Usinas Siderúrgicas de Minas Gerais S.A. (B3: USIM5) reported strong numbers in the first quarter of 2025, a significant improvement over the previous year.
The company, one of Brazil’s largest flat steel producers, declared a net income of R$337 million ($59.08 million), a staggering 845% rise from the R$36 million reported in Q1 2024.
According to local media outlet InfoMoney, the result was far above market expectations, surpassing the R$225 million prediction from LSEG’s expert survey.
The increase was driven by better operating performance, indicating steadier domestic steel demand and a resurgence in automobile sector pricing.
EBITDA and revenue soar
Usiminas’ adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) were R$733 million in Q1 2025, up 76% from the previous year.
The company’s EBITDA margin increased to 11%, up four percentage points from Q1 2024, indicating enhanced efficiency and cost control.
Net sales increased to R$6.858 billion, up 10% yearly, as the company benefited from consistent demand and favourable pricing circumstances, particularly in its steel division.
Usiminas stated that revenue per ton in its steel industry has remained consistent, with automobile sector pricing providing a tailwind.
According to local media outlet InfoMoney, for the second quarter, Usiminas has a neutral and cautious, but also stable outlook.
The steel unit should see sales volumes similar to Q1, and pricing per ton is generally expected to be little changed.
On the other hand, Usiminas expects prices to increase from important automotive clients, which could further underpin margins if the demand holds.
While the company refrained from issuing updated full-year guidance, it did indicate that it is well-positioned to handle the prevailing economic backdrop, with fairly resilient industrial demand and ongoing cost-control actions.
Growth outlook not so bright
In a securities filing released Thursday, the company projected a tougher operating environment later in 2025.
“For the second half of 2025, we foresee a challenging and uncertain scenario,” it said.
Among the primary concerns: surging volumes of steel imports entering Brazil under what the company described as “conditions of unfair competition,” a reference to longstanding accusations that China is flooding global markets with underpriced material.
The company also pointed to domestic factors weighing on the industry, particularly elevated borrowing costs that continue to pressure demand.
“The impact on domestic consumption caused by the current high interest rates” is exacerbating the situation, Usiminas noted, adding that broader “uncertainties in international trade” are compounding the outlook.
Usiminas’ comments come as companies globally grapple with the implications of US President Donald Trump’s aggressive tariff policies, which have triggered retaliatory measures and amplified market volatility.
The Brazilian steel sector, in particular, has been vocal about the need for tighter controls on imports to shield local producers from what they claim is predatory pricing.
Usiminas reiterated its call for stronger government action to curb steel imports and level the playing field, highlighting once again the structural vulnerabilities of Latin America’s largest economy to global trade dynamics.
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