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New York – June 13 th , 2003

JP Morgan. New York – June 13 th , 2003. STEEL SECTOR WORLD Brazil GERDAU S.A. CONSOLIDATED Highlights Consolidated Figures Outlook Capital Markets. In million metric tons. 2002. 2001. Var. 1 st. China. 2 nd. Japan. 3 rd. USA. 4 th. Russia. On 1Q 2003 Brazil produced

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New York – June 13 th , 2003

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  1. JP Morgan New York – June 13th, 2003

  2. STEEL SECTORWORLD Brazil GERDAU S.A. CONSOLIDATED Highlights Consolidated Figures Outlook Capital Markets

  3. In million metric tons 2002 2001 Var. 1st China 2nd Japan 3rd USA 4th Russia On 1Q 2003 Brazil produced 7.5 million tons, 6.9% more than in the 1Q 2002. 5th South Korea 6th Germany 7th Ukraine 8th Brazil 9th India 10th Italy Other Total WORLD PRODUCTION Crude Steel Source: IISI 3

  4. LARGEST PRODUCERS Crude Steel 2002 In million metric tons Gerdau pro forma Output in 2002: 11,3 million tons (including 12 months of Co-Steel) Source: Metal Bulletin 4

  5. US$/ton. 360 US$ 344 Slabs 300 US$ 322 Bars 1S 2002 (USA)Scrap price+37% US$ 306 Wire rod US$ 294 Rebars 260 1S 2002 (USA)Pig Iron price+17% 200 Jan. 02 Jul. 02 Jan. 03 Jan. 01 Jul. 01 INTERNATIONAL PRICES FEB 2003 (USA) SCRAP PRICE US$ 114 / TON PIG IRON US$ 160 / TON 1S 2002Price increases: 39% in slabs 10% in bars13% in wire rod16% in rebars 1Q 2003Price increases:5% in slabs 11% in bars 12% in wire rod12% in rebars Source: MEPS/ USGS / AMM 5

  6. STEEL SECTORWorld Brazil GERDAU S.A. CONSOLIDATED Highlights Consolidated Figures Outlook Capital Markets

  7. BRAZILIAN STEEL SECTOR 2002 2001 Var. Steel companies Crude Steel output (million tons) Revenues (US$ billion) Exports (US$ billion) Number of employees (thousand) Steel apparent consumption (million tons) Crude steel per capita consump. (kg/inhab.) World Ranking Source: IBS 7

  8. Usiminas/Cosipa 8,447 Belgo/CST/Acesita (Arcelor) 8,439 5,999 Gerdau/Açominas CSN 5,107 Aços Villares 700 V&M do Brasil 500 Barra Mansa 387 CRUDE STEEL OUTPUT Brazil - 2002 • In 2002, the output of crude steel reached 29.6 million tons compared to 26.7 million in 2001, an increase of 10.8%. • Consolidating companies by economic groups, Gerdau is the 3rd largest producer in Brazil. Individually, Gerdau ranks 5th and Açominas 7th. BRAZILIAN CRUDE STEEL OUTPUT PER ECONOMIC GROUP In thousand tons 1Q 2003 Usiminas/Cosipa – 2,083 Arcelor – 2,079 Gerdau – 1,675 CSN – 1,272 Source: IBS 8

  9. Gerdau/Açominas3,660 K ton. – 48.0% V&M do Brasil – 442 K ton. – 5.8% Aços Villares – 421 K ton. – 5.5% Belgo/CST/Acesita(Arcelor) – 2,735 k ton. 35.9% Barra Mansa – 367 K ton. – 4.8% ROLLED PRODUCTS OUTPUT Brazil - 2002 • Output of long steel, sector in which Gerdau is present, totaled 7.6 million tons in 2002. This is an increase of 4.7% compared to 2001, when output reached 7.3 million tons. 1Q 2003 Gerdau – 921 K ton. – 49% Arcelor – 677 K ton. – 36% Source: IBS 9

  10. EXPORTS Flat Products 2.2M t – 18.7% Long Products 1.2M t – 10.2% Other Products 0.5M t – 4.5% Semi-finished 7.8M t – 66.6% TONS SHIPPED Brazil - 2002 DOMESTIC MARKET TOTAL SHIPMENTS WERE 27.5 MILLION TONS IN 2002, 10,1% HIGHER THAN IN 2001. OF THIS TOTAL, 58% WENT TO THE DOMESTIC MARKET AND 42% TO EXPORTS. Long Products 6.7M tons 42.6% Flat Products9.1M tons 57.4% • Exports of flat steel increased most: 46.6%; semi- finished products increased 22.2%; long products increased 17.3% • Total volume exported increased by 25.8% in 2002, reaching 11.7 million tons. 10 Source: IBS

