[Interpreted]. Good afternoon and thank you very much for waiting. Welcome to CSN’s Conference Call for the Presentation of the Results Related to the Third Quarter of 2015. We have today the officers of the company.

I would like to inform you that this event is being recorded and all participants will be on listen-only mode during the company’s presentation. Next we will initiate the Q&A session when further instructions will be provided. [Operator Instructions].

Today’s event is also being simultaneously webcasted online and it can be accessed through CSN website www.csn.com.br/ir. A slide presentation will be available through that website and will be controlled by you. The replay of this event will be available right after the call is completed.

Before proceeding, let me mention that forward-looking statements may be made during this conference call related to CSN’s business projections and financial and operating targets, are mere assumptions and believe the company as valid information currently available.

Future considerations are not a guarantee of performance as they involve risks, uncertainties and assumptions because it relates to future events. And therefore depend on circumstances that may, nor may not occur.

Investors should understand that general economic conditions, industry conditions, and other operating factors may affect future performance of CSN and as such could lead to results that differ materially from those expressed in such forward-looking statements. Now, I would like to turn the floor to Mr.

Gustavo Sousa, CSN’s Controllership, Tax Planning and Investor Relations Officer, who will present the company’s operating and financial highlights for the period. Please Mr. Sousa you may proceed..

[Interpreted]. Good afternoon everyone and thank you very much for participating in the CSN’s conference call for the results of the third quarter 2015. And now jumping straight to slide number 3, I have here a summary of our strategies to expand competitiveness and to recover our cash recovery.

This strategy is based on three pillars, operating efficiency, which comprises the total integration of our assets generating synergies allowing us to be leaders in most part this segment. When we look at our projects, our investments are focused on cost reductions and volume increase.

And more particularly we will talk about the migrations we did in the cement area. And after that we will have the presentation by Mr. Caffarelli, our Corporate Director who will talk about the financial aspects of the company.

Now jumping to page 4, here we have a market overview in the different segments where we operate in terms of new, a very unique portfolio with a very good focus on cost which has allowed us to be very competitive abroad. In terms of mining, we have a world-class asset totally integrated.

As for cement, we will see how this segment is growing in the company. And we will have further growing stages in this area. And we also would give some highlights on the logistics side about containers. And all of the segments have good assets that allow us to have self-sufficiency in terms of energy generation.

In the next slide we have our main targets and consolidated results. Our EBITDA was BRL853 million, a 6% increase vis-à-vis the same quarter of the year before. Our EBITDA margin is 20% in keeping with the second quarter of this year.

And a net loss of BRL533 million, our gross debt was BRL35 billion, net debt of BRL23 billion and net debt over EBITDA ratio of 6.6 times. In the next slide we have a graphical representation that shows the evolution of EBITDA of BRL853 million and also the results posted in the period with a special highlight to our financial results.

Here we show how we went from the financial result according to IFRS which is read by BRL1.5 billion to the financial result in green. And then on slide 7, will give you more details about the quarter, our financial result according to IFRS with BRL1.54 million.

This result once added to the financial revenues from our associate companies or joint ventures gives us a relevant cash position. And therefore our proportional financial result tends to be BRL779 million.

Well, considering the fact that then if the joint venture does not allow for consolidation, by the insurance of the proportional financial result, we just keep the parity with - in terms of CSN. Now, in the next slide we have the growth per segment segmented. We start with the steel performance.

In the last quarter we see a growth in sales in the forward market more particularly in the third quarter reached 42% of sales in the foreign market when compared to the total volume our net revenue was BRL2.7 billion and our EBITDA is BRL376 million in every top margin in the steel area of 14%.

Next slide, we show the performance in the past year in terms of our mix of products. And we provide products with a higher added volume. In the last part of the chart, we see that the coated steel product had an increase of 49% in the total sales volume, jumping from 49% to 52%.

Next slide, we have some cost numbers for the steel industry, we were able to promote a cost reduction both in dollars and in real which was good put us in the first cortile of our cost position. Now, going to slide 11, now we have the beginning, we have information on mining.

And in this quarter there was a growth in the production volume of 17% when compared to the previous quarters, reaching 7.94 million tons during the period with a special highlight for Casa de Pedra of 4.7 million which is again another production record in that mining sector.

Our net income grew 39%, our EBITDA grew 74% reaching BRL395 million with a margin of 42%. And this the highest margin ever posted in the mining segment since the first quarter of 2014.

