Gerdau SA reported fourth quarter profit that beat analysts' estimates on rising demand in Brazil and North America.

Net income rose to BRL 438.8 million from BRL 369 million in the year earlier period. Gerdau was expected to post a BRL 352.4 million profit excluding items, the average of seven estimates compiled by Bloomberg.

Gerdau said that demand for steel used in construction increased in Brazil as banks boosted lending for homes, while manufacturers and energy companies drove up sales in North America.

Net sales jumped 16% to BRL 9.1 billion in the quarter. Sales at Gerdau's North American unit, which accounts for about a third of revenue, increased by 10% in volume, while domestic sales jumped 15%.

Crude steel output climbed 8% to 4.73 million tonnes in the quarter, while production of rolled steel increased 9% to 3.98 million tonnes.

The company reported a financial loss of BRL 82 million, less than the BRL 184 million it had a year ago, as it used part of proceeds from its BRL 5.5 billion share sale in April 2012 to pay some debt in advance.

Mr Andre Gerdau Johannpeter CEO of Gerdau is still considering options to monetize the company's mining assets, which hold about 2.9 billion tonnes of iron ore reserves.

The company hired Goldman Sachs Group Inc as an adviser to see alternatives for the company's mining assets. Gerdau plans to invest BRL 10.3 billion between 2012 and 2016, including the expansion of its iron ore output and a port in Colombia.

(Sourced from www.bloomberg.net)