Benjamin Steinbruch - Chairman, Chief Executive Officer Luis Martinez - Commercial Director Marcelo Cunha Ribeiro - Investor Relations.

Good afternoon, and thank you for holding. At this time we would like to welcome everyone to CSN's conference call to present results for the Fourth Quarter 2021. Today we have with us the company's executive officers.

We would like to inform you that this event is being recorded and all participants will be in listen-only mode during the company presentation. Ensuing this, there will be a question-and-answer session at which time further instructions will be given. .

We have simultaneous webcast that may be accessed through CSN's Investor Relations website, ri.csn.com.br where the presentation is also available. The replay of this event will be available soon after closing for one week. You may flip over the slides at your own convenience.

Please bear in mind that some of the forward-looking statements made herein are mere expectations or trends and are based on the current assumptions and opinions of the company's management. They may differ materially from those expressed herein, as they do not constitute projections.

In fact, actual results, performance or events may differ materially from those expressed or implied by the forward-looking statements as a result of several factors, such as the general and economic conditions in Brazil and other countries, interest rates and exchange rate levels, future rescheduling or prepayment denominated in foreign currencies, protectionist measures in the U.S., Brazil and other countries, changes in laws and regulations and general competitive factors at global, regional or national basis.

We will now turn the conference over to Mr. Marcelo Cunha Ribeiro, Investor Relations Executive Officer. He will present the operating and financial highlights for the periods. You may proceed sir..

A good day to all of you! Thank you very much for joining in this earnings conference call for 2021. I have Luis Martinez, the Commercial Director and the Chairman, Benjamin Steinbruch who will make his considerations before the Q&A. I begin with a presentation, speaking about the period highlights.

Of course we have operational and financial records that are exceptional records.

We doubled the results, attaining BRL22 billion in EBITDA, almost BRL50 billion of net revenue and we are going to surpass this goal without a doubt in 2022, making the most of the excellent moment of international commodities, but also due to operational efficiency and stringency with costs.

We go on to highlight two where we were able to resolve a problem in our balance excessive leverage. We have now tuned the page. We are below our goal of 1x EBITDA; we are 0.76x with a solid cash generation and a commitment to maintain this, transforming the ability of companies of being a large capital allocating company.

Now we have already begun this journey, and we have made the most of this good moment to make transformation or moments we had the IPO of cement, important for the growth of the business and of course through the acquisitions of Cement, we will become the second Cement player in Brazil.

We go on to the next page, to speak about the details of the quarter; a very clear change between the first semester of the year and the second semester. We begin to see gradual readjustment in the price of commodities.

In the third and fourth quarter this was also continued and CSN continued a very correct strategy of margin over volume, maintaining our percentage margins very high and moving away from the records in the second semester.

In the fourth quarter we have an important impact, lower mining volumes, because of the commercial strategy, but also because of the heavy rainfall and a readjustment in the steel price. We got to EBITDA of BRL3.7 billion.

The good news is that this readjustment underwent a reversion and enables us to foresee a 2022 as good as or better than 2021, very similar to the average of 2021. We go on to the next slide where we will speak about cash generation. We begin with CapEx.

We ended the year with almost BRL$1 billion in investments as has been foreseen, getting to an annual value very close to BRL3 billion.

With that logic of increasing investments in the Presidente Vargas plant that is competitive with cohesive battery improvements, and a project for productivity and quality gain, with magnetic concentrators as well as the new fleets that will enable us to reduce costs, and then a trajectory to get to a guidance of almost BRL4 billion of CapEx in 2022 as we speed up our growth projects in mining as well as in cement.

In terms of the working capital, this semester demanded more working capital. These stocks were pressured because of the growth in raw material and because of the strategy of margin over volume. We maintained a high inventory of finished products and we're going to explore this in 2022.

We have a gradual reduction that will help us in sales as well as cash generation during that period. In the next slide we speak about cash generation. We have a semester that is different from the previous one.

BRL575 million in cash generation impacted by the EBITDA, the price of commodities that are somewhat lower, the higher volumes and in a typical working capital that of course will be reverted.

This cash flow should return to levels more similar to those of the previous semester, because this was a different fourth quarter We continue on with the evolution of net debt and we underscore that we obtained our main goal, which was to reduce leverage to less than 1x. We stand at 0.76x and it's very important to maintain this as a ceiling.

The only reason why that debt grew this semester went from BRL4.8 billion to BRL16.8 was because of the set of actions, remuneration to shareholders, buy back of shares and exchange variation.

