CSN POSTS YEAR-TO-DATE NET REVENUE OF R$10.6 BILLION AND EBITDA OF
R$5.1 BILLION, BOTH RECORD FIGURES OF THE COMPANY, AND NET INCOME OF
R$1.8 BILLION IN THE PERIOD. IN THE 3Q08, CSN PRESENTS NET REVENUE OF
R$4.0 BILLION AND EBITDA OF R$2.1 BILLION, BOTH RECORD FIGURES OF THE
COMPANY, AND NET INCOME OF R$40 MILLION

São Paulo, Brazil, November 14, 2008

Companhia Siderúrgica Nacional (CSN) (BOVESPA: CSNA3) (NYSE: SID) announces today its results for the third quarter of 2008 (3Q08), in accordance with Brazilian accounting principles and denominated in Brazilian Reais (R$). All comments presented herein refer to the Company’s consolidated results and comparisons refer to the third quarter of 2007 (3Q07), unless otherwise stated. For reference purposes, US amounts were converted into Reais at the Real/US Dollar exchange rate of R$1.914, as of September 30, 2008.

• Third-quarter net revenue totaled R$4.0 billion, a quarterly record, 13% up on the previous three months and 36% up year-on- year. Net revenue in the first nine months stood at R$10.6 billion, also a new record of the Company, representing an increase of more than R$2.2 billion or 26% on the same period in 2007;
• Gross profit came to R$2.1 billion in the 3Q08 and R$5.0 billion year-to-date, also record figures;
• EBITDA amounted to R$2.1 billion in the third quarter, another record, 23% up on the R$1.7 billion reported in the 2Q08 and 60% up on the 3Q07. Year-to-date EBITDA totaled R$5.1 billion, yet another record and higher than the figure for the entire year of 2007;
• Both consolidated and parent-company EBITDA margin reached 52% in the third-quarter, a 4 p.p. and 2 p.p. increase, respectively, on the 2Q08. CSN has consistently recorded average EBITDA margins of above 40% for more than 7 years;
• 3Q08 net income of R$40 million reflects increased financial expenses from the impact of the US$23.00 slide in the price of our ADRs, which negatively impacted the financial result of the Total Return Equity Swap made by the Company. The object of this transaction is the exchange of return on assets (swap) against the price variation of the Company’s ADRs. The transaction was originally executed in 2003 and successively renewed on its respective maturities, with the last of such renewal having taken place in September 2008. Gains resulting from this transaction from its implementation to December 31, 2007, totaled R$2.2 billion and we recorded additional gains of R$0.9 billion in the 1H08, giving a total result since 2003 of R$3.1 billion. In the 3Q08, we recorded losses of R$1.3 billion. However, the Company’s accumulated gains reached approximately R$1.8 billion even after 3Q08 losses;
• Year-to-date net income totaled R$1.8 billion;
• Consolidated and parent-company sales of flat steel on the domestic market accounted for 88% and 95% of total sales, respectively, in the 3Q08. In the first nine months, domestic sales amounted to 3.3 million tonnes, a 28% year-on-year improvement;
• Net revenue per tonne averaged R$2,448 on the domestic market in the 3Q08, versus R$2,053 per tonne in the previous quarter and R$1,899 per tonne in 3Q07;
• In the first nine months of 2008, ROE and ROCE (return on capital employed) were 57% and 31%, respectively;
• After the close of the third quarter, CSN announced the conclusion of negotiations and the execution of the main contracts related to the establishment of a strategic partnership with a consortium comprising ITOCHU Corporation, Nippon Steel Corporation, JFE Steel Corporation, POSCO, Sumitomo Metal Industries, Ltd., Kobe Steel, Ltd., and Nisshin Steel Co., Ltd. involving the alienation of 40% of NAMISA’s capital stock for US$3.12 billion to that consortium. The conclusion of the transaction is subject to the compliance with certain regulatory and precedent conditions. The parties expect to close the transaction by the end of November.

