6-K 1 sidfs1q19_6k.htm FORM 6-K

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934
For the month of May, 2019
Commission File Number 1-14732

COMPANHIA SIDERÚRGICA NACIONAL
(Exact name of registrant as specified in its charter)
National Steel Company
(Translation of Registrant's name into English)
Av. Brigadeiro Faria Lima 3400, 20º andar
São Paulo, SP, Brazil
04538-132
(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F. Form 20-F ___X___ Form 40-F _______

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes _______ No ___X____

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# Table of Contents

Company Information |
Capital Breakdown | 1
Parent Company Financial Statements |
Balance Sheet – Assets | 2
Balance Sheet – Liabilities | 3
Statement of Income | 4
Statement of Comprehensive Income | 5
Statement of Cash Flows | 6
Statement of Changes in Shareholders’ Equity |
01/01/2019 to 03/31/2019 | 7
01/01/2018 to 03/31/2018 | 8
Statement of Value Added | 9
Consolidated Financial Statements |
Balance Sheet - Assets | 10
Balance Sheet - Liabilities | 11
Statement of Income | 12
Statement of Comprehensive Income | 13
Statement of Cash Flows | 14
Statement of Changes in Shareholders’ Equity |
01/01/2019 to 03/31/2019 | 15
01/01/2018 to 03/31/2018 | 16
Statement of Value Added | 17
Comments on the Company’s Consolidated Performance | 18
Notes to the quarterly financial information | 31
Comments on the Performance of Business Projections | 83
Reports and Statements |
Unqualified Independent Auditors’ Review Report | 87
Officers Statement on the Financial Statements | 89
Officers Statement on Auditor’s Report | 90

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Company Information / Capital Breakdown

Number of Shares (Units) | Current Quarter 03/31/2019
Paid-in Capital |
Common | 1,387,524,047
Preferred | 0
Total | 1,387,524,047
Treasury Shares |
Common | 7,409,500
Preferred | 0
Total | 7,409,500

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Parent Company Financial Statements / Balance Sheet - Assets
(R$ thousand)
Code | Description | Current Quarter | Previous Year
03/31/2019 | 12/31/2018
1 | Total Assets | 43,837,828 | 42,515,849
1.01 | Current assets | 9,060,067 | 8,668,688
1.01.01 | Cash and cash equivalent | 293,986 | 539,853
1.01.02 | Financial investments | 775,068 | 882,997
1.01.02.03 | Financial investments at amortized cost | 775,068 | 882,997
1.01.03 | Trade receivables | 2,235,789 | 1,965,817
1.01.04 | Inventory | 4,034,457 | 3,662,466
1.01.08 | Other current assets | 1,720,767 | 1,617,555
1.01.08.03 | Others | 1,720,767 | 1,617,555
1.02 | Non-current assets | 34,777,761 | 33,847,161
1.02.01 | Long-term assets | 4,101,910 | 4,002,570
1.02.01.10 | Other non-current assets | 4,101,910 | 4,002,570
1.02.02 | Investments | 21,010,134 | 20,232,005
1.02.03 | Property, plant and equipment | 9,618,041 | 9,562,973
1.02.03.01 | Property, plant and equipment in operation | 9,562,435 | 9.562.973
1.02.03.02 | Right of use in progress | 55,606 | 0
1.02.04 | Intangible assets | 47,676 | 49,613

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Parent Company Financial Statements / Balance Sheet – Liabilities
(R$ thousand)
Code | Description | Current Quarter | Previous Year
03/31/2019 | 12/31/2018
2 | Total liabilities | 43,837,828 | 42,515,849
2.01 | Current liabilities | 11,096,854 | 11,191,230
2.01.01 | Payroll and related taxes | 139,767 | 135,255
2.01.02 | Trade payables | 2,536,172 | 2,655,091
2.01.03 | Tax payables | 50,558 | 116,336
2.01.04 | Borrowings and financing | 6,214,189 | 6,474,388
2.01.05 | Other payables | 2,092,329 | 1,745,304
2.01.05.02 | Others | 2,092,329 | 1,745,304
2.01.05.02.04 | Dividends and interests on shareholder´s equity | 900,541 | 900,541
2.01.05.02.05 | Advances from clients | 75,843 | 64,416
2.01.05.02.06 | Trade payables – Drawee risk | 300,947 | 65,766
2.01.05.02.07 | Lease liabilities | 20,453 | 0
2.01.05.02.08 | Other obligations | 794,545 | 714,581
2.01.06 | Provisions | 63,839 | 64,856
2.01.06.01 | Provision for tax, social security, labor and civil risks | 63,839 | 64,856
2.02 | Non-current liabilities | 23,895,628 | 22,621,884
2.02.01 | Long term Borrowings and financing | 18,850,065 | 17,687,208
2.02.02 | Other payables | 44,703 | 24,024
2.02.02.02 | Others | 44,703 | 24,024
2.02.02.02.03 | Lease liabilities | 35,271 | 0
2.02.02.02.04 | Other obligations | 9,432 | 24,024
2.02.03 | Deferred Taxes | 62,690 | 17,434
2.02.04 | Provisions | 4,938,170 | 4,893,218
2.02.04.01 | Provision for tax, social security, labor and civil risks | 469,665 | 538,077
2.02.04.02 | Other provisions | 4,468,505 | 4,355,141
2.02.04.02.03 | Provision for environmental liabilities and decommissioning of assets | 186,726 | 191,884
2.02.04.02.04 | Pension and healthcare plan | 905,119 | 905,119
2.02.04.02.05 | Provision for losses on investments | 3,376,660 | 3,258,138
2.03 | Shareholders’ equity | 8,845,346 | 8,702,735
2.03.01 | Share Capital | 4,540,000 | 4,540,000
2.03.02 | Capital reserves | 32,720 | 32,720
2.03.04 | Profit reserves | 3,064,827 | 3,064,827
2.03.04.01 | Legal reserve | 189,122 | 189,122
2.03.04.02 | Earnings reserves | 2,933,969 | 2,933,969
2.03.04.09 | Treasury shares | (58,264) | (58,264)
2.03.05 | Accumulated profit/(losses) | (7,572) | 0
2.03.08 | Other comprehensive income | 1,215,371 | 1,065,188

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Parent Company Financial Statements / Statements of Income (R$ thousand)
|  | Year to date | YTD previous year
Code | Description | 01/01/2019 to 03/31/2019 | 01/01/2018 to 03/31/2018
3.01 | Revenues from sale of goods and rendering of services | 3,021,217 | 3,028,977
3.02 | Costs from sale of goods and rendering of services | (2,833,088) | (2,337,373)
3.03 | Gross profit | 188,129 | 691,604
3.04 | Operating expenses/income | 308,308 | 1,632,771
3.04.01 | Selling expenses | (120,144) | (154,662)
3.04.02 | General and administrative expenses | (56,117) | (73,543)
3.04.04 | Other operating income | 219,694 | 1,938,914
3.04.05 | Other operating expenses | (284,595) | (103,815)
3.04.06 | Equity in results of affiliated companies | 549,470 | 25,877
3.05 | Profit before financial income (expenses) and taxes | 496,437 | 2,324,375
3.06 | Financial income (expenses) | (458,764) | (392,862)
3.06.01 | Financial income | 101,370 | 30,326
3.06.02 | Financial expenses | (560,134) | (423,188)
3.06.02.01 | Net exchange differences over financial instruments | (72,099) | (1,996)
3.06.02.02 | Financial expenses | (488,035) | (421,192)
3.07 | Profit (loss) before taxes | 37,673 | 1,931,513
3.08 | Income tax and social contribution | (45,245) | (459,650)
3.09 | Profit (loss) from continued operations | (7,572) | 1,471,863
3.11 | Profit (loss) for the year | (7,572) | 1,471,863
3.99 | Earnings per share – (Reais / Share) |  |
3.99.01 | Basic earnings per share |  |
3.99.01.01 | Common shares | (0.00551) | 1.08454
3.99.02 | Diluted earnings per share |  |
3.99.02.01 | Common shares | (0.00551) | 1.08454

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Parent Company Statements / Statement of Comprehensive Income (R$ thousand) |  |
|  | Year to date | YTD previous year
Code | Description | 01/01/2019 to 03/31/2019 | 01/01/2018 to 03/31/2018
4.01 | (Loss) profit for the year | (7,572) | 1,471,863
4.02 | Other comprehensive income | 150,183 | (1,531,466)
4.02.01 | Actuarial (loss) /gain over pension plan of affiliates, net of taxes | 30 | 30
4.02.02 | Cumulative translation adjustments for the year | (21,804) | 37,958
4.02.03 | Fair value through other comprehensive income | 0 | (1,559,680)
4.02.04 | Gain (loss) on cash flow hedge accounting | (18,440) | (18,646)
4.02.05 | Realization of cash flow hedge accounting reclassified to income statement | 184,217 | 13,732
4.02.06 | Gain (Loss) on net investment hedge from investments in affiliates | 6,180 | (4,860)
4.03 | Comprehensive income for the year | 142,611 | (59,603)

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Parent Company Financial Statements / Statements of Cash Flows – Indirect Method (R$ thousand)
|  | Year to date | YTD previous year
Code | Description | 01/01/2019 to 03/31/2019 | 01/01/2018 to 03/31/2018
6.01 | Net cash from operating activities | (948,165) | 4,361,055
6.01.01 | Cash from operations | 82,028 | 582,035
6.01.01.01 | Profit (loss) for the period | (7,572) | 1,471,863
6.01.01.02 | Financial charges in borrowing and financing raised | 349,039 | 383,382
6.01.01.03 | Financial charges in borrowing and financing granted | (12,414) | (9,680)
6.01.01.04 | Depreciation, depletion and amortization | 158,007 | 142,547
6.01.01.05 | Equity in results of affiliated companies | (549,470) | (25,877)
6.01.01.06 | Deferred tax | 45,256 | 459,650
6.01.01.07 | Provision for tax, social security, labor, civil and environmental risks | (69,429) | 3,946
6.01.01.08 | Exchange differences, net | 261,128 | 30,811
6.01.01.09 | Write-off and net reversal losses | 13,542 | 16
6.01.01.10 | Provision for environmental liabilities and decommissioning of assets | (5,158) | (6,389)
6.01.01.11 | Shares classified as fair value through profit or loss | (127,653) | (1,936,389)
6.01.01.12 | Charges on lease liabilities | 965 | 0
6.01.01.13 | Provision (Reversal) for consumption and services | 19,504 | 62,285
6.01.01.14 | Eletrobrás monetary correction | 1,715 | 0
6.01.01.15 | Other provisions | 7,998 | 5,870
6.01.02 | Changes in assets and liabilities | (1,030,193) | 3,779,020
6.01.02.01 | Trade receivables - third parties | 16,862 | 3,037
6.01.02.02 | Trade receivables - related parties | (275,407) | (70,816)
6.01.02.03 | Inventories | (371,991) | (185,409)
6.01.02.04 | Receivables - related parties/Dividends | (635) | 4,141,385
6.01.02.05 | Tax assets | (54,342) | (53,572)
6.01.02.06 | Judicial deposits | (11,405) | (12,502)
6.01.02.09 | Trade payables | (118,919) | 374,701
6.01.02.10 | Trade payables – Drawee risk | 235,181 | 36.831
6.01.02.11 | Payroll and related taxes | 4,512 | (11,908)
6.01.02.12 | Taxes in installments – REFIS | (65,858) | 24,933
6.01.02.13 | Payables to related parties | (6,136) | (11,489)
6.01.02.15 | Interest paid | (368,593) | (462,122)
6.01.02.16 | Interest received | 0 | 1,522
6.01.02.19 | Others | (13,462) | 4,429
6.02 | Net cash used in investing activities | (104,805) | (86,620)
6.02.01 | Investments/Advance for future capital increase | (4,847) | (10,033)
6.02.02 | Purchase of property, plant and equipment | (158,189) | (77,246)
6.02.05 | Intercompany loans granted | (49,698) | (36,362)
6.02.06 | Intercompany loans received | 0 | 8,429
6.02.08 | Financial Investments, net of redemption | 107,929 | (10,785)
6.02.09 | Cash received from the sale of Usiminas shares | 0 | 39,377
6.03 | Net cash used in financing activities | 807,103 | (3,746,350)
6.03.01 | Borrowings and financing | 2,246,890 | 0
6.03.02 | Borrowings and financing – related parties | 1,581,639 | 0
6.03.03 | Transaction Costs | (28,810) | (24,025)
6.03.04 | Amortization of borrowings and financing | (2,763,750) | (440,899)
6.03.05 | Amortization of borrowings and financing - related parties | (222,553) | (3,281,426)
6.03.02 | Amortization of leases | (6,313) | 0
6.05 | Increase (decrease) in cash and cash equivalents | (245,867) | 528,085
6.05.01 | Cash and equivalents at the beginning of the year | 539,853 | 393,504
6.05.02 | Cash and equivalents at the end of the year | 293,986 | 921,589

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Parent Company Financial Statements / Statement of Changes in Equity - 01/01/2019 to 03/31/2019
(R$ thousand)
Code | Description | Paid-in capital | Capital reserve granted options and treasury shares | Earnings reserve | Retained earnings (accumulated losses) | Other comprehensive income | Shareholders' equity
5.01 | Opening balances | 4,540,000 | 32,720 | 3,064,827 | 0 | 1,065,188 | 8,702,735
5.03 | Adjusted opening balances | 4,540,000 | 32,720 | 3,064,827 | 0 | 1,065,188 | 8,702,735
5.05 | Total comprehensive income | 0 | 0 | 0 | (7,572) | 150,183 | 142,611
5.05.01 | Profit (loss) for the period | 0 | 0 | 0 | (7,572) | 0 | (7,572)
5.05.02 | Other comprehensive income | 0 | 0 | 0 | 0 | 150,183 | 150,183
5.05.02.04 | Translation adjustments for the year | 0 | 0 | 0 | 0 | (21,804) | (21,804)
5.05.02.06 | Actuarial gains/(Losses) on pension plan, net of taxes | 0 | 0 | 0 | 0 | 30 | 30
5.05.02.07 | (Loss) / gain on cash flow hedge accounting, net of taxes | 0 | 0 | 0 | 0 | 165,777 | 165,777
5.05.02.08 | (Loss) / gain on foreign investments | 0 | 0 | 0 | 0 | 6,180 | 6,180
5.07 | Closing balance | 4,540,000 | 32,720 | 3,064,827 | (7,572) | 1,215,371 | 8,845,346

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Parent Company Financial Statements / Statement of Changes in Equity - 01/01/2018 to 03/31/2018
(R$ thousand)
Code | Description | Paid-in capital | Capital reserve granted options and treasury shares | Earnings reserve | Retained earnings (accumulated losses) | Other comprehensive income | Shareholders' equity
5.01 | Opening balances | 4,540,000 | 30 | 0 | (1,291,689) | 3,779,032 | 7,027,373
5.03 | Adjusted opening balances | 4,540,000 | 30 | 0 | (1,291,689) | 3,779,032 | 7,027,373
5.05 | Total comprehensive income | 0 | 0 | 0 | 1,471,863 | (1,531,466) | (59,603)
5.05.01 | Profit (loss) for the period | 0 | 0 | 0 | 1,471,863 | 0 | 1,471,863
5.05.02 | Other comprehensive income | 0 | 0 | 0 | 0 | (1,531,466) | (1,531,466)
5.05.02.04 | Translation adjustments for the year | 0 | 0 | 0 | 0 | 37,958 | 37,958
5.05.02.06 | Actuarial gains/(Losses) on pension plan, net of taxes | 0 | 0 | 0 | 0 | 30 | 30
5.05.02.07 | Available-for-sale assets, net of taxes | 0 | 0 | 0 | 0 | (1,559,680) | (1,559,680)
5.05.02.08 | (Loss) / gain on cash flow hedge accounting, net of taxes | 0 | 0 | 0 | 0 | (4,914) | (4,914)
5.05.02.09 | (Loss) / gain on foreign investments | 0 | 0 | 0 | 0 | (4,860) | (4,860)
5.07 | Closing balance | 4,540,000 | 30 | 0 | 180,174 | 2,247,566 | 6,967,770

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Parent Company Financial Statements / Statement of Value Added
(R$ thousand)
|  | Year to date | Previous year
Code | Description | 01/01/2019 to 03/31/2019 | 01/01/2018 to 03/31/2018
7.01 | Revenues | 3.901.138 | 5,679,845
7.01.01 | Sales of products and rendering of services | 3.751.792 | 3,750,436
7.01.02 | Other revenues | 127.754 | 1,936,419
7.01.04 | Allowance for (reversal of) doubtful accounts | 21.592 | (7,010)
7.02 | Raw materials acquired from third parties | (3,373,861) | (2,716,816)
7.02.01 | Cost of sales and services | (3,060,346) | (2,433,300)
7.02.02 | Materials, electric power, outsourcing and other | (304,580) | (285,278)
7.02.03 | Impairment/recovery of assets | (8,935) | 1,762
7.03 | Gross value added | 527.277 | 2,963,029
7.04 | Retentions | (158,007) | (142,547)
7.04.01 | Depreciation, amortization and depletion | (158,007) | (142,547)
7.05 | Wealth created | 369,270 | 2,820,482
7.06 | Value added received | 657,660 | 84,720
7.06.01 | Equity in results of affiliated companies | 549,470 | 25,877
7.06.02 | Financial income | 101,370 | 30,326
7.06.03 | Others | 6,820 | 28,517
7.06.03.01 | Others and exchange gains | 6,820 | 28,517
7.07 | Wealth for distribution | 1,026,930 | 2,905,202
7.08 | Wealth distributed | 1,026,930 | 2,905,202
7.08.01 | Personnel | 347,839 | 298,847
7.08.01.01 | Salaries and wages | 241,697 | 220,044
7.08.01.02 | Benefits | 70,631 | 62,275
7.08.01.03 | Severance payment (FGTS) | 35,511 | 16,528
7.08.02 | Taxes, fees and contributions | 119,424 | 680,901
7.08.02.01 | Federal | 60,064 | 604,936
7.08.02.02 | State | 59,360 | 75,962
7.08.02.03 | Municipal | 0 | 3
7.08.03 | Remuneration on third-party capital | 567,239 | 453,591
7.08.03.01 | Interest | 488,035 | 421,192
7.08.03.02 | Leases | 1,030 | 2,212
7.08.03.03 | Others | 78,174 | 30,187
7.08.03.03.01 | Others and exchange losses | 78,174 | 30,187
7.08.04 | Remuneration on Shareholders' capital | (7,572) | 1,471,863
7.08.04.03 | Retained earnings (accumulated losses) | (7,572) | 1,471,863

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Consolidated Financial Statements / Balance Sheet - Assets
(R$ thousand)
Code | Description | Current Quarter | Previous Year
03/31/2019 | 12/31/2018
1 | Total Assets | 49,952,506 | 47,327,524
1.01 | Current assets | 13,825,742 | 12,014,483
1.01.01 | Cash and cash equivalent | 2,702,077 | 2,248,004
1.01.02 | Financial investments | 778,608 | 895,713
1.01.02.03 | Financial investments measured at amortized cost | 778,608 | 895,713
1.01.03 | Trade receivables | 2,835,396 | 2,078,182
1.01.04 | Inventory | 5,665,830 | 5,039,560
1.01.08 | Other current assets | 1,843,831 | 1,753,024
1.01.08.03 | Others | 1,843,831 | 1,753,024
1.02 | Non-current assets | 36,126,764 | 35,313,041
1.02.01 | Long-term assets | 4,419,990 | 4,382,389
1.02.01.03 | Financial investments measured at amortized cost | 7,829 | 7,772
1.02.01.07 | Deferred tax assets | 69,465 | 89,394
1.02.01.10 | Other non-current assets | 4,342,696 | 4,285,223
1.02.02 | Investments | 5,791,267 | 5,630,613
1.02.03 | Property, plant and equipment | 18,682,759 | 18,046,864
1.02.03.01 | Property, plant and equipment in operation | 18,052,983 | 18.046.864
1.02.03.02 | Right of use in progress | 629,776 | 0
1.02.04 | Intangible assets | 7,232,748 | 7,253,175

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Consolidated Financial Statements / Balance Sheet – Liabilities
(R$ thousand)
Code | Description | Current Quarter | Previous Year
03/31/2019 | 12/31/2018
2 | Total liabilities | 49,952,506 | 47,327,524
2.01 | Current liabilities | 12,077,635 | 11,438,552
2.01.01 | Payroll and related taxes | 261,717 | 248,185
2.01.02 | Trade payables | 3,228,213 | 3,408,056
2.01.03 | Tax payables | 535,681 | 251,746
2.01.04 | Borrowings and financing | 5,415,138 | 5,653,439
2.01.05 | Other payables | 2,530,746 | 1,770,623
2.01.05.02 | Others | 2,530,746 | 1,770,623
2.01.05.02.04 | Dividends and interests on shareholder´s equity | 932,005 | 932,005
2.01.05.02.05 | Advances from clients | 563,002 | 137,418
2.01.05.02.06 | Trade payables – Drawee risk | 300,947 | 65,766
2.01.05.02.07 | Lease liabilities | 45,742 | 0
2.01.05.02.08 | Other provisions | 689,050 | 635,434
2.01.06 | Provisions | 106,140 | 106,503
2.01.06.01 | Provision for tax, social security, labor and civil risks | 106,140 | 106,503
2.02 | Non-current liabilities | 27,624,483 | 25,875,532
2.02.01 | Long term Borrowings and financing | 22,887,556 | 23,173,635
2.02.02 | Other payables | 2,259,172 | 227,328
2.02.02.02 | Others | 2,259,172 | 227,328
2.02.02.02.03 | Advances from clients | 1,469,166 | 0
2.02.02.02.04 | Lease liabilities | 587,496 | 0
2.02.02.02.05 | Other payables | 202,510 | 227,328
2.02.03 | Deferred tax liabilities | 667,907 | 601,731
2.02.04 | Provisions | 1,809,848 | 1,872,838
2.02.04.01 | Provision for tax, social security, labor and civil risks | 615,371 | 685,953
2.02.04.02 | Other provisions | 1,194,477 | 1,186,885
2.02.04.02.03 | Provision for environmental liabilities and decommissioning of assets | 289,358 | 281,766
2.02.04.02.04 | Pension and healthcare plan | 905,119 | 905,119
2.03 | Consolidated Shareholders’ equity | 10,250,388 | 10,013,440
2.03.01 | Share Capital | 4,540,000 | 4,540,000
2.03.02 | Capital reserves | 32,720 | 32,720
2.03.04 | Profit reserves | 3,064,827 | 3,064,827
2.03.04.01 | Legal reserve | 189,122 | 189,122
2.03.04.02 | Earnings reserves | 2,933,969 | 2,933,969
2.03.04.09 | Treasury shares | (58,264) | (58,264)
2.03.05 | Accumulated profit/(losses) | (7,572) | 0
2.03.08 | Other comprehensive income | 1,215,371 | 1,065,188
2.03.09 | Profit attributable to the non-controlling interests | 1,405,042 | 1,310,705

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Consolidated Financial Statements / Statements of Income (R$ thousand)
|  | Year to date | YTD previous year
Code | Description | 01/01/2019 to 03/31/2019 | 01/01/2018 to 03/31/2018
3.01 | Revenues from sale of goods and rendering of services | 6,005,466 | 5,065,950
3.02 | Costs from sale of goods and rendering of services | (4,021,495) | (3,684,743)
3.03 | Gross profit | 1,983,971 | 1,381,207
3.04 | Operating expenses/income | (803,252) | 1,257,703
3.04.01 | Selling expenses | (573,484) | (456,503)
3.04.02 | General and administrative expenses | (120,181) | (107,573)
3.04.04 | Other operating income | 228,952 | 1,945,587
3.04.05 | Other operating expenses | (364,372) | (148,659)
3.04.06 | Equity in results of affiliated companies | 25,833 | 24,851
3.05 | Profit before financial income (expenses) and taxes | 1,180,719 | 2,638,910
3.06 | Financial income (expenses) | (635,099) | (593,704)
3.06.01 | Financial income | 111,314 | 42,896
3.06.02 | Financial expenses | (746,413) | (636,600)
3.06.02.01 | Net exchange differences over financial instruments | (113,564) | (113,344)
3.06.02.02 | Financial expenses | (632,849) | (523,256)
3.07 | Profit (loss) before taxes | 545,620 | 2,045,206
3.08 | Income tax and social contribution | (458,857) | (558,711)
3.09 | Profit (loss) from continued operations | 86,763 | 1,486,495
3.11 | Consolidated Profit (loss) for the year | 86,763 | 1,486,495
3.11.01 | Profit attributable to the controlling interests | (7,572) | 1,471,863
3.11.02 | Profit attributable to the non-controlling interests | 94,335 | 14,632
3.99.01 | Basic earnings per share |  |
3.99.01.01 | Common shares | (0.00551) | 1.08454
3.99.02 | Diluted earnings per share |  |
3.99.02.01 | Common shares | (0.00551) | 1.08454

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Consolidated Financial Statements / Statement of Comprehensive Income (R$ thousand)
|  | Year to date | YTD previous year
Code | Description | 01/01/2019 to 03/31/2019 | 01/01/2018 to 03/31/2018
4.01 | Consolidated profit (loss) for the year | 86,763 | 1,486,495
4.02 | Other comprehensive income | 150,183 | (1,531,466)
4.02.01 | Actuarial gains over pension plan of affiliates, net of taxes | 30 | 30
4.02.02 | Cumulative translation adjustments for the year | (21,804) | 37,958
4.02.03 | Fair value through other comprehensive income | 0 | (1,559,680)
4.02.04 | Gain (loss) on cash flow hedge accounting | (18,440) | (18,646)
4.02.05 | Realization of cash flow hedge accounting reclassified to income statement | 184,217 | 13,732
4.02.06 | Gain (Loss) on hedge of net investment in foreign operations. | 6,180 | (4,860)
4.03 | Consolidated comprehensive income for the year | 236,946 | (44,971)
4.03.01 | Attributed to controlling Shareholders | 142,611 | (59,603)
4.03.02 | Attributed to non-controlling Shareholders | 94,335 | 14,632

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Consolidated Financial Statements / Statements of Cash Flows – Indirect Method
(R$ thousand)
|  | Year to date | YTD previous year
Code | Description | 01/01/2019 to 03/31/2019 | 01/01/2018 to 03/31/2018
6.01 | Net cash from operating activities | 1,185,970 | 459,217
6.01.01 | Cash from operations | 1,018,203 | 863,868
6.01.01.01 | Profit (loss) attributable to the controlling interests | (7,572) | 1,471,863
6.01.01.02 | Profit (loss) attributable to the non-controlling interests | 94,335 | 14,632
6.01.01.03 | Financial charges in borrowing and financing raised | 465,928 | 462,685
6.01.01.04 | Financial charges in borrowing and financing granted | (13,946) | (11,175)
6.01.01.05 | Depreciation, depletion and amortization | 328,070 | 315,872
6.01.01.06 | Equity in in results of affiliated companies | (25,833) | (24,851)
6.01.01.07 | Deferred tax | 89,039 | 438,797
6.01.01.08 | Provision for tax, social security, labor, civil and environmental risks | (69,853) | 1,046
6.01.01.09 | Monetary variations and Exchange differences, net | 241,297 | 51,488
6.01.01.11 | Shares classified as fair value through profit or loss | (127,653) | (1,936,389)
6.01.01.12 | Write-off and net reversal losses | 13,712 | 1,780
6.01.01.13 | Provision (Reversal) for consumption and services | 8,853 | 41,533
6.01.01.14 | Provision for environmental liabilities and decommissioning of assets | 7,592 | (3,270)
6.01.01.15 | Charges on lease liabilities | 4,957 | 0
6.01.01.16 | Eletrobrás monetary correction | (1,715) | 0
6.01.01.17 | Others | 10,992 | 39,857
6.01.02 | Changes in assets and liabilities | 167,767 | (404,651)
6.01.02.01 | Trade receivables - third parties | (713,057) | 112,946
6.01.02.02 | Trade receivables - related parties | (92,283) | (24,304)
6.01.02.03 | Inventories | (653,465) | (420,862)
6.01.02.04 | Receivables - related parties | 447 | (10,408)
6.01.02.05 | Tax assets | (41,211) | (1,156)
6.01.02.06 | Judicial deposits | (11,569) | (12,443)
6.01.02.08 | Trade payables | (170,461) | 510,034
6.01.02.09 | Trade payables – Drawee risk | 235,181 | 36,831
6.01.02.10 | Payroll and related taxes | 14,014 | (19,827)
6.01.02.11 | Taxes in installments – REFIS | 282,973 | 1,673
6.01.02.12 | Payables to related parties | (30,173) | 2.553
6.01.02.13 | Adiantamento de clientes minério de ferro | 1,935,831 | 0
6.01.02.14 | Interest paid | (590,621) | (617,864)
6.01.02.16 | Others | 2,161 | 38,176
6.02 | Net cash used in investing activities | (220,750) | (213,570)
6.02.02 | Purchase of property, plant and equipment | (313,530) | (223,270)
6.02.03 | Acquisition of intangible assets | (49) | 0
6.02.04 | Receivable/(payable) from derivative financial instruments | 372 | 0
6.02.07 | Intercompany loans granted | (40,643) | (36,362)
6.02.08 | Intercompany loans received | 16,796 | -
6.02.09 | Financial Investments, net of redemption | 117,048 | 6,685
6.02.10 | Cash received from the sale of Usiminas shares | 0 | 39,377
6.03 | Net cash used in financing activities | (514,817) | (1,423,065)
6.03.01 | Borrowings and financing raised | 2,465,845 | 1,320,776
6.03.02 | Transaction cost | (28,810) | (51,156)
6.03.03 | Amortization of borrowings and financing | (2,939,145) | (2,190,683)
6.03.04 | Dividends paid | 0 | (502,002)
6.03.05 | Amortization of lease | (12,707) | 0
6.04 | Exchange rate on translating cash and cash equivalents | 3,670 | 0
6.05 | Increase (decrease) in cash and cash equivalents | 454,073 | (1,177,418)
6.05.01 | Cash and equivalents at the beginning of the year | 2,248,004 | 3,411,572
6.05.02 | Cash and equivalents at the end of the year | 2,702,077 | 2,234,154,

