Shareholder’s Guide

Global Presence:

  • Over 110 years of operations in the steel market.
  • One of the most competitive companies in its sector, with operations in 13 countries.
  • Largest producer of long steel in the Americas and the world’s second largest producer.
  • Vertically integrated operations with a flexible production process.
  • Significant market share in the countries where it operates and a broad product offering due coming from its downstream operations and steel fabricating facilities.
  • Solid capital structure and cash flow.
  • Iron ore reserves estimated at 6.3 billion metric tons, which guarantee self-sufficiency and sale of surplus.
Incorporated Companies
Incorporated Companies Emerged with
(succeding co.)
Incorporation g&e shareholders’ meeting date
GERDAU AÇOS ESPECIAIS S.A. GERDAU S.A. Mar.28.2013
GERDAU AMÉRICA LATINA PARTICIPAÇÕES S.A. GERDAU S.A. 29.12.2017
ITAGUAÍ COMÉRCIO, IMPORTAÇÃO E EXPORTAÇÃO LTDA. GERDAU S.A. 29.12.2017
GERDAU COMERCIAL DE AÇOS S.A. GERDAU AÇOS LONGOS S.A. 28.03.2013
AÇOS VILLARES S.A. GERDAU S.A. 30.12.2010
ARMAFER SERVIÇOS DE CONSTRUÇÃO LTDA. GERDAU AÇOMINAS S.A. 29.10.2004
LAMINADORA DO SUL S.A. GERDAU AÇOMINAS S.A. 28.11.2003
GERDAU PARTICIPAÇÕES LTDA. GERDAU S.A. 28.11.2003
CEA PARTICIPAÇÕES S.A. GERDAU S.A. 28.11.2003
COMERCIAL GERDAU LTDA. GERDAU S.A. 26.02.1999
SIDERÚRGICA RIOGRANDENSE S.A. METALÚRGICA GERDAU S.A., E GERDAU S.A. 30.06.1997
CIA. SIDERÚRGICA PAINS GERDAU S.A. 30.06.1997
SIDERÚRGICA AÇONORTE S.A. CIA. SIDERÚRGICA DA GUANABARA – COSIGUA
(ALTERADA A RAZÃO SOCIAL PARA GERDAU .A.)
23.12.1996
USINA SIDERÚRGICA DA BAHIA S.A. – USIBA SIDERÚRGICA AÇONORTE S.A. 30.01.1996
SIDERÚRGICA CEARENSE S.A. USINA SIDERÚRGICA DA BAHIA S.A. – USIBA 29.12.1995
CIA. SIDERÚRGICA DO NORDESTE METALÚRGICA GERDAU S.A. 29.12.1995
SIDERÚRGICA GUAÍRA S.A. SIDERÚRGICA RIOGRANDENSE S.A. 31.05.1995
AÇOS FINOS PIRATINI S.A. SIDERÚRGICA RIOGRANDENSE S.A. 24.02.1995
CIA. SIDERÚRGICA DE ALAGOAS – COMESA USINA SIDERÚRGICA DA BAHIA S.A. – USIBA 28.02.1994
COMPANHIA BRASILEIRA DE FERRO CIA. SIDERÚRGICA DA GUANABARA – COSIGUA 10.04.1992
ICANOR S.A. – ARAMES E CABOS SIDERÚRGICA AÇONORTE S.A. 29.12.1983

Why invest in Gerdau?

For over 110 years, Gerdau has been successfully facing and overcoming challenges as, after all, these give it the strength and experience to build its future. It’s these challenges that strengthen Gerdau, making it increasingly flexible and enabling it to quickly respond to adversities, as well as take advantage of the market opportunities.

The company’s history began in 1901 in the form of a small nail factory in the city of Porto Alegre in Rio Grande do Sul, and is today present in 12 countries across the Americas, Europe and Asia. Currently, Gerdau is the leading producer of long steel in the Americas and one of the world’s largest suppliers of special steel, with an installed capacity of more than 25 million metric tons of steel. It began operating in new market in Brazil with its entry into the production of flat steel, which expanded it product mix and made its operations even more competitive.

