344,834 |
|
-6,018,028 |
Balance at December 31, 2013 |
213,301 |
1,826,519 |
7,782,833 |
34,127 |
4,771,635 |
283,011 |
14,911,426 | ||||||
Effect of foreign exchange differences |
-1,744 |
|
-5,810 |
|
-24,407 |
|
-99 |
|
-483 |
|
-397 |
|
-32,940 |
Acquisitions |
3 |
56 |
53,070 |
472 |
242,147 |
2,742 |
298,490 | ||||||
Capitalized interest (Notes 23 and 29) |
|
|
|
|
|
|
|
|
43,934 |
|
|
|
43,934 |
Write-offs |
-4,552 |
-42 |
-34 |
-4,628 | |||||||||
Depreciation |
|
|
-18,682 |
|
-254,919 |
|
-1,649 |
|
|
|
-8,176 |
|
-283,426 |
Transfers to other asset categories |
256,014 |
2,256,384 |
897 |
-2,365,734 |
-147,561 |
||||||||
Transfers to intangible assets |
|
|
|
|
|
|
|
|
-7,963 |
|
|
|
-7,963 |
Other |
-28 |
-38,513 |
1 |
39,940 |
-10,015 |
-8,615 | |||||||
Balance at March 31, 2014 |
211,560 |
|
2,058,069 |
|
9,769,896 |
|
33,749 |
|
2,723,434 |
|
119,570 |
|
14,916,278 |
Cost |
211,560 |
2,447,219 |
15,176,879 |
152,492 |
2,723,434 |
468,867 |
21,180,451 | ||||||
Accumulated depreciation |
|
|
-389,150 |
|
-5,406,983 |
|
-118,743 |
|
|
|
-349,297 |
|
-6,264,173 |
Balance at March 31, 2014 |
211,560 |
2,058,069 |
9,769,896 |
33,749 |
2,723,434 |
119,570 |
14,916,278 |
(*) In consolidated, refer basically to railway assets, such as yards, tracks and railway sleepers.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent Company |
|
|
Land |
|
Buildings and infrastructure |
|
Machinery, equipment and facilities |
|
Furniture and fixtures |
|
Construction in progress |
|
Other (*) |
|
Total |
Balance at December 31, 2013 |
|
107,475 |
|
1,225,222 |
|
6,355,738 |
|
26,409 |
|
4,345,142 |
|
358,109 |
|
12,418,095 |
Cost |
107,475 |
1,390,013 |
10,423,838 |
129,930 |
4,345,142 |
467,481 |
16,863,879 | |||||||
Accumulated depreciation |
|
|
|
-164,791 |
|
-4,068,100 |
|
-103,521 |
|
|
|
-109,372 |
|
-4,445,784 |
Balance at December 31, 2013 |
107,475 |
1,225,222 |
6,355,738 |
26,409 |
4,345,142 |
358,109 |
12,418,095 | |||||||
Acquisitions |
|
|
|
56 |
|
37,797 |
|
219 |
|
197,561 |
|
334 |
|
235,967 |
Capitalized interest (Notes 23 and 29) |
43,934 |
43,934 | ||||||||||||
Write-offs |
|
|
|
|
|
-4,247 |
|
|
|
-41 |
|
|
|
-4,288 |
Depreciation |
-11,377 |
-216,969 |
-1,164 |
-3,098 |
-232,608 | |||||||||
Transfers to other asset categories |
|
|
|
252,648 |
|
2,255,089 |
|
897 |
|
-2,361,562 |
|
-147,072 |
|
|
Transfers to intangible assets |
-7,963 |
-7,963 | ||||||||||||
Other |
|
|
|
|
|
-36,739 |
|
|
|
42,135 |
|
-8,635 |
|
-3,239 |
Balance at March 31, 2014 |
107,475 |
1,466,549 |
8,390,669 |
26,361 |
2,259,206 |
199,638 |
12,449,898 | |||||||
Cost |
|
107,475 |
|
1,644,801 |
|
12,667,601 |
|
131,044 |
|
2,259,206 |
|
310,006 |
|
17,120,133 |
Accumulated depreciation |
-178,252 |
-4,276,932 |
-104,683 |
-110,368 |
-4,670,235 | |||||||||
Balance at March 31, 2014 |
|
107,475 |
|
1,466,549 |
|
8,390,669 |
|
26,361 |
|
2,259,206 |
|
199,638 |
|
12,449,898 |
(*) includes leasehold improvements, vehicles, hardware, mines and ore bodies and replacement storeroom supplies.
PAGE 39 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
||
ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
The breakdown of the projects comprising construction in progress is as follows:
|
|
|
|
|
|
|
|
|
|
Consolidated |
|
|
Project objective |
|
Start date |
|
Completion date |
|
3/31/2014 |
|
12/31/2013 |
Logistics |
|
|
|
|
|
|
|
|
|
|
Equalization of Berth 301. |
2012 |
2014 |
180,561 |
151,932 | ||||||
|
|
Current investments for maintenance of current operations. |
|
|
|
|
|
241,964 |
|
231,832 |
422,525 |
383,764 | |||||||||
|
|
|
|
|
|
|
|
|
|
|
Mining |
Expansion of Casa de Pedra Mine capacity production. |
2007 |
2015/2016 |
(1) |
913,748 |
1,090,568 | ||||
|
|
Expansion of TECAR’s export capacity. |
|
2009 |
|
2016 |
(2) |
486,106 |
|
404,374 |
Current investments for maintenance of current operations. |
72,238 |
42,866 | ||||||||
|
|
|
|
|
|
|
1,472,092 |
|
1,537,808 | |
Steel |
|
Construction of a long steel plant to produce rebar and machine wire. |
|
2008 |
|
2014 |
(3) |
140,629 |
|
1,592,016 |
Implementation of the AF#3’s gas pressure recovery. |
2006 |
2014 |
395 |
74,337 | ||||||
|
|
Expansion of the service center/Mogi. |
|
2013 |
|
2015 |
(4) |
13,029 |
|
11,000 |
Current investments for maintenance of current operations. |
95,486 |
668,495 | ||||||||
|
|
|
|
|
|
|
|
249,539 |
|
2,345,848 |
Cement |
||||||||||
|
|
Construction of cement plants. |
|
2011 |
|
2016 |
(5) |
557,212 |
|
476,076 |
Current investments for maintenance of current operations. |
22,066 |
28,139 | ||||||||
|
|
|
|
|
|
|
|
579,278 |
|
504,215 |
Total Construction in Progress |
2,723,434 |
4,771,635 |
(1) Expected date for completion of the 40 Mtpa and 42 Mtpa stages
(2) Expected date for completion of the 60 Mtpa stage
(3) Started in January 2014.
(4) Expected date for completion of Service Center/Mogi;
(5) Expected date for completion of Minas Gerais unit.
a) Additions to depreciation, amortization and depletion for the year were distributed as follows:
Consolidated |
Parent Company | ||||||
3/31/2014 |
|
3/31/2013 |
3/31/2014 |
|
3/31/2013 | ||
Production cost |
279,464 |
|
281,055 |
|
230,561 |
|
226,190 |
Selling expenses |
2,217 |
2,072 |
1,687 |
1,618 | |||
General and administrative expenses |
3,665 |
|
4,109 |
|
2,413 |
|
2,022 |
285,346 |
287,236 |
234,661 |
229,830 | ||||
Other operating expenses (*) |
9,060 |
|
7,037 |
|
|
|
6,785 |
294,406 |
294,273 |
234,661 |
236,615 |
(*) Refers to the depreciation of unused equipment (see note 22).
PAGE 40 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
||
ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
9. INTANGIBLE ASSETS
The information related to intangible assets did not have significant changes in relation to that disclosed in the Company's financial statements as of December 31, 2012 and, accordingly, the Company decided not to repeat it fully in the condensed interim financial statements as of March 31, 2014.
Consolidated |
Parent Company | ||||||||||||||
Goodwill |
|
Customer |
|
Software |
|
Other |
|
Total |
Goodwill |
|
Software |
|
Total | ||
Balance at December 31, 2013 |
407,434 |
|
381,480 |
|
67,354 |
|
109,172 |
|
965,440 |
|
13,091 |
|
63,378 |
|
76,469 |
Cost |
666,768 |
415,899 |
107,416 |
109,172 |
1,299,255 |
14,135 |
89,255 |
103,390 | |||||||
Accumulated amortization |
-150,004 |
|
-34,419 |
|
-40,062 |
|
|
|
-224,485 |
|
-1,044 |
|
-25,877 |
|
-26,921 |
Adjustment for accumulated recoverable value |
-109,330 |
-109,330 |
|||||||||||||
Balance at December 31, 2013 |
407,434 |
|
381,480 |
|
67,354 |
|
109,172 |
|
965,440 |
|
13,091 |
|
63,378 |
|
76,469 |
Effect of foreign exchange differences |
-12,562 |
-26 |
-3,688 |
-16,276 |
|||||||||||
Acquisitions and expenditures |
|
|
|
|
257 |
|
|
|
257 |
|
|
|
|
|
|
Transfer of property, plant and equipment |
7,963 |
7,963 |
7,963 |
7,963 | |||||||||||
Amortization |
|
|
-8,640 |
|
-2,340 |
|
|
|
-10,980 |
|
|
|
-2,053 |
|
-2,053 |
Balance at March 31, 2014 |
407,434 |
360,278 |
73,208 |
105,484 |
946,404 |
13,091 |
69,288 |
|
82,379 | ||||||
Cost |
666,768 |
|
401,850 |
|
137,758 |
|
105,484 |
|
1,311,860 |
|
14,135 |
|
97,217 |
|
111,352 |
Accumulated amortization |
-150,004 |
-41,572 |
-64,550 |
-256,126 |
-1,044 |
-27,929 |
-28,973 | ||||||||
Adjustment for accumulated recoverable value |
-109,330 |
|
|
|
|
|
|
|
-109,330 |
|
|
|
|
|
|
Balance at March 31, 2014 |
407,434 |
360,278 |
73,208 |
105,484 |
946,404 |
13,091 |
69,288 |
82,379 |
10. BORROWINGS, FINANCING AND DEBENTURES
The information related to borrowings, financing and debentures did not have significant changes in relation to that disclosed in the Company's financial statements as of December 31, 2013.
The balances of borrowings, financing and debentures, which are carried at amortized cost, are as follows:
Consolidated |
Parent Company | |||||||||||||||||
Rates p.a. (%) |
|
Current liabilities |
Non-current liabilities |
Current liabilities |
|
Non-current liabilities | ||||||||||||
3/31/2014 |
12/31/2013 |
3/31/2014 |
12/31/2013 |
3/31/2014 |
12/31/2013 |
3/31/2014 |
12/31/2013 | |||||||||||
FOREIGN CURRENCY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prepayment |
1% to 3.50% |
98,625 |
105,874 |
1,579,574 |
1,166,615 |
97,753 |
105,874 |
1,353,274 |
1,166,615 | |||||||||
Prepayment |
|
3.51% to 7.50% |
|
214,525 |
|
207,331 |
|
1,233,335 |
|
1,276,717 |
|
329,192 |
|
343,912 |
|
4,035,339 |
|
4,084,099 |
Perpetual bonds |
7.00% |
3,080 |
3,189 |
2,263,000 |
2,342,600 |
|||||||||||||
Fixed rate notes |
|
4.14 to 10% |
|
960,807 |
|
156,868 |
|
4,412,850 |
|
5,505,110 |
|
49,753 |
|
19,439 |
|
2,350,828 |
|
2,433,517 |
BNDES/FINAME |
12,356 |
11,334 |
||||||||||||||||
Intercompany |
|
6M Libor + 2.25 and 3% |
|
|
|
|
|
|
|
|
|
48,320 |
|
737,297 |
|
775,051 |
|
110,268 |
Other |
1.2% up to 8% |
90,005 |
49,306 |
426,638 |
442,843 |
45,345 |
||||||||||||
|
|
|
|
1,367,042 |
|
534,924 |
|
9,915,397 |
|
10,733,885 |
|
570,363 |
|
1,217,856 |
|
8,514,492 |
|
7,794,499 |
LOCAL CURRENCY |
|
|
|
56,170 |
|
97,044 |
|
964,363 |
|
962,684 |
|
20,597 |
|
57,759 |
|
865,504 |
|
853,379 |
BNDES/FINAME |
TJLP + 1.5% to 3.2% and 2.5% to 10% fixed rate |
810,557 |
846,387 |
1,800,000 |
1,932,500 |
810,557 |
846,387 |
1,800,000 |
1,932,500 | |||||||||
Debentures |
|
105.8% to 111.20% CDI |
|
161,243 |
|
101,330 |
|
5,345,000 |
|
5,345,000 |
|
85,510 |
|
79,302 |
|
3,345,000 |
|
3,345,000 |
Prepayment |
106.5% to 110.79% CDI and 8% fixed rate |
1,087,598 |
1,085,436 |
6,200,000 |
6,200,000 |
1,087,598 |
1,085,436 |
6,200,000 |
6,200,000 | |||||||||
CCB |
|
112.5% CDI |
|
|
|
|
|
|
|
|
|
144,883 |
|
591,423 |
|
1,757,354 |
|
1,338,771 |
Intercompany |
110.79% CDI |
6,805 |
8,527 |
15,896 |
15,505 |
2,154 |
2,119 |
2,156 |
2,118 | |||||||||
Other |
|
|
|
2,122,373 |
|
2,138,724 |
|
14,325,259 |
|
14,455,689 |
|
2,151,299 |
|
2,662,426 |
|
13,970,014 |
|
13,671,768 |
Total borrowings and financing |
3,489,415 |
2,673,648 |
24,240,656 |
25,189,574 |
2,721,662 |
3,880,282 |
22,484,506 |
21,466,267 | ||||||||||
Transaction costs and issue premiums |
|
-28,704 |
|
-30,841 |
|
-81,062 |
|
-85,951 |
|
-23,067 |
|
-25,588 |
|
-67,828 |
|
-71,607 | ||
Total borrowings and financing + transaction costs |
3,460,711 |
2,642,807 |
24,159,594 |
25,103,623 |
2,698,595 |
3,854,694 |
22,416,678 |
21,394,660 |
PAGE 41 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
||
ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
The balances of prepaid related parties borrowings total R$2,916,671 as of March 31, 2014 (R$2,943,964 as of December 31, 2013) and the balances of Fixed Rate Notes and related parties Bonds total R$2,400,581 (R$2,452,956 as of December 31, 2013), see note 17.
