May, 2005

All data presented in R$ and in metric tons, except when indicated

NYSEGlobal Opportunities Conference

STEEL SECTOR

GERDAU S.A. CONSOLIDATED

CAPITAL MARKETS

Source: IISI / World Steel Dynamics

WORLD STEEL OVERVIEW

Production in 2004: 1.1 billion tons of

crude steel

Production in 2004: 1.1 billion tons of

crude steelChina

26%

Other 41%

Japan 11%

USA 9%

Russia 6%South Korea 4%

World Production & Demand EvolutionFinished Steel

1985 1990 1995 2000 2005F 2010F

632

1,0001,153

Production Apparent Consumption

Production by Countries

690 698830 1,117

942

772641655603

+ 82%

+ 85%

Brazil 3%

3

In million tons

According to the WSD forecast for 2010, 97% of the world production

will be consumed.

INTERNATIONAL STEEL TRADE

TOP 5Net Exporters

TOP 5Net Importers

31.9 Japan

25.5 Russia

25.2 Ukraine

10.9 Brazil

9.4 Belgium

USA 24.6

China 22.6

Thailand 8.2

Hong Kong 5.4

Italy 5.2

GDP Growth Rate 2004(Annual percent change)

2.6 %

7.1 %

12.1 %

5.2 %

2.7 %

1.2 %

8.1 %

6.1 %

9.5 %

4.4 %

Source: IISI / IMF

In million tons

4

WORLD STEEL RANKINGCrude Steel – Output 2004

Arcelor (LUX) 1

LNM Holdings (NED) 2

Nippon Steel (JAP) 3

JFE Steel (JAP) 4

Posco (KOR) 5

Shangai Baosteel (CHI) 6

US Steel (USA) 7

Corus Group (U.K.) 8

ThyssenKrupp (GER) 10

Riva Group (ITA) 11

ISG (USA) 12

Nucor (USA) 9

Gerdau Group (BRA) 13

Severstal (RUS) 14

46.9

42.8

31.4

31.1

31.1

21.4

20.8

19.9

17.9

17.6

16.7

16.1

13.4

12.8

In million tons

Mittal Steel (Ispat, LNM and ISG)

is currently the biggest world steel company with 60 million tons of

installed capacity.

Gerdau will have an installed capacity of 21 million tons of crude steel per year after the investment program in Brazil

is completed in 2007.

Source: Metal Bulletin 5

BRAZILIAN STEEL SECTOR

Per Capita Apparent Consumption – Finished Steel(Kg/inhab.)

234

Source: IISI / IBS

Usiminas System(Usiminas + Cosipa)

27%

Arcelor(Acesita+ Belgo+ CST)

28%

GerdauAçominas22%

CSN 17%

Other6%

Market Share 2004Crude Steel Long Rolled Steel

GerdauAçominas48%

Belgo35%

Barra Mansa5%

Other12%

203 181 148 10432 31

165

278390

434

602

985

Sout

h

Korea Ja

pan

Germ

any

USA

Fran

ce

Russia

Chin

a

Mid

dle

East

Mex

ico

Brazil

Africa

Indi

a

WORLD

Finished steel per capita apparent consumption is still low compared to the

developed countries. 489 kg/inhab.

Average per capita apparent consumption of developed countries in

2003

6

STEEL SECTOR

GERDAU S.A. CONSOLIDATED

CAPITAL MARKETS

COMPETITIVE EDGE

Focused on long steel products manufacturing and distribution

Market mill approach

Up-to-date technology

Competitive production costs

Diversified production processes

Multiple raw materials sourcing

Service and distribution centers

Relevant market share in every country in which the Company has operations

Financial soundness and access to international capital markets

Confirmed experience in turning around distressed operations

8

GEOGRAPHICAL LOCATION

North AmericaSteel mills (14)Downstream operations (13)Fab shops (29)Scrap collection and processing units (16)

Joint Venture (1)

Steel mills (10)Downstream operations (8)Fab shops (11)

