Business Context and Reporting Period
Company: Companhia Siderúrgica Nacional (CSN) / National Steel Company
Filing Type: Form 6-K (Report of Foreign Private Issuer)
Reporting Period: Six months ended June 30, 2026 (Interim)
Business Segments: Steel, Mining, Logistics (Rail, Port, Road), Energy, and Cement.
Functional Currency: Brazilian Real (BRL)
Key Financial Metrics (Consolidated)
| Metric (in thousands BRL) | Six Months Ended 06/30/2026 | Six Months Ended 06/30/2025 |
|---|---|---|
| Net Revenue | 21,909,941 | 21,600,915 |
| Gross Profit | 5,453,627 | 5,258,342 |
| Operating Income (Loss) | (3,335,357) | (199,012) |
| Net Income (Loss) | (1,328,081) | (861,949) |
| Net Income Attributable to Controlling Interests | (1,409,654) | (785,146) |
| Loss Per Share (Basic & Diluted) | (1.06301) | (0.59207) |
| Cash and Cash Equivalents (End of Period) | 13,630,963 | 18,305,209 |
| Total Borrowings and Financing | 53,365,560 | 52,924,547 |
| Net Cash from Operating Activities | (670,993) | (1,399,172) |
Material Changes vs. Prior Period
- Revenue Growth: Net revenue increased by approximately 1.4% year-over-year, driven by volume and price adjustments, though foreign exchange fluctuations impacted the bottom line.
- Profitability Decline: The company reported a significant net loss of R$1.33 billion, compared to a loss of R$862 million in the prior year. This deterioration was primarily driven by a sharp increase in financial expenses and other operating expenses.
- Financial Expenses: Net financial expenses totaled R$3.15 billion for the six-month period, an increase from R$3.75 billion in the prior year, though the net impact on the bottom line was exacerbated by exchange rate variations and derivative realizations.
- Operating Expenses: "Other operating expenses" surged to R$1.70 billion (from R$343 million in the prior year), largely due to realized cash flow hedge losses (R$399 million), inventory write-downs (R$338 million), and legal proceeding expenses (R$298 million).
- Cash Flow: Operating cash flow improved significantly to a net outflow of R$671 million, compared to an outflow of R$1.40 billion in the prior period, aided by inventory management and working capital adjustments.
Guidance, Outlook, and Risks
- Subsequent Events (Post-June 30, 2026):
- Share Buyback: CSN Mineração S.A. approved an amendment to its share buyback program, increasing the limit to 100 million shares.
- Bond Exchange Offer: CSN Inova successfully completed an exchange offer for existing notes, exchanging 77.49% of outstanding notes for new notes with a higher fixed rate (11.00%) and cash payments.
- CSN Cimentos Sale: The company received binding proposals for the potential complete sale of its subsidiary, CSN Cimentos S.A., and is currently analyzing these offers.
- Risks and Contingencies:
- Legal Proceedings: Significant contingent liabilities exist, totaling approximately R$48.1 billion for proceedings classified as "possible loss" (not provisioned), including tax, labor, civil, and environmental matters.
- Environmental Liabilities: Provisions for environmental liabilities and asset retirement obligations increased to R$1.31 billion.
- Market Risks: The company remains exposed to exchange rate volatility (USD/BRL), interest rate fluctuations (CDI, SOFR), and commodity price volatility (Iron Ore/Platts index), managed through extensive hedging programs.
Investor Verification Checklist
- Debt Structure: Verify the impact of the recent bond exchange offer on future interest obligations and liquidity.
- CSN Cimentos Sale: Monitor the progress of the binding proposals for the sale of the Cement subsidiary, which could significantly alter the company's asset base and revenue mix.
- Legal Provisions: Review the R$1.0 billion in accrued liabilities for tax, labor, and civil risks, and the R$48 billion in unprovisioned contingent liabilities.
- Hedging Effectiveness: Assess the impact of realized cash flow hedge losses (R$399 million) on future earnings volatility.
- Inventory Valuation: Confirm the rationale behind the R$338 million inventory write-downs and the status of long-term iron ore inventory.