EALT3

Electro Aço Altona S.A. is a century-old company in the metallurgy sector, with common and preferred shares traded on B3 under the tickers EALT3 and EALT4. Its origins date back to March 8, 1924, in Blumenau (SC), when German engineer Paul Werner, then responsible for installing the city’s first telephone exchange, partnered with blacksmith Ernst Auerbach in the Altona neighborhood. The initial partnership, called Auerbach & Werner, produced household and agricultural items such as cast-iron pans, meat grinders, precision scales and farm implements. In 1933, the acquisition of an electric arc melting furnace marked its definitive entry into the steel foundry business, leading to the name change to Electro Aço Altona S.A. and making the company the first steel foundry in Santa Catarina and one of the pioneers in Brazil.

Over the decades, Electro Aço Altona has broadened its technological scope and product portfolio, keeping pace with the evolution of Brazil’s industrial sector. In the 1940s, it stood out for its innovation in producing steel bells to replace traditional bronze bells, demonstrating its ability to adapt to new demands. In 1950, the company was registered with the Brazilian Securities and Exchange Commission (CVM), consolidating its presence in the Brazilian capital market. In 2024, the company celebrated its 100th anniversary at an event held in Blumenau, underscoring its importance for the regional and national economy and its ongoing track record of investment in technology, industrial modernization and sustainability practices.

Electro Aço Altona’s business model is centered on casting and machining parts in carbon steel and special alloys, operating as a basic industry that supplies components to other industrial segments. The company produces both custom-made and serial parts, meeting the technical specifications of different large-scale projects. Its production capacity reaches 1,250 tons per month in a 120,000-square-meter industrial park, combining arc and induction melting furnaces to produce sophisticated alloys. In addition to the steel castings themselves, the company offers complementary services such as heat treatment, non-destructive testing, X-ray, precision machining and finishing, which allows it to deliver components either ready or in an advanced processing stage to its clients.

In terms of products, Electro Aço Altona manufactures a wide range of metal parts that go into various industrial equipment and systems. Among its main items are rings and bearings; rotors, disintegrators, fittings, casings and pumps; levers, bushings, ladles, cylinders, grinding tracks and rollers; accessories for anchors, eye bolts and connectors; as well as bar links, teeth, cylinder bottoms, crosses, conveyor supports, arms, trestles and forks. The company also develops unlisted products made to order for specific clients, reinforcing the custom-made nature of a significant share of its operations. The production process follows complete metallurgical stages, from pattern making in materials such as wood, plastic or metal, through molding in special sand, alloy pouring, shakeout, gating removal, rough finishing, heat treatments and machining on more than 30 dedicated pieces of equipment.

Electro Aço Altona’s client base consists mainly of other industrial companies, construction firms and power generators, which use its components in industrial and infrastructure projects. The company highlights that it positions itself as a supplier for large, custom projects, placing it in a select group of global companies capable of delivering highly complex steel casting solutions. Within its portfolio, the construction and mining segment is particularly relevant, with two clients in this area each accounting for more than 10% of total net revenue. Together, these two clients represent approximately R$ 190 million in Net Operating Revenue, underscoring the strategic weight of the heavy construction and mining chain in the company’s demand profile.

Electro Aço Altona has a significant international presence in steel casting sales, exporting to more than 25 countries. Foreign revenue is distributed mainly across North America, Latin America, Europe, Asia and Africa. In 2024, the external steel casting market totaled R$ 353.6 million, with North America accounting for the largest share, followed by Europe, Asia and Africa, and to a lesser extent Latin America. To support its internationalization strategy, the company maintains dedicated commercial structures abroad: since 2018 it has operated the Altona Europe office in Germany, focused on expansion in Europe, and since 2023/2024 it has had the Altona North America office in the United States, structured for sales in North America. In Brazil, revenue remains significant, with the domestic market still accounting for the majority share of consolidated net revenue from steel castings.

In addition to its core metallurgy operation, Electro Aço Altona has organized a set of subsidiaries with support roles and operational synergies. Administradora de Bens Altona S.A., created in 2017/2018, is responsible for selling land not belonging to the industrial park and acquiring properties of interest to the group. Modelação Kimze, acquired in 2019 and located in Gaspar (SC), contributes to the pattern-making stage, reducing costs and increasing agility in this critical phase of the casting process. Also in Gaspar, Indústria Magayver, acquired in 2020, produces wooden case-type packaging for protection and transport of parts, allowing greater control over packaging costs and design. In 2022, Altona Engenharia Industrial Ltda. was created, headquartered in Pomerode (SC), dedicated to the development and production of proprietary products, boiler shop services and general industrial fabrications, focusing on heavy structures and machinery and providing direct support to the parent company.

On the regulatory and environmental-social front, Electro Aço Altona operates under a broad framework of local, state and federal laws and regulations, as well as specific certification requirements for supplying Brazilian and foreign clients. The company maintains dedicated environment, health and safety departments responsible for managing issues such as emissions, disposal of hazardous materials, handling of risky inputs and protection of employee health. To operate, it depends on authorizations such as an Operating Environmental License issued by the state environmental agency (FATMA), a Federal Police certificate for the use of certain controlled chemical products, location and sanitary permits, and the Fire Department’s Inspection Certificate. The company states that it constantly monitors environmental legislation and annually allocates budgetary resources for necessary adjustments. In ESG governance and transparency, it publishes an annual sustainability report, available on CVM channels and on its investor relations website, although this document is not yet audited by an independent entity and is in the process of being aligned with more structured practices for disclosing environmental, social and governance indicators.

From a competitive standpoint, Electro Aço Altona operates in a niche where technical expertise in custom projects, combined with the ability to produce special alloys, is a differentiating factor in the competition for global contracts. Its location in Blumenau, with easy access to highways, ports and airports in the South region, favors its export logistics, although the company does not have its own transport fleet, outsourcing shipment of production according to contractual agreements with clients. The company points out that the Brazilian exchange rate increases its competitiveness as an international supplier, while at the same time requiring strict control over the costs of imported inputs such as ferroalloys and certain regulated chemical products. Without dependence on single suppliers and with raw materials based on steel scrap and ferroalloys, the company is exposed to the typical volatility of metal commodities but seeks to mitigate this exposure through purchasing management and relationships with multiple industrial partners.

Finally, Electro Aço Altona adopts a policy of protecting its main brand, “ALTONA”, registered with the National Institute of Industrial Property (INPI) and renewed periodically, and states that it does not make financial contributions to political parties, candidates or initiatives aimed at directly influencing public policy decisions. For investors following the EALT3 and EALT4 shares on B3, this is a company whose value creation is directly tied to the industrial cycle and to demand for high-complexity steel components for construction, mining, energy and other heavy applications, with a significant presence in the foreign market and operations structured around a specialized industrial park and supporting production, logistics and commercial subsidiaries.