Flat steel service centers (6)

Retail stores (70)

Scrap collection and processing units (8) Solid pig iron production units (2)Iron ore extraction areas (3)Private port terminals (2)

Brazil

South AmericaSteel mills (2)

Fab shops (4) Joint Venture (1) Retail stores (6)

9

In thousand tons

INSTALLED CAPACITY December 2004

Crude Steel

Rolled Steel Products

Slab, Blooms& Billets

5108,2907,580

7,6304,730

2,610

BrazilBillets, slabs, blooms,

merchant bars, rebars, wire rod, drawn products, welded

wire meshes, structural, nails, downstream products,

fabricated steel products and specialty steel.

North America

South America

Brazil

610

16,380

12,970

2,610

North AmericaBillets, merchant bars, rebars,

wire rod, drawn products, welded meshes, nails, downstream products,

fabricated steel products, flat steel products and grinding

balls.

South AmericaBillets, merchant bars, rebars

and wire rod.

Main Products

10

SHIPMENTS

Brazil - Domestic market

Brazil - Exports

South America

North America

1Q04 2Q04 3Q04 4Q04 1Q05

3,148 3,134 3,171 3,1073,355

915

723

121

1,389

1,049

632

119

1,334

1,109

572

137

1,353

808

821

144

1,334

866

722

136

1,631

In thousand tons

111Q04 2Q04 3Q04 4Q04 1Q05

Net Sales per Ton(R$/ton shipped)

1,000

1,200

1,400

1,600

1,800

2,000

2,200

1,212

1,302

1,4621,678

1,769

2,078

South America

North America

Brazil

BrazilNorth

America

Depreciation 7% 2%Energy sources and Reduction agents 20% 10%Maintenance 8% 8%Metalic Inputs 40% 58%Labor 13% 7%Others 12% 15%Total 100% 100%

PRODUCTION COSTS

Cost of Sales per Ton(R$ per ton shipped)

Cost of Sales per Ton(R$ per ton shipped)

1Q041Q04 2Q042Q04 3Q043Q04 4Q044Q04 1Q051Q05

1,3261,326

1,6901,690 1,6501,650 1,5751,5751,7391,739

Net Sales per tonNet Sales per ton Cost per tonCost per ton

1,2

58

1,2

58

1,0

98

1,0

98

1,0

58

1,0

58

1,0

95

1,0

95

1,0

02

1,0

02

Breakdown of Costs – 1Q05

12

1Q04

GROSS SALES REVENUE 6,929 4,973 23,408

Net Sales Revenue 5,832 4,173 19,597

Gross Profit 1,612 1,017 6,245

SG&A (410) (305) (1,459)

Net Financial Expenses (123) (154) (176)

Other Operating Results 68 18 188

Equity Pick-up 23 17 (343)

Operating Profit 1,169 593 4,455

Non-Operating Result 0 (10) (25)

Provision for Income Tax and Social Contribution

(351) (148) (1,154)

Other (7) (8) (41)

Net Profit 811 427 3,235

FINANCIALS

1Q05 2004

In R$ millions

Consolidation of the new

North American units

(North Star Steel)

Increase of 31% in the

average prices

(net sales/ton)

Improvement in the

operating efficiency and

gains in productivity

1Q05 Main Events

13

INDEBTEDNESS

Mar.05 2003In R$ millions

COST OF DEBT (per annum)

Brazil - Domestic currency 15.78%

Brazil – Foreign currency FX+5.61%

Companies abroad 7.05%

HEDGE

In R$ millions

Foreign currency debt (Brazil) 2,321

Swap operations 162

Exports 3,000

Cash in US$ 1,597

TOTAL HEDGE 4,759

COVERAGE RATIO 2.0 x

DEBT AVERAGE LIFE 4.1 years

29

Dec.04

14

GROSS DEBT 6,398 100% 6,377

SHORT TERM 1,612 25% 1,972 Domestic currency 206 3% 202 Foreign currency 641 10% 705 Companies abroad 765 12% 1,065

