Gerdau Ameristeel Announces 2009 Fourth Quarter and Year End Results

TAMPA, FL, Feb. 25 /CNW/ - Gerdau Ameristeel Corporation (NYSE: GNA; TSX: GNA) today reported a net loss of $46.1 million ($0.11 per share) for the three months ended December 31, 2009, in comparison to a net loss of $25.4 million ($0.06 per share) for the three months ended September 30, 2009 and $1.3 billion ($3.08 per share) for the three months ended December 31, 2008. Included in the results for the three months ended December 31, 2009 is a pre-tax charge of $12.2 million related to the write-off of deferred financing costs and a pre-tax gain on sale of investments of $3.2 million. Excluding these adjustments, Non-GAAP Adjusted Net Loss was $40.3 million ($0.09 per share) for the three months ended December 31, 2009.

For the year ended December 31, 2009, the Company incurred a net loss of $161.7 million ($0.37 per share) compared to a net loss of $587.4 million ($1.36 per share) for the year ended December 31, 2008. Included in the current year results is a $115.0 million pre-tax charge related to actions announced earlier this year to stop production at certain of the Company's steel mills, a pre-tax charge of $12.2 million related to the writedown of deferred financing costs, a pre-tax charge of $11.9 million related to the early extinguishment of certain debt obligations and a pre-tax gain on the sale of investments of $3.2 million. Excluding these adjustments, the Non-GAAP Adjusted Net Loss was $73.3 million ($0.17 per share) for the year ended December 31, 2009. This compares to Non-GAAP Adjusted Net Income of $718.0 million ($1.67 per share fully diluted) for the year ended December 31, 2008.

Net sales for the three months ended December 31, 2009 decreased 9% to $1.0 billion from $1.1 billion for the three months ended September 30, 2009, and decreased 29% from $1.4 billion for the three months ended December 31, 2008. Weighted average mill selling price decreased 2% or $13 per ton in comparison to the three months ended September 30, 2009 and decreased 33% or $296 per ton in comparison to the three months ended December 31, 2008. Finished steel shipments were 1.3 million tons, a decrease of 14% or 210,000 tons from the three months ended September 30, 2009 and a decrease of 4% or 55,000 tons from the three months ended December 31, 2008.

Net sales for the year ended December 31, 2009 were $4.2 billion compared to net sales of $8.5 billion for the year ended December 31, 2008. Weighted average mill selling price for the year ended December 31, 2009 decreased 28% or $247 per ton compared to the same period in 2008 while finished steel shipments decreased 36% to 5.3 million tons for the year ended December 31, 2009 compared to 8.3 million tons for the same period in 2008.

EBITDA was $43.8 million for the three months ended December 31, 2009, compared to EBITDA of $163.0 million for the three months ended September 30, 2009 and $19.4 million for the three months ended December 31, 2008. For the year ended December 31, 2009, EBITDA was $320.3 million compared to EBITDA of $1.5 billion for the year ended December 31, 2008.

During the three months and year ended December 31, 2009, the Company incurred a foreign exchange loss of $7.4 million and $37.9 million, respectively, as the Canadian dollar strengthened approximately 4% and 16% in comparison to the US dollar. This charge arose from the revaluation of US dollar investments held by the Company's Canadian entities.

During December 2009, the Company entered into a new $650 million senior secured asset-based revolving credit facility. The facility replaced the Company's $950 million asset-based credit facility that would have matured in October 2010. The new facility is scheduled to mature in December 2012. In addition, the Company entered into a $610 million loan agreement with Gerdau Holdings Inc., a subsidiary of Gerdau S.A. The loan bears interest at 7.95%, is payable semi-annually, has no scheduled principal payment prior to maturity, and will mature in January 2020. The net proceeds of the Gerdau Holdings, Inc. loan plus an additional $300 million of cash were used to prepay $910 million of the Term Loan Facility.

