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20. SHAREHOLDERS' EQUITY
 12 Months Ended
Dec. 31, 2018
Shareholders Equity  
SHAREHOLDERS' EQUITY

20.a) Paid-in capital

 

Fully subscribed and paid-in capital as of December 31, 2018 and December 31, 2017 is R$4,540,000 comprising 1,387,524,047 book-entry common shares without par value. Each common share entitles its holder to one vote in Shareholders’ Meetings.

 

20.b) Authorized capital

 

The Company’s bylaws in effect as of December 31, 2018 determine that the capital can be raised to up to 2,400,000,000 shares by decision of the Board of Directors.

 

20.c) Legal reserve

 

This reserve is recognized at the rate of 5% of the profit for each period, as provided for by Article 193 of Law 6,404/76, up to the ceiling of 20% of share capital.

 

 

20.d) Ownership structure

 

As of December 31, 2018, the Company’s ownership structure was as follows:

            12/31/2018           12/31/2017
    Number of common shares   % of total shares   % of voting capital   Number of common shares   % of total shares   % of voting capital
Vicunha Aços S.A. (*)   679,522,254   48.97%   49.24%   682,855,454   49.21%   50.32%
Rio Iaco Participações S.A. (*)   58,193,503   4.19%   4.22%   58,193,503   4.19%   4.29%
NYSE (ADRs)   284,152,319   20.48%   20.59%   303,590,364   21.88%   22.37%
Other shareholders   358,246,471   25.82%   25.95%   312,493,726   22.52%   23.02%
Total shares outstanding    1,380,114,547   99.47%   100.00%    1,357,133,047   97.81%   100.00%
Treasury shares   7,409,500   0.53%       30,391,000   2.19%    
Total shares    1,387,524,047   100.00%        1,387,524,047   100.00%    

 

(*) Controlling group companies.

 

20.e) Treasury shares

 

The Board of Directors authorized various share buyback programs in order to hold shares in treasury for subsequent disposal and/or cancelation with a view to maximizing the generation of value to the shareholder through an efficient capital structure management, as shown in the table below:

 

Program   Board’s Authorization   Authorized quantity   Program period   Average buyback price   Minimum and maximum buyback price   Number bought back   Share cancelation   Disposal of shares   Balance in treasury
1º   3/13/2014      70,205,661   From 3/14/2014 to 4/14/2014   R$ 9.34   R$ 9,22 and R$ 9,45         2,350,000                                     2,350,000
2º   4/15/2014      67,855,661   From 4/16/2014 to 5/23/2014   R$ 8.97   R$ 8,70 and R$ 9,48         9,529,500                                   11,879,500
3º   5/23/2014      58,326,161   From 5/26/2014 to 6/25/2014   R$ 9.21   R$ 8,61 and R$ 9,72       31,544,500                                   43,424,000
4º   6/26/2014      26,781,661   From 6/26/2014 to 7/17/2014   R$ 10.42   R$ 9,33 and R$ 11,54       26,781,661                                   70,205,661
                   7/18/2014                                Not applicable   Not applicable                                 60,000,000 (1)       10,205,661
5º   7/18/2014      64,205,661   From 7/18/2014 to 8/18/2014    R$ 11.40   R$ 11.40            240,400                                   10,446,061
                   8/18/2014                                Not applicable   Not applicable                                 10,446,061 (1)                          
6º   8/18/2014      63,161,055   From 8/19/2014 to 9/25/2014    R$ 9.82   R$ 9,47 and R$ 10,07         6,791,300                                     6,791,300
7º   9/29/2014      56,369,755   From 9/29/2014 to 2/29/2014    R$ 7.49   R$ 4,48 and R$ 9,16       21,758,600                                   28,549,900
8º   12/30/2014      34,611,155   From 12/31/2014 to 3/31/2015    R$ 5.10   R$ 4,90 and R$ 5,39         1,841,100                                   30,391,000
9º (*)   03/31/2015      32,770,055   From 4/01/2015 to 6/30/2015                                                                                                                             30,391,000
    04/20/2018      30,391,000   From 4/20/2018 to 4/30/2018   Não aplicável   Não aplicável   R$ 0.00   R$ 0.00     22,981,500 (2)     7,409,500

 

(*) There were no share buyback in this program.

 

(1)In 2014 the Board of Directors approved the cancelation of 70,446,061 treasury shares without change in the Company’s share capital.
(2)In April 2018, the Board of Directors authorized the sale of up to 30,391,000 common shares held in treasury. Until the end of the program, 22,981,500 shares were sold for R$213,494. The Company. The Company recognized a profit on the sale of the shares in the amount of the amount of R$32,670.

 

As of December 31, 2018, the position of the treasury shares was as follows:

 

Quantity purchased (Units)   Amount paid for the shares   Share price   Market value of shares in 12/31/2018 (*)
     
    Minimum   Maximum   Average    
                7,409,500   R$ 58,264    R$       4.48    R$ 10.07    R$           7.86   R$ 65,500

 

 

(*) Using the last share average quotation on B3 S.A. - Brasil, Bolsa, Balcão as of September 30, 2018 of R$ 8.84 per share.

 

 

20.f) Policy on investments and payment of interest on capital and dividends

 

The Company adopts a profit distribution policy which, after compliance with the provisions in Law 6,404/76, as amended by Law 9,457/97, will entail the allocation of all the profit to the Company’s shareholders, provided that the following priorities are observed, irrespective of their order: (i) carrying out the business strategy; (ii) fulfilling its obligations; (iii) making the required investments; and (iv) maintaining a healthy financial situation of the Company.

 

 

20.g) Earnings/(loss) per share:

 

Basic earnings per share were calculated based on the profit/loss attributable to the owners of CSN divided by the weighted average number of common shares outstanding during the year, excluding the common shares purchased and held as treasury shares, as follows:

 

  12/31/2018   12/31/2017   12/31/2016
  Common Shares 
(Loss) profit for the year  
Continued operations 5,074,136   10,272   (925,186)
Discontinued operations -   -   (9,561)
               5,074,136                     10,272   (934,747)
Weighted average number of shares       1,373,250,595         1,357,133,047   1,357,133,047
Basic and diluted EPS                         
Continued Operations 3.69498                   0.00757   (0.68172)
Discontinued Operations -   -   (0.00704)
  3.69498   0.00757   (0.68876)

  

The Company does not hold potential dilutable outstanding ordinary shares that could result in dilution of earnings per share.