Gerdau’s relationship with its more than 110,000 shareholders is guided by the principles of transparency, clarity and speed.

Analysts’ Recommendation

Buy Sell Hold
8 analysts 1 analyst

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To decide on the appropriate moment to buy or sell stock, we advise you to seek the opinion of investment analysts at stock brokerages.

These professionals analyze the economic fundamentals of companies, domestic and international macroeconomic conditions, as well as factors that may influence company results. Based on this analysis, they give their opinion about the best moment to buy or sell stock.

Corporate Governance Best Practices
  • Independent members on the Board of Directors
  • Integrated risk management/ Sarbanes Oxley (SOX)
  • Tag Along (100% ON and PN stock)
  • Differentiated dividend policy
  • Level 1 Corporate Governance of BM&FBovespa
  • New York Stock Exchange
  • LATIBEX
  • Included in several Bovespa indexes: ISE, IGC, ITAG, Ibovespa, IBrx 50 and INDX
How to invest in Gerdau Stock

o invest in stock, you must visit a broker who will advise you and broker the trades on the stock exchange on your behalf. For a list of brokers and their contact information, visit the BM&FBovespa website and go to the BROKERS section.

If you are a novice stock investor, we advise you to visit the BM&FBovespa website which provides useful information for first-time investors, including online courses that will help you become familiar with the stock market.

Note that stocks are considered risky, or variable income, investments and may result in losses or gains of varying degrees, depending on the prices of the shares purchased. That is why, they are not an investment recommended for conservative investors, i.e., those averse to risk.

Dividend Policy

All publicly-held companies pay part of their profits to shareholders as dividends or interest on equity (IOE) in proportion to the number of shares held by them.

Metalúrgica Gerdau S.A and Gerdau S.A. pay dividends and/or IOE equivalent to at least 30% of the year’s adjusted net income, calculated in accordance with the accounting practices in Brazil.

As of March 31, 2003, the Gerdau Group companies have been paying dividends and/or IOE quarterly as advance payment of the mandatory dividend.

Stock dividends and stock splits

Gerdau

Procedure to declare bonus share issue in the individual income tax return (IRPF)?

Bonus share issues should be included in shareholders’ annual income tax return at the unit cost, under Exempt and Non-Taxable Income, in the Profit and Dividends Received line. This amount should be added to the historical cost of shares in the Assets and Rights section.

Example:
On January 1, 2008, a shareholder held 1,000 preferred shares of Gerdau S.A. (GGBR4), which were declared in his income tax return at the cost of R$20,000.00 (amount paid to buy said shares).

On May 30, 2008, a bonus issue of 100% was approved, to be credited to shareholders according to their shareholding on June 12, 2008.

If the shareholder had maintained his position (1,000 shares), he received 1,000 bonus shares (a 100% bonus applied to the 1,000 shares held) and now holds 2,000 shares.

As published in the Notice to Shareholders, the unit cost of each bonus share of Gerdau S.A. was R$4.88. As a result, the total cost of the bonus shares received by this shareholders is R$4,880.00 (unit cost of R$4.88 multiplied by the 1,000 bonus shares received).

This amount must be declared in the income tax statement under the Exempt and Non-Taxable Income section, in the Profit and Dividends Received line, as well as added to the historical cost of shares in the Assets and Rights section.

In the above example, the shareholder who, on December 31, 2007, had declared in his income tax return a historical cost of R$20,000.00 for the ownership of 1,000 shares, now has a cost of R$24,880.00 for his 2,000 shares.

When he sells these 2,000 shares, he should consider the new historical cost for the shares, i.e., R$24,880.00 when calculating the income tax on capital gains.

