Feb. 8, 2007 — Gerdau Ameristeel Corp. reported net income of $69.4 million on net sales of $1.0 billion for the fourth quarter, and net income of $378.6 million on net sales of $4.5 billion for the year ended December 31, 2006

Fourth Quarter Results—The $69.4 million net income ($0.23 per share fully diluted) compares to a net income of $80.4 million ($0.26 per share fully diluted) for the three months ended December 31, 2005. Net sales of $1.0 billion compare to net sales of $0.9 billion for the three months ended December 31, 2005. EBITDA was $147.3 million, which compares to EBITDA of $157.3 million for the three months ended December 31, 2005.

Full Year Results— The $378.6 million net income ($1.24 per share fully diluted) compares to net income of $295.5 million ($0.97 per share fully diluted) for the year ended December 31, 2005. Net sales of $4.5 billion compare net sales of $3.9 billion for the year ended December 31, 2005. EBITDA was $756.4 million, which compares to EBITDA of $620.9 million for the year ended December 31, 2005.

Results include a pretax charge of approximately $41.8 million related to the closure of the meltshop operations of its Perth Amboy, N.J., wire rod mill. Included in selling and administrative expense for the year ended December 31, 2006 is a non-cash pretax expense of $34.4 million to mark-to-market outstanding stock appreciation rights and expenses associated with other executive compensation agreements compared to a non-cash pretax expense of $4.1 million for the year ended December 31, 2005.

During 2006, the company completed acquisitions in all of its vertically integrated operations. On November 1, 2006, the company completed the acquisition of a controlling interest in Pacific Coast Steel, a fabricator and installer of rebar with approximately a 200,000-ton capacity. On June 12, 2006, the company completed the acquisition of Sheffield Steel Corp. of Sand Springs, Okla., a minimill producer of long steel products (primarily rebar and merchant bars) with annual shipments of approximately 550,000 tons of finished steel products. On February 10, 2006, the company acquired Fargo Iron and Metal Co., a scrapyard and processing facility in Fargo, N.D., with approximately 50,000 tons of scrap-generating capacity.

In July 2006, the outstanding Sheffield Senior Secured Notes were redeemed for approximately $88.5 million. In September 2006, the company redeemed its Cdn $125.0 million convertible debentures for cash at par plus accrued interest. The company recorded an interest charge of $5.6 million to write off the remaining unamortized fair market adjustment of these convertible debentures.

On February 6, 2007, the Board of Directors approved a special dividend of $0.27 (twenty-seven US$ cents) per common share in addition to the regular quarterly dividend of $0.02 (two US$ cents) per common share, payable March 9, 2007 to shareholders of record at the close of business on February 22, 2007.

Fourth Quarter Operating Results—Excluding 50% owned joint ventures, the company shipped 1.5 million tons of finished steel in the fourth quarter, an increase of 2.2% over the year-earlier fourth quarter. Average mill prices for the quarter increased $45 per ton (8.3%) compared to the fourth quarter of 2005. Scrap raw material cost for the quarter decreased $2 per ton (1.3%) compared to the fourth quarter of 2005. Metal spread (the difference between mill selling prices and scrap raw material cost) for the quarter increased $48 per ton (13.4%) compared to the fourth quarter of 2005. Mill manufacturing costs were $266 per ton for the quarter compared to $249 per ton for the fourth quarter of 2005.

In order to maintain a balance between steel production and demand, the company curtailed production at most of its facilities in the fourth quarter. This reduced production level resulted in a significant increase in per-ton manufacturing costs, as the fixed costs are spread over a reduced number of tons.

Income from operations was $110.3 million, and the company’s share of the joint ventures’ operating income was $13.0 million. Based on 1.6 million tons of finished steel shipped, the composite operating income was $75 per ton for the quarter. For the fourth quarter of 2005, Gerdau Ameristeel's income from operations was $104.7 million, and its share of the joint ventures’ operating income was $23.1 million. Based on 1.7 million tons of finished steel shipped, the composite operating income for the fourth quarter of 2005 was $77 per ton.

Full Year Operating Results—Excluding 50% owned joint ventures, the company shipped 6.6 million tons of finished steel, an increase of 4.2% over the previous year. Average mill prices increased $51 per ton (9.8%) compared to 2005. Scrap raw material costs increased $16 per ton (8.7%) compared to 2005. Metal spread (the difference between mill selling prices and scrap raw material cost) increased $36 per ton (10.4%) compared to the previous year. Mill manufacturing costs were $249 per ton compared to $239 per ton for 2005. Fabricated steel prices increased $48 per ton compared to 2005.

Income from operations was $512.9 million, and the company’s share of the joint ventures’ operating income was $116.3 million. Based on 7.3 million tons of finished steel shipped, the composite operating income was $86 per ton. For 2005, Gerdau Ameristeel's income from operations was $400.5 million, and its share of the joint ventures’ operating income was $91.1 million. Based on 7.1 million tons of finished steel shipped, the composite operating income was $70 per ton for 2005.

CEO Comments—"Overall, we are encouraged by the record results of 2006,” commented Mario Longhi, President and CEO of Gerdau Ameristeel. “With safety at the forefront, we endeavor to maintain an exceptional human resource base, a solid operating and technical knowledge platform and a strong balance sheet with the flexibility to benefit from a wide range of potential economic scenarios.

“We expect our normal springtime demand strengthening to maintain a favorable price and spread environment for our bar products. The health of the construction sector is confirmed by our rebar fabrication backlog which is strong in terms of price and volume. Gallatin's hot rolled sheet order book has improved measurably and we are hopeful that hot rolled prices and spreads will reverse the deteriorating trend exhibited in the fourth quarter of 2006.

“Even with the challenges that the cyclical nature of our business poses,” continued Longhi, “we believe our organization is fully prepared to continue to optimize its performance through relentless execution of our core values and business strategies. We are focused on further building on the safety and productivity gains we achieved in 2006. In order to remain competitive on a global basis, we have budgeted $250 million for capital investments in 2007."

Gerdau Ameristeel is the second-largest minimill steel producer in North America with annual manufacturing capacity of over 9.0 million tons of mill-finished steel products. Through its vertically integrated network of 17 minimills (including one 50%-owned joint venture minimill), 17 scrap recycling facilities and 51 downstream operations (including seven joint venture fabrication facilities), Gerdau Ameristeel serves customers throughout North America. The company's products used in a variety of industries, including construction, automotive, mining, cellular and electrical transmission, metal building manufacturing and equipment manufacturing.