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Consolidated Financial Statements / Statements of Changes in Equity - 01/01/2019 to 03/31/2019
(R$ thousand)
Code | Description | Paid-in capital | Capital reserve, granted options and treasury shares | Earnings reserve | Retained earnings (accumulated losses) | Other comprehensive income | Shareholders' equity | Non-controlling interests | Consolidated shareholders' equity
5.01 | Opening balances | 4,540,000 | 32,720 | 3,064,827 | 0 | 1,065,188 | 8,702,735 | 1,310,705 | 10,013,440
5.03 | Adjusted opening balances | 4,540,000 | 32,720 | 3,064,827 | 0 | 1,065,188 | 8,702,735 | 1,310,705 | 10,013,440
5.05 | Total comprehensive income | 0 | 0 | 0 | (7,572) | 150,183 | 142,611 | 94,335 | 236,946
5.05.01 | Profit (loss) for the year | 0 | 0 | 0 | (7,572) | 0 | (7,572) | 94,335 | 86,763
5.05.02 | Other comprehensive income | 0 | 0 | 0 | 0 | 150,183 | 150,183 | 0 | 150,183
5.05.02.04 | Translation adjustments for the year | 0 | 0 | 0 | 0 | (21,804) | (21,804) | 0 | (21,804)
5.05.02.06 | Actuarial gains/(losses) on pension plan, net of taxes | 0 | 0 | 0 | 0 | 30 | 30 | 0 | 30
5.05.02.07 | (Loss) / gain on cash flow hedge accounting, net of taxes | 0 | 0 | 0 | 0 | 165,777 | 165,777 | 0 | 165,777
5.05.02.08 | (Loss) / gain on hedge of net investment in foreign operations | 0 | 0 | 0 | 0 | 6,180 | 6,180 | 0 | 6,180
5.06 | Internal changes in shareholders’ equity | 0 | 0 | 0 | 0 | 0 | 0 | 2 | 2
5.06.04 | Non-controlling interests in affiliates | 0 | 0 | 0 | 0 | 0 | 150,183 | 2 | 2
5.07 | Closing balance | 4,540,000 | 32,720 | 3,064,827 | (7,572) | 1,215,371 | 8,845,346 | 1,405,042 | 10,250,388

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Consolidated Financial Statements / Statements of Changes in Equity - 01/01/2018 to 03/31/2018
(R$ thousand)
Code | Description | Paid-in capital | Capital reserve, granted options and treasury shares | Earnings reserve | Retained earnings (accumulated losses) | Other comprehensive income | Shareholders' equity | Non-controlling interests | Consolidated shareholders' equity
5.01 | Opening balances | 4,540,000 | 30 | 0 | (1,291,689) | 3,779,032 | 7,027,373 | 1,260,856 | 8,288,229
5.03 | Adjusted opening balances | 4,540,000 | 30 | 0 | (1,291,689) | 3,779,032 | 7,027,373 | 1,260,856 | 8,288,229
5.05 | Total comprehensive income | 0 | 0 | 0 | 1,471,863 | (1,531,466) | (59,603) | 14,632 | (44,971)
5.05.01 | Profit (loss) for the year | 0 | 0 | 0 | 1,471,863 | - | 1,471,863 | 14,632 | 1,486,495
5.05.02 | Other comprehensive income | 0 | 0 | 0 | 0 | (1,531,466) | (1,531,466) | 0 | (1,531,466)
5.05.02.04 | Translation adjustments for the year | 0 | 0 | 0 | 0 | 37,958 | 37,958 | 0 | 37,958
5.05.02.06 | Actuarial gains on pension plan, net of taxes | 0 | 0 | 0 | 0 | 30 | 30 | 0 | 30
5.05.02.07 | Available-for-sale assets, net of taxes | 0 | 0 | 0 | 0 | (1,559,680) | (1,559,680) | 0 | (1,559,680)
5.05.02.08 | (Loss) / gain on cash flow hedge accounting, net of taxes | 0 | 0 | 0 | 0 | (4,914) | (4,914) | 0 | (4,914)
5.05.02.09 | (Loss) / gain on hedge of net investment in foreign operations | 0 | 0 | 0 | 0 | (4,860) | (4,860) | 0 | (4,860)
5.06 | Internal changes in shareholders’ equity | 0 | 0 | 0 | 0 | 0 | 0 | (19,638) | (19,638)
5.06.04 | Non-controlling interests in affiliates | 0 | 0 | 0 | 0 | 0 | 0 | (19,638) | (19,638)
5.07 | Closing balance | 4,540,000 | 30 | 0 | 180,174 | 2,247,566 | 6,967,770 | 1,255,850 | 8,223,620

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Consolidated Financial Statements / Statements of Value Added
(R$ thousand)
|  | Year to date | Previous year
Code | Description | 01/01/2019 to 03/31/2019 | 01/01/2018 to 03/31/2018
7.01 | Revenues | 6,948,101 | 7,781,869
7.01.01 | Sales of products and rendering of services | 6,795,881 | 5,850,130
7.01.02 | Other revenues | 131,521 | 1,940,033
7.01.04 | Allowance for (reversal of) doubtful debts | 20,699 | (8,294)
7.02 | Raw materials acquired from third parties | (4,677,204) | (3,950,032)
7.02.01 | Cost of sales and services | (3,742,381) | (3,238,366)
7.02.02 | Materials, electric power, outsourcing and other | (893,674) | (705,475)
7.02.03 | Impairment/recovery of assets | (41,149) | (6,191)
7.03 | Gross value added | 2,270,897 | 3,831,837
7.04 | Retentions | (328,070) | (315,872)
7.04.01 | Depreciation, amortization and depletion | (328,070) | (315,872)
7.05 | Wealth created | 1,942,827 | 3,515,965
7.06 | Value added received | 95,823 | 11,346
7.06.01 | Equity in results of affiliated companies | 25,833 | 24,851
7.06.02 | Financial income | 111,314 | 42,896
7.06.03 | Others | (41,324) | (56,401)
7.06.03.01 | Others and exchange gains | (41,324) | (56,401)
7.07 | Wealth for distribution | 2,038,650 | 3,527,311
7.08 | Wealth distributed | 2,038,650 | 3,527,311
7.08.01 | Personnel | 610,988 | 557,720
7.08.01.01 | Salaries and wages | 457,968 | 436,222
7.08.01.02 | Benefits | 108,793 | 100,501
7.08.01.03 | Severance payment (FGTS) | 44,227 | 20,997
7.08.02 | Taxes, fees and contributions | 631,219 | 896,795
7.08.02.01 | Federal | 551,594 | 796,634
7.08.02.02 | State | 74,681 | 94,051
7.08.02.03 | Municipal | 4,944 | 6,110
7.08.03 | Remuneration on third-party capital | 709,680 | 586,301
7.08.03.01 | Interest | 632,849 | 523,256
7.08.03.02 | Leases | 5,342 | 6,425
7.08.03.03 | Others | 71,489 | 56,620
7.08.03.03.01 | Others and exchange losses | 71,489 | 56,620
7.08.04 | Remuneration on Shareholders' capital | 86,763 | 1,486,495
7.08.04.03 | Retained earnings (accumulated losses) | (7,572) | 1,471,863
7.08.04.04 | Non-controlling interests in retained earnings | 94,335 | 14,632

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Comments on the Company’s Consolidated Performance

1Q19 Earnings Release

Companhia Siderúrgica Nacional (CSN) (BM&FBOVESPA: CSNA3) (NYSE: SID) announces today its consolidated results for the first quarter of 2019 (1Q19), which are presented in Brazilian Reais and in accordance with International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB), and with Brazilian accounting practices, which are fully convergent with international accounting norms, issued by the Accounting Pronouncements Committee (CPC) and approved by the Brazilian Securities and Exchange Commission (CVM), pursuant to CVM Instruction 485 of September 1, 2010. All comments presented herein refer to the Company’s consolidated results for the first quarter of 2019 (1Q19) and comparisons refer to the fourth quarter of 2018 (4Q18) and the first quarter of 2018 (1Q18), unless otherwise stated. The real/U.S. dollar exchange rate was R$3.8967 on 03/30/2019 and R$3.8748 on 12/31/2018.

Operating and Financial Highlights

· Adjusted EBITDA totaled R$1,724MM, up 39% over 1Q18 and 11% over 4Q18. The EBITDA margin increased 4.2p.p., to 27.7%, fueled by the strong mining performance.

· Mining EBITDA reached R$1,259MM, 51% more than in 4Q18, with an increase of around 68% in EBITDA/ton in the segment, thanks to better realized prices.

· 4% growth in the volume of steel sales in the domestic market in relation to 1Q18, with maintenance of the level of coated products.

· The leverage ratio fell 0.48x, from 4.55x in 4Q18 to 4.07x, thanks to higher EBITDA and lower debt.

Highlights | 1Q18 | 4Q18 | 1Q19 |  | Change
| 1Q19 | x | 1Q18 | 1Q19 | x | 4Q18
Steel sales (thousand t) | 1,277 | 1,181 | 1,175 |  | (8%) | (0%)
- Domestic market | 782 | 835 | 811 |  | 4% | (3%)
- Subsidiaries abroad | 436 | 299 | 340 |  | (22%) | 14%
- Exports | 60 | 46 | 24 |  | (60%) | (48%)
Iron ore sales (thousand t) | 7,474 | 9,889 | 8,859 |  | 19% | (10%)
- Domestic market | 1,309 | 1,366 | 1,169 |  | (11%) | (14%)
- Exports | 6,165 | 8,523 | 7,690 |  | 25% | (10%)
Consolidated results (R$ million) |  |  |  |  |  |  |  |  |  |
Net revenue | 5,066 | 6,051 | 6,005 |  | 19% | (1%)
Gross profit | 1,381 | 2,052 | 1,984 |  | 44% | (3%)
Adjusted EBITDA¹ | 1,242 | 1,560 | 1,724 |  | 39% | 11%
Adjusted net debt² | 26,508 | 26,616 | 25,772 |  | (3%) | (3%)
Adjusted cash and cash equivalents² | 3,070 | 3,274 | 3,601 |  | 17% | 10%
Net debt/adjusted EBITDA | 5.82x | 4.55x | 4.07x |  | -1.75x | -0.48x

¹Adjusted EBITDA is calculated based on net profit/loss, plus depreciation and amortization, income tax, net financial result, share of profit (loss) of investees and other operating income (expenses), and includes the proportionate share of EBITDA of the jointly-owned subsidiaries MRS Logística and CBSI. It includes the Company’s stakes of 100% in CSN Mineração, 37.27% in MRS and 50% in CBSI.

²Adjusted net debt and the adjusted cash position include the stakes of 100% in CSN Mineração, 37.27% in MRS and 50% in CBS excluding Forfaiting and drawee risk operations.

CSN’s Consolidated Results

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· Net revenue totaled R$6,005 million in 1Q19, up 19% over 1Q18 and down 1% from 4Q18. It remained in line with 4Q18, thanks to the improvement in the performance of the mining operations and steel seasonality.

· In 1Q19, the cost of goods sold totaled R$4,021 million, 9% more than in 1Q18 and 0.5% higher than in 4Q18. Compared to 4Q18, we saw an increase in slab costs in the Steel segment, due the end of blast furnace number 3 campaign, while mining showed a decrease in the COGS due to the lower sales volume.

· Gross profit stood at R$1,984 million in 1Q19, 3% less than in 4Q18. The gross margin fell 0.9p.p. from 4Q18, to 33% in 1Q19, due to an increase in steel costs, partially offset by the mining performance.

· General and administrative expenses totaled R$120 million, with a dilution from 2.1% (1Q18) to 2.0% (1Q19) of net revenue. Selling expenses amounted to R$573 million, or 9.5% of net revenue, 0.5p.p. more than in 1Q18 (9.0% of net revenue), due to the greater proportion of the transoceanic freight of iron ore in the CIF modality.

· Net other income (expenses) was an expense of R$135 million in 1Q19, mainly driven by the recognition of the hedge accounting result and other expenses, partially offset by the appreciation of Usiminas shares.

· The net financial result was an expense of R$635 million in 1Q19. Financial expenses (ex-exchange variation) edged up to R$633 million, as a result of the non-recurring increase in other financial expenses related to new issue, partially offset by a decline in the cost of debt.

Financial Result (R$ million) | 1Q18 | 4Q18 | 1Q19
Financial result – IFRS | (594) | 510 | (635)
Financial revenue | 43 | 884 | 111
Financial expenses | (637) | (374) | (746)
Financial expenses (ex-exchange rate variation) | (523) | (589) | (633)
Result with exchange rate variation | (113) | 215 | (114)
Monetary and exchange rate variation | (138) | 535 | (126)
Hedge accounting | 24 | (319) | 12
Derivative result | 1 | (1) | -

¹ The financial result includes the stakes of 100% in CSN Mineração, 37.27% in MRS and 50% in CBSI as of December 2015.

· CSN’s share of profit of investees was a positive R$26 million in 1Q19, versus a positive R$25 million in 1Q18, remaining flat as a result of stable results at MRS.

Share of Profit (Loss) of Investees (R$ million) | 1Q18 | 4Q18 | 1Q19 | Change
1Q19 | x | 1Q18 | 1Q19 | x | 4Q18
MRS Logística | 33 | 54 | 43 | 30% | (20%)
CBSI | 1 | 1 | 1 | - | -
TLSA | (3) | (4) | (6) | 100% | 50%
Arvedi Metalfer BR | 0 | (1) | - | - | -
Eliminations | (6) | (10) | (12) | 100% | 20%
Share of profit of investees | 25 | 40 | 26 | 4% | (35%)

· CSN recorded a net profit of R$87 million in 1Q19, versus a net profit of R$1,772 million in 4Q18.

Adjusted EBITDA (R$ million) | 1Q18 | 4Q18 | 1Q19 | Change
1Q19 | x | 1Q18 | 1Q19 | x | 4Q18
Net profit (loss) for the period | 1,486 | 1,772 | 87 | (94%) | (95%)
(-) Depreciation | 305 | 285 | 306 | 0% | 7%
(+) Income tax and social contribution | 559 | 89 | 459 | (18%) | 416%
(-) Net financial result | 594 | (510) | 635 | 7% | -
EBITDA (CVM Instruction 527) | 2,944 | 1,636 | 1,487 | (49%) | (9%)
(+) Other operating income (expenses) | (1,797) | (188) | 135 | - | -
(+) Share of profit (loss) of investees | (25) | (40) | (26) | 4% | (35%)
(-) Proportionate EBITDA of jointly-owned subsidiaries | 119 | 153 | 127 | 7% | (17%)
Adjusted EBITDA | 1,242 | 1,560 | 1,724 | 39% | 11%

¹The Company discloses adjusted EBITDA excluding interests in investments and other operating income (expenses) in the belief that these items should not be considered when calculating recurring operating cash flow.

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· Adjusted EBITDA amounted to R$1,724 million in 1Q19, versus R$1,242 million in 1Q18, due to an increase in the share of mining, while the adjusted EBITDA margin was 27.7%, 4.2p.p. higher year on year.

Adjusted EBITDA (R$ MM) and Adjusted EBITDA Margin (%)

¹The adjusted EBITDA margin is calculated as the ratio between adjusted EBITDA and adjusted net revenue, considering the stakes of 100% in CSN Mineração, 37.27% in MRS and 50% in CBSI as of December 2015.

Free Cash Flow

Operating cash flow, as measured by free cash flow, was negative by R$493 million, influenced by the temporary increase in working capital in the steel and mining sectors, to be reversed in the coming quarters.

Free Cash Flow R$MM | 1Q19 Free Cash Flow R$MM

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¹Our working capital includes changes in net current capital, excluding the impacts of the exchange rate variation and an advance from our customer Glencore.

Debt

On 03/30/2019, consolidated net debt totaled R$25,772 million, while the net debt/EBITDA ratio, calculated based on LTM adjusted EBITDA, stood at 4.09x, 1.73x less than in 1Q18.

Debt (R$MM) and Net Debt/Adjusted EBITDA(x)

Foreign Exchange Exposure

The net FX exposure + perpetual bond of our consolidated balance sheet on 3/30/2019 was US$726 million, as shown in the table below. It should be noted that the net foreign exchange exposure includes a liability of US$1.0 billion in line item “Loans and Financing” related to the perpetual bond, which, due to its nature, will not require disbursement to settle the principal amount in the foreseeable future.

The hedge accounting adopted by CSN correlates projected export inflows in dollars with part of the scheduled debt payments in the same currency. Therefore, the exchange variation of the dollar-denominated debt is temporarily booked under shareholders’ equity, being recorded in the income statement when dollar revenues from exports are received.

Foreign Exchange Exposure | 03/31/2018 | 12/31/2018 | 03/30/2019
(in thousands of U.S. dollars) | IFRS | IFRS | IFRS
Cash | 244 | 377 | 99
Accounts receivable | 322 | 358 | 486
Other | 4 | 9 | 7
Total assets | 571 | 743 | 593
Loans and financing | (4,236) | (4,117) | (4,053)
Trade payables | (175) | (175) | (125)
Other payables | (5) | (4) | (3)
Total liabilities | (4,417) | (4,295) | (4,181)
Natural foreign exchange exposure (assets - liabilities) | (3,846) | (3,552) | (3,589)
Derivatives, net | - |  |
Cash flow hedge accounting | 1,307 | 2,076 | 1,862
Net foreign exchange exposure | (2,539) | (1,476) | (1,726)
Perpetual bond | 1,000 | 1,000 | 1,000
Net foreign exchange exposure excluding perpetual bond | (1,539) | (476) | (726)

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Investments

Investments totaled R$313 million in 1Q19, moving up 40% over 1Q18, due to investments related to scheduled stoppage of blast furnace number 3 in the steel segment and the tailings filtering plants in the mining segment, which will enable efficiency gains in steel production and 100% processing of the production without the need to use dams in the end of 2019.

Investments (R$ million) | 1Q18 | 4Q18 | 1Q19 | 2017 | 2018
Steel | 65 | 271 | 160 | 481 | 637
Mining | 116 | 174 | 118 | 378 | 505
Cement | 23 | 30 | 14 | 118 | 79
Logistics | 18 | 26 | 17 | 76 | 84
Other | 2 | 5 | 4 | 12 | 12
Total investments - IFRS | 223 | 507 | 313 | 1,065 | 1,319

Working capital

To calculate working capital, CSN adjusts its assets and liabilities as shown below:

· Accounts receivable: excludes dividends receivable, advances to employees and other receivables;

· Inventories: includes estimated losses and excludes spare parts, which are not part of the cash conversion cycle, and will later be booked under property, plant and equipment;

· Prepaid taxes: composed only of the portion of income tax and social contribution included in recoverable taxes;

· Taxes payable: composed of taxes payable under current liabilities plus taxes in installments;

· Advances from customers: sub-account of other liabilities recorded under current liabilities; and

· Suppliers: Includes Drawee Risk

Accordingly, working capital invested in the business totaled R$3,344 million in 1Q19, an increase of R$967MM in relation to 4Q18, due to temporary increases in inventories and accounts receivable. Specifically, Blast Furnace #3 shutdown increased the slab inventory in anticipation of the period of lower production, while the growth in accounts receivable was due to iron ore sales concentrated at the end of the period, aiming to obtain better realized prices.

Working Capital (R$ million) | 1Q18 | 4Q18 | 1Q19 |  | Change
| 1Q19 | x | 1Q18 | 1Q19 | x | 4Q18
Assets | 6,252 | 6,480 | 7,797 |  | 1,544 | 1,317
Accounts receivable | 2,146 | 2,078 | 2,835 |  | 689 | 757
Inventories | 4,064 | 4,393 | 4,952 |  | 888 | 559
Prepaid taxes | 42 | 9 | 9 |  | (33) | (0)
Liabilities | 3,869 | 4,103 | 4,452 |  | 584 | 349
Trade payables | 3,253 | 3,445 | 3,529 |  | 276 | 84
Payroll and related taxes | 233 | 248 | 262 |  | 29 | 14
Taxes payable | 288 | 272 | 555 |  | 268 | 283
Advances from customers | 95 | 137 | 106 |  | 11 | (31)
Working capital | 2,383 | 2,377 | 3,344 |  | 961 | 967
Average Term (days) | 1Q18 | 4Q18 | 1Q19 |  | Change
| 1Q19 | x | 1Q18 | 1Q19 | x | 4Q18
Amounts received | 33 | 27 | 37 |  | 4 | 10
Amounts paid | 79 | 78 | 79 |  | - | 1
Inventories | 99 | 99 | 111 |  | 12 | 12
Financial cycle | 53 | 48 | 69 |  | 16 | 21

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Results by Segment

The Company maintains integrated operations in five business segments: Steel, Mining, Logistics, Energy and Cement. The main assets and/or companies comprising each segment are presented below:

Net Revenue by Segment – 1Q19 (R$ million)

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Adjusted EBITDA by Segment – 1Q19 (R$ million)

1Q19 Result | Steel | Mining | Port logistics | Railway logistics | Energy | Cement | Corporate expenses/ elimination | Consolidated
(R$ million) |  |  |  |  |  |  |  |
Net revenue | 3,605 | 2,079 | 52 | 335 | 70 | 120 | (255) | 6,005
Domestic market | 2,567 | 245 | 52 | 335 | 70 | 120 | (629) | 2,760
Foreign market | 1,038 | 1,834 | - | - | - | - | 374 | 3,245
COGS | (3,222) | (870) | (47) | (261) | (61) | (138) | 577 | (4,021)
Gross profit | 383 | 1,209 | 5 | 74 | 9 | (18) | 322 | 1,984
SG&A | (197) | (42) | (9) | (27) | (7) | (21) | (390) | (694)
Depreciation | 157 | 92 | 7 | 92 | 4 | 32 | (79) | 306
Proportionate EBITDA of jointly-owned subsidiaries | - | - | - | - | - | - | 127 | 127
Adjusted EBITDA | 344 | 1,259 | 3 | 138 | 6 | (7) | (19) | 1,724
4Q18 Result | Steel | Mining | Port logistics | Railway logistics | Energy | Cement | Corporate expenses/ elimination | Consolidated
(R$ million) |  |  |  |  |  |  |  |
Net revenue | 3,768 | 1,843 | 72 | 398 | 103 | 145 | (278) | 6,051
Domestic market | 2,718 | 300 | 72 | 398 | 103 | 145 | (768) | 2,969
Foreign market | 1,050 | 1,542 | - | - | - | - | 490 | 3,082
COGS | (3,057) | (1,054) | (48) | (275) | (77) | (149) | 662 | (3,998)
Gross profit | 711 | 789 | 24 | 123 | 26 | (4) | 384 | 2,052
SG&A | (266) | (42) | (9) | (34) | (7) | (31) | (541) | (929)
Depreciation | 150 | 88 | 6 | 66 | 4 | 27 | (56) | 285
Proportionate EBITDA of jointly-owned subsidiaries | - |  | - | - | - | - | 153 | 153
Adjusted EBITDA | 594 | 835 | 21 | 156 | 23 | (8) | (60) | 1,560
1Q18 Result | Steel | Mining | Port logistics | Railway logistics | Energy | Cement | Corporate expenses/ elimination | Consolidated
(R$ million) |  |  |  |  |  |  |  |
Net revenue | 3,674 | 1,152 | 66 | 331 | 91 | 131 | (378) | 5,066
Domestic market | 2,291 | 219 | 66 | 331 | 91 | 131 | (612) | 2,515
Foreign market | 1,384 | 933 | - | - | - | - | 234 | 2,551
COGS | (2,900) | (795) | (46) | (244) | (66) | (125) | 493 | (3,685)
Gross profit | 774 | 356 | 20 | 87 | 24 | 5 | 115 | 1,381
SG&A | (234) | (21) | (10) | (23) | (7) | (20) | (249) | (564)
Depreciation | 150 | 106 | 4 | 65 | 4 | 27 | (51) | 305
Proportionate EBITDA of jointly-owned subsidiaries | - | - | - | - | - | - | 119 | 119
Adjusted EBITDA | 690 | 442 | 14 | 128 | 22 | 12 | (66) | 1,242

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CSN’s Steel Results

According to the World Steel Association (WSA), global crude steel production totaled 444.1 million tons (Mton) in 1Q19, 4.5% more than in 1Q18. Asia produced 312.9 Mton in 1Q19, 7.0% more than in 1Q18, while output in the European Union fell 2.0% and production in North America declined 4.0% in the same period.

According to the Brazilian Steel Institute (IABr), domestic sales totaled 2.8 million tons in the first two months of 2019, down 0.7% less from the same period last year. Apparent consumption reached 3.2 million tons in the same period, a 1.2% year-on-year decline. Brazilian crude steel production reached 5.6 million tons, a 0.5% increase over the first two months of 2018.

· CSN’s slab production reached 830,000 tons in 1Q19, down 18% from 4Q18, due to higher maintenance shutdowns associated with the end of the Blast Furnace #3 campaign, and other reforms scheduled for the next quarter. In this period, CSN acquired 200,000 tons of slabs from third parties to maintain production of rolled products stable in 1Q19.

Steel Production | 1Q18 | 4Q18 | 1Q19 | Change
(in thousands of tons) | 1Q19 | x | 1Q18 | 1Q19 | x | 4Q18
Total slabs (UPV - President Vargas Steelwork + third parties) | 1,050 | 1,021 | 1,030 | (2%) | 1%
Slab production | 1,050 | 1,013 | 830 | (21%) | (18%)
Third-party slabs | - | 8 | 200 | - | 2,339%
Total flat rolled products | 978 | 927 | 927 | (5%) | (0%)
Total long rolled products | 40 | 53 | 51 | 28% | (3%)

· In 1Q19, total sales reached 1,175,000 tons, in line with 4Q18, due to the delay in the economic recovery observed in the first months of the year.

Sales Volume - Steel

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· | In 1Q19, CSN’s domestic steel sales came to 811,000 tons, 3% lower than in 4Q18, due to seasonality. According to the National Institute of Steel Distributors (INDA), distribution purchases increased 1.2% in 1Q19 over 1Q18. Imports closed 1Q19 at 305,900 tons, up 1.1% over 1Q18. |
· | Foreign steel sales amounted to 364,000 tons in 1Q19, up 5% over 4Q18, and the comparison as 1Q18 is impaired by the sale of the plant in Terra Haute. In this period, 24,000 tons were exported directly and 340,000 tons were sold by foreign subsidiaries, of which 30,000 tons by LLC, 226,000 tons by SWT and 84,000 tons by Lusosider. |

· | In 1Q19, CSN maintained a high share of coated products as a percentage of total sales volume, following the strategy of adding more value to its product mix. Sales of coated products, such as galvanized items and tin plates, accounted for 48% of flat steel sales, considering all the markets in which the Company operates. In the foreign market, the share of coated products in flat steel sales remained stable at 89% in 1Q19.

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According to ANFAVEA (National Association of Automobile Manufacturers), the production of automobiles, light commercial vehicles, trucks and buses reached 695,730,000 units in the first quarter of 2019, a decline of 0.58% from 1Q18 and an increase of 1.50% over 4Q18. Exports showed a weaker performance, with 104,562,000 vehicles sold, a decrease of 42% versus 1Q18. Anfavea expects vehicle production to grow 9.0%, to 3.14 million units, in 2019. According to ABRAMAT (the Construction Material Manufacturers’ Association), sales of building materials grew 2.9% in March 2019 over the same month in 2018. The association maintains its expectation that sales of building materials will grow 2.0% in 2019. According to IBGE (Brazilian Institute of Geography and Statistics), home appliance production moved up 1.5% in the twelve months ended February 2019 compared to the same period last year. |

· | Net revenue from steel operations reached R$3,605 million in 1Q19, 4% lower than in 4Q18. This was due to the reflection of seasonality, as well as the delay in economic recovery. In the domestic market, average steel prices fell 3% compared to the previous quarter.

· | In 1Q19, the cost of goods sold increased 5.3% over 4Q18, to R$3,222 million, mainly due to lower productivity of blast furnace number 3. |
· | Slab production cost reached R$2,061/t in 1Q19, 14% higher than in 4Q18, fueled by higher spending on iron ore, driven by a sharp price increase and the scheduled stoppage of blast furnace number 3, which reduced slab production.

· | Adjusted EBITDA totaled R$344 million in 1Q19, 41% lower than in 4Q18, driving the EBITDA margin to 9.5% in 1Q19. The efficiency gains expected after the scheduled stoppage of blast furnace number 3 should be felt partially as of 3Q19 and fully as of 4Q19, taking the profitability of the business unit to its historical standard.

CSN’s Mining Results

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In 1Q19, there was a significant reduction in the transoceanic supply of iron ore, addition to the maintenance of the strong growth of the Chinese economy and robust demand in the infrastructure and civil construction sectors had a positive impact on steel production, reflecting higher raw material prices. In this context, the commodity's price averaged US$82.70/dmt (Platts, Fe62%, N. China) in 1Q19, up 15.5% over the previous quarter.

In regard to maritime freight, the BCI-C3 (Tubarão-Qingdao) route recorded an average of US$13.94/wmt in 1Q19, a decline of 24% compared to the prior quarter mainly driven by lower demand for ships in the period, as a result of a reduction in the supply of ore.

· In 1Q19, CSN’s iron ore production totaled 8.2 million tons, up 34% higher year on year, due to the removal of bottlenecks from the start of filtration operations. Iron ore purchases reached 1,530,000 tons in 1Q19, up 3% over 1Q18.

· CSN sold 8.9 million tons of iron ore in 1Q19, 19% more than in 1Q18, with 1.2 million tons sold to the Presidente Vargas Steelworks and the remaining volume sold in Asia and Europe.

Mining Production Volume and Sales | 1Q18 | 4Q18 | 1Q19 | Change
(in thousands of tons) | 1Q19 | x | 1Q18 |  | 1Q19 | x | 4Q18
Iron ore production | 6,129 | 7,382 | 8,190 | 34% |  | 11%
Iron ore purchased from third parties | 1,487 | 2,478 | 1,530 | 3% |  | (38%)
Total production + purchases | 7,616 | 9,860 | 9,719 | 28% |  | (1%)
Sales to UPV | 1,309 | 1,366 | 1,169 | (11%) |  | (14%)
Volume sold to third parties | 6,165 | 8,523 | 7,690 | 25% |  | (10%)
Total sales | 7,474 | 9,889 | 8,859 | 19% |  | (10%)

Production and sales volumes include our 100% stake in CSN Mineração.

· In 1Q19, net revenue from mining reached R$2,079 million, 13% higher than in the previous quarter, fueled by a 12% upturn in realized prices. The Platts 62 index reached US$82.70/dmt, up 16% in the quarter, while the CIF + FOB realized price stood at US$70.6/wmt, up 12% over the previous period.

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· The cost of goods soldin the Mining segment came to R$870 million in 1Q19, down 17% from 4Q18, due to an increase in iron ore production and a decline in purchases of ore from third parties.

· The EBITDA margin reached 61% in 1Q19, up 15.2p.p. over 4Q18, while EBITDA came to R$1,259 million in 1Q19, up 51% over 4Q18, due to the higher price, the higher proportion of own production and lower costs, leading to a substantial increase in EBITDA/ton.

CSN’s Logistics Results

Railway Logistics: Net revenue stood at R$335 million in 1Q19, generating EBITDA of R$138 million, accompanied by an EBITDA margin of 41%.