Almost 80% of our indebtedness is packed to the dollar, where if not for that the net debt would have been relatively stable and this is a forecast to maintain net debt low and leverage below 1x. We show you our debt amortization schedule, and show you how active we have been in the last few months in liability management.

The management of liability and we lengthened indebtedness, we reduced cost and increased cash coverage. We maintained cash at high levels. BRL17 billion gives us a coverage of six years in terms of amortization.

This is the policy to maintain our cash above BRL15 million in the next quarters and all the other actions adopted to make sure that our indebtedness would become more extended. We issued the first debenture in 10 years for BRL1.5 billion. We issued the first infrastructure debenture in CSN Mineração for a period of 15 years.

We also issued an international bond, the last in the window, allowing for a reduction of our bond, lengthening the debt for another 10 years. And finally we issued our first CRI for the balance in CSN Cement. We had a good demand. We went beyond the original size foreseen and the cost was very interesting. Now this will continue.

We are going to attack these towers in 2022, 2023 and focusing on the banks that are close to CSN and that will roll over the debts for periods of four or five years lifting that pressure of short term indebtedness. We will now speak about each different business. We begin with steel, with a fantastic year.

We had an EBITDA with a growth of 300%, more than BRL2.5 million in 2020, BRL10 million in 2021. Very strong volumes, very similar to the volumes of 2020 that had been a good year. We were recovering from the pandemic, but especially in terms of prices, very strong prices around the world, not only in Brazil; United States, Europe and China.

And the good news is that we continue on at a very high trajectory in the fourth quarter. Once again that strategy of margins over volume, we had the advantage of being able to grow despite the seasonality that was unfavorable. There was a drop of more than 20% during that quarter and we were able to grow 4%.

We maintained prices in the domestic market at interesting levels and increased prices in the foreign market. Our mix was more favorable with the U.S., We increased the average price this year and our foreign business continues at a record pace.

Germany was Є10 billions of EBITDA, Portugal 60 billion in EBITDA and with a very favorable beginning of the year, which means that in the fourth quarter the EBITDA had a margin of 33%, 2.5 billion and a pace very similar to what we expect to have throughout this year.

From the viewpoint of production and cost, as you can see on the following page, it was also an interesting year. We increased the production of slab, almost 4.1 million tons, the second largest in the history of the company.

This enabled us to maintain relatively stable costs, hot cost in the fourth quarter, and even with the growth of costs and raw material, we did not have to purchase slab from third parties.

We reduced cost in real’s as well as in dollars and this helped us in EBITDA per ton that over surpassed $400, three-fold our historic average, and this is what we would like to deliver in 2022. We go on to mining in the next page.

Once again, we celebrate a year with a growth of sales and a growth in revenue of course, a growth of 6% in sales, and EBITDA with a growth of 30% and it's a year with two different histories; growing figures in the first semester, falling figures in the second semester and impact on price realization as we have sales from previous periods that were simply provisioned and therefore readjusted.

But despite this, we were able to deliver this growth. Production with a growth of almost 20% also helps us to begin the year with a very strong pace and sales higher in the fourth quarter because of the margin over volume strategy.

We decided to not sell shipments of iron ore to wait for moments that were better and also impacted within unusual volume of rainfall. Now, all of these falls or declines will be offset in the first quarter. In the next page, we see a comparison that perhaps is more fair in terms of the results of the quarter.

To eliminate the effects of previous periods, evidently this EBITDA of the fourth quarter is not representative of our recurrent results in that specific quarter. We had almost BRL500 million in impact because of provisions and shipments from previous periods. Between the third and fourth quarters, there was a negative impact.

The volume, because of the delays and the plants decline of 30% mitigated by shipments of previous quotational periods that were sold at higher prices.

So this readjustment shows you that without this reversion of provision the EBITDA will be close to BRL1.0 billion, still not representative of what we would like to deliver in 2022, a growth in volumes, and now we will have the opposite effect plants increasing to $160 and the reversion of provision will be positive, positively impacting the results for the first quarter.

We go on to the Cement business with a quarter where once again we observe growth at a moment of opposite seasonality. At the end of the year there are many halts.

Heavy rainfall that delays works, but we were able to show a growth of 9%, not only in the plants in the southeast, but integrating the acquisition in Paraíba, the Elizabeth plant responsible for 20% of our volume and growth in revenues. The cost of raw material had an impact.

We have the cost of transportation, diesel, coke and oil that also exerted pressure on the sector, but this is a proof that we will transfer these costs to prices and we will maintain the margins at the level of 2021, and continue to grow our volumes. Here you have some data from 2022 showing growth.