At December 31, 2009, the Company had $656.3 million of cash and short-term investments, a decrease of $32.1 million from the levels at December 31, 2008. Excluding both the cash paid by the Company to redeem its $405 million 10 3/8% Senior Notes in August 2009 and the above mentioned $300 million debt prepayment, the Company generated $680.2 million in cash and short-term investments in 2009. In addition to its cash and short-term investments, the Company had approximately $420.2 million available under secured credit facilities which resulted in a total liquidity position of approximately $1.1 billion at December 31, 2009.

CEO Comments

Mario Longhi, President and CEO of Gerdau Ameristeel, commented:

"While 2009 was certainly a challenging year for the steel industry, we took a number of actions to better position us for the future. In regard to our operations, we reduced our cost structure and implemented processes to better maximize productivity across our network of facilities and we worked very closely with our customer base during these difficult times to enhance our long-term relationships. From a financial standpoint, using our significant cash generation, we improved the strength of our balance sheet by reducing our debt by $709 million and extending maturities.

Some of the benefits of these actions were evidenced in the fourth quarter 2009 results. By focusing on what we control, when comparing the fourth quarter of 2009 to the same period of 2008, we improved EBITDA by $24 million despite facing a decline in selling prices and shipment volumes of 33% and 4%, respectively. I am proud to say that these successes were achieved as a result of the dedication of our teams delivering exceptional performance during these difficult times.

While minimal stimulus dollars were spent during 2009, we believe that more infrastructure projects will be undertaken during 2010. In addition, there are certain segments such as the nuclear power industry which we believe will begin committing significant investments to modernize the aging infrastructure in North America. We believe that these factors, along with low customer inventory levels and increases in shipments and selling prices that have occurred since the end of 2009, give us reason to enter 2010 with optimism for a better year."

IFRS Conversion

In 2008, the Canadian Accounting Standards Board confirmed that Canadian publicly accountable enterprises will be required to adopt International Financial Reporting Standards ("IFRS") for interim and annual financial statements related to fiscal years beginning on or after January 1, 2011. In accordance with the approval granted by the Canadian securities regulatory authorities, the Company expects to adopt IFRS in 2010.

Forward Looking Statements

In this press release, "Gerdau Ameristeel" and "Company" refer to Gerdau Ameristeel Corporation and its subsidiaries and 50%-owned joint ventures. Certain statements in this press release, including, without limitation, the section entitled "CEO Comments" constitute forward-looking statements. Such statements describe the Company's assumptions, beliefs and expectations with respect to its operations, future financial results, business strategies and growth and expansion plans can often be identified by the words "anticipates," "believes," "estimates," "expects," "intends," "plans," and other words and terms of similar meaning. The Company cautions readers that forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those currently projected by the Company. In addition to those noted in the statements themselves, any number of factors could affect actual results, including, without limitation:

Excess global steel industry capacity and the availability of competitive substitute materials; the cyclical nature of the steel industry and the industries served by the Company and economic conditions in North America and worldwide; increases in the cost of steel scrap, energy and other raw materials; steel imports and trade regulations; a change in China's steelmaking capacity or slowdown in China's steel consumption; the Company's participation in the consolidation of the steel industry; the substantial capital investment and similar expenditures required in the Company's business; unexpected equipment failures and plant interruptions or outages; the Company's level of indebtedness; the cost of compliance with environmental and occupational health and safety laws; the enactment of laws intended to reduce greenhouse gases and other air emissions; the Company's ability to fund its pension plans; the ability to renegotiate collective bargaining agreements and avoid labor disruptions; currency exchange rate fluctuations; actions or potential actions taken by the Company's principal stockholder, Gerdau S.A., the liquidity of the Company's long-term investments, including investments in auction rate securities, and the Company's reliance on its 50%-owned joint ventures that it does not control.

Any forward-looking statements in this press release are based on current information as of the date of this press release and the Company does not undertake any obligation to update any forward-looking statements to reflect new information, future developments or events, except as required by law.

