Brazilian steelmaker Gerdau has decided to postpone some of its capacity expansion investments expected for 2019 amid a weaker-than-expected local economy, while reporting year-on-year output growth for the second quarter.
It has maintained, however, its 7.1 billion Reais ($1.79 billion) total capital expenditure plan through 2021.
The company estimated 1.84 billion Reais of investments for 2019, a decrease from the previous 2.2 billion Reais forecast, it said on Wednesday August 7. Most of the cuts were made in Brazilian expenditures for expansion and technology updates, chief financial officer Harley Scardoelli stated in a conference call.
“Despite the slower pace of investments, we will still report a growth in investments,” Scardoelli added. “But as Brazil’s economy did not recover as fast as expected, we are delaying some of the expenditures to the following years.”
One of the postponed projects was a capacity increase of 230,000 tonnes per year…