Table of Contents

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Company Information / Capital Breakdown

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2022 MANAGEMENT REPORT

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“ In 2022, CSN took important steps in diversifying its business strategy. The company completed the acquisition of LafargeHolcim Brasil's assets, CEEE-G, and other energy-related assets, resulting in an increasingly diverse, efficient operation with great growth potential and solid sustainable attributes rooted in the group's culture. As a result, CSN, which was created more than 80 years ago as a steelmaker, now operates prominently in four other sectors vital to Brazil's development: mining, cement, logistics, and energy.

In the cement segment, the company consolidated itself as the second-largest producer in the country last year, with an operational capacity of 17 million tons per year with relevant competitive advantages, such as strong brands, diversified portfolio, market presence in key regions of Brazil, and efficient plants from both a financial and low-carbon emissions perspective. It is quite an achievement for a company that, in just over ten years of operation, already occupies the sector's vice-leadership and has plans to increase its market share both domestically and internationally.

In energy, the acquisition of CEEE-G, in addition to providing self-sufficiency to supply steelmaking, cement, and mining activities, positions the company as one of the country's main generators, ranking among the top 11 in the sector. With expansion plans scheduled for the next years, that involve opportunities in hydraulic, wind, and solar projects, the energy segment has ceased to be a support area and has effectively consolidated as a business, as the percentage generated but not used for the group's own consumption will be traded in the free market. This strategy ensures greater competitiveness to meet growing operational demands and reinforces the company's ESG policy concern, as it now operates with 100% renewable energy sources.

In mining, the growth strategy is linked to projects to increase production capacity, especially the P15 beneficiation plant, P4, and tailings recovery projects in Pires, B4, and Casa de Pedra, projects that aim to double the Company's production volume in the coming years. Another highlight concerns CSN Mineração's pioneering work in conducting a dam decharacterization program that exceeds government requirements by providing decharacterization of structures regardless of construction method, such as the Casa de Pedra dam. The sustainable P15 high-grade pellet feed plant is born with a completely dry stacking tailings project, reinforcing the company's purpose of having a mining operation free from dam use. Additionally, the projects will work with beneficiation plants that will deliver a premium ore with high iron content and require less coal use in the steelmaking process, contributing significantly to the industry's decarbonization and therefore being more valued by the market.

In the steel industry, expansion plans involve the Company internationalization, with efforts focused on seeking opportunities to increase its presence abroad. In addition, modernization of the industrial park remains a priority, with an investment plan for various areas of the steel plant aimed at increasing efficiency and competitiveness, including reducing operational bottlenecks. There are also opportunities being studied, with advancements in the value chain, including the development of strategic projects, always respecting capital discipline. Among them is the expansion of production capacity for metallic sheets and pre-painted steel.

The company also continues to play a prominent role in driving decarbonization in the steel sector, betting on technologies that will enable traditional industries to transition to a new, greener, and more connected model, in line with one of CSN Group's ambitions for 2050, which is to provide carbon-neutral materials to the market. This movement is led by CSN Inova, which through its investment vehicle - CSN Inova Ventures - invests in startups to support the technological and commercial scaling of solutions, not only on issues related to a carbon-free future but also on topics related to other investment verticals, such as circular economy, water resources, operational efficiency, industrial digitization, logistics, and inventory management. In 2022, CSN Inova Ventures was recognized as the most active fund in Brazil by Corporate Venture in Brazil, an initiative developed to stimulate venture capital investments in the country and intends to continue at the same pace going forward.

Another recognition to be celebrated by the group concerns its progress in two important ESG ratings. The company received a new rating from the agency Sustainalytics, in which, of the 155 steel and mining companies evaluated globally, CSN achieved the 4th best score in the sector. The company was also the only Brazilian company in the steel, mining, and construction sectors eligible to be included in the S&P Global Sustainability Yearbook 2023, being classified as the company in the steel segment that has advanced the most in ESG practices worldwide, receiving the "Industry Mover" seal.

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The company also remained dedicated to the inclusion of women and people with disabilities (PwDs). Female participation in the group increased from 17.5% in 2021 to 20.5% last year. The goal is to increase this index to 28% by 2025. Regarding the representation of people with disabilities, the growth in 2022 was significant, with a 16% increase compared to the previous year. Progress in this area reinforces the commitment for CSN to be increasingly pluralistic, diverse, and inclusive.

The health and safety of people are our top priority. In 2022, we reached the lowest historical level of accidents frequency rate, with and without absenteeism, of own and third-party employees per million man-hours worked. The indicator was 1.79, a decrease of approximately 25% compared to 2021. This is the best result in the last eight years and the highest percentage reduction since the compilation of data from the units began in 2014, setting a new milestone for the CSN Group. The drop in these rates reinforces the company's concern and dedication to promoting increasingly safe work environments and conditions for its employees.

Regarding the progress expected for the coming years, the focus is on maintaining the same growth rate presented in recent years, which has caused CSN to change its profitability and cash generation level, bringing a much stronger balance sheet with low leverage. Vertical integration and the relentless pursuit of new internal and external opportunities, both for growth and cost reduction, make up the scenario to boost future results and pave the way to transform CSN into an increasingly dynamic holding company in the global economy. Despite the focus on growth, the company remains committed to maintaining low leverage and aims to differentiate itself as a company that can deliver often conflicting results but has already proven to be possible by combining leverage reduction with rapid growth and dividend returns to its shareholders. These three commitments guide the actions of the entire group and create an orchestrated strategy for the company to grow in a healthy, sustainable way and increase shareholder value. With the focus and determination as always, the group will continue to pursue these objectives and be attentive to the best opportunities to generate value for all stakeholders.

Together we will continue to do well, more, and forever!"

Benjamin Steinbruch

Chairman of the Board of Directors

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With businesses in steelmaking, mining, cement, logistics, and energy, Companhia Siderúrgica Nacional ("CSN" or "Company") operates in an integrated manner throughout the steel production chain, from iron ore extraction to the production and commercialization of a diversified line of high-value-added steel products. In addition, the Company is increasingly dynamic in mining, cement, and energy markets, with a diverse and sustainable operation. The integrated production system, combined with quality management, means that CSN has one of the lowest production costs in the businesses in which it operates.

CSN has an installed capacity of 6.5 million tons of steel, with 5.2 million tons of flat steel and 1.3 million tons of long steel (0.2 million at UPV and 1.1 million at SWT), and the volume sold in 2022 reached 4.4 million tons. Of this total, 70% was sold in the domestic market and 30% was exported or sold through its subsidiaries abroad.

In the mining segment, there was an annual increase of 0.3% in sales in 2022, showing greater penetration by CSN in the international market, even with the negative impacts of the Chinese market throughout the year, with production stops at steel mills, heat waves, and a crisis in the real estate sector. On the production side, the company ended the year with 34.1 million tons produced.

In the cement segment, 2022 was an extremely important year for CSN, with the completion of the acquisition of Cimentos Brasil's operations, making the Company the second largest producer in the country. In the Brazilian market, sales totaled 63 million tons in 2022, which represents a decrease of 2.8% compared to 2021. But for CSN, there was an annual growth of 53.8% in sales volume, as a result of the assertive commercial strategy and the incorporation of Cimentos Brasil in the second half of the year.

The year 2022 was also historic for the Company's energy segment operations, with the acquisition of four operations that increased installed capacity by 1,066.3MW, in addition to adding another 356MW in minority interests. With this, the Company not only became self-sufficient but also began to have excess energy that will be subsequently sold in the free market, making the segment a true business unit for CSN. Additionally, the benefit of self-production will allow a reduction of approximately 60% in energy costs, bringing significant impacts on the profitability of the segments.

3- PERSPECTIVES, STRATEGIES, AND INVESTMENTS

In the five segments it operates, CSN has been investing to expand the competitive advantages of its units and in reviewing its portfolio of businesses and projects, seeking to maximize returns to its shareholders.

3.1- STEEL

The Usina Presidente Vargas Plant in Volta Redonda is the main steel production unit of CSN, with an installed capacity of 5.6 million tons of crude steel production, of which 5.2 million tons are flat steel and 0.4 million tons are long steel. In 2022, the plant produced 3,594 thousand tons of crude steel, of which 3,378 thousand tons were flat steel and 216 thousand tons were long steel, while the production of laminated steel reached 3,378 thousand tons. In addition to its units in Brazil, the company has two subsidiaries abroad: Lusosider, located in Portugal, and SWT-Stahlwerk Thuringen in Germany.

3.2- MIINING

In 2022, CSN sold around 33.3 million tons of iron ore, of which 4.1 million tons were destined for the Usina Presidente Vargas Plant, while the rest was exported to the international market. The TECAR port terminal, operated by CSN Mineração S.A. and located in the Port of Itaguaí, shipped about 28 million tons of iron ore in 2022, and the remaining amount was exported via Porto Sudeste.

3.3 – CEMENT

In 2022, CSN made history by consolidating its strategy in the cement sector through the integration of its acquired operations. As a result, the sold volume in 2022 was 7,243 kton, 54% higher than that recorded in 2021. This was not only due to the strong performance observed in the segment throughout the year, but also from the incorporation of Cimentos Brasil S.A. With this, the Company became the second-largest cement producer in the country and intends to continue growing by capturing synergies and also through organic expansion projects.

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3.4 – ENERGY

In 2022, the energy segment was effectively consolidated as a business unit of the Company, with CSN having surplus energy to sell in the free market. In addition, the latest acquisitions allowed the Company to achieve electrical energy self-sufficiency, a milestone that will support all business segments with significantly lower energy costs. After integrating all acquired assets, the revenue of CSN's energy segment reached BRL 291 million in 2022, an increase of 30.5% compared to the previous year.

3.5 – LOGISTICS

Ports

TECON is a port controlled by Sepetiba Tecon S.A., a company owned by CSN, is positioned as the largest container terminal in the state of Rio de Janeiro and one of the largest in Brazil in this segment. TECON currently has a capacity of 660,000 annual TEUs (Twenty-Foot Equivalent Unit).

CSN has participation in three railway companies: MRS Logística S.A., Transnordestina Logística S.A., and FTL - Ferrovia Transnordestina Logística.

MRS Logística S.A. (“MRS”)

CSN directly holds a 18.64% stake in the total social capital of MRS and indirectly, through its subsidiary CSN Mineração, a 18.63% stake, totaling 37.27% of the total social capital of MRS, which operates the former Southeast Network of Rede Ferroviária Federal S.A (RFFSA), in the Rio de Janeiro - São Paulo - Belo Horizonte axis.

The main business segment of MRS is the transportation of Heavy Haul cargoes (ore, coal, and coke), having transported approximately 106.5 million tons of these products in 2022, equivalent to 59.8% of the total transported by MRS. Recently, MRS has been following a strategy of diversifying the transported cargo with an increase in General Cargo, which accounted for 40.1% of the mix transported in 2022 (including the volume related to the right of passage of other railways).

The railway transport services provided by MRS are essential for the supply of raw materials and the transportation of final products. The entirety of the iron ore, coal, and coke consumed by Usina Presidente Vargas is transported by MRS, as well as part of the steel produced by CSN.

Transnordestina Logística S.A. (“TLSA”)

TLSA holds the concession for the construction and operation of the Nova Transnordestina railway. The projected operating capacity of the railway will be 30 million tons/year and is expected to play an important role in the development of the Northeast region, creating a logistical option for sectors such as oil and derivatives, agriculture, and mining, among others.