Slide 12, we see that even with a reduction of 58.4% in Platts, and in the third quarter $54.9 even with that reduction in Platts’ we were able to keep our per ton FOB revenue. And we also promoted cost reduction which allowed us to have a $17 cost margin per ton and $19 per ton of cash margin.

Slide 13 shows that this cost performance has been gradually improving and this improvement was generated through some measures related to cost reduction supported by our mining team. Slide 14, we see the result of our debt received. CSN is very well positioned if you look at the overall scale of costs among all mining companies in the world.

In slide 15, we see that performance in our cement industry, cement area, there was a slight reduction in net revenue and there was also an EBIT reduction caused by a non-scheduled stoppage in Volta Redonda and our maintenance number 37 days which generated a reduction in EBITDA that we actively have been resumed and things are normalized.

On slide 16, we’ve been showing the slides through the market because it shows the evolution of our cement project. In the second quarter we had already showed you the level of production of the Grinding Mill and Arcos.

In the fourth quarter now, we are projecting out the Grinding Mill number 2 and for 2016 we will have to start up our new clinker kiln at Arcos. Now, going to slide 17, now we have here the breakdown of the performance from our container terminals statistically the Techcom.

The net revenue went from paring the third quarter of this year with the same quarter of the year before with net revenue grew 54% of EBITDA when compared to the second quarter of this year, 145%. Therefore the margin in the second quarter is 37%.

And all of that happened due to improvements in the main volume metrics at Techcom with a 44% growth in the volume of containers and 38% growth in the steel volume and almost 100% increase in the general cargo volumes.

Page 18, we see that this performance is a consequence of an increase in our regular routes portfolio especially now we launched a new line to Asia to important and export of container with these new routes, Techcom becomes the main container terminal from Rio into other countries.

And we also have a new regular route to the United States, the facility in Houston, Mexico and Central America, through the Gulf of Mexico.

In the third quarter, also we were able to consolidate the operation of a first regular project for general container, so we are connecting pick-on to Belo Horizonte, to the automotive area of Rio de Janeiro it’s like 19. We have the breakdown of the results of the companies by segment.

And the highlight goes to steel, to the steel area accounting for 65%, mining 42% and our logistics accounting for 15% of our EBITDA. So, steel 41%, mining 42%, logistics 15%.

The next page we have the nine-month to date numbers and we reach BRL1.7 billion in CapEx and the highlight goes to some anticipations we did this for various strategies of the company.

And the first consideration was for the acquisition of new mining equipment where we took advantage of the paring conditions of the iron ore market to be able to buy equipment and machinery at attractive prices.

And also equipment that we bought at very favorable conditions and all of the equipment, are already producing some good results in Casa de Pedra. And we accelerated the development of Arcos we wanted to also to anticipate part of our Arcos project as previously demonstrated in previous slides when I was sort to our cement project.

Now, going to page 21, we have our financial agenda. And then I will give the floor to Paulo Caffarelli our CFO..

[Interpreted]. Thank you very much and thank you for participating. I would like to refer to our financial agenda for this quarter. It’s made out of four items, I’m on page 21. I would like to say that the word of order here is reducing net debt over EBITDA ratio or leverage. At CSN we focus on liquidity which is BRL11 billion.

And in the third quarter, taking advantage of the depreciation of those exchange rates we had a percentage that if you invest above CDI our new revenue will be an increment of about BRL600 million. On item two, when below the liability management we were able to have an extension with Caixa Economica and Banco do Brasil at BRL4.8 billion.

We are constantly looking for the best cost and the best channels. In terms of cost reduction and working capital requirements there is a very strong focus in the reduction of working capital, inventory and its objective reduction of cost.

And finally, maybe what is more important to us at the moment is that in terms of divestment and the sale of some selected assets, all the banks are already, we take notice to already know that we are telling some assets.

On page 22, now we see the result of the extension that we did with Caixa Economica and this refers to some operations for 2016 and 2017 until 2022 for five years and Banco do Brasil because that was also extended for the years of 2020 and 2022.

So, why do we do that? We will have a better way to work in the steel with our selected assets and in a more stringent way, in terms of more effective funding we are now conducting some negotiations which in Japanese saying to securitize some iron-ore sales to Asia at a more attractive cost.