  11. 11,686 US$/t 315.0 9,599 10,017 US$/t 250.6 9,291 8,741 US$/t 283.1 US$/t 245.6 US$/t 236.1 1,076 930 886 642 672 1998 1999 2000 2001 2002 Imports Exports Exports US$/ton IMPORTS & EXPORTS Brazil - 2002 In thousand metric tons 1Q 2003 - EXPORTS US$ 281.2 / ton Dec02 / Dec01 Increases in export prices Billets +33,2% Slabs +33,7% Bars +7,4% Rebars –4,0% In 2002 exports increased by 25,8%. The devaluation of the real and the price increases in the international markets were the main variables in explaining this growth. Source: IBS 11

  12. LONG PRODUCTS 2002 Imports0,2M tons 3.3% Domestic sales6.8M tons 96.7% 16.7 16.5 7.0 Long Products 7.0 FLAT PRODUCTS 2002 Flat Products 9.7 9.5 Imports0.4M tons 4.7% Domestic sales9.1M tons 95.3% 2001 2002 APPARENT CONSUMPTION Brazil - 2002 • Apparent consumption in 2002 decreased 1,1% compared to 2001, basically due to the reduction in demand for flat steel (-1,8%). • Long steel products represent 42% of apparent consumption. Source: IBS 12

  13. STEEL SECTORWorld Brazil GERDAU S.A. CONSOLIDATED Highlights Consolidated Figures Outlook Capital Markets

  14. Highlights • 102 years of tradition focused on the production of steel in mini-mills and in the distribution of steel products. • Installed capacity of 14 million metric tons of crude steel. • 19th largest world steel producer according to Metal Bulletin Magazine (15th including 12 months of Co-Steel) . • Largest long steel producer in the Americas. • Gerdau S.A. is listed on the Brazilian Stock Exchanges, on the NYSE and on the Latibex (Madrid Stock Exchange). Gerdau Ameristeel Corp. is listed on the Toronto Stock Exchange. • 10 units in Brazil, 12 abroad and 2 strategic shareholdings (Sipar and Gallatin Steel). • 68 sales points in Brazil (Comercial Gerdau). • 17 downstream operations and special sections (5 in Brazil e 12 in North America). • 26 fabrication shops (9 in Brazil, 03 in South America and 14 in North America). • 4 service centers for flat steel in Brazil (Comercial Gerdau). 14

  15. Cambridge, ON (Courtice) MRM Special Sections Whitby, ON Perth Amboy, NJ Sayreville, NJ Gallatin County, KY HO GERDAU AMERISTEEL Charlotte, NC Whitby, ON Cartersville, GA Jacksonville, FL Knoxville, TN Jackson, TN Gerdau Ameristeel Corp. GERDAU S.A. Cearense AÇOMINAS Açonorte Usiba AZA LAISA Divinópolis SIPAR Açominas Gerdau S.A. Cosigua Açominas Guaíra Riograndense Piratini Geographical Distribution • ABROAD • 7.0 MILLION TONS OF CRUDE STEEL PER YEAR • 6.8 MILLION TONS OF ROLLED PRODUCTS PER YEAR Barão de Cocais • BRAZIL • 7.4 MILLION TONS OF CRUDE STEEL PER YEAR • 4.8 MILLION TONS OF ROLLED PRODUCTS PER YEAR 15

  16. Capacity & Products 2003 In thousand metric tons Crude Steel Rolled Products Products Billets, rebars, merchant bars, profiles, wire rod, drawn products, nails, specialty steel. Billets, slabs, blooms, rebars,merchant bars, profiles and structurals. Rebars, merchant bars, profiles and wire rod Rebars, merchant bars, profiles, wire rod, downstream products, special sections and flat products. 16

  17. Co-Steel 2002 Part. Açominas 1997 Usiba1989 Piratini1992 Crude Steel AmeriSteel USA 1999 Pains1994 Sipsa Argentina1997 Barão de Cocais1988 CearenseGuaíra1982 Rolled Products Part. Sipar Argentina 1998 MRM Canada 1995 Hime1985 Aza Chile 1992 Courtice Canada 1989 Laisa Uruguay 1981 Açominas (control) 2002 1980 1984 1988 1992 1996 2000 2002* * 100% of Co-Steel Output Evolution Growth Average Rate 1980 - 2002 CRUDE STEEL 10.4% year ROLLED PRODUCTS 9.6% year • Objectives • Strategies • Evolution • Main Events • Gerdau Ameristeel Corp. • Challenges and Forecasts 17

