Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Bolsa de Valores de Sao Paulo  >  Gerdau S.A.    GGBR4   BRGGBRACNPR8

GERDAU S.A.

(GGBR4)
  Report
End-of-day quote. End-of-day quote Bolsa de Valores de Sao Paulo - 01/15
26.08 BRL   -5.92%
01/15GERDAU S A : Tax Policy
PU
2020GERDAU S.A. : Ex-dividend day for
FA
2020GERDAU S A : Morgan Stanley Upgrades Gerdau to Overweight From Equal Weight
MT
SummaryChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
SummaryMost relevantAll NewsPress ReleasesOfficial PublicationsSector newsMarketScreener StrategiesAnalyst Recommendations

Gerdau S A : 3Q20 Quarterly Results

10/28/2020 | 07:35am EST

QUARTERLY

RESULTS

GERDAU S.A.

3Q20

São Paulo, October 28, 2020 - Gerdau S.A. (B3: GGBR4 / NYSE: GGB) announces its results for the third quarter of 2020. The consolidated financial statements of the Company are presented in Brazilian real (R$), in accordance with International Financial Reporting Standards (IFRS) and the accounting practices adopted in Brazil. The information in this report does not include the data of associates and jointly controlled entities, except where stated otherwise.

GERDAU'S PERFORMANCE IN 3Q20

Operating Results

CONSOLIDATED

3Q20

3Q19

2Q20

9M20

9M19

Volumes (1,000 tonnes)

Production of crude steel

3,200

2,733

17%

2,433

32%

8,820

9,501

-7%

Shipments of steel

3,189

3,056

4%

2,365

35%

8,244

9,012

-9%

Results (R$ million)

Net Sales

12,222

9,931

23%

8,745

40%

30,194

30,111

0%

Cost of Goods Sold

(10,525)

(8,946)

18%

(8,027)

31%

(26,924)

(26,584)

1%

Gross profit

1,697

985

72%

718

136%

3,270

3,527

-7%

Gross margin (%)

13.9%

9.9%

8.2%

10.8%

11.7%

SG&A

(370)

(365)

2%

(306)

21%

(1,047)

(1,078)

-3%

Selling expenses

(131)

(116)

13%

(97)

35%

(348)

(359)

-3%

General and administrative expenses

(239)

(249)

-4%

(209)

15%

(699)

(719)

-3%

%SG&A/Net Sales

3.0%

3.7%

3.5%

3.5%

3.6%

Adjusted EBITDA

2,139

1,465

46%

1,318

62%

4,634

4,596

1%

Adjusted EBITDA Margin

17.5%

14.8%

15.1%

15.3%

15.3%

Production & Shipments

In 3Q20, crude steel production grew in relation to both 2Q20 and 3Q19 due to the recovery of economic activity in the various countries where the company operates. Note that 2Q20 was marked by shutdowns at certain industrial units due to the impacts from the covid-19 pandemic.

Steel shipments in 3Q20 grew in relation to 2Q20 and 3Q19, led by shipments to the domestic market in the Brazil BD supported by the robust recovery of the construction industry.

Operating Result

Net Sales

Net sales in 3Q20 accompanied the growth in shipments in relation to both 2Q20 and 3Q19. Note that net sales in the period were mainly influenced by the 36% Brazilian real depreciation against the U.S. dollar in the last 12 months, which had a positive effect on the translation of net sales from our operations in the North America BD.

Cost of Goods Sold

Similarly, cost of goods sold also reflected the higher shipments and currency translation effect on the North America operations, as well as on inputs imported by the Brazil BD, and increased in relation to both comparison periods. The prices of the main raw materials used by the company also rose, led by the price increases on the prior-year period in scrap (+27%) and iron ore (+28%).

2

Gross Profit

Consolidated gross profit and gross margin increased significantly, explained by the 18% increase in net sales per tonne sold in relation to 3Q19, while cost per tonne sold increased 13%.