Notice of Conference Call

Gerdau Ameristeel invites you to listen to a live broadcast of its fourth quarter conference call on Thursday, February 25, 2010, at 2:30 pm EST. The call will be hosted by Mario Longhi, President and CEO, and Barbara Smith, VP and CFO, and can be accessed via our Web site at www.gerdauameristeel.com. Web cast attendees are welcome to listen to the conference in real-time or on-demand at your convenience.

About Gerdau Ameristeel

Gerdau Ameristeel is the second largest mini-mill steel producer in North America, with annual manufacturing capacity of approximately 12 million tons of mill finished steel products. Through its vertically integrated network of mini-mills, scrap recycling facilities and downstream operations, Gerdau Ameristeel serves customers throughout the United States and Canada. The Company's products are generally sold to steel service centers, steel fabricators, or directly to original equipment manufacturers ("OEMs") for use in a variety of industries, including non-residential, infrastructure, commercial, industrial and residential construction, metal building, manufacturing, automotive, mining, cellular and electrical transmission and equipment manufacturing. Gerdau Ameristeel's majority shareholder is the Gerdau Group, a 100+ year old steel company, the leading company in the production of long steel in the Americas and one of the major specialty long steel suppliers in the world. Gerdau Ameristeel's common shares are traded on the New York Stock Exchange and the Toronto Stock Exchange under the ticker symbol GNA.

    
    GERDAU AMERISTEEL CORPORATION AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF EARNINGS
    (US$ in thousands, except earnings per share data)
    (Unaudited)

                             Three Months Ended            Year Ended
                          December 31, December 31, December 31, December 31,
                              2009         2008         2009         2008
                          ------------ ------------ ------------ ------------

    NET SALES             $   975,926  $ 1,436,596  $ 4,195,723  $ 8,528,480

    OPERATING EXPENSES
      Cost of sales
       (exclusive of
       depreciation and
       amortization)          885,927    1,340,029    3,656,083    6,799,427
      Selling and
       administrative          55,134       65,840      227,683      253,222
      Depreciation             56,456       60,090      214,106      219,667
      Amortization of
       intangibles             16,162       26,283       65,736      102,959
      Impairment of goodwill        -    1,278,000            -    1,278,000
      Facility closure costs        -            -      115,033            -
      Other operating
       expense, net             1,049       11,347        3,520        8,293
                          ------------ ------------ ------------ ------------
                            1,014,728    2,781,589    4,282,161    8,661,568

    LOSS FROM OPERATIONS      (38,802)  (1,344,993)     (86,438)    (133,088)

    (LOSS) INCOME FROM 50%
     OWNED JOINT VENTURES       7,156      (39,162)      (4,692)      45,005
                          ------------ ------------ ------------ ------------

    LOSS BEFORE OTHER
     EXPENSES AND INCOME
     TAXES                    (31,646)  (1,384,155)     (91,130)     (88,083)

    OTHER EXPENSES
      Interest expense -
       non-affilliated         26,425       40,180      132,166      165,607
      Interest expense -
       affilliated              3,772            -        3,772            -
      Interest income            (730)      (2,764)      (5,040)     (14,921)
      Amortization of
       deferred financing
       costs                   15,083        2,790       24,274       10,951
      Loss on extinguishment
       of debt                      -            -       11,877            -
      Foreign exchange (gain)
       loss, net                7,371      (13,226)      37,914      (21,682)
      Realized (gain) loss on
       investments, net        (3,244)      13,276       (3,244)      59,977
                          ------------ ------------ ------------ ------------
                               48,677       40,256      201,719      199,932

    LOSS BEFORE INCOME TAXES  (80,323)  (1,424,411)    (292,849)    (288,015)

    INCOME TAX (BENEFIT)
     EXPENSE                  (32,729)     (97,320)    (128,576)     287,440
                          ------------ ------------ ------------ ------------

    NET LOSS                  (47,594)  (1,327,091)    (164,273)    (575,455)