  18. STEEL SECTORWorld Brazil GERDAU S.A. CONSOLIDATED Highlights Consolidated Figures Outlook Capital Markets

  19. HIGHLIGHTS 1Q2003 • Net Income of R$ 287 million in the 1st quarter (+129%). • Net Sales of R$ 3.3 billion in the 1st quarter (+101%). • Output recorded 1 million metric tons of crude steel in March. • Dividends paid in a quarterly basis. • Stock Bonus of 100% to Metalúrgica Gerdau S.A. shareholders and 30% to Gerdau S.A shareholders. • Shares reduced by 1,000:1 reverse split and shares traded as single units. • Stock option plan to the management and employees. • Gerdau is the 19th largest crude steel producer in the world as published by Metal Bulletin. • Metalúrgica Gerdau S.A. will be listed in the Level I of Bovespa Corporate Governance Index. 19

  20. RESULTS 1Q2003 20

  21. 706 3,327 39 598 120 47 2,566 412 1,490 1,659 620 1,717 1Q02 4Q02 1Q03 1Q02 4Q02 4Q03 36% 43% 32% 34% 4% 3% 1Q02 2Q02 3Q02 4Q02 1Q03 1Q02 2Q02 3Q02 4Q02 1Q03 Brazil North America South America RESULTS COMPARISON Net Sales Ebitda R$ million R$ million Gross Margin Ebitda Margin 21

  22. 2,887 2,733 107 106 2,121 1,269 84 1,067 625 580 536 657 980 854 876 1Q02 4Q02 1Q03 Brazil – Domestic Market North America Brazil – Exports South America SHIPMENTS In thousand metric tons Good market condition in Chile. Merger with Co-Steel and recovery of demand after the harsh seasonal weather. Açominas operating in full capacity. Better international prices and stronger exports could balance the lower domestic market demand. Exports13.3% Domestic Market 12.9% 22

  23. SALES BY PRODUCT LINE • Gerdau has 49% of the market share in the Brazilian long steel market. • The strong participation of common long steel products abroad is due to the merger with Co-Steel. COMMON LONG STEEL PRODUCTS 1st QUARTER 2003 Common long steelproducts Abroad 43% Common long steelproducts Brazil 22% Domestic Market 72% Exports 28% Semi-finished 19% SEMI-FINISHED PRODUCTS Specialty steel 3% Drawn products 6% Exports 86% Flat steel 8% Domestic Market 14% SALES BY SEGMENTS 45% Civil Construction, 53% Industry and 2% Agricultural (Gerdau S.A. non consolidated) 23

  24. Brazil South America North America OUTPUT In thousand metric tons CRUDE STEEL OUTPUT ROLLED PRODUCTS OUTPUT 2,955 2,185 2,922 2,135 105 2,227 97 85 91 1,481 69 1,134 1,195 71 1,084 1,122 662 612 1,691 1,675 1,496 996 922 798 1Q02 1Q02 4Q02 1Q03 4Q02 1Q03 24

  25. INDEBTEDNESSMarch 2003 In R$ million • The increase in the ST portion is due to the reclassification of North American debt - LT x ST(refinancing process under development) • Cash & equivalents reduction due to the dividend payment made in the 1st quarter of 2003 (R$ 186 million). 25

  26. SHORT TERM – R$ 4.6 billion Working capital (in US$) - R$ 290 million Import loans – R$ 362 million Pre-export /ACC – R$ 341 million BNDES – R$ 110 million Açominas (in R$) – R$ 114 million Companies abroad R$ 2,234 million Açominas (in US$) - R$ 834 million Other - R$ 285 million LONG TERM – R$ 2.7 billion Working capital (in US$) - R$ 179 million Import loans – R$ 28 million BNDES – R$ 278 million Pre-export /ACC – R$ 124 million Companies abroad R$ 547 million Açominas (in R$) – R$ 186 million Açominas (in US$) - R$ 114 million Other - R$ 165 million Eurobonds – R$ 317 million Debentures Abroad– R$ 209 million Debentures - Brazil– R$ 543 million DEBT BREAKDOWNMarch 2003 26