FTL - Ferrovia Transnordestina Logística S.A. (“FTL”)

FTL holds the concession for the former Northeast railway network of RFFSA, which runs through seven states: Maranhão, Piauí, Ceará, Rio Grande do Norte, Paraíba, Pernambuco, and Alagoas, with a total extension of 4,534 km. In 2022, FTL transported around 2.9 million ton/usable (TU), with emphasis on the transportation of fuel, cement, pulp, among others. Currently, FTL operates a railway network that connects the states of Maranhão, Piauí, and Ceará along 1,191 km, with part of its stretch between São Luis and Teresina undergoing a remodeling process. The other railway stretches are suspended, under negotiation for their return to the National Land Transportation Agency (ANTT) and the National Department of Infrastructure and Transportation (DNIT).

On April 11, 2022, CSN Cimentos S.A. and CSN Energia S.A., private companies controlled by CSN, entered into a share purchase agreement ("Agreement") with Brookfield Americas Infrastructure (Brazil Power), an investment fund managed by Brookfield Brasil Asset Management Investimentos Ltda., on April 8, 2022, to acquire 100% (one hundred percent) of the shares issued by Santa Ana Energética S.A. ("Santa Ana"), the holder of the concession for the operation of the Santa Ana Small Hydroelectric Power Plant ("Santa Ana SHP"), as well as Topázio Energética S.A. ("Topázio") and, indirectly, Brasil Central Energia Ltda. ("BCE"), a subsidiary of Topázio, holder of the concession for the operation of the Sacre II Small Hydroelectric Power Plant ("Sacre SHP" and, together with Santa Ana SHP, the "SHPs"), with the Company guaranteeing the obligations of CSN Cimentos and CSN Energia ("Transaction"). On June 30, 2022, the Company published, through a Material Fact, the Closing of the acquisition of the energy companies after mentioned.

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On July 4, 2022, the Company announced that CSN Energia S.A., a CSN-controlled company, entered into a share purchase agreement for the acquisition of 100% of the shares issued by Companhia Energética Chapecó S/A - CEC, the concession holder for the operation of the Quebra-Queixo Hydroelectric Power Plant. On July 25, 2022, CSN assigned and transferred to CSN Mineração S.A. the rights and obligations of CSN resulting from the Share Purchase Agreement executed on July 1, 2022, between CSN, CSN Energia S.A., and Astra Infraestrutura I Fundo de Investimento em Participação Multiestratégia, an investment fund managed by Reag Administradora de Recursos Ltda.

On July 29, 2022, Companhia Florestal do Brasil S.A., a CSN-controlled company, was the winning bidder in the auction procedure, held under the terms of Edital nº 01/2022, for the acquisition of shares representing 66.23% of the share capital of Companhia Estadual de Geração de Energia Elétrica - CEEE-G, for a total price of BRL 928,000,000.00 (nine hundred and twenty-eight million Brazilian Reais). On October 21, 2022, the Company published the Closing of this transaction, and on December 22, 2022, CSN informed the market that the transfer of shares representing 32.74% of the share capital of CEEE-G, for the amount of BRL 367,000,000.00, was completed by Centrais Elétricas Brasileiras S/A to Companhia Florestal do Brasil. With the completion of this transfer, CFB holds a total of 99% of the share capital of CEEE-G.

On August 16, 2022, CSN announced to the market, along with Metalgráfica Iguaçu S.A, the combination of both companies' operations through the incorporation of all of Metalgráfica Iguaçu S.A's issued shares by CSN, with the intervention and consent of Metalgráfica. With this operation, Metalgráfica became a wholly owned subsidiary of CSN.

On September 6, 2022, the Company informed its shareholders that CSN Cimentos S.A., controlled by CSN, completed the acquisition of 100% of the issued shares of LafargeHolcim (Brasil) S.A., as provided for in the share purchase agreement entered into on September 9, 2021. In view of the completion of the Operation, LafargeHolcim Brazil was renamed to "CSN Cimentos Brasil S.A.", becoming a wholly owned subsidiary of CSN Cimentos.

5 – CORPORAE GOVERNANCE

Investor Relations

CSN continues to expand its communication channels, aiming to maintain transparency and exposure of the company through new coverage by financial institutions and participation in events and conferences.

Share Capital

The share capital of CSN is divided into 1,326,093,947 common and book-entry shares, without nominal value, with each common share entitling the holder to one vote at the General Shareholders' Meetings. Controlled by Vicunha Aços S.A. and Rio Iaco Participações S.A., which hold 51.24% and 3.45% of CSN's total capital, respectively, the Company's management is the responsibility of the Board of Directors and the Executive Board.

CSN - Composition of The Share Capital on 12/31/2022 (%)

*Controlling Group

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On May 18, 2022, the Company announced the approval of the opening of a new Stock Repurchase Program for the acquisition, during the period from May 19, 2022, to May 18, 2023, of up to 58,000,000 (fifty-eight million) common shares issued by the Company. The Company has not yet repurchased any shares since the Relevant Fact was published.

Shareholders' General Meeting

Once a year, as established by law, shareholders gather at the Annual General Meeting to deliberate on the accounts presented by the administrators, the financial statements, the allocation of the exercise result, eventual dividend distribution, and every two years, also deliberate on the election of members of the Board of Directors. The Extraordinary General Meeting also takes place whenever necessary, to deliberate on matters that are not within the ordinary competence.

Board of Directors

The Board of Directors is composed of up to eleven members, who meet regularly on scheduled dates in an annual calendar, at least once every quarter and, extraordinarily, whenever necessary. The Directors' term is two years, with the possibility of re-election. Currently, the Board of Directors is composed of five members. The Board of Directors, among other duties, must define and monitor the policies and strategies of the Company, monitor the acts of the Executive Board and decide on relevant matters involving the Company's business and operations. It is responsible for the election and removal of members of the Executive Board and may also, if necessary, create special committees for its advice.

Executive Board

The Executive Board comprises two to nine Executive Directors, who meet whenever called by the Chief Executive Officer or by two Executive Directors. The Executive Directors’ term of office is two years, with reelection permitted. The Executive Board is currently composed by seven Executive Directors, one of them being the Chief Executive Officer. Observing the guidelines and resolutions of the Board of Directors and the General Meeting, the Executive Board has the powers of administrating and managing the Company's corporate business.

Fiscal Council

The Fiscal Council Committee, which operates on a non-permanent basis, is currently installed, with a mandate until the Annual General Meeting to be held on 04/28/2023 and is composed of three effective members and three alternate members, one effective member and one alternate member were indicated by the Company's minority shareholders. The main function of the Audit Committee is to supervise the management acts and verify compliance with their legal and statutory duties. In addition, the Fiscal Council is also responsible for examining the quarterly information and the financial statements prepared by the Company, giving an opinion on the annual management report and the proposals of the management bodies to be submitted to the General Meeting.

Audit Committee

The Audit Committee is composed of three independent members, elected by the Board of Directors, with a 2-year term of office. The Audit Committee ordinarily meets at least once every quarter and, extraordinarily, whenever necessary. The Audit Committee has autonomy to carry out duties regarding the provisions of the Sarbanes-Oxley Act - Sections 301 and 407. The Company recommends to the Board of Directors the indication, remuneration and hiring of an external auditor, as well as monitoring the performance of internal and external audits.

Internal Audit

CSN has an Audit, Risks and Compliance Board, with independent action within the organization, linked to the Company's Board of Directors, pursuant to Article 19, VIII of the bylaws. The Internal Audit team has its own methodology and tools to carry out its activities, in line with the best market practices and adopting a systematic and disciplined approach, acting objectively and independently in carrying out its work, to reach the effectiveness of controls and consequent improvement of risk management, control and governance processes, as well as fraud prevention, reporting the results to the Board of Directors through the Audit Committee.

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Independent Auditors

The independent auditors, Mazars Auditores Independentes - Sociedade Simples Ltda., whom in 2022 provided services to CSN and its subsidiaries, were hired to issue a conclusion on the quarterly financial statements and opinion on the Company's annual financial statements and additional services to the examination of financial statements. It is the understanding of both, the Company and its independent auditors, that such services do not affect the independence of the auditors.

The services provided by the external auditors, in addition to examining the financial statements, are previously presented to the Audit Committee so that it can conclude, in accordance with the relevant legislation, whether such services, by their nature, do not represent a conflict of interest or affect the independence and objectivity of the independent auditors. Pursuant to CVM Resolution 59/2021, former CVM Instruction 480/2009, the Board of Directors declared on 03/08/2023 that it discussed, reviewed, and agreed with the opinions expressed in the opinion of the independent auditors and with the financial statements for the year social ended on December 31, 2022.

Sarbanes-Oxley Act

The Company has in its corporate governance structure the Audit, Risks and Compliance Board, which has as one of its attributions the assessment of risks that may impact the financial statements and definition of internal controls to mitigate them, together with the managers responsible for business processes. The Company assesses the effectiveness of its internal control structure, in accordance with the principles established in COSO 2013 and in compliance with the Sarbanes-Oxley Act, and the result of this assessment is reported to senior management and the Audit Committee.

In an evaluation of the internal controls by management, together with the external auditor, the Company did not identify a material weakness on December 31, 2022. The Company is in the final stage of evaluating the internal controls for 2023, in compliance with section 404 of the Law Sarbanes-Oxley.

Code of Ethics

The Company has a code of ethics approved by the Board of Directors, covering principles applied in compliance with the Anti-Corruption Law (12,846/13). The code is applicable to all employees, advisors, and directors, and establishes ethical principles and responsibilities for third parties, considering suppliers, service providers and any intermediary agents and associates. The code is made available to all employees and business partners and is used as a declaration of assumed commitments of conduct. Its guidelines are public and can be found on CSN's website, at the electronic address (www.csn.com.br).

The Audit, Risks and Compliance Board is responsible for the Integrity Program, which aims to ensure compliance with ethical standards of conduct in the exercise of activities and transparency in business. Continuous employee training and monitoring of compliance with laws, regulations, policies, and internal rules are part of this process.

The Company also has reporting channels for reports of misconduct or suspicions. The reporting of complaints by employees, third parties and the external public may be anonymous or identified, maintaining secrecy, confidentiality, and the guarantee of non-retaliation. Complaints are handled by the Audit Management, which reports to the Audit, Risks and Compliance Board and reported to the Audit Committee.

Disclosure of Material Acts and Facts

CSN has a Policy for Disclosure of Relevant Acts or Facts and Securities Trading, according to which all disclosure must be made with reliable, adequate, and transparent data, within the established deadlines and with homogeneity, as established in CVM Instruction 44/2021, former CVM Instruction 358/2002, and section 409 – Real Time Disclosure, of the Sarbanes-Oxley Act. Said policy establishes that the Company's Relevant Acts and Facts must be published through the News Portal of Folha de São Paulo, together with the disclosure on the Company's Investor Relations websites, the Securities Commission and B3 S.A. – the Brazilian stock exchange.

(In thousands of reais - R$, unless otherwise stated)

6- INNOVATION

Innovation is another strategic pillar for CSN and a lever for sustainable growth. That being said, since 2018 the Company has been strengthening CSN Inova, an innovation platform that catalyzes the transformation of our businesses towards management that is even more focused on ESG.

With four pillars of action focused on resolving the CSN Group's challenges, CSN Inova has complementary tools to implement innovation strategies with impact in the short, medium, and long term. Aiming to decarbonize CSN's production processes and generate more efficiency in our operations, CSN Inova prioritizes development projects, partnerships and investments in technologies and solutions for industry 4.0, new production routes, digital transformation, data science, new materials, and the circular economy.

On the first front, CSN Inova Open conducts a systemic and collaborative innovation process, aimed at solving strategic challenges that represent a high operational, social-environmental, and financial impact for the Company. The challenges currently prioritized are: reducing the consumption of fossil fuels and energy, increasing the availability of assets, reducing logistical expenses, digitizing and optimizing processes for decision-making based on data, new products and materials, environmental recovery and reuse of waste and new forms of payment and financing to increase sales.

