Gerdau (GGBR4) Q3 2025 earnings summary

Executive summary

• North America delivered record EBITDA, contributing 65% of consolidated results, with shipment growth over 10% year-over-year and resilient demand, while Brazil faced margin pressure from high steel imports and oversupply.

• Steel shipments reached up to 3.1 million tonnes, and net sales increased to R$18.0 billion, with net income rising 26% year-over-year to R$1.1 billion.

• Free cash flow was R$1.0 billion, supported by a R$300 million working capital release and improved cash conversion cycle.

• The sustainable mining project in Miguel Burnier reached 90% completion, with integrated operations set for early 2026.

• Dividends of R$555 million (R$0.28/share) and buybacks representing 88% of the program were approved.

Financial highlights

• Adjusted EBITDA reached R$2.7 billion, up 7% sequentially, with margin improving to 15.2%, driven by North and South America.

• Earnings per share increased to R$0.54, and adjusted net income margin was 6.1%.

• Net debt/EBITDA improved to 0.81x, with gross debt expected to fall to around R$14 billion by year-end.

• CAPEX for Q3 was R$1.7 billion, with 60%–77% allocated to competitiveness and mining projects; 2026 guidance is R$4.7 billion, a 22% reduction from 2025.

• Q3 payout (dividends + buybacks) was 75% of net income, with 88% of the buyback program completed.

Outlook and guidance

• North America is expected to maintain strong steel demand, with positive outlook for 2026 in solar, data centers, and infrastructure, though some volume reduction is anticipated due to seasonality.

• Brazil faces continued challenges from high import penetration and seasonality, but operational efficiency and potential trade defense measures may support recovery in 2026.

• Ongoing focus on operational efficiency, cost management, and disciplined capital allocation.