Good morning, and welcome to Gerdau's conference call about the results referring to the third quarter of 2013. [Operator Instructions] We would like to emphasize that any forward-looking statement that might be made during this conference call related to Gerdau's business outlook, projections and financial and operating goals are mere assumptions based on the management's expectations related to the future of the company. Even though Gerdau believes that its comments are based on reasonable assumptions, there is no guarantee that future events will not affect this evaluation. Here today are: Mr. Andre Gerdau Johannpeter, Director, President and CEO of the company; and André Pires, Vice President and IR Director. Now I would like to give the floor to Mr. Gerdau Johannpeter. You may proceed. André Bier Gerdau Johannpeter: Thank you. Good afternoon, everyone, and welcome to our conference call to talk about the results of the third quarter of 2013. We will begin our analysis by looking at the steel market landscape; and later on, we will talk about Gerdau's performance during the third quarter and the outlook for the regions where the company operates. Right afterwards, André Pires will give you more details on the company's financial performance and after that, we will be available to take your questions. It's also important to highlight that in our presentation, we will evaluate the performance of the third quarter when compared to the same period of the year before. Moreover, we will also comment on Gerdau's year-to-date performance. So I would like to start by giving you an overview of the industry, it's on Slide 2. Now talking about the world steel production, it reached 396.4 million tonnes in the third quarter, up 4.1% when compared to the same period of 2012. Excluding China, the world production was 198.9 million tonnes,…

[Operator Instructions] Our first question comes from Mr. Rodolfo De Angele from JPMorgan. Rodolfo R. De Angele - JP Morgan Chase & Co, Research Division: I have 2 questions. The first regarding the Brazil operation. This is a positive surprise. Growth has been robust. I'd like to know a little bit more what to expect short term, particularly taking into account the imports. We know that we have new competitors coming in. And in the last call last quarter, you talked about potential measures and the upside potential. So short term and medium term, how do you see Brazil? And also, I'd like to have an explanation, for the United States, which seems to be in an opposite situation, what could we expect in margins? And in the States, there seems to be an antidumping against rebars coming from the United States and for Mexico. So could you elaborate on this, please. André Pires de Oliveira Dias: Rodolfo, this is André Pires and thank you for your question. Let's start with Brazil. In fact, we had a good quarter for several reasons. The market continues to present relatively stable and sound demand in real estate and infrastructure. And as André has commented and also the opportunities of exports that we had because of the currency devaluation, which gave us the opportunity to export [indiscernible] in this quarter. And also, part of this improvement comes from internal initiatives, efficiency gains, cost reductions, which have helped us to improve our gross margins. So I'd say a combination of good business environment and internal initiatives, which are leading to good results. And now I'll ask André to talk about North America. André Bier Gerdau Johannpeter: Thank you, Rodolfo. In North America -- well, it's been a difficult year, this quarter has been difficult…

Our next question comes from Leonardo Correa from HSBC.

My first question has to do of domestic market prices. Perhaps you could give us some greater detail, what can we expect in carryover of benefits from already implemented prices now in the third to the fourth quarters, my first question. And the second, Açominas, you still have not received the contribution of Açominas and or a margin of EBITDA 35% to Brazil. So I'd like to know your scenario for Açominas next year, how much will you be able to -- how much will it contribute? What is the sales contribution also in the domestic market? I think that will help us. I do think it's reasonable to assume that these -- this shipment would have an EBITDA per tonne of about $100. So these are my 2 questions, Açominas and the question of these new market that you are entering and the price in the domestic market, if there's any carry over to the fourth quarter. André Bier Gerdau Johannpeter: Leonardo, this is André. Thank you for your question. Regarding the domestic environment and prices, you know we don't like to talk too much about that, but what we could say is that we expect a relatively similar fourth quarter in terms of price with what we have had in the third quarter. Nothing too different. Obviously, you know that there is a seasonality in the fourth quarter every year, like in the first quarter that has to be taken into account. But we don't see anything significant event from the third to the fourth quarters, which has to do with -- what might lead to profitability. Regarding Açominas, it's now tied to Ouro Branco, the Ouro Branco mill, which we will have coiled hot-rolled strips really mill, but from now on we will not be giving specific numbers about production and shipment. But we expect it to yield production started now in August, September, and we are already in -- selling in October. Next year will be a year of -- well only until the end of this year, but next year we will have a good level of operations, bringing in contributions and a good results for Brazil, with the start up of that mill. I don't have any specific numbers to give you, but certainly it will contribute next year.

Just to confirm, the term -- is it -- tonnage still 800,000 full capacity. And most of that will be for the domestic market, right? André Bier Gerdau Johannpeter: Yes, 800,000 capacity and both external and domestic, depending on the demand. We don't have this yet too clear, but for both markets in fact.

Your next question comes from Renato Antunes from Brasil Plural.

