SID · Companhia Siderúrgica Nacional

Companhia Siderúrgica Nacional's 1Q26 results reflect seasonal challenges including heavy rainfall impacting mining operations and a weaker product mix in steel, leading to net revenue of R$10,603.8 million, down 7.0% from 4Q25. Gross profit declined to R$2,522.7 million with a 23.8% margin due to higher COGS from increased steel volumes and raw material costs, though year-over-year gross margin improved 0.6 p.p. from better cost control and favorable FX on USD-denominated inputs. SG&A dropped sharply 20.3% QoQ on mining seasonality, but rose 4.7% YoY from freight and multimodal consolidation. Other operating expenses improved significantly QoQ and YoY, avoiding prior non-recurring BF2 maintenance impacts. Financial result remained stable at negative R$1,306.9 million, with equity income down sharply on MRS performance. Net loss narrowed to R$555.0 million, aided by deferred taxes on increased tax losses. Adjusted EBITDA of R$2,646.0 million (23.9% margin) beat 1Q25 levels, powered by record cement results and logistics growth despite mining headwinds. Free cash flow was negative R$1,597.7 million from seasonality, working capital use, high financial expenses, and proactive debt paydowns. Net debt fell to R$40,505 million with leverage at 3.36x, supported by iron ore prepayments, FX gains on foreign debt, and ongoing asset sales. A US$1.2 billion bridge loan (expandable to US$1.4 billion) targets short/medium-term refinancing, collateralized by cement ops. Steel sales rose 12.1% QoQ to 1,116 kt on March strength post-antidumping, though down 2.5% YoY amid imports; exports surged 46.8% QoQ. Management highlights improving 2Q26 steel momentum, mining efficiencies, and sustained iron ore prices for stronger future performance.