Port Logistics: Sepetiba Tecon shipped 162,000 tons of steel products and 1,000 tons of general cargo, in addition to handling around 43,000 containers and 56,000 tons of bulk cargo in 1Q19. Net revenue reached R$52 million, generating EBITDA of R$3 million, with an EBITDA margin of 6%.

Sepetiba TECON Highlights | 1Q18 | 4Q18 | 1Q19 | Change
1Q19 | x | 1Q18 | 1Q19 | x | 4Q18
Container volume (thousand units) | 65 | 63 | 43 | (33%) | (32%)
Steel volume (thousand tons) | 219 | 162 | 162 | (26%) | 0%
General cargo volume (thousand tons) | 31 | 19 | 1 | (98%) | (96%)
Bulk volume (thousand tons) |  |  | 56 | - | -

CSN’s Energy Results

According to EPE (Energy Research Company), electricity consumption in Brazil increased 4.6% in February 2019 compared to the same month last year. Electricity consumption fell 2.1% in the industrial segment, but grew a substantial 9.2% and 7.2%, respectively, in the residential and commercial segments.

In 1Q19, net revenue from energy operations totaled R$70 million, EBITDA stood at R$6 million and the EBITDA margin was 9%.

CSN’s Cement Results

In the first three months of 2019, domestic cement sales totaled 12.7 million, according to preliminary date of SNIC (National Cement Industry Association). This amount represents a 1.3% increase over the same period in 2018. Also according to SNIC (National Cement Industry Association), the 1Q19 sales result was slightly above estimates, supporting an optimistic scenario with projected growth of 3% for 2019.

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In 1Q19, CSN’s cement sales declined 7% compared to the same quarter in 2018. Net revenue totaled R$120 million and EBITDA was negative by R$7 million, due to reduced sales volume and lower dilution of fixed costs.

Capital Market

CSN’s shares appreciated 76.44% in 1Q19, while the IBOVESPA moved up 11.78%. Daily traded volume (CSNA3) on B3 averaged R$192 million. On the New York Stock Exchange (NYSE), CSN’s American Depositary Receipts (ADRs) appreciated 69.14%, while the Dow Jones climbed 11.06%. On the NYSE, daily traded volume of CSN’s ADRs (SID) averaged US$15.4 million.

4Q18 | 1Q19
Number of shares (in thousands) | 1,387,524 | 1,387,524
Market cap |  |
Closing price (R$/share) | 8.84 | 16.25
Closing price (US$/ADR) | 2.23 | 4.11
Market cap (R$ million) | 12,265 | 20,841
Market cap (US$ million) | 3,094 | 5,314
Total return including dividends and interest on equity |  |
CSNA3 | (5.05%) | 76.44%
SID | (2.19%) | 69.14%
Ibovespa | 11.78% | 4.84%
Dow Jones | (13.47%) | 11.06%
Volume |  |
Daily average (thousand shares) | 8,042 | 15,184
Daily average (R$ thousand) | 74,976 | 191,925
Daily average (thousand ADRs) | 1,958 | 4,473
Daily average (US$ thousand) | 4,764 | 15,417
Source: Bloomberg |  |

CONSOLIDATED SALES VOLUME (in thousands of tons)

| 1Q18 | 4Q18 | 1Q19 |  | Change
|  | 1Q19 | x | 1Q18 |  | 1Q19 | x | 4Q18
Flat steel | 737 | 791 | 760 |  | 23 |  | (31)
Slab | - | (0) | - |  | - |  | -
Hot rolled | 271 | 284 | 293 |  | 22 |  | 9
Cold rolled | 157 | 159 | 155 |  | (2) |  | (4)
Galvanized | 242 | 279 | 244 |  | 2 |  | (35)
Tin plates | 67 | 69 | 68 |  | 1 |  | (1)
UPV long steel | 45 | 44 | 51 |  | 6 |  | 7
DOMESTIC MARKET | 782 | 835 | 811 |  | 29 |  | (24)
| 1Q18 | 4Q18 | 1Q19 |  | 1Q19 | x | 1Q18 |  | 1Q19 | x | 4Q18
Flat steel | 280 | 152 | 137 |  | (143) |  | (15)
Hot rolled | 35 | 12 | 10 |  | (25) |  | (2)
Cold rolled | 17 | 7 | 6 |  | (11) |  | (1)
Galvanized | 191 | 89 | 96 |  | (95) |  | 7
Tin plates | 37 | 44 | 26 |  | (11) |  | (18)
Long steel (profiles) | 216 | 193 | 226 |  | 10 |  | 33
FOREIGN MARKET | 496 | 345 | 364 |  | (132) |  | 19
| 1Q18 | 4Q18 | 1Q19 |  | 1Q19 | x | 1Q18 |  | 1Q19 | x | 4Q18
Flat steel | 1,017 | 943 | 897 |  | (120) |  | (46)
Slab | - | (0) | - |  | - |  | -
Hot rolled | 306 | 295 | 303 |  | (3) |  | 8
Cold rolled | 174 | 166 | 161 |  | (13) |  | (5)
Galvanized | 433 | 368 | 340 |  | (93) |  | (28)
Tin plates | 104 | 113 | 94 |  | (10) |  | (19)
UPV long steel | 45 | 44 | 51 |  | 6 |  | 7
Long steel (profiles) | 216 | 193 | 226 |  | 10 |  | 33
TOTAL MARKET | 1,277 | 1,181 | 1,175 |  | (102) |  | (6)

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(Expressed in thousands of reais – R$, unless otherwise stated)

1. DESCRIPTION OF BUSINESS

Companhia Siderúrgica Nacional (“CSN”), also referred to as the Company or Parent Company, is a publicly-held company incorporated on April 9, 1941, under the laws of the Federative Republic of Brazil (Companhia Siderúrgica Nacional, its subsidiaries, joint ventures, joint operations and associates are collectively referred to herein as the "Group”). The Company’s registered office is located in São Paulo, SP, Brazil.

CSN is listed on the São Paulo Stock Exchange (B3 S.A. - Brasil, Bolsa, Balcão) and on the New York Stock Exchange (NYSE). Accordingly, the Company reports its information to the Brazilian Securities and Exchange Commission (CVM) and the U.S. Securities and Exchange Commission (SEC).

The Group's main operating activities are divided into five (5) segments as follows:

· Steel:

The Company’s main industrial facility is the Presidente Vargas steelworks (“UPV”), located in the city of Volta Redonda, State of Rio de Janeiro. This segment consolidates all operations related to the production, distribution and sale of flat steel, long steel, metallic containers and galvanized steel. In addition to the facilities in Brazil, CSN has commercial operations in the United States and operations in Portugal and Germany aimed at gaining markets and providing excellent services to end consumers. Its steel is used in home appliances, civil construction and automobile industries.

· Mining:

The production of iron ore is developed in the city of Congonhas, State of Minas Gerais, by subsidiary CSN Mineração.

Iron ore is sold basically in the international market, especially in Europe and Asia. The prices charged in these markets are historically cyclical and subject to significant fluctuations over short periods of time, driven by several factors related to global demand, strategies adopted by the major steel producers, and the foreign exchange rate. All these factors are beyond the Company’s control. The ore transportation is carried out through Terminal de Carvão e Minérios do Porto de Itaguaí – (“TECAR”), a solid bulk terminal, one of the four terminals that comprise the Itaguaí Port, in the state of Rio de Janeiro. Imports of coal and coke are also carried out through this terminal by providing services to CSN’s steel segment. The Company´s mining activities also comprise exploitation of tin in the State of Rondônia, to supply the needs of the UPV. The surplus of these raw materials is sold to subsidiaries and third parties.

The Company's mining activities utilize tailings dams for which all appropriate measures are taken to mitigate the risks inherent to the handling and disposal of the tailings and to comply with current environmental legislation. It is important to reiterate that operating without dependence on these dams is a priority in our mining activities, for which investments of around R$ 250 million in dry stacking technology have already been made. In this context, it is expected that CSN Mineração will be fully processing the tailings in the dry process by the end of 2019, subject to revision of projects and expected deadlines, proper operation of equipment and unforeseen delays. As a consequence of these measures, decommissioning of dams is the natural way of processing dry tailings.

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All of our dams, both mining and hydroelectric dams, are positively certified and comply with the environmental legislation in force.

· Cement:

CSN entered in the cement market boosted by the synergy between this new activity and its existing businesses. Next to the UPV in Volta Redonda (RJ) is installed the new business unit CSN Cimentos, which produces CP-III type of cement by using slag produced by the UPV blast furnaces in Volta Redonda. It also explores limestone and dolomite at the Arcos unit, located in the State of Minas Gerais, to satisfy the needs of UPV and the cement plant. Additionally, the operation clinker production line is located in Arcos/MG. As a result, the Company is self-sufficient in the production of cement, with an installed capacity of 4.7 million tons per year.

· Logistics

Railroads:

CSN has interests in three railroad companies: MRS Logística S.A., which manages the Southeast Railway System of the former Rede Ferroviária Federal S.A. (“RFFSA”), Transnordestina Logística S.A. (“TLSA”) and FTL - Ferrovia Transnordestina Logística S.A. (“FTL”), which has the concession to operate the former Northeast Railway System of RFFSA, in the States of Maranhão, Piauí, Ceará, Rio Grande do Norte, Paraíba, Pernambuco and Alagoas, with TLSA being responsible for the rail links of Missão Velha-Salgueiro, Salgueiro-Trindade, Trindade-Eliseu Martins, Salgueiro-Porto de Suape and Missão Velha-Porto de Pecém (Railway System II), still under construction and FTL being responsible for the rail links of São Luiz-Mucuripe, Arrojado-Recife, Itabaiana-Cabedelo, Paula Cavalcante-Macau and Propriá-Jorge Lins (Railway System I).

Ports:

The Company operates in the State of Rio de Janeiro, through its subsidiary Sepetiba Tecon S.A., the Container Terminal (“TECON”) and through its subsidiary CSN Mineração S.A.(“CSN Mineração”), TECAR, both at the Itaguaí Port. Locate in the Bay of Sepetiba, they have privileged highway, railroad and maritime access.

At TECON, shipment of CSN´s steel products, movement of containers, storage, consolidation and deconsolidation of cargo are carried out and, at TECAR, the shipment of iron ore to overseas market and the unloading of coal and other products, such as petroleum coke, sulfur and zinc concentrate for our own use and for several customers.

· Energy:

As energy is fundamental to its production process, the Company has electric energy generation assets to guarantee its self-sufficiency.

Note 25 - “Segment Information” details the financial information per CSN´s business segment.

· Going Concern

The interim financial information was prepared based on the normal continuity of its business.

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The negotiations are in constant progress for reprofiling part of the debts do not jeopardize the Company's operating continuity and Management does not have any other relevant operational restructuring plan that implies a change to the conclusion of the operational continuity. Further disclosures on the bases for evaluating the operational continuity were made in the disclosures of this subject included in the financial statements of December 31, 2018, approved by Management on february 20, 2019.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2.a) Basis of preparation and declaration of conformity

The consolidated and parent company condensed interim financial information (“condensed quarterly information”) have been prepared and are being presented in accordance with accounting practices adopted in Brazil based on the provisions of the Brazilian Corporate Law, pronouncements, guidelines and interpretations issued (CPC), approved by CVM, besides the own standards issued by the Brazilian Securities and Exchange Commission (“CVM”) and International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standard Board (IASB) and highlight all the relevant information of the interim financial statements, and only this information, is being disclosed and corresponds to the information used by the Company's management in its activities

The condensed interim financial information has been prepared and is being presented in accordance with CPC 21 (R1) - “Interim Financial Reporting” and IAS 34 - “Interim Financial Reporting”, consistently with the standards issued by the CVM.

The significant accounting policies applied in this condensed interim financial information are consistent with the policies described in Note 02 to the Company’s financial statements for the year ended December 31, 2018, filed with CVM.

This condensed interim financial information does not include all requirements of annual or full financial statements and, accordingly, should be read in conjunction with the Company’s financial statements for the year ended December 31, 2018.

Therefore, in this condensed interim financial information the following notes are not repeated, either due to redundancy or to the materiality in relation to those already presented in the annual financial statements:

Note 02 – Summary of significant accounting policies

Note 09 - Investments

Note 16 - Taxes in installments

Note 17 - Provision for tax, social security, labor, civil and environmental risks and judicial deposits

Note 27 – Employee benefits

Note 28 – Commitments

The parent company and consolidated condensed interim financial information was approved by Management on May 8, 2019.

2.b) Basis of presentation

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The consolidated condensed interim financial information is presented in thousands of reais (R$), which is the Company’s principal functional currency and the Group’s presentation currency.

Transactions in foreign currencies are translated into the functional currency using the exchange rates in effect at the dates of the transactions or valuations when items are remeasured. The asset and liability balances are translated at the exchange rates prevailing at the end of the reporting period. As of March 31, 2019, US$1 is equivalent to R$3.8967 (R$3.8748 as of December 31, 2018) and €1 is equivalent to R$4.3760 (R$4.4390 as of December 31, 2018), according to the rates obtained from the Central Bank of Brazil website.

2.c) Basis of consolidation

The accounting policies have been consistently applied to all consolidated companies. The consolidated financial statements for the period ended March 31, 2019 and year ended December 31, 2018 include the following direct and indirect subsidiaries and joint ventures, as well as the exclusive funds, as described below:

· Companies

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|  | Equity interests (%) |
Companies |  | 03/31/2019 |  | 12/31/2018 |  | Core business
Direct interest in subsidiaries: full consolidation |  |  |  |  |  |
CSN Islands VII Corp. |  | 100.00 |  | 100.00 |  | Financial transactions
CSN Islands XI Corp. |  | 100.00 |  | 100.00 |  | Financial transactions
CSN Islands XII Corp. |  | 100.00 |  | 100.00 |  | Financial transactions
CSN Steel S.L.U. |  | 100.00 |  | 100.00 |  | Equity interests and Financial transactions
TdBB S.A (*) |  | 100.00 |  | 100.00 |  | Equity interests
Sepetiba Tecon S.A. |  | 99.99 |  | 99.99 |  | Port services
Minérios Nacional S.A. |  | 99.99 |  | 99.99 |  | Mining and Equity interests
Companhia Florestal do Brasil |  | 99.99 |  | 99.99 |  | Reforestation
Estanho de Rondônia S.A. |  | 99.99 |  | 99.99 |  | Tin Mining
Companhia Metalúrgica Prada |  | 99.99 |  | 99.99 |  | Manufacture of containers and distribution of steel products
CSN Gestão de Recursos Financeiros Ltda. (*) |  | 99.99 |  | 99.99 |  | Management of funds and securities portfolio
CSN Mineração S.A. |  | 87.52 |  | 87.52 |  | Mining and Equity interests
CSN Energia S.A. |  | 99.99 |  | 99.99 |  | Sale of electric power
FTL - Ferrovia Transnordestina Logística S.A. |  | 91.69 |  | 91.69 |  | Railroad logistics
Nordeste Logística S.A. |  | 99.99 |  | 99.99 |  | Port services
Aceros México CSN (1) |  | - |  | 0.08 |  | Commercial representation, steel sales and related activities
CSN Inova Ltd. |  | 100.00 |  | 100.00 |  | Advisory and implementation of new development projects
Indirect interest in subsidiaries: full consolidation |  |  |  |  |  |
Lusosider Projectos Siderúrgicos S.A. |  | 100.00 |  | 100.00 |  | Equity interests and product sales
Lusosider Aços Planos, S. A. |  | 99.99 |  | 99.99 |  | Steel and Equity interests
CSN Resources S.A. |  | 100.00 |  | 100.00 |  | Financial transactions and Equity interests
Companhia Brasileira de Latas |  | 99.99 |  | 99.99 |  | Sale of cans and containers in general and Equity interests
Companhia de Embalagens Metálicas MMSA |  | 99.67 |  | 99.67 |  | Production and sale of cans and related activities
Companhia de Embalagens Metálicas - MTM |  | 99.67 |  | 99.67 |  | Production and sale of cans and related activities
CSN Steel Holdings 1, S.L.U. |  | 100.00 |  | 100.00 |  | Financial transactions, product sales and Equity interests
CSN Productos Siderúrgicos S.L. |  | 100.00 |  | 100.00 |  | Financial transactions, product sales and Equity interests
Stalhwerk Thüringen GmbH |  | 100.00 |  | 100.00 |  | Production and sale of long steel and related activities
CSN Steel Sections UK Limited (*) |  | 100.00 |  | 100.00 |  | Sale of long steel
CSN Steel Sections Polska Sp.Z.o.o |  | 100.00 |  | 100.00 |  | Financial transactions, product sales and Equity interests
CSN Asia Limited |  | 100.00 |  | 100.00 |  | Commercial representation
CSN Mining Holding, S.L |  | 87.52 |  | 87.52 |  | Financial transactions, product sales and Equity interests
CSN Mining GmbH |  | 87.52 |  | 87.52 |  | Financial transactions, product sales and Equity interests
CSN Mining Asia Limited |  | 87.52 |  | 87.52 |  | Commercial representation
Aceros México CSN (1) |  | - |  | 99.92 |  | Commercial representation, steel sales and related activities
Lusosider Ibérica S.A. |  | 100.00 |  | 100.00 |  | Steel, commercial and industrial activities and equity interests
CSN Mining Portugal, Unipessoal Lda |  | 87.52 |  | 87.52 |  | Commercial and representation of products
Companhia Siderurgica Nacional, LLC |  | 100.00 |  | 100.00 |  | Import and distribution /resale of products
Direct interest in joint operations: proportionate consolidation |  |  |  |  |  |
Itá Energética S.A. |  | 48.75 |  | 48.75 |  | Electric power generation
Consórcio da Usina Hidrelétrica de Igarapava |  | 17.92 |  | 17.92 |  | Electric power consortium
Direct interest in joint ventures: equity method |  |  |  |  |  |
MRS Logística S.A. |  | 18.64 |  | 18.64 |  | Railroad transportation
Aceros Del Orinoco S.A. |  | 31.82 |  | 31.82 |  | Dormant company
CBSI - Companhia Brasileira de Serviços de Infraestrutura |  | 50.00 |  | 50.00 |  | Equity interests and product sales and iron ore
Transnordestina Logística S.A. |  | 46.30 |  | 46.30 |  | Railroad logistics
Indirect interest in joint ventures: equity method |  |  |  |  |  |
MRS Logística S.A. |  | 16.30 |  | 16.30 |  | Railroad transportation
Direct interest in associates: equity method |  |  |  |  |  |
Arvedi Metalfer do Brasil S.A. |  | 20.00 |  | 20.00 |  | Metallurgy and Equity interests

(*) Dormant companies, therefore, they are presented in note 9.a., where information on companies accounted for under the equity method and fair value through profit or loss and comprehensive income is disclosed;

· Events in 2018

1. Transfer of 1% stake in Aceros Mexico CSN from CSN Steel to Companhia Siderúrgica Nacional occurred on February 1, 2018. On September 18, 2018, CSN Steel increased the capital of Aceros Mexico CSN, diluting the direct interest of Companhia Siderúrgica Nacional to 0.08%, with CSN Steel holding 99.92%. On February 1, 2019, the Federal Taxpayers' Registry was canceled and, therefore, the settlement process of Aceros Mexico CSN was terminated, however, before third parties and for the purposes of commercial law, the settlement was retroactive to September 18, 2018;

· Exclusive funds

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|  | Equity interests (%) |
Exclusive funds |  | 03/31/2019 |  | 12/31/2018 |  | Core business
Direct interest: full consolidation |  |  |  |  |  |
Diplic II - Private credit balanced mutual fund |  | 100.00 |  | 100.00 |  | Investment fund
Caixa Vértice - Private credit balanced mutual fund |  | 100.00 |  | 100.00 |  | Investment fund
VR1 - Private credit balanced mutual fund |  | 100.00 |  | 100.00 |  | Investment fund

3. ADOPTION OF NEW ACCOUNTING PRACTICES

· IFRS 16/CPC 06(R2) - Leases

The Company applied as of January 1, 2019, IFRS 16/CPC 06 (R2) – Leases.

As a result, the Company started to recognize in its financial statements the right to use the assets and liabilities of lease arrangements.

The Company opted to apply the modified retrospective approach, recognizing the cumulative effect as an adjustment in the opening balance. For existing contracts on the date of the initial adoption, the right to use was recognized for the amount equal to the lease liability, which was measured at the present value of the future fixed obligations provided for in the contract.

The company applied the exemption provided for in the standard for the non-recognize of the right of use and lease liability for contract with a term of not more than twelve months and that has a low value.

The present value of the lease liabilities was calculated using the interest rate implicit in the contracts and in and in its absence, the Company chose to use the average rate of fundraising.

The effects of the recognition of the standard can be observed in notes 10 and 14.a.

4. CASH AND CASH EQUIVALENTS

| Consolidated |  | Parent Company
| 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Current |  |  |  |  |  |  |
Cash and cash equivalents |  |  |  |  |  |  |
Cash and banks | 413,573 |  | 1,124,714 |  | 27,660 |  | 37,323
Short-term investments |  |  |  |  |  |  |
In Brazil: |  |  |  |  |  |  |
Government securities | 637 |  | 10,247 |  | 137 |  | 477
Private securities | 2,140,113 |  | 609,480 |  | 175,473 |  | 410,036
| 2,140,750 |  | 619,727 |  | 175,610 |  | 410,513
Abroad: |  |  |  |  |  |  |
Time deposits | 147,754 |  | 503,563 |  | 90,716 |  | 92,017
Total short-term investments | 2,288,504 |  | 1,123,290 |  | 266,326 |  | 502,530
Cash and cash equivalents | 2,702,077 |  | 2,248,004 |  | 293,986 |  | 539,853

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The funds available established in Brazil, are basically invested in repurchase agreements and Bank Certificate of Deposit (“CDBs”) and yield interest based on the floating of Certificates of Interbank Deposits (“CDI”) and government securities are basically repurchase agreements backed by National Treasury Notes. The funds are managed by BNY Mellon Serviços Financeiros DTVM S.A. and Caixa Econômica Federal (CEF). The Company invests part of the resources through the investments considered exclusive, and their financial statements were consolidated into the Company’s statements. The funds are managed by BNY Mellon Serviços Financeiros DTVM S.A. and Caixa Econômica Federal (CEF).

A significant part of the funds of the Company and its foreign subsidiaries is invested in time deposits in top rated banks abroad and the returns are based on fixed interest rates.

5. FINANCIAL INVESTMENTS

|  |  |  | Consolidated |  | Parent Company
|  | Current |  | Non-Current |  | Current
|  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
CDB - Certificate of bank deposit (1) |  | 774,095 |  | 882,376 |  |  |  |  |  | 774,095 |  | 882,376
Government securities (2) |  | 4,513 |  | 13,337 |  |  |  |  |  | 973 |  | 621
Time Deposit (3) |  |  |  |  |  | 7,829 |  | 7,772 |  |  |  |
|  | 778,608 |  | 895,713 |  | 7,829 |  | 7,772 |  | 775,068 |  | 882,997

1. Financial investment linked to Bank Certificate of Deposit to secure a letter of guarantee.

2. Investments in National Treasury Bills (LFT) managed by its exclusive funds.

3. Investments in Time Deposit in custody to cover additional expenses of the sale of LLC.

6. TRADE RECEIVABLES

|  |  | Consolidated |  |  |  | Parent Company
| 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Trade receivables |  |  |  |  |  |  |
Third parties |  |  |  |  |  |  |
Domestic market | 1,427,314 |  | 1,369,396 |  | 1,115,355 |  | 1,094,323
Foreign market | 1,439,153 |  | 852,821 |  | 93,425 |  | 141,484
| 2,866,467 |  | 2,222,217 |  | 1,208,780 |  | 1,235,807
Allowance for doubtful debts | (216,671) |  | (237,352) |  | (155,263) |  | (176,855)
| 2,649,796 |  | 1,984,865 |  | 1,053,517 |  | 1,058,952
Related parties (Note 18 a) | 185,600 |  | 93,317 |  | 1,182,272 |  | 906,865
| 2,835,396 |  | 2,078,182 |  | 2,235,789 |  | 1,965,817

In accordance with the internal sales policy the Group carries out transactions of assignment of receivables without co-obligation in which, after assigning the customer’s trade notes/bills and receiving the amounts from each transaction closed, CSN settles the receivables and becomes entirely free from the credit risk of the transaction. In March 31, 2019, this transaction in the consolidated totals R$33,701 (R$ 46,210 as of December 31, 2018) and in the Parent Company R$28,650 (R$40,849 as of December 31, 2018).

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The gross balance of receivables from third parties is comprised as follows:

|  | Consolidated |  | Parent Company
|  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Current |  | 2,242,463 |  | 1,514,847 |  | 728,508 |  | 758,433
Past-due up to 30 days |  | 106,027 |  | 177,287 |  | 29,863 |  | 48,705
Past-due up to 180 days |  | 15,037 |  | 47,684 |  | 10,180 |  | 8,361
Past-due over 180 days |  | 502,940 |  | 482,399 |  | 440,229 |  | 420,308
|  | 2,866,467 |  | 2,222,217 |  | 1,208,780 |  | 1,235,807

The movements in the Company’s allowance for doubtful debts are as follows:

|  |  |  | Consolidated |  |  |  | Parent Company
|  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Opening balance |  | (237,352) |  | (191,979) |  | (176,855) |  | (140,392)
Estimated losses |  | (4,453) |  | (53,706) |  | (3,511) |  | (39,042)
Recovery of receivables |  | 25,134 |  | 8,333 |  | 25,103 |  | 2,579
Closing balance |  | (216,671) |  | (237,352) |  | (155,263) |  | (176,855)

7. INVENTORIES

|  |  | Consolidated |  |  |  | Parent Company
| 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Finished goods | 1,598,028 |  | 1,362,981 |  | 1,110,728 |  | 951,529
Work in progress | 1,286,810 |  | 1,122,933 |  | 1,137,762 |  | 959,414
Raw materials | 1,667,132 |  | 1,560,499 |  | 1,257,638 |  | 1,254,551
Spare parts | 851,283 |  | 856,097 |  | 485,544 |  | 495,385
Iron ore | 358,678 |  | 258,612 |  | 43,411 |  | 18,478
Advances to suppliers | 45,076 |  | 36,192 |  | 42,919 |  | 28,185
(-) Provision for losses | (141,177) |  | (157,754) |  | (43,545) |  | (45,076)
| 5,665,830 |  | 5,039,560 |  | 4,034,457 |  | 3,662,466

The movements in the provision for inventory losses are as follows:

|  |  |  | Consolidated |  | Parent Company
|  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Opening balance |  | (157,754) |  | (135,840) |  | (45,076) |  | (51,968)
Reversal / (losses) for slow-moving and obsolescence |  | 16,577 |  | (21,914) |  | 1,531 |  | 6,892
Closing balance |  | (141,177) |  | (157,754) |  | (43,545) |  | (45,076)

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8. OTHER CURRENT AND NONCURRENT ASSETS

The group of other current and noncurrent assets is comprised as follows:

|  |  |  |  | Consolidated |  |  |  |  |  | Parent Company
| Current | Non-current | Current | Non-current
| 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Judicial deposits (note 16) |  |  |  |  | 359,367 |  | 347,950 |  |  |  |  |  | 267,000 |  | 255,595
Credits with the PGFN (1) |  |  |  |  | 46,774 |  | 46,774 |  |  |  |  |  | 46,774 |  | 46,774
Recoverable taxes (2) | 1,457,857 |  | 1,412,335 |  | 1,818,077 |  | 1,822,388 |  | 1,311,098 |  | 1,265,003 |  | 1,700,521 |  | 1,692,274
Prepaid expenses | 100,603 |  | 49,830 |  | 54,293 |  | 49,808 |  | 65,151 |  | 25,716 |  | 38,248 |  | 34,450
Actuarial asset - related party (note 18 a) |  |  |  |  | 93,757 |  | 99,894 |  |  |  |  |  | 80,598 |  | 85,415
Derivative financial instruments (note 13 I) |  |  | 351 |  |  |  |  |  |  |  |  |  |  |  |
Securities held for trading (note 13 I) | 9,954 |  | 4,503 |  |  |  |  |  | 9,806 |  | 4,352 |  |  |  |
Iron ore inventory (3) |  |  |  |  | 144,499 |  | 144,499 |  |  |  |  |  |  |  |
Northeast Investment Fund – FINOR |  |  |  |  | 26,598 |  | 26,598 |  |  |  |  |  | 26,598 |  | 26,598
Loans with related parties (nota 18 a e 13 I) | 2,710 |  | 2,675 |  | 744,364 |  | 706,605 |  | 23,264 |  | 22,807 |  | 649,967 |  | 588,285
Other receivables from related parties (note 18 a) | 3,202 |  | 3,649 |  | 218,840 |  | 218,840 |  | 15,493 |  | 15,395 |  | 463,182 |  | 458,177
Other receivables (note 13 I) |  |  |  |  | 7,438 |  | 7,451 |  |  |  |  |  | 1,173 |  | 1,213
Eletrobrás compulsory loan (note 13 I) (4) |  |  |  |  | 827,774 |  | 813,428 |  |  |  |  |  | 826,934 |  | 812,803
Dividends receivable (note 18 a) | 48,315 |  | 46,171 |  |  |  |  |  | 261,330 |  | 259,186 |  |  |  |
Employee debt | 45,055 |  | 31,645 |  |  |  |  |  | 31,113 |  | 19,684 |  |  |  |
Sea freight (5) | 89,742 |  | 117,156 |  |  |  |  |  |  |  | 2,357 |  |  |  |
Other receivables | 10,600 |  | 12,753 |  |  |  |  |  | 3,512 |  | 3,055 |  |  |  |
Others | 75,793 |  | 71,956 |  | 915 |  | 988 |  |  |  |  |  | 915 |  | 986
| 1,843,831 |  | 1,753,024 |  | 4,342,696 |  | 4,285,223 |  | 1,720,767 |  | 1,617,555 |  | 4,101,910 |  | 4,002,570

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(1) Refers to the excess of judicial deposit originated by the 2009 REFIS (Tax Debt Refinancing Program).

(2) Refers mainly to PIS / COFINS, ICMS recoverable and income and social contribution taxes to be offset. On September 20, 2018, the writ of mandamus and special appeal filed in 2006, in which CSN and Federal Union were parties, related to the discussion about the non-inclusion of ICMS in the calculation base of PIS and COFINS, confirmed the CSN's right to offset the amounts unduly paid under these taxes from 2001 to 2014.

(3) Long-term iron ore inventories that will be used after the construction of the processing plant, which will produce pellet feed, expected to start operating in the first half of 2020.

(4) This is a fixed amount, certain and due, arising from the res judicata favorable decision to the Company, which is irreversible and irrevocable, to apply the STJ's consolidated position on the subject, which culminated in the conviction of Eletrobrás to the payment of the correct interest and monetary adjustment of the Compulsory Loan. The res judicata decision, as well as the certainty about the amounts involved in the liquidation of the sentence (judicial procedure to request the satisfaction of the right), allowed the conclusion that the entry of this value is certain.