      Less: Net Income (Loss)
       attributable to
       noncontrolling
       interest           $    (1,496) $     2,329  $    (2,557) $    11,952
                          ------------ ------------ ------------ ------------

    NET LOSS ATTRIBUTABLE
     TO GERDAU AMERISTEEL
     & SUBSIDIARIES       $   (46,098) $(1,329,420) $  (161,716) $  (587,407)
                          ------------ ------------ ------------ ------------
                          ------------ ------------ ------------ ------------

    LOSS PER COMMON SHARE
     - BASIC              $     (0.11) $     (3.08) $     (0.37) $     (1.36)
    LOSS PER COMMON SHARE
     - DILUTED            $     (0.11) $     (3.08) $     (0.37) $     (1.36)



    GERDAU AMERISTEEL CORPORATION AND SUBSIDIARIES
    CONSOLIDATED BALANCE SHEETS
    (US$ in thousands, except earnings per share data)


                                                    December 31, December 31,
                                                        2009         2008
                                                    ------------ ------------
    ASSETS

    Current Assets
      Cash and cash equivalents                     $   631,293  $   482,535
      Restricted cash                                     1,691            -
      Short-term investments                             25,000      205,817
      Accounts receivable, net                          460,066      677,569
      Inventories                                       814,788    1,267,768
      Deferred tax assets                                20,742       31,414
      Costs and estimated earnings in excess of
       billings on uncompleted contracts                  4,687       14,771
      Income taxes receivable                            93,652       28,455
      Other current assets                               22,643       22,936
                                                    ------------ ------------
        Total Current Assets                          2,074,562    2,731,265

    Investments in 50% Owned Joint Ventures             148,609      161,901
    Long-term Investments                                28,538       33,189
    Property, Plant and Equipment, net                1,620,852    1,808,478
    Goodwill                                          1,962,098    1,952,011
    Intangibles                                         450,003      515,736
    Deferred Financing Costs                             29,084       35,170
    Deferred Tax Assets                                  29,760            -
    Other Assets                                         23,459       32,305
                                                    ------------ ------------

    TOTAL ASSETS                                    $ 6,366,965  $ 7,270,055
                                                    ------------ ------------
                                                    ------------ ------------

    LIABILITIES AND SHAREHOLDERS' EQUITY

    Current Liabilities
      Accounts payable and accrued liabilities      $   212,900  $   182,697
      Accrued salaries, wages and employee benefits      93,846      148,244
      Accrued interest - non-affiliated                  15,344       54,480
      Accrued interest - affiliated                       3,772            -
      Income taxes payable                                  322        2,983
      Accrued sales, use and property taxes              11,889       13,902
      Current portion of long-term environmental reserve  4,906        7,599
      Billings in excess of costs and estimated
       earnings on uncompleted contracts                 26,212       45,687
      Other current liabilities                          12,959       20,932
      Current portion of long-term debt                   3,174        1,893
                                                    ------------ ------------
        Total Current Liabilities                       385,324      478,417

    Long-term Debt, Less Current
     Portion - Non-affiliated                         1,747,601    3,067,994
    Long-term Debt - Affiliated                         610,000            -
    Accrued Benefit Obligations                         348,684      339,055
    Deferred Tax Liabilities                            300,253      323,854
    Long-term Environmental Reserve, Less Current
     Portion                                             14,415       11,151
    Other Liabilities                                    89,753      116,092
                                                    ------------ ------------

    TOTAL LIABILITIES                                 3,496,030    4,336,563
                                                    ------------ ------------
    Contingencies, Commitments and Guarantees

    Shareholders' Equity
      Capital stock                                   2,554,110    2,552,323
      Retained earnings                                 352,825      523,187
      Accumulated other comprehensive loss              (65,898)    (178,636)
                                                    ------------ ------------

        Total Gerdau Ameristeel & Subsidiaries
         Shareholders' equity                         2,841,037    2,896,874

      Noncontrolling interest                            29,898       36,618
                                                    ------------ ------------