The growth will perhaps be lesser than previous years, but we will have good margins and will continue to grow. Well, that is the presentation of our business. We would now like to update you in terms of what we call strategic priorities. We begin with an efficient and disciplined capital allocation.

We want CSN to be a smart capital allocator and respond to its shareholders. The example we just announced is an acquisition that complements us a metal plan in Iguassu.

It’s a type of acquisition that we will continue to seek out a reasonable size, without an impact on our balance and that adds strategic value, brings us control over our distribution channel for a very specific product. This will allow us the capacity to increase our capacity of metal tin and will allow us for a more efficient distribution.

We're going to continue along these lines in terms of capital allocation, using complementary lines to add strategic value.

Regarding innovation, one more investment in CSN Inova, CSN Inova had already invested in a company, in operative company for the production of hydrogen and they have found another promising start up H2Pro, Israeli start up that works with renowned people and very important investors such as Bill Gates that are betting on hydrogen as alternative fuel, and as an alternative for the production of green.

Still this is another pillar in our search for technology to help CSN in the future with its business. To conclude, regarding ESG, we don't have Helena Guerra with us today, but she has given me the mission of sharing the good news with you, an evolution in our sustainability indicators and these efforts are being acknowledged.

We see this in the sustainability ratings for the company, globally renowned agencies like sustainability as in PM MSCI have disseminated reports all pointing to significant improvements and making CSN a benchmark for the sector in Brazil, and of course all of this is not in vain.

At the last page you can see what we have done, a very clear and transparent evolution and evolution of scores. This is because of more complex integrated reports, your reduction of CO2, our goals for decarbonization that were disseminated on CSN Day, our benchmarks in the sector in cement and mining.

We are the most efficient in the sector, our management of dams. We continue to decommission these dams, maintaining stability in 100% of them.

And in terms of security, we had one more year of strides with better indicators and in environmental management the effort is a better use of water, a better use of our residues with positive impacts, our rating agencies that have classified as better. And regarding that diversity aspect, we already have very good indicators.

The female participation with ever more ambitious goals that are advancing quickly, and in terms of the social goals, a historical mark to get to BRL100 million in the CSN Foundation to support social responsibility work for the communities around our business. This is something that gives us a great deal of pride.

With this, I would like to end the presentation. Very soon we will go on to the question-and-answer. I would now like to give the floor to the Chairman Mr. Benjamin Steinbruch. .

Thank you, Marcelo. Good day to all of you. I would like to thank all of you for your participation in the call, and express my satisfaction for being able to witness this moment where CSN has delivered, better - the best results in its 80 years.

CSN celebrates 80 years this year, and all of you know how difficult it is to work with a company in Brazil and to keep it alive and active after 80 years. And we are now celebrating these 80 years, at the very best moment, and to be alive to witness this is something that is a balm for my soul.

During the last few years for all of you who have kept up with us, that was our commitment, a commitment to deleverage the company, to maintain growth, and of course to maintain margins. This has always been our branch, and our differentiated levels of EBITDA that throughout the year allowed us to become a benchmark.

So the fact that I am here today, in which we announce the results for the last quarter and the full year 2021, is something that fills me with pride and motivation. Pride, because we did what most people did not believe in.

They did not believe that this could be done, especially the way it was done, which means that we maintain the assets, the company businesses, we left from almost nothing. We enhance the indicators in terms of margin, cash generation.

We allow the company to grow in an extraordinary fashion, not only in terms of net revenue, but also as regards EBITDA and we have deleveraged the company radically, which means that we began with 3.2 net debt EBITDA ratio in 2020 to 0.76 or 0.78 at the end of 2021, and this is a commitment that we had made to the market.

Our main priority in the company, as this was the greatest demand that we had from our shareholders, stockholders, to have a lower leverage below 1x net debt EBITDA.

So this of course is of supreme importance, and for those who feel gloating when they see the results of the fourth quarter, but don't look at the fantastic results of the company during the entire year, well this is something that offers us a great deal of satisfaction and motivation.

The fourth quarter had a significant specificity because of the drop of prices of the plant index, the heavy rainfall, exacerbation in the market as a whole. And basically because of the strategic decision made by the company we preserve the margins. We were less aggressive with the market.

We stocked up the products and we are ready in the year 2022 to reap all of the benefits of this policy. So besides thoroughly celebrating the results of 2021, what motivates us even further is that outlook that we have for 2022. And I don't want to debates this as a one-off thing. I don't want to shrink in that universe of the past and the future.

I want to have a full view of the results of the company in 2022. Everything that was hampered in the fourth quarter will be benefited, will be improved in the first quarter of 2022.