And here in the domestic market, there are some incentive lines line Sinapi and BNDES. Next page, when we talk about working capital management and cost reduction we are focusing on managing the inventory intermediary inventory and in terms of steel, we are looking for a constant modernization of our steel milling operation.

And also we want to reduce energy consumption. In terms of mining, we see constant improvement in the quality of our products. And also the optimization of the mine planning, processing cost reductions and reductions in our overhead. In terms of costs, expenses control, we are applying ZBD and so we are monitoring our expenses very closely.

We are also getting an extension in the payment terms with our vendors and renegotiation that we’re going to have with them. And we are looking for more competitive assets. So, last item of this financial agenda on page 24, we have more details about our business.

We reinstate therefore that we keep the focus on our core business which is steel, mining and cement. And also here we have some other available assets that will allow us to divest. And at first, we elected some assets in the U.S. We had 14% stake at Techcom. We have more than 20 companies interested in the asset.

And the proposals will begin to come in early December. We also have some participation in MRS, a stake of MRS and Itasa, Prada and Igarapava Power. I would like to say that all of the banks are ready working towards the Banco do Brasil in terms of MRS. It’s Banco do Brasil and energy assets Banco do Brasil and others credit things.

I would also like to revert to the adaptation capacity of our company particularly I know that, particularly related to our iron-ore record production which has been confident about few months.

We also promoted a heavy cost cut reduced EBITDA and iron-ore at $38 per ton and this place is amongst the best companies in the world, we’re very competitive in worldwide churn. Well the tide is well today.

We also have a very strong adaptation capacity therefore, and I refer to experts in the past, we used 90% in the domestic market and only 10% at large, today’s half and half, we fell half to the foreign market. And this chart shows how adaptive we are and how well we can adapt to the challenges in the market. Thank you very much.

Now I give the floor back to Gustavo..

Before we jump to the Q&A, I would like to give the floor to Mr. Benjamin Steinbruch for his remarks..

[Interpreted]. Good afternoon. I also have a few comments related to the recent past, the present and the future. In terms of the company last year we suffered an impact as well as the entire economy was impacted. We had a carryover inventory and also productive change also fell that impacted us in economic downturn.

Last year we also experienced a weaker year but as our September, we started doing something and I’ll tell during our steel mill production to focus on the export market that was a difficult path because we were mostly concentrated in the domestic market.

But now we are beginning to see the results which were more apparent in the first quarter of this year. We work in a different way now we are no longer operating through trading companies but to now our own teams in each, geography considering each country has internal markets.

This, it takes longer for you to see results but by the same token, we have a better sale price and lower cost when we went to sell products with high added value.

I would also tell you that is on February the economy was stagnated and as being stagnated allover particularly starting with the industrial sector, the average inventory time was three months. And the economy cut in almost half that, so intermediary stocks, inventories that each chain had to turn inventory of six months.

So that come favorably to September, there were almost no replacement purchases but we then consumed all, of the inventory with a very minor replacement factor because we were delivering promptly. We hear the steel production was x percent, we believe that the Brazilian market sale by 40%.

And we then geared our production to exports and we maintain our production but by the same token we reduce costs so as to allow us to go into the desired market, always focusing on products with high added value. We want to quality per kilogram this is our desire, this is our challenge and this is what we are pursuing.

Then, we were able to see the first results in the third quarter we were able to get a better product mix and the sales volume compatible to our production.

We, in the third quarter, we weren’t yet able to experience a full inventory reduction or the reduction that we expected but we will continue to work hard to that end, our EBITDA was 14% in the steel area which in my view was slow. And thus, was not related to cost because we were able to reduce cost.

So that slab $178 but I think we will get to $150 soon in terms of slab. But prices were under pressure in the domestic market. We are increasing prices by 8%. And probably they in the third quarter of next year we will see, I mean, they will be seen in the first quarter of next year. And this in fact is just a cost replacement.

We are working at Vale do Paraiba to reduce cost with increased prices and improve our sales mix. And this is what we’re doing in the steel area. We wanted to tell quality and could sell at a differential. And the more segment of sale in terms of market clients and products, the more successful we will have in pursuing those policies.

So in terms of the steel seeing the windows is what I had to say. The market is very challenging. The entire Brazilian economy is down. And so, we anticipated ourselves and focused on the foreign market and now with a consumption of intermediary inventory, we now have 60% of handling which is being consumed. And this is moving this productive chain.