     TOTAL SHAREHOLDERS' EQUITY                       2,870,935    2,933,492
                                                    ------------ ------------

     TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY     $ 6,366,965  $ 7,270,055
                                                    ------------ ------------
                                                    ------------ ------------



    GERDAU AMERISTEEL CORPORATION AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF CASH FLOWS
    (US$ in thousands, except earnings per share data)
    (Unaudited)


                              Three Months Ended            Year Ended
                                 December 31,              December 31,
                          ------------------------- -------------------------
                              2009         2008         2009         2008
                          ------------ ------------ ------------ ------------

    OPERATING ACTIVITIES
    Net (loss)            $   (47,594) $(1,327,091) $  (164,273) $  (575,455)
    Adjustment to reconcile
     net loss to net cash
     provided by operating
     activities:
      Depreciation             56,456       60,090      214,106      219,667
      Impairment of goodwill        -    1,278,000            -    1,278,000
      Amortization of
       intangibles             16,162       26,283       65,736      102,959
      Amortization of
       deferred financing
       costs                   15,083        2,790       24,274       10,951
      Deferred income taxes   (34,985)     (16,486)     (42,123)     (35,559)
      Loss on disposition
       of property, plant
       and equipment              547        3,284        2,322        3,322
      (Income) loss from
       50% owned joint
       ventures                (7,156)      39,162        4,692      (45,005)
      Distributions from
       50% owned joint
       ventures                10,000            -       11,828       41,829
      Compensation cost
       (benefit) from
       share-based awards       2,182       (3,513)       6,474        2,464
      Excess tax benefits
       from share-based
       payment arrangements        (6)         (29)        (135)      (1,200)
      Realized (gain) loss
       on investments, net     (3,244)      13,276       (3,244)      59,977
      Facility closure costs        -        6,702      115,033        7,807
      Loss on extinguishment
       of debt                      -            -       11,877            -
      Writedown of inventory        -       45,179       33,044       48,116

    Changes in operating
     assets and liabilities,
     net of acquisitions:
      Accounts receivable      93,258      421,239      227,323      101,941
      Inventories              83,075      376,113      433,702     (147,544)
      Other assets            (54,331)      13,708      (46,646)      11,020
      Liabilities               9,561     (441,659)    (139,970)    (315,298)
                          ------------ ------------ ------------ ------------
    NET CASH PROVIDED BY
     OPERATING ACTIVITIES     139,008      497,048      754,020      767,992

    INVESTING ACTIVITIES
      Purchases of property,
       plant and equipment     (7,092)     (55,068)     (78,086)    (168,117)
      Proceeds from
       disposition of property,
       plant and equipment        277        1,381        1,804        3,261
      Acquisitions                  -      (69,903)           -     (287,560)
      Opening cash from
       acquisitions                 -        2,249            -        2,249
      Change in restricted
       cash                       879            -       (1,691)           -
      Purchases of
       investments            (14,994)    (207,516)    (632,183)    (207,516)
      Proceeds from sales of
       investments            135,946          725      831,096        1,425
                          ------------ ------------ ------------ ------------
    NET CASH PROVIDED BY
     (USED IN) INVESTING
     ACTIVITIES               115,016     (328,132)     120,940     (656,258)

    FINANCING ACTIVITIES
      Proceeds from issuance
       of debt - non-
       affiliated                   -          577            -        1,076
      Proceeds from issuance
       of debt - affiliated   610,000            -      610,000            -
      Repayments of
       non-affiliated debt   (910,027)        (106)  (1,327,499)      (4,394)
      Payments of deferred
       financing costs         (8,656)          51      (21,887)      (1,635)
      Cash dividends                -       (8,646)      (8,646)    (142,602)
      Distributions to
       subsidiary's
       noncontrolling
       interest                     -            -       (4,163)      (3,065)
      Proceeds from
       exercise of employee
       stock options                4           51          216        1,195
      Excess tax benefits
       from share-based
       payment arrangements         6           29          135        1,200
                          ------------ ------------ ------------ ------------
    NET CASH USED IN
     FINANCING ACTIVITIES    (308,673)      (8,044)    (751,844)    (148,225)

