PATI3

Panatlântica is an industrial company with a long track record in the steel processing sector in Brazil. Its origin dates back to 1967, when it was formed through the merger of Cia. Panatlântica de Comércio do Rio Grande into Indústria de Laminados do Rio Grande S.A., both founded in 1961 under the same controlling group. In 1971, the company became a publicly held corporation, and its shares started trading in the capital markets. Currently, the company’s common and preferred shares are traded on B3 under the tickers PATI3 and PATI4, which places Panatlântica within the universe of companies accessible to both retail and institutional investors. Throughout its history, the company has expanded and modernized its industrial facilities, seeking to adapt to the demands of different segments of Brazilian industry.

Panatlântica’s industrial headquarters is located in the Industrial District of Gravataí, in the state of Rio Grande do Sul, in facilities described as large and modern, structured to operate as part of an accredited distribution network for steel products. The company positions its sales in a highly diversified way across various industrial activities, which reduces dependence on a single economic sector or on large client concentrations. According to information from the reference form, the largest customer accounts for approximately 5% of sales, and there is no individual buyer with a share greater than 10% of net revenue. This demand diversification profile is a relevant element for investors when assessing Panatlântica’s exposure to specific cycles in certain industrial sectors.

Over time, Panatlântica has structured a group with subsidiaries and branches to increase its production and logistics capacity. In 1986, the former branch in Joinville, in the state of Santa Catarina, was converted into a wholly owned subsidiary under the corporate name Panatlântica Catarinense S.A. Subsequently, the company opened new branches in the South Region and, in 2007, installed the first industrial pavilion of Tubospan S.A. in São Francisco do Sul (SC). In the first quarter of 2008, the pavilion of the Glorinha (RS) branch was inaugurated. In 2013, Panatlântica acquired 100% of the share capital of Atkore International Indústria e Comércio de Aço e Materiais Elétricos Ltda., headquartered in Caxias do Sul (RS), which was renamed Panatlântica Indústria e Comércio de Tubos S.A., focused on mechanical and sprinkler pipes, conduits, slitter, plates and structural profiles. Also in 2013, Panaser S.A. was inaugurated in Farroupilha (RS), with the purpose of decentralizing industrial activities and providing faster and better customer service. In 2019, the company acquired Induminas S.A., in Contagem (MG), which was later merged in September 2024, with the related property sold in October 2024. In 2022, the branch of Panatlântica Indústria e Comércio de Tubos S.A. in Campo Limpo Paulista (SP) was inaugurated, reinforcing its presence in important industrial hubs in the country.

Panatlântica’s business model is based on the processing and commercialization of steel products, with steel plates and coils acquired from domestic steel mills as its main raw materials. These coils may be heavy, hot-rolled, cold-rolled, pickled and oiled, galvanized, galvalume or pre-painted. The company may sell these materials “as is” or reprocess them internally to add value according to customer specifications. Coils can be leveled and transversely cut, resulting in steel plates of various sizes, or longitudinally cut, generating strips in coils. From these plates it is possible to produce slit strips, blanks, bent profiles and other formats intended for multiple industrial applications. The strips in coils may be sold directly or used as raw material to manufacture welded tubes, continuous profiles or cold rerolling, adjusting their physical-chemical properties for specific uses.

In addition, Panatlântica uses coils with special coatings, such as galvanized, galvalume and pre-painted, for continuous forming processes that result in metal roofing sheets used in roofing and side cladding in civil construction and industrial structures. The activities of Panatlântica Indústria e Comércio de Tubos S.A. complement this chain, focusing on mechanical and sprinkler pipes, conduits, slitter, plates and structural profiles, expanding the portfolio of processed steel products. Although the company has different production units and subsidiaries, it identifies its total operation as a single operating segment for management reporting purposes, which indicates that revenue generation is concentrated in an integrated steel processing and distribution chain, rather than in completely distinct lines of business.

Panatlântica mainly serves industrial sectors and works predominantly on a made-to-order basis, according to the technical specifications of its customers. The steel coils processed by the company are destined for industries in the leather-footwear, electronics, home appliances, civil construction, shipbuilding, agricultural machinery and implements, and general metalworking segments. These sectors demand products with specific widths, thicknesses and physical-chemical properties, which reinforces the company’s role as a supplier of specialized inputs at the beginning of the production chain. Imports of raw materials account for at most 1% of total purchases, which shows a strong dependence on the domestic steel industry. Exports represent at most 6.5% of total sales, focused mainly on Mercosur countries, while revenue from abroad has accounted for less than 4% of net revenue over the last three fiscal years, maintaining the predominantly domestic profile of its operations.

From a geographical standpoint, Panatlântica serves customers throughout Brazil, with product sales carried out by commercial representatives with predefined territories. These representatives negotiate with customers and pass purchase orders on to the company, which adjusts its production to the specific orders. The industrial and commercial structure is concentrated in the South and Southeast of the country, with units in Rio Grande do Sul, Santa Catarina, Minas Gerais (until the sale of the property related to Induminas) and São Paulo, which facilitates access to important industrial and logistics hubs. The company also states that shutdowns at steel mills, in heavy transport or in the electricity supply can completely interrupt production, and that shortages of oils and lubricants also affect production lines over different time horizons, factors that are relevant for assessing operational risks.

Regarding management systems and operational governance aspects, Panatlântica maintains a documented quality system in compliance with ISO 9001:2015, certified under no. 130780-2013-AQ-BRA-INMETRO. This system guides production and quality control processes in its industrial lines, supporting the consistency of products supplied to the different sectors served. In the social and environmental field, the company states that it is embedded in the life of the communities where it operates, generating material and intangible wealth and complying with social and environmental laws established by the competent authorities. On the other hand, the company reports that it does not publish a sustainability report, justifying that it has not yet assessed the topic in the depth required as a determining factor for leveraging its business. For investors analyzing PATI3 and PATI4 shares on B3, these elements help form a picture of the company’s maturity in quality, social and environmental responsibility, and transparency regarding non-financial information.