GGB Gerdau SA

FORM 6-K

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE

SECURITIES EXCHANGE ACT OF 1934

Dated November 6, 2014

Commission File Number 1-14878

GERDAU S.A.

(Exact Name as Specified in its Charter)

N/A

(Translation of Registrant’s Name)

Av. Farrapos 1811

Porto Alegre, Rio Grande do Sul - Brazil CEP 90220-005

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F  x    Form 40-F  o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes  o    No  x

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):  Not applicable.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused the Report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date:  November 6, 2014

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EXHIBIT INDEX

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Exhibit 99.1

Mission

To create value for our customers, shareholders, employees and communities by operating as a sustainable steel business.

Vision

To be a global organization and a benchmark in any business we conduct.

Values

Be the CUSTOMER’S choice

SAFETY above all

Respected, engaged and fulfilled EMPLOYEES

Pursuing EXCELLENCE with SIMPLICITY

Focus on RESULTS

INTEGRITY with all stakeholders

Economic, social and environmental SUSTAINABILITY

Gerdau is the leading manufacturer of long steel in the Americas and a major global supplier of special steel. In Brazil, also produces flat steel and iron ore, activities that are expanding its product mix and the competitiveness of its operations. With more than 45,000 employees, Gerdau has industrial operations in 14 countries — the Americas, Europe and Asia — with a combined installed capacity of more than 25 million tonnes of steel a year. It is also Latin America’s biggest recycler and, worldwide, transforms millions of tonnes of scrap metal into steel every year, reinforcing its commitment to sustainable development in the regions where it operates. With more than 120,000 shareholders, Gerdau’s shares are listed on the New York, São Paulo and Madrid stock exchanges.

Highlights in the third quarter of 2014

(1) Total capitalization = shareholders’ equity + gross debt (principal)

(2) Net debt = gross debt (principal) - cash, cash equivalents and short-term investments

(3) EBITDA in the last 12 months

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World Steel Market

Source: worldsteel and Gerdau

(1) Figures represent approximately 98% of total production in 65 countries.

·      In 3Q14, world steel production grew in relation to 3Q13 (see table above), with China accounting for 50.4% of global production. Production performance in the regions where Gerdau operates was as follows: in developed markets, represented by North America and Europe, the increased production was due to the continued economic growth observed in particular in the United States; on the other hand, in Brazil and Latin America, steel production decreased in the period due to lower economic growth rates combined with higher imports. Capacity utilization in the world steel industry stood at 76.1% in September 2014.

·      On October 06, 2014, the World Steel Association released its latest Short Range Outlook containing growth forecasts for global apparent steel consumption in 2014 and 2015 of 2.0% for both years. The association expects weaker growth than the forecast announced in April 2014 (+3.1% in 2014 and +3.3% in 2015), due to lower-than-expected growth in both emerging and developing economies. China is expected to register slower consumption growth in the next two years (+1.0% in 2014 and +0.8% in 2015) due to the structural transformation of its economy. On the other hand, the continuous growth of the U.S. economy should support growth in that country’s apparent consumption of 6.7% in 2014 and 1.9% in 2015. Also in European Union, apparent consumption is expected to grow by 4.0% in 2014 and 2.9% in 2015. In short, apparent steel consumption in developed economies should grow by 4.3% in 2014 and 1.7% in 2015, while developing economies should grow by 1.2% in 2014 and 2.2% in 2015.

Gerdau’s performance in the third quarter of 2014

The Consolidated Financial Statements of Gerdau S.A. are presented in accordance with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) and the accounting practices adopted in Brazil, which are fully aligned with the international accounting standards issued by the Accounting Pronouncement Committee (CPC).

The information in this report does not include data for jointly controlled entities and associate companies, except where stated otherwise.

Consolidated Information

Steel production and shipments

·      Consolidated crude steel production remained relatively stable in 3Q14 compared to 3Q13, with production growth in the North America Business Operation (BO) offsetting the reductions observed in the other BOs. Compared to 2Q14, production decreased in all BOs, as will be explained in the item “Business Operations (BO).”

·      Consolidated shipments decreased in 3Q14 compared to 3Q13, reflecting the lower shipments, especially in the Brazil BO. Compared to 2Q14, shipments remained stable, with the performance at each BO varying.

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Consolidated results

Net sales, cost and gross margin

·      In 3Q14, consolidated net sales increased compared to 3Q13, mainly due to the net sales growth recorded mainly by North America BO. Compared to 2Q14, consolidated net sales increased, with the performance of each BO varying.

·      On a consolidated basis, gross profit and gross margin fell in 3Q14 compared to 3Q13 due to the weaker performance of the Brazil BO, which was partially offset by the better performance of the North America BO. Compared to 2Q14, the relative stability in consolidated gross profit and gross margin was due to the better performance of the North America BO, which offset the reductions observed in the other BOs.

Selling, general and administrative expenses

·      Selling, general and administrative expenses as a ratio of net sales decreased slightly in relation to both comparison periods, demonstrating the Company’s efforts to rationalize these expenses.