    Effect of exchange rate
     changes on cash and
     cash equivalents           1,385      (21,538)      25,642      (28,336)
                          ------------ ------------ ------------ ------------

    INCREASE (DECREASE) IN
     CASH AND CASH
     EQUIVALENTS              (53,264)     139,334      148,758      (64,827)

    CASH AND CASH
     EQUIVALENTS AT
     BEGINNING OF PERIOD      684,557      343,201      482,535      547,362
                          ------------ ------------ ------------ ------------

    CASH AND CASH
     EQUIVALENTS AT END OF
     PERIOD               $   631,293  $   482,535  $   631,293  $   482,535
                          ------------ ------------ ------------ ------------
                          ------------ ------------ ------------ ------------

    SUPPLEMENTAL INFORMATION

      Cash (refunds)
       payments for income
       taxes              $      (918) $     6,763  $   (20,895) $   338,659
                          ------------ ------------ ------------ ------------
                          ------------ ------------ ------------ ------------
      Cash payments for
       interest           $     7,634  $     2,160  $   164,558  $   155,567
                          ------------ ------------ ------------ ------------
                          ------------ ------------ ------------ ------------
    

Non-GAAP Financial Measures

Non-GAAP Adjusted Net Loss and loss per share, which excludes the impact of the impairment of goodwill, facility closure costs, the loss on extinguishment of debt, writedown of deferred financing costs and the writedown of investments is a non-GAAP financial measure. Management believes that it is useful as a supplemental measure in assessing the operating performance of the business. The measure is used by the Company to evaluate business results. The Company excludes the impairment of goodwill, facility closure costs, the loss on extinguishment of debt, writedown of deferred financing costs and the writedown of investments because it believes they are not representative of the ongoing results of operations of the Company's business. Below is a reconciliation of this Non-GAAP measure to net loss for the periods indicated, excluding the impairment of goodwill, facility closure costs, the loss on extinguishment of debt, writedown of deferred financing costs and writedown of investments.

    
                            For the Three Months      For the Three Months
                              Ended - Unaudited         Ended - Unaudited

                          December 31,              December 31,
                              2009     Diluted EPS      2008     Diluted EPS
                          ------------ ------------ ------------ ------------
    ($000s)
    Reconciliation of net
     loss to Non-GAAP
     Adjusted

      Net Loss:

        Net loss
         attributable to
         Gerdau Ameristeel
         & Subsidiaries   $   (46,098) $     (0.11) $(1,329,420) $     (3.08)

        Adjustment for
         impairment of
         goodwill                   -            -    1,278,000         2.96

        Adjustment for
         income tax on
         impairment of
         goodwill                   -            -      (32,620)       (0.08)

        Adjustment for
         writedown of
         deferred financing
         costs                 12,158         0.03            -            -

        Adjustment for income
         tax on writedown of
         deferred financing
         costs                 (4,667)       (0.01)           -            -

        Adjustment for
         realized (gain) loss
         on investments, net   (3,244)       (0.01)      13,276         0.03

        Adjustment for income
         tax on realized
         (gain) loss on
         investments, net       1,548         0.01            -            -
                          ------------ ------------ ------------ ------------

        Non-GAAP Adjusted
         Net Loss and loss
         per share        $   (40,303) $     (0.09) $   (70,764) $     (0.16)
                          ------------ ------------ ------------ ------------
                          ------------ ------------ ------------ ------------


                                 For the Year             For the Year
                              Ended - Unaudited         Ended - Unaudited

                          December 31,              December 31,
                              2009     Diluted EPS      2008     Diluted EPS
                          ------------ ------------ ------------ ------------
    ($000s)
    Reconciliation of net
     loss to Non-GAAP
     Adjusted
      Net (Loss) Income:

        Net loss
         attributable to
         Gerdau Ameristeel
         & Subsidiaries   $  (161,716) $     (0.37) $  (587,407) $     (1.36)

        Adjustment for
         impairment of
         goodwill                   -            -    1,278,000         2.96

        Adjustment for
         income tax on
         impairment of
         goodwill                   -            -      (32,620)       (0.07)

        Adjustment for
         facility closure
         costs                115,033         0.26            -            -

        Adjustment for
         income tax on
         facility closure
         costs                (36,723)       (0.09)           -            -

        Adjustment for loss
         on extinguishment
         of debt               11,877         0.03            -            -

        Adjustment for income
         tax on loss on
         extinguishment of
         debt                  (7,518)       (0.02)           -            -

        Adjustment for
         writedown of
         deferred financing
         costs                 12,158         0.03            -            -

        Adjustment for income
         tax on writedown of
         deferred financing
         costs                 (4,667)       (0.01)           -            -

        Adjustment for
         realized (gain) loss
         on investments, net   (3,244)       (0.01)      59,977         0.14

        Adjustment for income
         tax on realized
         (gain) loss on
         investments, net       1,548         0.01            -            -
                          ------------ ------------ ------------ ------------

        Non-GAAP Adjusted
         Net (Loss) Income
         and (loss)
         earnings per
         share            $   (73,252) $     (0.17) $   717,950  $      1.67
                          ------------ ------------ ------------ ------------
                          ------------ ------------ ------------ ------------
    

EBITDA (EBITDA is calculated by adding (loss) earnings before interest and other expense on debt, taxes, depreciation and amortization, investment realized gain (loss), net, minority interest, cash distributions from 50% owned joint ventures, impairment of goodwill, facility closure costs, loss on extinguishment of debt and foreign exchange gain/loss, net; and deducting interest income and earnings from 50% owned joint ventures) is a non-GAAP measure that management believes is a useful supplemental measure of cash available prior to debt service, capital expenditures and income tax. Investors are cautioned that EBITDA should not be construed as an alternative to net income determined in accordance with GAAP as an indicator of the Company's performance or to cash flows from operations as a measure of liquidity and cash flows. EBITDA does not have a standardized meaning prescribed by GAAP. The Company's method of calculating EBITDA may differ from the methods used by other companies and, accordingly, it may not be comparable to similarly titled measures used by other companies. Reconciliation of EBITDA to net income is shown below:

    
                                                      For the Three Months
                                                        Ended - Unaudited

                                                    December 31, December 31,
                                                        2009         2008
                                                    ------------ ------------
    ($000s)
      Net loss                                      $   (47,594) $(1,327,091)
      Income tax (benefit) expense                      (32,729)     (97,320)
      Interest expense - non-affiliated                  26,425       40,180
      Interest expense - affiliated                       3,772            -
      Interest income                                      (730)      (2,764)
      Depreciation                                       56,456       60,090
      Amortization of intangibles                        16,162       26,283
      Impairment of goodwill                                  -    1,278,000
      Amortization of deferred financings costs          15,083        2,790
      Loss (income) from 50% owned joint ventures        (7,156)      39,162
      Cash distribution from 50% owned joint ventures    10,000            -
      Foreign exchange (gain) loss, net                   7,371      (13,226)
      Realized (gain) loss on investments, net           (3,244)      13,276
                                                    ------------ ------------

      EBITDA                                        $    43,816  $    19,380
                                                    ------------ ------------
                                                    ------------ ------------


                                                          For the Year
                                                        Ended - Unaudited