(5) Refers to payment of freight expenses and marine insurance on unrecognized sales revenues, following the guidelines of CPC 47 / IFRS15, the freight in incoterms "CIF" is considered a distinct performance obligation and for these, there’s no conclusion about the delivery process in March 31, 2019, but the transport service provider had already been paid.

9. INVESTMENTS

The information on the activities of subsidiaries, joint ventures, joint operations, associates and other investments did not have any changes in relation to that disclosed in the Company's financial statements as of December 31, 2017 and, accordingly, the Company decided not to repeat it in the condensed interim financial information as of March 31, 2019.

9.a) Direct interests in subsidiaries, joint ventures, joint operations, associates and other investments

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|  |  |  |  |  |  |  |  |  |  |  |  |  |  | 3/31/2019 |  |  |  |  |  |  |  |  |  | 12/31/2018 |  | 3/31/2018
Companies |  | Number of shares held by CSN (in units) |  |  | % Direct equity interest |  | Participação no |  |  |  |  |  |  | % Direct equity interest |  | Participação no |  |  |  |
|  |  |  | Assets |  | Liabilities |  | Shareholders’ equity |  | Fair Value |  | Net income / (loss) for the period |  |  | Assets |  | Liabilities |  | Shareholders’ equity |  | Fair Value |  | Net income / (loss) for the period
Controladas |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
CSN Islands VII Corp. |  | 20,001,000 |  |  | 100.00 |  | 340,985 |  | 2,037,918 |  | (1,696,933) |  |  |  | (47,837) |  | 100.00 |  | 338,645 |  | 1,987,741 |  | (1,649,096) |  |  |  | (106,347)
CSN Islands XI Corp. |  | 50,000 |  |  | 100.00 |  | 2,181,906 |  | 2,309,454 |  | (127,548) |  |  |  | 4,089 |  | 100.00 |  | 2,178,010 |  | 2,309,647 |  | (131,637) |  |  |  | (17,598)
CSN Islands XII Corp. |  | 1,540 |  |  | 100.00 |  | 2,349,827 |  | 3,902,006 |  | (1,552,179) |  |  |  | (74,774) |  | 100.00 |  | 2,402,671 |  | 3,880,076 |  | (1,477,405) |  |  |  | (34,678)
CSN Steel S.L.U. |  | 22,042,688 |  |  | 100.00 |  | 3,638,529 |  | 133,441 |  | 3,505,088 |  |  |  | 340 |  | 100.00 |  | 3,763,095 |  | 242,722 |  | 3,520,373 |  |  |  | 103,286
Sepetiba Tecon S.A. |  | 254,015,052 |  |  | 99.99 |  | 634,264 |  | 321,477 |  | 312,787 |  |  |  | (4,646) |  | 99.99 |  | 480,459 |  | 163,026 |  | 317,433 |  |  |  | 5,281
Minérios Nacional S.A. |  | 141,719,295 |  |  | 99.99 |  | 113,604 |  | 41,366 |  | 72,238 |  |  |  | 566 |  | 99.99 |  | 110,446 |  | 38,774 |  | 71,672 |  |  |  | (94)
Valor Justo - Minérios Nacional |  |  |  |  |  |  |  |  |  |  | 2,123,507 |  |  |  |  |  |  |  |  |  |  |  | 2,123,507 |  |  |  |
Estanho de Rondônia S.A. |  | 121,861,697 |  |  | 99.99 |  | 46,544 |  | 45,910 |  | 634 |  |  |  | (2,340) |  | 99.99 |  | 48,181 |  | 45,207 |  | 2,974 |  |  |  | (570)
Companhia Metalúrgica Prada |  | 445,921,292 |  |  | 99.99 |  | 670,052 |  | 600,398 |  | 69,654 |  |  |  | (15,914) |  | 99.99 |  | 644,954 |  | 559,386 |  | 85,568 |  |  |  | (16,620)
CSN Mineração S.A. |  | 158,419,480 |  |  | 87.52 |  | 14,664,466 |  | 4,968,784 |  | 9,695,682 |  |  |  | 650,527 |  | 87.52 |  | 13,235,705 |  | 4,190,564 |  | 9,045,141 |  |  |  | 105,765
CSN Energia S.A. |  | 43,149 |  |  | 99.99 |  | 129,410 |  | 37,851 |  | 91,559 |  |  |  | (1,307) |  | 99.99 |  | 138,644 |  | 45,778 |  | 92,866 |  |  |  | 9,054
FTL - Ferrovia Transnordestina Logística S.A. |  | 442,672,357 |  |  | 91.69 |  | 432,482 |  | 166,952 |  | 265,530 |  |  |  | (14,873) |  | 91.69 |  | 403,623 |  | 123,220 |  | 280,403 |  |  |  | (8,600)
Companhia Florestal do Brasil |  | 41,923,302 |  |  | 99.99 |  | 34,987 |  | 1,609 |  | 33,378 |  |  |  | (8) |  | 99.99 |  | 34,990 |  | 1,604 |  | 33,386 |  |  |  | (2)
Nordeste Logística |  | 99,999 |  |  | 99.99 |  | 85 |  | 56 |  | 29 |  |  |  |  |  | 99.99 |  | 85 |  | 56 |  | 29 |  |  |  |
|  |  |  |  |  |  | 25,237,141 |  | 14,567,222 |  | 12,793,426 |  |  |  | 493,823 |  |  |  | 23,779,508 |  | 13,587,801 |  | 12,315,214 |  |  |  | 38,877
Joint-venture and Joint-operation |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Itá Energética S.A. |  | 253,606,846 |  |  | 48.75 |  | 259,847 |  | 15,529 |  | 244,318 |  |  |  | 1,771 |  | 48.75 |  | 258,835 |  | 16,288 |  | 242,547 |  |  |  | 2,734
MRS Logística S.A. (*) |  | 63,377,198 | (*) |  | 18.64 |  | 1,849,227 |  | 1,111,208 |  | 738,019 |  |  |  | 21,466 |  | 18.64 |  | 1,563,350 |  | 846,813 |  | 716,537 |  |  |  | 16,481
CBSI - Companhia Brasileira de Serviços de Infraestrutura | 1,876,146 |  |  | 50.00 |  | 25,740 |  | 21,144 |  | 4,596 |  |  |  | 784 |  | 50.00 |  | 25,941 |  | 19,997 |  | 5,944 |  |  |  | 684
Transnordestina Logística S.A. |  | 24,168,304 |  |  | 31.82 |  | 4,117,183 |  | 2,941,487 |  | 1,175,696 |  | 271,116 |  | (6,056) |  | 46.30 |  | 4,065,604 |  | 2,883,851 |  | 1,181,753 |  | 271,116 |  | (2,514)
|  |  |  |  |  |  | 6,251,997 |  | 4,089,368 |  | 2,162,629 |  | 271,116 |  | 17,965 |  |  |  | 5,913,730 |  | 3,766,949 |  | 2,146,781 |  | 271,116 |  | 17,385
Associates |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Arvedi Metalfer do Brasil |  | 46,994,971 |  |  | 20.00 |  | 40,712 |  | 26,308 |  | 14,404 |  |  |  |  |  | 20.00 |  | 40,712 |  | 26,308 |  | 14,404 |  |  |  | 45
|  |  |  |  |  |  | 40,712 |  | 26,308 |  | 14,404 |  |  |  |  |  |  |  | 40,712 |  | 26,308 |  | 14,404 |  |  |  | 45
Classified as fair value through profit or loss and comprehensive income (Note 13 I) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Usiminas |  |  |  |  |  |  |  |  |  |  | 2,364,265 |  |  |  |  |  |  |  |  |  |  |  | 2,250,623 |  |  |  |
Panatlântica |  |  |  |  |  |  |  |  |  |  | 42,958 |  |  |  |  |  |  |  |  |  |  |  | 28,566 |  |  |  |
|  |  |  |  |  |  |  |  |  |  | 2,407,223 |  |  |  |  |  |  |  |  |  |  |  | 2,279,189 |  |  |  |
Other investments |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Lucros nos estoques de controladas |  |  |  |  |  |  |  |  |  | (78,863) |  |  |  | 37,511 |  |  |  |  |  |  |  | (116,375) |  |  |  | (30,428)
Outros |  |  |  |  |  |  |  |  |  |  | 63,539 |  |  |  | 171 |  |  |  |  |  |  |  | 63,538 |  |  |  | (2)
|  |  |  |  |  |  |  |  |  |  | (15,324) |  |  |  | 37,682 |  |  |  |  |  |  |  | (52,837) |  |  |  | (30,430)
Total investments |  |  |  |  |  |  |  |  |  |  | 17,633,474 |  |  |  | 549,470 |  |  |  |  |  |  |  | 16,973,867 |  |  |  | 25,877
Classification of investments in the balance sheet |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Investments in assets |  |  |  |  |  |  |  |  |  |  | 21,010,134 |  |  |  |  |  |  |  |  |  |  |  | 20,232,005 |  |  |  |
Investments with negative equity |  |  |  |  |  |  |  |  |  |  | (3,376,660) |  |  |  |  |  |  |  |  |  |  |  | (3,258,138) |  |  |  |
|  |  |  |  |  |  |  |  |  |  | 17,633,474 |  |  |  |  |  |  |  |  |  |  |  | 16,973,867 |  |  |  |

(*) On March 31, 2019 and December 31, 2018, the Company directly owned 26,611,282 common shares, 2,673,312 Class A preferred shares and 34,092,604 Class B preferred shares, totaling 36,765,916 preferred shares of MRS Logística S.A.;

The number of shares, the balances of assets, liabilities and shareholders’ equity, and the amounts of profit / (loss) for the period refer to the interests held by CSN in those companies.

9.b) Movement in investments in subsidiaries, joint ventures, joint operations, associates and other investments

| Consolidated |  | Parent Company
| 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Opening balance of investments | 5,630,613 |  | 5,499,995 |  | 20,232,005 |  | 22,894,885
Opening balance of loss provisions |  |  |  |  | (3,258,138) |  | (1,366,480)
Capital increase | 380 |  |  |  | 380 |  | 81,594
Dividends (1) | (2,144) |  | (87,846) |  | (2,301) |  | (5,529,277)
Comprehensive income (2) | 31 |  | 272 |  | (15,595) |  | 15,186
Equity in results of affiliated companies (3) | 37,662 |  | 173,145 |  | 549,470 |  | 816,632
Receipt of sale of Usiminas' shares |  |  | (39,377) |  |  |  | (39,377)
Update of shares measured at fair value through profit or loss (VJR) (note 13 II) | 127,653 |  | 96,133 |  | 127,653 |  | 96,133
Amortization of fair value – investment in MRS | (2,937) |  | (11,746) |  |  |  |
Others | 9 |  | 37 |  |  |  | 4,571
Closing balance of investments | 5,791,267 |  | 5,630,613 |  | 21,010,134 |  | 20,232,005
Balance of provision for investments with negative equity |  |  |  |  | (3,376,660) |  | (3,258,138)
Total | 5,791,267 |  | 5,630,613 |  | 17,633,474 |  | 16,973,867

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1. In 2019, refers to the allocation of dividends of joint venture CBSI – Companhia Brasileira de Serviços de Infraestrutura.

2. Refers to the mark-to-market of investments classified fair value through profit or loss and fair value through other comprehensive income, translation to reporting currency of the foreign investment whose functional currency is not the Real, actuarial gain/loss and gain/loss on investment hedge from investments accounted for under the equity method.

3. The reconciliation of the equity in results of joint ventures and associates and the amount recorded in the statement of income are presented below and derive from the elimination of results of CSN's transactions with these companies:

|  |  | Consolidated
| 03/31/2019 |  | 03/31/2018
Equity in results of affiliated companies |  |  |
MRS Logística S.A. | 42,922 |  | 32,954
CBSI - Companhia Brasileira de Serviços de Infraestrutura | 784 |  | 684
Transnordestina Logistícia S.A. | (6,056) |  | (2,514)
Arvedi Metalfer do Brasil S.A. |  |  | 45
Others | 12 |  |
| 37,662 |  | 31,169
Eliminations |  |  |
To cost of sales | (13,711) |  | (8,999)
To taxes | 4,662 |  | 3,060
Others |  |  |
Amortization of fair value – investment in MRS | (2,937) |  | (2,936)
Others | 157 |  | 2,557
Equity in results adjusted | 25,833 |  | 24,851

9.c) Investments in joint ventures and joint operations

The balances of the balance sheet and statement of income of joint ventures are presented below and refer to 100% of the companies’ results:

|  |  |  |  |  | 03/31/2019 |  |  |  |  |  |  |  | 12/31/2018
|  | Joint-Venture |  | Joint-Operation |  | Joint-Venture |  | Joint-Operation
Equity interest (%) |  | MRS Logística |  | CBSI |  | Transnordestina Logística |  | Itá Energética |  | MRS Logística |  | CBSI |  | Transnordestina Logística |  | Itá Energética
| 34.94% |  | 50.00% |  | 46.30% |  | 48.75% |  | 34.94% |  | 50.00% |  | 46.30% |  | 48.75%
Balance sheet |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  | 321,174 |  | 681 |  | 21,500 |  | 41,389 |  | 345,962 |  | 2,091 |  | 19,234 |  | 29,870
Advance to suppliers |  | 15,184 |  | 85 |  | 1,788 |  | 84 |  | 17,750 |  | 73 |  | 1,734 |  | 937
Other current assets |  | 564,112 |  | 41,372 |  | 95,119 |  | 16,067 |  | 736,768 |  | 41,284 |  | 108,851 |  | 16,718
Total current assets |  | 900,470 |  | 42,138 |  | 118,407 |  | 57,540 |  | 1,100,480 |  | 43,448 |  | 129,819 |  | 47,525
Non-current assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Other non-current assets |  | 707,778 |  | 2,172 |  | 222,811 |  | 25,481 |  | 804,570 |  | 2,111 |  | 222,630 |  | 25,840
Investments, PP&E and intangible assets |  | 8,312,819 |  | 7,169 |  | 8,551,205 |  | 449,998 |  | 6,482,292 |  | 6,324 |  | 8,428,567 |  | 457,578
Total non-current assets |  | 9,020,597 |  | 9,341 |  | 8,774,016 |  | 475,479 |  | 7,286,862 |  | 8,435 |  | 8,651,197 |  | 483,418
Total Assets |  | 9,921,067 |  | 51,479 |  | 8,892,423 |  | 533,019 |  | 8,387,342 |  | 51,883 |  | 8,781,016 |  | 530,943
Current liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Borrowings and financing |  | 313,905 |  | 1,102 |  | 90,949 |  |  |  | 422,793 |  | 4,350 |  | 75,906 |  |
Other current liabilities |  | 1,165,880 |  | 39,012 |  | 179,164 |  | 16,450 |  | 1,368,290 |  | 33,844 |  | 179,816 |  | 18,298
Total current liabilities |  | 1,479,785 |  | 40,114 |  | 270,113 |  | 16,450 |  | 1,791,083 |  | 38,194 |  | 255,722 |  | 18,298
Non-current liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Borrowings and financing |  | 2,193,107 |  | 1,664 |  | 5,864,164 |  |  |  | 2,111,518 |  | 1,262 |  | 5,754,073 |  |
Other non-current liabilities |  | 2,288,718 |  | 510 |  | 218,840 |  | 15,405 |  | 640,535 |  | 539 |  | 218,839 |  | 15,113
Total non-current liabilities |  | 4,481,825 |  | 2,174 |  | 6,083,004 |  | 15,405 |  | 2,752,053 |  | 1,801 |  | 5,972,912 |  | 15,113
Shareholders’ equity |  | 3,959,457 |  | 9,191 |  | 2,539,306 |  | 501,164 |  | 3,844,206 |  | 11,888 |  | 2,552,382 |  | 497,532
Total liabilities and shareholders’ equity |  | 9,921,067 |  | 51,479 |  | 8,892,423 |  | 533,019 |  | 8,387,342 |  | 51,883 |  | 8,781,016 |  | 530,943

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|  |  |  | 01/01/2019 a 03/31/2019 |  |  |  |  | 01/01/2018 a 03/31/2018
|  | Joint-Venture |  | Joint-Operation |  | Joint-Venture | Joint - Operation
Equity interest (%) |  | MRS Logística |  | CBSI |  | Transnordestina Logística |  | Itá Energética |  |  | MRS Logística |  | CBSI |  | Transnordestina Logística |  | Itá Energética
| 34.94% |  | 50.00% |  | 46.30% |  | 48.75% |  |  | 34.94% |  | 50.00% |  | 46.30% |  | 48.75%
Statements of Income |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net revenue |  | 827,061 |  | 44,995 |  |  |  | 41,518 |  |  | 820,628 |  | 34,919 |  |  |  | 41,622
Cost of sales and services |  | (612,039) |  | (39,011) |  |  |  | (21,100) |  |  | (574,930) |  | (30,653) |  |  |  | (18,209)
Gross profit |  | 215,022 |  | 5,984 |  |  |  | 20,418 |  |  | 245,698 |  | 4,266 |  |  |  | 23,413
Operating income (expenses) |  | 39,023 |  | (3,033) |  | (7,457) |  | (15,038) |  |  | (55,809) |  | (2,442) |  | (923) |  | (14,893)
Financial income (expenses), net |  | (78,524) |  | (480) |  | (5,623) |  | 115 |  |  | (54,468) |  | (20) |  | (4,506) |  | (32)
Income before income tax and social contribution |  | 175,521 |  | 2,471 |  | (13,080) |  | 5,495 |  |  | 135,421 |  | 1,804 |  | (5,429) |  | 8,488
Current and deferred income tax and social contribution |  | (60,355) |  | (904) |  |  |  | (1,863) |  |  | (46,999) |  | (436) |  |  |  | (2,880)
Profit / (loss) for the period |  | 115,166 |  | 1,567 |  | (13,080) |  | 3,632 |  |  | 88,422 |  | 1,368 |  | (5,429) |  | 5,608

· TRANSNORDESTINA LOGÍSTICA S.A. (“TLSA”)

It is in pre-operational phase and will continue as such until the completion of Railway System II. The approved schedule, which estimated the completion of the work by January 2017, is currently under review and discussion with the responsible agencies; however, Management believes that new deadlines for project completion will not have material adverse effects on the expected return on the investment. After analyzing this matter, Management considered as appropriate the use of the accounting basis of operational continuity (going concern) of the project in the preparation of its financial statements.

The assumptions used to evaluate the impairment test in December 2018 remain valid and there is no trigger to justify records of impairment in the first quarter.

10. PROPERTY, PLANT AND EQUIPMENT

|  |  |  |  |  |  |  | Consolidated
| Land |  | Buildings and Infrastructure |  | Machinery, equipment and facilities |  | Furniture and fixtures |  | Construction in progress |  | Other (*) |  | Total
Balance at December 31, 2018 | 287,854 |  | 2,678,638 |  | 11,687,271 |  | 30,530 |  | 3,282,436 |  | 80,135 |  | 18,046,864
Cost | 287,854 |  | 3,751,429 |  | 22,426,782 |  | 165,331 |  | 3,282,436 |  | 355,768 |  | 30,269,600
Accumulated depreciation |  |  | (1,072,791) |  | (10,739,511) |  | (134,801) |  |  |  | (275,633) |  | (12,222,736)
Balance at December 31, 2018 | 287,854 |  | 2,678,638 |  | 11,687,271 |  | 30,530 |  | 3,282,436 |  | 80,135 |  | 18,046,864
Effect of foreign exchange differences | (1,032) |  | (2,361) |  | (7,831) |  | (83) |  | (121) |  | 13 |  | (11,415)
Acquisitions |  |  | 90 |  | 24,257 |  | 760 |  | 286,789 |  | 1,634 |  | 313,530
Capitalized interest (notes 24 and 27) |  |  |  |  |  |  |  |  | 21,111 |  |  |  | 21,111
Write-off (note 23) |  |  |  |  | (121) |  | (3) |  | (13,588) |  |  |  | (13,712)
Depreciation (note 22) | (4,455) |  | (33,167) |  | (266,906) |  | (1,298) |  |  |  | (8,255) |  | (314,081)
Transfers to other asset categories |  |  | 183,604 |  | 225,690 |  | 69 |  | (381,962) |  | (27,401) |  |
Transfer to intangible assets |  |  |  |  |  |  |  |  | (29) |  |  |  | (29)
Right of use- Initial recognition (Note 14a) | 556,133 |  | 54,513 |  | 9,783 |  |  |  |  |  | 20,560 |  | 640,989
Others |  |  |  |  | (541) |  |  |  | (6) |  | 49 |  | (498)
Balance at March 31, 2019 | 838,500 |  | 2,881,317 |  | 11,671,602 |  | 29,975 |  | 3,194,630 |  | 66,735 |  | 18,682,759
Cost | 842,955 |  | 3,994,541 |  | 22,658,903 |  | 165,744 |  | 3,194,630 |  | 342,459 |  | 31,199,232
Accumulated depreciation | (4,455) |  | (1,113,224) |  | (10,987,301) |  | (135,769) |  |  |  | (275,724) |  | (12,516,473)
Balance at March 31, 2019 | 838,500 |  | 2,881,317 |  | 11,671,602 |  | 29,975 |  | 3,194,630 |  | 66,735 |  | 18,682,759

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The movement of the rights of use as of March 31,2019 is as follows.

|  |  |  |  |  |  | Consolidado
| Land |  | Buildings and Infrastructure |  | Machinery, equipment and facilities |  | Other |  | Total
Initial recognition – Rights of use | 556,133 |  | 54,513 |  | 9,783 |  | 20,560 |  | 640,989
Depreciation | (4,455) |  | (1,537) |  | (815) |  | (4,406) |  | (11,213)
Balance at March 31, 2019 | 551,678 |  | 52,976 |  | 8,968 |  | 16,154 |  | 629,776

|  |  |  |  |  |  |  |  |  |  |  | Parent Company
|  | Land |  | Buildings and Infrastructure |  | Machinery, equipment and facilities |  | Furniture and fixtures |  | Construction in progress |  | Other (*) |  | Total
Balance at December 31, 2018 |  | 95,107 |  | 1,047,334 |  | 7,093,263 |  | 12,372 |  | 1,294,908 |  | 19,989 |  | 9,562,973
Cost |  | 95,107 |  | 1,323,762 |  | 13,411,258 |  | 97,642 |  | 1,294,908 |  | 123,104 |  | 16,345,781
Accumulated depreciation |  |  |  | (276,428) |  | (6,317,995) |  | (85,270) |  |  |  | (103,115) |  | (6,782,808)
Balance at December 31, 2018 |  | 95,107 |  | 1,047,334 |  | 7,093,263 |  | 12,372 |  | 1,294,908 |  | 19,989 |  | 9,562,973
Acquisitions |  |  |  |  |  | 7,636 |  | 84 |  | 149,239 |  | 1,230 |  | 158,189
Capitalized interest (notes 24 and 27) |  |  |  |  |  |  |  |  |  | 5,419 |  |  |  | 5,419
Write-off (note 23) |  |  |  |  |  | (11) |  | (3) |  | (13,528) |  |  |  | (13,542)
Depreciation (note 22) |  | (1,776) |  | (8,725) |  | (141,297) |  | (593) |  |  |  | (3,679) |  | (156,070)
Transfers to other asset categories |  |  |  | (481) |  | 48,173 |  | (3) |  | (47,689) |  |  |  |
Right of use- Initial recognition (Note 14a) |  | 37,864 |  |  |  | 9,784 |  |  |  |  |  | 13,424 |  | 61,072
Balance at March 31, 2019 |  | 131,195 |  | 1,038,128 |  | 7,017,548 |  | 11,857 |  | 1,388,349 |  | 30,964 |  | 9,618,041
Cost |  | 131,195 |  | 1,323,231 |  | 13,476,857 |  | 97,701 |  | 1,388,349 |  | 137,758 |  | 16,555,091
Accumulated depreciation |  |  |  | (285,103) |  | (6,459,309) |  | (85,844) |  |  |  | (106,794) |  | (6,937,050)
Balance at March 31, 2019 |  | 131,195 |  | 1,038,128 |  | 7,017,548 |  | 11,857 |  | 1,388,349 |  | 30,964 |  | 9,618,041

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(*) Refer basically to railway assets such as courtyards, tracks and leasehold improvements, vehicles, hardware, mines, ore deposits, and spare part inventories.

The movement of the rights of use as of March 31,2019 is as follows.

|  |  |  |  |  | Consolidado
| Land |  |  | Machinery, equipment and facilities |  | Other |  | Total
Initial recognition – Rights of use | 37,864 |  |  | 9,784 |  | 13,424 |  | 61,072
Depreciation | (1,774) |  |  | (815) |  | (2,877) |  | (5,466)
Balance at March 31, 2019 | 36,090 |  |  | 8,969 |  | 10,547 |  | 55,606

The breakdown of the projects comprising construction in progress is as follows:

|  |  |  |  |  |  |  | Consolidado
|  | Project description |  | Start date |  | Completion Date |  | 03/31/2019 |  | 12/31/2018
Logistics |  |  |  |  |  |  |  |  |  |
|  | Current investments for maintenance of current operations. |  |  |  |  |  | 73,102 |  | 89,595
|  |  |  |  |  |  |  | 73,102 |  | 73,102
Mining |  |  |  |  |  |  |  |  |  |
|  | Expansion of Casa de Pedra Mine capacity production. |  | 2007 |  | 2020 | (1) | 854,508 |  | 844,194
|  | Expansion of TECAR export capacity. |  | 2009 |  | 2022 | (2) | 292,342 |  | 289,298
|  | Current investments for maintenance of current operations. |  |  |  |  |  | 532,425 |  | 725,616
|  |  |  |  |  |  |  | 1,679,275 |  | 1,859,108
Steel |  |  |  |  |  |  |  |  |  |
|  | Supply of 16 torpedo’s cars for operation in the steel industry. |  | 2008 |  | 2020 |  | 95,945 |  | 94,920
|  | Current investments for maintenance of current operations. |  |  |  |  | (3) | 666,153 |  | 558,922
|  |  |  |  |  |  |  | 762,098 |  | 653,842
Cement |  |  |  |  |  |  |  |  |  |
|  | Construction of cement plants. |  | 2011 |  | 2023 | (4) | 574,570 |  | 585,163
|  | Current investments for maintenance of current operations. |  |  |  |  |  | 105,585 |  | 94,728
|  |  |  |  |  |  |  | 680,155 |  | 679,891
Construction in progress |  |  |  |  |  | 3,194,630 |  | 3,282,436

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(1) Estimated completion date of the Central Plant Step 1;

(2) Estimated completion date of phase 60 Mtpa;

(3) Refers substantially to the technological modernization continuous running machines and reform of blast furnace 3, at UPV;

(4) Refers substantially to the acquisition of new Integrated Cement Plants.

The average estimated useful lives are as follows (in years):

|  |  | Consolidated |  |  | Parent Company
| 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
In Years |  |  |  |  |  |  |
Buildings | 39 |  | 38 |  | 41 |  | 41
Machinery, equipment and facilities | 22 |  | 22 |  | 24 |  | 24
Furniture and fixtures | 13 |  | 11 |  | 12 |  | 11
Others | 18 |  | 15 |  | 15 |  | 13

11. INTANGIBLE ASSETS

|  |  |  |  |  |  |  |  |  |  |  |  | Consolidated |  |  |  |  | Parent Company
| Goodwill |  | Customer relationships |  | Software |  | Trademarks and patents |  | Rights and licenses (*) |  | Others |  | Total |  |  | Software |  | Total
Balance at December 31, 2018 | 3,590,931 |  | 288,773 |  | 54,972 |  | 150,009 |  | 3,166,999 |  | 1,491 |  | 7,253,175 |  |  | 49,613 |  | 49,613
Cost | 3,831,338 |  | 573,614 |  | 161,067 |  | 150,009 |  | 3,185,701 |  | 1,491 |  | 7,903,220 |  |  | 125,768 |  | 125,768
Accumulated amortization | (131,077) |  | (284,841) |  | (106,095) |  |  |  | (18,702) |  |  |  | (540,715) |  |  | (76,155) |  | (76,155)
Adjustment for accumulated recoverable value | (109,330) |  |  |  |  |  |  |  |  |  |  |  | (109,330) |  |  |  |  | -
Balance at December 31, 2018 | 3,590,931 |  | 288,773 |  | 54,972 |  | 150,009 |  | 3,166,999 |  | 1,491 |  | 7,253,175 |  |  | 49,613 |  | 49,613
Effect of foreign exchange differences |  |  | (4,340) |  | (24) |  | (2,129) |  |  |  | (23) |  | (6,516) |  |  |  |  |
Acquisitions and expenditures |  |  |  |  | 49 |  |  |  |  |  |  |  | 49 |  |  |  |  |
Transfer to property, plant and equipment |  |  |  |  | 29 |  |  |  |  |  |  |  | 29 |  |  |  |  |
Amortization (note 22) |  |  | (11,438) |  | (2,511) |  |  |  | (40) |  |  |  | (13,989) |  |  | (1,937) |  | (1,937)
Balance at March 31, 2019 | 3,590,931 |  | 272,995 |  | 52,515 |  | 147,880 |  | 3,166,959 |  | 1,468 |  | 7,232,748 |  |  | 47,676 |  | 47,676
Cost | 3,831,338 |  | 565,492 |  | 161,498 |  | 147,880 |  | 3,185,701 |  | 1,468 |  | 7,893,377 |  |  | 125,768 |  | 125,768
Accumulated amortization | (131,077) |  | (292,497) |  | (108,983) |  |  |  | (18,742) |  |  |  | (551,299) |  |  | (78,092) |  | (78,092)
Adjustment for accumulated recoverable value | (109,330) |  |  |  |  |  |  |  |  |  |  |  | (109,330) |  |  |  |  |
Balance at March 31, 2019 | 3,590,931 |  | 272,995 |  | 52,515 |  | 147,880 |  | 3,166,959 |  | 1,468 |  | 7,232,748 |  |  | 47,676 |  | 47,676

(*) Composed mainly by mineral rights with potential of 1,101 million tons (Not audited or reviewed by independent auditors). Amortization is based on production volume.

The average useful lives by nature are as follows (in years):

|  |  | Consolidated |  |  |  | Parent Company
| 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Software | 9 |  | 7 |  | 9 |  | 8
Customer relationships | 13 |  | 13 |  |  |  |

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The assumptions used for the impairment test in December 2018 are still effective and there is not factor that justifies the recognition of impairment in the quarter.