The innovation management methodology takes into account the elements of open innovation and is based on an in-depth diagnosis, which involves mapping processes in the Company's various segments, areas and operations, including the analysis of pain points and related indicators. Based on these diagnoses, pilot projects (with reduced scope and quick implementation) are built and executed to test technologies and solutions that adhere to the mapped challenges. After evaluating these pilots using measurable indicators, the initiatives are escalated in an organized manner within the CSN Group's businesses.

In 2022, of the 55 initiatives underway, 21 were in the planning phase, 23 were piloted and 11 were being scaled – which demonstrates the maturity of CSN Inova's portfolio. The main objective of innovation management is to prioritize challenges and projects that are in fact relevant to the company, and such prioritization is carried out based on strategic alignment with the business, the materiality matrix, technological maturity, economic potential and, above all, in operational and financial indicators.

On the second front, CSN Inova Ventures is one of the first Brazilian corporate venture capital vehicles focused on industry 4.0 and responsible for bringing the Group closer to startups and solutions in Brazil and abroad, in addition to agents that are a reference in the venture capital ecosystem, such as Endeavor, ABVCAP, BR Angels, investment funds and accelerators. The objective is to capture the best investment opportunities in disruptive technologies with high growth potential and that allow the transition from traditional industries to a more intelligent, connected, and sustainable future.

CSN Inova Ventures' thesis focuses on companies in the Seed, Series A and Series B stages, whose solutions are aligned with one of the investment verticals, also having part of its capital committed to adjacent opportunities. In 2022, part of the portfolio investees of CSN Inova Ventures already operated and acted together with the Group.

CSN Inova Ventures ended 2022 with eight companies in its portfolio, with investments made through contributions between BRL 1 million and BRL 10 million, with new contributions expected to be made throughout 2023 starting in the 1st quarter, maintaining the focus on the verticals of investment, defined according to the operational challenges of the CSN Group.

Furthermore, as of the constitution of the ESG Committee in February 2021, CSN Inova Ventures has also consolidated itself as one of the first corporate venture capital vehicles in the world, one of whose theses, the ESG Transition, is integrated to act as a tool of transition, seeking technologies that boost the agenda of goals, strategy, and main objectives of each of the Group's material sustainability topics. The integration of CSN Inova Ventures' activities into the social-environmental transition strategy contributes to the Group's agility in accelerating its sustainability agenda.

On the third front, with the aim of ensuring the continuity of the Group's operations and the evolution of its development purpose, CSN Inova Bridge is responsible for the integrated management of the Group's ESG innovation strategy, working together with various leaders and areas of businesses to identify how, with whom and what are the main challenges and transition opportunities related to the Group's materiality matrix. The ESG Committee, which advises CSN's Board of Directors, for example, is the result of extensive research on governance models in sustainability and innovation in public companies, banks, funds, and academia conducted by CSN Inova Bridge. The Committee operates as a social-environmental innovation laboratory, whose risks and opportunities are discussed based on the Company's sustainability materiality matrix in a systemic, integrated, experimental and participatory manner. Always in a network and with multidisciplinary teams from operations to corporate, it unlocks and leverages resources for critical structural projects, mobilizes the connection between knowledge of the social innovation ecosystem and trains employees in order to stimulate the dissemination and scale of the culture of sustainability. In addition, it centralizes the ESG communication activities of the businesses, in an effort to gradually establish transparent communication with its stakeholders.

(In thousands of reais - R$, unless otherwise stated)

Finally, on the fourth front, CSN Inova Tech evaluates technologies and executes projects for the development of technological routes. In 2022, more than 10 different types of technologies related to new technological routes and new materials/fuels were evaluated. Among the projects prioritized that year, the projects for the use of green hydrogen in the Steel Industry stand out, such as the implementation of Utis technology and the Selene Project, created to decarbonize a lamination unit of the Group. In addition, the 2022 project portfolio includes the development of new technological routes for the processing of steel slag and the evaluation of technologies to produce pellets and cold agglomerated briquettes, that is, without the consumption of fossil fuels.

CSN Inova Tech also acts as a radar for trends in the most promising technologies for the sectors in which CSN operates. In this sense, for 2023, technologies associated with carbon capture will be evaluated and their respective possible use cases at CSN will be considered for the implementation of new projects in the Group.

Finally, for challenges in which technologies are at lower maturity levels and require R&D, CSN Inova Tech brings business closer to universities and research centers in Brazil and abroad, encouraging the creation of projects for technology development.

Research, Development, and Innovation Center

CSN has had a Research, Development, and Innovation Center in Volta Redonda (RJ) for 73 years. With a completely national activity, its main objective is the development of new steel products, keeping the portfolio of steel solutions up to date for all market segments served by the Company.

In the last six years, around BRL 20 million has been invested in new technologies to expand analysis capacity and innovation opportunities. The first major result of these investments was the Simulation and Virtual Reality Laboratory, which started operating in 2021. The new tools for computer simulations – 3D technology combined with various numerical simulation software – provide an immersive experience and contribute to risk prevention inherent to the steelmaking process, both in product applications and in the different stages of steel manufacturing. These tests, which were previously performed on real parts, can now be computationally simulated, and presented in virtual reality, enabling the evaluation of various applications, and bringing agility in identifying inconsistencies. These new technologies make it possible to reduce or even eliminate losses in production processes at CSN and its customers, in addition to generating financial gains more efficiently.

In 2022, the installation and commissioning of a Vacuum Induction Melting Furnace (VIM – Vacuum Induction Melting) was completed, which enables the Research Center to produce, on a pilot scale, steels with the most varied chemical compositions. This asset increases CSN's competitiveness, as it reduces lead-time and product development costs, since new experimental alloys no longer require casting in the melt shop. In the first quarter of 2023, the installation of the most advanced Gleeble® thermomechanical simulator in Latin America will be completed. The equipment makes it possible to reproduce, on a laboratory scale, a wide range of steelmaking processes, such as casting, hot rolling, and annealing, among others. The investments presented, when used synergistically and with the help of other resources, make it possible for the entire steelmaking production flow to be carried out, on a reduced scale, within the Research Center.

With a team of highly qualified technicians and engineers and a wide availability of advanced resources for simulations and analysis, CSN's Research, Development and Innovation Center ranks among the steel companies most prepared to meet the growing demands of the market worldwide.

7- PEOPLE

CSN's “People & Management” model is based on five pillars: Attract; Align and Engage; To assess; To develop; Recognize and Reward. The company believes that its competitive differential is its human capital. Through this model, knowledge is transformed into a path of success, based on passion, dedication and competence that generate opportunities, achievements, and recognition.

(In thousands of reais - R$, unless otherwise stated)

In 2022, the CSN Group continued to invest in a more diverse and inclusive environment so that each employee could feel more included and recognized for their individualities. This is because CSN respects, promotes and values Diversity and Inclusion practices as an essential pillar linked to the strategic objectives of the business.

We see the importance of understanding and encouraging the similarities and differences of the group's professionals, encouraging all ways of thinking of our employees and the public with whom we work. To this end, we invest in a culture that promotes equal opportunities in all businesses. We believe that this inclusive journey is essential to accompany society in its evolution and still drive development for all people, institutions and, consequently, our businesses and results.

The governance of the Diversity and Inclusion management is carried out by the Human Resources Department and CSN Inova, more precisely by Inova Bridge, responsible for the integrated management of the ESG. Our operating strategy was based on two main fronts, namely: Culture of Diversity and Inclusion and Representativeness. On the Culture front, a communication, awareness-raising and internal training plan was developed to promote the appreciation of Diversity and Inclusion in all its pillars. Related to the Representativeness front, our great public commitment, made by the UN Global Compact, is to reach 2025 with 28% of women. Internally, we also defined the goal of investing in hiring People with Disabilities.

In 2022, we continued to drive Diversity and Inclusion results through the following initiatives: Program to train women; PCD empower program; Master Class on Gender Equity; Racial Literacy and Citizenship Mentoring Program with the participation of young people from the Garoto Cidadão Program.

The year 2022 also represented an important renewal in the institutional proposal for training and development of its employees for the Group: the CSN Corporate University. Launched in August and made available to employees in October, during the last 3 months of the year, the University was responsible for more than 79,000 hours of training. In addition to promoting face-to-face training, including mandatory and safety training, the online platform already provides more than 40 virtual contents on demand so that employees can build their own learning journeys. As follow-up and strategic planning of the teams, the Corporate University brings tools so that managers can promote the direction of their subordinates.

The structure of the Corporate University is divided into 5 schools: School of Excellence in Results, School of Leaders, School of Business, School of ESG and School of Innovation. These segments allow the direction of contents according to the of the Company´s organizational structure. From the launch, some training initiatives that occurred independently in the units were integrated into the University, such as the Usina do Conhecimento.

At the School of Excellence in Results, in addition to online training, the Corporate promoted two learning days, aimed at analysts and specialists, covering more than 370 employees. For analysts, the training focused on emotional intelligence and emotion management, facing the challenges of the contemporary world. The theme of the specialists' meeting was “Conversations about Career” and dealt especially with systemic vision, leader coaching and anti-fragile behavior. Within the scope of the Knowledge Plant, content was also offered via stream, such as training in Excel, webinars of technical content and lives. We also continued the Continuous Improvement Program. By identifying, exposing, and solving problems, CSN Mineração seeks to perpetuate the culture of excellence, with the support of structured methods to guarantee sustainable results, in addition to promoting and recognizing innovative initiatives. In 2022, 62.9% of the staff were involved in improvements, leading to the implementation of 4,646 improvements.

As for the Business School, it held 3 meetings in São Paulo for senior management across the entire group. The training included the participation of directors and executive officers of the Company, who contributed to the formation of the leadership skills necessary for the strategic challenges mapped out for the future of the company.

At the Schools of Leaders and Innovation, the year 2022 became a planning period: the contents, priorities and actions began to be mapped for the construction of personalized trails.

For Escola ESG, the highlight was the revitalization of Compliance training.

In 2022, we invested more than 441,900 hours in training, which demonstrates CSN's concern for the development of its employees.

Another project aimed at the development of the group was the Trainee Program 2022. Out of (20,008) applicants, 50 people from different parts of the country were selected, of which 24 are women and 26 are men. With the aim of training and integrating future CSN leaders, it started in March and lasts for 18 months being scheduled to end in September/2023. The structure was divided into 4 phases, namely: Onboarding, Business Knowledge, Hackathon and On The Job.

In partnership with CSN Inova, we carried out the first edition of CSN Conecta, a program that aims to identify solutions with the objective of accelerating ESG pilot actions in the CSN Group according to the themes Water and effluents; Energy Efficiency; Waste Management; Climate changes; Diversity and Inclusion; Biodiversity and Forests and Health and Safety.

(In thousands of reais - R$, unless otherwise stated)

The projects and groups were presented to investors – our angel directors – on 11/30 and 12/1 at Faria Lima in São Paulo, and the three best evaluated projects will receive an award.

Our Recruitment & Selection policy contains the following points:

To meet the organization's need for human resources, priority is given to the internal recruitment and admission of People with Disabilities, provided they meet the prerequisites for the position in question.

In 2022, CSN participated in two academic events related to Internship Fairs, focused on attracting and selecting young people to work for the company:

In both events, we presented CSN's history and business, the Company's areas of activity and the Internship Program. In addition, among the proposed activities, we held lectures on the theme of Sustainability and Innovation, conducted by the Innovation and ESG Coordinators. Together, the two internship fairs were attended by 6,504 visitors, including students, professors, and external visitors, which fostered a considerable increase in the company's visibility and in the number of applications for the Internship Program for the second half of 2022.

