Acquisitions lift Gerdau Group revenue to R$ 15.3 billion

In the first half of 2007, Gerdau Group sales revenue grew 13.7% with the consolidation of acquisitions and growth in domestic Brazilian demand

Growth in Brazilian domestic demand, together with the consolidation of companies acquired in Spain (GSB), Mexico (Sidertul), Peru (Siderperu), Venezuela (Sizuca) and the Dominican Republic (Inca), pushed Gerdau Group revenues to R$ 15.3 billion, up 13.7% on the first half of 2006. Of this total, 44.7% originated in Brazil, 39.3% in the United States and Canada, 11.4% in Latin America (Argentina, Chile, Colombia, the Dominican Republic, Mexico, Peru, Uruguay and Venezuela) and 4.6% in Spain. Consolidated net profit for the period was R$ 1.7 billion. “We have continued our strategic challenge of being one of the consolidators of the global steel sector, absorbing companies in regions where we already had a presence, such as Latin America and Europe. Although they are not included in the first half balance sheet, we also draw attention to our entry into Asia with the Kalyani Group, opening up the opportunities of a new continent, and the major expansion in the United States with the acquisition of Chaparral Steel,” said Gerdau Group CEO, André Gerdau Johannpeter. The Gerdau Group sold 8.2 million metric tons of steel products in the first half of 2007, up 10.2%. As a result, production also increased, reaching 8.3 million metric tons of steel (up 8.2%) and 7.0 million metric tons of rolled products (up 11.9%). Rolled products are obtained through the transformation of steel into items such as rebar, bars, profiles and wire rod. In Brazil, growth in the civil construction and industrial sectors, the Gerdau Group’s main customers, generated a 6.4% growth in physical sales, to 2.1 million metric tons. Exports from Brazil also remained high, totaling 1.1 million metric tons (up 1.1%). In order to meet domestic and international demand, units in Brazil produced 3.7 million metric tons of steel (up 2.5%) and 2.3 million metric tons of rolled products (up 2.6%). From January through June, facilities in Canada and the United States sold 3.7 million metric tons of steel products, up 4.9% on the first half of 2006. This was a result of investments in infrastructure and industrial and commercial projects, and growth in industry. In the same period, steel production in the region was up 2.9% to 3.6 million metric tons. Rolled product production was up 7.4% to 3.5 million metric tons Sales from operations in Latin America, excluding Brazil, were up 55.2% to 1.1 million metric tons. From January through June, steel production in this region totaled 862,000 metric tons (up 76.1%). Rolled product production was 954,000 metric tons (up 62.3%). In Spain, sales were up 48.2% to 221,000 metric tons. Production continued to grow, reaching 232,000 metric tons of steel (up 39.9%) and 221,000 metric tons of rolled products (up 53.9%). The consolidation of the company GSB contributed significantly to this performance.
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