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RIO DE JANEIRO, May 6 (Reuters) - Brazil’s steelmaker Gerdau SA on Wednesday posted a 39 percent drop in first quarter net profit as sales fell amid a likely recession in Latin America’s largest economy.
Gerdau, the largest long-steel producer in the Americas, reported net income of 267 million reais ($88 million) in the first quarter, compared to profit of 440 million reais in the same quarter last year.
The company said in a securities filing that sales volumes fell in nearly all of its business divisions even as a weaker real helped it make more money from its U.S. operations and exports.
Consolidated net revenue dropped 1 percent year-on-year, to 10.45 billion reais. In Brazil only, net revenue fell 11 percent to 3.3 million reais in the same comparison.
The Brazilian economy is expected to shrink around 1 percent this year as austerity measures weigh on domestic consumption.
Gerdau’s earnings before interest, taxes, depreciation and amortization, a measure of operational efficiency known as EBITDA, fell 8.9 percent to 1.1 billion reais, in line with analysts forecasts.
$1 = 3.05 reais Reporting by Stephen Eisenhammer and Walter Brandimarte; Editing by Chizu Nomiyama