11

February 2008

Investor Presentation Investor Presentation

22

� Among the most competitive steel companies in the world

• Strong low cost structure as a result of diversified production processes and multiple raw material sourcing

� An international company

• Large export revenues from Brazil

• Operations in 13 countries

� Ranked 14th globally by steel output for year 2006 with an output of 15.6 million tonnes (source: International Iron and Steel Institute - IISI)

� Largest long steel producer in the Americas

• 2nd largest long steel producer in North America

• 51 steel units with state of the art technology (including Joint Ventures and Associated Companies)

� Relevant market share and diversified product range through downstream and service centers

� Strong balance sheet and strong cash generation

� Gerdau S.A. shares are listed on the São Paulo, New York and Madrid Stock Exchanges

Highlights

33

Industry Overview

Group Overview

Operating and Financial Highlights

Agenda

All data presented in US Dollar and in metric tons, except when indicated

44

728 725 750 750799 777 789

848 850904

970

1.0691.139

1.230

1.322

90 93 95 101 109 115 124 127 151182

222280

356423

489

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Mundo China

China Growth

1993 to 1999 = 5.5% p.a.

China

Accel

erated

Grow

th

2000 to 2

007 =

21.2%

p.a.

Crude Steel Production

Source: IISI

In million tonnes

Growth rate in the last 10 years: + 65%

� China: + 349% World

Growth

2000 t

o 2007

= 6.5

% p.a.

World Growth

1993 to 1999 = 1.4% p.a.

55

315333

94 106146

298

28 42

66102

2002 2003 2004 2005 2006 2007e

N A F T A B razil C hina India Wo rld

2006 2007e 2008e

Demand

1,1131,179

1,251

e: estimated Source: IISI

5.9%6.1%

FINISHED STEEL APPARENT DEMANDIn million tonnes

FINISHED STEEL APPARENT PER CAPITA DEMAND (kg)

The world steel demand should increase 4.2% p.a. from 2010 up to 2015.

STEEL USE PER CAPITA GROWTH (2002 – 2007)

NAFTA: +5.7%

China: +104.1%

Brazil: +12.8%

World: +54.5%

India: +50.0%

66

489

12097

7253 51 49 43 34 32 26 21

235

37%

46%

53%59%

63%67%

70%74%

76%79% 81% 82%

100%

Production Accumulated Participation

Crude Steel Production – 2007

Source: IISI

Ranking

In million tonnes

UkraineChina USAJapan Russia Germany Brazil ItalySouth Korea

Global Production: 1,322 MMt

� China: 37% of global production

� Brazil: 3% of global production

Others

9th Largest

Producer

India Turkey Taiwan

77

Industry Overview

Group Overview

Operating and Financial Highlights

Agenda

All data presented in US Dollar and in metric tons, except when indicated

88

100+ Years in Business

1900 1940´s 1950´s 1960´s 1970´s 1980´s 1990´s 2000

1901 - First Operation:Nail Factory

1948 - 1st Steel Mill Acquisition (Riograndense)

Expansion of Riograndense Mill (Construction of 2nd

steel mill)

Distribution channel arrangements (today: more

than 70 sales points)Market Share increase by:

Diversification / Verticalization

Distribution channelNew acquisition

(Pernambuco, Brazil)

Acquisition of a new steel mill (Paraná,

Brazil)Construction of a new mill (Rio de Janeiro, Brazil)Entering in the Reforestation business

Acquisition of 3 mills (Rio de Janeiro, Minas Gerais and

Bahia, Brazil)Construction of 2 mills

(Paraná and Ceará, Brazil)International expansion (Uruguay and Canada)

New Acquisitions:Piratini (Rio Grande do Sul, Brazil) –specialty steel

Second mill in Minas Gerais and rolling mill in São Paulo

(Brazil)Stake in Açominas

International expansion ( Chile, Canada, Argentina

and USA)

New Acquisitions:Downstream mills and fab shops, Chaparral and Quanex in North

AmericaEntering European and Asian marketExpansion in Latam

marketConstruction of steel mill in São Paulo (Brazil)

99

19 9 7 19 9 8 19 9 9 2 0 0 0 2 0 0 1 2 0 0 2 2 0 0 3 2 0 0 4 2 0 0 5 2 0 0 6 2 0 0 7 2 0 10 e