And I believe if nothing goes wrong in terms of the economic policy, this entry, the situation tends to improve domestically. Now speaking about mining, we had a very good quarter. Our EBITDA margin was 42% as explained before. This margin in my view will get better in the fourth quarter.

And I would not be surprised if our margins reach approximately 50% in the next quarter because the price has been given the sales for the third quarter have already been concluded. And therefore all of the shipments are guaranteed. And we are constantly pursuing cost reduction. Our cost today is around $19 to $20, I mean, on the shift.

So were able to get a very, to have very competitive cost, then we are very pleased to say that it’s around $10. Our railway consumes about 5 MRS and port around 4. We believe that this $19 cost can be reduced further by 10% to $17.5 through lot of hard work in the mine and also to a better flat negotiation.

We believe that we will have a production of 3 million tons a month a year, 3 million tons a month. And our production is anticipated to be 36 million next year and we believe that this continues effort from what we’ve seen to promote for the cost reduction, certainly brighter amongst the five most competitive companies in the world.

I would also like to talk about cement. We are investing as you know to increase our production. We have this first grinding of ore already in place.

And we are now starting up with the second grading, we had problems with Volta Redonda grinding which was partially, I mean, that production interruption was replaced by the Grinding 1 at Arcos but we are working diligently so that by June of next year, we will have the clean operation. And it will improve our EBITDA margin.

Our flag movement is expensive and this was at a cost and that’s why our EBITDA was very low.

We believe that in the fourth quarter we will have a much better performance because we have new replaced styles, good logistics, the cost is very competitive and with the two grinding in addition to the new clinker kiln, our cost will be much more competitive in markets where we already operate.

Now, as to working capital, I would like to mention that unlike what we wish we could do, there was an increase in our working capital. This working capital increased about BRL595 million and basically this is due to accounts receivable at inventory.

But like I said before, our export oriented quality which is performed by ourselves, gives a normal extension in the turn considering the billing and sales is a point of destination. At the end of the day both account receivable and inventory levels are increased.

I wouldn’t say that this is desirable, well that’s a natural consequence of the policy we adopted in order to improve our prices, our margins with a unique mix of drop of value-added products that we were searching for. So, it does not justify because working capital for us is something critical right now.

We are working heavily to lower the numbers but I’m confident that Q4 will bring good news in that regard. As to CapEx, our CapEx, our investment announced to BRL1.7 billion. I know it might, you might find weird, you market analysts might find it weird but you are aware how hard it is for us to cohort credit and cash today.

So, I’d like to say that basically, these were investments in mining BRL473 million basically purchased of equipment, of growth amounting to $150 million. And that was a business opportunity we had and we can be sure there would be a cost reduction because now we have larger higher yield of equipment with fewer people involved in the operation.

So, cost reduction that you begin to see over Q3 is partly due to the start-up of new pieces of equipment and that’s why we can see the increase and also anticipation of CapEx. I would say that in terms of results this is fully justified. As to railway logistics I don’t have so many comments. EBITDA was 20% which is quite acceptable.

Likewise the same goes for port 37% EBITDA and logistics increasing revenues.

Since we are focusing our attention and management to the port of Sepetiba and also via export and also due to the largest number of container lines, so certainly in these activities of railway logistics and port logistics, we do have a huge potential of gains and net growth in EBITDA.

Regarding the outlook for the company, with the last quarter of the year Q4, rest assured that our EBITDA will be over BRL1 billion. We’ve done our homework in mining, in steel. So it’s almost certain that we will have EBITDA levels over BRL1 billion. With regards to efforts to lower our working capital, we have an important item.

And we were not successful yet in reduction but this relates to over inventory, we have BRL2.7 billion in this inventory level. And I believe we’re getting lower both easily at least at BRL1.5 billion which contributes to our liquidity and our cash. We are doing everything we can in order to better manage this item.

Net debt over EBITDA, this is critical and we’re focusing our efforts and attention. Like we said before, we are working whether it’s dispersion of assets but maybe because it’s the most important item and I would like to say that when we analyze net debt over EBITDA ratio, as you know, we look backwards one year vis-à-vis EBITDA.

The current EBITDA at the company greatly improved compared to previous months, thanks to the measures taken. I believe we should expect to see 300% EBITDA and therefore net debt over EBITDA ratio considering our efforts for working capital. If we add it all together, certainly the numbers will go down in Q4.

