OREANDA-NEWS. In the first three months of 2015, Gerdau posted net sales of R\$10.4 billion, practically stable in relation to the same period last year. This performance was affected primarily by weak steel demand in the regions where it has operations and by global overcapacity. On the other hand, net sales benefitted from the effects of currency variation on the translation of U.S. dollar into Brazilian real.
 
Gerdau's steel shipments in the period came to 4.1 million tonnes, declining 6% on the first quarter of last year, while steel production reached 4.3 million tonnes, down 5%.
 
In this scenario, consolidated operational cash generation (EBITDA) was R\$1.1 billion, decreasing 9% on the first quarter of last year, mainly due to weaker demand in Brazil's domestic market and lower iron ore shipments. On the other hand, EBITDA in the North America Business Operation, which focuses on serving the long steel segment, posted significant gains on the same period last year. Gerdau’s consolidated net income declined to R\$267 million, from R\$440 million in the first quarter of 2014, on lower operational income and a higher negative financial result.
 
“Gerdau’s strategy of diversification across geographic regions and management's efforts at all operations enabled it to mitigate the impacts on our performance of this challenging moment for the global steel industry. In addition to our ongoing efforts to adjust production to demand, we reduced our general and administrative expenses at the global level. We will remain cautious over the coming months, carefully monitoring market developments in a scenario of global overcapacity and economic uncertainties in Brazil. We will continue to work to capture operational efficiency gains and optimize our working capital, while remaining highly selective in our new investments (CAPEX).

Lastly, I'd like to reaffirm our confidence in the experience amassed by our management and in the flexibility of our operations, which are factors essential to ensuring that we come out of this challenging scenario even stronger,” said Gerdau CEO Andr? B. Gerdau Johannpeter.
 
During the quarter, all markets served by Gerdau posted lower shipments. In Brazil, shipments to the domestic market (excluding the special steel production units) fell 13% in relation to the same period last year, to 1.3 million tonnes, which was partially offset by exports from the country, which increased 97% to 305,000 tonnes.
 
The United States and Canada (excluding special steel production units) shipped 1.4 million tonnes, down 4% on the first quarter of last year, which was impacted by the higher supply of imported products in the region. Meanwhile, the units in other Latin American countries (excluding Brazil) shipped 634,000 tonnes, 7% less than in the first three months of 2014. Shipments by the Special Steel Business Operation (including the mills in Brazil, the United States, India and Spain) came to 696,000 tonnes, down 8% on the first quarter of 2014.
 
From January to March, iron ore shipments came to 1.5 million tonnes, compared to 2 million tonnes in the same period last year. Of this total, 1.2 million tonnes were destined to Gerdau mills and 299,000 tonnes to the market.
 
Investments by Gerdau reach R\$612 million in the first quarter
 
In the first quarter, the Company recorded expenditures of R\$612 million on previously announced investments in fixed assets (CAPEX), with the highlight the construction of a new heavy plate rolling mill at the Ouro Branco Mill in Minas Gerais. The rolling mill has annual production capacity of 1.1 million tonnes and should be commissioned in late 2016.
 
For 2015, Gerdau will continue its plans to invest R\$1.9 billion in CAPEX, focusing on investments to capture productivity gains and in maintenance. 

Dividend payment to be made on June 2, 2015
 
On June 2, the corporations Gerdau S.A. and Metal?rgica Gerdau S.A. will pay, respectively, interest on equity and dividends for the first quarter of 2015. The amounts to be paid are R\$101.2 million to the shareholders of Gerdau S.A. (R\$0.06 per share) and R\$8.1 million to the shareholders of Metal?rgica Gerdau S.A. (R\$0.02 per share).

About Gerdau
 
Gerdau is the leading manufacturer of long steel in the Americas and a major global supplier of special steel. In Brazil, also produces flat steel and iron ore, activities that are expanding its product mix and the competitiveness of its operations. Gerdau has industrial operations in 14 countries – the Americas, Europe and Asia – with a combined installed capacity of more than 25 million tonnes of steel a year. It is also Latin America’s biggest recycler and, worldwide, transforms millions of tonnes of scrap metal into steel every year, reinforcing its commitment to sustainable development in the regions where it operates. With more than 120.000 shareholders, Gerdau's shares are listed on the New York, S?o Paulo and Madrid stock exchanges.