Gerdau, Latin America’s largest steelmaker, posted a BRL 1.95 billion net loss in Q3, reverting a BRL 261.9 million net profit last year, the company said on Thursday.
The company’s loss, the largest in at least five years, came as a surprise for some analysts, which expected the steelmaker to break even in Q3. The company said non-recurring and non-cash items had a strong impact in the company’s Q3 result.
The Porto Alegre, Brazil-based steelmaker said net revenues in Q3 rose 11.4 percent, year-on-year, to BRL 11.9 billion, while crude steel production declined 6.1 percent in Q3, year-on-year, to 4.2 million mt. Steel shipments in Q3 improved 2.4 percent, year-on-year, to 4.6 million mt, the Brazilian steelmaker said.
Gerdau said the lower steel production volume in Q3 was due to the company’s decision in adjusting inventories in all its business operations. As for steel shipments, the higher figures were a result of higher exports from its Brazilian operations, as the USD remained stronger over the BRL.
Gerdau’s gross margin declined to 10.2 percent in Q3, from 11.9 percent a year ago. EBITDA margin declined to 10.8 percent in Q3, from 11.6 percent the year prior. EBITDA in Q3 reached 1.29 billion, 4 percent up, year-on-year.
USD = BRL 3.85 (October 29)