Selling, General & Administrative Expenses

Selling, general and administrative expenses remained in line with 3Q19, corresponding to 3.0% of net sales, which is 70 bps lower than the ratio registered in 3Q19 and the best ratio ever reported by the company.

EBITDA & EBITDA MARGIN

Breakdown of Consolidated EBITDA

3Q20

3Q19

2Q20

9M20

9M19

(R$ million)

Net income

795

289

175%

315

152%

1,331

1,115

19%

Net financial result

303

562

-46%

330

-8%

865

1,237

-30%

Provision for income and social contribution taxes

282

(150)

-

131

116%

433

264

64%

Depreciation and amortization

647

504

28%

611

6%

1,815

1,535

18%

EBITDA - Instruction CVM ¹

2,027

1,205

68%

1,387

46%

4,444

4,151

7%

Impairment of financial assets

3

8

-56%

25

-87%

72

16

360%

Equity in earnings of unconsolidated companies

(71)

(10)

638%

4

-

(78)

15

-

Proportional EBITDA of associated companies and jointly controlled

180

81

122%

91

99%

384

234

64%

Fixed cost impacts of plants without production

-

238

-

119

-

119

238

-50%

Credit recovery / Provisions

-

(57)

-100%

(308)

-

(308)

(57)

440%

Adjusted EBITDA²

2,139

1,465

46%

1,318

62%

4,634

4,596

1%

Adjusted EBITDA Margin

17.5%

14.8%

15.1%

15.3%

15.3%

CONCILIATION OF CONSOLIDATED EBITDA

3Q20

3Q19

2Q20

9M20

9M19

(R$ million)

EBITDA - Instruction CVM ¹

2,027

1,205

1,387

4,444

4,151

Depreciation and amortization

(647)

(504)

(611)

(1,815)

(1,535)

OPERATING INCOME BEFORE FINANCIAL RESULT AND TAXES³

1,380

701

776

2,629

2,617

1 - Non-accounting measure calculated in accordance with CVM Instruction 527.

2 - Non-accounting measure calculated by the Company. The Company presents Adjusted EBITDA to provide additional information on cash generation in the period.

3 - Accounting measure reported in the consolidated Income Statement.

In 3Q20, adjusted EBITDA and adjusted EBITDA margin increased in relation to both comparison periods, mainly due to higher shipments to the domestic market in the Brazil BD and the better results in the South America BD. Note that this is the best quarterly EBITDA registered by the company since 2008.

EBITDA (R$ million) & EBITDA Margin (%)

3

Financial Result & Net Income

CONSOLIDATED

3Q20

3Q19

2Q20

9M20

9M19

(R$ million)

Income before financial income expenses and taxes¹

1,380

701

97%

776

78%

2,629

2,617

0.5%

Financial Result

(303)

(562)

-46%

(330)

-8%

(865)

(1,237)

-30%

Financial income

42

49

-14%

51

-17%

139

138

1%

Financial expenses

(354)

(368)

-4%

(390)

-9%

(1,069)

(1,066)

0%

Exchange variation, net (including net investment hedge)

57

(193)

-

29

92%

30

(214)

-

Exchange variation (other currencies)

(48)

(42)

15%

(20)

140%

35

(78)

-

Gains (losses) on financial instruments, net

(1)

(9)

-94%

0

-

0

(16)

-

Income before taxes¹

1,076

139

674%

446

141%

1,765

1,379

28%

Income and social contribution taxes

(282)

150

-

(131)

116%

(433)

(264)

64%

Exchange variation including net investment hedge

1

211

-100%

19

-95%

100

190

-47%

Other lines

(283)

(123)

130%

(85)

231%

(469)

(516)

-9%

Non recurring items

-

62

-

(64)

-100%

(64)

62

-

Consolidated Net Income ¹

795

289

175%

315

152%

1,331

1,115

19%

Non recurring items

-

(119)

-100%

(124)

-100%

(124)

119

-

Fixed costs Impacts of plants without production

-

238

-

119

-100%

119

238

-50%

Credit recovery / Provisions

-

(57)

-100%

(308)

-100%

(308)

(57)

440%

Income taxon extraordinary items

-

(62)

-100%

64

-100%

64

(62)

-

Consolidated Adjusted Net Income²

795

408

95%

191

316%

1,207

1,234

-2%

1 - Accounting measure disclosed in the consolidated Income Statement.

