Professional Documents
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Disclaimer
Declarations relative to business perspectives of the Company, operating and financial results and projections, and references to the growth of the Company, constitute mere forecasts and were based on Managements expectations in relation to future performance. These expectations are highly dependent on market behavior, Brazils economic situation, the industry and international markets, and are therefore subject to change.
2006
7,945 12,415 4,268 3,560 (332) 2,515 4,368 35.2% 550 18,975 760 10,418
2005
7,348 13,041 5,415 4,760 (666) 3,918 5,525 42.4% 752 18,195 2,012 8,753
(a) Earnings before interest, tax and participations. (b) Earnings before interest, taxes, depreciation, amortization and participations.
STEEL INDUSTRY
Domestic scenario:
STEEL INDUSTRY
Weak performance in the domestic economy. Slow pace of GDP growth Appreciation of the Real against the US dollar by 8%, leading to export losses Crude steel production in 2006: 30.9 million tons, down 2% from 2005 Flat steel demand: 2006/2005: up 7%. Segments that stood out following increased consumption: automotive, industrial equipment, household appliances
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1,830 25%
1,939
1,822
26% 35% 36% 28% 27% 29% 29% 22% 30% 31% 46% 38%
Total sales in 4Q06: 1.99 MMt, 4Q06/4Q05 = up 1% 4Q06/3Q06 = up 1% Domestic sales: up 25% from 4Q05 and stable from 3Q06
62%69% 68%
75% 74% 65% 64% 72% 73% 71% 71% 78% 70% 69% 75% 74% 65% 64% 72% 73% 71% 71% 78% 70% 69% 54% 62% 69% 68% 67%
Exports: down 29% from 4Q05 and up 4% from 3Q06 Total sales in 2006: 7.95 MMt, up 8% from 2005
1Q03 2Q03 3Q03 4Q03 1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06
Domestic Market
Export Market
2005
Slabs 15%
Germany 13%
Others 13%
CONSOLIDATED EBITDA
EBITDA & EBITDA Margin
50% 49% 48% 47% 46% 42% 36% 33% 31% 39% 41% 39% 36%
EBITDA totaled R$ 1.2 billion (US$ 551 million) in 4Q06 and R$ 4.4 billion in 2006 (US$ 2.0 billion) EBITDA margin of 36% in 4Q06 and 35% in 2006
258
255
225
263
318
422
538
652
646
655
539
404
414
479
565
1Q 03 2Q 03 3Q 03 4Q 03 1Q 04 2Q 04 3Q 04 4Q 04 1Q 05 2Q 05 3Q 05 4Q 05 1Q 06 2Q 06 3Q 06 4Q 06
EBITDA Margin
551
2.7 2.6
2.5
CND/EBITDA at low levels, 0.2 x Debt profile: Short Term - 22% Long Term - 78% Debt by currency: Domestic - 27% Foreign - 73%
0.4
0.2
2.4 2.6
2.5
2.3
2.2
1.9
1.7
1.3
1.0
1.0
1.0
0.9
0.7
1Q06
0.7
1Q03
1Q04
1Q05
0.8
CND/EBITDA
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4Q06 CONSOLIDATED CASH FLOW Brazilian GAAP (Brazilian Corporation Law) - R$ million
1,186 2,000 226 325 88 77 159 3 45 2,721
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187,1
144,8 132,9
PNA and ON shares rose 45% and 87% in 2006, respectively, while the Ibovespa rose 33% PNA shares continues the fourth most traded at the So Paulo Stock Exchange
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IBOVESPA
USIM5
OUTLOOK
International market: Inventory adjustments in the US and in Europe. Rising freight costs Likely reduction in Chinese exports due to expectations for the elimination of rebates and to the reaction of several countries against the exported volume Price recovery expected to start in the first half of 2007 Offer / demand stability during the second half of 2007
Domestic market: Expectation for demand growth over 8% (IBS). Demand will be spurred by recovery in volumes of heavy plates and by performance of industrial sectors Factors that can influence demand: - reduction in interest rates and maintenance of high credit volumes; - increase in investments on important steel consuming sectors and increased demand from the main industrial sectors
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Total sales: approximately 8.0 million tons, stable compared with 2006 Domestic Market: 70% of total sales volume = 6% growth, spurred by demand increase, notably heavy plates Exports: 30% of total sales
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OTHER HIGHLIGHTS
Investment grade rating from Fitch Ratings Social Statement Award Guide of the 500 Best Companies Award, granted by the Isto Dinheiro magazine (Usiminas and Usiparts) Finalist in the 10th Transparency Award 2006 Finalist in all APIMEC Award categories
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Bruno Seno Fusaro brunofusaro@usiminas.com.br Phone: 55 31 3499-8710 Matheus Perdigo Rosa mprosa@usiminas.com.br Phone: 55 31 3499-8056
Luciana Valadares dos Santos lsantos@usiminas.com.br Phone: 55 31 3499-8619 Gilson Rodrigues Bentes gilson@cosipa.com.br Phone: 55 11 5070-8980 So Paulo 55 31 3499-8617 B. Horizonte
www.usiminas.com.br/ri_investidores
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