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California Steel Reports
1st Quarter Results

April 14, 2004 — California Steel Industries, Inc. reported net income of $1.8 million on net sales of $233 million for the period ended March 31, 2004.

Net income of $1.8 million compares to net income of $5.4 million in first quarter 2003. Results this year were impacted by one-time charges associated with the redemption of the company's 8.5% senior notes due in 2009 in the amount of $150.0 million, and the issuance of new senior notes, also in the amount of $150.0 million, at 6.125% due in 2014. EBITDA for the quarter was $15.2 million, slightly lower than EBITDA generated in the same period last year of $19.3 million.

CSI shipped 566,630 net tons of steel products, the best quarterly shipment level in the company's history. This represents an increase of more than 28% compared to the tonnage sold in the first quarter of 2003. Sales revenues of $233.1 million dollars in first quarter 2004 are more than 17% higher than the same period in the prior year. Average sales prices were down 9% when compared to first quarter 2003, although up 5% compared to fourth quarter 2003.

Average slab consumption costs (including the FOB slab price, quality extras, insurance, ocean freight, unloading charges, duties and rail freight from the Port of Los Angeles to CSI's Fontana works) rose 4% in first quarter 2004 over 2003.

"We look at first quarter 2004 as a solid stepping stone to start the year," said Vicente Wright, President and CEO. "I would highlight two significant events that mark our performance during the quarter. First is our response to our customers' demand for product, as evidenced by our record-breaking shipment level of over 566,000 tons," Wright commented. "Second is the successful issuance of our 6-1/8% unsecured notes, which will replace our 8-1/2% percent notes," he added. "It was an important achievement for our company."

Liquidity continues to remain strong, as the balance under the company's Revolving Credit Agreement remains at zero as of March 31, 2004, with availability of more than $107 million and a cash balance of $36.1 million.

California Steel Industries is the leading producer of flat rolled steel products in the western United States (the 11 states located west of the Rocky Mountains) based on tonnage billed, with a broad range of products, including hot rolled, cold rolled, electric resistant weld pipe and galvanized coil and sheet. Located in Fontana, Calif., CSI has about 1000 employees.

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