2 - Non-accounting measure calculated by the Company to show net profit adjusted by non-recurring events that influenced the result.

In 3Q20 compared to 2Q20 and 3Q19, the variation in the financial result was basically due to the effects from exchange variation.

Net income in 3Q20 increased in relation to 2Q20 and 3Q19 supported by the growth in EBITDA.

Dividends

Gerdau's Board of Directors approved the payment of dividends in the amount of R$204.1 million (R$ 0.12 per share), which was distributed as an advance on the minimum mandatory dividend for 2020, as stipulated in the Bylaws.

Payment date: November 18, 2020

Record date: shareholding position on November 6, 2020

Ex-dividend date: November 9, 2020

Working Capital & Cash Conversion Cycle

The cash conversion cycle (working capital divided by daily net sales in the quarter) decreased from 95 days in June 2020 to 63 days in September 2020, effectively optimizing working capital after the effects from the covid-19 pandemic, supported by a decrease in inventory days in the period combined with days payable increasing more than days receivable, reflecting the recovery in economic activity and the good conditions for payment terms.

4

This is an excerpt of the original content. To continue reading it, access the original document here.

Disclaimer

Gerdau SA published this content on 30 September 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 October 2020 12:34:03 UTC


© Publicnow 2020
All news about GERDAU S.A.
01/15GERDAU S A : Tax Policy
PU
2020GERDAU S.A. : Ex-dividend day for
FA
2020GERDAU S A : Morgan Stanley Upgrades Gerdau to Overweight From Equal Weight
MT
2020GERDAU S A : Notice to Shareholders - Interest Payment on Capital Stock
PU
2020GERDAU S A : Investor Presentation - November 2020
PU
2020GERDAU S A : Human Rights Policy
PU
2020GERDAU S.A. : Ex-dividend day for interim dividend
FA
2020Harsco Successfully Renews Seven-Year Multi-Million-Dollar Deal With Gerdau
MT
2020GERDAU S A : Anti-Corruption Policy
PU
2020GERDAU S A : Compliance Policy
PU
More news
Financials
Sales 2020 42 422 M 8 014 M 8 014 M
Net income 2020 2 488 M 470 M 470 M
Net Debt 2020 12 159 M 2 297 M 2 297 M
P/E ratio 2020 17,6x
Yield 2020 0,63%
Capitalization 42 021 M 8 005 M 7 938 M
EV / Sales 2020 1,28x
EV / Sales 2021 1,05x
Nbr of Employees 45 000
Free-Float 63,2%
Chart GERDAU S.A.
Duration : Period :
Gerdau S.A. Technical Analysis Chart | GGBR4 | BRGGBRACNPR8 | MarketScreener
Technical analysis trends GERDAU S.A.
Short TermMid-TermLong Term
TrendsBullishBullishBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 15
Average target price 24,68 BRL
Last Close Price 26,08 BRL
Spread / Highest target 22,7%
Spread / Average Target -5,37%
Spread / Lowest Target -42,5%
EPS Revisions
Managers and Directors
NameTitle
Gustavo Werneck da Cunha Chief Executive Officer & Director
Guilherme Chagas Gerdau Johannpeter Chairman
Harley Lorentz Scardoelli Chief Financial Officer & Vice President
André Bier Gerdau Johannpeter Vice Chairman
Claudio Gerdau Johannpeter Vice Chairman
Sector and Competitors
1st jan.Capitalization (M$)
GERDAU S.A.6.67%8 005
ARCELORMITTAL4.39%25 197
POSCO1.10%19 563
NUCOR4.29%16 748
NIPPON STEEL CORPORATION4.59%12 322
TATA STEEL LIMITED9.63%11 150