First of all, the question on prices in Brazil. I know you don't like to talk about numbers, but qualitatively, what about your strategies when you think about prices, vis-à-vis import strategies, imports from Turkey to Brazil, we know things are volatile. So how are you seeing that? Can you work with a higher premium than we've had in the last few years? Or are we still going to see that those numbers, 15%, which was a sustainable premium? And second question, going back to the United States, I'm not sure that you can share with us, but regarding the potential antidumping study, is there any timing expectation? Anything that you can help on that subject would be welcome. André Bier Gerdau Johannpeter: Renato, this is André. I will speak about premiums or prices, because as always, things vary a lot. These export peaks. Also, we have months that goes from imports in Brazil. There are peaks. Some months we have 0. Sometimes, we have a high peak. So you have to take the average. And price, any forecast would depend on domestic demand, world supply, exchange rates, so it's very difficult to make any forecasts. André Pires de Oliveira Dias: Regarding antidumping, it's very difficult to have a forecast and with the shakedown of the government, all the processes that have been taken up into the federal sphere, has obviously been delayed. So we think that by the end of the year, we should have some indication from the government, but it's difficult to say what the timing might be.

Our next question comes from Mr. Carlos de Alba from Morgan Stanley.

I have a couple of questions. The first one is, it seems that there were a couple of nonrecurring events during the quarter. One, the costs associated with the closure of the melt shop in Canada and second, the learning curve of the Indian operation. Is it possible, André, to quantify how much these 2 events cost the company, which would have had an even higher EBITDA if they were in there? And my second question is on North America. When I looked at the results of Nucor and Steel Dynamics and I looked at the breakdown of their product shipments, the structural business of these 2 companies grew volumes by 18% year-on-year. So clearly, there is something that may be affecting more Gerdau than these 2 competitors. And if you can give us some more color, that will be very useful, because the only thing we have been seeing a negative year-on-year growth in shipments in North America for almost a year now. André Pires de Oliveira Dias: This is André Pires. I will just translate what you said. The first thing relates to nonrecurring effects. I think you talked about the temporary shutdown of the melt shop in Canada and our mill in Cambridge, and you also talk about a nonrecurring item in India. I will try to start by answering these questions first. Now in terms of that nonrecurring event in Canada, that comes to BRL 70 million, about USD 8 million and with -- that was a nonrecurring posting of the temporary shutdown of the melt shop in Cambridge, and that we will serve the needs for billets with the melt shop that is nearby in Woodby [ph] and also very close to Toronto. We are just trying to rationalize that operation. In terms of India,…

And could you comment a little bit as to what measures the company is taking to alleviate the impact of the installation of the new management software in the U.S.? I assume that this obviously had an impact on volumes and the relationship with some customers. What are the measures that the management team is taking to alleviate the situation and make sure that you regain these volumes, in the coming quarters? André Pires de Oliveira Dias: This is, again, André Pires. I think your question is about the new management software deployment and what was the impact of that new software and what are the initiatives that we are adopting. Basically, we are gradually resuming the volumes that, throughout the 12 months deployment period, the volume was lost, now the volume is being resumed by improving our service platform and now we are also going back to our production levels. This was already forecasted. And so, the management is working very, very hard to be able to resume the volumes during the deployment of the software was affected.

Our next question comes from Thiago Lofiego from Merrill Lynch.

I have 2 questions, and the first one has to do with your cost estimate for the Brazil unit. I would just like to explore them a little bit. Item per item, where were you able to notice a significant margin reduction now and vis-à-vis the year before, and whether you see room for more gains in that unit? And also I would like you to talk a little bit about the scrap market in Brazil, and what is your pricing structure from now on? André Pires de Oliveira Dias: Here is André Pires. In terms of costs for -- in Brazil and the reduction that we see, maybe a slower growth in sales cost. We had already mentioned that sometime ago and André also talked about it last year. We are in the final processes to conclude the merger of the old Açominas, the former Açominas, with the long's operations in Brazil. This merger brought about many benefits in terms of daily activities that were in both companies, like procurement, support in general. And because of that, once we merge the areas, we had many gains: purchase of materials, exports, commercial areas. And all of these gains were very important because they helped us to reduce costs and also to improve efficiencies. It's just a combination between cost reduction and efficiency gains. And we are working diligently to improve the situation further. So I believe that this is one of the main reasons why the sales growth was lower than the net sales revenue. André Bier Gerdau Johannpeter: André, I'd just like to interrupt you a little bit. What about cost per tonne? It was better, right, if you look at the previous quarter? So I think we can say that this is sustainable. And I think you can say that you have room for more gains in this cost per tonne from now on. Thiago, in a way, this is also working capital. You try to make adjustments, as much as possible, to gain more efficiencies in your operation. So in terms of gains or many of the gains that we were able to have, they were captured because of all of the opportunities that we had. But the main opportunities were already harvested. We already used them. Now about scrap, you ask about the general market or you just want to learn something specific?

No, just about the general market and what is the position in terms of the use of scrap at the moment. André Bier Gerdau Johannpeter: It's very difficult to make predictions because the market finds itself in a quite stable position. With a more depressed global demand, the appetite for scrap in the world also decreases. And one way or the other, the U.S. also influences here. There's also a demand for pig iron in Brazil, and that impacts our business because we can use 20% up to 30% of pig iron and this has an impact in the final price of scrap. So I do not have any prediction that I could probably tell you, but there are many things that end up by impacting the scrap market.

Our next question is from Marcos Assumpção from Itaú. Marcos Assumpção - Itaú Corretora de Valores S.A., Research Division: My question is about the Brazilian business unit. Could you please make a distinction between revenue per tonne in the domestic market, which was up 4%, how much of that was the effect of products and how much of that was the impact of actual price increases? And also, having that outlook in mind and looking ahead into the future, maybe there is still the possibility of recent increases and discount reductions, whether you see that this should have an impact for the future. In terms of heavy plate, if you look at the antidumping outlook in Brazil and whether that also has an impact in your rolling mill. André Pires de Oliveira Dias: Here is André Pires. Thank you for your questions. I would say that there is a combination of things. There's a combination between mix and positive market conditions. It's very difficult to say how much each of these items -- how much they weigh in an improvement of sales per tonne. We increased exports when compared to the second quarter of 2013, due to some specific opportunities that we saw in international markets that we had put on the side for a while because of not very favorable prices in the international market, and also because our currency, the riyal, was too appreciated. So it was just a combination of factors, there is an opportunity and we see that -- if in the future we see other opportunities, we will try to take advantage of them. But it will depend on market conditions. It's just a combination of things we see that things are improving. Marcos Assumpção - Itaú Corretora de Valores S.A., Research Division: And now you still have to tell me a little bit about heavy plate. André Pires de Oliveira Dias: Nothing changes in terms of our investments, it's still according to plan. Now the next step is the assembly, and that was part of our pipeline. So nothing changes in terms of the heavy plate investment.

Our next question comes from Diogo Miura from Goldman Sachs.

I'm Marcelo Aguiar. I would like to learn more about iron ore and how are you operating for next year and whether you are about to make an agreement for medium long term with the other players? And what is the volume expectation for next year? And the second question refers to CapEx, your average CapEx. I know that you have a 4- to 5-year plan, but maybe you can tell me, for next year, what do you expect to invest. André Pires de Oliveira Dias: Marcelo, this is André Pires. In terms of mining and starting with the port solutions, I think I already said that before. But in fact, we have already contracted some space in the port. So in the short run, our situation is very comfortable. We have -- there is available capacity in the market. But in the mid- and long-range, we will have to wait a little. We will wait to see what are the alternatives in the mid and long-range. And in our view, there will be capacity in the ports available in the next coming years. In terms of volumes, we are now reaching the end of 2013 with a production pace of 11.5 million tonnes, this when we had a start-up of Miguel Burnier, which is our processing unit, and then we were able to expedite the production of ore. And the forecast for 2014 is -- sales to third parties, we do 4,000 tonnes, and we will maintain our original plans to reach 8 million tonnes by 2016. Now I'll give the floor to André who will talk about CapEx. André Bier Gerdau Johannpeter: In terms of CapEx, we will just update the figures in February. We are just concluding the projections for the next 5 years. So then we will then extract the numbers for 2013 out of that announced total amount, and then we will just post the numbers for the following year. There's still some investments underway. They are large investments, and there are always new ones on the way too, but the trend is that we will keep that same level of CapEx for the near future. So this is the trend and probably, we will announce the package for CapEx for the next 5 years, which is very similar to what we've done so far.

Just some clarification. In terms of your 2-year ore contract, is that a simple tariff? Or it's a variable tariff? André Bier Gerdau Johannpeter: There are several agreements and each one involves a different situation as these are commercial contracts. It's difficult for me now to get into details. But in what concerns our production cost and international prices, we believe that this agreement makes sense to us.

Our next question is from Renato Antunes from Brasil Plural.

I have a very quick question. Could you please talk a little bit about the plate -- or the flat market and whether you -- what you see ahead? And the second question refers to specialty steel, especially in Brazil. And I would just like to hear from you how -- how do you see the demand for this segment in 2014, whether there are some different ideas. Some people have more negative assets for 2014. So what's your view for this market next year? André Bier Gerdau Johannpeter: This is André. About slabs in the domestic market. We see that as an opportunity that comes in and comes out, it's very difficult to say that next year we'll be able to say something, there will be less slabs available, we would do less exports. And if there is something in the domestic market, we will certainly do that, because it's always better to operate in the domestic market than to export. But this is not structural and it's not constant for every quarter. Well, regarding specialty steels, that's interesting because heavy-duty vehicles this year experienced good growth, especially in the first quarter. In the second quarter, it was not so significant. But there is also a big question whether BNDES will still maintain financing of trucks. They are boosting these sales. And so if that contract is renewed, so the situation will remain as is. Otherwise, we will experience some decrease, especially in that segment of heavier duty trucks and in other instances where BNDES financing is not so important.

With that, we conclude the Q&A session. Now I would like to give the floor to Mr. André Gerdau Johannpeter and Mr. André Pires for their final remarks. André Bier Gerdau Johannpeter: Thank you all very much. Thank you for expressing interest in our conference call. If you still have any questions, our IR team will be available to clarify your doubts. So now, I would like to invite you all for our next call, which will be in February, probably in the third week of February. Have a good day.

Gerdau's conference call is now concluded. I would like to thank you all for participating and I wish you a good afternoon.