Metalurgica Gerdau (GOAU4) Q4 2024 earnings summary

Executive summary

• Adjusted EBITDA for 2024 reached BRL 10.8 billion, up 17.3% year-over-year in 4Q24, driven by cost reduction and improved performance in Brazil, despite sequential declines from North American price pressure and seasonality.

• Net sales reached R$16.8 billion in 4Q24, up 14.3% year-over-year but down 3.2% from 3Q24, with steel shipments at 2.7 million tonnes, a 2.4% increase year-over-year.

• Free cash flow was R$435 million in 4Q24, with R$888 million in working capital released; full-year free cash flow totaled R$2.86 billion.

• Maintained solid balance sheet and low leverage while investing in growth and shareholder returns.

• Achieved lowest accident frequency rate in 124-year history, reinforcing commitment to safety and operational excellence.

Financial highlights

• Adjusted EBITDA: R$2.4 billion in 4Q24, down 20.7% sequentially, up 17.3% year-over-year; margin at 14.2%.

• Adjusted net income: R$667 million (R$0.11/share), down 53.6% from 3Q24 and 10.8% from 4Q23.

• Achieved BRL 1.5 billion in cost savings in 2024, meeting guidance.

• Invested BRL 6.2 billion in CapEx, with over half allocated to strategic projects.

• Distributed BRL 2.9 billion to shareholders via dividends and buybacks, representing a 66% payout.

Outlook and guidance

• 2025 CAPEX plan set at R$6.0 billion, focused on modernization, environmental practices, and expansion in the Americas.

• Positive outlook for North American nonresidential and infrastructure demand; U.S. order book exceeds 70 days.

• Brazilian market faces challenges from high steel imports and potential demand softness due to inflation and interest rates.

• Strategic focus on value-added products and mining to enhance competitiveness.

• Execution of CAPEX plan contingent on market and economic conditions in operating countries.