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Brazil

In the first nine months of 2008, Brazil’s economy recorded consistent growth. In the 3Q08 in particular, the scenario was exceptionally positive, with a decline in the IPCA consumer price index, strong GDP growth, a higher number of loan operations, lower unemployment and increased industrial output.
Inflationary pressure looks set to continue this year. As if the increase in food and other commodities prices was not enough, the devaluation of the Real against the dollar has now made imports more expensive. According to the latest Focus Report, the market expects the IPCA to close 2008 at 6.29%, close to the upper limit of the fluctuation band established by the Central Bank, ending 2009 at 5.00% . Estimates for the IGP-M general price index for 2008 and 2009 are 10.65% and 5.50% respectively.
In accordance with Central Bank monetary policy, the COPOM raised the SELIC, Brazil’s base rate, to 13.75% p.a. in September as a means of keeping inflation under control. This rate was retained at the last meeting in October and is expected to remain in place until the end of the year, before falling to 13.50% at the close of 2009.

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Signs of uncertainty began to appear as of mid-September, thanks to the shrinkage of the global economy and some companies of other industrial segments are already projecting a drop in production and are granting collective vacations. However, unlike in previous crises, the country’s foreign reserves are at comfortable levels, above US$200 billion, and the Central Bank has already shown that it will not hesitate to make use of them if necessary. It has been frequently promoting dollar auctions and currency swaps in order to boost market liquidity. The more expensive dollar favors exports and hampers imports. Market expectations for the exchange rate at the end of 2008 and 2009 are R$2.15 and R$2.10, respectively.
As for the sector itself, Brazilian Steel Institute figures show that national output remained warm in the 3Q08.
Crude steel production totaled 9.4 million tonnes in the 3Q08, 8.1% up on the previous quarter, while rolled production reached 6.6 million tonnes, up by 2.9% on the 2Q08, led by flat rolled, with 3.7 million tonnes. Year-to-date domestic sales of rolled products totaled 16.9 million tonnes, 15.8% up year-on-year, while domestic flat rolled sales stood at 9.8 million tonnes, a 9.6% improvement over the 9M07. Also in the first nine months, the more even distribution of wealth and the relatively favorable borrowing conditions proved crucial for the performance of the automotive, construction, capital goods and home appliance/OEM industries.

Automotive Industry
According to ANFAVEA, the auto manufacturers’ association, third-quarter vehicle output in the 3Q08 moved up 2.7% over the previous quarter, while production in the first nine months increased 20% year-on-year, accompanied by a 27% upturn in domestic sales. Favorable credit conditions were fundamental for the renewal of the national truck fleet and the restrictions in the next few months will almost certainly affect vehicle production and sales in Brazil.

Agricultural Machinery
Year-to-date agricultural machinery production grew by 32.7% over the first nine months of 2007, while domestic sales climbed by 48.4% on the same comparison basis. However, the possible credit restrictions, uncertainties over the level of the exchange rate and the impact of the international crisis on agricultural commodity prices may affect producers’ profits next year. Public financing lines and programs such as Mais Alimentos (More Food), designed to encourage tractor sales and adopted in the states of Paraná and São Paulo, will be fundamental to the sector’s performance.

Construction
The construction sector did very well through September and should close the year with growth of 10%. Ongoing projects and investment decisions taken in 2008 will partially sustain sector activity in the first half of 2009, although the global liquidity crisis has led builders to reassess their investment portfolios and many projects have been put on hold.
Aware of the sector’s importance to economic development and job creation, at the end of October the federal government announced new financing lines totaling R$3 billion for the real estate and construction sector, which will be used by companies to discount receivables, tide them through the temporary suspension of credit by the private Banks and top up their working capital.

Home Appliances / OEM
The sector is expected to record annual growth of around 10%, virtually identical to the 11% posted last year. Although September’s sales volume was below the historical average for the sector, manufacturers expect a recovery at the end of the year, when demand for these products is normally more heated. However, the credit restrictions, high interest rates and the exchange rate uncertainties may well lead to a reduction in consumption.