This therefore speaking of prices, of margins, market recovery or sale of inventories or stocks, we are prepared and we're going to reap the benefits that we did not have in the fourth quarter, in this first quarter.

But beyond that we have already set forth our commercial policy for the domestic market, for all of our products, which will be to add even more value and more quality to our production in whichever product, in iron ore, in the steel mill, cement, we're going to always attempt to add value, add quality to have a more horizontal distribution in the market, and to have a vertical distribution as well through the purchase of some participants, be it in the supplier chain or in the client chain, which means to say that we're going to be working in a more aggressive fashion, much more than in the past, in the domestic market.

And the basic assumption will always be quality added value and distribution.

As part of that concept of selling steel, cement and iron ore, not by ton, but by kilo, so that we can be ever closer to the end consumer, to have a consolidated, well established brand at all levels, and to work in an organized way, to be able to grow in the domestic market, and the same applies to the foreign market.

We're going to use our plants in the U.S. and Europe to enhance our distribution. We will be ever more aggressive and grow with our local production.

What we yearn is to have our own production in the USA, Germany and Portugal, to increase two-fold our activities and to carry out all of this growth that we set forth in the past; it continues to be a goal.

Going forward, we want to double the size of the company in the coming three years, maintaining our commitments in a rigorous way with the market, in terms of leverage, margins and growth. In three years we want to have a company that will be double of what it is, maintaining a very low leverage.

We have less than 1x net debt EBITDA, enhance the quality of our margins, to do this without losing margin and participating more and more in the domestic and foreign markets. These are our challenges ahead of us. We want to grow our assets outside of Brazil as we do have that concrete possibility at present.

We want to have 20% or 30% of our assets outside of Brazil for the sake of geographical diversification and this will enable us to work with that new virticalization and a more horizontal distribution for the production of what we produce.

It's with a great deal of joy that I am here alive, addressing you, delivering everything that we have promised in the last three years, and most people did not believe in this, not because of the company, but they would say that Benjamin would never reduce the debt, would never sell-off, would never give up on working with deleveraging and we have done all of this.

We have deleveraged the company with a singular growth.

Very few companies in Brazil and abroad have had the growth that we have had year-on-year and furthermore, with the margins and the results that we are delivering a net revenue of BRL14 billion and EBITDA of BRL23 billion, once again historically everybody doubted this, and I do understand that doubt.

But it has proven to be perfectly feasible to put into practice this new exercise in 2021 and for 2022, the outlook upon entering is much better than that of 2021.

The company is structured in terms of capital, the date has been extended or lengthened with 16 billion in cash, which means that we will be able to do much more than was done last year, with a business strategy that is well defined clear and already transferred on to all of the managers, so that we can be persistent and ensure that we are able to attain this growth with delivering and enhancement of margins.

I would like to thank the entire team of the company, the Board of Management, the Directors, all the workers who believed in this and were willing to make the sacrifices that they made in the years 2020 and 2021.

And we hope that they will share with us this truly extraordinary moment of a victory of success, of feeling that your hard work has reaped benefits. We share this with everybody, our employees, our shareholders, stockholders, everybody. This is a highly gratifying moment for everybody and the company and especially for me.

And I reiterate my commitment and my optimism regarding the coming years in this wonderful company that is little known by part of the market, but that will certainly be able to fulfill its potential and have it acknowledge in the coming three years. Once again, I express my pride and satisfaction from being at CSN since 1993.

I entered a company that was about to disappear and we transformed it into this very aggressive animal that is ever present, determined, searching for impossible things, searching for greater challenges.

And at a moment like this one, when it is able to deliver this type of result, all difficulties, all the work, all the dedication are something of the past and what we now want is a yearning and a commitment to deliver ever more. Thank you very much to all, and let us go on to questions-and-answers.

The executive directors are all here to respond to your questions. Thank you once again. Thank you very much. .

Thank you. Our first question is from Thiago Lofiego from Bradesco BBI. You may proceed Thiago..

Thank you, and a good afternoon to all of you. Congratulations Benjamin for the company journey trajectory. I have two questions for Martinez if you could speak about still here. First, the cost of iron ore, all that are increasing for the plans, the slab increasing as well.

What is your outlook for the price of steel in the global context? Do you think that at the end of the day, at the end of all of this confusion that we observed in the market world, still will maintain its margin or lose its margin? The second question, also in the steel context.

In Brazil, what is a demand now at the beginning of the year? If you could speak about your plan for long steel, that would be excellent to understand the market dynamic in these two statements. Thank you. .

It seems that Martinez may have a problem in returning to the call. Luis Fernando Martinez, you may proceed sir. It truly seems that Martinez’s connection has dropped. He will be back soon. I suggest Thiago, if it’s not too uncomfortable, we’ll hold onto your questions and for Martinez to answer them, and then we can go on to the next question..

Of course, no problem. Let's go on to the next question. .

Next question, and as soon as Martinez is back, we will continue again. We do apologize for this inconvenience. Operator, next question please..

Our next question is from Daniel Sasson for Itau BBA. You may proceed..

Good afternoon to all of you. Thank you for taking my questions. I reinforce the congratulations offered by Thiago to Benjamin. My question already referred to what you said at the end, reflections on the coming years of CSN, you spoke about doubling the size of the company in the coming years.

If you could remark on your plans perhaps, not only for mining, but for international expense and where we could have better upsides if you’re considering when you analyze investment opportunities to expand outside of Brazil, once again if you could refer to this angle. I have another question for Martinez as well, but we'll leave it for later.

Also along the lines of the question asked formerly, I wanted to understand the competitive environment in Brazil and how successful the latest announcements of price increases have been or not. Thank you. .

Very well.

Regarding the first question, I would like to make it very clear and decisive for you that we're going to grow the company based on the assumptions that we have mentioned, the deleveraging, that is to say to maintain 1x net debt as a reference and the main priority for all of our efforts, we're going to work with an enhancement of quality of all of our products; work with more added value as much as possible.

We want to work in a different fashion, which means to say coming or bringing the product ever closer to the consumer and perhaps by adding more services to the product and making the most of the opportunities for expansion that we observed in each of the sectors in which we work. I don't see great novelties for new types of products for the company.

We're going to continue working strongly with the steel mill, with mining, with infrastructure and logistics and of course with energy.

Now energy is one of the things we're going to invest in rapidly and invest in correctly, so that we will not only become self-sustainable in terms of generation, but will make of energy important, a large business for CSN. Basically we're going to be working on the segments that you are all aware of.

Our commitment is to increase the size of the company two-fold in the coming three years based on that assumption of deleveraging, the search for technology. We're going to become an important player in technology enhancement in our continuous search for abatement. We're already implementing this; we’re committed with it.

Always complying with what we mentioned formerly, the four pillars, basically technology and ESG. The new CSN Inova that has been working in the field of technology and ESG is much larger and much better than you can imagine.

We're going to make it better known and it will be closer to the investors, because there lies a secret, a secret that will bring you very good news for all of those who are following up with and live daily with CSN.

So our growth basically will be geared on low leverage, which is a priority, the use of technologies and greater commitments with ESG, not only in speech, but throughout our actions. We're going to work ever more in decarbonization and abatement and above this work in conservation. We're going to have very large areas that will be preserved.

They will be purchased and maintained by the company, and because of this commitment not only to decarbonize, but also to preserve and conserve and we're going to be very active along these lines and they seem to be a priority, not only for the present, but for the future for those who want to make a differentiated entrepreneurial proposal for their future.

So basically, this is it. Make the most of the opportunities in the domestic market. This was the case of Elizabeth Cimentos and LafargeHolcim.

They want to increase and whatever is offered to us in the domestic market, our acquisitions and we have the commitment for the coming three years to have 20% to 30% of our assets in the foreign market, increasing the size of those we have at present two-fold and look at the feasibility of the infrastructure and the market, so that this can be achieved.

I'm also working with greenfield projects in the United States and we are involved in this, in cement, as well as in the steel metal and we believe that in the coming three years we will be able to already count upon their full operation of course. There's the issue of the investments and yes, we have to have a return.

Everything that we do is to add quality to our margins. This is mandatory, so we will not do anything that does not respond to this, along with the leverage, along with the technology and ESG. The margins are important.

They are part of our challenge and we are going to make the most of this through a more aggressive policy from the commercial viewpoint in all of our products. This has already been set forth. It is being put into place. We do want to participate more in the market, both in the domestic and foreign markets.

We're going to verticalize inference of suppliers or clients to have a greater market share and with this have a better, a healthier distribution that is closer to the end consumer.

This is it basically, to continue doing what we were doing, among the assumptions that we have in the market and what is different now perhaps is that possibility that we have detected and where we are well advanced of investing more abroad, who have a greater geographic diversification of assets, always respecting leverage, technology ESG and quality, and ever better quality of our products.

Cooperating with the margins, the better margins that we want to deliver. This is the direction that we will follow. We’re already in movement for this and everything that we're going to – well, everything that you're going to think, of course will include these assumptions. In leveraging, we’re only going to work with very conservative leveraging.

There's Martinez..

Can you hear me?.

Yes, we do. Please join us. I'm concluding my remarks..

Very well. .

And to conclude, we have the deleveraging as our main premise technology; as the second assumption, ESG. Our sort of main assumption margin contributions for assumption and the fifth would be diversification of assets, 30% in mature and developed countries.

This is our plan for the coming three years and this will enable us to increase the size of the company two-fold based on these assumptions.

This is what I offer to all of our work associates and our shareholders and we're going to work earnestly to be able to deliver this I hope in three years, to be able to speak to you with these challenges already surpassed. Martinez, we have two questions for you. I don't know if you heard some. .

I will first of all answer the question made by Thiago, and the second, if you would be kind enough to repeat it. I do apologize. Once again a technological glitch, but everything is working.

Can you hear me?.

Yes, we do. Please continue..

Thiago, to go back to your question and to speak about the global steels situation, the cost of slabs and our outlook for the future, if we put aside all of the movements that we see in the world scenario. There is a very clear scenario of decarbonization, de-globalization as mentioned by Benjamin.

Regarding the de-globalization, we perceive more and more that the strong economies are closing up and they are producing their own steel. This is something that we have observed in Europe and the United States and generally – and the situation will not be different in Brazil.

United States is a very strong country and at present they are going through an onshoring phase, bringing several products to be produced again in the US. There is a new industrialization, the issue of ports in the U.S., all of this has contributed so that economies can become ever more de-globalized.

Now, in the world at present, to give you an idea of what is happening, we have a situation impacted by this crisis between Russia and Ukraine.

Now, in terms of prices, we have some consultations for slabs that are around $900 in the spot market, but the world will – and to increase these values because of the scarcity of products in some regions, today for example the BQ from China, the prices are $870 to $895 and the Turkish rods have increased to $900 today because of these world movements.

Now, besides these world movements, we have a very clear view of cost. The cost of coal was approximately $15; the Australian coal, which is the one that we use; and coke, $865, $800; iron ore at $270. So the world scenario of steel I think will be quite favorable, although we are undergoing conflicts in the world.

World trade will be favorable I believe for the steel sector as a whole and will enable it to recover its margins. In Brazil, to give you an idea of what is happening, we have entered a level in Brazil where we had apparent consumption of 12 million, 12.5 million tons a year.

In 2021 we ended with 15 million, a growth of 25% and for 2022 the ADR speak to the growth of 2.2%. There is a plan according to what Benjamin said, of growing a minimum of 10% in the domestic market. So we will go from 3.5 million tons in the domestic market.

Regarding exports, it is worthwhile mentioning that in 2021 the penetration in Brazil was 19% for 2022. We are estimating levels of 12%, which will bring to Brazil once again 600,000 tons that were being imported and they will be produced here, which is very favorable. Now this is the scenario of Brazil.

When we speak about markets, which are the market projections for CSN? We have a market projection, a strong one of 5% for the industry as a whole; in civil construction 4.5%; the rail road implements, agricultural trucks, 10%. This also applies to trucks, and in the distribution sector growth of 5%.

So from the viewpoint of demand, we don't foresee any problem. Demand continues to be good. There was seasonality at the end of 2021, beginning of 2022, and we have a unique opportunity of stocking up with higher prices as part of the strategy mentioned by Benjamin.

Now to reinforce the strategy besides everything that was, said and to speak about our cost paler and operational excellence, CSN no longer has any maintenance or renewal. Our equipment is ready to work at full steam. The steel mill, everything can work at full capacity.

Additionally to this and to reinforce what was said by Benjamin, we have a very good opportunity for a long term project with partnership, so that we can verticalize everything, integrate the chain better and work with acquisitions as we did with the Iguaçu Company.

And to reinforce exports, we're going to continue to work as a local player in the markets where we are present; Germany, United States and Portugal. I also believe that because of the world situation we begin to detect opportunities to export to other markets, perhaps to Turkey with BQ at very interesting values regarding the domestic price.

But our strategy, as it was in 2021 of value over volume, as Marcelo mentioned, stronger for longer, we want to increase our market share and return to the market stronger.

Now, from the viewpoint of long steel, the situation in Brazil is perhaps more favorable, because nowadays if you compare long steel with the Turkish market, the premium is -22%, negative, which is very bad. So it's a strong opportunity to recover prices if you were to make calculations of BQ in China, $800, and a dollar at 5.5.

The prices vary from 1% to slightly negative as part of that supply and demand equation and cost which is increasing strongly, the decrease of imports on the dollar rate. Without a doubt, we will have room to recover prices this month or the coming month, 8% to 10%.

So our plan is to redress the prices of the hot rolled and long plans packaging by 8% to 10%. So this is the scenario that we are observing in the domestic market, even with this very anomalous world scenario and with the pandemic last year. I do apologize for taking some time to come in. If you could repeat the second question, I can answer it. Mr.

Thiago Lofiego, your line is open. If you could repeat your question. .

I have already had my question answered. Perhaps you could open the floor for Mr. Daniel Sasson. .

Sasson had asked about competition in the Brazilian market. .

Competition in the Brazilian market, precisely. We're going to allow him to come back. If you could already begin to answer while he's coming back. .

Very well. Daniel, thank you once again for the question. Obviously Brazil at present has very important information.

In the case of CSN, we have 40% to 45% of our products that are coded products and the graders competition in the Brazilian market in coated products AHDT, the pre-painted material was very stronger then the imported material, so this scenario is quite positive.

Because of issues of an increase in world prices and the difficulties of imports, we should have in their domestic market a return of almost 700,000 tons of coated material, which means that CSN will benefit from better imports and capture the value of this material. This also applies to template.

There is very little imports and our vertical integration will improve, so that we can increase the size of the market vis-a-vis competition in packaging. Now, regarding the competition and other products, competition is stronger in terms of hot rolls, but there is no import of these hot rolls or hot rolled coils or reels.

So the market doesn't have excess capacity.

It has a very tight supply demand equation, even in hot rolling, we have a very clear strategy for working with civil construction, we are more focused on added value quality and fragmentation, and we have 75% to 80% in spot prices, so we're well positioned in different markets, different sectors, with the possibility of exporting BQ to Portugal.

Nowadays if you imagine CSN in terms of guidance for 2022, as I had mentioned, we're going to look in the domestic market for longs, 1.5 million in the foreign market, exports of 120,000 tons as a minimum that we supply with hot roll 350,000 to 400,000 SWT that is operating at full speed with very good margins, 800,000 tons in 2022 and our company and the U.S., nowadays we market our entire production, 300,000 tons.

So all of this is important, so that the plans that we have to resume an industrial address in the United States and double the production in Portugal, so that all of this can become reality. We are going to focus on the markets where we decided to participate and where we have local services. Basically this is a competition dynamic.

I don't know if there is something I did not answer. .

Thank you, Martinez. That was very clear. .

Our next question is in English, and comes from Carlos de Alba from Morgan Stanley. You may proceed. Mr. Alba. .

Yeah, thank you very much. Good morning everybody or afternoon everyone. Congratulations on the 80 years of CSN. Just a couple of questions. First maybe for Martinez.

With the acquisition of the Real that we have seen, what makes you believe that we are going to see these drop in imports into the domestic market that will be able to be captured by local producers. Maybe I’m missing something, but if you could maybe elaborate on that, given again the strong currency that would be great Martinez. And then maybe Mr.

Steinbruch, clearly very few companies in the world – let alone in our coverage would be able to double the size or per size in the next three years. But when can have more concrete details about the CapEx and the pace of this expansion and maybe more concrete plants in terms of what project specifically would take you there. .

Carlos, good day! And thank you once again for your question. I would once again explain to you why we believe we can recompose prices, comparing the domestic prices with international prices. If we go back to supply and demand, that demand in Brazil at present went through a trough because of the seasonality.

The demand is back in the first quarter, several sectors have experienced growth, a growth of 5% as a minimum; the agricultural, railway, the truck market, the market of civil construction itself.

We have several buildings that have been launched, that are presently being built and we're also capturing value there and we have the beginning of the infrastructure work.

So in terms of supply and demand, there won't be great problems, because at CSN we are also able to export spot to make the most of the world situation in terms of prices or the market share of CSN and the markets where we already exists Germany, United States, and Portugal. Now the issue of cost, there is nothing that we can do.

Our cost of slabs which presently is BRL3600 will jump to BRL4200. We have to recover this cost. The price of coal has increased 500 coke, 750 in iron ore, that will remain at $170, another important point that could be better than I imagined, because of the world trade problems in general. The trend is for imports to be reduced constantly.

So local production will be in a privileged position and nowadays if you imagine the prices in the market with the trend for rising BQ at $895 exchange at 5.05 and a BQ in the domestic market of BRL5800 the premium is on note, slightly negative.

So this will support that possibility of increasing prices by 8% to 10% in the hot rolled, cold rolled zinc projects and coated products and template. This is the logic that we are basing ourselves on to recover prices in the domestic market. .

To add to what Martinez has just answered for Carlos, our strategy for growth and our market vision, as I mentioned formerly, will contemplate the purchase of suppliers and clients in the market, which means that besides servicing the traditional market that we already had, we will have a growth that will go beyond the normal growth, because we want to add value to our products.

We also want to add services, so all of this, represents a different attack in the traditional market because we are offering services and we are willing to acquire some suppliers and clients to have a more diversified market with a greater potential. So, all of this will contribute towards this growth in the domestic market.

We're not considering a normal market growth, we are r projecting an additional growth, through this process of virtualization of suppliers and clients, so that we can expand this market outside of the normal growth and with this idea of being closer to the end consumer, offerings services as well, based on mutual agreements of course.

So this for the domestic steel market in terms of mining, our approach will be different as well. Besides the projects that we already have, and besides the purchase of iron and ore we are going to offer, smaller companies the opportunity of working on our reserves in a partnership.

Whatever is not our priority in terms of exploitation of mineral reserves, we're going to offer to third parties that are more aggressive, have greater flexibility and are willing to work there.

We're going to invite them to participate in the exploitation of these reserves in short periods of time, to complement our efforts in production, with the purchase of products and the production of third parties as well.

So, this market growth domestically and in the foreign market is based on these assumptions and the proposal is very different, quite unique compared to what others are doing. Regarding gross, Carlos, I think that you can look in their rear view mirror and look at the growth that CSN has had in the last two years. There are unique growths.

They are difficult to understand how a company can grow 70% year-on-year in enhancing the EBITDA margins and deleveraging. But all of this is because we have a good quality of assets that were not acknowledged by the market. This is what has allowed us to do this.

Now as I mentioned regarding the market, we're going to be very aggressive, more flexible and more determined when it comes to buying out the market, and this also refers to assets. Our priority is to acquire ready assets. This is our preference, to buy assets that are ready to develop Greenfield projects. And this of course will bolster our growth.

If you look at cements, we’re going to go from 6 million tons to 16 million, a significant growth and eventually we will work with M&A’s in the domestic market and M&A’s in the foreign market in cement. With mining I have already explained this, and the same applies for steel.

We are looking and searching for assets that are ready, that will have a good fit with our strategy and that will at least contribute towards our margins. Now international diversification.

We are speaking of $2 billion to $3 billion that will be invested as well, between ready assets and Greenfield projects, now always considering the leverage and margin contribution. Therefore, it has been much more difficult to look at the year 2020 and 2022 – 2021, I'm sorry, in terms of growth and the search for an adequate capital structure.

So that we could share this growth with then reduction of indebtedness and an improvement of margin; all of this compared with 2022, 2023 and 2024. I look upon the future more calmly than the past.

Our last three years were based on determination, arduous work struggle, becoming convinced of what we wanted to do, but all of this will help us in the coming three years.

We have spoken to the rating agencies and with these results we hope to get to investment grade, which is what we desire and of course this will facilitate the fund raising and understanding of our capital structure and will enable us to work at a faster pace and a lower cost.

With these results and what is a continuous improvement and growth in our results, we will have his investment grade. We should obtain it in the coming months. For me this would be unacceptable that they not acknowledge the improvement of quality in the capital structure of the company, these are figures they're not words.

So this should allow us to overcome a great difficulty that we had in the call. I see so many opportunities Carlos to speak to you very transparently. If you look at the energy sector, we would like to have a threefold increase with investments and returns that make sense. I'm not speaking of anything new.

I'm speaking of acquiring something that is in the market and that are being surveyed for the short term without a doubt, and complying with the assumptions of deleveraging, technology, ESG and margin enhancements in the coming six months.

All of this will be drawn up and perhaps fulfilled with full guaranteed to the market that we're not going to go beyond that one-time net debt EBITDA. We do have reserves that enable us to do this.

We have good movements, we have a protection, we have shares from that have a very good value and that without a doubt would help us to carry out these investments without having to change our leverage.

There does exist that possibility, because of the margins that we have obtained in the businesses and this gives us tranquility along with the stocks that we have.

We're sure that we will be able to do this, always complying with those premises and the commitment with the market and making the most of these sales of assets of other companies, that would be very complimentary in our portfolio and you will see that in three years the company will at least have doubled in size. .

Thank you very much. .

. Thank you. As we have no further questions, I would like to turn the floor over to Mr. Marcelo Cunha Ribeiro, Executive IR Officer. Mr. Cunha, you can continue with your closing remarks. .

I would like to close by sharing our enthusiasm with the year 2022. It will be better than our record year 2021. We thank all of your for your participation. We wish you a very good day and we hope to see you in our next earnings call. Thank you very much. .

The earnings results call for CSN ends here.

You can now disconnect and have a good day!.