To conclude I would like to say that we are going to be very stringent with zero-based budgets starting January 1. We’re getting ourselves ready to start everything from scratch, OpEx, CapEx, we are so going to scrutinize and make huge efforts to manage these contracts.

With regards to CapEx, I’m confident that we’re only going we’re going to focus on the essentials. We have the conclusion of the clinker kiln, Volta Redonda coke oven plant and some efforts in shipment from mining. Since we have the production capacity that is higher today we are ready to deliver more, same is with shipment.

So, in order to increase our sales for the half of the year or for mining, since we improved our margins vis-à-vis the steel mill because the coke plant is critical for us in terms of quality and generation of gas to produce energy which does lower our cost. This will be our priority for CapEx.

As to OpEx, which today is where we have even more margins, we are going to be very stringent in order to really have huge savings and achieve the results expected in a shorter timeframe. The company is under control.

The hardest part is over and this change in order to ship production which was unit 4 in the domestic market shifting to export, but in a smart way. In order to have the better mix possible with higher value added products in better markets working at full capacity without reducing production, that’s quite a challenge in the steel industry.

But we overcame the toughest test and from now onwards, we want to read the truth. As to mining, this is what we have already thought to do in the past. In other words, we had a commercial issue, very active in sale and purchase of iron-ore. We no longer buy from third parties, it’s only in-house production and also oriented to quality and cost.

In other words, CSN in every product always related to quality and low cost. We want to be unique in qualitative terms in our products. And in terms of cost, we are focusing our efforts to lower cost. I’m not trying to be too bullish about the fourth quarter. However, being realistic, these are the conditions and efforts that would be made.

And like I said, I’m confident that we’ll be delivering great results in the fourth quarter. Economic recessions will continue but I believe that in our mode of operation, will keep on working at full capacity. And we’ll keep on trying to reduce our expenses selling unique products with more competitive prices. So, this is it. Thank you very much.

And I’ll be also here to take your questions..

[Interpreted]. Thank you. We’re opening now to question-and-answer session..

[Interpreted]. Thank you. [Operator Instructions]. The first question is from Leonardo Correa from BTG Pactual. Please go ahead, sir..

[Interpreted]. Good afternoon everyone. Thank you. My first question is about price. You mentioned 8% increase in price, basically early next year. So just to have some color about acceptance or about implementation, do you think you could have 8% on top of basically old line or anything more specific for distribution processes.

It’s the only time for us because there are some negotiations that are slightly apart, automotive for instance, sometimes it top and also some industrial players. So you get about an increase of 8%.

How do you classify it and what about the ratio and the impact? And could you also comment on the premium in the domestic markets today and if you consider the results of the third quarter of other competitors that was, a lot of discounts taken place.

And I wonder if you provide any discount to the third quarter or a renewal rather than an increase in net price. So just like to better understand the equation of price considering a challenging demand scenario and recession in 2016. My second question is about CapEx.

It was crystal clear during the presentation, Benjamin, what you said about CapEx and tradeoff. The need to spend a little bit more in the short term to reap benefits in terms of cost in the long run. So the equation for net debt over EBITDA or leverage is far from simple and the ratio is going more. CapEx is higher than the market for us, imagine.

So just to have more color, what is the plan for 2016? So what about the level that has cut down CapEx by half if necessary to try and go back to free cash flow, which is positively generated and what about CapEx for next year. So if you could give us some numbers that would be really helpful. And just to conclude Casa de Pedra, two about CapEx.

For some time now, you have been working to that standard and considering the recent interest and unfortunately, we had a tragedy of some Arcos so, what about the raising of the dam to expand Casa de Pedra? Could you give us more detail? Thank you..

[Interpreted]. Thank you. Martinez is going to answer your question about price in steel..

[Interpreted]. Hi, Leonardo, Martinez speaking. First about premium hot band today considering the price, the preliminary engines from 6% to 8%, the code coil between zero and 2% and galvanize zero to 3%, will be announced net of 8%. We haven’t already taken over part of 5% or 6% increase in distribution and civil construction.

And now we’re negotiating with companies, White Line, car parks and OEMs. The focus will be on selling more and more, or fewer amounts to more customers as to enrich the CSN mix in coated products. Benjamin talked a lot about value added products.

Just to give an idea of the magnitude, my 39% to 42% coated product and for total product for CSN as a whole, some 39% to 45%. So, what will be next is to maintain the same strategy, domestic market focus on value added product, galvanized products and increased the level of service delivered to these clients.

