California Steel Industries Reports Record Sales in 2002

January 6, 2002 -- Today California Steel Industries, Inc. (“CSI”) reported record sales exceeding two million tons for 2002. As a result of strong sales performance and improved margins, CSI fourth quarter 2002 net income was $9.9 million. EBITDA for the quarter totaled $27.3 million. For the fiscal year ended December 31, 2002 CSI's unaudited net income was $35.0 million and EBITDA was $100.6 million.

Lourenço Gonçalves, President and CEO, commented: "2002 was one of the best years in CSI's history, and the CSI family is very proud of our accomplishments this year. Our number one goal - the safety of every CSI employee - was achieved as we set another back-to-back and all time low recordable injury rate, cutting our last year record in half. We also set a new yearly sales record, exceeding two million tons shipped in 2002 for the first time in our eighteen-year history. Last but not least, we continued to improve CSI's operational efficiency, achieving improved yield ratios and lower finished and in-process inventories."

Mr. Gonçalves stated further: "We still lack any clear signal that the economy is improving or that steel consumption is rising. In fact, we have seen increased levels of supply into the West Coast market as a result of weakness in other U.S. steel markets, but this has not impacted our full order book. Based on the strong relationship with our customers and on the role that CSI plays in the market as a reliable source of steel regardless of the overall economic scenario, we remain confident that we will maintain our strong market position as the recently arrived competition fights among themselves."

During what is typically a seasonally slow fourth quarter, CSI sold more than 493,000 tons. This represented a 10% increase compared to sales in the same quarter last year. CSI's average sales price increased $46 per ton when compared to the third quarter of 2002 and up $94 per ton when compared to the same period last year. Sales volumes were as follows (net tons):

	4Q02	4Q01-	FY02	FY01
Hot Rolled	218,112	212,757	945,663	829,161
Cold Rolled	68,342	53,658	234,505	253,465
Galvanized	176,367	160,754	719,711	625,138
Pipe	30,577	22,926	113,902	120,607
Total	493,398	450,095	2,013,781	1,828,371

Average slab consumption cost (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) for the quarter increased by approximately $34 per ton when compared to third quarter 2002, and was approximately $51 per ton higher than slab consumption cost in fourth quarter 2001.

Figures (in thousands) are as follows:

	Three Months Ended		Twelve Months Ended
			(unaudited)	(audited)
	12/31/2002	12/31/2001	12/31/2002	12/31/2001
Billed Net Tons	493.4	450.1	2,013.8	1,828.4
Net Sales Revenue	$212,477	$155,271	$754,355	$640,390
Cost of Sales	$185,133	$143,695	$657,085	$612,713
SG&A	$7,851	$5,916	$26,013	$23,350
Operating Income	$19,493	$1,660	$71,257	$4,237
Interest Expense, net	$3,531	$3,590	$14,127	$16,316
Income (Loss) Before Tax	$16,459	$281	$58,139	($7,317)
Net Income (Loss)	$9,880	$86	$35,001	($3,711)
Depreciation & Amort	$6,929	$7,555	$28,827	$30,204
EBITDA	$27,297	$12,227	$100,601	$40,159

Liquidity remained strong throughout the year as several working capital reduction initiatives were completed. Capital spending for 2002 totaled $20.8 million. At year-end, CSI's ending debt balance was $163 million, with $3 million in cash on hand and $102 million available on our revolving line of credit.

In other news:

On December 12, 2002 the Board of Directors of California Steel Industries, Inc. decided to terminate the engagement of KPMG, LLP ("KPMG") as its independent auditor upon completion of the December 31, 2002 audit and issuance of related reports thereon. The decision to terminate KPMG's engagement was based on the Board's determination that it is in the best interests of CSI to rotate the independent auditors every five years, mirroring the procedure of one of its 50% shareholders. For 2003, the Board assigned the role of external auditor to PriceWaterhouseCoopers.

Previous KPMG reports on CSI's consolidated financial statements did not contain any adverse opinion or disclaimer of opinion, nor were they otherwise modified as to uncertainty, audit scope or accounting principal. Further, there are no disagreements whatsoever between CSI and KPMG on any matter of accounting principle or practice, financial statement disclosure, or auditing scope or procedure.

This release may contain forward-looking statements relating to future financial results. Actual results may differ materially as a result of factors over which the Company has no control. These risk factors and additional information are included in the Companyís reports filed with the Securities and Exchange Commission.