Installed Capacity ExpansionCorsa

(Mexico)MacSteel(USA)

Sidertul(Mexico)INCA

(Dom. Rep.)Sizuca

(Venezuela)SJK

(India)Chaparral(USA)

1980 – Laisa(Uruguay)1988 – Barão de Cocais(Brazil)1989 – Usiba (Brazil)Cambridge (Canada)1992 – Piratini (Brazil)AZA (Chile)1994 – Pains (Brazil)Manitoba (Canada)Stake in Açominas(Brazil)

Ameristeel(USA)AZA

New mill(Chile)

Additionalstake in Açominas(Brazil)

North Star(USA)

Control ofAçominas(Brazil)Co-Steel(USA)

7,696 11,076

16,372

Diaco(Colombia)

16,8574,556

19,870São Paulo(Brazil)

Sidenor (Spain)

Sheffield (USA)

Siderperú(Peru)

GSB(Spain)

Solid Track Record24,805

TOTAL INVESTED (1997 – 2007):

Brazil = US$ 4.5 billion + Debt

North America = US$ 6.1 billion + Debt

Latin America = US$ 1.3 billion + Debt

Europe = US$ 687 million + Debt

Asia = US$ 71 million + Debt

In thousand tonnes (IFRS)

Abroad – Crude Steel Installed Capacity

Brazil – Crude Steel Installed Capacity

e: estimated

In addition to the mills acquired, as related above, Gerdau acquired many fab shops in order to add value to its products and offer services and products to its clients according to their needs.

CAGR 1997-2007

: 18,5% a.a.

* MacSteel and Corsa operations haven’t been concluded yet.

29,810

1010

Spain

Dominican Republic

Steel Units

Associated Companies

Joint Ventures

BRAZIL

Capacities:

11.4 million tonnes of crude steel

6.8 million tonnes of rolled steel products

Units:

13 Steel Units

12 Fabrication Shops - Armafer

05 Downstream operations and special sections

68 Sales point (Comercial Gerdau)

04 Flat steel service centers

ABROAD

Capacities:

13.4 million tonnes of crude steel

14.2 million tonnes of rolled steel products

Units:

38 Steel Units

52 Fabrication Shops

28 Downstream operations and special sections

07 Associated Companies (Spain and DominicanRepublic)

Canada

United States

Mexico

Venezuela

Colombia

Peru

Chile

Brazil

Argentina

Uruguay

India

Location

1111

LONG STEEL PRODUCTS (Brazil)

� Maintenance of market share

� Improvement of current installed

capacity

SPECIALTY STEEL

� Active role in the steel sector

consolidation process

� Search for new opportunities

AÇOMINAS

� New 1.5 MM tonnes blast furnace

� Growth platform for slabs, blooms

and billets

� Iron Ore Reserves

Growth Opportunities

LATIN AMERICA

� Maintenance of leadership in

the long steel sector

� New markets

NORTH AMERICA

� Efficiency and productivity

gains (Gaps)

� Enhancement of leadership in

the long steel sector through

acquisitions

1212

Outlook

BRAZIL

� High demand in the domestic market in 2008, mainly from the civil construction and

infrastructure segments

� Increase in costs in view of the estimated increases in the price of the iron ore and coke.

The prices of the scrap will not present significant fluctuations

� Adjustments in the domestic prices should balance operating margins. The prices should

continue high in the foreign market

NORTH AMERICA

� Adjustment in prices to offset the increase in costs

� Increase in production costs

� Prospect of solid demand due to the renewal of the infrastructure in the region an low

level of imports

LATIN AMERICA

� Demand should continue to be strong

� Maintenance of investments in infrastructure

� Increase in costs

� Prices may also be adjusted to balance the margins

EUROPE

� Demand for specialty steels should continue to be strong

� Recovery of margins in view of the industrial reorganization

� Increase in costs, mainly electric energy costs

1313

Industry Overview

Group Overview

Operating and Financial Highlights

Agenda

All data presented in US Dollar and in metric tons, except when indicated

1414

1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 4Q07

Shipments

Billets, blooms& slabs

Merchant bars

Rebars Fabricated steel

Heavystructural shapes

Wire-rod Wires Nails

Brazil – Domestic Market (28% in 4Q07)