Programs and Tools for Investors

Information - Bank of New York Mellon

Search through a list of direct ADR purchase plans and dividend reinvestment plans using InvestDirect Search. For further information contact Bank of New York Mellon by phone or E-mail as below:

Contact by Phone

Assistance with Investor ServiceDirect® or for Technical Support

Technical Support Assistance is available from 9:00 a.m. to 7:00 p.m. Eastern Time Monday thru Friday.

Call 1-877-978-7778 (U.S. & Canada).

Customer Service for Other Companies or General Questions

Customer service representatives are available from 9:00 a.m. to 7:00 p.m. Eastern Time Monday thru Friday.

Call 1-800-522-6645 (U.S. & Canada).If you are calling from outside the U.S. and Canada, please call us at 1-201-329-8660. TDD callers, please call us at 1-800-231-5469.

Contact by E-mail

Customer service for all other companies or for general questions – E-mail shrrelations@bnymellon.com

Quotation History / Investment Simulator

The Investment Simulator allows investors to calculate the yield on their investments over a period of time.

The Quotation History and Interactive Chart tools enable shareholders to view stock performance easily and quickly.

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Gerdau Dividend Reinvestment Plan (DRIP)

To provide an alternative for investing dividends to acquire new shares on the secondary stock market (Bovespa and NYSE)

Benefits to Shareholders:

  • Automatically reinvest your dividends
  • Decide to reinvest only a portion of your dividend, receiving cash for the remaining part
  • Make voluntary cash investments to purchase additional ADRs, paying little or no brokerage commission/fees
  • Increase your stock holdings
  • Generate additional dividend income with your increased stock holdings
  • Receive a comprehensive statement after each transaction

Glossário

  • Holding company:

A company whose main objective is to control one or more companies and does not normally carry out operations.

  • Level 1 Corporate Governance:

It is a special listing segment of BM&FBovespa created to offer a trading environment that stimulates investor interest and recognition of companies.

  • Tag along:

Right that guarantees minority shareholders the same conditions offered to controlling shareholders in the case of sale of company control.

  • Interest on Equity:

Corresponds to the portion of the company’s profit distributed to shareholders in proportion to their interest. The minimum amount of profit to be distributed is proposed by the Board of Directors, approved at the Shareholders’ Meeting and fixed in the Bylaws.

Interest on equity is interest paid or credited individually to shareholders as remuneration for their capital, and is calculated on the equity accounts and limited to the pro rata die variation of the long term interest rate (TJLP). In order to be distributed and deductible from the calculation base for the company’s income and social contribution taxes on net income, the company needs to have profit in the base period related to the payment or credit, or accumulated earnings and reserves of profits from previous years. According to law, interest on equity may replace dividends.

Interest on equity is subject to withholding income tax of 15%. For individuals, it is considered as conclusive taxation (exclusively at source) and should be specified in line 8, under Income Subject to Exclusive/Conclusive Taxation (2011 individual income tax declaration).

  • Dividends:

Correspond to the portion of the company’s profit distributed to shareholders in proportion to their interest. The minimum amount of profit to be distributed is proposed by the Board of Directors, approved at the Shareholders’ Meeting and fixed in the Bylaws.

Dividends are calculated based on adjusted net income, in accordance with the applicable law and are exempt from withholding income tax. In the income tax declaration of the beneficiary, dividends must be declared under line 5 of the Exempt and Non-Taxable Income section (2011 individual income tax declaration).

Dividends distributed are not considered deductible expenses when calculating the company’s income and social contribution taxes on net income as they are considered distribution of profits, already taxed.

  • Payout:

Shows how much (percentage) of the company’s adjusted net income is distributed to shareholders as dividends or interest on equity.

  • Yield:

It is the ratio of the dividend and/or interest on equity paid per share of a company and the market price of the same share at the end of a specific period. The higher the dividend yield, the higher is the return on investment for the shareholder.

  • Stock Dividends:

These are issues of new shares of a company resulting from the capital increase through the incorporation of reserves. These new shares are distributed freely to shareholders in proportion to their shareholding position.

Last update: April 2, 2020
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