Another project that we had at the CSN Group, in partnership with CSN Inova, is the Pilot with Gupy, a recruitment and selection platform that uses Artificial Intelligence to optimize the stages of the selection process, allowing the Company to quickly find candidates who have greater affinity with our vacancies. The implementation of the pilot, to be implemented by the Director CIG (Integrated Management Center), brought improvements and time optimization in our selection processes.

We ran our People Cycle where all employees had the opportunity to receive and give feedback on their current situation and their career expectations. The People Cycle consists of the following stages: evaluation – people committee, where calibrations are carried out - feedback - career & succession - preparation of the PDI - Development. The role of the leader in this process is fundamental. Leaders are responsible for supporting the development of the team, in order to make them better professionals, thus ensuring people's growth and CSN's perpetuity, through the career & succession program. The Competency Assessment follows the methodology as below:

▪ Executive Directors; Advisors, Directors; General Managers and Managers undergo a 360° Assessment in which they perform a self-assessment and receive an assessment from their immediate manager, peers, team, and internal customers/suppliers.

▪ Trainees undergo a 270° Assessment in which they perform a self-assessment, receive an assessment from the manager, peers and internal customers and suppliers.

▪ Coordinators and Supervisors undergo a 180° Assessment in which they perform a self-assessment and receive an assessment from the immediate manager and team.

▪ Specialists; Higher level; Administrative and Operational Level undergo a 90° Assessment in which they carry out a self-assessment and receive an assessment from the immediate manager.

23,963 employees were eligible for the Skills Assessment process. After the evaluation, we carried out the CSN Group's 9Boxes and implemented calibration in the People Committee, resulting in the “inverted L”, mapping the Company's talents and potential. 28 Executive-level People Cycle Committees were held, talent discussions and potential successors for Managers and above, in a record time of 30 days.

(In thousands of reais - R$, unless otherwise stated)

We carried out a market mapping for executive positions that did not have potential successors, for which we developed a criticality matrix to analyze the positions. Aiming at the sustainability of the CSN Group's businesses, we carry out Assessments of all Steel and Mining Executives, where an PDI must be prepared to accelerate the career of those involved. Following the process, we updated our Skills Self-Development Guide to support the preparation of the PDI, which was also reformulated. And we have developed a new form to manage feedback. As a process improvement, we implemented a new performance management platform, where we will have everything integrated into a single system: result of goals; Skills; 9Box result, calibration committee, people cycle; feedback records and preparation of PDIs. This platform is based on social networks, to provide a better employee experience. It is more agile, transparent and friendly, and can be accessed through cell phones.

In 2022, 90.9% of employees in Brazil underwent a performance evaluation process:

In its employee recruitment and appreciation practices, the CSN group ensures non-discrimination, making it clear that the organization is intolerant of any practice contrary to its ethical values. The following points are included in its Recruitment & Selection policy:

▪ The organization maintains a professional and responsible relationship with its employees and does not allow career-related decisions to be based on personal relationships.

▪ The organization does not tolerate any attitude guided by prejudices related to origin, religion, race, gender, sexual orientation, social class, age, marital status, political party position and disability of any nature, for the purpose of sponsoring and donating to social projects, care and cultural. Likewise, for the hiring and use of its professionals, as long as they meet the technical requirements and the profile required for the position.

▪ The organization does not tolerate illegal practices such as child labor and, therefore, maintains a work environment that respects the dignity of all employees, which promotes good professional performance and is free from any type of discrimination and sexual or moral harassment. The organization will not employ child or slave labor, nor will it agree with such practices by third parties that supply us with products or provide any type of service.

▪ To meet the organization's need for human resources, priority is given to the internal recruitment and admission of People with Disabilities, provided they meet the prerequisites for the position in question.

The CSN Group ended 2022 with 24,924 direct employees, indicating a 1.5% turnover rate for direct employees.

8 – PERFORMANCE IN ESG ASPECTS (environmental, social and governance)

The year 2022 was marked by important initiatives towards the growth and expansion of the Company's businesses, which contributed significantly to an acceleration in the development of material topics in CSN's ESG management. In June 2022, the CSN Group published its Integrated Report for the year 2021, highlighting the update of the materiality matrix with a change in the order of priorities and the inclusion of three new themes: Diversity and Inclusion, People Management and Supplier Management. Furthermore, it was the first time that CSN reported the study and assessment of climate risks and opportunities following the TCFD framework in its entirety. The 2021 Integrated Report can be accessed on the website esg.csn.com.br.

(In thousands of reais - R$, unless otherwise stated)

The year also stands out for the consolidation of the ESG Committee and the improvement of CSN in several internationally recognized indices:

CSN has outlined goals connected with the ESG agenda that guide the Company towards more efficient, integrated, and sustainable management. Below are the performances in the main goals according to their relevance and materiality for the Company and its stakeholders.

Performance of Key ESG Goals

	Indicators¹	Unit	Indicator Base-Year	2022	Status	Goal	Year
Environmental	Steel Emission Intensity ²	tCO2e / t crude steel	2.10 (Base-year 2018)	1.99		1.68	2035
	Cement Emission Intensity ³	kgCO2e / t cement	519 (Base-year 2020)	481		374	2030
	Mining Emission Intensity (GHG) 4 e 5	kgCO2e /t iron ore	5.77 (Base-year 2019)	7.24		4.04	2035
Social	Frequency Rate 6	CAF+SAF	2.46 (Base-year 2020)	1.79		1.72	2030
Governance	Diversity (women on staff)	%	14% (Base-year 2020)	20.5		28%	2025

¹ The units acquired in 2022 by CSN Cimentos and CSN Energia were not incorporated for this reporting.

² Considers emissions according to WSA methodology and production of UPV and SWT units.

³ In 2022, the CSN Cimentos Alhandra unit began to be considered in the management of CSN Cimentos data.

⁴ Considers the emissions of scopes 1 and 2 divided per ton of iron ore produced at CSN Mineração, according to the methodology of the Brazilian GHG Protocol Program.

⁵ It considers the emissions only of the mobile combustion category of CSN Mineração Scope 1 that represent 95% of CSN Mineração's scope 1 emissions, emphasizing that the scope 2 emission is zero due to the energy consumption coming 100% from renewable sources. The data reported in the company's 2021 Integrated Report considers the total emissions of the company CSN Mineração, scopes 1 and 2.

⁶ The rate considers accidents with and without absence of own employees and third parties / 1 million hours worked.

(In thousands of reais - R$, unless otherwise stated)

A – Environmental Dimension

Environmental management

CSN maintains several Social-Environmental and Sustainability Management instruments in order to act in a proactive manner, serving the various stakeholders involved in the communities and businesses in which it operates. The company works constantly to transform natural resources into prosperity and sustainable development. Throughout 2022, BRL 492.2 million were allocated to environmental initiatives, between funding and investment, in sustainability initiatives, mitigation and compensation for possible impacts of its activities.

The Company has an Environmental Management System (EMS) that was developed based on the highest standards, especially the NBR ISO 14001:2015 standard. 95% of the Group's production units are certified under this standard, with two of them obtaining certification in 2022: CSN Cimentos Volta Redonda (RJ) and CSN Cimentos Alhandra (PB). The system ensures full compliance with environmental legislation, maximum efficiency in the use of natural resources, protection of biodiversity and awareness of direct and indirect workers.

CSN also has a Quality Management System certified by ISO 9001:2015 at the following Brazilian units: Arcos (MG), Sepetiba Container Terminal (RJ), Fundição ERSA (RO), Porto de Tecar (RJ), CSN Mineração (Casa de Pedra e Pires – MG), CSN Usina Presidente Vargas (RJ), CSN Porto Real (RJ), Prada Resende (RJ), Prada Camaçari (BA), Prada Uberlândia (MG), CSN Paraná (PR), Prada Santo Amaro (SP), Prada Valença (RJ) and Prada Mogi (SP). Overseas, at the Lusosider units in Portugal and SWT in Germany.

The Usina Presidente Vargas, Porto Real and Paraná units also have the IATF 16149:2016 certification, specific for serving the automotive industry. Prada Uberlândia and Resende are also ISO 22001:2018 certified for food safety at the units. And SWT is also certified by ISO 50001:2018 Energy and BES 6001 Product Sustainability and Green Seal for Green Steel.

With the acquisition of LafargeHolcim's Brazilian operations, eleven more units became part of this indicator in the Integrated Management System model (ISO 14001:2015 and ISO 9001:2015), in addition to API certification at the Cantagalo (RJ) unit, ISO 17025:2017 certification in Geocycle and Ecological Seal in cement grinding in Vitória (ES).

Waste and Circular Economy

The CSN Group applies the concept of circular economy in all sectors and businesses in which it operates. Focused on generating value from the maximum use of natural resources, the company evaluates solutions and implements technologies for the reuse of materials in its own production processes and other production chains.

Within the Company, the Special Sales area has been increasingly seeking opportunities to sell unserviceable and unused materials, aiming not only for zero landfill, but also for internal use. All units have a warehouse for receiving and proper segregation of materials for sale. In 2022, Circula+ (a digital platform for special sales) became the first spin-off of CSN Inova and ended the year with five active customers, in addition to CSN itself, and achieved a turnover of BRL 337 million, with a 15% growth compared to 2021, when the platform was not yet being used.

The year was also marked by the start of waste co-processing operations at CSN Cimentos in the Arcos unit. With the recent acquisition of the LafargeHolcin group´s Brazilian operations, CSN now also has the services of Geocycle, a company responsible for managing industrial and urban waste that can be used as alternative fuel in cement kilns. In this way, it enhances the co-processing initiatives already underway at CSN and strengthens its actions in line with the principles of circular economy.

The total volume of waste generated by CSN's businesses was 3% higher compared to 2021 - excluding mining rejects, this result is due to the demolition and renovation of Battery #3 of the Coqueria at UPV. Most of the waste generated (99%) is classified as non-hazardous. Of these, 93% were reused, reprocessed, or sold as inputs for other production chains, and only 7% were disposed of in properly licensed industrial landfills, incinerated, or treated for effluent.

Water Resources

Water is one of the main inputs for our production processes, especially in the steel and mining sectors. We ended 2022 with an 8.2% reduction in the volume of water captured compared to 2021, going from 81,000 m³ to 74,000 m³ in 2022. Compared to 2019, the reduction is even more significant, with a 14% reduction and 94.4% water recirculation in the production process at the Usina Presidente Vargas operations.

In 2022, a water footprint study was conducted at the Cimentos unit in Arcos/MG, which showed an increase in the recirculation index from 80% to 93%. In addition, with the inclusion of the Alhandra/PB plant in the annual results of the segment, the specific water intake per ton of cement produced achieved a reduction of 25% compared to 2022, dropping from 98.8 to 74.4 liters/ton of cement in 2022.

(In thousands of reais - R$, unless otherwise stated)

CSN Mineração has committed to reducing the consumption of new water per unit of iron ore production by at least 10% by 2030 (2018 baseline). By 2021, a reduction of 11% had already been achieved. However, 2022 was marked by heavy rainfall in the first quarter that substantially affected the production of iron ore at the Casa de Pedra unit, located in Congonhas/MG. The decrease in production impacted the indicator, resulting in an 8% increase in this volume compared to the baseline year (2018). The expectation for 2023 is that the indicator will return to the levels of 2021.

Regarding water recirculation in the beneficiation production process at the Central Plant, due to investments in operational improvements, the recirculation rate increased from 79% in 2018 to 88% in 2022. With the start of operations at P15 and the implementation of dam decharacterization projects, it is expected that the mine will operate more efficiently and achieve recirculation levels of up to 95% by 2025.