12. BORROWINGS, FINANCING AND DEBENTURES

The balances of borrowings, financing and debentures, which are carried at amortized cost, are as follows:

|  |  |  |  | Consolidated |  |  |  | Parent Company
|  |  | Current liabilities |  | Non-current liabilities |  | Current liabilities |  | Non-current liabilities
|  |  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Debt agreements in the international market |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Variable interest in US$: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Prepayment |  |  | 1,462,825 |  | 1,016,737 |  | 3,357,592 |  | 3,830,240 |  | 1,462,825 |  | 1,016,737 |  | 3,357,592 |  | 3,830,240
Fixed interest in US$: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Bonds, Perpetual Bonds and ACC |  |  | 2,310,207 |  | 2,490,178 |  | 8,662,173 |  | 8,613,491 |  | 400,119 |  | 478,463 |  |  |  |
|  |  |  |  |  |  |  |  |  |  | 2,908,191 |  | 3,070,423 |  | 5,007,094 |  | 4,610,620
EUR |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Intercompany |  |  |  |  |  |  |  |  |  |  | 5,524 |  | 16,988 |  | 1,167,002 |  | 997,809
Others |  |  | 149,606 |  | 181,056 |  | 175,040 |  | 106,535 |  |  |  |  |  |  |  |
|  |  | 3,922,638 |  | 3,687,971 |  | 12,194,805 |  | 12,550,266 |  | 4,776,659 |  | 4,565,623 |  | 9,531,688 |  | 8,440,860
Debt agreements in Brazil |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Securities with variable interest in R$: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
BNDES/FINAME, Debentures, NCE and CCB | (1) |  | 1,476,945 |  | 1,890,450 |  | 10,795,026 |  | 10,710,678 |  | 1,416,533 |  | 1,827,769 |  | 9,402,503 |  | 9,314,315
Securities with fixed interest in R$: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Prepayment |  |  | 48,000 |  | 103,375 |  |  |  |  |  | 48,000 |  | 103,375 |  |  |  |
|  |  | 1,524,945 |  | 1,993,826 |  | 10,795,026 |  | 10,710,678 |  | 1,464,533 |  | 1,931,144 |  | 9,402,503 |  | 9,314,315
Total Borrowings and Financing |  |  | 5,447,583 |  | 5,681,797 |  | 22,989,831 |  | 23,260,944 |  | 6,241,192 |  | 6,496,767 |  | 18,934,191 |  | 17,755,175
Transaction Costs and Issue Premiums |  |  | (32,445) |  | (28,358) |  | (102,275) |  | (87,309) |  | (27,003) |  | (22,379) |  | (84,126) |  | (67,967)
Total Borrowings and Financing + Transaction Costs |  |  | 5,415,138 |  | 5,653,439 |  | 22,887,556 |  | 23,173,635 |  | 6,214,189 |  | 6,474,388 |  | 18,850,065 |  | 17,687,208

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(1) In January 2019, the Company issued debt securities in the domestic market ("Debentures"), in the amount of R$1,950 million, maturing in 2023 and interest of 126.8% of the CDI

The following table shows the average interest rate:

|  | Consolidated |  |  |  | Parent Company
|  |  |  | 03/31/2019 |  |  |  | 03/31/2019
|  | Average interest rate (*) |  | Total debt |  | Average interest rate (*) |  | Total debt
US$ |  | 5.58% |  | 15,792,797 |  | 4.52% |  | 13,135,821
R$ |  | 8.20% |  | 12,319,971 |  | 8.18% |  | 10,867,036
EUR |  | 3.88% |  | 324,646 |  | 3.88% |  | 1,172,526
|  |  |  | 28,437,414 |  |  |  | 25,175,383

(i) In order to determine the average interest rates for debt contracts with floating rate, the Company used the rates applied as of March 31, 2018. Considers the interest rate of intercompany contracts.

12.a) Maturities of borrowings, financing and debentures presented in noncurrent liabilities

As of March 31, 2019, the breakdown of principal plus interest of long-term liabilities as borrowings, financing and debentures by maturity date is presented as follows:

|  |  |  |  |  |  |  | Consolidated |  | Parent Company
|  |  |  |  |  |  |  | 03/31/2019 |  | 03/31/2019
|  |  |  |  |  |  |  | Principal |  | Principal
|  | Bank loans |  | Capital markets |  | Development agencies |  | Total |  | Total
2020 |  | 1,636,089 |  | 3,596,628 |  | 56,292 |  | 5,289,009 |  | 2,793,403
2021 |  | 2,913,341 |  | 636,667 |  | 56,311 |  | 3,606,319 |  | 4,046,997
2022 |  | 2,738,475 |  | 556,666 |  | 55,082 |  | 3,350,223 |  | 3,820,867
2023 |  | 2,865,024 |  | 2,013,845 |  | 53,841 |  | 4,932,710 |  | 3,122,440
2024 |  | 1,276,001 |  |  |  | 64,602 |  | 1,340,603 |  | 3,793,007
After 2024 |  |  |  |  |  | 574,267 |  | 574,267 |  | 1,357,477
Perpetual bonds |  |  |  | 3,896,700 |  |  |  | 3,896,700 |  |
|  | 11,428,930 |  | 10,700,506 |  | 860,395 |  | 22,989,831 |  | 18,934,191

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12.b) Borrowings raised and amortization, financing and debentures

The table below presents the funding raised and amortizations during the year:

| Consolidated |  | Parent Company
|  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Opening balance |  | 28,827,074 |  | 29,510,844 |  | 24,161,596 |  | 29,033,017
Funding raised |  | 2,465,845 |  | 2,154,471 |  | 3,828,529 |  | 602,110
Principal repayment |  | (2,939,145) |  | (5,019,978) |  | (2,986,303) |  | (6,098,209)
Payments of charges |  | (590,621) |  | (2,141,710) |  | (368,593) |  | (1,670,988)
Provision of charges |  | 487,039 |  | 2,009,688 |  | 354,458 |  | 1,541,639
Write-off - sale of subsidiary LLC |  |  |  | (10,544) |  |  |  |
Others (1) |  | 52,502 |  | 2,324,303 |  | 74,567 |  | 754,027
Closing balance |  | 28,302,694 |  | 28,827,074 |  | 25,064,254 |  | 24,161,596

1. Includes unrealized monetary and foreign exchange variations.

As of March 31, 2019, the Group raised and paid borrowings as shown below:

· Funding raised and amortizations:

|  |  |  |  |  | Consolidated 12/31/2018
Nature |  | Raised |  | Amortization of principal |  | Amortization of charges
Prepayment |  |  |  | (289,552) |  | (45,804)
Bonds, Perpetual bonds and ACC |  | 515,845 |  | (502,889) |  | (295,720)
BNDES/FINAME, Debentures, NCE and CCB |  | 1,950,000 |  | (2,146,704) |  | (249,097)
Total |  | 2,465,845 |  | (2,939,145) |  | (590,621)

· Covenants

The Company's loan agreements establish the fulfillment of certain non-financial obligations, as well as maintenance of certain parameters and performance indicators, such as disclosure of its audited financial statements according to regulatory deadlines or payment of commission on risk assumption, if the net debt-EBITDA ratio reaches the levels in those agreements, under penalty of anticipated maturity. The Company is

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12.c) Guarantees

The Company is the guarantor or is liable for the guarantees given to its subsidiaries and joint ventures as follows:

| Currency |  | Maturities |  | Borrowings | Tax foreclosure | Others | Total
|  |  |  |  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Transnordestina Logísitca | R$ |  | Up to 09/19/2056 and Indefinite |  | 2,428,194 |  | 2,108,917 |  | 26,558 |  | 35,336 |  | 8,457 |  | 8,231 |  | 2,463,209 |  | 2,152,484
FTL - Ferrovia Transnordestina | R$ |  | 11/15/2020 |  | 50,428 |  | 62,407 |  |  |  |  |  |  |  |  |  | 50,428 |  | 62,407
Cia Metalurgica Prada | R$ |  | Indefinite |  |  |  |  |  | 333 |  | 333 |  | 11,942 |  | 11,942 |  | 12,275 |  | 12,275
CSN Energia | R$ |  | Until 11/26/2023 and Indefinite |  |  |  |  |  | 2,829 |  | 2,829 |  | 1,920 |  | 1,920 |  | 4,749 |  | 4,749
CSN Mineração | R$ |  | Until 12/21/2024 |  | 1,407,363 |  | 1,407,363 |  |  |  |  |  |  |  |  |  | 1,407,363 |  | 1,407,363
Estanho de Rondônia | R$ |  | 07/15/2022 |  | 3,153 |  | 3,153 |  |  |  |  |  |  |  |  |  | 3,153 |  | 3,153
Minérios Nacional S.A. | R$ |  | Until 09/10/2021 |  | 7,305 |  | 7,305 |  |  |  |  |  |  |  |  |  | 7,305 |  | 7,305
Total in R$ |  |  |  |  | 3,896,443 |  | 3,589,145 |  | 29,720 |  | 38,498 |  | 22,319 |  | 22,093 |  | 3,948,482 |  | 3,649,736
CSN Islands XI | US$ |  | 09/21/2019 |  | 547,094 |  | 547,094 |  |  |  |  |  |  |  |  |  | 547,094 |  | 547,094
CSN Islands XII | US$ |  | Perpetual |  | 1,000,000 |  | 1,000,000 |  |  |  |  |  |  |  |  |  | 1,000,000 |  | 1,000,000
CSN Resources | US$ |  | Until 2/13/2023 |  | 1,402,906 |  | 1,402,906 |  |  |  |  |  |  |  |  |  | 1,402,906 |  | 1,402,906
Total in US$ |  |  |  |  | 2,950,000 |  | 2,950,000 |  |  |  |  |  |  |  |  |  | 2,950,000 |  | 2,950,000
CSN Steel S.L. | EUR |  | 1/31/2020 |  | 24,000 |  | 48,000 |  |  |  |  |  |  |  |  |  | 24,000 |  | 48,000
Lusosider Aços Planos | EUR |  | Indefinite |  | 50,000 |  | 75,000 |  |  |  |  |  |  |  |  |  | 50,000 |  | 75,000
Total in EUR |  |  |  |  | 74,000 |  | 123,000 |  |  |  |  |  |  |  |  |  | 74,000 |  | 123,000
Total in R$ |  |  |  |  | 11,819,089 |  | 11,976,657 |  |  |  |  |  |  |  |  |  | 11,819,089 |  | 11,976,657
|  |  |  |  | 15,715,532 |  | 15,565,802 |  | 29,720 |  | 38,498 |  | 22,319 |  | 22,093 |  | 15,767,571 |  | 15,626,393

13. FINANCIAL INSTRUMENTS

I - Identification and measurement of financial instruments

The Company enters into transactions involving various financial instruments, mainly cash and cash equivalents, including short-term investments, marketable securities, trade receivables, trade payables, and borrowings and financing. The Company also enters into derivative transactions, especially interest rate and foreign exchange rate swaps.

Considering the nature of the instruments, the fair value is basically determined by the use of quotations in the open capital market of Brazil and the Commodities and Futures Exchange. The amounts recorded in current assets and liabilities have immediate liquidity or maturity, mostly in terms of less than three months. Considering the term and the characteristics of these instruments, the book values approximate the fair values.

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· Classification of financial instruments

|  |  |  |  |  |  |  |  |  |  |  |  |  | Consolidated
Consolidated |  |  |  |  |  | 3/31/2019 |  |  |  | 12/31/2018
| Notes |  | Fair value through profit or loss |  | Measured at amortized cost |  | Balances |  | Fair value through profit or loss |  | Measured at amortized cost |  | Balances
Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  | 4 |  |  |  | 2,702,077 |  | 2,702,077 |  |  |  | 2,248,004 |  | 2,248,004
Short-term investments |  | 5 |  |  |  | 778,608 |  | 778,608 |  |  |  | 895,713 |  | 895,713
Trade receivables |  | 6 |  |  |  | 2,835,396 |  | 2,835,396 |  |  |  | 2,078,182 |  | 2,078,182
Dividends receivable |  | 8 |  |  |  | 48,315 |  | 48,315 |  |  |  | 46,171 |  | 46,171
Derivative financial instruments |  | 8 |  |  |  |  |  |  |  | 351 |  |  |  | 351
Trading securities |  | 8 |  | 9,954 |  |  |  | 9,954 |  | 4,503 |  |  |  | 4,503
Loans - related parties |  | 8 |  |  |  | 2,710 |  | 2,710 |  |  |  | 2,675 |  | 2,675
Total |  |  |  | 9,954 |  | 6,367,106 |  | 6,377,060 |  | 4,854 |  | 5,270,745 |  | 5,275,599
Non-current |  |  |  |  |  |  |  |  |  |  |  |  |  |
Short-term investments |  | 5 |  |  |  | 7,829 |  | 7,829 |  |  |  | 7,772 |  | 7,772
Other trade receivables |  | 8 |  |  |  | 7,438 |  | 7,438 |  |  |  | 7,451 |  | 7,451
Eletrobrás compulsory loan |  | 8 |  |  |  | 827,774 |  | 827,774 |  |  |  | 813,428 |  | 813,428
Loans - related parties |  | 8 |  |  |  | 744,364 |  | 744,364 |  |  |  | 706,605 |  | 706,605
Investments |  | 9 |  | 2,407,223 |  |  |  | 2,407,223 |  | 2,279,189 |  |  |  | 2,279,189
Total |  |  |  | 2,407,223 |  | 1,587,405 |  | 3,994,628 |  | 2,279,189 |  | 1,535,256 |  | 3,814,445
Total Assets |  |  |  | 2,417,177 |  | 7,954,511 |  | 10,371,688 |  | 2,284,043 |  | 6,806,001 |  | 9,090,044
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current |  |  |  |  |  |  |  |  |  |  |  |  |  |
Borrowings and financing |  | 12 |  |  |  | 5,447,583 |  | 5,447,583 |  |  |  | 5,681,797 |  | 5,681,797
Lease |  | 14.a |  |  |  | 45,742 |  | 45,742 |  |  |  |  |  |
Derivative financial instruments |  |  |  | 3 |  |  |  | 3 |  |  |  |  |  |
Trade payables |  |  |  |  |  | 3,228,213 |  | 3,228,213 |  |  |  | 3,408,056 |  | 3,408,056
Suppliers - Forfating |  | 14 |  |  |  | 300,947 |  | 300,947 |  |  |  | 65,766 |  | 65,766
Dividends and interest on capital |  | 14 |  |  |  | 932,005 |  | 932,005 |  |  |  | 932,005 |  | 932,005
Total |  |  |  | 3 |  | 9,954,490 |  | 9,954,493 |  |  |  | 10,087,624 |  | 10,087,624
Non-current |  |  |  |  |  |  |  |  |  |  |  |  |  |
Borrowings and financing |  | 12 |  |  |  | 22,989,831 |  | 22,989,831 |  |  |  | 23,260,945 |  | 23,260,945
Lease |  | 14.a |  |  |  | 587,496 |  | 587,496 |  |  |  |  |  |
Total |  |  |  |  |  | 23,577,327 |  | 23,577,327 |  |  |  | 23,260,945 |  | 23,260,945
Total Liabilities |  |  |  | 3 |  | 33,531,817 |  | 33,531,820 |  |  |  | 33,348,569 |  | 33,348,569

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|  |  |  |  |  |  |  |  |  |  |  |  |  | Parent Company
Parent Company |  |  |  |  |  | 03/31/2019 |  |  |  | 12/31/2018
| Notes |  | Fair value through profit or loss |  | Measured at amortized cost |  | Balances |  | Fair value through profit or loss |  | Measured at amortized cost |  | Balances
Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  | 4 |  |  |  | 293,986 |  | 293,986 |  |  |  | 539,853 |  | 539,853
Short-term investments |  | 5 |  |  |  | 775,068 |  | 775,068 |  |  |  | 882,997 |  | 882,997
Trade receivables |  | 6 |  |  |  | 2,235,789 |  | 2,235,789 |  |  |  | 1,965,817 |  | 1,965,817
Dividends receivable |  | 8 |  |  |  | 261,330 |  | 261,330 |  |  |  | 259,186 |  | 259,186
Trading securities |  | 8 |  | 9,806 |  |  |  | 9,806 |  | 4,352 |  |  |  | 4,352
Loans - related parties |  | 8 |  |  |  | 23,264 |  | 23,264 |  |  |  | 22,807 |  | 22,807
Total |  |  |  | 9,806 |  | 3,589,437 |  | 3,599,243 |  | 4,352 |  | 3,670,660 |  | 3,675,012
Non-current |  |  |  |  |  |  |  |  |  |  |  |  |  |
Other trade receivables |  | 8 |  |  |  | 1,173 |  | 1,173 |  |  |  | 1,213 |  | 1,213
Eletrobrás compulsory loan |  | 8 |  |  |  | 826,934 |  | 826,934 |  |  |  | 812,803 |  | 812,803
Loans - related parties |  | 8 |  |  |  | 649,967 |  | 649,967 |  |  |  | 588,285 |  | 588,285
Investments |  | 9 |  | 2,407,223 |  |  |  | 2,407,223 |  | 2,279,189 |  |  |  | 2,279,189
Total |  |  |  | 2,407,223 |  | 1,478,074 |  | 3,885,297 |  | 2,279,189 |  | 1,402,301 |  | 3,681,490
Total Assets |  |  |  | 2,417,029 |  | 5,067,511 |  | 7,484,540 |  | 2,283,541 |  | 5,072,961 |  | 7,356,502
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current |  |  |  |  |  |  |  |  |  |  |  |  |  |
Borrowings and financing |  | 12 |  |  |  | 6,241,192 |  | 6,241,192 |  |  |  | 6,496,768 |  | 6,496,768
Lease |  | 14.a |  |  |  | 20,453 |  | 20,453 |  |  |  |  |  |
Derivative financial instruments |  |  |  | 3 |  |  |  | 3 |  |  |  |  |  |
Trade payables |  |  |  |  |  | 2,536,172 |  | 2,536,172 |  |  |  | 2,655,091 |  | 2,655,091
Suppliers - Forfating |  | 14 |  |  |  | 300,947 |  | 300,947 |  |  |  | 65,766 |  | 65,766
Dividends and interest on capital |  | 14 |  |  |  | 900,541 |  | 900,541 |  |  |  | 900,541 |  | 900,541
Total |  |  |  | 3 |  | 9,999,305 |  | 9,999,308 |  |  |  | 10,118,166 |  | 10,118,166
Non-current |  |  |  |  |  |  |  |  |  |  |  |  |  |
Borrowings and financing |  | 12 |  |  |  | 18,934,191 |  | 18,934,191 |  |  |  | 17,755,175 |  | 17,755,175
Lease |  | 14.a |  |  |  | 35,271 |  | 35,271 |  |  |  |  |  |
Total |  |  |  |  |  | 18,969,462 |  | 18,969,462 |  |  |  | 17,755,175 |  | 17,755,175
Total Liabilities |  |  |  | 3 |  | 28,968,767 |  | 28,968,770 |  |  |  | 27,873,341 |  | 27,873,341

· Fair value measurement

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The following table shows the financial instruments recognized at fair value through profit or loss classifying them according to the fair value hierarchy:

Consolidated |  | 03/31/2019 |  | 12/31/2018
| Level 1 |  | Level 2 |  | Balances |  | Level 1 |  | Level 2 |  | Balances
Assets |  |  |  |  |  |  |  |  |  |  |  |
Current |  |  |  |  |  |  |  |  |  |  |  |
Financial assets at fair value through profit or loss |  |  |  |  |  |  |  |  |  |  |  |
Derivative financial instruments |  |  |  |  |  |  |  |  |  | 351 |  | 351
Trading securities |  | 9,954 |  |  |  | 9,954 |  | 4,503 |  |  |  | 4,503
Non-current |  |  |  |  |  |  |  |  |  |  |  |
Financial assets at fair value through profit or loss |  |  |  |  |  |  |  |  |  |  |  |
Investments |  | 2,407,223 |  |  |  | 2,407,223 |  | 2,279,189 |  |  |  | 2,279,189
Total Assets |  | 2,417,177 |  |  |  | 2,417,177 |  | 2,283,692 |  | 351 |  | 2,284,043
Liabilities |  |  |  |  |  |  |  |  |  |  |  |
Current |  |  |  |  |  |  |  |  |  |  |  |
Financial liabilities at fair value through profit or loss |  |  |  |  |  |  |  |  |  |  |  |
Derivative financial instruments |  |  |  | 3 |  | 3 |  |  |  |  |  |
Total Liabilities |  |  |  | 3 |  | 3 |  |  |  |  |  |

Level 1: quoted prices in active markets for identical assets or liabilities.

Level 2: Includes observable inputs in market such as interest rates, exchange etc., but not prices traded in active markets.

There are no assets and liabilities classified as level 3.

II – Investments in securities measured at fair value through profit or loss

The Company has investments in common shares (USIM3), preferred shares (USIM5) of Usiminas ("Ações Usiminas") and shares of Panatlântica S.A. (PATI3) which are designated as fair value through profit or loss, since the nature of the investment was not included in the other categories of financial instruments.

Assets are classified as a non-current asset recognized as investment and are recorded at fair value, based on the market price quotation on the stock exchange (B3 S.A.). In accordance with the Company's policy, gains and losses arising from changes in the share price are recorded directly in the statement of income under Other Operating Income and Expenses.

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Class of shares |  | 3/31/2019 |  | Purchase of shares |  | 12/31/2018 |  | 3/31/2019
| Quantity |  | Share price |  | Closing Balance |  | Quantity |  | Share price |  | Cash Received |  | Quantity |  | Share price |  | Closing Balance |  | Fair Value Through Profit or Loss (note 23)
USIM3 |  | 107,156,651 |  | 11.65 |  | 1,248,375 |  |  |  |  |  |  |  | 107,156,651 |  | 11.44 |  | 1,225,872 |  | 22,503
USIM5 |  | 111,144,456 |  | 10.04 |  | 1,115,890 |  |  |  |  |  |  |  | 111,144,456 |  | 9.22 |  | 1,024,752 |  | 91,138
PATI3 |  | 2,016,792 |  | 21.30 |  | 42,958 |  | 19,150 |  | 19.83 |  | 379,657 |  | 1,997,642 |  | 14.30 |  | 28,565 |  | 14,012
|  | 220,317,899 |  |  |  | 2,407,223 |  | 19,150 |  |  |  | 379,657 |  | 220,298,749 |  |  |  | 2,279,189 |  | 127,653
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 127,653

As of March 31, 2019, and December 31, 2018, the Company's interest in USIMINAS comprised 15.19% in common shares and 20.29% in preferred shares. As of March 31,2019 and December 31, 2018, the Company's interest in Panatlântica comprised 11.31% of shares.

On April 9, 2014, CADE issued a decision regarding Usiminas' shares held by CSN, and CSN entered into a Performance Commitment Agreement, or TCD, with CADE in respect thereof. Under the terms of the CADE and TCD decision, CSN must reduce its participation in USIMINAS, within a specified period. In March 2019, an amendment was made to the TCD, with the purpose of extending the period originally scheduled for sale of the shares. The deadline and percentage reduction are confidential. In addition, the political rights in Usiminas will continue to be suspended until the Company reaches the limits established in the TCD.

• Share market price risks

The Company is exposed to the risk of changes in the price of the shares due to the investments, valued at fair value through profit or loss and other comprehensive income that have their prices based on the market price on the stock exchange (B3).

III - Financial risk management:

The Company follows risk management strategies, with guidelines in relation to the risks incurred by the company. The nature and general position of financial risks are regularly monitored and managed in order to assess the results and the financial impact on cash flow. The quality of counterparties’ hedging instruments and the credit limit are also periodically reviewed.

Market risks are protected when it is considered necessary to support the corporate strategy or when it is necessary to maintain the level of financial flexibility.

The Company can manage some of risks by using derivative instruments not associated with any speculative trading or short selling.

13.a) Foreign exchange rate and interest rate risks:

· Foreign exchange rate risk:

The exposure arises from the existence of assets and liabilities denominated in Dollar or Euro, since the Company's functional currency is substantially the Real and is denominated natural currency hedge. The net exposure is the result of offsetting the natural currency exposure by hedging instruments adopted by CSN.

The consolidated net exposure as of March 31, 2019 is as follows.

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|  |  |  | 03/31/2019
Foreign Exchange Exposure |  | (Amounts in US$’000) |  | (Amounts in €’000)
Cash and cash equivalents overseas |  | 99,452 |  | 4,042
Trade receivables |  | 485,775 |  | 1,416
Other assets |  | 7,298 |  | 4,376
Total Assets |  | 592,525 |  | 9,834
Borrowings and financing |  | (4,052,864) |  | (24,152)
Trade payables |  | (124,734) |  | (7,859)
Other liabilities |  | (3,484) |  | (1,100)
Total Liabilities |  | (4,181,082) |  | (33,111)
Foreign exchange exposure |  | (3,588,557) |  | (23,277)
Cash flow hedge accounting |  | 1,862,224 |  |
Net Investment hedge accounting |  |  |  | 24,000
Net foreign exchange exposure |  | (1,726,333) |  | 723
Perpetual bonds |  | 1,000,000 |  |
Net foreign exchange exposure excluding perpetual bonds |  | (726,333) |  | 723

CSN uses as strategy the hedge accounting, as well as derivative instruments with the purpose of hedging CSN's future cash flows.

· Interest rate risk:

Risk arises from short and long term liabilities with fixed or post fixed interest rates and inflation rates.

In item 13b) we show the derivatives and hedging strategies to hedge foreign exchange and interest rate risks.

13.b) Hedging instruments: Derivative and cash flows hedge accounting and foreign investment hedge accounting

CSN uses various instruments to hedge foreign exchange and interest rate risks, as shown in the following topics:

· Portfolio of derivative financial instruments

Swap cambial Dólar x Euro

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The subsidiary Lusosider has derivative operations to hedge its exposure of the dollar against the euro.

|  |  |  |  |  |  |  |  |  |  |  | Consolidated
|  |  |  |  |  |  |  |  |  |  |  |  |  | 03/31/2019
|  |  |  |  |  |  |  | Appreciation (R$) |  | Fair value (market) |  | Impact on financial income (expenses) in 2019
Counterparties |  | Maturity |  | Functional Currency |  | Notional amount |  | Asset position |  | Liability position |  | Amounts receivable / (payable) |
BCP |  | 02/04/2019 |  | Dollar |  | 1,262 |  | 4,915 |  | (4,918) |  | (3) |  | (354)
Total dollar-to-euro swap |  |  |  | 1,262 |  | 4,915 |  | (4,918) |  | (3) |  | (354)

· Classification of the derivatives in the balance sheet and statement of income

|  |  |  |  |  | 03/31/2019 |  | 03/31/2018
Instruments |  | Assets |  | Net Financial result (Note 24)
| Current |  | Total |
Swap dólar x euro |  | (3) |  | (3) |  | (354) |  | 730
|  | (3) |  | (3) |  | (354) |  | 730

· Cash flow hedge accounting

Beginning November 1, 2014, the Company formally designates cash flow hedging relationships to hedge highly probable future cash flows against US dollar fluctuations.

In order to better reflect the accounting impacts of this foreign exchange hedging strategy on the Company’s results, CSN designated part of its US dollar-denominated liabilities as a hedging instrument of its future exports. As a result, foreign exchange differences arising from designated liabilities will be temporarily recognized in shareholders’ equity and recognized in profit or loss when such exports are carried out, allowing the recognition of the fluctuation of the dollar over liabilities and exports can be recorded at the same time. The adoption of this hedge accounting does not entail entering into any financial instrument. As of March 31, 2019, US$1.862.224 in exports to be carried out between April 2019 until February 2023 are designated.

In order to support the aforementioned designations, the Company prepared formal documentation indicating how the hedge designation is aligned with CSN's objective and risk management strategy, identifying the hedging instruments used, the hedge object, the nature of the risk to be hedged and demonstrating the expectation of high effectiveness of the designated relations. Debt instruments have been designated in amounts equivalent to the portion of future exports. Therefore, the exchange variation of the instrument and the object are similar. According to the Company's accounting policy, continuous evaluations of prospective and retrospective effectiveness should be carried out, comparing the amounts designated with the amounts expected and approved in the Management's budgets, as well as the amounts exported.

Through hedge accounting, the exchange gains and losses on debt instruments will not immediately affect the Company’s profit or loss except to the extent that exports are carried out.

The table below shows a summary of the hedging relationships as of March 31, 2019:

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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 03/31/2019
Designation Date |  | Hedging Instrument |  | Hedged item |  | Type of hedged risk |  | Hedged period |  | Exchange rate on designation |  | Designated amounts (US$’000) |  | Amortizated part (USD'000) |  | ffect on Result (*) (R$'000) |  | Impact on Shareholders' equity (R$'000)
3/11/2014 |  | Export prepayments in US$ to third parties |  | Part of the highly probable future monthly iron ore exports |  | Foreign exchange - R$ vs. US$ spot rate |  | October 2016 - September 2019 |  | 2.4442 |  | 500,000 |  | (331,823) |  | (118,845) |  | (244,279)
1/12/2014 |  | Export prepayments in US$ to third parties |  | Part of the highly probable future monthly iron ore exports |  | Foreign exchange - R$ vs. US$ spot rate |  | October 2015 - February 2019 |  | 2.5601 |  | 175,000 |  | (175,000) |  | (23,184) |  |
12/18/2014 |  | Export prepayments in US$ to third parties |  | Part of the highly probable future monthly iron ore exports |  | Foreign exchange - R$ vs. US$ spot rate |  | May 2020 |  | 2.6781 |  | 100,000 |  |  |  |  |  | (121,860)
07/21/2015 |  | Export prepayments in US$ to third parties |  | Part of the highly probable future monthly iron ore exports |  | Foreign exchange - R$ vs. US$ spot rate |  | July 2019 - March 2021 |  | 3.1813 |  | 60,000 |  |  |  |  |  | (42,924)
07/23/2015 |  | Export prepayments in US$ to third parties |  | Part of the highly probable future monthly iron ore exports |  | Foreign exchange - R$ vs. US$ spot rate |  | July 2019 - March 2021 |  | 3.2850 |  | 100,000 |  |  |  |  |  | (61,170)
07/23/2015 |  | Export prepayments in US$ to third parties |  | Part of the highly probable future monthly iron ore exports |  | Foreign exchange - R$ vs. US$ spot rate |  | October 2018 - October 2022 |  | 3.2850 |  | 30,000 |  | (6,000) |  |  |  | (14,681)
07/24/2015 |  | Export prepayments in US$ to third parties |  | Part of the highly probable future monthly iron ore exports |  | Foreign exchange - R$ vs. US$ spot rate |  | October 2018 - October 2022 |  | 3.3254 |  | 100,000 |  | (20,000) |  |  |  | (45,704)
07/27/2015 |  | Export prepayments in US$ to third parties |  | Part of the highly probable future monthly iron ore exports |  | Foreign exchange - R$ vs. US$ spot rate |  | October 2018 - October 2022 |  | 3.3557 |  | 25,000 |  | (5,000) |  |  |  | (10,820)
07/27/2015 |  | Export prepayments in US$ to third parties |  | Part of the highly probable future monthly iron ore exports |  | Foreign exchange - R$ vs. US$ spot rate |  | October 2018 - October 2022 |  | 3.3557 |  | 70,000 |  | (14,000) |  |  |  | (30,296)
07/27/2015 |  | Export prepayments in US$ to third parties |  | Part of the highly probable future monthly iron ore exports |  | Foreign exchange - R$ vs. US$ spot rate |  | October 2018 - October 2022 |  | 3.3557 |  | 30,000 |  | (6,000) |  |  |  | (12,984)
07/28/2015 |  | Export prepayments in US$ to third parties |  | Part of the highly probable future monthly iron ore exports |  | Foreign exchange - R$ vs. US$ spot rate |  | October 2018 - October 2022 |  | 3.3815 |  | 30,000 |  | (6,000) |  |  |  | (12,365)
3/8/2015 |  | Export prepayments in US$ to third parties |  | Part of the highly probable future monthly iron ore exports |  | Foreign exchange - R$ vs. US$ spot rate |  | October 2018 - October 2022 |  | 3.3940 |  | 355,000 |  | (11,998) |  |  |  | (172,427)
2/4/2018 |  | Bonds |  | Part of the highly probable future monthly iron ore exports |  | Foreign exchange - R$ vs. US$ spot rate |  | July 2018 - February 2023 |  | 3.3104 |  | 1,170,045 |  | (307,000) |  | (42,188) |  | (506,008)
Total |  |  |  |  |  |  |  |  |  |  |  | 2,745,045 |  | (882,821) |  | (184,217) |  | (1,275,518)

(*) The effect on profit or loss was recognized in other operating expenses.