Distribution
Steel distributors’ year-to-date sales totaled 2.45 million tonnes, 24.9% up on the first nine months of 2007. Steel distributors’year-to-date purchases came to 3.02 million tonnes, up by 17% over the same period of 2007, which should ensure stability until the end of the current year.

International Market

USA

Following the steel upward price trajectory through June, the weakening of the U.S. economy, the vacation season in the northern hemisphere and the reduction in consumer confidence have all helped diminish demand for steel products. CRU International Ltd. estimates a drop of 6.4% in flat steel consumption in the 3Q08 over the 2Q08, which had a negative impact on prices.

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Although international steel prices and maritime freight charges have both come down, imports have not moved up accordingly, benefiting the local steelmakers.
Demand is expected to remain slow until the end of the year, given that consumers are postponing their purchases, thereby reducing their inventories.
In an attempt to encourage consumption and credit, the FED recently introduced successive interest rate cuts and the base rate is now 1% p.a. These measures, together with the massive economic stimulus package, underline the U.S. government’s commitment to the recovery of economic growth.

Europe

The global economic turbulence has hit industrial production in Europe, reducing consumption of steel products and leading to a build-up of inventories. Although prices in the 3Q08 were slightly higher than their U.S. counterparts, as announced by CRU International, Ltd, European producers have signaled their willingness to reduce output in order to prevent prices from falling further.
Although products from Asia and Russia are being offered at attractive prices, consumers are postponing new purchases and making use of their inventories.
In order to contain the crisis and prevent a collapse of the local financial system, the European governments have launched a bail-out package for the region’s banks, involving financing lines totaling more than 1 trillion Euros.

Asia

The Chinese economy recorded growth of around 10% in the first nine months of 2008, according to Oxford Economics. Nevertheless, following an exceptionally favorable first half, the 3Q08 was marked by a slowdown in demand and a reduction in the confidence of consumers, who made less purchases volumes and began to use their existing inventories. As of August, the global uncertainties and the credit squeeze triggered a domestic price slide.
Given the cost pressure on several local manufacturers, production cut-backs and the closure of less efficient plants should help balance supply and demand.

CSN produced 1.32 million tonnes of crude steel in the 3Q08, 2% more than the previous quarter and 5% down on the 3Q07.

Third-quarter rolled steel output totaled 1.17 million tonnes, 3% down on the 2Q08 and 1% down year-on-year, basically due to the programmed maintenance stoppage to the hot strip mill.

Given Brazil’s strong economic growth through August, the favorable exchange rate and the expected hot strip mill maintenance, CSN opted to import semi-finished products to meet growing domestic demand. As a result, throughout the 3Q08, aside from its own semi-finished items, CSN was using slabs and hot-rolled coils acquired from third parties.

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3Q08 Costs

CSN’s total production costs came to R$1.53 billion in the third quarter, R$313 million, or 25% up on the previous quarter, chiefly due to the increase in raw material prices, as detailed below:

Raw materials: quarter-over-quarter increase of R$316 million, caused by:
- Coke: increase of R$128 million, due to higher international prices;
- Coal: upturn of R$86 million, thanks to market price adjustments;
- Purchased slabs and hot-rolled coils: in the 3Q08 CSN used around 39,000 tonnes of slabs and hot-rolled coils in its rolled steel production, pushing up production costs by R$73 million over the 2Q08;
- Pellets: growth of R$23 million, basically due to higher consumption.

Labor: growth of R$6 million, thanks to the full impact of the 8% pay rise in May/08, following the collective bargaining agreement.

General manufacturing costs: remained flat at around R$382 million, at the same level of 2Q08.