As to the outlook for the domestic market, what we see today, by the way another point that was not mentioned before, imports went down 52%, a product in which CSN already participates which is quite significant. Direct import and in the left, the drop was 13%.

This is also very powerful if you believe that penetration of imports in the market we’re around few million. And the same this will go down to BRL1 million in the domestic market on our lap. And part of it will also be on CSN because part of it is material that was coming in galvanized and creates zinc plat.

Another important point that is also happening and Benjamin put well that production changed by and large out of stock. So there are three drivers that would be in our favor in the fourth quarter and first quarter of next year, drop in direct import, drop in indirect product and ex-imports..

[Interpreted]. Thank you, Martinez. Gustavo speaking now. Answering your specific question about CapEx, and net debt over EBITDA.

As we give you more detail on the investment and mining equipment, in addition to acquisition price of the equipment and the market condition and financing conditions that are also very favorable, the standard investment is projected in terms of mining cost for 2016 and which levels would be fully operational vis-à-vis 2015 there would be a reduction of present in mining cost.

And in 2016 our prediction would be at least 10% higher compared to 2015. So, your point is clear, we think about it daily which is CapEx and investment, and impaired on net debt over EBITDA but there are opportunities that we cannot miss in the operation that has excellent result like mining.

And so the outlook of investment for 2016, the numbers have not been closed yet. We had announced to the market our vision is BRL1.5 billion for 2016 but naturally with anticipation we revise the number. Possibly it would be zero-based budget. And we’ll be working on essential products that are underway. Now, Daniel is going to talk about the dam..

[Interpreted]. Good afternoon, Leonardo. We were concerned with the accidents in Mariana Circumstances are very different, we’ll have different realities each mine is different. Each mine operates it’s dam slightly different from the rest and needs are also different. In spite of the Pedra, our dam is very secure and safe.

You asked about this right, it is very secure, we have stability certificate issued in compliance with the environmental regulation for the dams in the state. And this week, we had an inspection team right after the accident in Mariana, two days ago more specifically. And everything is okay.

As to the rating of the dam, that you asked we are our environmental license and permit is on schedule. And we expect it to happen business as usual as planned..

[Interpreted]. Thank you..

[Interpreted]. Our next question is from Usmat [ph] [indiscernible] from HSBC. Please go ahead sir..

[Interpreted]. Thank you, good afternoon everyone. My question regards to the consequences of the tragedy in Samarco and also the demand by fine products. What about the volume of fines and premiums. Do you think the numbers will increase that’s my first question.

Second question, I would like to have an update about a merger between Casa de Pedra Namisa, which is expected to happen in the coming months. Could you give us an update that would be really helpful. Thank you..

[Interpreted]. Thank you, Usmat [ph]. Gustavo is speaking now, and I’ll answer your second question. We are in the final process to be concluded in December this year. So far there are no problems and we expect to meet the deadline that we mentioned before.

Daniel?.

[Interpreted]. Usmat [ph], Daniel speaking. About demand for fine products we do believe there might be a window of opportunities in the short term. More specifically it is not only Samarco that was affected and other competitive company was also affected. And principle portfolio of products may be supplied by ourselves.

We decided to see that during studies in some projects to check whether at a right time if the window of opportunities really come up, we can meet and supply this principle demands in the market..

[Interpreted]. Okay, thank you..

[Interpreted]. Thank you..

[Interpreted]. Our next question is from [indiscernible] from Credit Suisse. Please go ahead sir..

[Interpreted].

Can we have some guidance about the reduction, to what extent is it due to the exchange impact or is that to cost reduction efforts? Could you give us additional guidance about how much we expect the reduction to happen?.

[Interpreted]. Over 10%, I’m sorry to interrupt, apparently we do not - listen the first part of the question, there is a problem in the connection.

Would you mind repeating please?.

[Interpreted]. Sure.

Due to all the substantial reduction in mining cost, can you break down or give us a guidance how much was an exchange effect and how much was due to cost reduction efforts and could you give us some guidance about how much is exchange and how much is effort, growing cost in the future? And maybe could you quantify your previous color about working capital going forward, considering all the improvements you’ve been making, that would be really helpful.

Thank you..

[Interpreted]. Okay. Regarding mining cost, naturally the exchange rate was favorable to us. And price and also cost because cost denominated in reais and products are in dollars but we have a real effort of reduction in reais, which is constant. So, we can say that let me just check my notes.