In the hedging relationships described above, the amounts of the debt instruments were fully designated for equivalent iron ore export portions.

The movement in hedge accounting amounts recognized in shareholders’ equity as of March 31, 2019 is as follows:

| 12/31/2018 |  | Movement |  | Realization |  | 03/31/2019
Cash flow hedge accounting | 1,441,295 |  | 18,440 |  | (184,217) |  | 1,275,518
Fair value of cash flow hedge, net of taxes | 1,441,295 |  | 18,440 |  | (184,217) |  | 1,275,518

As of March 31, 2019, the hedging relationships established by the Company were effective, according to prospective and retrospective tests conducted. Thus, no reversal for hedge accounting ineffectiveness was recognized in the quarter.

· Hedge of net investment in foreign operation

CSN has a natural currency exposure in Euros substantially arising from a borrowing taken by a foreign subsidiary with functional currency in Reais, for the acquisition of investments abroad where the functional currency is Euro. Such exposure arises from translating the balance sheets of these subsidiaries for consolidation into CSN, where the exchange difference on the borrowings affected the statement of income, in the financial income (expenses) line item, and the exchange difference on the net assets of the foreign operation directly affected the shareholders equity, in other comprehensive income.

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As from September 1, 2015, CSN began to adopt the net investment hedge to eliminate such exposure and cover future fluctuations of the Euro on such borrowings. Non-derivative financial liabilities were designated, represented by borrowing agreements with financial institutions in the amount of € 120 million. The account balances as of March 31, 2019 are as follows:

|  |  |  |  |  |  |  |  |  |  |  | 03/31/2018
Designation Date |  | Hedging Instrument |  | Hedged item |  | Type of hedged risk |  | Exchange rate on designation |  | Designated amounts (EUR'000) |  | Amortized part (USD’000) | Impact on shareholders' equity
09/01/2015 |  | Non-derivative financial liabilities in EUR – Debt contract |  | Investments in subsidiaries which EUR is the functional currency |  | Foreign exchange - R$ vs. EUR spot rate |  | 4.0825 |  | 120,000 |  | (96,000) | (2,239)
Total |  |  |  |  |  |  |  |  |  | 120,000 |  | (96,000) | (2,239)

The movement in the amounts related to net investment hedge recognized in shareholders’ equity as of March 31, 2019 is as follows:

| 12/31/2018 |  | Movement |  |  | 03/31/2019
Net Investment hedge accounting | 3,941 |  | (6,180) |  |  | (2,239)
Fair value of net investment hedge in foreign operations | 3,941 |  | (6,180) |  |  | (2,239)

As of March 31, 2019, the hedging relationships established by the Company were effective, according to prospective tests conducted. Therefore, no reversal for hedge ineffectiveness was recognized.

13.c) Sensitivity analysis

We present below the sensitivity analysis of foreign exchange rate and interest rate risks.

· Sensitivity analysis of derivative financial instruments and consolidated foreign exchange exposure

The Company considered scenarios 1 and 2 as 25% and 50% deterioration for currency volatility using as reference the closing exchange rate as of March 31, 2019.

The currencies used in the sensitivity analysis and their scenarios are shown below:

|  |  |  |  |  |  |  | 03/31/2019
Currency |  | Exchange rate |  | Probable scenario |  | Scenario 1 |  | Scenario 2
USD |  | 3,8967 |  | 3,9436 |  | 4,8709 |  | 5,8451
EUR |  | 4,3760 |  | 4,4224 |  | 5,4700 |  | 6,5640
USD x EUR |  | 1,1235 |  | 1,1245 |  | 1,4044 |  | 1,6853
|  |  |  |  |  | 03/31/2019 |  |
Interest |  | Interest rate |  | Scenario 1 |  | Scenario 2 |  |
CDI |  | 6,40% |  | 8,00% |  | 9,60% |  |
TJLP |  | 7,03% |  | 8,79% |  | 10,55% |  |
Libor |  | 2,66% |  | 3,32% |  | 3,99% |  |

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The effects on profit or loss, considering scenarios 1 and 2, are shown below:

|  |  |  |  |  |  |  |  |  | 03/31/2019
Instruments |  | Notional |  | Risk |  | Probable scenario (*) |  | Scenario 1 |  | Scenario 2
Hedge accounting of exports |  | 1,862,224 |  | Dólar |  | 87,338 |  | 1,814,132 |  | 3,628,264
Currency position |  | (3,588,557) |  | Dólar |  | (168,303) |  | (3,495,883) |  | (6,991,766)
(not including exchange derivatives above) |  |  |  |  |  |  |  |  |  |
Consolidated exchange position |  | (1,726,333) |  | Dólar |  | (80,965) |  | (1,681,751) |  | (3,363,502)
(including exchange derivatives above) |  |  |  |  |  |  |  |  |  |
Net Investment hedge accounting |  | 24,000 |  | Euro |  | 1,114 |  | 26,256 |  | 52,512
Currency position |  | (23,277) |  | Euro |  | (1,080) |  | (25,465) |  | (50,930)
Consolidated exchange position |  | 723 |  | Euro |  | 34 |  | 791 |  | 1,582
(including exchange derivatives above) |  |  |  |  |  |  |  |  |  |
Dollar-to-euro swap |  | 1,262 |  | Dólar |  | 7 |  | 986 |  | 1,641

(*) The probable scenarios were calculated considering the following variations for the risks: Real x Dollar – depreciation of Real by 1.20% / Real x Euro – depreciation of Real by 1.06%. Euro x Dólar - depreciation of Euro by 0.09%. Source: quotations from Central Bank of Brazil and European Central Bank on 04/23/2019.

· Sensitivity analysis of changes in interest rates

The Company considered scenarios 1 and 2 as 25% and 50% of changes in interest volatility as of March 31, 2019.

|  |  |  |  |  |  |  |  |  | Consolidated
|  |  |  |  |  |  |  |  |  | Impact on profit or loss
Changes in interest rates |  | % p.a |  | Assets |  | Liabilities |  | Probable scenario (*) |  | Scenario 1 |  | Scenario 2
TJLP |  | 7,03 |  |  |  | (920,280) |  | (2,938) |  | (16,174) |  | (32,348)
Libor |  | 2,66 |  |  |  | (4,748,778) |  | (71,638) |  | (31,573) |  | (63,146)
CDI |  | 6,40 |  | 2,140,113 |  | (11,333,373) |  | (39,171) |  | (147,092) |  | (294,184)

(*) The sensitivity analysis assumes of maintaining as a probable scenario the market values as of March 31, 2019 recognized in the company's assets and liabilities.

13.d) Liquidity risk

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It is the risk that the Company does not have enough liquid resources to honor its financial commitments, because of mismatching of term or volume between expected receipts and payments.

To manage the liquidity of the cash in local and foreign currency, premises of disbursements and future receipts are established, being monitored daily by the Treasury area. The payment schedules for the long-term portions of the loans and financing and debentures are presented in Note 12.

The following table shows the contractual maturities of financial liabilities and lease liabilities, including accrued interest.

|  |  |  |  |  |  | Consolidated
At March 31, 2019 | Less than one year |  | From one to two years |  | From two to five years |  | Over five years |  | Total
Borrowings, financing and debentures (note 12) | 5,447,583 |  | 8,895,328 |  | 9,623,536 |  | 4,470,967 |  | 28,437,414
Leases (note 14 a) | 45,742 |  | 160,384 |  | 240,576 |  | 186,536 |  | 633,238
Derivative financial instruments (note 13 I) | 3 |  |  |  |  |  |  |  | 3
Trade payables (note 13 I) | 3,228,213 |  |  |  |  |  |  |  | 3,228,213
Trade payables – Drawee risk (note 13 I) | 300,947 |  |  |  |  |  |  |  | 300,947

IV - Fair values of assets and liabilities as compared to their carrying amounts

Financial assets and liabilities measured at fair value through profit or loss are recorded in current and noncurrent assets and liabilities and gains and losses are recorded as financial income and expenses, respectively.

The amounts are recorded in the financial statements at their carrying amount, which are substantially similar to those that would be obtained if they were traded in the market. The fair values of other long-term assets and liabilities do not differ significantly from their carrying amounts, except for the amounts below.

The estimated fair values for certain consolidated long-term borrowings and financing were calculated at prevailing market rates, taking into consideration the nature, terms and risks similar to those of the recorded contracts, according below:

|  |  | 03/31/2019 |  |  |  | 12/31/2018
| Closing Balance |  | Fair value |  | Closing Balance |  | Fair value
Perpetual bonds | 3,902,004 |  | 3,378,781 |  | 3,880,074 |  | 2,850,615
Fixed Rate Notes | 6,670,258 |  | 7,178,616 |  | 6,745,132 |  | 7,595,765

(*) Source: Bloomberg

• Credit Risks

The exposure to credit risks of financial institutions complies with the parameters established in the financial policy. The Company has as practice the detailed analysis of the patrimonial and financial situation of its clients and suppliers, the establishment of a credit limit and the permanent monitoring of its outstanding balance.

With respect to financial investments, the Company only makes investments in institutions with low credit risk rated by rating agencies. Since part of the funds is invested in repo operations that are backed by Brazilian government bonds, there is also exposure to the credit risk of the Brazilian State.

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Regarding the exposure to credit risk in accounts receivable and other receivables, the Company has a credit risk committee, in which each new customer is analyzed individually regarding their financial condition, before granting the credit limit and payment terms and periodically revised, according to the periodicity procedures of each business area.

• Capital Management

The Company seeks to optimize its capital structure in order to reduce its financial costs and maximize the return to its shareholders. The table below shows the evolution of the Company's consolidated capital structure, with financing by equity and third-party capital:

Thousands of reais |  | 03/31/2019 |  | 03/31/2018
Shareholder's equity (equity) |  | 10,250,388 |  | 10,013,440
Borrowings and Financing (Third-party capital) |  | 28,302,694 |  | 28,827,074
Gross Debit/Shareholder's equity |  | 2.76 |  | 2.88

14. OTHER PAYABLES

The group of other payables classified in current and noncurrent liabilities is comprised as follows:

|  |  |  |  |  |  | Consolidated |  |  |  |  |  |  |  | Parent Company
| Current | Non-current | Current | Non-current
| 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Payables to related parties (note 18 a) | 22,773 |  | 35,499 |  | 79,182 |  | 96,629 |  | 316,421 |  | 308,056 |  |  |  | 14,501
Dividends and interest on capital payable (Note 13 I) | 932,005 |  | 932,005 |  |  |  |  |  | 900,541 |  | 900,541 |  |  |  |
Advances from customers (1) | 563,002 |  | 137,418 |  | 1,469,166 |  |  |  | 75,843 |  | 64,416 |  |  |  |
Taxes in installments | 19,644 |  | 20,179 |  | 72,452 |  | 73,934 |  | 9,767 |  | 9,756 |  | 2,273 |  | 2,378
Profit sharing - employees | 154,231 |  | 113,219 |  |  |  |  |  | 96,431 |  | 72,555 |  |  |  |
Taxes payable |  |  |  |  | 8,646 |  | 8,631 |  |  |  |  |  | 7,159 |  | 7,145
Provision for consumption and services | 343,491 |  | 334,638 |  |  |  |  |  | 280,446 |  | 260,942 |  |  |  |
Third party materials in our possession | 74,597 |  | 45,915 |  |  |  |  |  | 74,366 |  | 45,721 |  |  |  |
Trade payables - drawee risk (2) | 300,947 |  | 65,766 |  |  |  |  |  | 300,947 |  | 65,766 |  |  |  |
Lease Liabilities (note 14 a) | 45,742 |  |  |  | 587,496 |  |  |  | 20,453 |  |  |  | 35,271 |  |
Other payables | 74,311 |  | 85,984 |  | 42,230 |  | 48,134 |  | 17,114 |  | 17,551 |  |  |  |
| 2,530,746 |  | 1,770,623 |  | 2,259,172 |  | 227,328 |  | 2,092,329 |  | 1,745,304 |  | 44,703 |  | 24,024

(1) Glencore Advance: On March 29, 2019, the Company received in advance through its subsidiary CSN Mineração the amount of U $ 496 million (R $ 1,951 billion) related to a supply contract of approximately 22 million tons of ore to the Swiss trader Glencore International AG ("Glencore"), to be executed within 5 years.

(2) Trade Payables – Drawee risk: The Company negotiated with financial institutions to anticipate payments from its suppliers, with the objective of lengthening the deadlines. This financial modality is an option of suppliers, and does not require mandatory participation, nor is the Company not reimbursed and / or benefited by the financial institution of discounts for payment executed before the due date agreed with the supplier, there is no change in the degree of subordination of the security in case of judicial execution and no changes in the commercial conditions existing between the Company and its suppliers. The balance on March 31, 2019 of suppliers that benefited from this modality corresponds to R $ 300,947 (R $ 65,766 on December 31, 2018).

14.a.) LEASE LIABILITIES

In the quarter, the lease liabilities are presented as follows:

|  |  | Consolidated |  |  |  | Parent Company
| 03/31/2019 |  | First adoption |  | 03/31/2019 |  | First adoption
Leases | 1,521,765 |  | 1,533,556 |  | 64,801 |  | 71,114
Present value adjustment - Leases | (888,527) |  | (892,567) |  | (9,077) |  | (10,042)
| 633,238 |  | 640,989 |  | 55,724 |  | 61,072
Classified: |  |  |  |  |  |  |
Current | 45,742 |  | 39,243 |  | 20,453 |  | 21,390
Non-current | 587,496 |  | 601,746 |  | 35,271 |  | 39,682
| 633,238 |  | 640,989 |  | 55,724 |  | 61,072

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The Company has lease agreements for port operations, machinery and facilities, vehicles, administrative and operational real estate. Lease liabilities are guarantee by the underlying assets. The amount of interest recognized in the financial result for the period ended March 31, 2019 in the consolidated was R$4,9 million and in the parent company was R$ 965 thousand.

The minimum future lease payments as of March 31, 2019 are as follows:

|  |  |  |  |  |  | Consolidated
| Less than one year |  | Between one and five years |  | Over five years |  | Total
Leases | 80,211 |  | 968,970 |  | 472,584 |  | 1,521,765
Present value adjustment - Leases | (34,469) |  | (568,010) |  | (286,048) |  | (888,527)
| 45,742 |  | 400,960 |  | 186,536 |  | 633,238

· Payments of leases not recognized as liabilities:

The Company chose not to recognize lease liabilities in contracts with a maturity of less than twelve months and for assets with low value.

The payments made for these contracts and for the variable portion of the lease agreements are recognized as expenses when incurred.

Expenses related to payments not included in the measurement of a lease liability are:

| Consolidated |  | Parent Company
| 03/31/2019 |  | 03/31/2019
Contract less than 12 months | 3,244 |  |
Lower Assets value | 426 |  |
Variable lease payments | 39,675 |  | 1,593
| 43,345 |  | 1,593

15. INCOME TAX AND SOCIAL CONTRIBUTION

15.a) Income tax and social contribution recognized in profit or loss:

The income tax and social contribution recognized in profit or loss for the year are as follows:

|  |  | Consolidated |  | Parent Company
| 03/31/2019 |  | 03/31/2018 |  | 03/31/2019 |  | 03/31/2018
Income tax and social contribution income (expense) |  |  |  |  |  |  |
Current | (369,818) |  | (119,914) |  | 11 |  |
Deferred | (89,039) |  | (438,797) |  | (45,256) |  | (459,650)
| (458,857) |  | (558,711) |  | (45,245) |  | (459,650)

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The reconciliation of consolidated and parent company income tax and social contribution expenses and the result from applying the tax rate to profit before income tax and social contribution are as follows:

| Consolidated | Parent Company |
| 03/31/2019 |  | 03/31/2018 |  | 03/31/2019 |  | 03/31/2018
Profit before income tax and social contribution | 545,620 |  | 2,045,206 |  | 37,673 |  | 1,931,513
Tax rate | 34% |  | 34% |  | 34% |  | 34%
Income tax and social contribution at combined statutory rate | (185,511) |  | (695,370) |  | (12,809) |  | (656,714)
Adjustment to reflect the effective rate: |  |  |  |  |  |  |
Equity in results of affiliated companies | 9,782 |  | 9,448 |  | 186,820 |  | 8,798
Profit with differentiated rates or untaxed | (47,576) |  | (42,380) |  |  |  |
Transfer pricing adjustment | (8,574) |  | (9,546) |  |  |  |
Tax loss carryforwards without recognizing deferred taxes | (8,866) |  | (9,451) |  |  |  |
Indebtdness limit | (6,715) |  | (7,800) |  | (6,715) |  | (7,800)
Unrecorded deferred taxes on temporary differences | (2,735) |  | 470 |  |  |  |
(Losses)/Reversal for deferred income and social contribution tax credits | (211,848) |  | 193,827 |  | (211,848) |  | 193,827
Deferred taxes on foreign profit | (14) |  | (554) |  |  |  |
Tax incentives | 7,462 |  | 1,379 |  |  |  |
Other permanent deductions (additions) | (4,262) |  | 1,266 |  | (693) |  | 2,239
Income tax and social contribution in profit for the period | (458,857) |  | (558,711) |  | (45,245) |  | (459,650)
Effective tax rate | 84% |  | 27% |  | 120% |  | 24%

15.b) Deferred income tax and social contribution:

Deferred income tax and social contribution are calculated on income tax and social contribution losses and the corresponding temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements:

|  |  |  |  |  |  | Consolidated
| Opening balance |  | Movement |  | Closing balance
| 12/31/2018 |  | Shareholders' Equity |  | P&L |  | Others |  | 03/31/2019
Deferred |  |  |  |  |  |  |  |  |
Income tax losses | 959,240 |  |  |  | 199,883 |  | 6,408 |  | 1,165,531
Social contribution tax losses | 367,358 |  |  |  | 71,959 |  | 2,492 |  | 441,809
Temporary differences | (1,838,935) |  | 2,934 |  | (360,881) |  | (8,900) |  | (2,205,782)
- Provision for tax. social security, labor, civil and environmental risks | 267,237 |  |  |  | (41,056) |  |  |  | 226,181
- Provision for environmental liabilities | 67,143 |  |  |  | (2,105) |  |  |  | 65,038
- Asset impairment losses | 81,341 |  |  |  | (4,558) |  |  |  | 76,783
- Inventory impairment losses | 38,760 |  |  |  | 568 |  |  |  | 39,328
- (Gains)/losses on financial instruments | (3,319) |  |  |  | (1,367) |  |  |  | (4,686)
- (Gains)/losses on financial assets recognized at fair value thought profit or loss. | 363,095 |  |  |  | (43,402) |  |  |  | 319,693
- Actuarial liability (pension and healthcare plan) | 276,032 |  |  |  |  |  |  |  | 276,032
- Accrued supplies and services | 95,644 |  |  |  | 5,466 |  |  |  | 101,110
- Allowance for doubtful debts | 61,415 |  |  |  | (7,230) |  |  |  | 54,185
- Unrealized exchange differences (1) | 1,010,532 |  |  |  | (11,662) |  |  |  | 998,870
- (Gain) on loss of control over Transnordestina | (92,180) |  |  |  |  |  |  |  | (92,180)
- Cash flow hedge accounting | 490,041 |  | (56,364) |  |  |  |  |  | 433,677
- Aquisition Fair Value SWT/CBL | (172,114) |  | 2,050 |  | 5,994 |  |  |  | (164,070)
- Deferred taxes non computed | (252,940) |  |  |  | (11,326) |  | (8,900) |  | (273,166)
- Estimated (Losses)/ reversals to deferred taxes credits | (3,086,572) |  | 56,364 |  | (211,848) |  |  |  | (3,242,056)
- Business Combination | (1,030,812) |  |  |  | 1,836 |  |  |  | (1,028,976)
- Others | 47,762 |  | 884 |  | (40,191) |  |  |  | 8,455
Total | (512,337) |  | 2,934 |  | (89,039) |  |  |  | (598,442)
Total Deferred Assets | 89,394 |  |  |  |  |  |  |  | 69,465
Total Deferred Liabilities | (601,731) |  |  |  |  |  |  |  | (667,907)
Total Deferred | (512,337) |  |  |  |  |  |  |  | (598,442)

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(1) The Company taxes exchange differences on a cash basis to calculate income tax and social contribution on net income.

|  |  |  |  |  |  | Parent Company
| Opening balance |  | Movement | Closing balance
| 12/31/2018 |  | Shareholders' Equity |  | P&L |  | 03/31/2019
Deferred tax assets |  |  |  |  |  |  |
Income tax losses | 834,141 |  |  |  | 192,634 |  | 1,026,775
Social contribution tax losses | 322,283 |  |  |  | 69,348 |  | 391,631
Temporary differences | (1,173,858) |  |  |  | (307,238) |  | (1,481,096)
- Provision for tax. social security, labor, civil and environmental risks | 210,382 |  |  |  | (41,129) |  | 169,253
- Provision for environmental liabilities | 64,906 |  |  |  | (1,776) |  | 63,130
- Asset impairment losses | 57,444 |  |  |  | (4,469) |  | 52,975
- Inventory impairment losses | 15,326 |  |  |  | (521) |  | 14,805
(Gain)/loss in financial instruments | (3,319) |  |  |  | (1,367) |  | (4,686)
- (Gains)/losses on financial assets measured at fair value through profit or loss | 363,095 |  |  |  | (43,402) |  | 319,693
- Actuarial liability (pension and healthcare plan) | 279,132 |  |  |  |  |  | 279,132
- Accrued supplies and services | 84,509 |  |  |  | 5,123 |  | 89,632
- Allowance for doubtful debts | 45,565 |  |  |  | (7,341) |  | 38,224
- Unrealized ex change differences (1) | 1,014,309 |  |  |  | (11,447) |  | 1,002,862
- (Gain) on loss of control over Transnordestina | (92,180) |  |  |  |  |  | (92,180)
- Cash flow hedge accounting | 490,041 |  | (56,364) |  |  |  | 433,677
- Estimated (losses)/ reversals to deferred taxes credits | (3,086,572) |  | 56,364 |  | (211,848) |  | (3,242,056)
- Business Combination | (699,383) |  |  |  |  |  | (699,383)
- Deferred Income and social contribution on Business Combination of CGPAR | (22,609) |  |  |  |  | (22,609)
- Other | 105,496 |  |  |  | 10,939 |  | 116,435
Total | (17,434) |  |  |  | (45,256) |  | (62,690)
Deferred tax liabilities | (17,434) |  |  |  |  |  | (62,690)
Total | (17,434) |  |  |  |  |  | (62,690)

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(1) The Company taxes exchange differences on a cash basis to calculate income tax and social contribution.

In its corporate structure, the Company has foreign subsidiaries whose profits are subject to income tax in the countries where they were established at rates lower than those prevailing in Brazil. In the period from 2014 to 2019, these foreign subsidiaries generated profits amounting to R$ 1,150,443. If the tax authorities understand that these profits are subject to additional taxation in Brazil in respect of income tax and social contribution, these, if due, would total approximately R$ 366,847.

The Company, based on its legal counsel’s opinion, assessed as possible the likelihood of loss in the event of challenge by the tax authorities and, therefore, no provision was recognized in the financial statements.

15.c) Income tax and social contribution recognized in shareholders' equity:

The income tax and social contribution recognized directly in shareholders' equity are as follows:

| Consolidated |  | Parent Company
| 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Income tax and social contribution |  |  |  |  |  |  |
Actuarial gains on defined benefit pension plan | 176,730 |  | 176,700 |  | 180,048 |  | 180,048
Estimated losses for deferred income and social contribution tax credits - actuarial gains | (180,048) |  | (180,048) |  | (180,048) |  | (180,048)
Exchange differences on translating foreign operations | (325,350) |  | (325,350) |  | (325,350) |  | (325,350)
Cash flow hedge accounting | 433.677 |  | 490.041 |  | 433.677 |  | 490.041
Estimated losses for deferred income and social contribution tax credits - cash flow hedge | (433.677) |  | (490.041) |  | (433.677) |  | (490.041)
| (328.668) |  | (328.698) |  | (325.350) |  | (325.350)

16. PROVISION FOR TAX, SOCIAL SECURITY, LABOR, CIVIL AND ENVIRONMENTAL RISKS AND JUDICIAL DEPOSITS

Are being discussed in the competent spheres, actions and complaints of various natures. The details of the provisioned amounts and the related judicial deposits are presented below:

|  |  |  |  |  | Consolidated |  |  |  |  |  | Parent Company
|  | Accrued liabilities |  | Judicial deposits |  | Accrued liabilities |  | Judicial deposits
|  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Tax |  | 118,123 |  | 118,490 |  | 52,371 |  | 46,321 |  | 48,287 |  | 48,789 |  | 34,216 |  | 27,493
Social security |  | 68,938 |  | 70,084 |  | 50,898 |  | 50,898 |  | 68,397 |  | 67,978 |  | 50,898 |  | 50,898
Labor |  | 348,209 |  | 362,228 |  | 219,592 |  | 214,625 |  | 261,151 |  | 277,590 |  | 167,249 |  | 162,870
Civil |  | 151,384 |  | 210,264 |  | 22,706 |  | 22,024 |  | 124,398 |  | 180,546 |  | 12,553 |  | 11,871
Environmental |  | 34,857 |  | 31,390 |  | 2,084 |  | 1,900 |  | 31,271 |  | 28,030 |  | 2,084 |  | 1,900
Deposit of a guarantee |  |  |  |  |  | 11,716 |  | 12,182 |  |  |  |  |  |  |  | 563
|  | 721,511 |  | 792,456 |  | 359,367 |  | 347,950 |  | 533,504 |  | 602,933 |  | 267,000 |  | 255,595

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Classification |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current |  | 106,140 |  | 106,503 |  |  |  |  |  | 63,839 |  | 64,856 |  |  |  |
Non-current |  | 615,371 |  | 685,953 |  | 359,367 |  | 347,950 |  | 469,665 |  | 538,077 |  | 267,000 |  | 255,595
|  | 721,511 |  | 792,456 |  | 359,367 |  | 347,950 |  | 533,504 |  | 602,933 |  | 267,000 |  | 255,595

The movement in the provision for tax, social security, labor, civil and environmental risks in the period ended March 31, 2019 is as follows:

|  |  |  |  |  |  |  |  |  | Consolidated
|  |  |  |  |  |  |  |  |  | Current + Non-current
Nature |  | 12/31/2018 |  | Additions |  | Net update on amount |  | Net utilization of reversal |  | 03/31/2019
Tax |  | 118,490 |  | 16,815 |  | 1,006 |  | (18,188) |  | 118,123
Social security |  | 70,084 |  | 2,419 |  | 363 |  | (3,928) |  | 68,938
Labor |  | 362,228 |  | 7,613 |  | 20,304 |  | (41,936) |  | 348,209
Civil |  | 210,264 |  | 8,566 |  | 4,612 |  | (72,058) |  | 151,384
Environmental |  | 31,390 |  | 670 |  | 2,842 |  | (45) |  | 34,857
|  | 792,456 |  | 36,083 |  | 29,127 |  | (136,155) |  | 721,511

|  |  |  |  |  |  |  | Parent Company
|  |  |  |  |  |  |  |  |  | Current + Non-current
Nature |  | 12/31/2018 |  | Additions |  | Net update on amount |  | Net utilization of reversal |  | 03/31/2019
Tax |  | 48,789 |  | 14,740 |  | 328 |  | (15,570) |  | 48,287
Social security |  | 67,978 |  | 1,878 |  | 363 |  | (1,822) |  | 68,397
Labor |  | 277,590 |  | 6,019 |  | 13,860 |  | (36,318) |  | 261,151
Civil |  | 180,546 |  | 8,058 |  | 3,477 |  | (67,683) |  | 124,398
Environmental |  | 28,030 |  | 670 |  | 2,615 |  | (44) |  | 31,271
|  | 602,933 |  | 31,365 |  | 20,643 |  | (121,437) |  | 533,504

The provision for tax, social security, labor, civil and environmental risks was estimated by Management and is mainly based on the legal counsel’s assessment. Only lawsuits for which the risk is classified as probable loss are provisioned. Additionally, this tax provisions, subject to SELIC (Central Bank’s policy rate).