· Maturities of borrowings, financing and debentures presented in non-current liabilities
As of March 31, 2014, the principal of long-term borrowings, financing and debentures by maturity year is as follows:
|
|
Consolidated |
|
|
Parent Company | |||
2015 |
|
1,896,939 |
|
8% |
|
2,750,273 |
|
12% |
2016 |
2,499,507 |
10% |
3,708,253 |
16% | ||||
2017 |
|
3,809,346 |
|
16% |
|
3,573,959 |
|
16% |
2018 |
4,185,037 |
17% |
3,787,667 |
17% | ||||
2019 |
|
4,431,817 |
|
18% |
|
3,106,046 |
|
14% |
After 2019 |
5,155,010 |
21% |
5,558,308 |
25% | ||||
Perpetual bonds |
|
2,263,000 |
|
10% |
|
|
|
|
|
|
24,240,656 |
|
100% |
|
22,484,506 |
|
100% |
· Amortizations and new borrowings, financing and debentures
The table below shows the amortizations and new funding in the current period:
Consolidated |
Parent | |||||||
|
3/31/2014 |
|
12/31/2013 |
3/31/2014 |
|
12/31/2013 | ||
Opening balance |
|
27,746,430 |
|
29,304,704 |
|
25,249,354 |
|
24,139,992 |
Funding |
934,146 |
1,697,363 |
807,196 |
1,363,253 | ||||
Amortization |
|
-1,345,598 |
|
-4,300,240 |
|
-1,164,355 |
|
-3,991,884 |
Loss of control over Trasnordestina |
-3,180,821 |
|||||||
Other (*) |
|
285,327 |
|
4,225,424 |
|
223,078 |
|
3,737,993 |
Closing balance |
27,620,305 |
27,746,430 |
25,115,273 |
25,249,354 |
(*) Includes unrealized foreign exchange and monetary variations
Borrowing and financing contracts with certain financial institutions contain some covenants that are usual in financial agreements in general and the Company is compliant with them as of March 31, 2014.
· Debentures
7th issue
In March 2014 the Company issued 40,000 nonconvertible, unsecured debentures, in single series, with a unit face value of R$10 totaling R$400,000 that pay interest equivalent to 111.20% of the CDI Cetip rate per year, maturing in March 2021, with early redemption option.
· Guarantees provided
Guarantees provided for the borrowings comprise property, plant and equipment items and sureties and do not include guarantees provided for subsidiaries and jointly controlled entities. As of March 31, 2014, the amount is R$4,312 (R$4,234 as of December 31, 2013).
PAGE 42 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
||
ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
11. FINANCIAL INSTRUMENTS
The information related to financial instruments did not have significant changes in relation to that disclosed in the Company's financial statements as of December 31, 2013 and, accordingly, the Company decided not to repeat it fully in the condensed interim financial statements as of March 31, 2014.
I - Identification and measurement of financial instruments
The Company enters into transactions involving various financial instruments, mainly cash and cash equivalents, including short-term investments, marketable securities, trade receivables, trade payables, and borrowings and financing. Additionally, it also carries out transactions involving derivative financial instruments, especially exchange and interest rate swaps.
· Classification of financial instruments
Consolidated |
3/31/2014 |
12/31/2013 | |||||||||||||||||||
Notes |
Available for sale |
Fair value through profit or loss |
Loans and receivables - effective interest rate |
Other liabilities - amortized cost method |
|
Balances |
Available for sale |
Fair value through profit or loss |
Loans and receivables - effective interest rate |
Other liabilities - amortized cost method |
|
Balances | |||||||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets |
|||||||||||||||||||||
Cash and cash equivalents |
3 |
|
|
|
|
|
10,000,372 |
|
|
|
10,000,372 |
|
|
|
|
|
9,995,672 |
|
|
|
9,995,672 |
Trade receivables, net |
4 |
|
|
|
|
|
1,621,142 |
|
|
|
1,621,142 |
|
|
|
|
|
1,733,641 |
|
|
|
1,733,641 |
Derivative financial instruments |
6 and 11 |
|
|
3,030 |
|
|
|
|
|
3,030 |
|
|
|
9,681 |
|
|
|
|
|
9,681 | |
Trading securities |
6 |
9,111 |
9,111 |
9,906 |
9,906 | ||||||||||||||||
Total |
|
|
|
|
12,141 |
|
11,621,514 |
|
|
|
11,633,655 |
|
|
|
19,587 |
|
11,729,313 |
|
|
|
11,748,900 |
Non-current assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Other trade receivables |
6 |
985 |
985 |
9,970 |
9,970 | ||||||||||||||||
Investments |
|
|
1,756,395 |
|
|
|
|
|
|
|
1,756,395 |
|
2,405,174 |
|
|
|
|
|
|
|
2,405,174 |
Derivative financial instruments |
6 |
3,879 |
3,879 | ||||||||||||||||||
Short-term investments |
|
|
|
|
|
|
30,042 |
|
|
|
30,042 |
|
|
|
|
|
30,756 |
|
|
|
30,756 |
Total |
1,756,395 |
|
31,027 |
|
1,787,422 |
2,405,174 |
3,879 |
40,726 |
|
2,449,779 | |||||||||||
Total assets |
|
|
1,756,395 |
|
12,141 |
|
11,652,541 |
|
|
|
13,421,077 |
|
2,405,174 |
|
23,466 |
|
11,770,039 |
|
|
|
14,198,679 |
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Current liabilities |
|||||||||||||||||||||
Borrowings and financing |
10 |
|
|
|
|
|
|
|
3,489,415 |
|
3,489,415 |
|
|
|
|
|
|
|
2,673,648 |
|
2,673,648 |
Derivative financial instruments |
11 and 12 |
80,015 |
80,015 |
6,822 |
6,822 | ||||||||||||||||
Trade payables |
|
|
|
|
|
|
|
|
1,340,116 |
|
1,340,116 |
|
|
|
|
|
|
|
1,102,037 |
|
1,102,037 |
Total |
|
80,015 |
|
4,829,531 |
4,909,546 |
|
6,822 |
|
3,775,685 |
3,782,507 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current liabilities |
|||||||||||||||||||||
Borrowings and financing |
10 |
|
|
|
|
|
|
|
24,240,656 |
|
24,240,656 |
|
|
|
|
|
|
|
25,189,574 |
|
25,189,574 |
Derivative financial instruments |
11 and 12 |
19,808 |
19,808 |
17,375 |
17,375 | ||||||||||||||||
Total |
|
|
|
|
19,808 |
|
|
|
24,240,656 |
|
24,260,464 |
|
|
|
17,375 |
|
|
|
25,189,574 |
|
25,206,949 |
Total liabilities |
|
|
|
|
99,823 |
|
|
|
29,070,187 |
|
29,170,010 |
|
|
|
24,197 |
|
|
|
28,965,259 |
|
28,989,456 |
PAGE 43 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
· Fair value measurement
The following table shows the financial instruments recognized at fair value through profit or loss using a valuation method:
Consolidated |
3/31/2014 |
12/31/2013 | ||||||||||||||
Level 1 |
Level 2 |
Level 3 |
Balances |
Level 1 |
Level 2 |
Level 3 |
Balances | |||||||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets |
||||||||||||||||
Financial assets at fair value through profit or loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative financial instruments |
3,030 |
3,030 |
9,681 |
9,681 | ||||||||||||
Trading securities |
|
9,111 |
|
|
|
|
|
9,111 |
|
9,906 |
|
|
|
|
|
9,906 |
Non-current assets |
||||||||||||||||
Available-for-sale financial assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments |
1,756,395 |
1,756,395 |
2,405,174 |
2,405,174 | ||||||||||||
Financial assets at fair value through profit or loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative financial instruments |
3,879 |
3,879 | ||||||||||||||
Total assets |
|
1,765,506 |
|
3,030 |
|
|
|
1,768,536 |
|
2,415,080 |
|
13,560 |
|
|
|
2,428,640 |
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities |
||||||||||||||||
Financial liabilities at fair value through profit or loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative financial instruments |
80,015 |
80,015 |
6,822 |
6,822 | ||||||||||||
Non-current liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial liabilities at fair value through profit or loss |
||||||||||||||||
Derivative financial instruments |
|
|
|
19,808 |
|
|
|
19,808 |
|
|
|
17,375 |
|
|
|
17,375 |
Total liabilities |
|
99,823 |
|
99,823 |
|
24,197 |
|
24,197 |
II – Investments in financial instruments classified as available for sale and measured at fair value through OCI
These consist mainly of investments in shares acquired in Brazil involving top ranked companies, which are recognized in non-current assets, and any gains or losses are recognized in shareholders' equity, where they will remain until actual realization of the securities or when any loss is considered unrecoverable.
Potential impairment of financial assets classified as available for sale
The Company has investments in common (USIM3) and preferred (USIM5) shares (“Usiminas Shares”), designated as available-for-sale financial assets as they do not meet the criteria to be classified within any of the other categories of financial instruments (loans and receivables, held-to-maturity investments or financial assets at fair value through profit or loss). The asset is classified as a non-current asset under line item “investments” and is carried at fair value based on the quoted price on the stock exchange (BM&FBOVESPA).
Considering the volatility of the quotations of Usiminas shares, the Company evaluated whether, at the end of the reporting period, there was objective evidence of impairment of these financial assets, i.e., the Company’s management evaluated if the decline in the market value of Usiminas shares should be considered either significant or prolonged. In turn, this valuation requires judgment based on CSN’s policy, prepared according to practices used in the domestic and international markets, and consists of an instrument by instrument analysis based on quantitative and qualitative information available in the market, from the time an instrument shows a drop of 20% or more in its market value or from the time there is a significant drop in its market value as compared to its acquisition price during more than twelve months.
Based on the qualitative and quantitative elements, management concluded, in its best judgment, that there was evidence of a significant impairment of the investment in Usiminas shares as of June 30, 2012, and, consequently, reclassified the accumulated losses recorded in other comprehensive income amounting to R$1,599,485, net of income tax and social contribution, to profit for the year, by recognizing R$2,022,793 in other operating expenses and R$423,308 in deferred taxes.
In December 2012 there was an additional recognition of R$264,441 related to deferred taxes on accumulated losses due to the annual analysis of the effective income tax and social contribution rate that took into consideration the temporary differences generated by this investment in CSN subsidiaries resulting from the reclassification of accumulated losses.
PAGE 44 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
However, as of June 30, 2013, there was an additional decline in the quotation of the common shares (USIM3) as compared with the quotation as of June 30, 2012 which, according to the Company's accounting policy, generated a loss of R$5,002, recorded directly in other operating expenses. Beginning this date, pursuant to a Company's policy, gains and losses arising from the variation of the quotation of shares were recognized in other comprehensive income.
The Company continues to evaluate strategic alternatives with respect to its investment in Usiminas. These initiatives can, for example, affect the way an investment is recorded in the Company’s financial statements.
III – Fair values of assets and liabilities as compared to their carrying amounts
The estimated fair values of consolidated long-term borrowings and financing were calculated at prevailing market rates, taking into consideration the nature, terms and risks similar to those of the recorded contracts, as compared below:
|
|
3/31/2014 |
|
|
12/31/2013 | ||
Carrying amount |
|
Carrying amount |
Fair value | ||||
Perpetual bonds |
2,266,080 |
|
1,961,491 |
|
2,345,789 |
|
1,938,780 |
Fixed Rate Notes |
5,373,657 |
|
5,585,874 |
|
5,661,978 |
|
6,032,207 |
IV Financial risk management policy
As of March 31, 2014, there were no changes in the financial risk management policies in relation to those disclosed in the Company's financial statements for the year ended December 31, 2013.
· Foreign exchange exposure
The consolidated net exposure as of March 31, 2014 is as follows.
|
|
|
|
3/31/2014 |
Foreign Exchange Exposure |
(Amounts in US$’000) |
(Amounts in €’000) | ||
Cash and cash equivalents overseas |
|
4,162,341 |
|
2,751 |
Trade receivables - foreign market |
209,772 |
32,562 | ||
Related parties borrowings |
|
238 |
|
54,034 |
Other assets |
154,532 |
78,417 | ||
Total assets |
|
4,526,883 |
|
167,764 |
Borrowings and financing |
-4,766,934 |
-119,865 | ||
Trade payables |
|
-127,691 |
|
-7,624 |
Other liabilities |
-4,437 |
-18,947 | ||
Related parties borrowings |
|
-34,532 |
|
|
Total liabilities |
-4,933,594 |
-146,436 | ||
Gross exposure |
|
-406,711 |
|
21,328 |
Notional amount of derivatives contracted (*) |
813,000 |
-90,000 | ||
Net exposure |
|
406,289 |
|
-68,672 |
(*) Of the USD 813,000 of the notional amount informed in the table above, USD 100,000 have financial settlement on 4/01/2014, based on the PTAX of 3/31/2014.