9M08 Costs

In the first nine months, production costs totaled R$3.88 billion, R$369 million, or 10%, more than in the same period last year, chiefly due to the following factors:

Raw materials: year-on-year increase of R$310 million, explained primarily by:
- Coke: increase of R$222 million, due to higher consumption and international prices;
- Coal: increase of R$62 million in costs, thanks to market price adjustments;
- Scrap: rise of R$56 million, basically due to higher consumption;
- Purchased slabs and hot-rolled coils: upturn of R$49 million in costs due to higher consumption;
- Other raw materials: increase of R$43 million;
- Zinc: reduction of R$120 million, due to the decline in international prices.

Labor: growth of R$39 million, thanks to the pay rise in May/08 following the collective agreement;
General costs: rise of R$18 million, due to higher natural gas and maintenance prices, partially offset by reductions in other costs.

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Total Sales Volume

CSN’s year-to-date sales volume totaled 4.0 million tonnes, in line with the first nine months of 2007. Third-quarter sales volume stood at 1.3 million tonnes.

Domestic Market

Domestic market sales came to 1.1 million tonnes in the 3Q08, 15% up year-on-year and flat over the previous quarter. Year-to-date sales amounted to 3.3 million tonnes, 28% more than in the 9M07.

Domestic sales accounted for 88% of the third-quarter total sales volume, 5 p.p. more than in the 2Q08, reflecting the Company’s strategy of prioritizing the domestic market, considering the growing demand and more attractive prices in the Brazilian Market .

Export Market

Third-quarter export volume stood at 154,000 tonnes, 31% down on the 2Q08 and 60% less year-on-year, due to the routing of sales to the domestic market. In the 3Q08, 45% of exports went to Latin America and 31% to Europe.

Market Share and Product Mix

The Company’s share of the domestic flat steel market increased to 39% in the 3Q08, 3 p.p. up on the 3Q07, led by tin plate, with a 98% share; galvanized, with 48%; hot-rolled, with 35%; and cold-rolled, with 26%.

Also in the third quarter, CSN had a 49% share of the construction market, 44% of the distribution market, 41% of the home appliance/OEM market, 22% of the auto market and a massive consolidated 98% share of the steel packaging market. Coated products accounted for 47% of 3Q08 total sales volume.

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On the domestic market, net revenue per tonne averaged R$2,448 in the 3Q08, versus R$2,053 in the previous three months. The 19% upturn reflects the incorporation of the price hikes implemented in May and July 2008.

In 2008 to date, CSN has introduced three price increases, in March, May and July 2008, giving the following total percentages:
- Hot-rolled, 50%;
- Cold-rolled, 38%;
- Galvanized, 27%;
- Tin plate, 12%;

Average export prices in Reais moved up 23% over the 2Q08, primarily due to the improved sales mix and higher international prices.

• PRODUCTION

CSN’s own iron ore production plus acquisitions from third parties totaled 7.4 million tonnes in the 3Q08, 4.5 million of which from Casa de Pedra; 1.3 million from NAMISA; and 1.6 million from third parties.

Using the same criterion, the year-to-date figure stood at 21.3 million tonnes, 13.5 million of which from Casa de Pedra; 3.9 million from NAMISA; and 3.9 million from third parties.

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• SALES

Iron ore sales, excluding own consumption, came to 5.4 million tonnes in the third quarter and 13.1 million tonnes year-to-date. The domestic market accounted for 21% of sales, or 2.7 million tonnes, in the first nine months, and exports accounted for 79%, or 10.4 million tonnes.

In addition, the Presidente Vargas Mill absorbed 5.5 million tonnes in the 9M08 and 1.8 million tonnes in the 3Q08.

• INVENTORIES

Iron ore inventories in September 30, 2008 were approximately 14 million tonnes.

NAMISA – SUBSEQUENT EVENTS

In July 2007, NAMISA, a wholly-owned CSN subsidiary, acquired 100% of Companhia de Fomento Mineral (“CFM”). The total amount involved in the transaction was initially estimated at up to US$440 million, subject to the compliance with certain regulatory and precedent condition and conclusion of an adequate due diligence. At the signature of the contract US$100 million were paid and other US$250 million, in August 2007. From the remaining balance of R$90 million, the parties involved in the transaction agreed in November 2008, to pay final R$50 million. There is no additional amount to be paid by CSN.