Production was very significant, going down approximately BRL5 per ton quarter-on-quarter. So that’s the efforts we’re making. Whenever we put down cost, the impact is on the dollar-reais in order to have sustainable long-term reduction in reais. The idea is we have a long-term impact and volatility of the exchange rate.

Although we have the perfect breakdown, but from the second to the third quarter, we had a reduction 9%. And percentage wise it is the same order of magnitude, also around 9%..

[Interpreted]. Thank you..

[Interpreted]. Our next question is from Tiago from Bank of America..

Good afternoon. Thank you for taking my question. My first question is about iron ore shipment for cutting years,- reduction of third party purchase and oncology spectra achieved 36 million tons next year. So what about the expectation for volume 2016 and going forward? Second question, maybe just to clarify.

Cost in these two segments, you quantified the cost reduction, could you repeat the number please and explain the driver that would lead to this cost reduction? That would be great. Thank you..

[Interpreted]. Thiago, this year we expect to have 28 tons next year with the production of 36 million tons. We expect to be around 30 million, that’s our guidance. And we have to see what we have in the port services and third-party services next year but at our own production, we were working on the estimate.

And going forward, depending on the investment in Casa de Pedra shipment, which is the bottleneck of production today and maybe to block the system as a whole, we might have a higher volume for 2017. As to the cost of the slab, I’m going to read in reais and dollars. Just bear with me for a second please, rechecking on this.

So, the price of the slab was $320 and in reais was BRL984 or BRL979. This reduction was due to all of our investments in revamping our city, the investments in the coke plant and also further efficiency improvement in the processes of what are we doing at that time..

[Interpreted]. Thank you..

[Interpreted]. Our next question is from Rodolfo Angele from JPMorgan. You may proceed sir..

[Interpreted]. Good afternoon.

I would like to take the opportunity that Benjamin is also participating in this call, and ask you whether you can tell us what shareholders could expect in terms of dividends in the next coming years because in the past, the company paid out a lot of dividends, what should they expect to receive more from now on?.

[Interpreted]. As I said during the conference call for the results of the previous quarter, the dividend payout now is secondary to us considering our current priority and efforts to reduce our leverage levels. I think that what can be done in operating terms to reducing cost and improving revenue and improving EBITDA is an ongoing effort.

And we have already seen the results, which we had a better third quarter. But it was a transition quarter. And in the fourth quarter, that’s when we will see a more apparent improvement in our EBITDA more in keeping with what we anticipate. In terms of indebtedness we are also taking all the possible measures.

Our EBITDA improvements are now being undertaken in terms of the sale of assets will help us with our leverage levels.

And certainly we knew that it would take at least six months, meaning that we are now receiving, we’re about to receive the first proposal because all of the banks are already working with the known assets, so demands are very promising for these assets.

And we believe that we will be able to see some more concrete results in the next quarter, in the fourth quarter. So, what’s up to us to do is being done, it’s been done. And all of our efforts to improve EBITDA there ongoing and they are [indiscernible] in the company.

Now in terms of leverage or net debt over EBITDA ratio we are negotiating our debt position. We want to reduce our indebtedness by telling [ph] assets. And any asset that will be sold it will certainly bring more cash to the company. And then we will be able to have more reserves that will be paid out in the form of dividend.

I believe that next year or about next year we will pay out dividends. But all of the other factors have to be in place for us to be able to pay out dividends..

[Interpreted]. [Operator Instructions]. Our next question comes from Victor Penna from Banco do Brasil. You may proceed..

[Interpreted]. Good afternoon, everyone. I would like to know what is the debt percentage that you were working for the milling segment, and I think that the sales of assets is higher than what has been anticipated by the company. And in terms of our industrial capacity I know that you are working towards optimizing costs etcetera.

The second question is about the rollout of the debt and whether the company another organization or whether you are looking at that matures in 2016?.

[Interpreted]. Victor, thank you. I will start with your second question about the debt. The bulk of the debt matures 2016 and ‘17 and we already initiated the rollout. And in this case, we could achieve further improvements in ‘17 but most part of our homework is done.

Could you repeat your first question because it was very difficult for us to understand..

[Interpreted].

My first question is about your percentage of utilization of capital and in case your sale of asset is made concrete if you’re considering the appreciation of what’s happened in some other peers in the industry and how do you want to work with your operating expenses?.