PAGE 45 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
· Exchange swap transactions
|
|
|
|
3/31/2014 |
|
|
|
|
12/31/2013 |
3/31/2014 | ||||||||||||
Appreciation (R$) |
Fair value (market) |
Appreciation (R$) |
Fair value (market) |
Impact on finance income (cost) in 2014 | ||||||||||||||||||
Counterparties |
Transaction maturity |
Functional currency |
Notional amount |
Asset position |
Liability position |
Amounts receivable/ (payable) |
Notional amount |
Asset position |
Liability position |
Amounts receivable/ (payable) |
||||||||||||
Santander |
|
01/02/15 |
|
US dollar |
|
10,000 |
|
25,742 |
|
-23,176 |
|
2,566 |
|
10,000 |
|
26,512 |
|
-22,633 |
|
3,879 |
|
-1,313 |
Goldman Sachs |
04/01/14 |
US dollar |
10,000 |
22,771 |
-23,346 |
-575 |
10,000 |
23,697 |
-22,799 |
898 |
-1,473 | |||||||||||
HSBC |
|
04/01/14 |
|
US dollar |
|
90,000 |
|
204,982 |
|
-210,092 |
|
-5,110 |
|
90,000 |
|
213,306 |
|
-205,171 |
|
8,135 |
|
-13,245 |
Deutsche |
11/10/14 |
US dollar |
20,000 |
45,562 |
-48,303 |
-2,741 |
-2,741 | |||||||||||||||
Total dollar-to-CDI swap |
|
|
|
130,000 |
|
299,057 |
|
-304,917 |
|
-5,860 |
|
110,000 |
|
263,515 |
|
-250,603 |
|
12,912 |
|
-18,772 | ||
Itaú BBA |
|
05/07/14 to 01/30/15 |
|
US dollar |
|
165,000 |
|
373,295 |
|
-394,210 |
|
-20,915 |
|
60,000 |
|
141,019 |
|
-141,359 |
|
-340 |
|
-22,177 |
Itaú BBA |
10/01/14 |
US dollar |
80,000 |
180,537 |
-180,291 |
246 |
25,000 |
58,734 |
-58,485 |
249 |
-3 | |||||||||||
HSBC |
|
05/07/14 to 01/30/15 |
|
US dollar |
|
338,000 |
|
763,619 |
|
-807,217 |
|
-43,598 |
|
153,000 |
|
359,599 |
|
-360,487 |
|
-888 |
|
-42,710 |
HSBC |
10/01/14 |
US dollar |
20,000 |
45,134 |
-45,108 |
26 |
55,000 |
129,244 |
-128,862 |
382 |
-356 | |||||||||||
Deutsche |
|
06/05/14 to 01/30/151 |
|
US dollar |
|
40,000 |
|
90,179 |
|
-94,824 |
|
-4,645 |
|
|
|
|
|
|
|
|
|
-6,309 |
Deutsche |
10/01/14 |
US dollar |
40,000 |
90,269 |
-90,077 |
192 |
192 | |||||||||||||||
Total dollar-to-real swap (NDF) |
|
|
|
683,000 |
|
1,543,033 |
|
-1,611,727 |
|
-68,694 |
|
293,000 |
|
688,596 |
|
-689,193 |
|
-597 |
|
-71,363 | ||
Itaú BBA |
|
05/23/2014 |
|
Euro |
|
30,000 |
|
92,976 |
|
-93,525 |
|
-549 |
|
30,000 |
|
94,858 |
|
-96,632 |
|
-1,774 |
|
-164 |
HSBC |
05/23/2014 |
Euro |
60,000 |
185,952 |
-187,050 |
-1,098 |
30,000 |
94,900 |
-96,632 |
-1,732 |
-735 | |||||||||||
Goldman Sachs |
|
|
|
Euro |
|
|
|
|
|
|
|
|
|
30,000 |
|
94,880 |
|
-96,632 |
|
-1,752 |
|
342 |
Total dollar-to-euro swap (NDF) |
90,000 |
278,928 |
-280,575 |
-1,647 |
90,000 |
284,638 |
-289,896 |
-5,258 |
-557 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BES |
04/09/14 to 09/28/14 |
US dollar |
26,851 |
60,710 |
-61,155 |
-445 |
11,801 |
27,878 |
-27,861 |
17 |
-485 | |||||||||||
Total dollar-to-euro swap |
|
|
|
26,851 |
|
60,710 |
|
-61,155 |
|
-445 |
|
11,801 |
|
27,878 |
|
-27,861 |
|
17 |
|
-485 | ||
CSFB |
|
05/12/14 |
|
US dollar |
|
21,500 |
|
36,520 |
|
-36,859 |
|
-339 |
|
21,500 |
|
36,526 |
|
-36,862 |
|
-336 |
|
-636 |
Total LIBOR-to-CDI interest rate swap |
21,500 |
36,520 |
-36,859 |
-339 |
21,500 |
36,526 |
-36,862 |
-336 |
-636 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Itaú BBA |
03/01/16 |
Real |
150,000 |
155,652 |
-163,814 |
-8,162 |
150,000 |
152,610 |
-159,712 |
-7,102 |
-1,060 | |||||||||||
HSBC |
|
02/05/16 to 03/01/16 |
|
Real |
|
185,000 |
|
191,085 |
|
-202,167 |
|
-11,082 |
|
185,000 |
|
187,395 |
|
-197,157 |
|
-9,762 |
|
-1,320 |
Deutsche Bank |
03/01/16 |
Real |
10,000 |
10,316 |
-10,880 |
-564 |
10,000 |
10,114 |
-10,625 |
-511 |
-53 | |||||||||||
Fixed rate-to-CDI interest rate swap |
|
|
|
345,000 |
|
357,053 |
|
-376,861 |
|
-19,808 |
|
345,000 |
|
350,119 |
|
-367,494 |
|
-17,375 |
|
-2,433 | ||
|
|
|
|
2,575,301 |
|
-2,672,094 |
|
-96,793 |
|
|
|
1,651,272 |
|
-1,661,909 |
|
-10,637 |
|
-94,246 |
· Classification of the derivatives in the balance sheet and statement of income
|
|
|
|
|
|
|
|
|
|
|
3/31/2014 | |||
Instruments |
Assets |
Liabilities |
|
Finance income (costs), net (Note 23) | ||||||||||
Current |
Non-current |
Total |
Current |
Non-current |
Total |
|||||||||
CDI-to-dollar swap |
|
2,566 |
|
|
|
2,566 |
|
8,426 |
|
|
|
8,426 |
|
-18,772 |
Dollar-to-real swap (NDF) |
464 |
464 |
69,158 |
69,158 |
-71,363 | |||||||||
Dollar-to-euro swap (NDF) |
|
|
|
|
|
|
|
1,647 |
|
|
|
1,647 |
|
-557 |
Dollar-to-real swap |
445 |
445 |
-485 | |||||||||||
Libor-to-CDI swap |
|
|
|
|
|
|
|
339 |
|
|
|
339 |
|
-636 |
Fixed rate-to-CDI swap |
19,808 |
19,808 |
-2,433 | |||||||||||
|
|
3,030 |
|
|
|
3,030 |
|
80,015 |
|
19,808 |
|
99,823 |
|
-94,246 |
12/31/2013 |
3/31/2013 | |||||||||||||
Instruments |
Assets |
Liabilities |
|
Finance income (costs), net (Note 23) | ||||||||||
Current |
Non-current |
Total |
Current |
Non-current |
Total |
|||||||||
CDI-to-dollar swap |
|
9,033 |
|
3,879 |
|
12,912 |
|
|
|
|
|
|
|
-633 |
Dollar-to-real swap (NDF) |
631 |
631 |
1,228 |
1,228 |
||||||||||
Dollar-to-euro swap (NDF) |
|
|
|
|
|
|
|
5,258 |
|
|
|
5,258 |
|
5,396 |
Yen-to-dollar swap (*) |
-8 | |||||||||||||
Dollar-to-euro swap |
|
17 |
|
|
|
17 |
|
|
|
|
|
|
|
3,478 |
Libor-to-CDI swap |
336 |
336 |
-1,197 | |||||||||||
Fixed rate-to-CDI swap |
|
|
|
|
|
|
|
|
|
17,375 |
|
17,375 |
|
-1,166 |
9,681 |
3,879 |
13,560 |
6,822 |
17,375 |
24,197 |
5,870 | ||||||||
(*) The positions of the swap transactions were settled in December 2013, together with their guarantee deposit.
PAGE 46 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
||
ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
· Sensitivity analysis of exchange rate swaps
The Company considered scenarios 1 and 2 as 25% and 50% of appreciation for volatility of the currency, using as reference the closing exchange rate as of March 31, 2014 for dollar-to-real exchange swap R$2.2630, and for dollar-to-euro exchange swap R$1.3776.
Instruments |
Notional amount |
|
Risk |
|
Probable scenario (*) |
|
Scenario 1 |
|
Scenario 2 | |
Dollar-to-CDI exchange swap |
|
130,000 |
|
Dólar |
|
5,860 |
|
-73,548 |
|
-147,095 |
Dollar-to-real exchange swap (NDF) |
|
683,000 |
|
Dólar |
|
68,694 |
|
-386,407 |
|
-772,815 |
Dollar-to-euro exchange swap (NDF) |
|
-90,000 |
|
Euro |
|
1,647 |
|
70,144 |
|
140,288 |
Dollar-to-euro exchange swap (NDF) |
|
26,851 |
|
Dólar |
|
445 |
|
-28,828 |
|
-57,658 |
(*) The sensitivity analysis is based on the assumption of maintaining, as a probable scenario, the market values as of March 31, 2014 recognized in the company's assets and liabilities.
· Sensitivity analysis of interest rate swaps
The Company considered scenarios 1, 2, 3 and 4 as 25% and 50% of appreciation and devaluation for volatility of the interest as of March 31, 2014.
3/31/2014 | ||||||||||||
Instruments |
Notional amount |
Risk |
Scenario 1 |
Scenario 2 |
Scenario 3 |
Scenario 4 | ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
LIBOR-to-CDI interest rate swap |
21,500 |
(Libor) US$ |
-5,224 |
-6,227 |
5,224 |
6,227 | ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed rate-to-CDI interest rate swap |
345,000 |
CDI |
-14,792 |
-23,891 |
3,407 |
12,506 |
· Sensitivity analysis of changes in interest rates
The Company considers the effects of a 5% increase or decrease in interest rates on its outstanding borrowings, financing and debentures as of March 31, 2014 in the consolidated interim financial statements.
Impact on profit or loss | ||||||
Changes in interest rates |
% p.a |
3/31/2014 |
|
12/31/2013 | ||
TJLP |
|
5.00 |
|
2,391 |
|
2,521 |
Libor |
0.33 |
6,196 |
5,725 | |||
CDI |
|
10.55 |
|
76,265 |
|
71,507 |
· Share market price risks
The Company is exposed to the risk of changes in equity prices due to the investments made and classified as available-for-sale. Equity investments refer to blue chips traded on BM&F BOVESPA.
PAGE 47 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
The following table shows the impact of the net changes in the market value of financial instruments classified as available-for-sale on shareholders' equity, in other comprehensive income.
Consolidated | ||||||
Other comprehensive income | ||||||
3/31/2014 |
|
12/31/2013 |
|
Net change | ||
Net change in available-for-sale financial assets |
|
351,331 |
|
779,526 |
|
-428,195 |
The Company considers as probable scenario the amounts recognized at market values as of March 31, 2014. Sensitivity analysis is based on the assumption of maintaining as probable scenario the market values as of March 31, 2014. Therefore, there is no impact on the financial instruments classified as available for sale already presented above. The Company considered scenarios 1 and 2 as 25% and 50% of appreciation for volatility of the shares.
|
Impact on equity | |||||
Companies |
Probable |
Scenario 1 |
Scenario 2 | |||
Usiminas |
|
345,503 |
|
199,711 |
|
399,421 |
Panatlântica |
5,828 |
3,426 |
6,852 | |||
|
|
351,331 |
|
203,137 |
|
406,273 |
· Liquidity risk
|
|
|
|
|
|
|
|
Consolidated | |
At March 31, 2014 |
Less than one year |
From one to two years |
From two to five years |
Over five years |
|
Total | |||
Borrowings, financing and debentures |
3,489,415 |
|
4,396,446 |
|
12,426,200 |
|
7,418,010 |
|
27,730,071 |
Derivative financial instruments |
80,015 |
|
19,808 |
|
|
|
|
|
99,823 |
Trade payables |
1,340,116 |
|
|
|
|
|
|
|
1,340,116 |
|
|
|
|
|
|
|
|
|
|
At December 31, 2013 |
|
|
|
|
|
|
|
|
|
Borrowings, financing and debentures |
2,673,648 |
|
6,391,523 |
|
11,439,993 |
|
7,358,058 |
|
27,863,222 |
Derivative financial instruments |
6,822 |
|
17,375 |
|
|
|
|
|
24,197 |
Trade payables |
1,102,037 |
|
|
|
|
|
|
|
1,102,037 |
PAGE 48 of 70
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Version: 1 |
12. OTHER PAYABLES
The group of other payables classified in current and non-current liabilities is comprised as follows:
|
|
|
|
|
|
|
Consolidated |
|
|
|
|
|
|
|
Parent Company |
|
Current |
Non-current |
|
Current |
|
Non-current | |||||||||
3/31/2014 |
12/31/2013 |
3/31/2014 |
12/31/2013 |
|
3/31/2014 |
12/31/2013 |
3/31/2014 |
12/31/2013 | |||||||
Payables to related parties (Note 17 b) |
430,309 |
|
422,150 |
|
8,653,220 |
|
8,522,685 |
|
685,265 |
|
735,880 |
|
9,012,777 |
|
8,873,825 |
Derivative financial instruments (Note 11 I) |
80,015 |
|
6,822 |
|
19,808 |
|
17,375 |
|
339 |
|
336 |
|
|
|
|
Dividends and interest on capital payable non-controlling shareholders |
2,165 |
|
2,036 |
|
|
|
|
|
2,165 |
|
2,036 |
|
|
|
|
Advances from customers |
29,692 |
28,213 |
20,402 |
17,501 |
|||||||||||
Taxes in installments (Note 14) |
244,608 |
|
247,387 |
|
1,430,941 |
|
1,454,838 |
|
215,703 |
|
218,667 |
|
1,275,572 |
|
1,294,666 |
Profit sharing - employees |
154,360 |
121,631 |
140,495 |
113,039 |
|||||||||||
Other payables |
103,738 |
|
144,612 |
|
59,758 |
|
66,673 |
|
25,296 |
|
51,497 |
|
74,109 |
|
5,241 |
1,044,887 |
972,851 |
10,163,727 |
10,061,571 |
1,089,665 |
1,138,956 |
10,362,458 |
10,173,732 |
13. INCOME TAX AND SOCIAL CONTRIBUTION
The information related to income tax and social contribution did not have significant changes in relation to that disclosed in the Company's financial statements as of December 31, 2013 and, accordingly, the Company decided not to repeat it fully in the condensed interim financial statements as of March 31, 2014.
(a) Income tax and social contribution recognized in profit or loss:
The income tax and social contribution recognized in profit or loss for the period are as follows:
Consolidated |
Parent Company | ||||||
3/31/2014 |
|
3/31/2013 |
3/31/2014 |
|
3/31/2013 | ||
Income tax and social contribution (expenses) income |
|
|
|
|
|
|
|
Current |
-124,011 |
|
-77,835 |
|
-11,717 |
||
Deferred |
96,856 |
|
219,813 |
|
99,430 |
|
217,504 |
|
-27,155 |
|
141,978 |
|
87,713 |
|
217,504 |
The reconciliation of Company and consolidated income tax and social contribution expenses and income and the result from applying the effective rate on profit before income tax (IRPJ) and social contribution (CSLL) are as follows:
Consolidated |
Parent Company | ||||||
3/31/2014 |
|
3/31/2013 |
3/31/2014 |
|
3/31/2013 | ||
Profit (loss) before income tax and social contribution |
79,251 |
|
-125,662 |
|
-32,379 |
|
-190,178 |
Tax rate |
34% |
34% |
34% |
34% | |||
Income tax and social contribution at combined statutory rate |
-26,945 |
|
42,725 |
|
11,009 |
|
64,661 |
Adjustment to reflect effective rate: |
|||||||
Interest on capital benefit |
|
|
190,400 |
|
|
|
190,400 |
Share of profits of investees |
76,733 |
-38,241 | |||||
Income subject to special tax rates or untaxed |
5,154 |
|
-83,214 |
|
|
|
|
Transfer pricing adjustment |
-4,926 |
-4,926 |
|||||
Tax loss carryforwards without recognizing deferred taxes |
-4,820 |
|
-11,648 |
|
|
|
|
Other permanent deductions (add-backs) |
4,382 |
3,715 |
4,897 |
684 | |||
Income tax and social contribution in profit for the period |
-27,155 |
|
141,978 |
|
87,713 |
|
217,504 |
Effective tax rate |
34% |
-113% |
271% |
-114% |
PAGE 49 of 70
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(b) Deferred income tax and social contribution:
The deferred income tax and social contribution are calculated on income tax and social contribution loss carryforwards and related temporary differences between the tax bases of assets and liabilities and the accounting balances of the interim financial statements. They are presented at net amounts when related to a sole jurisdiction.