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§ Possible administrative and judicial proceedings

The table below shows a summary of the main matters classified as possible risk compared with the balances as of March 31, 2019 and December 31, 2018.

|  | 03/31/2019 |  | 12/31/2018
Income tax / Social contribution - Assessment Notice and imposition of fine (AIIM) - Capital gain for an alleged sale of the shares of its subsidiary NAMISA. |  | 11,953,102 |  | 11,812,071
Notice of Infringement and Fine Taxation - Income taxes and Social contribution - Glossary of goodwill deductions generated by the reverse merger of Big Jump by NAMISA |  | 3,756,021 |  | 3,722,888
Assessment Notice and Imposition of fine (AIIM) - Income tax/ Social contribution - gloss of interest on prepayment arising from supply contracts of iron ore and port services |  | 2,184,465 |  | 2,165,088
Notices of violation and imposition of fine - Income taxes and social contribution due to profits from foreign subsidiaries (years 2008,2010 and 2011) (1) |  | 1,905,190 |  | 1,891,149
Tax foreclosures - ICMS - Electricity credits |  | 985,687 |  | 974,479
Offset of taxes that were not approved by the Federal Revenue Service - IRPJ/CSLL, PIS/COFINS e IPI |  | 1,614,883 |  | 1,481,382
Disallowance of the ICMS credits - Transfer of iron ore |  | 535,571 |  | 529,607
ICMS - Refers to the transfer of imported raw material at an amount lower than the price disclosed in the import documentation |  | 298,256 |  | 294,527
Disallowance of the tax losses arising on adjustments to the SAPLI |  | 521,586 |  | 516,583
Assessment Notice- Income tax- Capital Gain of CFM vendors located outside |  | 245,777 |  | 243,007
CFEM - Divergence on the understanding between CSN and DNPM on the calculation basis |  | 315,673 |  | 311,582
Infraction Notice - ICMS - Question on sales to Incentivized Zone |  | 986,214 |  | 976,438
Other tax (federal, state, and municipal) lawsuits |  | 3,593,808 |  | 3,625,167
Social security lawsuits |  | 289,676 |  | 287,823
Law suit applied by Brazilian antitrust authorities (CADE) |  | 102,743 |  | 101,683
Other civil lawsuits |  | 965,151 |  | 922,171
Labor and social security lawsuits |  | 1,567,554 |  | 1,537,078
Tax foreclosures - Fine of Volta Grande IV |  | 79,984 |  | 75,530
Others Enviromental lawsuits |  | 167,787 |  | 144,235
|  | 32,069,128 |  | 31,612,488

The assessments made by the legal counsel define these administrative and judicial proceedings as entailing risk of possible loss and, therefore, no provision was recognized in conformity with Management’s judgment and accounting practices adopted in Brazil.

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17. PROVISION FOR ENVIRONMENTAL LIABILITIES AND ASSET RETIREMENT OBLIGATIONS

The information on provision for environmental liabilities and asset retirement obligations has not changed in relation to that disclosed in the Company's financial statements as of December 31, 2018 and, accordingly, the Company decided not to repeat it in the condensed interim financial information as of March 31, 2019.

The balance of the provision for environmental liabilities and asset retirement obligation (ARO) is as follows:

|  |  | Consolidated |  |  |  | Parent Company
| 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Environmental liabilities | 192,175 |  | 198,386 |  | 185,991 |  | 191,216
Asset retirement obligations | 97,183 |  | 83,380 |  | 735 |  | 668
| 289,358 |  | 281,766 |  | 186,726 |  | 191,884

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18. RELATED-PARTY BALANCES AND TRANSACTIONS

The information on related-party transactions has not changed significantly in relation to that disclosed in the Company's financial statements as of December 31, 2018.

18.a) Transactions with subsidiaries, joint ventures, associates, exclusive funds and other related parties

· By transaction

Consolidated

|  | Current | Non-current | Total
|  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2018 |  | 12/31/2017 |  | 03/31/2018 |  | 12/31/2017
Assets |  |  |  |  |  |  |  |  |  |  |  |
Trade receivables(note 6) |  | 185,600 |  | 93,317 |  |  |  |  |  | 185,600 |  | 93,317
Dividends receivable (note 8) |  | 48,315 |  | 46,171 |  |  |  |  |  | 48,315 |  | 46,171
Actuarial asset (note 8) |  |  |  |  |  | 93,757 |  | 99,894 |  | 93,757 |  | 99,894
Financial investments/ investments |  | 100,871 |  | 92,332 |  |  |  |  |  | 100,871 |  | 92,332
Loans (note 8) |  | 2,710 |  | 2,675 |  | 744,364 |  | 706,605 |  | 747,074 |  | 709,280
Other receivables (note 8) |  | 3,202 |  | 3,649 |  | 218,840 |  | 218,840 |  | 222,042 |  | 222,489
|  | 340,698 |  | 238,144 |  | 1,056,961 |  | 1,025,339 |  | 1,397,659 |  | 1,263,483
Liabilities |  |  |  |  |  |  |  |  |  |  |  |
Other payables (Note 14) |  |  |  |  |  |  |  |  |  |  |  |
Accounts payable |  | 21,182 |  | 29,286 |  | 79,182 |  | 96,629 |  | 100,364 |  | 125,915
Accrued supplies and services |  | 1,591 |  | 6,213 |  |  |  |  |  | 1,591 |  | 6,213
Trade payables |  | 118,329 |  | 135,801 |  |  |  |  |  | 118,329 |  | 135,801
Actuarial liabilities |  |  |  |  |  | 7,982 |  | 7,982 |  | 7,982 |  | 7,982
|  | 141,102 |  | 171,300 |  | 87,164 |  | 104,611 |  | 228,266 |  | 275,911

| 03/31/2019 |  | 03/31/2018 |
P&L |  |  |  |
Revenues |  |  |  |
Sales | 264,366 |  | 293,123 |
Interest (note 24) | 20,161 |  | 14,225 |
Foreign exchange and monetary variations, net | 504 |  |  |
Expenses |  |  |  |
Purchases | (345,387) | (295,724) |
Interest (note 24) | (3,735) |  |  |
Foreign exchange and monetary variations, net |  |  |  |
| (64,091) |  | 11,624 |

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· By company

|  |  |  |  |  |  |  |  |  | Consolidated
|  | Assets |  | Liabilities |  | P&L
| Current |  | Non-current |  | Total |  | Current |  | Non-current |  | Total |  | Sales |  | Purchases |  | Finance income(expenses),net |  | Exchange rate variations, net |  | Total
Joint-venture and Joint-operation |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Itá Energética S.A. |  |  |  |  |  |  |  | 2,550 |  |  |  | 2,550 |  |  |  |  |  |  |  |  |  |
MRS Logística S.A. |  | 46,169 |  |  |  | 46,169 |  | 50,195 |  | 79,182 |  | 129,377 |  |  |  | (263,965) |  | (3,736) |  |  |  | (267,701)
CBSI - Companhia Brasileira de Serviços e Infraestrutura |  | 2,149 |  |  |  | 2,149 |  | 33,501 |  |  |  | 33,501 |  | 8 |  | (49,871) |  |  |  |  |  | (49,863)
Transnordestina Logística S.A (1) |  | 1,511 |  | 963,204 |  | 964,715 |  | 560 |  |  |  | 560 |  | 196 |  | (2,021) |  | 13,887 |  |  |  | 12,062
|  | 49,829 |  | 963,204 |  | 1,013,033 |  | 86,806 |  | 79,182 |  | 165,988 |  | 204 |  | (315,857) |  | 10,151 |  |  |  | (305,502)
Other related parties |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
CBS Previdência |  |  |  | 93,757 |  | 93,757 |  |  |  | 7,982 |  | 7,982 |  |  |  |  |  |  |  |  |  |
Banco Fibra (2) |  | 100,871 |  |  |  | 100,871 |  |  |  |  |  |  |  |  |  |  |  | 6,215 |  | 504 |  | 6,719
Usiminas |  |  |  |  |  |  |  | 34,376 |  |  |  | 34,376 |  |  |  | (9) |  |  |  |  |  | (9)
Panatlântica (3) |  | 140,748 |  |  |  | 140,748 |  | 19,325 |  |  |  | 19,325 |  | 262,931 |  | (26,213) |  |  |  |  |  | 236,718
Ibis Participações e Serviços |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (275) |  |  |  |  |  | (275)
Other related parties |  | 2,185 |  |  |  | 2,185 |  | 595 |  |  |  | 595 |  | 1,231 |  | (3,033) |  |  |  |  |  | (1,802)
|  | 243,804 |  | 93,757 |  | 337,561 |  | 54,296 |  | 7,982 |  | 62,278 |  | 264,162 |  | (29,530) |  | 6,215 |  | 504 |  | 241,351
Associates |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Arvedi Metalfer do Brasil S.A. |  | 47,065 |  |  |  | 47,065 |  |  |  |  |  |  |  |  |  |  |  | 60 |  |  |  | 60
Total at 3/31/2019 |  | 340,698 |  | 1,056,961 |  | 1,397,659 |  | 141,102 |  | 87,164 |  | 228,266 |  | 264,366 |  | (345,387) |  | 16,426 |  | 504 |  | (64,091)
Total em 12/31/2018 |  | 238,144 |  | 1,025,339 |  | 1,263,483 |  | 171,300 |  | 104,611 |  | 275,911 |  |  |  |  |  |  |  |  |  |
Total em 3/31/2018 |  |  |  |  |  |  |  |  |  |  |  |  |  | 293,123 |  | (295,724) |  | 14,225 |  |  |  | 11,624

1. Transnordestina Logística S.A: Assets: Refers mainly to loan agreements in R$: Interest from 125.0% to 130.0% of the CDI. As of March 31, 2019, the loans amounted to R$744,364 (R$706,605 as of December 31, 2018).

2. Banco Fibra S.A: Assets: Refers mainly to Eurobond from Fibra Bank with maturity in February 2028.

3. Panatlantica: Receivables from the sale of steel products.

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· By transaction

|  | Parent Company
|  | Current |  | Non-current |  | Total
|  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Assets |  |  |  |  |  |  |  |  |  |  |  |
Trade receivables (1) (note 6) |  | 1,182,272 |  | 906,865 |  |  |  |  |  | 1,182,272 |  | 906,865
Dividends receivable (Note 8) |  | 261,330 |  | 259,186 |  |  |  |  |  | 261,330 |  | 259,186
Actuarial asset (note 8) |  |  |  |  |  | 80,598 |  | 85,415 |  | 80,598 |  | 85,415
Loans (note 8) |  | 23,264 |  | 22,807 |  | 649,967 |  | 588,285 |  | 673,231 |  | 611,092
Short-term investments / Investments (2) |  | 98,509 |  | 99,109 |  | 96,428 |  | 103,640 |  | 194,937 |  | 202,749
Other receivables (3) (note 8) |  | 15,493 |  | 15,395 |  | 463,182 |  | 458,177 |  | 478,675 |  | 473,572
|  | 1,580,868 |  | 1,303,362 |  | 1,290,175 |  | 1,235,517 |  | 2,871,043 |  | 2,538,879
Liabilities |  |  |  |  |  |  |  |  |  |  |  |
Borrowings and financing |  |  |  |  |  |  |  |  |  |  |  |
Prepayment (note 12) |  | 1,301,410 |  | 1,363,140 |  | 4,848,105 |  | 4,250,264 |  | 6,149,515 |  | 5,613,404
Intercompany Bonds (nota 12) |  | 9,883 |  | 2,395 |  | 362,393 |  | 360,356 |  | 372,276 |  | 362,751
Intercompany Loans (note 12) |  | 1,602,422 |  | 1,704,888 |  | 963,598 |  |  |  | 2,566,020 |  | 1,704,888
|  | 2,913,715 |  | 3,070,423 |  | 6,174,096 |  | 4,610,620 |  | 9,087,811 |  | 7,681,043
Other payables (Note 14) |  |  |  |  |  |  |  |  |  |  |  |
Accounts payable |  | 8,088 |  | 8,060 |  |  |  | 14,501 |  | 8,088 |  | 22,561
Provision for consumption and services |  | 308,333 |  | 299,996 |  |  |  |  |  | 308,333 |  | 299,996
Trade payables |  | 503,261 |  | 344,076 |  |  |  |  |  | 503,261 |  | 344,076
Actuarial liabilities |  |  |  |  |  | 7,982 |  | 7,982 |  | 7,982 |  | 7,982
|  | 819,682 |  | 652,132 |  | 7,982 |  | 22,483 |  | 827,664 |  | 674,615
|  | 03/31/2019 |  | 03/31/2018 |  |  |  |  |  |  |  |
P&L |  |  |  |  |  |  |  |  |  |  |  |
Revenues |  |  |  |  |  |  |  |  |  |  |  |
Sales/Others |  | 764,532 |  | 1,058,449 |  |  |  |  |  |  |  |
Interest (note 24) |  | 18,344 |  | 14,744 |  |  |  |  |  |  |  |
Exclusive funds (note 24) |  | 683 |  | 44 |  |  |  |  |  |  |  |
Expenses |  |  |  |  |  |  |  |  |  |  |  |
Purchases |  | (643,306) |  | (487,690) |  |  |  |  |  |  |  |
Interest (note 24) |  | (71,100) |  | (100,913) |  |  |  |  |  |  |  |
Foreing exchange and monetary variations, net |  | (66,033) |  | (5,561) |  |  |  |  |  |  |  |
|  | 3,120 |  | 479,073 |  |  |  |  |  |  |  |

1. Accounts receivable derive from sales operations of goods and services between the parent company, subsidiaries and joint ventures.

2. Assets: Financial investments classified as current are investments in exclusive funds and in the Fibra Bank and in non-current assets, refers to interests in Usiminas, classified as investments measured at fair value through profit or loss.

3. Non-current: Refers mainly to advances for future capital increases, dividends to be received and receivables from acquisition of debentures.

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· By company

|  |  |  |  |  |  |  |  |  | Parent Company
|  | Assets |  | Liabilities |  | P&L
| Current |  | Non-current |  | Total |  | Current |  | Non-current |  | Total |  | Sales/Others |  | Purchases |  | Finance income(expenses),net |  | Exchange rate variations, net |  | Total
Subsidiaries |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Companhia Metalúrgica Prada (1) |  | 261,156 |  | 121,336 |  | 382,492 |  | 7,142 |  |  |  | 7,142 |  | 174,249 |  | (10,555) |  |  |  |  |  | 163,694
Estanho de Rondônia S.A. |  | 22,156 |  | 1,766 |  | 23,922 |  |  |  |  |  |  |  |  |  | (9,906) |  | 395 |  |  |  | (9,511)
Sepetiba Tecon S.A. |  | 12,252 |  | 102,570 |  | 114,822 |  | 29,837 |  |  |  | 29,837 |  |  |  | (16,871) |  |  |  |  |  | (16,871)
Minérios Nacional S.A. |  | 7 |  |  |  | 7 |  |  |  |  |  |  |  | 7 |  |  |  |  |  |  |  | 7
CSN Mineração S.A. (2) |  | 299,141 |  |  |  | 299,141 |  | 280,670 |  |  |  | 280,670 |  | 21,612 |  | (290,283) |  |  |  |  |  | (268,671)
CSN Energia S.A. |  | 14,309 |  |  |  | 14,309 |  | 108,251 |  |  |  | 108,251 |  |  |  | (44,971) |  |  |  |  |  | (44,971)
Ferrovia Transnordestina Logística S.A. |  | 573 |  | 27,250 |  | 27,823 |  |  |  |  |  |  |  | 573 |  |  |  | 25 |  | (72) |  | 526
Companhia Siderúrgica Nacional, LLC (3) |  | 461,029 |  |  |  | 461,029 |  | 311,887 |  |  |  | 311,887 |  | 180,139 |  |  |  |  |  | 5,863 |  | 186,002
CSN Resources S.A. (4) |  |  |  |  |  |  |  | 1,305,788 |  | 4,131,016 |  | 5,436,804 |  |  |  |  |  | (62,541) |  | (38,045) |  | (100,586)
CSN Steel Corp |  |  |  |  |  |  |  | 5,166 |  | 894,377 |  | 899,543 |  |  |  |  |  | (8,201) |  | 16,844 |  | 8,643
Lusosider Aços Planos, S.A. |  | 210,458 |  |  |  | 210,458 |  | 1 |  |  |  | 1 |  | 123,782 |  |  |  |  |  | 532 |  | 124,314
CSN Islands XI Corp. (5) |  |  |  |  |  |  |  | 134,115 |  |  |  | 134,115 |  |  |  |  |  |  |  | 263 |  | 263
CSN Islands XII Corp. (6) |  |  |  |  |  |  |  | 1,468,288 |  | 876,078 |  | 2,344,366 |  |  |  |  |  |  |  | (50,482) |  | (50,482)
Companhia de Embalagens Metálicas MMSA |  |  |  |  |  |  |  | 16 |  |  |  | 16 |  |  |  |  |  |  |  |  |  |
Companhia Florestal do Brasil |  | 1,103 |  | 500 |  | 1,603 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
CSN Steel Holdings 1, S.L.U. |  |  |  |  |  |  |  | 89 |  | 68,156 |  | 68,245 |  |  |  |  |  | (89) |  | (332) |  | (421)
CSN Productos Sider. S.L. |  |  |  |  |  |  |  | 268 |  | 204,469 |  | 204,737 |  |  |  |  |  | (268) |  | (1,108) |  | (1,376)
|  | 1,282,184 |  | 253,422 |  | 1,535,606 |  | 3,651,518 |  | 6,174,096 |  | 9,825,614 |  | 500,362 |  | (372,586) |  | (70,679) |  | (66,537) |  | (9,440)
Joint-venture and Joint-operation |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
MRS Logística S.A. |  | 23,091 |  |  |  | 23,091 |  | 4,039 |  |  |  | 4,039 |  |  |  | (89,697) |  |  |  |  |  | (89,697)
CBSI - Companhia Brasileira de Serviços e Infraestrutura |  | 2,149 |  |  |  | 2,149 |  | 23,910 |  |  |  | 23,910 |  | 8 |  | (34,330) |  |  |  |  |  | (34,322)
Transnordestina Logística S.A. (7) |  | 248 |  | 859,727 |  | 859,975 |  |  |  |  |  |  |  |  |  |  |  | 11,959 |  |  |  | 11,959
|  | 25,488 |  | 859,727 |  | 885,215 |  | 27,949 |  |  |  | 27,949 |  | 8 |  | (124,027) |  | 11,959 |  |  |  | (112,060)
Other related parties |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
CBS Previdência |  |  |  | 80,598 |  | 80,598 |  |  |  | 7,982 |  | 7,982 |  |  |  |  |  |  |  |  |  |
Banco Fibra |  | 90,838 |  |  |  | 90,838 |  |  |  |  |  |  |  |  |  |  |  | 5,904 |  | 504 |  | 6,408
Usiminas |  |  |  |  |  | - |  | 34,376 |  |  |  | 34,376 |  |  |  | (119,955) |  |  |  |  |  | (119,955)
Panatlântica (8) |  | 140,748 |  |  |  | 140,748 |  | 19,325 |  |  |  | 19,325 |  | 262,931 |  | (26,213) |  |  |  |  |  | 236,718
Partifib Projetos Imobiliários |  | 355 |  |  |  | 355 |  |  |  |  |  |  |  | 1,192 |  |  |  |  |  |  |  | 1,192
Ibis Participações e Serviços |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (275) |  |  |  |  |  | (275)
Vicunha Serviços Ltda. |  |  |  |  |  |  |  |  |  |  |  |  |  | 39 |  | (79) |  |  |  |  |  | (40)
Fundação CSN |  | 1,829 |  |  |  | 1,829 |  | 229 |  |  |  | 229 |  |  |  | (171) |  |  |  |  |  | (171)
|  | 233,770 |  | 80,598 |  | 314,368 |  | 53,930 |  | 7,982 |  | 61,912 |  | 264,162 |  | (146,693) |  | 5,904 |  | 504 |  | 123,877
Associates |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Arvedi Metalfer do Brasil S.A. |  | 31,754 |  |  |  | 31,754 |  |  |  |  |  |  |  |  |  |  |  | 60 |  |  |  | 60
Exclusive funds |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Diplic, Caixa Vertice, VR1, BB Steel (9) |  | 7,672 |  | 96,428 |  | 104,100 |  |  |  |  |  |  |  |  |  |  |  | 683 |  |  |  | 683
Total at 3/31/2019 |  | 1,580,868 |  | 1,290,175 |  | 2,871,043 |  | 3,733,397 |  | 6,182,078 |  | 9,915,475 |  | 764,532 |  | (643,306) |  | (52,073) |  | (66,033) |  | 3,120
Total at 12/31/2018 |  | 1,303,362 |  | 1,235,517 |  | 2,538,879 |  | 3,722,555 |  | 4,633,103 |  | 8,355,658 |  |  |  |  |  |  |  |  |  |
Total at 03/31/2018 |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,058,449 |  | (487,690) |  | (86,125) |  | (5,561) |  | 479,073

1. Companhia Metalúrgica Prada: Refers mainly to receivables in the amount of R$261,156 (254,464 as of December 31, 2018), and debentures from the indirect subsidiary CBL in the amount of R$121,336 (R$ 121,336 as of December 31,2018),

2. CSN Mineração: Liabilities: Account payables related to purchases of iron ore and port services in the amount of R$280,670 (R$ 119,952 as of December 31,2018).

3. Companhia Siderurgica Nacional, LLC: Receivables of R$461,029 (R$357,257 as of December 31, 2018), related to sale of steel for resale. In the current liabilities, refers an expense with commission and logistics on sales of steel for resale in the amount of R$ 311,887 (R$ 298,866 as of December 31,2018).

4. CSN Resources SA: Prepayment and Fixed Rate Notes. As of March 31, 2019, the loans amounted to R$5,436,804 (R$4,961,357 as of December 31, 2018).

5. CSN Islands XI Corp.: Intercompany contracts in US dollars. As of March 31, 2019, loans total R$134,115 (R$179,677 as of December 31, 2018).

6. CSN Islands XII Corp.: Refers mainly to prepayment contracts and Intercompany contracts in dollar. As of March 31, 2019, loans total R$2,344,366 (R$1,525,211 as of December 31, 2018).

7. Transnordestina Logística S.A. Noncurrent assets: refers mainly to an intercompany contract in the amount of R$640,887 (R$ 588,285 as of December 31,2018) and advance for future increase capital in the amount of R$218,840 (R$218,840 as of December 31,2018).

8. Panatlântica S.A: Current assets: refers to accounts receivable for the supply of flat steel in the amount of R$ 140,748 (R$ 53,027 as of December 31,2018).

9. Exclusive funds: Current assets: Refers mainly to investments in government securities and CDBs, in the amount of R$7,672 (R$ 6,989 as of December 31, 2018). Noncurrent assets: Refers to Usiminas S.A. shares in the amount of R$ 96,428 (R$ 103,640 as of December 31,2018). The funds VR1 and Diplic II are managed by Taquari Asset.

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18.b) Key management personnel

The key management personnel with authority and responsibility for planning, directing and controlling the Company’s activities, include the members of the Board of Directors and statutory directors. The following is information on the compensation of such personnel and the related balances as of March 31, 2019.

|  | 03/31/2019 |  | 03/31/2018
|  | Statement of Income
Short-term benefits for employees and officers |  | 3,818 |  | 9,393
Post-employment benefits |  | 26 |  | 26
|  | 3,844 |  | 9,419

19. SHAREHOLDERS’ EQUITY

19.a) Paid-in capital

Fully subscribed and paid-in capital as of March 31, 2019 and December 31, 2018 is R$4,540,000 comprising 1,387,524,047 book-entry common shares without par value. Each common share entitles to one vote in resolutions of the General Meeting.

19.b) Authorized capital

The Company’s bylaws in effect as of March 31, 2019 determine that the capital can be raised to up to 2,400,000,000 shares by decision of the Board of Directors.

19.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 the share capital.

19.d) Ownership structure

As of March 31, 2019, the Company’s ownership structure was as follows:

|  |  | 03/31/2019 |  |  | 12/31/2018
| Number of |  |  | Number of |  |
|  | % of total | % of voting |  | % of total | % of voting
| common |  |  | common |  |
|  | shares | capital |  | shares | capital
| shares |  |  | shares |  |
Vicunha Aços S.A. (*) | 679,522,254 | 48.97% | 49.24% | 679,522,254 | 48.97% | 49.24%
Rio Iaco Participações S.A. (*) | 58,193,503 | 4.19% | 4.22% | 58,193,503 | 4.19% | 4.22%
NYSE (ADRs) | 284,152,319 | 20.48% | 20.59% | 284,152,319 | 20.48% | 20.59%
Other shareholders | 358,246,471 | 25.82% | 25.95% | 358,246,471 | 25.82% | 25.95%
Total outstanding shares | 1,380,114,547 | 99.47% | 100.00% | 1,380,114,547 | 99.47% | 100.00%
Treasury shares | 7,409,500 | 0.53% |  | 7,409,500 | 0.53% |
Total shares | 1,387,524,047 | 100.00% |  | 1,387,524,047 | 100.00% |

(*) Controlling group companies.

19.e) Treasury shares

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The Board of Directors authorized various share buyback programs 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 |  | Sale 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 e 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 e 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 e 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 e 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 e 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 e 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 e 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 |  | Not applicable |  | Not applicable |  |  |  |  |  | 22,981,500 | (2) | 7,409,500

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

1. In 2014, the Board of Directors approved the cancellation of 70,446,061 shares held in treasury without changing the value of the Company's capital stock.

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 recognized the amount of R $ 32,690 related to the profit on the sale of the shares.

As of March 31, 2019, the position of the treasury shares was as follows:

Quantity purchased (Units) |  | Amount paid for the shares |  | Share price |  | Market price of the shares on 03/31/2019 (*)
|  | Minimum |  | Maximum |  | Average |
7,409,500 |  | R$ 58,264 |  | R$ 4.48 |  | R$ 10.07 |  | R$ 7.86 |  | R$ 120,034

(*) The last share average quotation on B3 – S.A. - Brasil, Bolsa, Balcão as of March 31, 2019 was used in the amount of R$ 16.20 per share.

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

The Company adopts a profit distribution policy which, in compliance with the provisions in Law 6,404/76, as amended by Law 9,457/97, will entail to the destination 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.

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

Basic earnings/(loss) 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:

|  |  | Parent Company
| 03/31/2019 |  | 03/31/2018
| Common Shares
Profit for the year | (7,572) |  | 1,471,863
Weighted average number of shares | 1,373,250,595 |  | 1,357,133,047
Basic and diluted EPS | (0,00551) |  | 1,08454

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

20. PAYMENT TO SHAREHOLDERS

The Company's bylaws provide for the distribution of minimum dividends of 25% of adjusted net income under the law, to the holders of its shares.

Dividends are calculated in accordance with the Company's Bylaws and in accordance with the Brazilian Corporate Law.

The following table shows the history of dividends approved and paid:

Approval Year |  | Dividends
2019 (*) |  | 898,332
Total approved |  | 898,332

(*) According to the Ordinary General Meeting (AGO) held on April 26, 2019, dividends will be paid in national currency until December 31, 2019, without monetary adjustment, in one or more installments, according to cash availability. The procedure for payment of declared dividends will be informed in Notice to Shareholders to be timely disclosed by the Company.

21. NET SALES REVENUE

Net sales revenue is comprised as follows:

|  |  |  | Consolidated |  |  |  | Parent Company
|  | 03/31/2019 |  | 03/31/2018 |  | 03/31/2019 |  | 03/31/2018
Gross revenue |  |  |  |  |  |  |  |
Domestic market |  | 3,563,173 |  | 3,302,143 |  | 3,418,248 |  | 3,172,428
Foreign market |  | 3,293,102 |  | 2,609,288 |  | 390,842 |  | 623,481
|  | 6,856,275 |  | 5,911,431 |  | 3,809,090 |  | 3,795,909
Deductions |  |  |  |  |  |  |  |
Sales returns and discounts |  | (60,394) |  | (61,301) |  | (57,298) |  | (45,473)
Taxes on sales |  | (790,415) |  | (784,180) |  | (730,575) |  | (721,459)
|  | (850,809) |  | (845,481) |  | (787,873) |  | (766,932)
Net revenue |  | 6,005,466 |  | 5,065,950 |  | 3,021,217 |  | 3,028,977

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22. EXPENSES BY NATURE

|  |  |  | Consolidated |  | Parent Company
|  | 03/31/2019 |  | 03/31/2018 |  | 03/31/2019 |  | 03/31/2018
Raw materials and inputs |  | (1,797,797) |  | (1,551,131) |  | (1,762,660) |  | (1,328,974)
Labor cost |  | (630,183) |  | (652,488) |  | (293,695) |  | (317,627)
Supplies |  | (472,504) |  | (405,762) |  | (349,240) |  | (289,716)
Maintenance cost (services and materials) |  | (322,986) |  | (290,572) |  | (167,491) |  | (159,510)
Outsourcing services |  | (540,677) |  | (887,224) |  | (204,884) |  | (322,033)
Freights |  | (468,754) |  | (338,955) |  | (70,770) |  | (84,976)
Depreciation, amortization and depletion |  | (306,166) |  | (305,175) |  | (157,112) |  | (142,547)
Others |  | (176,093) |  | (156,467) |  | (3,497) |  | (5,171)
|  | (4,715,160) |  | (4,248,819) |  | (3,009,349) |  | (2,565,578)
Classified as: |  |  |  |  |  |  |  |
Cost of sales |  | (4,021,495) |  | (3,684,743) |  | (2,833,088) |  | (2,337,373)
Selling expenses |  | (573,484) |  | (456,503) |  | (120,144) |  | (154,662)
General and administrative expenses |  | (120,181) |  | (107,573) |  | (56,117) |  | (73,543)
|  | (4,715,160) |  | (4,248,819) |  | (3,009,349) |  | (2,565,578)

Additions to depreciation, amortization and depletion for the period were distributed as follows:

|  |  | Consolidated |  |  |  | Parent Company
| 03/31/2019 |  | 03/31/2018 |  | 03/31/2019 |  | 03/31/2018
Production costs | 298,665 |  | 298,344 |  | 152,637 |  | 137,761
Sales expenses | 1,279 |  | 1,643 |  | 978 |  | 1,238
General and Administrative Expenses | 6,222 |  | 5,188 |  | 3,497 |  | 3,548
| 306,166 |  | 305,175 |  | 157,112 |  | 142,547
Other operating expenses (*) | 21,904 |  | 10,697 |  | 895 |  |
| 328,070 |  | 315,872 |  | 158,007 |  | 142,547

(*) Refers mainly to the depreciation and amortization of paralyzed assets, see note 23.