In April 2008, CSN released a Notice to the Market informing that it had hired Goldman Sachs to provide financial advisory for the potential alienation, total or partial, of its stake in NAMISA.

On October 21, 2008, CSN released a Material Fact, informing the market about the conclusion of negotiations as well as the signature of related contracts for the establishment of a strategic partnership with the Consortium comprising ITOCHU Corporation, Nippon Steel Corporation, JFE Steel Corporation, POSCO, Sumitomo Metal Industries, Ltd., Kobe Steel, Ltd., and Nisshin Steel Co., Ltd. (the “Consortium”), under the following terms:

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The parties proceed with negotiations aiming to conclude necessary requirements for the closing of the transaction within above mentioned period.

Net revenue totaled R$4.0 billion in the 3Q08, a new Company record, 13% up on the 2Q08 and 36% up year-on-year, thanks to the steel product price hikes and the higher share of domestic market sales. It is also worth noting the upturn in iron ore sales in the 3Q08, which already account for 16% of total net revenue.

Operating expenses totaled R$344 million in the 3Q08, R$27 million more than in the previous quarter due to the slight upturn in domestic market selling expenses.

In year-on-year-terms, these expenses moved up by R$17 million for the same reason.

Year-to-date EBITDA came to R$5.1 billion, which is higher than the full-year EBITDA posted by the Company since the beginning of operations in 1946.

Third-quarter EBITDA totaled R$2.1 billion, a new quarterly record and a significant 60% up on the 3Q07. In relation to the 2Q08, EBITDA climbed by 23%, mainly due to the increases in the price of the steel Company’s products and the greater share of the mining segment in results.

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The consolidated 3Q08 EBITDA margin stood at exceptional 52%, a year-on-year improvement of around 8 p.p. and 4 p.p. up on the 2Q08.

The consolidated EBITDA margin of the Steel segment reached 51%, while the margin of the Mining segment was 67%, and Others, 30%.

The parent company’s 3Q08 EBITDA margin reached 52%, 2 p.p. higher than the previous three months.

The 3Q08 net financial result was negative by R$1.71 billion, chiefly due to the following factors:
• Provisions for interest on loans and financing totaling R$183 million;
• Monetary restatement of tax provisions according to SELIC rate amounting to R$112 million; and
• Losses of R$1.3 billion resulting from the Total Return Equity Swap, based on CSN’s ADR price, which negatively impacted the financial result of the swap transaction made by the Company. The purpose of this transaction is the exchange of return on assets (swap) against the price variation of the Company’s ADRs. The transaction was originally executed in 2003 and successively renewed on its respective maturities, with the last of such renewal having taken place in September 2008. Gains resulting from this transaction from its implementation to December 31, 2007, totaled R$2.2 billion and we recorded additional gains of R$0.9 billion in the 1H08, giving a total result since 2003 of R$3.1 billion. In the 3Q08, we recorded losses of R$1.3 billion. However, the Company’s accumulated gains reached approximately R$1.8 billion even after 3Q08 losses.

The company does not have any leveraged hedge transactions relating to exchange rate. It foreign exchange exposure through the third quarter 2008 was immaterial.

Net debt closed the 3Q08 at R$6.28 billion, R$1.25 billion more than the R$5.03 billion recorded at the end of the previous quarter, basically due to:
• Negative net financial result in the 3Q08: R$1.71 billion;
• Investments of R$0.6 billion in various expansion projects;
• Increase of R$0.5 billion in tax expenses;
• Increase of R$0.5 billion in working capital;
• These effects were partially offset by EBITDA of R$2.1 billion in 3Q08.

The net debt/EBITDA ratio, based on EBITDA of R$6.34 billion in the last 12 months, stood at 0.99 at the close of the 3Q08, similar to the figure posted at the end-of-2007.