Consolidated | ||||||||
Opening |
|
Movement |
Closing | |||||
12/31/2013 |
Comprehensive |
|
Profit or |
|
3/31/2014 | |||
Deferred tax assets |
|
|
|
|
|
|
|
|
Income tax loss carryforwards |
1,132,296 |
|
-6,523 |
|
-20,991 |
|
1,104,782 | |
Social contribution loss carryforwards |
|
389,306 |
|
|
|
-1,947 |
|
387,359 |
Temporary differences |
1,248,925 |
224,784 |
113,199 |
1,586,908 | ||||
- Provision for tax, social security, labor, civil and environmental risks |
|
207,507 |
|
|
|
25,560 |
|
233,067 |
- Provision for environmental liabilities |
117,795 |
-4,074 |
113,721 | |||||
- Asset impairment losses |
|
53,450 |
|
|
|
5,729 |
|
59,179 |
- Inventory impairment losses |
28,556 |
5,123 |
33,679 | |||||
- (Gains) losses on financial instruments |
|
-4,722 |
|
|
|
3,551 |
|
-1,171 |
- (Gains) losses on available-for-sale financial assets |
287,876 |
220,585 |
508,461 | |||||
- Actuarial liability (pension and healthcare plan) |
|
131,938 |
|
|
|
|
|
131,938 |
- Accrued supplies and services |
91,807 |
-3,711 |
88,096 | |||||
- Estimated losses on doubtful debts |
|
27,749 |
|
|
|
582 |
|
28,331 |
- Goodwill on merger |
-123,172 |
4,199 |
-1,055 |
-120,028 | ||||
- Unrealized exchange differences (*) |
|
546,041 |
|
|
|
60,581 |
|
606,622 |
- (Gain) on loss of control over Transnordestina |
-224,096 |
-224,096 | ||||||
- Other |
|
108,196 |
|
|
|
20,913 |
|
129,109 |
Non-current assets |
2,770,527 |
218,261 |
90,261 |
3,079,049 | ||||
Deferred tax liabilities |
|
|
|
|
|
|
|
|
- Business combination |
252,109 |
-7,912 |
-7,450 |
236,747 | ||||
- Other |
|
16,724 |
|
-559 |
|
855 |
|
17,020 |
Non-current liabilities |
268,833 |
-8,471 |
-6,595 |
253,767 |
Parent Company | |||||||
Opening |
|
Movement |
|
Closing balance | |||
12/31/2013 |
Comprehensive |
|
Profit |
3/31/2014 | |||
Deferred tax assets |
|
|
|
|
|
|
|
Income tax loss carryforwards |
919,910 |
|
|
|
-5,482 |
|
914,428 |
Social contribution loss carryforwards |
389,306 |
|
|
|
-1,947 |
|
387,359 |
Temporary differences |
1,303,782 |
|
214,541 |
|
106,859 |
|
1,625,182 |
- Provision for tax, social security, labor, civil and environmental risks |
199,445 |
|
|
|
24,729 |
|
224,174 |
- Provision for environmental liabilities |
117,795 |
-4,074 |
113,721 | ||||
- Asset impairment losses |
47,087 |
|
|
|
5,729 |
|
52,816 |
- Inventory impairment losses |
28,365 |
4,972 |
33,337 | ||||
- (Gains) losses on financial instruments |
-3,875 |
|
|
|
3,453 |
|
-422 |
- (Gains) losses on available-for-sale financial assets |
264,172 |
214,541 |
478,713 | ||||
- Actuarial liability (pension and healthcare plan) |
132,063 |
|
|
|
|
|
132,063 |
- Accrued supplies and services |
89,767 |
-3,924 |
85,843 | ||||
- Estimated losses on doubtful debts |
26,179 |
|
|
|
434 |
|
26,613 |
- Unrealized exchange differences (*) |
546,041 |
60,581 |
606,622 | ||||
- (Gain) on loss of control over Transnordestina |
-224,096 |
|
|
|
|
|
-224,096 |
- Other |
80,839 |
|
14,959 |
95,798 | |||
Non-current assets |
2,612,998 |
|
214,541 |
|
99,430 |
|
2,926,969 |
(*) The Company taxes foreign exchange differences on a cash basis to calculate income tax and social contribution.
PAGE 50 of 70
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Some Group companies recognized tax credits on income tax and social contribution loss carryforwards not subject to statute of limitations and based on the history of profitability and expected future taxable profits determined in technical studies approved by Management.
Since they are subject to significant factors that may change the projections for realization, the carrying amounts of deferred tax assets and projections are reviewed annually. These studies indicate the realization of these tax assets within the term stipulated by the mentioned instruction and the limit of 30% of the taxable profit.
Certain Group companies have tax assets amounting to R$177,446 and R$24,349, related to income tax and social contribution loss carryforwards, for which no deferred taxes were set up, of which R$35,829 expire in 2015, R$10,611 in 2018 and R$56,537 in 2025. The remaining tax assets refer to domestic companies and, therefore, are not subject to statute of limitations.
The Company’s corporate structure includes foreign subsidiaries whose profits are subject to income tax levied by the related countries, recognized at tax rates lower than in Brazil.
For the years from 2010 to 2014 these subsidiaries generated profits amounting to R$4,031,024, which tax authorities may understand that have already been distributed, hence, it would be subject to additional taxation in Brazil, in the approximate amount of R$1,300,000. The Company, based on its legal counsel's opinion, assessed the likelihood of loss in a potential challenge by tax authorities as possible and, therefore, no provision was recognized in the condensed interim financial statements.
(c) Income tax and social contribution recognized in shareholders' equity:
The income tax and social contribution recognized directly in shareholders' equity are as follows:
Consolidated |
|
Parent Company | |||||
3/31/2014 |
|
12/31/2013 |
|
3/31/2014 |
|
12/31/2013 | |
Income tax and social contribution |
|
|
|
|
|
|
|
Actuarial gains on defined benefit pension plan |
33,012 |
|
33,012 |
|
32,876 |
|
32,876 |
Changes in the fair value on available-for-sale financial assets |
-180,989 |
|
-401,574 |
|
-178,033 |
|
-392,574 |
Exchange differences on translating foreign operations |
-425,510 |
|
-425,510 |
|
-425,510 |
|
-425,510 |
|
-573,487 |
|
-794,072 |
|
-570,667 |
|
-785,208 |
14. TAXES IN INSTALLMENTS
The information related to taxes in installments did not have significant changes in relation to that disclosed in the Company's financial statements as of December 31, 2013 and, accordingly, the Company decided not to repeat it fully in the condensed interim financial statements as of March 31, 2014.
The position of the debts arising from these tax installment plans, recorded in taxes in installments in current and non-current liabilities, is as follows:
|
|
|
|
|
|
|
Consolidated |
|
|
|
|
|
|
|
Parent Company |
|
Current |
Non-current |
|
Current |
|
Non-current | |||||||||
3/31/2014 |
|
12/31/2013 |
3/31/2014 |
|
12/31/2013 |
|
3/31/2014 |
12/31/2013 |
3/31/2014 |
12/31/2013 | |||||
Federal REFIS Law 11,941/09 (a) |
142,788 |
|
140,446 |
|
991,203 |
|
1,001,630 |
|
123,414 |
|
121,399 |
|
837,459 |
|
845,838 |
Federal REFIS Law 12,865/13 (a) |
28,312 |
27,124 |
386,395 |
384,872 |
28,446 |
27,167 |
386,395 |
384,872 | |||||||
Other taxes in installments (b) |
73,508 |
|
79,817 |
|
53,343 |
|
68,336 |
|
63,843 |
|
70,101 |
|
51,718 |
|
63,956 |
244,608 |
247,387 |
1,430,941 |
1,454,838 |
215,703 |
218,667 |
1,275,572 |
1,294,666 |
PAGE 51 of 70
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Version: 1 |
a) Tax Recovery Program (Federal Refis) – Law 11,941/09 and Law 12,865/13
· New deadline – Law 11,941/09
On November 26, 2009, the Group companies joined the Tax Recovery Programs established by Law 11,941/09 and Provisional Act 470/2009, aimed at settling tax liabilities through a special payment system and installment plan for the settlement of tax and social security obligations.
With the new deadline to join the Law 11,941/09 tax installment program established by the RFB/PGFN, pursuant to Law 12,865/13, the Company analyzed with its legal counsel the lawsuits that could have changed or be subject to new jurisprudence, the Company concluded that some tax debts could be included in the new tax installment plan on December 27, 2013. After the analysis, the Company concluded that there were debts that could be included in the program and applied for installment payment on December 27, 2013.
· Overseas profits – Law 12,865/13
Under Article 40 of Law 12,865/13, the federal government allowed the payment in installments of income tax and social contribution arising from the application of Article 74 of Provisional Act 2158-35/2001, the so-called overseas profits, which requires that profits earned by foreign subsidiaries or associates be taxed at year end.
The Company elected to join the amounts corresponding to the assessed period (2004-2009), on November 29, 2013.
Both programs provide for reductions in fines and interest, however, only income tax and social contribution debt arising from the application of Law 12,865/12 could be settled with tax credits claimed on tax loss carryforwards of subsidiaries and the parent company. The tax credit utilized by the subsidiaries total R$565,273, of which R$550,270 did not have a recognized tax credit.
The remaining balance was divided into 179 monthly installments adjusted by the SELIC and the amount determined pursuant to Laws 11,941/09 and 1,2865/13 is subject to approval by the tax authorities.
b) Other tax installments (regular and other)
The Group companies also joined the Regular social security tax (INSS) installment plan and other plans.
PAGE 52 of 70
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15. PROVISION FOR TAX, SOCIAL SECURITY, LABOR, CIVIL AND ENVIRONMENTAL RISKS AND JUDICIAL DEPOSITS
As of March 31, 2014, the information related to judicial deposits and proceedings did not have significant changes in relation to that disclosed in the Company's financial statements as of December 31, 2013.
Details of the accrued amounts and related judicial deposits are as follows:
|
|
|
|
|
|
|
|
Consolidated |
|
|
|
|
|
|
|
Parent Company |
|
|
|
|
3/31/2014 |
|
|
|
12/31/2013 |
|
|
|
3/31/2014 |
|
|
|
12/31/2013 |
|
|
Accrued liabilities |
|
Judicial deposits |
|
Accrued liabilities |
Judicial deposits |
|
Accrued liabilities |
|
Judicial deposits |
|
Accrued liabilities |
Judicial deposits | ||
Tax |
|
278,314 |
|
86,686 |
|
259,725 |
|
87,391 |
|
238,327 |
|
75,672 |
|
218,899 |
|
75,672 |
Social security and labor |
347,399 |
139,788 |
298,637 |
138,911 |
|
300,949 |
115,839 |
254,116 |
115,579 | |||||||
Civil |
|
90,509 |
|
25,127 |
|
82,143 |
|
29,022 |
|
74,388 |
|
20,858 |
|
65,667 |
|
24,614 |
Environmental |
1,756 |
961 |
4,262 |
961 |
|
1,756 |
892 |
4,262 |
892 | |||||||
Escrow deposits |
|
|
|
8,872 |
|
|
|
8,935 |
|
|
|
5,274 |
|
|
|
5,212 |
717,978 |
261,434 |
644,767 |
265,220 |
|
615,420 |
218,535 |
542,944 |
221,969 | ||||||||
Legal obligations challenged in courts: |
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Tax |
|
|||||||||||||||
Education salary premium |
|
46,193 |
|
46,193 |
|
46,193 |
|
46,193 |
|
46,193 |
|
46,193 |
|
46,193 |
|
46,193 |
Income tax/”Verão” plan |
20,892 |
372,452 |
20,892 |
366,951 |
20,892 |
372,452 |
20,892 |
366,951 | ||||||||
Other provisions |
|
102,438 |
|
15,350 |
|
101,331 |
|
15,350 |
|
102,438 |
|
15,350 |
|
101,331 |
|
15,350 |
169,523 |
433,995 |
168,416 |
428,494 |
169,523 |
433,995 |
168,416 |
428,494 | |||||||||
|
|
887,501 |
|
695,429 |
|
813,183 |
|
693,714 |
|
784,943 |
|
652,530 |
|
711,360 |
|
650,463 |
The changes in the provisions for tax, social security, labor, civil and environmental risks in the period ended March 31, 2014 were as follows:
Consolidated | ||||||||||
|
|
|
|
|
|
|
|
|
|
Current + Non-current |
Nature |
12/31/2013 |
Additions |
Net adjustment |
Net utilization of reversal |
3/31/2014 | |||||
Tax |
|
428,141 |
|
|
|
20,897 |
|
-1,201 |
|
447,837 |
Social security |
47,261 |
12,197 |
1,120 |
60,578 | ||||||
Labor |
|
251,376 |
|
52,056 |
|
5,050 |
|
-21,661 |
|
286,821 |
Civil |
82,143 |
4,091 |
8,123 |
-3,848 |
90,509 | |||||
Environmental |
|
4,262 |
|
|
|
288 |
|
-2,794 |
|
1,756 |
813,183 |
68,344 |
35,478 |
-29,504 |
887,501 |
Parent Company | ||||||||||
|
|
|
|
|
|
|
|
|
|
Current + Non-current |
Nature |
12/31/2013 |
Additions |
Net adjustment |
Net utilization of reversal |
3/31/2014 | |||||
Tax |
|
387,315 |
|
|
|
20,703 |
|
-168 |
|
407,850 |
Social security |
46,537 |
12,197 |
1,106 |
59,840 | ||||||
Labor |
|
207,579 |
|
50,191 |
|
3,320 |
|
-19,981 |
|
241,109 |
Civil |
65,667 |
3,880 |
7,543 |
-2,702 |
74,388 | |||||
Environmental |
|
4,262 |
|
|
|
288 |
|
-2,794 |
|
1,756 |
711,360 |
66,268 |
32,960 |
-25,645 |
784,943 |
The provision for tax, social security, labor, civil and environmental liabilities was estimated by management and is mainly based on the legal counsel’s assessment. Only proceedings for which the risk is classified as probable loss are accrued. Moreover, this provision includes tax liabilities resulting from contingencies filed by the Company, subject to SELIC (Central Bank’s policy rate).