In thousand tonnes (IFRS)

Brazil – Exports (13% in 4Q07)

Latin America (13% in 4Q07)

North America (41% in 4Q07)

Europe (5% in 4Q07)

2007 = 17,159

+15.2

%2006 = 14,890

3,689 3,770 3,7273,703

4,157 4,160 4,204

4,637

1515

32% 30% 34% 38%

11% 10% 8%7% 8%

38% 39% 35% 35% 38%

10% 9% 11% 11% 11%

9% 12% 12% 9% 8%

36%

4Q06 1Q07 2Q07 3Q07 4Q07

Europe

Latin America

North America

Brazil - Exports

Brazil - Domestic Market

Net Sales Breakdown

Net sales from the overseas units plus exports from Brazil, represented 66% of consolidated net sales

Net Sales Breakdown by Region - 2007

Historical Net Sales Geographical Distribution

In US$ millions (IFRS)

Brazil -Domestic Market 34%

North America37%

Europe10%

Latin America11%

Brazil – Exports 8%

Exports from Brazil (t)

Africa 12% Central America

15%

South America 24%

North America13%

Europe 10%

Asia 26%

3,030 3,577 3,915 4,168

13% in tonnes

4,558

1616

357 344 386 457 506151

254 243219

302

8160

111 84

63

5184

89 63

40

4Q06 1Q07 2Q07 3Q07 4Q07

GROSS MARGIN* EBITDA MARGIN*

EBITDA and MarginsEBITDA*In US$ millions

* Data in IFRS

North America

Brazil

Latin AmericaEurope614

742829 823

Consolidated Brazil North America Latin America Europe

8%

10%

26%

56%

33.2%

23.6%

33.3%

17.2%14.9% 13.9%

19.2%

23.8%

17.3%

21.4%

10%

15%

20%

25%

30%

35%

40%

45%

4Q06 1Q07 2Q07 3Q07 4Q07

20.0%

26.4%

20.3%

26.3%

12.5%

17.3%

25.2%

12.5%

18.3%

10.5%10%

15%

20%

25%

30%

35%

4Q06 1Q07 2Q07 3Q07 4Q07

912

1717

4Q07 4Q06 2007 2006

BALANCE SHEETCurrent Assets 8,645 7,055 8,645 7,055

Non-current Assets 14,771 7,754 14,771 7,754

Total Assets 23,416 14,809 23,416 14,809

Current Liabilities 3,719 2,896 3,719 2,896

Non-current Liabilities 10,302 4,990 10,302 4,990

Shareholder's Equity 9,395 6,923 9,395 6,923

Total Liabilities and Shareholder's Equity 23,416 14,809 23,416 14,809

Total Debt 8,978 4,620 8,978 4,620

Cash and Equivalents 2,901 2,984 2,901 2,984

Net Debt 6,077 1,636 6,077 1,636

INCOME STATEMENTNet Sales 4,558 3,030 17,283 12,107

Gross Profit 1,075 722 4,224 3,201

Operating Income 619 559 2,972 2,409

Net Income 537 533 2,433 1,993

EBITDA 921 614 3,528 2,735

EBITDA Margin 20.0% 20.3% 20.4% 22.6%

RATIOSNet Debt / Total Capitalization 38.0% 19.6% 38.0% 19.6%

Total Debt/EBITDA LTM 2.5x 1.7x 2.5x 1.7x

Net Debt / EBITDALTM 1.7x 0.6x 1.7x 0.6x

Consolidated FinancialsIn US$ millions (IFRS)

LTM = Last twelve monthsEBITDA = Earnings before interest, taxes, depreciation and amortization

1818

US$ MM

GROSS DEBT 8,978 100%

SHORT TERM 1,433 16%

Domestic Currency 657 7%

Foreign Currency 280 3%

Companies Abroad 496 6%

LONG TERM 7,545 84%

Domestic Currency 1,443 16%

Foreign Currency 1,451 16%

Companies Abroad 4,651 52%

CASH & CASH AND EQUIV. 2,901 100%

Domestic Currency 1,143 39%

Companies Abroad 1,758 61%

NET DEBT 6,077

DEBT STRUCTURE

Domestic Currency

19%

Foreign Currency 24%

Companies Abroad 57%

DEBT AVERAGE LIFE:6 years and 4 months

December 2007 (IFRS)

Consolidated Debt Profile

7.4%Companies Abroad

FX + 6.0%Foreign Currency

10.2%Domestic Currency

Brazil

COST OF DEBT (p.a.)