[Interpreted]. Okay, thank you for your question. We are working at full capacity in our Presidente Vargas mill. Our strategy, as we said, is to use our competitors [ph] both domestically and abroad. I mean, towards exports. And we have a cost differential as well, they can benefit us abroad.

Given our cost differential we are still operating in sales both in the domestic market but we are also privileging exports to the export market..

[Interpreted]. Thank you very much..

[Interpreted]. Our next question is from Eduardo Lima from HSBC. You may proceed..

[Interpreted]. My question is about both..

[Interpreted]. Eduardo, I apologize but I cannot hear your question..

[Interpreted]. I’m sorry, so I will repeat. My question is about the Volta Redonda. There is a lawsuit in the environment here and also a term of conduct that may hinder the operation of the trends.

What is the status of that case and what are the other implications stemming from that process?.

[Interpreted]. Thank you. This is a subject that was covered by the press recently and this is an important subject. Currently in all of, we are operating at Volta Redonda and we are doing everything we can as we overcome that issue. We are in the final stages of negotiations with authorities [indiscernible].

And once the situation is settled the market will be notified..

[Interpreted]. Okay..

[Interpreted]. Next question from Julia [indiscernible] Securities. You may proceed..

[Interpreted]. Good afternoon. And thank you. I would just like to have an idea, you had over BRL58 million this quarter and it went to BRL184 million.

What was that referred to and what is being financed?.

[Interpreted]. Thank you. I will have to get back to you. You are talking about related parties and there was a difference from one year to another, it’s part of our cash management. And we have to consider CSN in Brazil and abroad, there are several companies.

So I will have to get back to you, giving you more specific details that would probably help clarify your question..

[Interpreted]. Thank you..

[Interpreted]. Our next question comes from Mr. Carlos Alba from Morgan Stanley. You may proceed..

Yes, thank you very much. I just had a couple of questions. The first one is, can you give us a rough idea of the EBITDA proton that you’re making on [indiscernible]. And second is, if the big efforts and subsequently how are you reducing cost [indiscernible].

Would that maybe in ways reduce the lack of mine of the operation or how should we think about any potential impact on the long-term? Thank you..

[Interpreted]. Carlos, this is Martinez. The net margin we have in our export sales for galvanized products for the forward market is around 12% to 17%. That’s approximate of it..

[Interpreted].

Could you please repeat the second part of your question please?.

Sure. Yes, it’s just about in the proportional impact the cost reduction efforts that you are doing in Casa de Pedra could you have on the life of mine of the operation.

And how we should think about that?.

[Interpreted]. Just a second please. This is Daniel Santos. As I’ve had several times in the past, we do not do high-grading all of the improvements, are related to the high quality of our assets. We still have great amount of product in the ports and the mining plan.

Our long-term mining plan is very favorable and it favors the quality of production and high production. And we are also deploying great improvements in our process. We just introduced a new reagent unit for floatation, we also improved magnetic separators. So we are investing a lot in processes.

So, having high quality or with active feet planned with new processes, with all of that we are eligible to continue offering high quality products, Casa de Pedra will have many processes and all of these process help us transform the ore into high quality products. And with that we can keep our exploration at sustainable levels.

And costs which are continuously being reduced and through our efforts to reduce expenses on high productivity, we are keeping up to speed..

[Interpreted]. Our next question is from Marco from Itau BBA. You may proceed..

[Interpreted]. In fact this Carlos. And my question is about your cash position.

It was $1.2 billion last quarter, and so I would like to know, what will be the strategy of the company vis-à-vis your operations abroad and your position?.

[Interpreted]. Thank you. Yes, in the third quarter we managed $1.2 billion in investments abroad for Brazil. And the closing position in September, our cash position in dollars was $1.1 billion whereas 70% of our cash position denominated in dollar and Namisa accounted for $995 million.

We put together a complete hedging structure and efficiency structure for that nationalization up to this point, this amount of $1.2 billion that was part of our plan. But we have no guidance concerning what will happen in the fourth quarter..

[Interpreted]. Thank you..

[Interpreted]. As there are no further questions, I would like to give the floor back to Mr. Gustavo Sousa, Controllership, Tax Planning and IR Executive Officer for his final remarks..

[Interpreted]. Thank you all very much for joining this conference call this afternoon. If you have any additional questions, please speak to our IR Department..

[Interpreted]. Thank you very much. CSN conference call is now over. I wish you all a very good day. Thank you..