PAGE 53 of 70
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Version: 1 |
§ Other administrative and judicial proceedings
The Group is a defendant in other administrative and judicial proceedings (tax, social security, labor, civil, and environmental), in the approximate amount of R$12,688,667, of which
(a) R$6,654,445 refers to the tax assessment notice issued against the Company for an alleged sale of 40% of the shares of its subsidiary NAMISA to a Japanese-Korean consortium, thus failing to determine and pay taxes on the capital gain resulting from this transaction, and in May 2013, the São Paulo (SP) Regional Judgment Office (lower administrative court) issued a decision favorable to the Company and cancelled the tax assessment notice. In light of this decision, an ex-officio appeal was filed that will be judged by the Administrative Board of Tax Appeals (CARF).
(b) R$701,695 refers to tax foreclosures filed to require the Company to pay the ICMS, as liable party, allegedly due on the electricity purchased from a Generating Plant and fully consumed in the manufacturing of steel products. The tax auditors believe that the use of electricity in the production process does not exclude the Company responsibility for withholding ICMS levied on delivery of this input in the plant.
(c) R$547,557 refers to the offset of taxes that were not approved by the Federal Revenue Service for different reasons. The taxes involved are CSLL, IRPJ, IPI, PIS and COFINS. The analysis of the entire documentation evidences the right to claim credits and the right to file the offset requests, processed at the time.
(d) R$521,197 refers to the decision issued by the Federal Revenue Service that partially approved the request to pay debts in installments governed by Provisional Act 470/09, due to the insufficiency of tax loss carryforwards. When it consolidated the tax installment plan, the Federal Revenue Service considered the existing outstanding balance in the Inflationary Profit Tax Return (SAPLI) as the correct amount: however, this balance already included the adjustments to tax loss carryforwards as a result of the Overseas Profits tax assessment notice issued against the Company.
(e) R$460,669 refers to the disallowance of the ICMS credits claimed by the Company in the period 04/1999-07/2002 on the transfer of iron ore between the Casa de Pedra mine and the Presidente Vargas Plan. According to the tax auditors, the tax base used on the transfer under the Minas Gerais State Law is not accepted under the Rio de Janeiro State Law, reason why the difference was disallowed.
(f) R$260,321 refers to the disallowance of the ICMS credits on the acquisition of subsidiary INAL’s units located in the State of Rio de Janeiro. According to the tax auditors, the acquisition of a unit does not entitle an entity to claim ICMS credits. In light of these tax assessments, the Company filed for an injunction at the time and its right to change its State taxpayer master file was recognized, to state that the units acquired belong to CSN. This decision was favorable to the Company and can be applied in the judgment of our appeals by the Rio de Janeiro State Taxpayers Board.
(g) R$2,113,511 refers to other tax (federal, state, and municipal) lawsuits.
(h) R$973,226 refers to labor and social security lawsuits; R$407,173 refers to civil lawsuits, and R$48,873 refers to environmental lawsuits.
The assessments made by legal counsel define these administrative and judicial proceedings as entailing risk of possible loss and, therefore, no provision was recorded in conformity with Management’s judgment and accounting practices adopted in Brazil.
16. PROVISION FOR ENVIRONMENTAL LIABILITIES AND ASSET RETIREMENT OBLIGATION - ARO
PAGE 54 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
||
ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
The information related to provisions for environmental liabilities and asset retirement obligation - ARO did not have significant changes in relation to that disclosed in the Company's financial statements as of December 31, 2013.
The balance of the provision for environmental liabilities and asset retirement obligation - AROis as follows:
|
|
|
Consolidated |
|
|
|
Parent Company |
3/31/2014 |
|
12/31/2013 |
|
3/31/2014 |
|
12/31/2013 | |
Environmental liabilities |
334,477 |
|
346,455 |
|
334,477 |
|
346,455 |
Asset retirement obligation - ARO |
24,748 |
|
23,999 |
|
19,875 |
|
19,261 |
|
359,225 |
|
370,454 |
|
354,352 |
|
365,716 |
17. RELATED-PARTY BALANCES AND TRANSACTIONS
The information related to related-party transactions did not have significant changes in relation to that disclosed in the Company's financial statements as of December 31, 2013.
a) Transactions with Holding Company
· Liabilities
Companies |
|
Paid | ||
Dividends |
|
Interest on Capital | ||
Vicunha Siderurgia |
|
203,386 |
|
|
Rio Iaco |
16,963 |
|
| |
Total at 3/31/2014 |
|
220,349 |
|
|
Total at 12/31/2013 |
471,801 |
|
388,855 |
b) Transactions with subsidiaries, jointly controlled entities, associates, exclusive funds and other related parties
PAGE 55 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
· By transaction
Consolidated | ||||||
Current |
Non-current |
Total | ||||
Assets |
|
|
|
|
|
|
Trade receivables |
109,501 |
109,501 | ||||
Loans |
|
377,039 |
|
191,481 |
|
568,520 |
Dividends receivable |
31,571 |
31,571 | ||||
Actuarial asset |
|
|
|
97,051 |
|
97,051 |
Other receivables |
10,796 |
14,360 |
25,156 | |||
Total at 3/31/2014 |
|
528,907 |
|
302,892 |
|
831,799 |
Total at 12/31/2013 |
987,969 |
719,042 |
1,707,011 | |||
|
|
|
|
|
|
|
Liabilities |
||||||
Other payables |
|
|
|
|
|
|
Accounts payable |
446 |
546 |
992 | |||
Advances from customers |
|
429,863 |
|
8,652,674 |
|
9,082,537 |
Trade payables |
11,145 |
11,145 | ||||
Actuarial liability |
|
|
|
11,139 |
|
11,139 |
Total at 3/31/2014 |
441,454 |
8,664,359 |
9,105,813 | |||
Total at 12/31/2013 |
|
475,099 |
|
8,533,824 |
|
9,008,923 |
Statement of Income |
|
|||||
Revenues |
|
|
|
|||
Sales |
351,370 |
|||||
Interest |
|
11,066 |
|
|||
Expenses |
||||||
Purchases |
|
-285,052 |
|
|||
Interest |
-108,985 |
|||||
Total at 3/31/2014 |
|
-31,601 |
|
|||
Total at 3/31/2013 |
-77,447 |
· By company
PAGE 56 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Consolidated | ||||||||||||||||||||
Assets |
Liabilities |
Statement of Income | ||||||||||||||||||
Current |
Non-current |
Total |
Current |
Non-current |
Total |
Sales |
Purchases |
Finance income and costs, net |
Total | |||||||||||
Subsidiaries |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ferrovia Transnordestina Logística S.A. (1) |
45,419 |
62,886 |
108,305 |
|||||||||||||||||
|
|
45,419 |
|
62,886 |
|
108,305 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Jointly controlled entities |
||||||||||||||||||||
Nacional Minérios S.A. (2) |
|
378,736 |
|
38,471 |
|
417,207 |
|
430,308 |
|
8,653,220 |
|
9,083,528 |
|
91,090 |
|
-1,827 |
|
-103,446 |
|
-14,183 |
MRS Logística S.A. |
30,402 |
30,402 |
114 |
114 |
-178,265 |
-178,265 | ||||||||||||||
Transnordestina Logística S.A (3) |
|
6,698 |
|
92,980 |
|
99,678 |
|
4,919 |
|
|
|
4,919 |
|
|
|
|
|
5,114 |
|
5,114 |
CBSI - Companhia Brasileira de Serviços e Infraestrutura |
6,547 |
6,513 |
13,060 |
2,524 |
2,524 |
-36,452 |
-36,452 | |||||||||||||
CGPAR Construção Pesada S.A. |
|
3,884 |
|
4,618 |
|
8,502 |
|
3,385 |
|
|
|
3,385 |
|
|
|
-65,861 |
|
|
|
-65,861 |
426,267 |
142,582 |
568,849 |
441,250 |
8,653,220 |
9,094,470 |
91,090 |
-282,405 |
-98,332 |
-289,647 | |||||||||||
Other related parties |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CBS Previdência |
97,051 |
97,051 |
8 |
11,139 |
11,147 |
|||||||||||||||
Fundação CSN |
|
321 |
|
373 |
|
694 |
|
|
|
|
|
|
|
|
|
-523 |
|
18 |
|
-505 |
Usiminas |
1,187 |
1,187 |
196 |
196 |
51,346 |
51,346 | ||||||||||||||
Panatlântica |
|
42,347 |
|
|
|
42,347 |
|
|
|
|
|
|
|
208,934 |
|
|
|
|
|
208,934 |
Ibis Participações e Serviços |
-1,420 |
-1,420 | ||||||||||||||||||
Companhia de Gás do Ceará |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-574 |
|
|
|
-574 |
Taquari Participações S.A |
-130 |
-130 | ||||||||||||||||||
|
|
43,855 |
|
97,424 |
|
141,279 |
|
204 |
|
11,139 |
|
11,343 |
|
260,280 |
|
-2,647 |
|
18 |
|
257,651 |
Associates |
||||||||||||||||||||
Arvedi Metalfer do Brasil S.A. |
|
13,366 |
|
|
|
13,366 |
|
|
|
|
|
|
|
|
|
|
|
395 |
|
395 |
Total at 3/31/2014 |
528,907 |
302,892 |
831,799 |
441,454 |
8,664,359 |
9,105,813 |
351,370 |
-285,052 |
-97,919 |
-31,601 | ||||||||||
Total at 12/31/2013 |
|
987,969 |
|
719,042 |
|
1,707,011 |
|
475,099 |
|
8,533,824 |
|
9,008,923 |
|
|
|
|
|
|
|
|
Total at 3/31/2013 |
|
|
|
|
|
|
178,835 |
-154,642 |
-101,640 |
-77,447 |
1. Refers to loans of the subsidiary FTL – Ferrrovia Transnordestina Logística S.A. to the jointly controlled entity Transnordestina Logística S.A.
2. Nacional Minérios S.A: Asset: Refers mainly to prepayment transactions with the indirect subsidiaries CSN Europe, CSN Portugal and CSN Ibéria. Contracts in US$: interest equivalent to 5.37% to 6.80% with final maturity in June 2015. As of March 31, 2014, borrowings total R$349,706 (R$360,990 as of December 31, 2013) of which R$311,235 is classified in short term and R$38,471 is classified in long term.
Liability: The advance from customer received from jointly controlled entity Nacional Minérios S.A. refers to the contractual obligation of supply of iron ore and port services. The contract is subject to interest rate of 12.5% p.a. and expires in September 2042.
3. Transnordestina Logística S.A: Contracts in R$: interest equivalent to 102.00% of the CDI with final maturity in March 2016. As of March 31, 2014, borrowings total R$96,449 (R$270,693 as of December 31, 2013) of which R$6,698 is classified in short term and R$89,751 is classified in long term.
· By transaction
PAGE 57 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
||
ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Parent Company | ||||||
Current |
Non-current |
Total | ||||
Assets |
|
|
|
|
|
|
Trade receivables (1) |
613,264 |
613,264 | ||||
Loans |
|
20,386 |
|
90,124 |
|
110,510 |
Dividends receivable |
84,879 |
84,879 | ||||
Actuarial asset |
|
|
|
96,665 |
|
96,665 |
Short-term and other investments (2) |
81,664 |
98,282 |
179,946 | |||
Other receivables |
|
53,810 |
|
118,913 |
|
172,723 |
Total at 3/31/2014 |
854,003 |
403,984 |
1,257,987 | |||
Total at 12/31/2013 |
|
1,570,254 |
|
624,850 |
|
2,195,104 |
Liabilities |
|
|
|
|
|
|
Borrowings and financing |
||||||
Prepayment |
|
114,667 |
|
2,802,004 |
|
2,916,671 |
Fixed rate notes and related parties bonds |
49,754 |
2,350,827 |
2,400,581 | |||
Related parties borrowings |
|
193,203 |
|
2,532,405 |
|
2,725,608 |
Other payables |
||||||
Accounts payable |
|
243,103 |
|
360,103 |
|
603,206 |
Advances from customers (3) |
442,162 |
8,652,674 |
9,094,836 | |||
Trade payables |
|
124,818 |
|
|
|
124,818 |
Actuarial liability |
11,118 |
11,118 | ||||
Total at 3/31/2014 |
|
1,167,707 |
|
16,709,131 |
|
17,876,838 |
Total at 12/31/2013 |
2,302,367 |
15,574,882 |
17,877,249 | |||
|
|
Statement of Income |
||||
Revenues |
||||||
Sales |
|
1,572,042 |
||||
Interest |
3,016 |
|||||
Expenses |
||||||
Purchases |
|
-379,646 |
||||
Interest |
-407,607 |
|||||
Exchange differences |
|
197,169 |
||||
Pension plan expenses |
-88,517 |
|||||
Total at 3/31/2014 |
|
896,457 |
||||
Total at 3/31/2013 |
459,820 |
1. Related parties receivables arise from product sales and service transactions between the parent and its subsidiaries and jointly controlled entities.
2. Short-term investments total R$81,664 as of March 31, 2014 (R$100,560 as of December 31, 2013) and investments in Usiminas shares classified as available-for-sale total R$98,282 (R$134,543 as of December 31, 2013).
3. Nacional Minérios S.A.: The advance from customer received from jointly controlled entity Nacional Minérios S.A. refers to the contractual obligation of supply of iron ore and port services. The contract is subject to interest rate of 12.5% p.a. and expires in September 2042.