LONG TERM 4,786 75% 4,405 Domestic currency 1,406 22% 1,211 Foreign currency 1,680 26% 1,653 Companies abroad 1,701 27% 1,541

CASH & CASH EQUIV. 2,326 100% 2,042 Domestic currency 730 31% 649 Companies abroad 1,597 69% 1,393

NET DEBT 4,071 4,335

FINANCIAL RATIOS

Consolidated Leverage Ratio(Net Debt/EBITDA*)

Interest Coverage Ratio(EBITDA / Net Interest Expense – FX and Monetary Var.)

1Q04 2Q04 3Q04 4Q04 1Q05

Net Debt Consolidated Leverage Ratio

In R$ millions

1Q04 2Q04 3Q04 4Q04 1Q05

EBITDA Interest Coverage Ratio

In R$ millions

5.6

8.4

14.3

19.8

883

1,715 1,665

1,289

1.8

1.3

0.8 0.8

5,2284,957

3,8474,335

22.8

1,415

0.7

4,071

15*Last 12 months

INVESTMENTS

2004 2007

8,800

7,580

9,230

11,720

16,380

20,950

+ 55%

+ 5%

+ 28%

Installed Capacity Evolution

2005: US$ 1,140 mm

2006: US$ 1,260 mm

2007: US$ 770 mm

Total: US$ 3,170 mm

Brazil

Expansion: US$ 1,620 mmTech. Update: US$ 750 mm

Abroad

Tech. Update: US$ 800 mm

Investment Schedule

2004 2007

8,240

4,730

8,880

6,610

12,97015,490

+ 40%

+ 8%

+ 19%

Brazil Abroad Brazil Abroad

Crude Steel Rolled Products

16

Expansions OURO BRANCO (Minas Gerais) – US$ 830 mm

Capacity increase: 1.5 million tons of crude steel (2007 year-end)

COSIGUA (Rio de Janeiro) – US$ 174 mmCapacity increase: 400 thousand tons of crude steel (2007 year-end)

150 thousand tons of rolled products (2005 year-end)

150 thousand tons of rolled products (2007 year-end)

USIBA (Bahia) – US$ 88 mmCapacity increase: 320 thousand tons of crude steel (2007 year-end)

370 thousand tons of rolled products (2007 year-end)

AÇOS FINOS PIRATINI (Rio Grande do Sul) – US$ 43 mmCapacity increase: 150 thousand tons of rolled products (March 2005)

OTHER MILLS IN BRAZIL – US$ 87 mmCapacity increase: 220 thousand tons of crude steel (2007 year-end)

MAIN INVESTMENTS

Greenfield Projects ARAÇARIGUAMA (São Paulo) – US$ 105 mm Capacity: 900 thousand tons of crude steel (May 2005)

600 thousand tons of rolled products (April 2006)

GERDAU AÇOS ESPECIAIS RIO (Rio de Janeiro) – US$ 293 mm Capacity: 800 thousand tons of crude steel (2007 year-end)

500 thousand tons of rolled products (2007 year-end)

17

STEEL SECTOR

GERDAU S.A. CONSOLIDATED

CAPITAL STRUCTURE

SHAREHOLDING STRUCTURE

Met. Gerdau S.A.

Gerdau S.A.

45%

GerdauParticipações S.A.

100%

92%

Gerdau InternacionalEmpreendimentos Ltda.

Gerdau Açominas S.A.

72%

Gerdau Chile

Gerdau Laisa

SIPAR Aceros 38%

100%

100%

23%

Gerdau Ameristeel Corp.66%

19

www.gerdau.com.br

inform@gerdau.com.br

+55 51 3323 2703

Declarations relative to business perspectives are based on current

expectations on future events and trends that affect our business. These

estimates are subject to risk, uncertainties and suppositions and include,

among other, overall economic, political and commercial environment, in

Brazil and in the markets we are present in addition to government

regulations, present and future.