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Long winter hits Gerdau's N. American results

Keywords: Tags  Gerdau, net sales, quarterly earnings, North America, net sales, profit margins, steel, Samuel Frizell

NEW YORK — Gerdau SA’s global first-quarter sales remained flat year on year at about 9.2 billion reais ($4.6 billion) even as the company’s North American operations excluding Mexico and its specialty steel operations recorded a decline due to a severe winter and poor demand.

Net sales for the São Paulo-based company’s North American operations excluding Mexico and specialty steels dropped 7 percent in the first quarter to 2.93 billion reais ($1.46 billion) compared with 3.14 billion reais in the year-ago period, the company reported May 7.

The lower sales came as Gerdau’s North American segment saw steel production fall 22 percent year on year to 1.47 million tons as a harsh winter tightened demand, the company said.

"In the North America (business operations), production was reduced to adapt to the level of inventories and the weaker demand caused by the more severe winter in the first quarter of 2013 compared to the first quarter of 2012," the company said.

Gross profits for the North American division totaled 171 million reais ($85.2 million) in the first quarter, a 49-percent drop from profits in the same quarter of 2012.

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