                                                    December 31, December 31,
                                                        2009         2008
                                                    ------------ ------------
    ($000s)
      Net loss                                      $  (164,273) $  (575,455)
      Income tax (benefit) expense                     (128,576)     287,440
      Interest expense - non-affiliated                 132,166      165,607
      Interest expense - affiliated                       3,772            -
      Interest income                                    (5,040)     (14,921)
      Depreciation                                      214,106      219,667
      Amortization of intangibles                        65,736      102,959
      Impairment of goodwill                                  -    1,278,000
      Facility closure costs                            115,033            -
      Amortization of deferred financings costs          24,274       10,951
      Loss on extinguishment of debt                     11,877            -
      Loss (income) from 50% owned joint ventures         4,692      (45,005)
      Cash distribution from 50% owned joint ventures    11,828       41,829
      Foreign exchange (gain) loss, net                  37,914      (21,682)
      Realized (gain) loss on investments, net           (3,244)      59,977
                                                    ------------ ------------

      EBITDA                                        $   320,265  $ 1,509,367
                                                    ------------ ------------
                                                    ------------ ------------



    SUPPLEMENTAL OPERATING AND FINANCIAL INFORMATION - UNAUDITED

       THE INFORMATION IN THIS TABLE EXCLUDES 50% OWNED JOINT VENTURES


                                       For the Three Months Ended
                              December 31, 2009         December 31, 2008
                          ------------------------- -------------------------

                              Tons                      Tons
                          ------------              ------------
    Production
      Melt Shops            1,273,949                 1,032,715
      Rolling Mills         1,158,748                   971,335

                              Tons          %           Tons          %
                          ------------ ------------ ------------ ------------
    Finished Steel
     Shipments
      Rebar                   217,965          17%      213,371          16%
      Merchant/Special
       Sections/Structurals   752,588          58%      734,560          55%
      Rod                     102,897           8%       82,742           6%
      Fabricated Steel        215,158          17%      312,558          23%
                          ------------ ------------ ------------ ------------
        Total Shipments     1,288,608         100%    1,343,231         100%

                             $/Ton                     $/Ton
                          ------------              ------------
    Selling Prices
      Mill external
       shipments          $       605               $       901
      Fabricated steel
       shipments                  839                     1,280

    Scrap Charged                 217                       265

    Metal Spread (Selling
     price less scrap)
      Mill external shipments     388                       636
      Fabricated steel shipments  622                     1,015

    Mill manufacturing cost       328                       489




    SUPPLEMENTAL OPERATING AND FINANCIAL INFORMATION - UNAUDITED

       THE INFORMATION IN THIS TABLE EXCLUDES 50% OWNED JOINT VENTURES

                                          For the Year Ended
                              December 31, 2009         December 31, 2008
                          ------------------------- -------------------------

                              Tons                      Tons
                          ------------              ------------
    Production
      Melt Shops            5,412,087                 8,359,903
      Rolling Mills         5,109,356                 7,948,527

                              Tons          %           Tons          %
                          ------------ ------------ ------------ ------------
    Finished Steel Shipments
      Rebar                   946,373          18%    1,564,045          19%
      Merchant/Special
       Sections/Structurals 2,806,051          53%    4,710,754          57%
      Rod                     485,415           9%      620,927           7%
      Fabricated Steel      1,075,719          20%    1,424,128          17%
                          ------------ ------------ ------------ ------------
        Total Shipments     5,313,558         100%    8,319,854         100%


                             $/Ton                     $/Ton
                          ------------              ------------
    Selling Prices
      Mill external
       shipments          $       637               $       884
      Fabricated steel
       shipments                  945                     1,150

    Scrap Charged                 201                       340

    Metal Spread (Selling
     price less scrap)
      Mill external shipments     436                       544
      Fabricated steel shipments  744                       810

    Mill manufacturing cost       315                       348
    

%SEDAR: 00000593E

SOURCE GERDAU AMERISTEEL CORPORATION

For further information: For further information: Mario Longhi, President and Chief Executive Officer, Gerdau Ameristeel, (813) 207-2346, mlonghi@gerdauameristeel.com; Barbara R. Smith, Vice President and Chief Financial Officer, Gerdau Ameristeel, (813) 319-4324, basmith@gerdauameristeel.com

Organization Profile

GERDAU AMERISTEEL CORPORATION

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890