1919

BNDES: 323

Companies

Abroad: 145

FINIMP: 219

BNDES: 83

Companies

Abroad: 60

In US$ millions – December/07 (IFRS)

BNDES: 84

Companies

Abroad: 71

Companies

abroad: 232BNDES: 378

BNDES: 289

Debentures: 152

FINIMP: 129

Companies

Abroad: 140

Companies

Abroad:

1,055

SHORT TERM: US$ 1,433 LONG TERM: US$ 7,545

Consolidated Debt AmortizationPerpetual Bond: 600

Companies Abroad: 1,126

Companies

Abroad: 501

BNDES: 143Companies

Abroad: 134

BNDES: 91

Companies

Abroad:

1,685

663

216 227327

751 732866

1,895

1,292

2,009

1Q08 2Q08 3Q08 4Q08 2009 2010 2011 2012 2013 A fter2013

2020

ACTUAL 2007 (IFRS) INVESTMENT PLAN 2008–2010

In US$ millions

CAPEX

In US$ millions

6,3154,7741,541TOTAL

140

165

190

495

1,046

25

466

4,283

4,774

0

631Latin America

165Europe

4,473North America

5,269ABROAD

1,046BRAZIL

2007ACQUISITIONSCAPEX

859301416141Latin America

785264338183North America

2951169981Europe

1,939681853405ABROAD

TOTAL201020092008

4,4351,3751,9551,105BRAZIL

2,0561,510 2,808 6,374TOTAL

Capacity

Dec/2007

2008 2009 2010 New

Capacity*

Variation

Crude Steel 11,435 105 20 1,105 12,665 10.8%

Rolled Products 6,800 100 325 2,195 9,420 38.5%

Crude Steel 9,955 0 0 225 10,180 2.3%

Rolled Products 10,350 0 0 90 10,440 0.9%

Crude Steel 2,265 630 165 955 4,015 77.3%

Rolled Products 2,610 265 225 580 3,680 41.0%

Crude Steel 1,150 0 150 100 1,400 21.7%

Rolled Products 1,220 0 95 0 1,315 7.8%

Crude Steel 24,805 735 335 2,385 28,260 13.9%

Rolled Products 20,980 365 645 2,865 24,855 18.5%

TOTAL

Brazil

North America

Latin America

Europe

*Does not include acquisitions

2121

� BOARD OF DIRECTORS

- External members on the board

- Support Committee (Support and Excellence; Corporate Governance; Strategy

and Compensation and Succession)

� EXECUTIVE COMMITTEE

- Vice-presidents responsible for the Operations and Support Areas

- Support Committee ( Disclosure, Financial, Risk Management and Human

Resources and Orgazational Development)

� FISCAL BOARD (AUDIT COMMITTEE)

- Permanent and in accordance to the SOX (Gerdau S.A.)

Gerdau S.A. shares are included in the following São Paulo Stock Exchange indexes:

� Bovespa Index - Ibovespa

� Corporate Sustainability Index - ISE

� Special Tag Along Stock Index - ITAG

� Brazil Index 50 – IBrX 50

� Industrial Sector Index – INDX

HIGHLIGHTS:

� First Brazilian company to submit its Consolidated Financial Statements in conformity

with international accounting standards (IFRS)

� Tag Along (100% common and preferred shares)

� Bovespa Level 1

� Shares are negociated in Bovespa, Nova York Stock Exchange, Toronto Stock Exchange

and LATIBEX Stock Exchange

� Risk Management

� Gerdau Business System

Governance – Best Practices

2222

Disclaimer

This document can contain statements which constitute forward-looking

statements. Such forward-looking statements are dependent on

estimates, data or methods that may be incorrect or imprecise and that

may be incapable of being realized. These estimates also 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. Prospective investors are cautioned that any such forward-

looking statements are not guarantees of future performance and

involve risks and uncertainties. The Company does not undertake, and

specifically disclaims any obligation to update any forward-looking

statements, which speak only as of the date made.

2323

www.gerdau.com.br

inform@gerdau.com.br

+55 51 3323 2703