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Gerdau narrows Q4, FY'17 losses on lower impairments

Brazilian steelmaker Gerdau SA booked a net loss of 1.38 billion Brazilian reais for the fourth quarter of 2017, narrowing 55% on a yearly basis from 3.08 billion reais. The company's net loss for the full year narrowed 88.2% to 339 million reais, from 2.89 billion reais in 2016.

The company attributed the improved results to lower impairments, which totaled 1.12 billion reais in 2017, compared to 2.92 billion reais in 2016.

Another factor was the operations of Gerdau's subsidiaries and associates, which swung year over year to a profit of 649 million reais in the fourth quarter from a loss of 47 million reais, while full-year income jumped 1,144.8% to 722 million reais.

Net sales for the fourth quarter grew 13.9% year over year to 9.82 billion reais, and adjusted EBITDA jumped 64.9% to 1.18 billion reais. Full-year sales decreased 1.9% to 36.92 billion reais, while adjusted EBITDA rose 6.7% to 4.32 billion reais.

Gerdau's quarterly crude steel production grew 18.7% year on year to 4 million tonnes, and full-year crude steel output improved 2.8% to 16.1 million tonnes.

Steel shipments for the quarter and year dropped 0.7% and 4% year over year, respectively, to 3.8 million tonnes and 14.9 million tonnes.

Net debt totaled 13.13 billion reais as of Dec. 31, 2017, down from 14.50 billion reais at the end of 2016.

CapEx totaled 271 million reais in the fourth quarter, bringing the full-year total to 873 million reais. Gerdau anticipates CapEx of 1.2 billion reais in 2018, with a focus on productivity improvements and maintenance.

The steel major announced a dividend of 3 Brazilian centavos per share, or 51 million reais, for the fourth quarter, taking the year's total to 8 centavos per share, or 136.5 million reais. The dividend will be paid March 21 to shareholders on record as of March 9.

As of Feb. 27, US$1 was equivalent to 3.25 Brazilian reais.