Other operating income (expenses) and Equity income

·      The jointly controlled entities and associate companies, whose results are calculated using the equity method, recorded steel shipments of 313,000 tonnes in 3Q14 based on their respective equity interests, resulting in net sales of R$ 612.5 million and equity income of R$ 35.2 million.

EBITDA

(1) Includes the results from jointly controlled entities and associate companies based on the equity income method.

Note: EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is not a method used in accounting practices, does not represent cash flow for the periods in question and should not be considered an alternative to cash flow as an indicator of liquidity. The Company’s EBITDA was calculated pursuant to Instruction 527 of the CVM.

(1) Non-accounting measurement adopted by the Company.

(2) Accounting measurement disclosed in consolidated Statements of Income.

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Consolidated EBITDA (R$ million) and EBITDA Margin (%)

·      Consolidated EBITDA and EBITDA margin decreased in 3Q14 from 3Q13, mainly due to the weaker performance of the Brazil BO, which was partially offset by the better performance of the North America BO and by the higher equity income and gains in operating expenses. In the comparison with 2Q14, the increases in consolidated EBITDA and EBITDA margin were mainly due to the better performance of the North America BO.

Net Financial Result and Income

(1) Includes the results from jointly controlled entities and associate companies based on the equity income method.

·      In 3Q14 compared to 3Q13, the higher negative financial result mainly reflects the higher negative net exchange variation on liabilities contracted in U.S. dollar (depreciation in the closing price of the Brazilian real against the U.S. dollar of 11.3% in 3Q14 and 0.6% in 3Q13) and higher financial expenses resulting from an increase in gross debt in the compared periods.

·      Compared to 2Q14, the higher negative financial result was mainly due to the negative net exchange variation in 3Q14 compared to the positive exchange variation in 2Q14 (depreciation of 11.3% in 3Q14 and appreciation of 2.7% in 2Q14).

·      Note that, in accordance with IFRS, the Company designated the bulk of its debt in foreign currency contracted by companies in Brazil as a hedge for a portion of the investments in subsidiaries located abroad. As a result, only the effect from exchange variation on the portion of debt not linked to investment hedge is recognized in the financial result, with this effect neutralized by the line “Income and Social Contribution taxes on net investment hedge.”

·      Consolidated net income decreased in 3Q14 compared to 3Q13, which is explained by the lower operating income and higher negative financial result in the period, and the recognition of the effects from joining the Refis program on profits generated abroad in the net amount of R$ 87 million in 3Q14. Compared to 2Q14, the decrease in net income was mainly due to the higher negative financial result and the recognition of the Refis program in 3Q14 results.

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Dividends

·      The companies Metalúrgica Gerdau S.A. and Gerdau S.A., based on the results in 3Q14, approved the prepayment of the minimum mandatory dividend for fiscal year 2014, as shown below:

·          Payment date: November 27, 2014

·          Record date: close of trading on November 17, 2014

·          Ex-dividend date: November 18, 2014

·          Metalúrgica Gerdau S.A.

·          Dividends: R$ 16.3 million (R$ 0.04 per share)

·          Gerdau S.A.

·          Interest on equity: R$ 85.2 million (R$ 0.05 per share)

·      In the first nine months of 2014, Metalúrgica Gerdau S.A. and Gerdau S.A. distributed R$ 89.4 million and R$306.8 million in the form of dividends and interest on equity, respectively.

Investments

·      In 3Q14, investments in fixed assets amounted to R$ 438.2 million. Of the amount invested in the quarter, 20.1% was allocated to the Brazil BO, 38.0% to the Special Steel BO, 16.0% to the North America BO, 16.5% to the Latin America BO and 9.4% to the Iron Ore BO.

·      In the first nine months of 2014, investments in fixed assets amounted to R$ 1.6 billion. The Company continued to invest in its ongoing capacity expansion and productivity improvement projects, as well as in the maintenance actions scheduled for the period in both Brazil and abroad. Based on the investments already made and scheduled for the fourth quarter, Gerdau made a new review of its investment plan, planning to invest a total of R$ 2.1 billion in 2014.

Working capital and Cash conversion cycle

·      In September 2014, the cash conversion cycle (working capital divided by daily net sales in the quarter) was stable in relation to June 2014, due to the growth in net sales and working capital in the same proportion.

·      Note that the increase in working capital of R$ 320 million between June and September includes the effects of exchange variation, especially on the working capital of companies abroad. Excluding this variation, the cash effect on working capital was a reduction of R$ 277 million.

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Financial liabilities

(1) Net debt = gross debt (principal) - cash, cash equivalents and short-term investments

·      On September 30, 2014, the composition of gross debt (principal) was 8.9% short term and 91.1% long term. The foreign currency exposure of gross debt (principal + interest) stood at 76.8% on September 30, 2014.

