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By Guillermo Parra-Bernal and Alberto Alerigi Jr.
SAO PAULO, May 4 (Reuters) - Gerdau SA, the largest steelmaker in the Americas, swung to an unexpected first-quarter loss on Thursday, reflecting declining revenue and the impact of a recent Brazilian ruling on the booking of contingent liabilities.
Gerdau lost a net 34 million reais ($10.8 million) last quarter, compared with net income of 14 million reais a year earlier. Analysts expected profit of 70.96 million reais in the quarter.
Production and sales of steel fell 3.3 percent and 6.8 percent, respectively, from a year earlier, while net revenue fell 16 percent to 8.459 billion reais. The result missed the consensus estimate of 8.866 billion reais, as compiled by Thomson Reuters.
Costs fell a tad slower than revenue in the period, while sales, general and administrative expenses dropped a bigger-than-expected 32 percent. Chief Executive Officer Andre Gerdau Johannpeter is moving to boost mill efficiency and cut payroll by the end of the decade.
In a securities filing, Porto Alegre, Brazil-based Gerdau also said it may earmark 1.3 billion reais for capital spending this year. Management will discuss quarterly results later in the day.
Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) fell 8.3 percent last quarter, more than expected. Adjusted EBITDA, a gauge of operational profit, totaled 853 million reais in the January-through-March period, compared with the estimate of 1.008 billion reais.
Part of the decline in adjusted EBITDA came as Gerdau recalculated the value of unspecified contingent liabilities, leading to a net charge of 858 million reais in the quarter. ($1 = 3.1809 reais) (Editing by Chizu Nomiyama and Jeffrey Benkoe)