  27. FINANCIAL RATIOS * EBITDA last 12 months. 27

  28. INVESTMENTS 1ST QUARTER 2003 US$ 78 MM 2003 FORECAST US$ 230 MM Gerdau US$ 17 mm South America US$ 2 mm Stronger investments in the 1Q 2003 due to the new wire rod rolling mill facility. North America US$ 22 mm Açominas US$ 37 mm HIGHLIGHTS • Conclusion of the new wire rod rolling mill in Açominas. • Enlargement of electric furnace of Piratini and an increase of 15% in the melt shop capacity. • Implantation of a new continuous casting in Usiba mill (conclusion in 2004). • Improvements and technological update of the facilities in North America. • The São Paulo Greenfield project will be analyzed in the 2nd half of 2003. 28

  29. STEEL SECTORWorld Brazil GERDAU S.A. CONSOLIDATED Highlights Consolidated Figures Outlook Capital Markets

  30. FORECASTS BRAZIL • Increase of 2.0% in GDP • Increase of exports • Decrease of the Brazilian risk • Better risk perception by foreign investors • Record year of Agricultural output • Impact of the Asian economy slowdown NORTH AMERICA • End of the war and slow economic recovery • End of winter time and increase in demand • Price increases will enhance 2Q2003 results • Main inputs cost decreasing SOUTH AMERICA • Good condition of the Chilean economy • Slow recovery of Argentinean economy 30

  31. STEEL SECTORWorld Brazil GERDAU S.A. CONSOLIDATED Highlights Consolidated Figures Outlook Capital Markets

  32. Gerdau ControllingGroup 25% Brazilian Inst. Investors23% Other investors 33% Foreign Inst. Investors19% Foreign Inst. Investors19% Brazilian Inst. Investors 13% Gerdau Companies 52% SHAREHOLDERS STRUCTURE March 2003 METALÚRGICA GERDAU S.A. GERDAU S.A. Other investors 16% 32

  33. STOCK BONUS & REVERSE SPLIT METALÚRGICA GERDAU S.A. GERDAU S.A. Events schedule • 05.02.2003: shares traded with all adjustments (ex-rights) • 05.15.2003: dividend payment based on positions held on 03.31.2003 • 06.10.2003: deadline to shareholders compose their odd lots • 06.23.2003: Bovespa’s auction to sell the odd lots • 06.30.2003: credit in the shareholders’ bank accounts of the odd lot amounts 33

  34. METALÚRGICA GERDAU S.A. GERDAU S.A. R$ million 763 R$ million 266 461 412 382 164 140 234 306 125 123 98 181 174 59 163 57 106 54 34 1998 1998 1999 2000 2001 2002 1999 2000 2001* 2002 Pay out 32.0% 33.1% 32.6% 52.5% 33.9% 32.8% 32.0% 32.8% 35.6% 34.9% Yield 16.4 % 6.0 % 7.9 % 17.0 % 12.4 % 11.7 % 3.6 % 6.1 % 6.8 % 7.1% Adjusted Net Income Dividend paid DIVIDEND POLICY • Distribute, at least, 30% of the Adjusted Net Income. • Since March 2003, the dividend payment started to be made on a quarterly basis. * Higher amount due to the supplementary dividend payment. 34

  35. +68% Nyse +52% Nyse +440% Nyse +68% Bovespa -33% Bovespa +70% Bovespa 4% Nyse -3% Bovespa Bovespa NYSE LIQUIDITY OF SHARES Gerdau S.A. US$ million Traded Volume 700 143 138 500 54 82 300 423 459 10 474 282 250 100 1999 2000 2001 2002 LTM* *Date: 04.30.2003 Source: Economática 35

  36. Base 100 250 200 150 100 60 2001 2002 Metalúrgica Gerdau S.A Gerdau S.A Ibovespa QUOTES EVOLUTION Period: 01.01.2001 a 04.30.2003 Source: Economática 36

  37. 5 years 1 year 3 years GOAU4 +98% GGBR4 +84% GOAU4 +53% GOAU4 +37% GGBR4 +29% GGBR4 +2% Dow-6% Dow-15% Ibov-22% Dow-21% Ibov-49% Ibov-57% Met. Gerdau – GOAU4 Ibovespa Gerdau - GGBR4 Dow Jones APPRECIATION CHART PROFITABILITY IN US$ Source: Economática Date: 04.30.2003 37

  38. www.gerdau.com.br inform@gerdau.com.br

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