·      The increase in the cash position of R$ 708 million between June and September 2014 was driven mainly by cash generation in the quarter, as well as by exchange variation in the period. On September 30, 2014, 50.6% of this cash was held by Gerdau companies abroad and denominated mainly in U.S. dollar.

·      The 7.9% increase in net debt on September 30, 2014 compared to June 30, 2014 is explained by the effect of exchange variation on gross debt, which was partially offset by the higher cash position.

·      On September 30, 2014, the nominal weighted average cost of gross debt (principal) was 6.5%, or 9.1% for the portion denominated in Brazilian real, 5.9% plus foreign exchange variation for the portion denominated in U.S. dollar contracted by companies in Brazil, and 5.8% for the portion contracted by subsidiaries abroad. On September 30, 2014, the average gross debt term was 7.2 years.

·      The Company’s main debt indicators are shown below:

(1) Total capitalization = shareholders’ equity + gross debt (principal)

(2) Net debt = gross debt (principal) - cash, cash equivalents and short-term investments

(3) Last 12 months

Indebtedness

(R$ billion)

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·      On September 30, 2014, the gross debt (principal) payment schedule was as follows:

Amortization schedule of gross debt (principal)

Subsequent Events

Assets sale in USA

·            On October 8, 2014, Gerdau and ArcelorMittal jointly completed the sale of their respective 50% interests in Gallatin Steel Company to Nucor Corporation for total cash consideration of US$ 770 million. Gallatin is a flat rolled mini-mill located in Gallatin County, Kentucky, USA with annual production capacity of 1.8 million short tons. The sale of Gallatin is aligned with the Company’s strategy of focusing its efforts on improving the returns on its core assets. In addition, this initiative will strengthen Gerdau’s balance sheet, due to the increase in the cash position.

Merger of operations in Dominican Republic

·            On October 7, 2014, Gerdau and Complexo Metalúrgico Dominicano S.A. confirmed the merger of operations of its companies Industrias Nacionales and METALDOM, becoming denominated Gerdau Metaldom. This merger aims more efficiency and competitiveness in the Caribbean and Central America region and assures the supply of steel products for construction sector in the Dominicam Republic.

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Business Operations (BO)

The information in this report is divided into five Business Operations (BO), in accordance with Gerdau’s corporate governance, as follows:

·      Brazil BO — includes the steel operations in Brazil (except special steel) and the metallurgical and coking coal operation in Colombia;

·      North America BO — includes all North American operations, except Mexico and special steel;

·      Latin America BO — includes all Latin American operations, except the operations in Brazil and the metallurgical and coking coal operation in Colombia;

·      Special Steel BO — includes the special steel operations in Brazil, Spain, United States and India.

·      Iron Ore BO — includes the iron ore operations in Brazil.

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Brazil BO

Production and shipments

·      In 3Q14 compared to 3Q13, crude steel production decreased, mainly due to the lower shipments in the period.

·      Steel shipments decreased in 3Q14 compared to 3Q13, due to weaker demand caused by slower growth in the construction and manufacturing industries, reflecting the country’s weak GDP growth. Compared to 2Q14, shipments in 3Q14 registered growth due to higher exports, driven by improvement in the international market for semi-finished products.

Operating result

(1) Includes coking coal and coke net sales.

·      The lower net sales in 3Q14 compared to 3Q13 was mainly due to the lower shipments in both the domestic and export markets. Compared to 2Q14, the increase in net sales was mainly due to higher exports in the period and a better product mix in the domestic market.

·      Cost of goods sold decreased in 3Q14 compared to 3Q13, though at a slower pace than the decline in shipments. This effect was mainly due to the reduced dilution of fixed costs. The reduction in net sales to a greater degree than the reduction in cost of goods sold led to a reduction in gross margin in the period. The reduction in gross margin compared to 2Q14 was due to the poorer mix of markets resulting from the higher exports in the period.

·      The lower EBITDA in 3Q14 compared to 3Q13 was due to the decrease in gross profit in the period and led to a reduction in EBITDA margin.

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EBITDA (R$ million) and EBITDA Margin (%)

North America BO

Production and shipments

·      Production increased in 3Q14 compared to 3Q13, mainly due to the lower production in 3Q13, a period marked by increased efforts to optimize inventories.

·      Shipments increased in 3Q14 compared to 3Q13, driven by continued strong demand from the industrial sector and continued growth in non-residential construction.

Operating result

·      Net sales increased in 3Q14 compared to 3Q13, due to the increase in net sales per tonne sold and higher volumes. The increase in net sales to a higher degree than the increase in cost of goods sold supported gross margin expansion in the period.

·      Gross margin expanded in 3Q14 compared to 2Q14, due to the increase in net sales per tonne sold and, to a lesser degree, the lower cost of scrap used in the period.

·      The higher EBITDA recorded in 3Q14 compared to both 3Q13 and 2Q14 is explained by the increase in gross profit, which supported EBITDA margin expansion in both comparison periods.

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EBITDA (R$ million) and EBITDA Margin (%)

Latin America BO

Production and shipments