· By company
PAGE 58 of 70
CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE) |
||
ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
Parent Company | ||||||||||||||||||||||
Assets |
Liabilities |
Statement of Income | ||||||||||||||||||||
Current |
Non-current |
Total |
Current |
Non-current |
Total |
Sales |
Purchases |
Finance income and costs, net |
Exchange differences, net |
Total | ||||||||||||
Subsidiaries |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Companhia Siderúrgica Nacional, LLC |
277 |
277 |
||||||||||||||||||||
CSN Portugal, Unipessoal Lda. |
|
|
|
|
|
|
|
95,962 |
|
24,624 |
|
120,586 |
|
|
|
|
|
-2,023 |
|
3,518 |
|
1,495 |
CSN Europe Lda. |
5,034 |
69,518 |
74,552 |
80 |
2,445 |
2,525 | ||||||||||||||||
CSN Resources S.A. (1) |
|
|
|
|
|
|
|
103,941 |
|
5,322,478 |
|
5,426,419 |
|
|
|
|
|
-69,028 |
|
187,215 |
|
118,187 |
CSN Handel GmbH (2) |
296,856 |
296,856 |
904,087 |
-12,331 |
891,756 | |||||||||||||||||
CSN Islands XII Corp. |
|
|
|
|
|
|
|
7,804 |
|
453,732 |
|
461,536 |
|
|
|
|
|
-5,625 |
|
14,299 |
|
8,674 |
CSN Ibéria Lda. |
57,531 |
57,531 |
-371 |
2,023 |
1,652 | |||||||||||||||||
ITA Energética S.A |
|
2,341 |
|
|
|
2,341 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Companhia Metalúrgica Prada (3) |
181,729 |
2,800 |
184,529 |
13,609 |
196 |
13,805 |
252,872 |
-29,490 |
223,382 | |||||||||||||
CSN Cimentos S.A. |
|
4,707 |
|
|
|
4,707 |
|
216 |
|
359,361 |
|
359,577 |
|
39,533 |
|
-829 |
|
-8,417 |
|
|
|
30,287 |
Companhia Metalic Nordeste |
17,113 |
17,113 |
8,595 |
-194 |
8,401 | |||||||||||||||||
Estanho de Rondônia S.A. |
|
1,063 |
|
3,695 |
|
4,758 |
|
227 |
|
|
|
227 |
|
|
|
-1,615 |
|
|
|
|
|
-1,615 |
Florestal Brasil S.A. |
1,762 |
1,762 |
||||||||||||||||||||
Sepetiba Tecon S.A. |
|
48,594 |
|
|
|
48,594 |
|
1,161 |
|
|
|
1,161 |
|
809 |
|
-2,378 |
|
|
|
|
|
-1,569 |
Mineração Nacional S.A. |
13 |
13 |
||||||||||||||||||||
Congonhas Minérios S.A. (4) |
|
|
|
|
|
|
|
162,243 |
|
1,757,353 |
|
1,919,596 |
|
|
|
|
|
-52,244 |
|
|
|
-52,244 |
Ferrovia Transnordestina Logística S.A. |
13,579 |
13,579 |
179,608 |
179,608 |
||||||||||||||||||
CSN Energia S.A. |
|
39,164 |
|
|
|
39,164 |
|
66,437 |
|
|
|
66,437 |
|
|
|
-59,546 |
|
|
|
|
|
-59,546 |
Companhia Brasileira de Latas |
20,649 |
78,193 |
98,842 |
40,704 |
40,704 |
14,776 |
-542 |
14,234 | ||||||||||||||
|
|
595,116 |
100,029 |
695,145 |
694,336 |
8,044,793 |
8,739,129 |
1,220,672 |
-94,594 |
-137,628 |
|
197,169 |
|
1,185,619 | ||||||||
Jointly controlled entities |
||||||||||||||||||||||
Nacional Minérios S.A. |
|
67,105 |
|
|
|
67,105 |
|
430,309 |
|
8,653,220 |
|
9,083,529 |
|
91,090 |
|
-1,827 |
|
-269,899 |
|
|
|
-180,636 |
Transnordestina Logística S.A. |
6,698 |
92,980 |
99,678 |
2,522 |
2,522 | |||||||||||||||||
MRS Logística S.A. |
|
30,402 |
|
|
|
30,402 |
|
22,225 |
|
|
|
22,225 |
|
|
|
-178,265 |
|
|
|
|
|
-178,265 |
CBSI - Companhia Brasileira de Serviços e Infraestrutura |
6,508 |
6,419 |
12,927 |
5,782 |
5,782 |
-36,452 |
-36,452 | |||||||||||||||
CGPAR Construção Pesada S.A. |
|
9,289 |
|
9,236 |
|
18,525 |
|
14,851 |
|
|
|
14,851 |
|
|
|
-65,861 |
|
|
|
|
|
-65,861 |
120,002 |
108,635 |
228,637 |
473,167 |
8,653,220 |
9,126,387 |
91,090 |
-282,405 |
-267,377 |
|
-458,692 | ||||||||||||
Other related parties |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CBS Previdência |
96,665 |
96,665 |
8 |
11,118 |
11,126 |
|||||||||||||||||
Fundação CSN |
|
321 |
|
373 |
|
694 |
|
|
|
|
|
|
|
|
|
-523 |
|
18 |
|
|
|
-505 |
Usiminas |
1,187 |
1,187 |
196 |
196 |
51,346 |
51,346 | ||||||||||||||||
Panatlântica |
|
42,347 |
|
|
|
42,347 |
|
|
|
|
|
|
|
208,934 |
|
|
|
|
|
|
|
208,934 |
Ibis Participações e Serviços |
-1,420 |
-1,420 | ||||||||||||||||||||
Companhia de Gás do Ceará |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-574 |
|
|
|
|
|
-574 |
Taquari Participações S.A |
-130 |
-130 | ||||||||||||||||||||
|
|
43,855 |
|
97,038 |
|
140,893 |
|
204 |
|
11,118 |
|
11,322 |
|
260,280 |
|
-2,647 |
|
18 |
|
|
|
257,651 |
Associates |
||||||||||||||||||||||
Arvedi Metalfer do Brasil S.A. |
|
13,366 |
|
|
|
13,366 |
|
|
|
|
|
|
|
|
|
|
|
396 |
|
|
|
396 |
Exclusive funds |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diplic, Mugen e Vértice |
81,664 |
98,282 |
179,946 |
-88,517 |
-88,517 | |||||||||||||||||
Total at 3/31/2014 |
|
854,003 |
|
403,984 |
|
1,257,987 |
|
1,167,707 |
|
16,709,131 |
|
17,876,838 |
|
1,572,042 |
|
-379,646 |
|
-493,108 |
|
197,169 |
|
896,457 |
Total at 12/31/2013 |
1,570,254 |
624,850 |
2,195,104 |
2,302,367 |
15,574,882 |
17,877,249 |
|
|
|
|
| |||||||||||
Total at 3/31/2013 |
|
|
|
|
|
|
|
|
|
|
|
|
|
954,914 |
|
-263,865 |
|
-346,092 |
|
114,863 |
|
459,820 |
1. CSN Resources S.A.: prepayment contracts in US dollars, Fixed Rate Notes, and Related parties Bonds.
2. CSN Handel GMBH: receivables of R$296,856 as of March 31, 2014 (R$303,073 as of December 31, 2013), classified in current assets. Refer to sales transactions on mining products.
3. Companhia Metalúrgica Prada: receivables of R$181,729 as of March 31, 2014 (R$201,726 as of December 31, 2013), classified in current assets. Refers to the purchase of steel and payment of ICMS.
4. Congonhas Minérios S.A.: contracts in Brazilian reais related to Related parties loans.
c) Key management personnel
PAGE 59 of 70
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The key management personnel, who have authority and responsibility for planning, directing and controlling the Company’s activities, include the members of the Board of Directors and statutory directors. The following is information on the compensation of such personnel and the related balances as of March 31, 2014.
3/31/2014 |
3/31/2013 | |||
Statement of Income | ||||
Short-term benefits for employees and officers |
|
2,261 |
|
3,369 |
Post-employment benefits |
13 |
33 | ||
Other long-term benefits |
|
n/a |
|
n/a |
Severance benefits |
n/a |
n/a | ||
Share-based compensation |
|
n/a |
|
n/a |
2,274 |
3,402 |
n/a – Not applicable
18. SHAREHOLDERS' EQUITY
i. Paid-in capital
Fully subscribed and paid-in capital as of March 31, 2014 is R$4,540,000 represented by 1,457,970,108 book-entry common shares without par value. Each common share entitles its holder to one vote in Shareholders’ Meetings.
ii. Authorized capital
The Company’s bylaws in effect as of March 31, 2014 determine that the capital can be raised to up to 2,400,000,000 shares by decision of the Board of Directors.
iii. Legal reserve
This reserve is recognized at the rate of 5% of the profit for each period, as provided for by Article 193 of Law 6,404/76, up to the ceiling of 20% of share capital.
iv. Treasury shares
As of March 31, 2014, the Company did not have any treasury shares.
v. Ownership structure
As of March 31, 2014, the Company’s ownership structure was as follows:
|
|
3/31/2014 |
|
|
12/31/2013 | |||
Number of common shares |
% of total shares |
Number of common shares |
% of total shares | |||||
Vicunha Siderurgia S.A. |
|
697,719,990 |
|
47.86% |
|
697,719,990 |
|
47.86% |
Rio Iaco Participações S.A. (*) |
|
58,193,503 |
|
3.99% |
|
58,193,503 |
|
3.99% |
Caixa Beneficente dos Empregados da CSN - CBS |
|
12,788,231 |
|
0.88% |
|
12,788,231 |
|
0.88% |
BNDES Participações S.A. - BNDESPAR |
|
8,794,890 |
|
0.60% |
|
8,794,890 |
|
0.60% |
NYSE (ADRs) |
|
360,223,083 |
|
24.71% |
|
356,019,691 |
|
24.42% |
BM&FBovespa |
|
320,250,411 |
|
21.96% |
|
324,453,803 |
|
22.25% |
|
|
1,457,970,108 |
|
100.00% |
|
1,457,970,108 |
|
100.00% |
(*) Rio Iaco Participação S. A. is a company part of the control group.
19. DIVIDENDS AND INTEREST ON CAPITAL
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On February 28, 2014, the Board of Directors approved the proposal for payment, as advance of mandatory minimum dividend, from the retained earnings reserve (statutory reserve of working capital), the amount of R$425,000 in dividends, corresponding to R$ 0.29150 per share.
20. NET SALES REVENUE
Net sales revenue is comprised as follows:
Consolidated |
Parent Company | |||||||
3/31/2014 |
|
3/31/2013 |
3/31/2014 |
|
3/31/2013 | |||
Gross revenue |
|
|
|
|
|
|
|
|
Domestic market |
|
3,526,857 |
|
3,380,022 |
|
3,268,888 |
|
3,124,974 |
Foreign market |
|
1,691,623 |
|
1,069,187 |
|
972,563 |
|
461,662 |
|
|
5,218,480 |
|
4,449,209 |
|
4,241,451 |
|
3,586,636 |
Deductions |
|
|
|
|
|
|
|
|
Cancelled sales and discounts |
|
-29,041 |
|
-47,502 |
|
-23,551 |
|
-45,932 |
Taxes levied on sales |
|
-818,561 |
|
-759,724 |
|
-727,447 |
|
-687,489 |
|
|
-847,602 |
|
-807,226 |
|
-750,998 |
|
-733,421 |
Net revenue |
|
4,370,878 |
|
3,641,983 |
|
3,490,453 |
|
2,853,215 |
21. EXPENSES BY NATURE
|
|
Consolidated |
|
|
Parent Company | |||
3/31/2014 |
3/31/2013 |
3/31/2014 |
3/31/2013 | |||||
Raw materials and inputs |
|
-1,493,417 |
|
-1,391,167 |
|
-941,229 |
|
-914,581 |
Labor cost |
-410,300 |
-348,026 |
-327,001 |
-285,876 | ||||
Supplies |
|
-271,434 |
|
-253,620 |
|
-258,458 |
|
-243,867 |
Maintenance cost (services and materials) |
-320,614 |
-300,357 |
-310,483 |
-288,165 | ||||
Outsourcing services |
|
-513,224 |
|
-492,335 |
|
-380,159 |
|
-326,420 |
Depreciation, amortization and depletion (Note 8 a) |
-285,346 |
-287,236 |
-234,661 |
-229,830 | ||||
Other |
|
-33,962 |
|
-89,672 |
|
-39,478 |
|
-101,933 |
-3,328,297 |
-3,162,413 |
-2,491,469 |
-2,390,672 | |||||
Classified as: |
|
|
|
|
|
|
|
|
Cost of sales (Note 24) |
-3,034,529 |
-2,851,577 |
-2,311,229 |
-2,205,276 | ||||
Selling expenses (Note 24) |
|
-189,915 |
|
-201,250 |
|
-97,377 |
|
-109,267 |
General and administrative expenses (Note 24) |
-103,853 |
-109,586 |
-82,863 |
-76,129 | ||||
|
|
-3,328,297 |
|
-3,162,413 |
|
-2,491,469 |
|
-2,390,672 |
22. OTHER OPERATING INCOME (EXPENSES)
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Consolidated |
Parent Company | |||||||
3/31/2014 |
|
3/31/2013 |
3/31/2014 |
|
3/31/2013 | |||
Other operating income |
|
|
|
|
|
|
|
|
Lawsuit indemnities/wins |
967 |
610 |
553 |
538 | ||||
Rentals and leases |
|
507 |
|
200 |
|
252 |
|
200 |
Reversal of provisions |
3,136 |
893 |
3,136 |
893 | ||||
Other revenues |
|
3,103 |
|
2,553 |
|
705 |
|
1,887 |
7,713 |
4,256 |
4,646 |
3,518 | |||||
Other operating expenses |
||||||||
Taxes and fees |
|
-3,828 |
|
-4,203 |
|
-2,168 |
|
-2,697 |
Provision for tax, social security, labor, civil and environmental risks, |
-114,815 |
-23,452 |
-111,887 |
-25,249 | ||||
Contractual, nondeductible fines |
|
-118 |
|
-10,058 |
|
-29 |
|
-9,889 |
Depreciation of unused equipment (Note 8 a) |
-9,060 |
-7,037 |
-6,785 | |||||
Residual value of permanent assets written off (Note 8) |
|
-4,628 |
|
-1,832 |
|
-4,288 |
|
|
Inventory impairment losses/reversals (Note 5) |
-16,200 |
391 |
-14,624 |
|||||
Expenses on studies and project engineering |
|
-10,829 |
|
-16,538 |
|
-10,657 |
|
-16,330 |
Pension plan expenses |
-13,443 |
-7,759 |
-13,443 |
-7,759 | ||||
Other expenses |
|
-11,420 |
|
-28,412 |
|
-8,961 |
|
-9,818 |
-184,341 |
-98,900 |
-166,057 |
-78,527 | |||||
Other operating income (expenses), net |
-176,628 |
-94,644 |
-161,411 |
-75,009 |
23. FINANCE INCOME (COSTS)
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|
|
Consolidated |
|
|
Parent Company | |||
3/31/2014 |
3/31/2013 |
3/31/2014 |
3/31/2013 | |||||
Finance income |
|
|
|
|
|
|
|
|
Related parties (Note 17 b) |
11,066 |
61 |
3,016 |
20,080 | ||||
Income from short-term investments |
|
20,000 |
|
28,291 |
|
552 |
|
2,286 |
Other income |
6,986 |
9,468 |
5,001 |
2,667 | ||||
|
|
38,052 |
|
37,820 |
|
8,569 |
|
25,033 |
Finance costs |
||||||||
Borrowings and financing - foreign currency |
|
-167,893 |
|
-166,685 |
|
-24,625 |
|
-16,574 |
Borrowings and financing - local currency |
-423,423 |
-328,360 |
-367,629 |
-251,211 | ||||
Related parties (Note 17 b) |
|
-108,985 |
|
-101,701 |
|
-496,124 |
|
-366,172 |
Capitalized interest (Notes 8 and 29) |
43,934 |
116,774 |
43,934 |
71,320 | ||||
Losses on derivatives (*) |
|
-3,069 |
|
-2,363 |
|
-636 |
|
-1,197 |
Interest, fines and late payment charges |
-40,615 |
-6,408 |
-38,151 |
-4,857 | ||||
Other finance costs |
|
-23,984 |
|
-47,675 |
|
-18,667 |
|
-37,794 |
-724,035 |
-536,418 |
-901,898 |
-606,485 | |||||
Inflation adjustment and exchange differences, net |
|
|
|
|
|
|
|
|
Inflation adjustments |
5,729 |
-23,132 |
2,619 |
-9,894 | ||||
Exchange differences |
|
30,232 |
|
-13,786 |
|
311,883 |
|
126,107 |
Exchange losses on derivatives (*) |
-91,177 |
8,233 |
||||||
|
|
-55,216 |
|
-28,685 |
|
314,502 |
|
116,213 |
Finance costs, net |
-741,199 |
-527,283 |
-578,827 |
-465,239 | ||||
|
|
|
|
|
|
|
|
|
(*) Statement of gains and losses on derivative transactions |
||||||||
Real-to-dollar swap |
|
-18,772 |
|
-633 |
|
|
|
|
Euro-to-dollar swap |
-557 |
5,396 |
||||||
Yen-to-dollar swap |
|
|
|
-8 |
|
|
|
|
Dollar-to-euro swap |
-485 |
3,478 |
||||||
Fixed rate-to-dollar swap |
|
-71,363 |
|
|
|
|
|
|
-91,177 |
8,233 |
|
| |||||
Libor-to-CDI swap |
|
-636 |
|
-1,197 |
|
-636 |
|
-1,197 |
Fixed rate-to-CDI swap |
-2,433 |
-1,166 |
||||||
|
|
-3,069 |
|
-2,363 |
|
-636 |
|
-1,197 |
-94,246 |
5,870 |
-636 |
-1,197 |
24. SEGMENT INFORMATION
The information related to segment information did not have changes in relation to that disclosed in the Company's financial statements as of December 31, 2013 and, accordingly, the Company decided not to repeat it in the condensed interim financial statements as of March 31, 2014.
