GGBR4

Gerdau S.A. is a Brazilian corporation, incorporated in 1961 under the laws of Brazil and headquartered in São Paulo (SP), whose origins date back to 1901 with the Pontas de Paris nail factory in Porto Alegre. This initial unit was later renamed Metalúrgica Gerdau S.A., which today is a holding company controlled by the Gerdau family and the direct parent of Gerdau. Over more than a century, the company has significantly expanded its production base and international presence, becoming one of the leading steel groups in the world. Gerdau’s shares are traded on B3 under the tickers GGBR3 and GGBR4, and also on the New York Stock Exchange (NYSE), which reinforces its access to the global capital markets.

Gerdau’s business is primarily focused on the production and sale of steel products in general, operating steel mills in Brazil, Canada, the United States, Argentina, Peru, Uruguay and in Mexico (through a joint venture). The company is Brazil’s largest steel producer and is among the world’s leading suppliers of special steel for the automotive sector, according to its own assessment. In Brazil, in addition to long steel, Gerdau also produces flat steel and iron ore, which broadens its product mix and influences the competitiveness of its local operations. As of December 31, 2024, the company reported consolidated assets of R$ 86.8 billion, shareholders’ equity (including non-controlling interests) of R$ 58.2 billion, consolidated net sales of R$ 67.0 billion and consolidated net income of R$ 4.6 billion.

Gerdau’s operating structure is organized into four business segments: Brazil, North America, South America and Special Steel. The Brazil Segment encompasses the steel operations in the country (except special steels) and the iron ore operation, with capacity of approximately 6.8 million tonnes per year of crude steel and 6.6 million tonnes of finished products. The North America Segment includes all operations in Canada and the United States (except special steels), as well as the jointly controlled entity in Mexico, operating a vertically integrated network of 10 steel mills, scrap recycling units and downstream operations. The South America Segment concentrates activities in Argentina, Peru and Uruguay, while the Special Steel Segment brings together plants in Brazil and the United States, in addition to Gerdau Summit Aços Fundidos e Forjados S.A., which changed from a joint venture to a subsidiary after the acquisition of 100% of its share capital, completed in February 2025.

Gerdau’s portfolio covers a wide range of steel products. Among semi-finished goods, the company produces billets, blooms and slabs, which serve as inputs for rolling into wire rod, rebar, bars and other flat steels and shapes. In common long steels, items such as rebar, wire rod, bars and light and structural shapes are mainly directed to the construction and manufacturing industries. The company also operates in drawn products, such as smooth, barbed and galvanized wire, fences, wire mesh, nails and staples, sold primarily to the construction, agricultural and manufacturing sectors. In special steels, production is focused on applications with high mechanical requirements, heavily used in the automotive chain (auto parts and systems for light and heavy vehicles and agricultural machinery) and present in segments such as oil and gas, wind power, machinery and equipment, mining and rail.

In addition to long and special steels, Gerdau produces flat steel at its integrated mill in Ouro Branco, Minas Gerais, which manufactures hot-rolled coils and heavy plates for both the domestic and export markets. The company also resells flat steels produced by other Brazilian manufacturers, adding value through further processing at its flat steel service centers and through its distribution channel. In the mining segment, the company owns two iron ore mines in Minas Gerais (Várzea do Lopes and Miguel Burnier), with certified reserves of 476 million tonnes of iron ore at the Miguel Burnier mine, according to a report by SRK Consulting. Production includes sinter feed, pellet feed/concentrate, hematitinha and lump ore, with a significant portion destined for internal consumption, especially at the Ouro Branco mill.

Gerdau’s geographic footprint is diversified, with 29 steel production units worldwide and consolidated shipments of 10.984 million tonnes in 2024, distributed among Brazil, North America, South America and Special Steel. Most of its production is directed to the local markets where the company operates, reducing logistics costs and exposure to trade barriers. Even so, Gerdau exports part of its output and maintains relationships with customers in more than 50 countries across five continents. The company is subject to regulations in each market, including trade defense measures. In the United States, for example, certain Brazilian flat products have faced antidumping and countervailing duties since 2016 and 2017, as well as the impacts of Section 232 measures applied in 2018. In the European Union, Brazilian hot-rolled products have been subject to antidumping duties since 2017 and to safeguard measures on certain steel products since 2019, although with a progressive reduction in the categories affected and without incidence on products that Gerdau manufactures in Brazil.

From an industrial standpoint, Gerdau operates both integrated mills and mini-mills (semi-integrated plants). Globally, the company predominantly uses mini-mills, with 27 units equipped with electric arc furnaces that melt steel scrap, reinforcing its role as a recycler – the company states it is the largest recycler in Latin America, transforming millions of tonnes of scrap into steel every year. In Brazil, in addition to mini-mills, Gerdau operates three integrated mills (although one of them, Barão de Cocais, has had production suspended since 2024), with processes based on blast furnaces and LD converters. The Divinópolis unit stands out for using charcoal, produced sustainably on the company’s own farms, as an input for transforming ore into metallic iron, a route associated with lower greenhouse gas emissions compared with thermal coal.

The company depends on a broad set of government licenses and permits for its industrial, mining and forestry operations, and is regulated by environmental agencies and, in the case of mining in Brazil, by the National Mining Agency (ANM) and the Brazilian Mining Code. Mining activities are subject to the Financial Compensation for the Exploitation of Mineral Resources (CFEM), with a rate of 3.5% on iron ore, levied on gross sales revenue or current price, depending on the type of operation. Gerdau holds mining rights covering 8,837.19 hectares in Minas Gerais, with concessions valid until deposit depletion, subject to compliance with annual legal requirements. In terms of environmental, social and governance (ESG) practices, the company has a Sustainability Policy, Corporate Environmental Guideline and Environmental Management System, seeking to optimize the use of natural resources, manage impacts and meet the regulatory specificities of each region. Gerdau publishes an Annual Report aligned with the IIRC, GRI and SASB (Iron & Steel Producers and Metal & Mining) frameworks, assured by a third party, in which it presents its financial performance and its initiatives in governance, environment, social responsibility, health, safety and people management.

For individual investors interested in GGBR3 and GGBR4 shares on B3, Gerdau presents itself as a global steel company, with significant exposure to steel and iron ore cycles, geographic diversification across the Americas and operations in various end markets such as construction, manufacturing, agribusiness and the automotive sector, in addition to mining integrated with part of its operations in Brazil. Its model combines scrap-based mini-mills, integrated mills and mining assets, under strict environmental and mining regulatory oversight, and with structured disclosure of ESG information to the market.