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Non-operating expenses amounted to R$20 million in the 3Q08, chiefly due to the period booking of provisions for fixed asset write-offs. This was R$41 million lower than in the 2Q08, primarily due to the percentage variation in equity result of the investment in CFN booked in the latter quarter.

The year-to-date non-operating result was negative by R$83 million, R$256 million lower than in the 9M07, thanks to non-recurring revenue of R$182 million from the sale of CSN’s share of Corus Group PLC in the latter period.

Total income tax and social contribution were approximately R$60 million positive in the 3Q08, mainly due to the booking of subsidiaries’ deferred income and social contribution credits.

In the first nine months of 2008, these taxes represented a net expense of R$585 million.

CSN posted a 3Q08 net income of R$40 million, R$991 million down on the previous three months, primarily due to:

- Gross profit of R$2.1 billion, R$412 million up on the 2Q08;
- On the other hand, the net financial result was R$1.7 billion negative in the 3Q08, affecting the quarter net income.

In the first nine months, net income totaled R$1.84 billion, fueled by gross profit of R$5.04 billion and jeopardized by the net financial expense of R$1.38 billion.

CSN invested R$639 million in the 3Q08, R$372 million of which went to the parent company, allocated as follows:

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• Expansion of the Casa de Pedra mine: R$147 million;

• Maintenance and repairs: R$83 million;

• Capitalization of financial charges: R$62 million;

• Expansion of the Port of Itaguaí: R$20 million;

• Works plan: R$18 million.

The remainder went to minor maintenance projects and technological improvements, designed to increase operational efficiency.

Investments in subsidiaries totaled R$268 million, most of which in:

• MRS Logística: R$113 million;

• CSN Cimentos: R$61 million;

• Transnordestina Logística: R$56 million.

Investments in the first nine months of 2008 came to around R$1.6 billion.

Working capital closed September at R$1.7 billion, 42% up on the end-of-2Q08 figure. The main impact came from the R$523 million increase in the asset balance, chiefly due to the R$189 million upturn in “Accounts Receivable” and the R$358 million increase in “Inventories”, reflecting the price adjustments and the repositioning of inputs at higher costs. Liabilities were virtually identical to the previous quarter, with the R$444 million increase in the “Suppliers” line being offset by the R$420 million reduction in “Taxes Payable”, due to lower taxable income in the period.

The 3Q08 average supplier payment period increased from 20 days to 81 days, while the average receivables period remained flat at 22 days. The inventory turnover period averaged 131 days, 16 days up on the 2Q08.

Share Performance

In 2008 to date, CSN’s shares have fallen by 20%, versus the IBOVESPA’s 22% decline. Following a successful first half, when CSN’s shares appreciated by 39%, the global economic instability contaminated all the world’s stock markets, including the BOVESPA and the NYSE. On the latter exchange, CSN’s ADRs fell by 27% year-to-date, versus the Dow Jones’ 19% downturn.

In the 3Q08, daily traded volume remained stable on the BOVESPA at approximately R$170 million. In New York, volume climbed by 17%, from an average of US$154 million per day in the 2Q08, to US$180 million in the 3Q08.

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CSN is pleased to invite you to attend its 3Q08 Earnings Conference Call and Webcast, as follows:

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INCOME STATEMENT
CONSOLIDATED - Corporate Law - In Thousand of R$

15

INCOME STATEMENT
PARENT COMPANY - Corporate Law - In Thousand of R$

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BALANCE SHEET
Corporate Law - thousands of R$

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CASH FLOW STATEMENT
CONSOLIDATED - Corporate Law - thounsands of R$

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NET FINANCIAL RESULT
Consolidated - Corporate Law - thousands of R$

NET FINANCIAL RESULT
Parent Company - Corporate Law - thousands of R$

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SALES VOLUME
Consolidated – Thousand t

SALES VOLUME
Parent Company - Thousand t

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NET REVENUE PER UNIT
Consolidated - In R$/t

NET REVENUE PER UNIT
Parent Company - In R$/t

DOLAR EXCHANGE RATE
in R$ / US$

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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.