Metalurgica Gerdau (GOAU4) Q4 2025 earnings summary

Executive summary

• North America delivered strong results in 2025, with EBITDA up 18.5% year-over-year and record shipments, while Brazil faced profitability challenges due to record steel imports and increased competition.

• Steel shipments reached 11.6 Mt in 2025, a 5.9% increase, with positive performance across all regions.

• The Miguel Burnier mining project achieved 91% physical progress and is expected to reduce production costs at Ouro Branco.

• Fourth quarter 2025 results showed resilience in North America, offsetting seasonal and competitive pressures in Brazil, with consolidated steel shipments down 7% and net sales down 6% year-over-year.

Financial highlights

• 2025 EBITDA reached R$10.1 billion, down 7% year-over-year, mainly due to a challenging Brazilian market, while North America offset weaker results elsewhere.

• Adjusted net income for 2025 was R$3.4 billion, a 21% decrease from the previous year, excluding R$2.0 billion in non-cash impairment losses in Brazil.

• Free cash flow for Q4 2025 was R$1.4 billion, turning annual cash flow positive at R$394 million.

• CapEx for 2025 totaled R$6.1 billion; guidance for 2026 is R$4.7 billion, reflecting a reduction to enhance free cash flow.

• Dividends and share buybacks in 2025 totaled R$2.4 billion.

Outlook and guidance

• Moderate demand growth expected in Brazil for 2026, with optimism around new trade defense measures and focus on infrastructure and civil construction.

• North America anticipated to maintain high steel consumption and strong order backlogs, especially in infrastructure, solar, and data centers.

• CapEx for 2026 set at R$4.7 billion, with focus on competitiveness, maintenance, and cost reduction.

• Potential for double-digit EBITDA margin in Brazil by year-end 2026, contingent on Miguel Burnier ramp-up and stable market conditions.