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23. OTHER OPERATING INCOME (EXPENSES)

|  | Consolidated |  | Parent Company
|  | 03/31/2019 |  | 03/31/2018 |  | 03/31/2019 |  | 03/31/2018
Other operating income |  |  |  |  |  |  |  |
Indemnities/gains on lawsuits |  | 1,287 |  | 546 |  | 1,255 |  | 397
Rentals and leases |  | 2,162 |  | 460 |  | 2,072 |  | 370
Dividends received |  | 380 |  |  |  | 380 |  |
PIS and COFINS to compensate (1) |  | 87,394 |  |  |  | 87,394 |  |
Contractual fines |  | 864 |  | 1,780 |  | 686 |  | 960
Shares - VJR (Note 13 II) |  | 127,653 |  | 1,936,389 |  | 127,653 |  | 1,936,389
Other revenues |  | 9,212 |  | 6,412 |  | 254 |  | 798
|  | 228,952 |  | 1,945,587 |  | 219,694 |  | 1,938,914
Other operating expenses |  |  |  |  |  |  |  |
Taxes and fees |  | (5,134) |  | (5,284) |  | (1,024) |  | (1,988)
Write-off/(Provision) of judicial deposits |  | (3,989) |  | (3,993) |  | (3,978) |  | (3,431)
Expenses with environmental liabilities, net |  | (8,607) |  | (3,790) |  | (3,313) |  | (1,473)
Expenses from tax, social security, labor, civil and environmental law suits | 46,416 |  | (24,393) |  | 48,431 |  | (22,490)
Depreciation of unused equipment and amortization of intangible assets (note 22) | (21,904) |  | (10,697) |  | (895) |  | 0
Write- off of PPE and intagible assests (notes 10 and 11) |  | (13,712) |  | (1,780) |  | (13,542) |  | (16)
Estimated (Loss)/reversal in inventories |  | (41,149) |  | (6,191) |  | (8,935) |  | 1,762
Idle inventories (2) |  | (67,261) |  |  |  | (67,261) |  |
Studies and project engineering expenses |  | (4,919) |  | (6,571) |  | (7,108) |  | (5,577)
Research and development expenses |  | (349) |  | (958) |  | (349) |  | (958)
Advisory expenses |  |  |  | (777) |  |  |  | (658)
Healthcare plan expenses |  | (29,086) |  | (26,088) |  | (28,976) |  | (26,096)
Hedge cash flow realized (Note 13 b) |  | (184,217) |  | (13,732) |  | (184,217) |  | (13,732)
Other expenses |  | (30,461) |  | (44,110) |  | (13,428) |  | (28,863)
|  | (364,372) |  | (148,659) |  | (284,595) |  | (103,815)
Other operating expenses, net |  | (135,420) |  | 1,796,928 |  | (64,901) |  | 1,835,099

(1) Refers to non-inclusion of ICMS in the PIS and COFINS calculation basis.

(2) Due to the reforms in blast furnace 3, there was unused capacity in which the volume of production was below normal.

24. FINANCIAL INCOME (EXPENSES)

|  | Consolidated |  | Parent Company
|  | 03/31/2019 |  | 03/31/2018 |  | 03/31/2019 |  | 03/31/2018
Financial income |  |  |  |  |  |  |  |
Related parties (note 18 a) |  | 20,161 |  | 14,225 |  | 19,027 |  | 14,788
Income from short-term investments |  | 20,110 |  | 27,168 |  | 13,406 |  | 15,178
Outros rendimentos (1) |  | 71,043 |  | 1,503 |  | 68,937 |  | 360
|  | 111,314 |  | 42,896 |  | 101,370 |  | 30,326
Financial expenses |  |  |  |  |  |  |  |
Borrowings and financing - foreign currency |  | (252,348) |  | (215,502) |  | (77,132) |  | (57,575)
Borrowings and financing - local currency |  | (234,691) |  | (264,273) |  | (206,226) |  | (228,488)
Related parties |  |  |  |  |  | (71,100) |  | (100,913)
Capitalized interest (notes 10 and 27) |  | 21,111 |  | 17,090 |  | 5,419 |  | 3,594
Interest, fines and late payment charges |  | (58,234) |  | (2,034) |  | (56,966) |  | (455)
Commission and bank fees |  | (44,183) |  | (41,875) |  | (42,034) |  | (37,928)
PIS/COFINS over financial income |  | (5,366) |  | (3,733) |  | (5,342) |  | (2,798)
Other financial expenses |  | (59,138) |  | (12,929) |  | (34,654) |  | 3,371
|  | (632,849) |  | (523,256) |  | (488,035) |  | (421,192)
Inflation adjustment and exchange differences, net |  |  |  |  |  |  |  |
Inflation adjustments, net |  | (11,711) |  | 1,570 |  | (961) |  | 11,179
Exchange rates, net |  | (101,499) |  | (115,644) |  | (71,138) |  | (13,175)
Exchange gain (losses) on derivatives |  | (354) |  | 730 |  |  |  | -
|  | (113,564) |  | (113,344) |  | (72,099) |  | (1,996)
Financial income (expenses), net |  | (635,099) |  | (593,704) |  | (458,764) |  | (392,862)
Statement of gains and (losses) on derivative transactions |  |  |  |  |  |  |  |
Dollar - to - euro swap |  | (354) |  | 730 |  |  |  |
|  | (354) |  | 730 |  |  |  |

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(1) Refers mainly to the monetary adjustment of the recognition of the non-inclusion of ICMS in the PIS and COFINS calculation basis in the amount of R$ 60,758.

25. SEGMENT INFORMATION

The segment information has not changed in relation to that disclosed in the Company's financial statements as of December 31, 2018. Therefore, management decided not to repeat it in this condensed interim financial information.

According to the Group´s structure, the businesses are distributed and managed in five operating segments as follows:

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(CONVENIENCE TRANSLATION INTO ENGLISH FROM THE ORIGINAL PREVIOUSLY ISSUED IN PORTUGUESE)

Quartely Financial Statements – March 31, 2019 – CIA SIDERURGICA NACIONAL | ## Version: 1

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 03/31/2019
P&L |  | Steel |  | Mining |  | Logistics |  |  |  | Energy |  | Cement |  | Corporate expenses/elimination |  | Consolidated
|  |  | Port |  | Railroads |  |  |  |
Metric tons (thousand) (*) |  | 1,174,957 |  | 8,989,033 |  |  |  |  |  |  |  |  |  | (1,299,148) |  |
Net revenues |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Domestic market |  | 2,567,293 |  | 245,075 |  | 51,584 |  | 334,995 |  | 70,014 |  | 119,845 |  | (628,717) |  | 2,760,089
Foreign market |  | 1,037,967 |  | 1,833,736 |  |  |  |  |  |  |  |  |  | 373,674 |  | 3,245,377
Total net revenue (note 21) |  | 3,605,260 |  | 2,078,811 |  | 51,584 |  | 334,995 |  | 70,014 |  | 119,845 |  | (255,043) |  | 6,005,466
Cost of sales and services |  | (3,222,034) |  | (869,835) |  | (46,567) |  | (261,442) |  | (61,309) |  | (137,670) |  | 577,362 |  | (4,021,495)
Gross profit |  | 383,226 |  | 1,208,976 |  | 5,017 |  | 73,553 |  | 8,705 |  | (17,825) |  | 322,319 |  | 1,983,971
General and administrative expenses |  | (196,865) |  | (41,743) |  | (9,438) |  | (27,424) |  | (6,981) |  | (20,835) |  | (390,379) |  | (693,665)
Depreciation (note 22) |  | 157,340 |  | 91,700 |  | 7,499 |  | 92,189 |  | 4,341 |  | 31,748 |  | (78,651) |  | 306,166
Proportionate EBITDA of joint ventures |  |  |  |  |  |  |  |  |  |  |  |  |  | 127,338 |  | 127,338
Adjusted EBITDA |  | 343,701 |  | 1,258,933 |  | 3,078 |  | 138,318 |  | 6,065 |  | (6,912) |  | (19,373) |  | 1,723,810
Sales by geographic area |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Asia |  | 105 |  | 1,478,737 |  |  |  |  |  |  |  |  |  | 373,674 |  | 1,852,516
North America |  | 135,788 |  |  |  |  |  |  |  |  |  |  |  |  |  | 135,788
Latin America |  | 49,044 |  |  |  |  |  |  |  |  |  |  |  |  |  | 49,044
Europe |  | 853,616 |  | 354,999 |  |  |  |  |  |  |  |  |  |  |  | 1,208,615
Others |  | (586) |  |  |  |  |  |  |  |  |  |  |  |  |  | (586)
Foreign market |  | 1,037,967 |  | 1,833,736 |  |  |  |  |  |  |  |  |  | 373,674 |  | 3,245,377
Domestic market |  | 2,567,293 |  | 245,075 |  | 51,584 |  | 334,995 |  | 70,014 |  | 119,845 |  | (628,717) |  | 2,760,089
Total |  | 3,605,260 |  | 2,078,811 |  | 51,584 |  | 334,995 |  | 70,014 |  | 119,845 |  | (255,043) |  | 6,005,466
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 03/31/2018
P&L |  | Steel |  | Mining |  | Logistics |  |  |  | Energy |  | Cement |  | Corporate expenses/elimination |  | Consolidated
|  |  | Port |  | Railroads |  |  |  |
Metric tons (thousand) (*) |  | 1,277,386 |  | 7,474,162 |  |  |  |  |  |  |  |  |  | (1,308,943) |  |
Net revenues |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Domestic market |  | 2,290,629 |  | 218,650 |  | 65,643 |  | 330,941 |  | 90,619 |  | 130,733 |  | (611,945) |  | 2,515,270
Foreign market |  | 1,383,668 |  | 932,944 |  |  |  |  |  |  |  |  |  | 234,068 |  | 2,550,680
Total net revenue (note 21) |  | 3,674,297 |  | 1,151,594 |  | 65,643 |  | 330,941 |  | 90,619 |  | 130,733 |  | (377,877) |  | 5,065,950
Cost of sales and services |  | (2,900,337) |  | (795,292) |  | (45,943) |  | (244,173) |  | (66,286) |  | (125,282) |  | 492,570 |  | (3,684,743)
Gross profit |  | 773,960 |  | 356,302 |  | 19,700 |  | 86,768 |  | 24,333 |  | 5,451 |  | 114,693 |  | 1,381,207
General and administrative expenses |  | (234,058) |  | (20,864) |  | (9,972) |  | (23,307) |  | (6,933) |  | (19,974) |  | (248,968) |  | (564,076)
Depreciation (note 22) |  | 150,463 |  | 106,487 |  | 4,035 |  | 64,621 |  | 4,315 |  | 26,682 |  | (51,428) |  | 305,175
Proportionate EBITDA of joint ventures |  |  |  |  |  |  |  |  |  |  |  |  |  | 119,284 |  | 119,284
Adjusted EBITDA |  | 690,365 |  | 441,925 |  | 13,763 |  | 128,082 |  | 21,715 |  | 12,159 |  | (66,419) |  | 1,241,590
Sales by geographic area |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Asia |  | 157 |  | 852,152 |  |  |  |  |  |  |  |  |  | 234,068 |  | 1,086,377
North America |  | 430,706 |  |  |  |  |  |  |  |  |  |  |  |  |  | 430,706
Latin America |  | 105,557 |  |  |  |  |  |  |  |  |  |  |  |  |  | 105,557
Europe |  | 829,013 |  | 80,792 |  |  |  |  |  |  |  |  |  |  |  | 909,805
Others |  | 18,235 |  |  |  |  |  |  |  |  |  |  |  |  |  | 18,235
Foreign market |  | 1,383,668 |  | 932,944 |  |  |  |  |  |  |  |  |  | 234,068 |  | 2,550,680
Domestic market |  | 2,290,629 |  | 218,650 |  | 65,643 |  | 330,941 |  | 90,619 |  | 130,733 |  | (611,945) |  | 2,515,270
Total |  | 3,674,297 |  | 1,151,594 |  | 65,643 |  | 330,941 |  | 90,619 |  | 130,733 |  | (377,877) |  | 5,065,950

(*) The ore sales volumes presented in this note take into consideration Company sales and the interest in its subsidiaries and joint ventures.

· Adjusted EBITDA

Adjusted EBITDA is the main measurement through which the chief operating decision maker assesses the segment performance and the capacity to generate recurring operating cash, consisting of profit for the year less net financial income (expenses), income tax and social contribution, depreciation and amortization, equity in results, results of discontinued operations and other operating income (expenses), plus the proportionate EBITDA of joint ventures.

Even though it is an indicator used in segment measurement, EBITDA is not a measurement recognized by accounting practices adopted in Brazil or IFRS, it does not have a standard definition, and may not be comparable with measurements using similar names provided by other companies.

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As required by IFRS 8, the table below shows the reconciliation of the measurement used by the chief operating decision maker with the results determined using the accounting practices:

|  |  |  | Consolidated
|  | 03/31/2019 |  | 03/31/2018
Profit for the year |  | 86,763 |  | 1,486,495
Depreciation/Amortization/Depletion (Note 22) |  | 306,166 |  | 305,175
Income tax and social contribution (note 15) |  | 458,857 |  | 558,711
Financial income (expenses) (note 24) |  | 635,099 |  | 593,704
EBITDA |  | 1,486,885 |  | 2,944,085
Other operating income (expenses) (note 23) |  | 135,420 |  | (1,796,928)
Equity in results of affiliated companies (note 9.b) |  | (25,833) |  | (24,851)
Proportionate EBITDA of joint ventures |  | 127,338 |  | 119,284
Adjusted EBITDA (*) |  | 1,723,810 |  | 1,241,590

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

26. INSURANCE

Aiming to properly mitigate risk and in view of the nature of its operations, the Company and its subsidiaries have taken out several different types of insurance policies. Such policies are contracted in line with the Risk Management policy and are similar to the insurance taken out by other companies operating in the same lines of business as CSN and its subsidiaries. The risks covered under such policies include the following: Domestic Transportation, International Transportation, Life and Casualty, Health, Vehicles Fleet, D&O (Civil Liability Insurance for Directors and Officers), General Civil Liability, Engineering Risks, Named Peril, Export Credit, Surety Bond and Port Operator’s Civil Liability.

In 2019, after negotiation with insurers and reinsurers in Brazil and abroad, an insurance policy was issued for the contracting of a policy of Operational Risk of Property Damages and Loss of Profits, with effect from March 31, 2019 to March 31, 2020. Under the insurance policy, the LMI (Maximum Limit of Indemnity) is US$600 million and deductibles in the amount of R$385 million for material damages and 45 days for loss of profits and covers the following Company’s units and subsidiaries: Presidente Vargas Steelworks, CSN Mineração and Sepetiba Tecon. Management understands that the policies covers its assets and the risks to which the Company is subject.

In view of their nature, the risk assumptions adopted are not part of the scope of an audit of the financial statements and, accordingly, were not examined by our independent auditors.

27. ADDITIONAL INFORMATION TO CASH FLOWS

The following table provides additional information on transactions related to the statement of cash flows:

| Consolidated |  | Parent Company
| 03/31/2019 |  | 03/31/2018 |  | 03/31/2019 |  | 03/31/2018
Income tax and social contribution paid | 8,030 |  | 15,373 |  |  |  |
Addition to PP&E with interest capitalization (note 10 and 24) | 21,111 |  | 17,090 |  | 5,419 |  | 3,594
Capitalization in subsidiaries without cash (note 14.a) | 640,989 |  |  |  | 61,072 |  |
| 670,130 |  | 32,463 |  | 66,491 |  | 3,594

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(1) For the calendar year 2019, the Company opted for taxation based on Quarterly Real Profit, based on art. 1 of Law 9,430 / 96, and the income and social contribution taxes payable in a single share, up to the last business day of the month subsequent the end of each quarter.

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28. STATEMENT OF COMPREHENSIVE INCOME

|  |  | Consolidated |  |  |  | Parent Company
| 03/31/2019 |  | 12/31/2018 |  | 03/31/2019 |  | 12/31/2018
Profit for the year | 86,763 |  | 1,486,495 |  | (7,572) |  | 1,471,863
Other comprehensive income |  |  |  |  |  |  |
Items that will not be subsequently reclassified to the statement of income |  |  |  |  |  |  |
Actuarial (losses) / gains on defined benefit plan from investments in subsidiaries, net of taxes | 30 |  | 30 |  | 30 |  | 30
Actuarial (losses)/Gains on defined benefit pension plan |  |  |  |  |  |  |
Income tax and social contribution on actuarial (losses)/gains on defined benefit pension plan |  |  |  |  |
| 30 |  | 30 |  | 30 |  | 30
Items that could be subsequently reclassified to the statement of income |  |  |  |  |  |  |
Cumulative translation adjustments for the period | (21,804) |  | 37,958 |  | (21,804) |  | 37,958
Fair value through other comprehensive income |  |  | (1,559,680) |  |  |  | (1,559,680)
(Loss)/gain on the percentage change in investments |  |  |  |  |  |  |
(Loss)/gain on cash flow hedge accounting | (18,440) |  | (18,646) |  | (18,440) |  | (18,646)
Realization of cash flow hedge accounting reclassified to the income statement | 184,217 |  | 13,732 |  | 184,217 |  | 13,732
(Loss)/gain on investments hedge of investments in subsidiaries |  |  |  |  | 6,180 |  | (4,860)
(Loss)/gain on net investment hedge in foreign subsidiaries | 6,180 |  | (4,860) |  |  |  |
(Loss)/ gain on business combination |  |  |  |  |  |  |
| 150,153 |  | (1,531,496) |  | 150,153 |  | (1,531,496)
| 150,153 |  | (1,531,496) |  | 150,153 |  | (1,531,496)
Total comprehensive income for the year | 236,946 |  | (44,971) |  | 142,611 |  | (59,603)
Attributable to: |  |  |  |  |  |  |
Controlling shareholders | 142,611 |  | (59,603) |  | 142,611 |  | (59,603)
Non-controlling shareholders | 94,335 |  | 14,632 |  |  |  |
| 236,946 |  | (44,971) |  | 142,611 |  | (59,603)

29. EVENTS AFTER THE REPORTING PERIOD

• Issuance of debt securities

In April 2019, the Company issued debt securities in the foreign market ("Notes"), through its subsidiary CSN Resources SA, in the amount of US$ 1 billion, with maturity in 2023 and 2026 at an interest rate of 7.625% year. The proceeds were used in the tender offer ("Tender Offer") of Notes issued by CSN Resources S.A. and CSN Islands XI Corp., subsidiaries of the Company, which amounted to US$ 1 billion, divided into US$ 405 million maturing in 2019 and US$ 595 million due in 2020 The Notes are unconditionally and irrevocably guaranteed by the Company.

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COMMENTS ON THE PERFORMANCE OF BUSINESS PROJECTIONS

Projections

The Company clarifies that the information disclosed in this item represents a mere estimate, hypothetical data and cannot be interpreted as a promise of performance by the Company and/or its Management. The projections listed below include market variables that are not under the Company’s control and, therefore, may change.

#

# a) Purpose of Projection

CSN estimates an adjusted annualized EBTIDA close to R$7,5 billion for 2019.

CSN estimates a leverage measured by the ratio of net debt to adjusted EBITDA close to 3.5 times at the end of the first half of 2019.

CSN estimates a leverage measured by the ratio of net debt to adjusted EBITDA close to 3.0 times at the end of 2019.

CSN estimates iron ore production volume at 31.5 million of tons (Mton) in 2019, 30.7Mton in 2020, 31.2Mton in 2021, 36.6Mton in 2022 and 38Mton in 2023.

#

# b) Period and validity term of the projection.

For the year 2019, is projected an EBITDA close to R$7.5 billion. In turn, the validity term of the presented projection ends with the results being disclosed for the fiscal year ended December 31, 2019, that will be available to the market within the period established by the local authority.

In June 2019, CSN estimates a leverage measured by the ratio of net debt to adjusted EBTIDA close to 3.5 times, that will be available to the market at the end of the first half of 2019.

In December 2019, CSN estimates a leverage measured by the ratio of net debt to adjusted EBTIDA close to 3.0 times, that will be available to the market at the end of 2019 period.

CSN estimates annual volume of iron ore production from 2019 to 2023 and the annual volumes will be available to the market in the DFPs to be published in each of the years.

# c) Assumptions of the projection, indicating which can be influenced by the issuer’s management and which are beyond its control.

All assumptions mentioned below are subject to the influence of external variables, which are beyond the control of the Company’s management. Therefore, in case of relevant changes in these assumptions, the Company may revise its estimates mentioned below, modifying them in comparison with those originally presented.

Adjusted EBITDA

The assumptions used to project the adjusted EBITDA of R$7.5 billion for 2019, consider the best average prices for flat steel, as well as the higher sales volume, highlighting the allocation of goods to the domestic market focusing on better operational margins. In relation to the mining, our estimate is that the price levels (Platts – 62% Fe) of iron ore in 2019 above 2018 when the index closed at an average of US$ 69.46 / t

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Leverage

The assumptions used for the leverage measured by the ratio of net debt to adjusted EBITDA close to 3.5 times over a 3 months and 3.0 times over a 9 months is based on an increase of the adjusted EBITDA, resulting in a higher generation of free cash flow and lower net debt, leading to a substantial reduction of the indicator.

Volume of Iron Ore Production

The volume of ore production considers our mining plan between 2019 and 2023, with an increase in pellet feed production, in line with the investment projects announced through Material Fact and Corporate Presentation with the market.

# d) Values of the indicators that are subject of the forecast.

Net Revenue | 2016 | 2017 | 2018 | 2019 E | 2020 E | 2021 E | 2022 E | 2023 E
Estimated | n.a. | 18,000 | 22,230 | n.a. | n.a. | n.a. | n.a. | n.a.
Reached | 17,149 | 18,525 | 22,969 | n.a. | n.a. | n.a. | n.a. | n.a.
Variation % | - | 3% | 3% | - | - | - | - | -
Adjusted EBITDA | 2016 | 2017 | 2018 | 2019 E | 2020 E | 2021 E | 2022 E | 2023 E
Estimated | n.a. | 5,000 | 5,574 | 7,000 | n.a. | n.a. | n.a. | n.a.
Reached | 4,075 | 4,645 | 5,849 | n.a. | n.a. | n.a. | n.a. | n.a.
Variation % | - | -7% | 5% | - | - | - | - | -
Leverage | 2016 | 2017 | 2018 | 2019 E | 2020 E | 2021 E | 2022 E | 2023 E
Estimated | n.a. | 5,00x | n.a. | 3,50x | n.a. | n.a. | n.a. | n.a.
Reached | 6,32x | 5,66x | 4,55x | n.a. | n.a. | n.a. | n.a. | n.a.
Variation % | n.a. | 13% | n.a. | n.a. | n.a. | n.a. | n.a. | n.a.
Volume of Iron Ore Production | 2016 | 2017 | 2018 | 2019 E | 2020 E | 2021 E | 2022 E | 2023 E
Estimated | n.a. | n.a. | 28,500 | 31,500 | 30,700 | 31,200 | 36,600 | 38,000
Reached | 32,174 | 29,921 | 27,875 | n.a. | n.a. | n.a. | n.a. | n.a.
Variation % | n.a. | n.a. | -2% | n.a. | n.a. | n.a. | n.a. | n.a.
*E = estimated |
**n.a. = not evaluated |

If the issuer has disclosed, in the last 3 fiscal years, projections over the progress of its indicators:

a) Inform which were being replaced by new projections and which were being repeated.

There were no new estimates, all of which were already communicated to the market through a Material Fact, as well as subsequently updated in the Reference Form.

Estimates maintained:

CSN estimates an adjusted annualized EBTIDA close to R$7,5 billion for 2019.

CSN estimates a leverage measured by the ratio of net debt to adjusted EBITDA close to 3.0 times at the end of 2019.

CSN estimates a leverage measured by the ratio of net debt to adjusted EBITDA close to 3.5 times at the end of the first half of 2019.

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CSN estimates iron ore production volume at 31.5 million of tons (Mton) in 2019, 30.7Mton in 2020, 31.2Mton in 2021, 36.6Mton in 2022 and 38Mton in 2023.

# b) In relation to the projections for periods that have already occured, compare the projection data with the performance indicators, clearly indicating the reasons that led to deviations in the projections.

In 2018, Net Revenue was 3% higher than the previous estimate of R$22,2 billion, due to the better steel and iron ore prices.

In 2018, the Adjusted EBITDA was 5% higher than the previous estimate of R$5,6 billion, due to the fact that mining presented an adjusted EBITDA higher than expected, given the higher average price and quality of our iron ore.

The volume of production of iron ore was within the expectation, with small variation of -2% and according to our expected mining plan.

Net Revenue | 2016 | 2017 | 2018
Estimated | n.a. | 18,000 | 22,230
Reached | 17,149 | 18,525 | 22,969
Variation % | - | 3% | 3%
Adjusted EBITDA | 2016 | 2017 | 2018
Estimated | n.a. | 5,000 | 5,574
Reached | 4,075 | 4,645 | 5,849
Variation % | - | -7% | 5%
Volume of Iron Ore Production | 2016 | 2017 | 2018
Estimated | n.a. | n.a. | 28,500
Reached | 32,174 | 29,921 | 27,875
Variation % | n.a. | n.a. | -2%
*E = estimated |
**n.a. = not evaluated |

# c) In relation to the projections for periods still in progress, inform if the projections remain valid on the date of delivery the form and, when applicable, explain why they were abandoned or replaced.

Ongoing and valid estimates:

CSN estimates an adjusted annualized EBTIDA close to R$7,5 billion for 2019.

CSN estimates a leverage measured by the ratio of net debt to adjusted EBITDA close to 3.0 times at the end of 2019.

CSN estimates a leverage measured by the ratio of net debt to adjusted EBITDA close to 3.5 times at the end of the first half of 2019.

CSN estimates iron ore production volume at 31.5 million of tons (Mton) in 2019, 30.7Mton in 2020, 31.2Mton in 2021, 36.6Mton in 2022 and 38Mton in 2023.

Follow-up and changes to projections disclosed

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The result of the first quarter of 2019 does not bring any material variation to the results projections previously submitted for the year 2019, which can therefore be maintained.

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(Free translation from the original issued in Portuguese. In the event of any discrepancies, the Portuguese language version shall prevail.)

Independent Auditor’s Report on Review of the Interim Financial Information

To the

Shareholders, Directors and Management of

Companhia Siderúrgica Nacional

São Paulo – SP

Introduction

We have reviewed the accompanying individual and consolidated interim financial information of Companhia Siderúrgica Nacional (“Company”), identified as Parent and Consolidated, respectively, included in the Interim Financial Information Form (ITR) for the quarter ended March 31, 2019, which comprises the balance sheet as at March 31, 2019 and the related statement of profit and loss and statement of comprehensive income (loss) for the three-month periods then ended, and the statement of changes in equity and statement of cash flows for the nine-month period then ended, including a summary of significant accounting policies and other explanatory notes.

Management is responsible for the preparation of the individual and consolidated interim financial information in accordance with Technical Pronouncement CPC 21 (R1) - Interim Financial Reporting and IAS 34 - Interim Financial Reporting, issued by the International Accounting Standards Board (IASB), as well as for the presentation of such information in accordance with the standards issued by the Brazilian Securities and Exchange Commission (CVM) applicable to the preparation of Interim Financial Information (ITR). Our responsibility is to express a conclusion on this interim financial information based on our review.

Scope of review

We conducted our review in accordance with Brazilian and international standards on review of interim financial information (NBC TR 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity and ISRE 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity, respectively). A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with the standards on auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion on the individual and consolidated interim financial information

Based on our review, nothing has come to our attention that causes us to believe that the accompanying individual and consolidated interim financial information included in the Interim Financial Information Form (ITR) referred to above is not prepared, in all material respects, in accordance with CPC 21 (R1) and IAS 34 applicable to the preparation of interim financial information and presented in accordance with the standards issued by the Brazilian Securities and Exchange Commission (CVM).

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Emphasis of matter

Ability of the jointly-controlled subsidiary Transnordestina Logística S.A. to continue as a going concern

We draw attention to Note 9.c) to the interim financial information, which describes the percentage of completion of the new railway network by the jointly-controlled subsidiary Transnordestina Logística S.A. (TLSA), currently under construction and originally scheduled to be completed by January 2017, is currently being revised and discussed by the relevant regulatory bodies. The completion of the work under the project (and consequent start of operations) is contingent upon receiving ongoing financial contribution from TLSA´s shareholders and third parties. These events and conditions, together with other issues described in note 9.c) to the financial statements, indicate the existence of significant uncertainty that may raise significant doubt as to TLSA´s ability to continue as a going concern. Our conclusion is not qualified regarding this matter.

Other matters

Interim statements of value added

We have also reviewed the individual and consolidated statements of value added (DVA) for the tree-months period ended March 31, 2019, prepared under the responsibility of the Company’s management, the presentation of which is required by the standards issued by the Brazilian Securities and Exchange Commission (CVM) applicable to the preparation of interim financial information and considered supplemental information by IFRS, which does not require the presentation of a DVA. This interim financial information was subject to the same review procedures described above and, based on our review, nothing has come to our attention that causes us to believe that it was not fairly presented, in all material respects, in relation to the individual and consolidated interim financial information taken as a whole.

São Paulo, May 08, 2019

Nelson Fernandes Barreto Filho

Grant Thornton Auditores Independentes

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Opinions and Statements / Officers Statement on the Financial Statement

As Executive Officers of Companhia Siderurgica Nacional, we declare pursuant to Article 25, paragraph 1º, item VI of CVM Instruction 480, of December 7, 2009, as amended, that we reviewed, discussed and agreed with the Company’s Financial Statements for the quarter ended March 31,2019.

São Paulo, May 08 th, 2019.

____________________________________________

Benjamin Steinbruch

CEO

____________________________________________

Luis Fernando Barbosa Martinez

Executive Officer

____________________________________________

David Moise Salama

Executive Officer

____________________________________________

Pedro Gutemberg Quariguasi Netto

Executive Officer

____________________________________________

Marcelo Cunha Ribeiro

Executive Officer – CFO and Investors Relations

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Opinions and Statements / Officers Statement on Auditor’s Report

As Executive Officers of Companhia Siderurgica Nacional, we declare pursuant to Article 25, paragraph 1º, item V of CVM Instruction 480, of December 7, 2009, as amended, that we reviewed, discussed and agreed with the opinion expressed on the Independent Auditors’ Report related to the Company’s Financial Statements for the quarter ended March 31,2019.

São Paulo, May 08 th, 2019.

____________________________________________

Benjamin Steinbruch

CEO

____________________________________________

Luis Fernando Barbosa Martinez

Executive Officer

____________________________________________

David Moise Salama

Executive Officer

____________________________________________

Pedro Gutemberg Quariguasi Netto

Executive Officer

____________________________________________

Marcelo Cunha Ribeiro

Executive Officer – CFO and Investors Relations

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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: May 30, 2019

COMPANHIA SIDERÚRGICA NACIONAL
By: | /S/ Benjamin Steinbruch
| Benjamin Steinbruch Chief Executive Officer

By: | /S/ Marcelo Cunha Ribeiro
| Marcelo Cunha Ribeiro Chief Financial and Investor Relations Officer

FORWARD-LOOKING STATEMENTS

This press release may contain forward-looking statements. These statements are statements that are not historical facts, and are based on management's current view and estimates of future economic circumstances, industry conditions, company performance and financial results. The words "anticipates", "believes", "estimates", "expects", "plans" and similar expressions, as they relate to the company, are intended to identify forward-looking statements. Statements regarding the declaration or payment of dividends, the implementation of principal operating and financing strategies and capital expenditure plans, the direction of future operations and the factors or trends affecting financial condition, liquidity or results of operations are examples of forward-looking statements. Such statements reflect the current views of management and are subject to a number of risks and uncertainties. There is no guarantee that the expected events, trends or results will actually occur. The statements are based on many assumptions and factors, including general economic and market conditions, industry conditions, and operating factors. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations.