Our quarterly report is not as detailed as in the past as the company does not take our calls, and the press release was very short. Net sales fell 15% compared to 4Q98 due to a reduction in real steel prices which resulted from the inflation/revaluation effect. This was partially offset by a 5% increase in total volumes, amounting to 693K tons during the quarter. Total steel volumes continued on the rise compared to 3Q99.
On the other hand, gross and operating income rose 11% and 26% respectively. We believe this was due to cost savings (originating from the new business plan for the period 1999-2003)), and lower costs (vertically integrated). As a result, gross and operating margins increased considerably. However, it is important to note that 4Q98 was an unusually poor quarter. Also, we were a bit puzzled with operating expenses in 4Q98 and 4Q99, which were considerably lower compared to previous quarters. In our view, this is probably the result of some kind of reclassification. Overall, EBITDA increased 33%. In addition, EBITDA margin continued to improve compared to previous quarters.
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