Biodiversity and Natural Resources

In 2022, were established governance and management practices that resulted in significant progress regarding biodiversity and natural resources. At the beginning of the year, the Biodiversity and Forest Working Group was established, which supports the ESG Integrated Management Commission and the ESG Committee. Among the group's works throughout the year, the following stand out: geoprocessing of properties, forest diagnosis, benchmarking, and a preliminary assessment of the impact and dependence of our operations on ecosystem services and natural resources. In total, CSN protects an area of approximately 81,000 hectares distributed throughout the various Brazilian biomes.

Biodiversity management at CSN is aligned with the guidelines of the Task Force on Nature-related Financial Disclosure (TNFD). In addition, a biodiversity roadmap has been established, which includes work fronts over the next three years, engaging the Working Group and other areas of the company in the development of practical projects that address requirements not only of TNFD but also of the Performance Standard 6 (Conservation of Biodiversity and Sustainable Management of Living Natural Resources) of the International Financial Council (IFC).

Thus, the identification of key risks and opportunities and their respective management become the main objective in our Biodiversity and Natural Resources strategy, aiming to support and complement CSN's risk management, which, up to this point, already includes a systematic assessment of climate risks and opportunities.

Climate Change

In 2022, CSN announced its ambition to provide essential materials to society with net-zero carbon emissions by 2050. CSN invests efforts and resources in reducing greenhouse gas emissions and mitigating the impacts related to climate change. The company was the first in the steel industry to publicly present targets for reducing its greenhouse gas emissions, and to achieve this journey towards carbon neutrality, restructured its climate strategy into three pillars: Stakeholders, Mitigation, and Adaptation. (Learn more at esg.csn.com.br/mudancas-climaticas)

In 2022, the marginal abatement cost curve (MAC) of the steel industry was updated with detailed project cost and emission reduction assumptions, which also incorporated the SWT emission reduction projects in the Blue phase (until 2030). The mining MAC curve was also constructed, considering the predefined emission reduction projects in the 30% reduction target in greenhouse gas emission intensity until 2035 and neutrality until 2044. In 2023, the CSN Cimentos Brasil MAC curve will be reviewed and updated with the entry of new LafargeHolcin Brazilian plants and the Alhandra Unit.

At the beginning of the year, the company completed a qualitative assessment of climate risks for all CSN segments, based on TCFD (Task Force for Climate-Related Financial Disclosure) guidelines and disclosed in the Integrated Report 2021. In 2022, CSN also completed a quantitative assessment and the first climate scenario study aimed at encouraging and equipping company managers to consider climate change factors in the company's strategic decision-making. To achieve this, three climate scenarios were developed based on the narratives of the Shared Socioeconomic Pathways (SSP) scenarios used in the latest IPCC report. The study will be available in greater detail in the Integrated Report 2022, scheduled for publication in April 2023.

The year 2022 was a time of great maturity in the governance of material issue, now the company's top leadership monitors the progress of decarbonization projects in the Steel, Cement and Mining segments monthly. We are reinforcing this strategy for the coming years with the acquisition of CEEE in 2022 and energy self-sufficiency, which will support the sustainability of the Company's decarbonization plans.

Since 2013, the company has conducted an inventory of greenhouse gas emissions, following the guidelines of the GHG Protocol. The company has received the Golden Seal for the eighth consecutive year for reporting the emissions in all units and submitting them to external verification. CSN also reports annually to the Disclosure Insight Action (CDP) on specific information related to climate change, supply chain, and water security. In 2022, we maintained a score of B in Climate Change and Water Security.

(In thousands of reais - R$, unless otherwise stated)

Dam Management

Dam management is one of the priority topics on the CSN ESG agenda, the controlling company of CSN Mineração, the first large-scale mining company to become 100% independent of dams usage with no history of accidents in its facilities. The operation consists of dry stacking of tailings, following best national and international practices for safety, risk mitigation, and social-environmental impact.

The Company's socio-environmental guidelines also include monitoring of the dams previously used to contain tailings from CSN Mineração's beneficiation process. According to the dam classification (Resolution 95/2022 of ANM), all dams are audited by specialized and independent companies, aiming to attest to the dams´ stability and identify preventive actions to ensure the structures´ stability. The Dam Safety Plan and the Emergency Action Plan for Mining Dams (PAEBM) of CSN Mineração are completed with all volumes consolidated in compliance with ANM's regulation.

We ended 2022 with all CSN Mineração dams - a company controlled by CSN - with a zero level of emergency, that is, with stability guaranteed according to national legislation. In continuation of the schedule for the de-characterization of our dams, the de-characterization of Auxiliar do Vigia and B5 Dams were completed, and the de-characterization process of the Vigia Dams is ongoing, which will be completed in the first half of 2023, and B4, which is expected to be completed by 2028, according to the following schedule:

The stabilization for the B2A Dam, belonging to Minérios Nacional - a company of the CSN Group, are also ongoing, and in 2022 it was classified as level 02 emergency. Due to the work process and the constant evolution in safety factors, it is expected that in the first quarter of 2023 the structure will be classified as level 1 and the process of decharacterization will continue, scheduled to be completed in 2026.

B - Social Dimension

Health and Safety at Work

Peoples´ health and safety is our top priority, in 2022, we achieved the lowest historical level of our frequency rate (CAF+SAF: accidents with or without absence of own and third-party employees). There were 1.79 accidents/million man-hours, a decrease of about 25% compared to 2021, the best frequency rate in the last 8 years, and the highest percentage of reduction since the beginning of data compilation for the units in 2014, setting a new milestone for the CSN group. In addition, the year was marked by the nonappearance of accidents with absence of own employees in the following units: Cimentos (VR), Alhandra (PB), Minérios Nacional (Fernandinho), Porto Real, and Prada Distribuição.

The safety of direct and indirect employees is a top priority for CSN. The successive improvement in frequency rate indicators reinforces the company's commitment in the pursuit of zero accidents. The Company's Health and Safety Guidelines are based on the best market practices, directed by regulatory standards with national and international recommendations. In addition, through guidelines established in policies and manuals of the CSN Group - controlling company of CSN Mineração - all direct and indirect employees are trained in actions and behaviors related to occupational safety, proactivity, legal compliance, mitigation, control of hazards and risks, prevention of occupational accidents and illnesses.

(In thousands of reais - R$, unless otherwise stated)

The Sustainability Policy and the Health and Safety Manuals of the CSN Group - applicable to all its businesses - can be accessed in the links below:

• Sustainability Policy (access here)

• Occupational Safety and Health Management Manual (access here)

• Occupational Health and Safety Manual for Suppliers (access here)

In 2022, CSN Cimentos in Arcos started the process of adapting to comply with ISO 45.001:2018. In Portugal, Lusosider and SWT, in Germany, have a Health and Occupational Safety Management System certified by the ISO 45.001:2018 standard.

In order to monitor and measure the effectiveness of compliance with safety guidelines, operations use performance indicators that include: frequency and severity rates of accidents with and without injuries, for both own employees and third parties; behavioral audits, record control and anomaly treatment, with daily reporting of these indicators to top management, as well as the Critical Risks Fatalities Prevention Program.

The Company's actions for health go beyond occupational health, seeking engagement and habit change with a focus on a healthy life for all employees, direct and indirect. Among the programs, there are awareness-raising actions focused on reducing and preventing non-communicable chronic diseases (such as diabetes, hypertension, and obesity), mental health care, healthy eating, physical activity, and prevention of alcohol, tobacco, and other substance use.

In 2022, in partnership with public health entities, we continued to strongly encourage vaccination against Covid-19 and other communicable diseases, including administering vaccines within our CSN Group units. In addition, internal vaccination campaigns against the flu (H1N1) were carried out with the participation of more than 17,000 employees.

Through programs aimed at improving Health and Safety performance, CSN directly contributes to creating and maintaining a safe and healthy work environment. These initiatives include:

Diversity and Inclusion

Diversity among people is a lever for innovation and business growth at CSN, which supports the transformation of our society. Initiatives and actions related to the evolution of talent recruitment, assessment, and recognition processes reflect in practice mechanisms that promote gender representation and equity, people with disabilities (PWDs), and minority groups in operational positions and leadership positions.

(In thousands of reais - R$, unless otherwise stated)

The CSN Group has a zero-tolerance policy towards any form of discrimination, as expressed in its Code of Ethics. In 2020, the goal was set to double the female workforce at CSN by 2025, from 14% to 28%. The representation of women in the CSN Group increased from 17.5% in December 2021 to 20.5% in December 2022, a growth of 17% in the period.

In pursuit of our commitment, in 2022, the company continued a series of meetings and discussions with administrative and operational leaders to promote awareness and knowledge about the importance of an inclusive and diverse work environment. In this regard, the live video conference on racial literacy, taught at the ESG School of the Corporate University, stands out, which added to almost 4,000 diversity and inclusion trainings on the platform this same year, engaging leaders and employees.

Regarding the result of Representation of People with Disabilities, in 2022 we had a growth of 20%, compared to 2021, counting on practices that aim at the inclusion of these citizens, such as the program Capacitar Pessoa com Deficiência, launched this same year. In addition, goals were cascaded to all the group's businesses, directing all towards a path of greater inclusion and diversity.

Social Capital and Relationships

In 2021, CSN committed to conducting a human rights due diligence in the municipality where its Casa de Pedra mine is located, Congonhas, MG. In 2022, CSN Group and its Foundation, together with the Center for Human Rights and Business at Fundação Getúlio Vargas, began the internal assessment of processes, systems, and people regarding the identification and management of adverse human rights risks in nearby communities. The work has been developed based on the UN Guiding Principles for Business & Human Rights framework, used as the primary tool to identify risks and impacts on human rights associated with business activities, including its value chain. The project is scheduled to conclude in the first half of 2023.

In 2022, the company developed its "Theory of Change," an important tool for strategic direction aimed at development and investment in the territories in which the company is related. The process was conducted by the CSN Inova ESG cell together with the CSN Foundation.

Its participatory construction involved more than twenty actors called upon for listening rounds and dialogue interviews, in which the main facilitators and inhibitors of territorial development in Brazil and Latin America could be understood. Through this process, CSN Group designed an impact theory in development that contains its main objectives, territories, SDGs, assumptions, monitoring indicators, and logic framework for implementation, maintaining its commitment to a sustainable long-term future, promoting the dynamization of the local economy and income generation for vulnerable communities in these territories.

The Theory of Change can be accessed here. The first economic and socio-environmental development project resulting from this work is already being developed in Piauí, where CSN operates one of its logistics assets, the TLSA railway.

Social Responsibility

CSN promotes a positive and partnership-based relationship with the local communities where it operates. The main vehicle for building these relationships is the CSN Foundation, which has been operating for over 60 years in the territories and plays a fundamental role in promoting transformation through social, educational, and cultural development. The Foundation has education, culture, articulation, and curation as its main areas of focus. To learn more about the actions and programs of the CSN Foundation, visit https://fundacaocsn.org.br/.

In 2022, the expansion of the CSN Group provided new challenges and opportunities for the CSN Foundation. With the integration of the Companhia Estadual de Geração de Energia Elétrica (CEEE) and the Brazilian assets of LafargeHolcim, the Foundation became part of the initiatives carried out by the Força e Luz Foundation, managed by CEEE, and by the LafargeHolcim Institute.

The CSN Foundation believes in the transformation of society through education and cultural expression. Among its programs, the Garoto Cidadão program stands out, which is a sociocultural project that serves 2,533 children and adolescents in the main cities where the company is located. In 2022, two new spaces were inaugurated, one in the urban area of Coxim/MS and the other in Heliópolis/SP.

With its operating model, the CSN Foundation connects investments to the Sustainable Development Goals (SDGs) agenda and the principles of the UN Global Compact, and contributes directly to the transformation of lives, families, and communities, reinforcing its commitment to the cities where it operates.

Highlights of CSN Foundation in 2022:

• The CSN Group invested over BRL 26 million in social responsibility, supporting 74 projects across 18 Brazilian cities.

• The Foundation directly carried out actions in 32 cities.

• 425 cultural actions were performed, reaching 246,916 views.

• 644 students were awarded scholarships for formal education.

(In thousands of reais - R$, unless otherwise stated)

• 4,643 young people benefited from their projects.

C - Governance Dimension

The ESG Committee, a non-statutory advisory body to the Board of Directors of CSN Group, is composed of senior executive leadership and is responsible for defining the Company's ESG strategies, together with the Sustainability Directorate, which reports directly to the CEO of CSN. The Committee is directly involved in managing ESG indicators, evaluating and identifying ESG risks and opportunities, and developing projects to leverage the innovation agenda.

The Board of Directors is responsible for establishing strategic guidelines and deliberating on economic, social and environmental issues that impact the Company's business. To support the Board of Directors' decisions, the ESG Committee is responsible for presenting progress, challenges, risks and opportunities related to the eight Thematic Groups presented in the image below to this body. These Groups were created in accordance with the Company's Materiality Matrix, last reviewed in 2022.

The structure also includes the Integrated ESG Management Commission, composed of ESG ambassadors appointed by the members of the Committee, whose main function is to implement an open innovation and sustainability system distributed across the Thematic Groups. The main function of the Integrated Management Commission is to standardize concepts and disseminate best practices in all business segments, with a focus on achieving established goals. In parallel, ESG Ambassadors participate in training and workshops related to the ESG Innovation theme and coordinate strategic projects. In 2022, in the first year of operation, six meetings of the ESG Committee were held, 1,400 hours of training and workshops were conducted with the 25 ESG Ambassadors and 67 initiatives mapped.

In 2021, with the support of the ESG Committee, the CSN Conecta program was launched with the aim of identifying ESG actions initiatives that could transform the day-to-day operations of the CSN Group and the entire industry and be accelerated. The topics addressed included water, energy, emissions, and waste. Among the 130 projects received, 12 were approved and implemented. The top three received a financial prize and were announced during ESG Week 2022, along with the start of the new project cycle for 2023, which will cover the following topics: water and effluent, energy efficiency, waste management, climate change, diversity and inclusion, biodiversity, forests, health, and safety at work.

9 - STATEMENTS ON PROJECTIONS AND FUTURE PROSPECTS

This document contains forward-looking statements that express or suggest expectations of results, performance or events. Actual results, performance and events may differ significantly from those expressed or suggested by the forward-looking statements due to various factors, such as: general economic conditions in Brazil and other countries, interest rates and exchange rates, future renegotiations and early payment of obligations or credits in foreign currency, protectionist measures in Brazil, the US and other countries, changes in laws and regulations, and competitive factors in general, at the regional, national or global level.

The financial information of CSN presented here is in accordance with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) and accounting practices adopted in Brazil. Non-financial information, as well as other operational information, has not been audited by independent auditors.

(In thousands of reais - R$, unless otherwise stated)

4Q22 AND 2022 FINANCIAL RESULTS

March 08, 2023

(In thousands of reais - R$, unless otherwise stated)

São Paulo, March 8, 2023 - Companhia Siderúrgica Nacional ("CSN") (B3: CSNA3) (NYSE: SID) discloses its fourth quarter of 2022 (4Q22) and 2022 yearly financial results in Brazilian Reais, with all financial statements consolidated in accordance with accounting practices adopted in Brazil issued by the Accounting Pronouncements Committee ("CPC"), approved by the Brazilian Securities and Exchange Commission ("CVM") and the Federal Accounting Council ("CFC") and in accordance with international financial reporting standards (“IFRS”), issued by the International Accounting Standards Board (“IASB”).

The comments address the Company's consolidated results in the fourth quarter of 2022 (4Q22) and the compared are for the third quarter of 2022 (3Q22), the fourth quarter of 2021 (4Q21) and the year 2021. The price of the dollar was BRL 5.58 at 12/31/2021; BRL 5.41 on September 30, 2022, and BRL 5.22 on 12/31/2022.

4Q22 Operational and Financial Highlights

	15% GROWTH IN ADJUSTED EBITDA FOR THE QUARTER, SUPPORTED BY THE MINING SEGMENT AND THE INTEGRATION OF THE LATEST ACQUISITIONS			STRONG COMMERCIAL DYNAMISM ON MINING GENERATED THE BEST QUARTER OF THE YEAR IN TERMS OF SALES, WITH IMPROVEMENT IN REALIZED PRICES
	Despite a quarter marked by seasonality and greater economic uncertainties, CSN was able to show growth in operating results, with the mining segment offsetting the weaker performances recorded in the steel industry. As a result, 4Q22 Adjusted EBITDA reached BRL 3.1 billion and with an EBITDA margin of 27%. In the year, Adjusted EBITDA was BRL 13.8 billion, with a margin of 30%.			The quarter was marked by strong sales volume and favorable price dynamics. As a result, mining segment accrued an Adjusted EBITDA of BRL 1,779 million and with a profitability that exceeded the 50% mark. For 2023, the perspective is for production growth, with a greater iron ore quality and prices that are surprising positively.
	STEEL INDUSTRY MARKED BY SEASONALITY ON 4Q22, BUT THE YEAR'S PERFORMANCE SHOWS A MUCH MORE RESILIENT COMPANY			CEEE-G INCORPORATION IN THE ENERGY SEGMENT
	Even with a lower production cost, the steel industry's result was impacted by a weaker trading pace at the end of the year and lower price dynamics. On the other hand, CSN's performance throughout 2022 reinforces the Company's resilience by delivering an over 20% margin, even considering the pressures in raw material costs and a decrease in international market prices.			The incorporation of CEEE-G opens up a new avenue of opportunities for CSN's energy segment and the benefits of self-production and the sales of energy surplus will be even more relevant throughout 2023. On the other hand, the closing of the acquisition and the disbursement with the concession concentrated in 4Q22, ended up temporarily pressuring CSN leverage.
	CIMENTOS BRASIL (EX-LAFARGEHOLCIM BRASIL) CONSOLIDATON GENERATES A RECORD RESULT IN THE CEMENT SEGMENT			ESG
	Net revenue reached an all-time high of BRL 1.2 billion in 4Q22, driven by the consolidation of the latest acquisitions and a further pulverized sales channel. On the other hand, the period profitability was impacted by higher production costs and pressures on raw material costs. The expectation for 2023 is to accelerate the capture of synergies and take advantage of the favorable dynamics of the sector.			CSN received a new rating from Sustainalytics, reducing from 39.1 to 26.0 the ESG risk score. Of the 155 steel and mining companies evaluated globally, CSN achieved the 4th best score in the industry. CSN was also the only Brazilian company in the steel, mining and construction sectors named in the S&P Global Sustainability Yearbook 2023, ranked as the company in the steel industry that has made the most progress in ESG practices in the world, receiving the stamp of "Industry Mover".

(In thousands of reais - R$, unless otherwise stated)

Consolidated Table - Highlights

¹ Adjusted EBITDA is calculated from net income (loss), plus depreciation and amortization, taxes on income, net financial result, income from investment participation, income from other operating income/expenses and includes a proportional participation of 37.27% of the EBITDA of the joint subsidiary MRS Logística.

² Adjusted Ebitda Margin is calculated from Adjusted Ebitda divided by Management Net Revenue.

³ Adjusted Net Debt and Adjusted Cash/Availability consider 37.27% of MRS, in addition to not considering Forfaiting and Cashed Risk transactions.

Consolidated Results

(In thousands of reais - R$, unless otherwise stated)

Adjusted EBITDA

*The Company discloses its adjusted EBITDA excluding participation in investments and other operating income (expenses) because it understands that it should not be considered in the calculation of recurring operating cash generation.

(In thousands of reais - R$, unless otherwise stated)

Adjusted EBITDA (BRL MM) and Adjusted EBITDA Margin¹ (%)

¹ Adjusted EBITDA Margin is calculated from the division between Adjusted EBITDA and Adjusted Net Revenue, which considers the 100% stakes in CSN Mineração's consolidation and 37.27% in MRS.

Adjusted Cash Flow¹

Adjusted Cash Flow in 4Q22 was negative in BRL 146 million, affected mainly by the higher volumes of Capex and financial expenses, in addition to the increase in taxes paid in the period.

Adjusted Cash Flow¹ on 4Q22 (BRL MM)

¹ The concept of adjusted cash flow is calculated from adjusted Ebitda, subtracting Ebitda from Jointly Controlled Companies, CAPEX, IT, Financial Results and Changes in Assets and Liabilities², excluding the effect of the Glencore advance.

² Adjusted Working Capital is composed by the change in Net Working Capital, plus the change in accounts of long-term assets and liabilities and disregarding the net change in IT and SC

Indebtedness

As of December 31, 2022, consolidated net debt reached BRL 30,471 million, with the leverage indicator measured by the Net Debt/EBITDA ratio reaching 2.2x. This increase on leverage is a consequence of a series of disbursements made through the period, mainly those related to the acquisition of CEEE-G like the disbursement of BRL 2.0 billion regarding the concession payment, in addition to distribution of dividends. However, when considering the resources with prepayment of iron ore obtained in January in the debt at the end of the year, the leverage would be 2.0x and within the guidance disclosed by CSN, which reinforces the transitory and exceptional effect of this leverage above the ceiling. Additionally, even with the largest volume of financial disbursements, CSN maintained its policy of carrying a high cash, which in this quarter reached the level of BRL 12 billion.

(In thousands of reais - R$, unless otherwise stated)

	Leverage, Liquidity And Net Debt (BRL Billions; Net Debt / Ebitda (X))		Net Debt Build-Up (BRL Billion)

¹ Net Debt / EBITDA: To calculate the debt considers the final dollar of each period and for net debt and EBITDA the average dollar of the period.

The Company remains active in its goal of extending the amortization period, focusing on long-term operations and the local capital market. Among the main movements of 4Q22, the 12th and 13th debentures were issued, in the amount of BRL 1.9 billion, with maturities in 2027, in addition, the conclusion of the 1^st issue of debentures from the Company’s subsidiary Prada in the amount of BRL 130 million maturing in 2024 and the 1^st debenture issue of the State Electric Power Generation Company - CEEE-G, in the amount of BRL 1.9 billion. also maturing in 2024.

Amortization Schedule (BRL Bi)

¹ IFRS: does not consider participation in MRS (37.27%) .

² Gross Debt/Management Net considers participation in MRS (37.27%) and gross interest.

³ Medium term after completion of the Liability Management Plan.

Foreign Exchange Exposure

The accumulated net foreign exchange exposure in the 2022 balance was USD 779 million, as shown in the table below, resulted from the increase in the Hedge Accounting operations and in line with the company's policy of minimizing the impacts of exchange rate volatility on the result.

The Hedge Accounting adopted by CSN correlates the projected flow of dollar exports with future debt maturities in the same currency. Thus, the exchange variation of the dollar debt is temporarily recorded in the equity, being brought to the result when the dollar revenues from said exports occur.

(In thousands of reais - R$, unless otherwise stated)

Investments

A total of BRL 1,036 million were invested in 4Q22, a performance 23% higher than the amount invested on last quarter, as a consequence of the acquisition of large equipment’s for cement operations and the incorporation of current investments on the operations of Cimentos Brasil. In the year, BRL 3,413 million were invested, an increase of 16% compared to 2021, mainly impacted by the Cimentos Brail incorporation and the acceleration of Capex at the end of the year.

Net Working Capital

The Net Working Capital (NWC) applied to the business totaled BRL 2,480 million in 4Q22, an increase of 85% when compared to 3Q22 as a consequence of the punctual increase in inventories and accounts receivable, partially offset by the increase with suppliers. Compared to the same period last year, the Company's NWC was 66% higher, mainly impacted by the increase in receivables due to longer receipt times.

The calculation of the Net Working Capital applied to the business does not take Glencore's advance, as shown in the following table:

(In thousands of reais - R$, unless otherwise stated)

¹ Other CCL Assets: Considers advance employees and other accounts receivable.

² Other CCL Liabilities: Considers other accounts payable, dividends payable, installment taxes and other provisions.

³ Inventories: Does not consider the effect of the provision for inventory losses. For the calculation of the SME are not considered the balances of warehouse stocks.

Dividends

As disclosed on the Material Fact published on November 21, 2022, through the Asset Restructuring Agreement entered into between Rio Purus Participações S.A. and CFL Participações S.A. (“CFL”), the shareholders committed to vote in favor of the distribution of dividends of up to BRL 2.3 billion at the 2023 Annual General Meeting. Therefore, the proposal for the allocation of results for the year 2022 reflects this amount, already considering the R$ 700 million declared as interest on equity on December 23, 2022.

Closing of the CEEE-G

On October 21, 2022, the Company concluded the acquisition process of 66.23% of the shares issued by the State Companhia Estadual de Geração de Energia Elétrica – CEEE-G for the total price of BRL 928 million. The process also included the disbursement of more BRL 2.0 billion for the grant bonus. Additionally, on December 22, 2022, CSN acquired another 32.74% stake of CEEE-G, for the transfer of shares held by Centrais Elétricas Brasileiras S/A, in the amount of BRL 367 million. As a result, CSN now holds 99.0% of CEEE-G, adding 910Mw of Installed Capacity, with 15 own assets, 11 minority interests and 3 wind projects. 

Results by Business Segments

(In thousands of reais - R$, unless otherwise stated)

Net Revenue by Segment - 4Q22 (BRL million-before eliminations)

Adjusted EBITDA by Segment - 4Q22 (BRL million-before eliminations)

(In thousands of reais - R$, unless otherwise stated)

Steel Result

According to the World Steel Association (WSA), global crude steel production accrued 1,831.5 million tons (Mt) in 2022, representing a 4.3% decline compared to 2021, also reflecting the effects of the conflict between Russia and Ukraine and its developments in the European market. In 2022, the European Union reduced its production by 10.5% due to the closure of several steel plants as a consequence of the energy restriction verified after the conflict began. In the year, only the Middle East showed increased production due to the announcement of major real estate and infrastructure projects in the region. In turn, China produced 55.3% of the global volume (1,013 Mt), which corresponds to a retraction of 2.1 p.p. in relation to the same period and 2021, mainly resulting from the direct impact of production interruptions due to covid's zero policy and heat wave, which increased energy rationing in the country. However, the outlook for 2023 is positive as we see several stimuli being announced to resume China's economic growth, apart from the easing of policies against Covid. Brazil produced 36.1Mt in 2022, which corresponds to an annual decline of 5.8%, mainly impacted by the cost pressures faced throughout the year, in addition to a more difficult basis for comparison due to the strong volumes verified in the previous year.

Steel Production (thousand tons)

In the case of CSN, plate production in 4Q22 totaled 959,000 tons, a performance 6.5% lower than in the previous quarter. In turn, the production of flat laminates, our main operation market, reached 873 kton, which represents a 1.4% reduction compared to 3Q22, in line with the operational seasonality. In 2022, plate production reached 3,774,000 tons, down 7.3% from the previous year, due to scheduled stoppages and pressures on production costs and on the supply chain, due to the conflict between Russia and Ukraine.

(In thousands of reais - R$, unless otherwise stated)

Sales Volume (Kton) - Steel

Total sales reached 1,008 thousand tons in the fourth quarter of 2022, a volume 1.6% lower than in the same period of 2021. When analyzing the behavior in the different markets, it is perceived that the domestic market sales were the main responsible for the contraction, adding up to 740 thousand tons of sold steel products, which represents a reduction of 14% when compared to 3Q22, as a result of the seasonality that was even more pronounced at the end of this year due to the World Cup and uncertainties related to the political environment. In the foreign market, 4Q22 sales totaled 269 thousand tons and were 11% lower than those in 3Q22, considering a lower sales volume verified in the European market. In the quarter, 8,000 tons were exported directly and 261,000 tons were sold by subsidiaries abroad, of which 39,000 tons by LLC, 154,000 tons by SWT and 69,000 tons by Lusosider.

Regarding 2022, the total sold volume was 4,392 thousand tons, a 4.6% lower level than in 2021, with 3,077 thousand tons being sold from the domestic market and 1,315 thousand tons abroad. Of this total, the foreign market showed the greatest retraction (-7.8% p.a.) explained by the energy instability and lower growth rates in the European market.

In relation to the total sales volume in 4Q22, all segments showed a retraction compared to the previous quarter, with Industry (-25.7%) and Distribution (-9.4%) appearing among the main highlights. In the annual comparison, the year was positive, with an increase in sales volume in most sectors, with Distribution (+29.6%) and Construction (+20%) being the main beneficiaries and were partially offset by Home Appliances (-42.6%) and Packaging (-14.3%) segments.

(In thousands of reais - R$, unless otherwise stated)

	Cost of plate with deprec. (R$/t)		4Q22 Production Cost

(In thousands of reais - R$, unless otherwise stated)

Adjusted EBITDA and Steel Margin
(BRLMM and %)

Mining Result

2022 was marked by a series of challenges for the mining sector. The high volume of rainfall in Brazil, the war between Russia and Ukraine and the uncertainties related to the Chinese economy were elements that brought instability to the transoceanic iron ore market throughout the year. Additionally, regarding China, the restrictive policies put in place last year by the Government as ways to curb Covid's waves in the country, the housing market crisis and energy rationing generated by the heat wave, in the third quarter, impacted industrial production and had a direct impact on the price of iron ore. On the other hand, since the end of last year, several policies of economic stimulus and easing in health rules have been observed, especially after the re-election of Xi Jinping for his third term, which has improved not only the expectations of the iron ore market, but also the estimates of Chinese GDP growth for the year 2023. In the midst of this context and despite reaching values below USD 80.0/ton, the price of iron ore ended the quarter with a price above USD 115.0/ton, with an average of USD 99.00/dmt (Platts, Fe62%, N. China) in 4Q22, 4.17 % lower than 3Q22 (USD 103.31/dmt) and 9.68% below 4Q21 (USD 109.61/dmt).

In relation to sea freight, the Route BCI-C3 (Tubarão-Qingdao) presented an average of USD 20.58/wmt in 4Q22, which represents a significant reduction of 14.4% in relation to the shipping cost from the previous quarter, as a reflection of a bigger offer of ships in the transoceanic market, in addition to the lower pressure on fuel costs.

	Total Production - Mining (thousand tones)		Sales Volume - Mining (thousand tons)

(In thousands of reais - R$, unless otherwise stated)

Cement Result

Despite the challenges that the rise in interest rates has brought to the real estate segment, the cement market has shown some resilience, with infrastructure projects and structured construction helping to compensate for the smaller launch of new housing units and fall of informal construction. And according to the National Union of the Cement Industry (SNIC), cement sales reached 63,052 Mton in 2022, down less than 3% compared to the previous year. For 2023, the expectation of the syndicate is that the segment will grow by 1%, driven by the increase in infrastructure projects, such as road and sanitary. In addition, the new government has shown interest in strengthening housing programs for low incomes, which can result in even greater dynamism for the sector. On the other hand, the Industrial Entrepreneur Confidence Index (ICEI), measured by the Brazilian Chamber of the Construction Industry (CBIC), presented a deceleration in the values and presented an average of 50.8, still a positive level, but that shows greater uncertainty of the entrepreneurs in relation to the future perspectives.

In the case of CSN Cimentos, the Company consolidated the operating and financial results of Cimentos Brasil (formerly Lafarge Holcim Brasil) and intends to advance in the process of capturing synergies. Sales in the 4Q22 totaled 2,897 kton, a result 53.3% higher than the previous quarter, as a result of the increase in the participation of Cimentos Brasil's operations. In 2022, the volume sold was 7,243 kton, an increase of 53.8% compared to the previous year, also reflecting the integration of Cimentos Brasil, even considering only 4 months of operation in the year's results.

(In thousands of reais - R$, unless otherwise stated)

* LafargeHolcim's operations were integrated in September 2022.

Energy Result

The year of 2022 was a historic year for the Energy operations segment of the Company, with acquisitions of four operations that increased installed capacity by 1,066.3 MW, in addition to adding another 356MW in minority interests. With this, the Company, in addition to becoming self-sufficient, began to have an energy surplus that will later be sold in the free market, making the segment a true business unit for CSN. Additionally, the benefit of self-production will allow a reduction of approximately 60% in energy costs, bringing significant impacts on the profitability of the segments.

In 4Q22, the traded energy volume generated a net revenue of BRL 154 million, an increase of 221% over the last quarter, recovering operating results with a positive adjusted EBITDA of BRL 27 million and EBITDA margin of 17.8%. In 2022, energy operations achieved revenues of BRL 293 million, with an EBTDA of BRL 3 million and EBITDA margin of 1.1%, representing only one quarter of incorporation of CEEE-G.

Logistics Result

Railway Logistics: In 4Q22, net revenue reached BRL 608 million, with adjusted EBITDA of BRL 270 million and adjusted EBITDA margin of 44.5%. Compared to 3Q22, net revenue decreased 7% due to the seasonality of the operation, with a reduction in transported goods. In the same comparison line, adjusted EBITDA was 17.3% lower. In the year, net revenue reached BRL 2,312 million in 2022, an annual increase of 25.7%, while Adjusted EBITDA grew 25%, reaching BRL 1,104 million and with an EBITDA margin of 47.8%.

Port Logistics: In the 4Q22, 335,000 tons of steel products were shipped by Sepetiba Tecon, in addition to 15,000 containers, 3,000 tons of general cargo and 281,000 tons of bulk. Compared to the previous quarter, the Company had a change in its shipment mix, returning the relevance of the volume of grains, with a quarterly increase of 4.9%, against an 89% reduction in overall cargo volume. As a result, the net revenue of the port segment was 25.8% higher than in the last quarter, reaching BRL 86 million in 4Q22 and positively impacting the adjusted EBITDA of the period, which achieved BRL 30 million in the quarter, with an EBITDA margin of 34.8%. In 2022, the segment recorded net revenue of BRL 308 million and EBITDA of BRL 90 million, with a margin of 29.3%, levels practically stable compared to 2021. Were shipped in 2022 by Tecon, 1,322,000 tons of steel products, in addition to 62,000 containers, 42,000 tons of general cargo and 918,000 tons of bulk.

(In thousands of reais - R$, unless otherwise stated)

ESG - Environmental, Social & Governance

ESG COMMITMENTS - CSN GROUP

(In thousands of reais - R$, unless otherwise stated)

ESG PERFORMANCE - CSN GROUP

The Company continues following the model of reporting its ESG results aligned with relevance and materiality for all stakeholders, in order to offer greater transparency and access to the main results and indicators, enabling its monitoring in an agile and effective way.

Quantitative indicators are presented in comparison with the previous annual period, for better monitoring. Some metrics are compared with the same period of the previous year, and others with the average of the previous period, ensuring a comparison based on seasonality and periodicity.

More detailed historical data on CSN's performance and initiatives can be verified in Integrated Report 2021. The Integrated Report follows internationally recognized guidelines and frameworks, such as GRI (Global Reporting Initiative), IIRC (International Integrate Reporting Council), SASB (Sustainability Accounting Standards Board) and TCFD (Task Force on Climate Related Financial Disclosures) and are presented with due correlation with the SDGs (Sustainable Development Goals) and principles of the UN Global Compact. The assurance of ESG indicators and targets occurs annually for the closing of the Integrated Report, so the information contained in the quarterly releases is subject to adjustments resulting from this process. The next Integrated Report, for the period 2022, is expected to be published in April 2023, in which details regarding the status and performance of all goals and indicators will be presented.

It is also possible to monitor CSN's ESG performance in an agile and transparent manner, on our website, through the following e-mail address: ESG.csn.com.br

ESG RATING

External recognitions in indexes and ratings shows that the Company is evolving in transparency and reporting of the main ESG actions and indicators, and in line with sustainable development.

The year 2022 provided an evolution in three important ESG ratings. CSN received a new rating from Sustainalytics, reducing the score related to ESG risks from 39.1 to 26.0. Of the 155 steel and mining companies evaluated globally, CSN achieved the 4th best score in the industry.

CSN was also the only Brazilian company in the steel, mining and construction sector named in the S&P Global Sustainability Yearbook 2023, being classified as the company in the steel industry that has advanced the most in ESG practices in the world, receiving the stamp of "Industry Mover". And also, in the rating of the MSCI, CSN went from the score "CCC" to "B".

Additionally, in response to external requests from investors and other stakeholders, the Company reports to CDP (Disclosure Insight Action) the guidelines followed in relation to Climate Changes and Water Safety. In 2022, CSN Mineração's score, company controlled by CSN, evolved on Climate Changes from "B -" to "B" and from "C" to "B" in Water Safety. The CSN Group, despite the even more restrictive changes in methodology, maintained the scores achieved in 2021, respectively B for Climate Change and B- for Water Safety. 

(In thousands of reais - R$, unless otherwise stated)

PERFORMANCE OF THE MAIN ESG TARGETS

	Indicators¹	Unit	Indicator Base Year	2022	Status	Goal	Year
Environmental	Steel Emission Intensity (WSA)2	tCO2and/t raw steel	2.10 (Base year 2018)	1.99		1.68	2035
	Intensity of Cements Emission (CSI)3	kgCO2and/t cement	519 (Base year2020)	481		374	2030
	Mining Emission Intensity (GHG)4 and 5	kgCO2and ore /t	5.77 (Base year 2019)	7.24		4.04	2035
Social	Frequency Rate6	CAF+SAF	2.46 (Base year 2020)	1.79		1.72	2030
Governance	Diversity (in the functional women framework)	%	14% (Base year2020)	20.5		28%	2025

¹ The units acquired in 2022 by CSN Cimentos and CSN Energia were not incorporated for this report.

² Considers emissions according to WSA methodology and production of UPV and SWT units.

³ In 2022, the CSN Cimentos Alhandra unit began to be considered in the data management of CSN Cimentos.

⁴ Considers the emissions of scopes 1 and 2 divided per ton of iron ore produced at CSN Mineração, according to the methodology of the Brazilian GHG Protocol Program.

⁵ Considers the emissions only of the mobile combustion category of Scope 1 of CSN Mineração that represent 95% of the scope 1 emissions of CSN Mineração, emphasizing that the emission of scope 2 is zero due to the electrical consumption coming from 100% of renewable sources. The data reported in the Company's Integrated Report 2021 considers the total emissions of csn mining, scopes 1 and 2.

⁶ The rate considers accidents with and without removal of own employees and third parties/1 million hours worked.

(In thousands of reais - R$, unless otherwise stated)

CLIMATE CHANGE

In the last quarter of 2022, during CSN Day, CSN announced its ambition to provide society with essential carbon neutral emission materials by 2050. In addition, the MAC curve (marginal abatement cost curve) of the Steel industry was updated, with assumptions of reduction of emissions and cost of detailed projects, in which were also incorporated the projects of emission reduction of SWT in the Blue phase, which extends until 2030. The Mining MAC curve was also reviewed, considering the projects to reduce pre-defined emissions in the construction of the goal of reducing GHG emissions by 2035 and neutrality by 2044. In 2023, the MAC curve of CSN Cimentos Brasil will be revised and updated with the entry of the new Brazilian plants acquired (Cimentos Brasil and Alhandra).

Also, in 4Q22, CSN finalized the quantitative assessment of climate risks for all business segments and its first study of climate scenarios. These two fronts allow Company’s managers to consider factors related to climate change in strategic decision-making. The study will be made available in greater detail in the Integrated Report 2022, scheduled for publication in April 2023.

In 2022, there was a reduction of 5% on intensity of the Steel industry in relation to the base year. The reduction is justified by the better performance of the Presidente Vargas Plant (RJ) and the use of renewable energy at SWT in Germany.

In cement operations, the Alhandra (PB) unit began to make up the annual report. This unit has an average emission intensity higher than other CSN plants (625 kgCO2e/t cement). However, even with the entry of Alhandra, there was a 7% reduction in GHG emissions compared to 2020. This is justified by the entry of the co-processing project in the Arcos unit, increasing the rate of alternative fuels, contributing to the decarbonization journey.

The year 2022 was also marked by heavy rains in the first quarter in the state of Minas Gerais that substantially damaged the operation and production at CSN Mineração. As a consequence of these factors, a specific mobile combustion emission (>95% of CSN Mineração's Scope 1 emissions) of 7.24 kgCO2e/ton of ore was recorded, 15% higher than 2021. New projects are expected to enter and decarbonization is expected to be more intense only in 2024.

ENVIRONMENTAL MANAGEMENT

NATURAL CAPITAL - ENVIRONMENTAL INDICATORS

¹ Considers all steel units and cement units in the CSN Group.

² Considers all csn group producing units in Brazil and abroad

(In thousands of reais - R$, unless otherwise stated)

² Considers all csn group producing units in Brazil and abroad

² Considers all csn group producing units in Brazil and abroad

³Considers waste intended for co-processing, recycling, refining and area recovery

DAM MANAGEMENT

In 2022, all dams of CSN Mineração – a company controlled by CSN – were at zero emergency level, that is, with stability guaranteed according to current national legislation. In continuity with the decharacterization schedule of the dams, the decharacterization of the Vigia and B5 Auxiliary Dams were completed, and the decharacterization process of Barragem do Vigia is ongoing, which will be completed in the first half of 2023, in addition to B4, with completion scheduled for 2028, as scheduled:

The stabilization works of the B2A Dam, belonging to Minérios Nacional, a company of the CSN Group, are also underway and which in 2022 was classified as emergency level 02. Due to advances in the works and the constant evolution in safety factors, the framework of the structure at level 1 and the continuity of the decharacterization process are expected to finish at the first quarter of 2023, the decharacterization is expected to be completed in 2026.

SOCIAL DIMENSION

HEALTH AND SAFETY AT WORK

The health and safety of people is the Company's top priority and, in 2022, the lowest historical level of the frequency rate (CAF+SAF: accidents with and without removal of own employees and third parties) was recorded. There were 1.79 accidents/million man-hours worked, a decrease of about 25% compared to 2021, which is the best indicator in the last 8 years, and the largest percentage of reduction since the beginning of the compilation of data from the units in 2014, establishing a new milestone for the CSN group. In addition, the year was marked by the absence of accidents with the removal of own employees in the following units: Cements (VR), Alhandra (PB), Ores Nacional (Fernandinho), Porto Real and Prada Distribuição.

(In thousands of reais - R$, unless otherwise stated)

¹ Considers all csn group units in Brazil.

PEOPLE MANAGEMENT

Diversity among people is a lever for CSN's innovation and business growth, which promotes a transformation of our society. Initiatives and actions related to the evolution of talent recruitment, evaluation and recognition processes reflect in practice mechanisms that promote gender representativeness and equality, people with disabilities (PCDs) and minority groups in operational positions and leadership positions. In 2020, the goal of doubling the female workforce at CSN was set by 2025, from 14% to 28%. As a result, the result of the representation of women in the CSN Group increased from 17.5% in December 2021 to 20.5% in December 2022, an increase of 17% in the period.

¹ Data consider employees allocated in Brazil, CLT, Apprentice, Internship and Program - Empower

² Data does not consider employees "Non-CLT" and "Internship Program".

VALUE CHAIN

In 2022, 538 suppliers were evaluated in social and environmental criteria considering the chain of all units in Brazil. Additionally, in 4Q22, CSN developed a specific ESG Risk Assessment questionnaire for 100 suppliers indicated as critical for the Company that addresses topics such as: health and safety management, community engagement, diversity and inclusion, whistleblowing channel, code of ethics, certifications, climate risk management, water scarcity and biodiversity.

The diagnosis will help CSN assess and manage potential socio-environmental and imaging risks, as well as influence its supply chain in the adoption of best market practices.

(In thousands of reais - R$, unless otherwise stated)

¹ Considers CSN Group in Brazil.

² Percentage over total suppliers in each category. Those suppliers who are in the same state (federative unit) of the evaluated operational unit are considered "local" as "local" as of the operational unit evaluated.

SOCIAL RESPONSIBILITY

In 2022, 4,643 young people were directly benefited and 246,916 people were impacted by the projects developed or supported by the CSN Foundation. BRL 26 million were invested in social responsibility, reaching more than BRL 200 million in the last three years for social projects. Among them, the Garoto Cidadão program stands out, a sociocultural project that serves 2,533 children and adolescents in the main cities where the company is inserted. In the last quarter of 2022, two new units were inaugurated, one in the urban area of Coxim/MS and the other in Heliopolis/SP. In total, more than 10,000 young people have already passed through the project.

¹ Young people benefited by the projects Citizen Boy, Empower, Young Apprentice, Internship, Steel Drums and Football.

² Public present in the public presentations, carried out by the projects: Citizen Boy, Truck, Steel Drums, Cultural Center and Stories That Stay.

In continuity with the legacy built by the CSN Fundação, the Company implemented in 2022 a new instrument to integrate its strategic planning of social-private investment: the Theory of Change of the CSN Group (access here). Focusing on improving the economic, social and environmental conditions of local communities, this new tool determines a strategic positioning of territorial development based on contemporary models of Corporate Social Investment (CSI). The theory is based on three strategic pillars: urban entrepreneurism, urban jobs, and rural productive inclusion. More details on the process of building and developing the Theory of Change will be made available in the Integrated Report 2022, scheduled to be published in April 2023.

Additionally, in compliance with the commitment signed in 2021, CSN Mineração and CSN Fundação began in 4Q22 the development of a due diligence on human rights in the municipality of Congonhas/MG. In partnership with the Center for Human Rights and Companies of the Getúlio Vargas Foundation, a research was initiated focusing on the internal evaluation of processes, systems and people, regarding the identification and management of Adverse Risks to Human Rights in the communities close to the operation of the Casa de Pedra mine, based on the UN Guiding Principles framework for Business & Human Rights. The completion of the process and its developments are planned for the first half of 2023.

For more information, visit the website: www.fundacaocsn.org.br.

Capital Markets

(In thousands of reais - R$, unless otherwise stated)

In the fourth quarter of 2022, CSN's shares appreciated by 14.4%, while the Ibovespa index declined by 0.3%. In 2022, CSN shares fell by 41.8% while the Ibovespa rose by 4.7%. The average daily value (CSNA3) traded on B3, was BRL 185.21 million in 4Q22 and BRL 223.51 million in 2022. On the New York Stock Exchange (NYSE), American Depositary Receipts (ADRs) of the Company appreciated by 16.0% in dollars, while the Dow Jones index rose by 15.4%. The average daily trading volume of ADRs (SID) on the NYSE in 4Q22 was US$ 10.9 million.