Brazil-based steel producer Gerdau continues to generate relatively stable margins and cash flow generation despite weak industry demand for steel products in its main market, Brazil, thanks to its sound geographic diversity. We have affirmed our 'BBB-' global scale and 'brAAA' national scale ratings on Gerdau S.A. and its U.S.-based subsidiary Gerdau Ameristeel Corp., including the corporate credit ratings. The stable outlook reflects our expectation that management is committed to reduce leverage, and maintaining a strong liquidity, a smooth debt amortization profile, and a sound balance of domestic and foreign operation, while debt to EBITDA gradually reduces to 3x despite the weaker Brazilian currency and demand for steel. On Aug. 24, 2015, Standard&Poor's Ratings Services affirmed its 'BBB-'