According to the Group’s structure, its businesses are distributed into five (5) operating segments.
PAGE 63 of 70
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3/31/2014 | ||
Profit or loss |
Steel |
Mining |
Logistics |
|
Energy |
Cement |
Corporate |
Consolidated | ||||||||
Port |
|
Railroads |
||||||||||||||
Metric tons (thou.) - (unaudited) (*) |
|
1,388,395 |
|
5,509,670 |
|
|
|
|
|
|
|
487,692 |
|
|
|
|
Net revenues |
||||||||||||||||
Domestic market |
|
2,355,499 |
|
99,749 |
|
60,176 |
|
277,264 |
|
65,057 |
|
98,040 |
|
-250,079 |
|
2,705,706 |
Foreign market |
771,405 |
1,147,695 |
-253,928 |
1,665,172 | ||||||||||||
Total net revenue (Note 20) |
|
3,126,904 |
|
1,247,444 |
|
60,176 |
|
277,264 |
|
65,057 |
|
98,040 |
|
-504,007 |
|
4,370,878 |
Cost of sales and services (Note 21) |
-2,394,701 |
-716,093 |
-34,057 |
-204,989 |
-41,987 |
-65,211 |
422,509 |
-3,034,529 | ||||||||
Gross profit |
|
732,203 |
|
531,351 |
|
26,119 |
|
72,275 |
|
23,070 |
|
32,829 |
|
-81,498 |
|
1,336,349 |
General and administrative expenses (Note 21) |
-165,719 |
-15,953 |
-593 |
-28,373 |
-4,701 |
-14,731 |
-63,698 |
-293,768 | ||||||||
Depreciation (Note 8 a) |
|
194,729 |
|
69,763 |
|
1,966 |
|
38,919 |
|
4,272 |
|
8,572 |
|
-32,875 |
|
285,346 |
Proportionate EBITDA of jointly controlled entities |
111,861 |
111,861 | ||||||||||||||
Adjusted EBITDA |
|
761,213 |
|
585,161 |
|
27,492 |
|
82,821 |
|
22,641 |
|
26,670 |
|
-66,210 |
|
1,439,788 |
Sales by geographic area |
|
|
|
|
|
|
|
| ||||||||
Asia |
|
4,433 |
|
1,099,799 |
|
|
|
|
|
|
|
|
|
|
|
1,104,232 |
North America |
169,338 |
169,338 | ||||||||||||||
Latin America |
|
45,244 |
|
|
|
|
|
|
|
|
|
|
|
|
|
45,244 |
Europe |
549,248 |
47,896 |
597,144 | |||||||||||||
Other |
|
3,142 |
|
|
|
|
|
|
|
|
|
|
|
-253,928 |
|
-250,786 |
Foreign market |
771,405 |
1,147,695 |
-253,928 |
1,665,172 | ||||||||||||
Domestic market |
|
2,355,499 |
|
99,749 |
|
60,176 |
|
277,264 |
|
65,057 |
|
98,040 |
|
-250,079 |
|
2,705,706 |
TOTAL |
3,126,904 |
1,247,444 |
60,176 |
277,264 |
65,057 |
98,040 |
-504,007 |
4,370,878 | ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3/31/2013 | |
Profit or loss |
Steel |
Mining |
Logistics |
|
Energy |
Cement |
Corporate |
Consolidated | ||||||||
Port |
|
Railroads |
||||||||||||||
Metric tons (thou.) - (unaudited) (*) |
|
1,550,397 |
|
3,258,560 |
|
|
|
|
|
|
|
455,791 |
|
|
|
|
Net revenues |
||||||||||||||||
Domestic market |
|
2,313,402 |
|
87,340 |
|
39,487 |
|
225,072 |
|
46,607 |
|
97,877 |
|
-217,804 |
|
2,591,981 |
Foreign market |
633,906 |
659,411 |
-243,315 |
1,050,002 | ||||||||||||
Total net revenue (Note 20) |
|
2,947,308 |
|
746,751 |
|
39,487 |
|
225,072 |
|
46,607 |
|
97,877 |
|
-461,119 |
|
3,641,983 |
Cost of sales and services (Note 21) |
-2,455,764 |
-453,991 |
-20,781 |
-170,553 |
-40,813 |
-67,429 |
357,754 |
-2,851,577 | ||||||||
Gross profit |
|
491,544 |
|
292,760 |
|
18,706 |
|
54,519 |
|
5,794 |
|
30,448 |
|
-103,365 |
|
790,406 |
General and administrative expenses (Note 21) |
-157,890 |
-17,211 |
-5,522 |
-22,233 |
-4,980 |
-14,076 |
-88,924 |
-310,836 | ||||||||
Depreciation (Note 8 a) |
|
193,932 |
|
50,904 |
|
1,749 |
|
30,754 |
|
4,259 |
|
7,498 |
|
-1,860 |
|
287,236 |
Proportionate EBITDA of jointly controlled entities |
135,118 |
135,118 | ||||||||||||||
Adjusted EBITDA |
|
527,586 |
|
326,453 |
|
14,933 |
|
63,040 |
|
5,073 |
|
23,870 |
|
-59,031 |
|
901,924 |
Sales by geographic area |
|
|
|
|
|
|
|
| ||||||||
Asia |
|
8,656 |
|
484,133 |
|
|
|
|
|
|
|
|
|
|
|
492,789 |
North America |
148,674 |
148,674 | ||||||||||||||
Latin America |
|
30,531 |
|
|
|
|
|
|
|
|
|
|
|
|
|
30,531 |
Europe |
434,781 |
175,278 |
610,059 | |||||||||||||
Other |
|
11,264 |
|
|
|
|
|
|
|
|
|
|
|
-243,315 |
|
-232,051 |
Foreign market |
633,906 |
659,411 |
-243,315 |
1,050,002 | ||||||||||||
Domestic market |
|
2,313,402 |
|
87,340 |
|
39,487 |
|
225,072 |
|
46,607 |
|
97,877 |
|
-217,804 |
|
2,591,981 |
TOTAL |
2,947,308 |
746,751 |
39,487 |
225,072 |
46,607 |
97,877 |
-461,119 |
3,641,983 |
(*) The ore sales volumes presented in this note take into consideration Company sales and the interest in its subsidiaries and jointly controlled entities (Namisa 60%).
Adjusted EBITDA is the tool based on which the chief operating decision maker measures segment performance and the capacity to generate recurring operating cash, and consists of profit for the year less net finance income (costs), income tax and social contribution, depreciation and amortization, share of profits of investments, and other operating income (expenses), plus the proportional EBITDA of jointly controlled entities.
Even though it is an indicator used in segment performance measurements, EBITDA is not a measurement recognized by accounting practices adopted in Brazil or IFRS, does not have a standard definition, and may not be comparable with measurements using similar names provided by other entities.
As required by IFRS 8, the table below shows the reconciliation of the measurement used by the chief operating decision maker with the results determined using the accounting practices.
PAGE 64 of 70
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Version: 1 |
Consolidated | ||||
3/31/2014 |
3/31/2013 | |||
Profit for the period |
|
52,096 |
|
16,316 |
Depreciation (Note 8 a) |
285,346 |
287,236 | ||
Income tax and social contribution (Note 13) |
|
27,155 |
|
-141,978 |
Finance income (Note 23) |
741,199 |
527,283 | ||
EBITDA |
|
1,105,796 |
|
688,857 |
Other operating income (expenses) (Note 22) |
176,628 |
94,644 | ||
Share of profits of investees |
|
45,503 |
|
-16,695 |
Proportionate EBITDA of jointly controlled entities |
111,861 |
135,118 | ||
Adjusted EBITDA (*) |
|
1,439,788 |
|
901,924 |
(*) The Company discloses its adjusted EBITDA net of its share of profits of investments and other operating income (expenses) because it understands that these should not be included in the calculation of recurring operating cash generation.
25. EARNINGS PER SHARE (EPS)
Consolidated |
Parent Company | ||||||
3/31/2014 |
|
3/31/2013 |
3/31/2014 |
|
3/31/2013 | ||
Common shares |
Common shares | ||||||
Profit for the period |
|
|
|
|
|
|
|
Attributed to owners of the Company |
55,334 |
|
27,326 |
|
55,334 |
|
27,326 |
Weighted average number of shares |
1,457,542 |
|
1,457,970 |
|
1,457,542 |
|
1,457,970 |
Basic and diluted EPS |
0.03796 |
0.01874 |
0.03796 |
0.01874 |
PAGE 65 of 70
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
26. GUARANTEES
The Company is liable for guarantees for its subsidiaries and jointly controlled entities, as follows:
| |||||||||||||||||||
Currency |
Maturities |
Loans |
Tax foreclosure |
Other |
Total | ||||||||||||||
3/31/2014 |
|
12/31/2013 |
3/31/2014 |
|
12/31/2013 |
3/31/2014 |
|
12/31/2013 |
3/31/2014 |
|
12/31/2013 | ||||||||
Transnordestina Logísitca |
R$ |
|
Up to 12/8/2027 |
|
1,870,524 |
|
1,875,360 |
|
20,600 |
|
20,600 |
|
168,009 |
|
168,009 |
|
2,059,133 |
|
2,063,969 |
FTL - Ferrovia Transnordestina |
R$ |
11/15/2020 |
123,450 |
125,250 |
123,450 |
125,250 | |||||||||||||
CSN Cimentos |
R$ |
|
Up to 10/25/2015 |
|
|
|
|
|
26,423 |
|
26,423 |
|
39,287 |
|
39,287 |
|
65,710 |
|
65,710 |
Prada |
R$ |
Up to 02/10/2016 |
10,133 |
10,133 |
21,340 |
21,916 |
31,473 |
32,049 | |||||||||||
CSN Energia |
R$ |
|
Indefinite |
|
|
|
|
|
2,829 |
|
2,829 |
|
|
|
|
|
2,829 |
|
2,829 |
Congonhas Minérios |
R$ |
5/21/2019 |
2,000,000 |
2,000,000 |
2,000,000 |
2,000,000 | |||||||||||||
Fundação CSN |
R$ |
|
Indefinite |
|
1,003 |
|
1,003 |
|
|
|
|
|
|
|
|
|
1,003 |
|
1,003 |
Other (*) |
R$ |
12/31/2014 |
12,000 |
12,000 |
|||||||||||||||
Total em R$ |
|
|
|
|
4,006,977 |
|
4,001,613 |
|
59,985 |
|
59,985 |
|
228,636 |
|
229,212 |
|
4,295,598 |
|
4,290,810 |
CSN Islands IX |
US$ |
1/15/2015 |
400,000 |
400,000 |
400,000 |
400,000 | |||||||||||||
CSN Islands XI |
US$ |
|
9/21/2019 |
|
750,000 |
|
750,000 |
|
|
|
|
|
|
|
|
|
750,000 |
|
750,000 |
CSN Islands XII |
US$ |
Perpetual |
1,000,000 |
1,000,000 |
1,000,000 |
1,000,000 | |||||||||||||
CSN Resources |
US$ |
|
7/21/2020 |
|
1,200,000 |
|
1,200,000 |
|
|
|
|
|
|
|
|
|
1,200,000 |
|
1,200,000 |
Sepetiba Tecon |
US$ |
Indefinite |
8,976 |
15,708 |
8,976 |
15,708 | |||||||||||||
CSN Handel |
US$ |
|
6/27/2015 |
|
100,000 |
|
100,000 |
|
|
|
|
|
|
|
|
|
100,000 |
|
100,000 |
Total in US$ |
3,458,976 |
3,465,708 |
|
|
|
|
3,458,976 |
3,465,708 | |||||||||||
CSN Steel S.L. |
EUR |
|
1/31/2020 |
|
120,000 |
|
120,000 |
|
|
|
|
|
|
|
|
|
120,000 |
|
120,000 |
Total in EUR |
120,000 |
120,000 |
|
|
|
|
120,000 |
120,000 | |||||||||||
Total in R$ |
|
|
|
|
8,201,763 |
|
8,505,948 |
|
|
|
|
|
|
|
|
|
8,201,763 |
|
8,505,948 |
12,208,740 |
12,507,561 |
59,985 |
59,985 |
228,636 |
229,212 |
12,497,361 |
12,796,758 |
(*) CSN Corporate Guarantee with the subsidiaries CSN Cimentos, Nacional Minérios, Companhia Metalúrgica Prada, Cia Metalic Nordeste, Sepetiba Tecon and CSN Energia.
