PATI3: quote, dividends and indicators for Panatlântica

Panatlântica is a Brazilian company in the steel sector, focused on the processing and distribution of flat and long steel, whose shares are traded on B3 under the tickers PATI3 and PATI4. The company originated in 1967 from the merger of Cia. Panatlântica de Comércio do Rio Grande into Indústria de Laminados do Rio Grande S.A., both incorporated in 1961 and controlled by the same group. In 1971, the company became a publicly held corporation, consolidating its presence in the capital markets. Its industrial headquarters are located in the Industrial District of Gravataí, in the state of Rio Grande do Sul, in a manufacturing complex that has been modernized over the decades, with capacity expansion and the introduction of new equipment for steel cutting, rerolling and forming.

Panatlântica’s corporate and operating structure has been expanded through the opening of branches and the creation and acquisition of subsidiaries. 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., strengthening the company’s presence in Southern Brazil. In 2007, the first industrial plant of Tubospan S.A. was installed in São Francisco do Sul, also in Santa Catarina, and in the first quarter of 2008, the plant in the Glorinha branch, in Rio Grande do Sul, was inaugurated. In 2013, Panatlântica acquired 100% of the share capital of Atkore International Indústria e Comércio de Aço e Materiais Elétricos Ltda., based in Caxias do Sul, which was renamed Panatlântica Indústria e Comércio de Tubos S.A., specialized in the production of mechanical and sprinkler pipes, conduits, slitter, sheets and structural profiles. Also in 2013, Panaser S.A. was inaugurated in Farroupilha, in Rio Grande do Sul, and was later merged into Panatlântica Indústria e Comércio de Tubos S.A., which converted it into a branch. In 2022, this subsidiary opened a branch in Campo Limpo Paulista, in the state of São Paulo, expanding its industrial park in 2025.

Panatlântica’s business model is concentrated in a single operating segment, based on the processing and commercialization of steel products, mainly steel sheets, coils and tubes. The basic raw materials are steel coils from domestic steel mills, in different widths, thicknesses and physical-chemical specifications, suitable for multiple industrial applications. The coils can be heavy plate, hot-rolled, cold-rolled, pickled and oiled, galvanized, galvalume or pre-painted. The company operates both in the resale “in natura” of these coils and in reprocessing through cross-cutting and slitting lines, cold rerolling and continuous forming, adding value to the original material according to each customer’s needs.

From these coils, Panatlântica produces a range of steel derivatives. In cross-cutting, the coils are transformed into steel sheets of various sizes. These sheets can be cut into strips, blanks or bent profiles, preserving the characteristics of the original coils. In slitting, the final product is strip in coil form, which can be sold in rolls or used as input for the manufacture of welded pipes, continuous profiles and for cold rerolling processes that confer new physical-chemical properties to the steel. Coils with special coatings, such as galvanized, galvalume and pre-painted, can be formed in continuous lines to produce metal roofing tiles intended for roofing and wall cladding. In the tubes and profiles segment, especially through Panatlântica Indústria e Comércio de Tubos S.A., operations include mechanical tubes, sprinkler pipes, conduits and structural profiles, expanding the portfolio of steel solutions.

Panatlântica’s customer base is diversified and distributed across various industrial sectors, which reduces dependence on a single demand segment. The company’s steel coils and derivatives are supplied to leather-footwear, electrical and electronics, home appliance, civil construction, shipbuilding, machinery and agricultural implements manufacturers, as well as the metal-mechanic sector in general. Sales are directed to a large number of companies, with no relevant concentration: no individual customer accounts for more than 10% of net revenue. This dispersion is cited by the company as a factor of commercial flexibility, as it allows specific risks from certain industrial segments to be diluted. The commercial process takes place mainly through representatives with defined areas of operation, who negotiate and forward purchase orders to the company.

From a geographic standpoint, Panatlântica has a strong presence in Southern Brazil, with units in Rio Grande do Sul and Santa Catarina and expansion to the Southeast with the branch in Campo Limpo Paulista, in the state of São Paulo. The company serves customers throughout the Brazilian territory, operating as a link in the steel distribution chain between steel mills and manufacturing industries. Imports of raw materials represent a small portion of its purchases, around up to 1% of the total, reinforcing its dependence on domestic steel suppliers. Exports, directed mainly to Mercosur countries, reach at most 6.5% of total sales, and in recent fiscal years foreign revenues have accounted for less than 4% of net revenue, which characterizes Panatlântica as a company essentially focused on the domestic market.

Panatlântica’s industrial operation is sensitive to the continuity of supply of critical inputs such as electricity, heavy transport, oils and lubricants. Shutdowns at supplying steel mills, significant interruptions in transportation or power cuts can completely compromise production, while shortages of oils and lubricants tend to affect specific lines in the short term and, over a longer horizon, the entire plant. On the other hand, the company adopts preventive maintenance routines, seeking to reduce unplanned stoppages without undermining production planning. In terms of quality management, Panatlântica maintains a documented system certified under ISO 9001:2015, under number 130780-2013-AQ-BRA-INMETRO, evidencing standardized processes aimed at consistency in the products delivered to the various industrial segments served.

In the environmental, social and governance (ESG) sphere, Panatlântica is in the process of adapting to new regulatory requirements for sustainability disclosure. The company plans to implement, in the coming years, the international IFRS S1 and IFRS S2 standards for reporting sustainability and climate risk information, seeking alignment with international practices and ensuring materiality and relevance in the indicators chosen. The company has hired specialized consultants to support the preparation of a materiality matrix and the definition of key ESG performance indicators. So far, there is no regular disclosure of specific ESG reports or greenhouse gas emission inventories, and adherence to recommendations from entities such as the TCFD is still under evaluation. At this stage, the company indicates a movement toward structuring and formalizing its ESG agenda, focusing on converging to widely accepted standards in the global market, without, however, yet detailing public targets or specific commitments.