PAGE 66 of 70
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
27. COMMITMENTS
a. Take-or-pay contracts
As of March 31, 2014, the Company was a party to take-or-pay contracts as shown in the following table:
Payments in the period |
|
|
|
|
|
|
|
|
|
|
| ||||||||
Concessionaire |
Type of service |
Agreement terms and conditions |
2013 |
2014 |
2014 |
2015 |
2016 |
2017 |
After 2017 |
Total | |||||||||
MRS Logística |
Iron ore transportation |
|
Contractual clause providing for guaranteed revenue on railway freight. In the case of CSN, this means a minimum payment of 80% of freight estimate. |
|
24,459 |
|
30,739 |
|
381,847 |
|
477,829 |
|
477,829 |
|
477,829 |
|
4,260,642 |
|
6,075,976 |
MRS Logística |
Steel products transportation |
Transportation of at least 80% of annual volume agreed with MRS. |
15,937 |
14,517 |
53,130 |
70,840 |
517 |
124,487 | |||||||||||
MRS Logística |
Iron ore, coal and coke transportation |
|
Transportation of 8,280,000 metric tons per year of iron ore and 3,600,000 metric tons per year of coal, coke and other reducing agents. |
|
18,689 |
|
40,422 |
|
91,954 |
|
122,605 |
|
122,605 |
|
122,605 |
|
1,103,446 |
|
1,563,215 |
FCA (*) |
Mining products transportation |
Transportation of at least 1,900,000 metric tons per year. |
36 |
642 |
|||||||||||||||
FCA |
FCA railway transportation of clinker to CSN Cimentos |
|
Transportation of at least 675,000 metric tons per year of clinker in 2011 and 738,000 metric tons per year of clinker starting 2012. |
|
173 |
|
193 |
|
20,475 |
|
27,300 |
|
27,300 |
|
27,300 |
|
63,701 |
|
166,076 |
White Martins (**) |
Supply of gas (oxygen, nitrogen and argon) |
CSN undertakers to buy at least 90% of the annual volume of gas contracted with White Martins. |
19,356 |
83,189 |
110,415 |
110,415 |
304,019 | ||||||||||||
CEG Rio |
Supply of natural gas |
|
CSN undertakes to buy at least 70% of the monthly natural gas volume. |
|
35,575 |
|
141,570 |
|
212,678 |
|
|
|
|
|
|
|
|
|
212,678 |
Vale S.A |
Supply of iron ore pellets |
CSN undertakes to buy at least 90% of the volume of iron ore pellets secured by contract. The take-or-pay volume is determined every 18 months. |
35,863 |
124,154 |
69,249 |
69,249 | |||||||||||||
Compagás |
Supply of natural gas |
|
CSN undertakes to buy at least 80% of the annual natural gas volume secured agreed with Compagás. |
|
5,778 |
|
3,354 |
|
12,908 |
|
17,211 |
|
17,211 |
|
17,211 |
|
120,479 |
|
185,020 |
COPEL |
Power supply |
CSN undertakers to buy at least 80% of the annual energy volume contracted with COPEL. |
3,622 |
4,652 |
2,851 |
8,553 |
8,553 |
8,553 |
28,510 |
57,020 | |||||||||
K&K Tecnologia |
Processing of blast furnace sludge generated during pig iron production |
|
CSN undertakes to supply at least 3,000 metric tons per month of blast furnace sludge for processing at K&K sludge concentration plant. |
|
1,904 |
|
2,691 |
|
5,305 |
|
7,074 |
|
7,074 |
|
7,074 |
|
44,212 |
|
70,739 |
Harsco Metals |
Processing of slag generated during pig iron and steel production |
Harsco Metals undertakes to process metal products and slag crushing byproducts resulting from CSN’s pig iron and steel manufacturing process, receiving for this processing the amount corresponding to the product of the multiplication of unit price (R$/t) by total production of liquid steel from CSN steel mill, ensuring a minimum production of liquid steel of 400,000 metric tons. |
9,861 |
9,892 |
7,972 |
7,972 | |||||||||||||
Siemens |
Manufacturing, repair, recovery and production of ingot casting machine units |
|
Siemens undertakes to manufacture, repair, recover and produce, in whole or in part, ingot casting machine units to provide the necessary off-line and on-line maintenance of continuous ingot casting machine assemblies of the Presidente Vargas plant (UPV). Payment is set at R$/t of produced steel plates. |
|
9,607 |
|
11,711 |
|
9,067 |
|
|
|
|
|
|
|
|
|
9,067 |
(*) in renegotiation phase. |
|||||||||||||||||||
(**) in renegotiation phase and payments were suspended. |
180,860 |
384,537 |
950,625 |
841,827 |
771,504 |
660,572 |
5,620,990 |
8,845,518 |
b. Concession agreements
Minimum future payments related to government concessions as of March 31, 2014 fall due according to the schedule set out in the following table:
Company |
|
|
|
|
|
|
|
|
|
|||||
Concession |
Type of service |
2014 |
2015 |
2016 |
2017 |
After 2017 |
Total | |||||||
MRS |
|
30-year concession, renew able for another 30 years, to provide iron ore railway transportation services from the Casa de Pedra mines, in Minas Gerais, coke and coal from the Itaguaí Port, in Rio de Janeiro, to Volta Redonda, transportation of export goods to the Itaguaí and Rio de Janeiro Ports, and shipping of finished goods to the domestic market. |
|
68,023 |
|
90,697 |
|
90,697 |
|
90,697 |
|
748,248 |
|
1,088,362 |
FTL (Ferrovia Transnordestina Logística) |
30-year concession granted on December 31, 1997, renewable for another 30 years for the development of public utility to operate the Northeastern railway system. The railway system covers 4,238 kilometers of railroads in the states of Maranhão, Piauí, Ceará, Paraíba, Pernambuco, Alagoas and Rio Grande do Norte. |
5,460 |
7,281 |
7,281 |
7,281 |
68,559 |
95,862 | |||||||
Tecar |
|
Concession to operate TECAR, a solid bulk terminal, one of the four terminals that comprise the Itaguaí Port, in Rio de Janeiro, for a period ending 2022 and renew able for another 25 years. |
|
217,819 |
|
263,858 |
|
263,858 |
|
263,858 |
|
1,319,290 |
|
2,328,683 |
Tecon |
25-year concession granted in July 2001, renewable for another 25 years, to operate the container terminal at the Itaguaí Port. |
18,567 |
24,756 |
24,756 |
24,756 |
198,043 |
290,878 | |||||||
|
|
|
|
309,869 |
|
386,592 |
|
386,592 |
|
386,592 |
|
2,334,140 |
|
3,803,785 |
PAGE 67 of 70
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ITR –– Quarterly Financial Information - March 31, 2014 – CIA SIDERURGICA NACIONAL |
Version: 1 |
28. INSURANCE
In 2013, after negotiation with insurers and reinsurers in Brazil and abroad, an Insurance Issue Certificate was issued for the contracting of a policy of Operational Risk of Property Damages and Loss of Profits, with effect from June 30, 2013 to June 30, 2014. Under the insurance policy, the LMI (Maximum Limit of Indemnity) is US$500,000,000 and covers the following units and subsidiaries of the Company: Usina Presidente Vargas, Mineração Casa de Pedra, CSN Paraná, Terminal de cargas Tecar, Terminal Tecon, Namisa, CSN Handel and Namisa Handel. CSN takes responsibility for a range of retention of US$300,000,000 in excess of the deductibles for property damages and loss of profits.
In view of their nature, the risk assumptions adopted are not part of the scope of an audit of interim financial statements and, accordingly, were not reviewed by our independent auditors.
29. ADDITIONAL INFORMATION TO CASH FLOWS
Consolidated |
Parent Company | ||||||
3/31/2014 |
|
3/31/2013 |
3/31/2014 |
|
3/31/2013 | ||
Income tax and social contribution paid |
8,250 |
|
9,295 |
|
|
|
|
Increase of PP&E with interest capitalization |
43,934 |
116,774 |
43,934 |
71,320 | |||
|
52,184 |
|
126,069 |
|
43,934 |
|
71,320 |
30. STATEMENT OF COMPREHENSIVE INCOME
3/31/2014 |
|
3/31/2013 |
3/31/2014 |
|
3/31/2013 | ||
Profit for the period |
52,096 |
|
16,316 |
|
55,334 |
|
27,326 |
Other comprehensive income |
|||||||
Items that will not be subsequently reclassified to the statement of income |
|
|
|
|
|
|
|
Actuarial (losses) gains on defined benefit pension plan |
1,710 |
1,710 |
|||||
|
1,710 |
|
|
|
1,710 |
|
|
Items that could be subsequently reclassified to the statement of income |
|
|
|
|
|
|
|
Cumulative translation adjustments for the period |
-44,326 |
-43,239 |
-44,326 |
-43,239 | |||
Available-for-sale assets |
-648,780 |
|
-385,976 |
|
-631,003 |
|
-287,389 |
Income tax and social contribution on available-for-sale assets |
220,585 |
131,232 |
214,541 |
97,712 | |||
Available-for-sale assets from investments in subsidiaries |
|
|
|
|
-11,733 |
|
-65,067 |
-472,521 |
-297,983 |
-472,521 |
-297,983 | ||||
|
-470,811 |
|
-297,983 |
|
-470,811 |
|
-297,983 |
Total comprehensive income for the period |
-418,715 |
|
-281,667 |
|
-415,477 |
|
-270,657 |
Attributable to: |
|
|
|
|
|
|
|
Owners of the Company |
-415,477 |
-270,657 |
-415,477 |
-270,657 | |||
Non-controlling interests |
-3,238 |
|
-11,010 |
|
|
|
|
-418,715 |
-281,667 |
-415,477 |
-270,657 |
31. EVENTS AFTER THE REPORTING PERIOD
· CADE Decision - Usiminas Shares
On April 9, 2014, the Administrative Council for Economic Defense (CADE - Conselho Administrativo de Defesa Econômica) issued its decision on the matter and a commitment agreement (Performance Commitment Agreement), or TCD, was signed between CADE and CSN. Under the terms of the decision of CADE and TCD, CSN must reduce its interest in Usiminas within a specified term. The term and percentage of reduction are confidential. Moreover, the political rights at Usiminas will continue suspended until the Company reaches the limits established in the TCD.
PAGE 68 of 70
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Version: 1 |
· Share Repurchase Program
On April 15, 2014, the Board of Directors authorized the opening of a new program for repurchase of shares issued by the Company, to be held in treasury for subsequent sale or cancelation.
· Export Prepayment
On April 25, 2014, the Company contracted with Banco Santander an export prepayment transaction in the amount of US$ 200 million with maturity in April 2019.
PAGE 69 of 70
(Convenience Translation into English from the Original Previously Issued in Portuguese)
REPORT ON REVIEW OF INTERIM FINANCIAL INFORMATION
To the Board of Directors and Shareholders of
Companhia Siderúrgica Nacional
São Paulo – SP
Introduction
We have reviewed the accompanying individual and consolidated interim financial information of Companhia Siderúrgica Nacional (“the Company”), identified as Parent and Consolidated, respectively, included in the Interim Financial Information Form (ITR), for the three-month period ended March 31, 2014, which comprises the balance sheet as of March 31, 2014 and the related statements of income, and of comprehensive income, for the three-months periods then ended and of changes in equity and of cash flows for the three-month period then ended, including the explanatory notes.
The Company’s management is responsible for the preparation of the individual interim financial information in accordance with technical pronouncement CPC 21 (R1) – Interim Financial Information and of the consolidated interim financial information in accordance with technical pronouncement CPC 21 (R1) and with international standard IAS 34 - Interim Financial Reporting, issued by the International Accounting Standards Board - IASB, as well as for the presentation of such information in accordance with the standards issued by the Brazilian Securities and Exchange Commission (CVM), applicable to the preparation of Interim Financial Information (ITR). Our responsibility is to express a conclusion on this interim financial information based on our review.
Scope of review
We conducted our review in accordance with Brazilian and international standards on review of interim financial information (NBC TR 2410 and ISRE 2410 – Review of Interim Financial Information Performed by the Independent Auditor of the Entity, respectively). A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with standards on auditing and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion on the individual interim financial information
Based on our review, nothing has come to our attention that causes us to believe that the accompanying individual interim financial information included in the ITR referred to above was not prepared, in all material respects, in accordance with technical pronouncement CPC 21 (R1), applicable to the preparation of the Interim Financial Information (ITR) and presented in accordance with the standards issued by the Brazilian Securities Commission.
Conclusion on the consolidated interim financial information
Based on our review, nothing has come to our attention that causes us to believe that the accompanying consolidated interim financial information included in the ITR referred to above was not prepared, in all material respects, in accordance with technical pronouncement CPC 21 (R1) and international standard IAS 34, applicable to the preparation of Interim Financial Information (ITR) and presented in accordance with the standards issued by the Brazilian Securities Commission.
Other matters
Statements of value added
We have also reviewed the individual and consolidated interim statements of value added (DVA), for the three-month period ended March 31, 2014, prepared under the responsibility of the Company's Management, the presentation of which is required by the standards issued by the CVM applicable to the preparation of Interim Financial Information (ITR), and considered as supplemental information for International Financial Reporting Standards – IFRS, which do not require the presentation of DVA. These statements were subject to the same review procedures described above and, based on our review, nothing has come to our attention that causes us to believe that they were not prepared, in all material respects, consistently with the individual and consolidated interim financial information taken as a whole.
The accompanying individual and consolidated interim financial information has been translated into English for the convenience of readers outside Brazil.
São Paulo, May 6, 2014
DELOITTE TOUCHE TOHMATSU |
Roberto Wagner Promenzio |
Auditores Independentes |
Engagement Partner |
|
|
COMPANHIA SIDERÚRGICA NACIONAL | |
By: |
/S/ Benjamin Steinbruch
|
Benjamin Steinbruch
Chief Executive Officer |
| |
By: |
/S/ David Moise Salama
|
David Moise Salama
Investor Relations Executive Officer |
This press release may contain forward-looking statements. These statements are statements that are not historical facts, and are based on management's current view and estimates of future economic circumstances, industry conditions, company performance and financial results. The words "anticipates", "believes", "estimates", "expects", "plans" and similar expressions, as they relate to the company, are intended to identify forward-looking statements. Statements regarding the declaration or payment of dividends, the implementation of principal operating and financing strategies and capital expenditure plans, the direction of future operations and the factors or trends affecting financial condition, liquidity or results of operations are examples of forward-looking statements. Such statements reflect the current views of management and are subject to a number of risks and uncertainties. There is no guarantee that the expected events, trends or results will actually occur. The statements are based on many assumptions and factors, including general economic and market conditions, industry conditions, and operating factors. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations.