EUROMETAL PRESENTATION EUROPE STEEL TRADE CONFERENCE STRESA, APRIL 27-29, 2014 POSITION OF STEEL DISTRIBUTION IN EU STEEL MARKETS GEORGES KIRPS, DIRECTOR GENERAL EUROMETAL

EUROMETAL THE VOICE OF EUROPEAN STEEL, TUBE AND METAL INTERMEDIATION ABOUT EUROMETAL MONITORING TODAY - ASSESSING TOMORROW – WE KNOW STEEL PLEASE NOTE: WHEN PRINTING USE OPTION [ADAPT TO SIZE]

EUROMETAL IS A NON PROFIT ASSOCIATION ESTABLISHED IN BASEL(CH) ACCORDING TO SWISS LAWS EUROMETAL OPERATIONAL OFFICES ARE BASED IN THE GRAND DUCHY OF LUXEMBOURG ADRESS: EUROMETAL OFFICE, LUXEMBOURG, 202b, RUE DE HAMM, L-1713 LUXEMBOURG PHONE: FAX: CONTACTS: GEORGES KIRPS, DIRECTOR RICARDO SILVA, OFFICE MANAGER

EUROMETAL THE VOICE OF EUROPEAN STEEL, TUBES & METALS INTERMEDIATION 4 WITH FOUR MEMBER ORGANISATIONS COVERING ALL TYPES OF DISTRIBUTION & TRADE STUDY GROUP OF DISTRIBUTORS OF STEEL, TUBES AND METALS EUROPEAN ASSOCIATION OF FLAT STEEL SERVICE CENTERS STUDY GROUP OF STEEL TRADING COMPANIES ASSOCIATION OF NATIONAL STEEL DISTRIBUTION FEDERATIONS EUROMETAL: THE VOICE OF EUROPEAN STEEL INTERMEDIATION IN 2013, EUROMETAL REPRESENTS: 70 MIO TONS OF SALES ASSOCIATED COMPANIES EMPLOYEES MORE THAN 1 MILLION CUSTOMERS

EUROMETAL THE VOICE OF EUROPEAN STEEL, TUBES & METALS INTERMEDIATION 5 STEEL INTERMEDIATIONPRODUCERSEND USERS HOME MARKET PRODUCERS & FOREIGN PRODUCERS STEEL, TUBES AND METALS END USE SECTORS STEEL, TUBE, METALS STOCKHOLDING FLAT STEEL PROCESSING STEEL & METALS TRADING WITH NAT.FED, DISMET, EASSC AND STSG EUROMETAL IS COVERING ALL MAIN OPERATIONS OF STEEL, TUBES AND METALS INTERMEDIATION EUROMETAL NETWORKS INCORPORATES ALL ASPECTS OF STEEL, TUBES & METALS INTERMEDIATION

EUROMETAL THE VOICE OF EUROPEAN STEEL TUBES & METALS DISTRIBUTION NATIONAL ASSOCIATIONS FEDERATED WITH EUROMETAL REPRESENT TODAY ABOUT EUROPEAN STEEL DISTRIBUTION ENTERPRISES SOURCE : EUROMETAL STATUS: NAT.FED MEMBER FEDERATIONS: ACOMEFER, PORTUGAL ARDIMET, ROMANIA ASSOFERMET, ITALY BDS, GERMANY FFDM, FRANCE GRYMAFER, BELGIUM MAFE, HUNGARY NASS, UK PUDS, POLAND STAALFEDERATIE, NETHERLANDS SOHM, CZECH REP. & SLOVAKIA SSHV/SVEMH, SWITZERLAND STALFORENINGEN, DENMARK STAL OCH METALL, SWEDEN STALFORENINGEN, NORWAY TEKNISEN KAUPPA, FINLAND UAHE, SPAIN WKOOE, AUSTRIA INDIVIDUAL NAT.FED MEMBERS: AMDS, LUXEMBOURG ELASTRON, GREECE GORJO, BULGARIA SIDMA, GREECE 1

EUROMETAL THE VOICE OF EUROPEAN STEEL, TUBES & METALS INTERMEDIATION 7 DISMET COVERAGE OF EUROPEAN STEEL STOCKHOLDING MARKETS SOURCE : EUROMETAL DISMET STUDY GROUP REPRESENTS MAIN EU GENERAL & PROXIMITY DISTRIBUTORS HAVING AN INTERNATIONAL MARKET COVERAGE

EUROMETAL THE VOICE OF EUROPEAN STEEL, TUBES & METALS INTERMEDIATION 8 SOURCE : EUROMETAL EASSC COVERAGE OF EUROPEAN FLAT SSC MARKETS EASSC ASSOCIATION REPRESENTS EU FLAT SSC COMPANIES HAVING AN INTERNATIONALMARKET COVERAGE

EUROMETAL THE VOICE OF EUROPEAN STEEL TUBES & METALS DISTRIBUTION 9 STSG STUDY GROUP REPRESESENTS EU STEEL TRADING COMPANIES HAVING INTERESTS IN FREE EXPORT / IMPORT STEEL TRADE SOURCE : EUROMETAL STATUS: STSG

EU STEEL DISTRIBUTION IS AN INTELLIGENT MATCHMAKER BETWEEN 200 STEEL AND TUBES PRODUCERS AND MORE THAN ONE MILLION STEEL END USERS PLEASE NOTE: WHEN PRINTING USE OPTION [ADAPT TO SIZE]

THE KEY PLAYERS IN EU STEEL SUPPLY CHAIN: 200 STEEL AND TUBES PRODUCERS, STEEL DISTRIBUTORS & SSC STEEL AND TUBES ENDUSERS EUROMETAL PRESENTATION METALEXPERT CONFERENCE STRESA APRIL EU STEEL & TUBE PRODUCERS EU STEEL & TUBE DISTRIBUTORS EU STEEL END USERS ABOUT STEEL END USERS MAX END USERS SERVED DIRECTLY BY PRODUCERS CLOSE TO END USERS SERVED BY DISTRIBUTORS

12 EUROMETAL PRESENTATION METAL EXPORT CONFERENCE STRESA APRIL SMALL ORDERS ADDITIONAL PROCESSING INCREASING COMPLEXITY SHORT LEAD TIMES SERVICE AND VALUE RAPID RESPONSE DELIVERY REQUIREMENTS FLEXIBILITY BIG VOLUMES LONG RUNS ECONOMIES OF SCALE STEEL DISTRIBUTORS ARE THE INTELLIGENT MATCHMAKERS BETWEEN STEEL PRODUCERS AND STEEL CONSUMING INDUSTRIES PARAMETERS OF STEEL PRODUCTION BUSINESS MODEL PARAMETERS OF STEEL END USER BUSINESS MODEL PRODUCT AVAILABILITY DELIVERY IN HOURS PROCESSING SERVICES LOCAL & REGIONAL FOOT PRINTS ONE STOP SHOPPING MULTI- PRODUCT MILL ORDER LEAD TIMES DELIVERY BY RAIL OR BOAT NON COMPLEX ORDERS CLUSTERING ORDERS PARAMETERS OF STEEL DISTRIBUTION – CUSTOMER SIDE PARAMETERS OF DISTRIBUTION – MILL SIDE PRODUCT SOURCING

13 EUROMETAL PRESENTATION METALEXPERT CONFERENCE STRESA CUSTOMERS VALUE CREATION STEEL AND METALS INTERMEDIATING VALUE CHAIN VALUE UNIQUE SERVICE PROPOSAL SUPPLY CHAIN MANAGEMENT TECHNICAL SUPPORT FINANCING - IT NETWORK LOGISTICS - FREIGHTING STOCKING-PROCESSING-TRANSFORMATION SOURCING - TRADING HIGH VALUE ADDED PRODUCTS COST SAVINGS IMPROVED PRODUCTIVITY EFFICIENT MARKETING AND SALES INNOVATIVE BUSINESS MODELS UNIQUE SERVICE PROPOSALS BY STEEL DISTRIBUTION HELP CUSTOMERS TO CREATE VALUE

14 EUROMETAL PRESENTATION METALEXPERT CONFERENCE STRESA APRIL PROXIMITY SUPPLY CHAIN MARKET SUPPLY CORE BUSINESS 4 EMERGING BUSINESS MODELS: TREND TREND BUSINESSMODEL LOCAL PLAYER LOCAL PLAYER REGIONAL / GLOBAL PLAYER REGIONAL / GLOBAL PLAYER MONO PRODUCT MONO SEGMENT MONO PRODUCT MONO SEGMENT MULTI PRODUCT MULTI SEGMENT MULTI PRODUCT MULTI SEGMENT BUY & SELL PROCESSING READY TO USE PROCESSING READY TO USE MARKET FOLLOWER MARKET FOLLOWER CUSTOMER DRIVEN MARKET MAKER DURING LAST 50 YEARS, EU STEEL DISTRIBUTION HAS BEEN IN A CONTINOUS PROCESS OF ADAPTING BUSINESS MODELS TO CHANGING MARKET ENVIRONMENTS

15 EUROMETAL PRESENTATION METALEXPERT CONFERENCE STRESA APRIL BUSINESS MODELS OF STEEL DISTRIBUTION ARE FOLLOWING THE CHANGING AND DIFFERENTIATED MARKET FUNCTIONALITIES… …LEADING TO A RATHER LARGE SCOPE OF OPERATIONAL MODES IN STEEL DISTRIBUTION MARKET FUNCTIONALITIES AFFECT STEEL DISTRIBUTION BUSINESS MODELS IN LOCAL, REGIONAL AND INTERNATIONAL STEEL MARKETS PROXIMITY BUSINESS FOCUSED ON SERVING LOCAL / REGIONAL MARKETS MARKET SUPPLY BUSINESS FOCUSED ON LARGE MATERIAL SOURCING FOR SME STOCKISTS SUPPLY CHAIN BUSINESS FOCUSED ON INTEGRATING INTO VALUE ADDED NETWORKS CORE COMPETENCE BUSINESS PRODUCT SPECIALIST / SERVICE SPECIALIST ACTING IN NICHE MARKETS

16 EUROMETAL PRESENTATION METALEXPERT CONFERENCE STRESA APRIL BEAM & PROFILE CENTERS & GENERAL STOCKIST PLATE PROCESSOR & STOCKIST HIGH CARBON & ALLOY STEELS STOCKIST STRIP MILL PRODUCTS SERVICE CENTER STAINLESS STEEL SERVICE CENTER REINFORCING STEEL CENTERS DISTRIBUTION OF TUBULAR PRODUCTS TYPICAL STEEL STOCKHOLDING FLAT STEEL SERVICE CENTERS BASED ON PRODUCT AND SERVICE OFFER, EU STEEL DISTRIBUTION IS RUNNING DIFFERENT TYPICAL OPERATIONAL MODELS ADAPTED TO SPECIFIC SUPPLY CHAIN REQUIREMENTS OF EACH END USE SECTOR

EU STEEL DISTRIBUTION & STEEL SSC ARE SYSTEMIC FOR SUPPLY CHAINS TO STEEL END USERS PLEASE NOTE: WHEN PRINTING USE OPTION [ADAPT TO SIZE]

18 EUROMETAL PRESENTATION METALEXPERT CONFERENCE STRESA APRIL 2014 THE TYPICAL STEEL PRODUCT PORTFOLIO TRADED BY STEEL DISTRIBUTION REPRESENTS 87 % OF THE VOLUMES 0F ALL PRODUCTS OFFERED IN EU STEEL MARKET BEAMS MERCHANT BARS REBARS PLATES STRIP MILL PRODUCTS STAINLESS OTHER ALLOY STEELS 86 % = 113 MT EU MARKET SUPPLY IN CONSIDERED PRODUCTS : 131 MT IN 2013 EU MARKET: ALL FINISHED STEEL PRODUCTS OFFERED BY STEEL MILLS WIRE ROD RAILS SHEET PILES 14 % = 18 MT STEEL PRODUCTS TRADED BY EU STEEL DISTRIBUTION AS WELL AS BY MILLS ONLY BY MILLS

19 EUROMETAL PRESENTATION METALEXPERT CONFERENCE STRESA APRIL EU MILLS 87 % DIRECT DELIVERIES MILL TO END USER 62 % 38 % SUPPLY SIDEINTERMEDIATION DEMAND SIDE ALL STEEL PRODUCTS CONSIDERED, STEEL DISTRIBUTION INTERMEDIATES TODAY 62 % OF EU-27 STEEL MARKET SUPPLY, NON EU MILLS 13 % EU STEEL DISTRIBUTION STEEL DEMAND BY END USER SEGMENTS IN EU STEEL MARKETS 62 % 38 % SOURCE: EUROMETAL, DATA ESTIMATED FOR 2013

20 EUROMETAL PRESENTATION METALEXPERT CONFERENCE STRESA APRIL 2014 IN 2013, STEEL DISTRIBUTION ACCOUNTED FOR 62% OF ROUTES TO THE MARKET: CONSIDERING ALL STEEL PRODUCTS, THERE WERE NO REALLY SIGNIFICANT CHANGES IN MARKET SHARE OF THE THREE MAIN SUPPLY ROUTES 39 % 37 % % 38 % 23 % 40 %39 %SHARE IN EU ROUTES TO MARKET ALL STEEL PRODUCTS DIRDIRECT MILL DIRFLAT SSC DIR STEEL STOCKHOLDERS 24 % E % 24 % 38 %

21 EUROMETAL PRESENTATION METALEXPERT CONFERENCE STRESA APRIL 2014 FLAT SSC E2013 ROUTES TO MARKET: STOCKHOLDING DISTRIBUTION MILLS MARKET SHARE 0 % 50 % 100 % RAI LS MERCHANT BARS BEAMS REBARS STRIP MILL PRODUCTS PLATES TUB ES * EXCL. PRE-MATERIAL FOR COLD REROLLING & TUBES, RAILS, SHEET PILING, WIRE RODS TUBES FLAT SSC EU STEEL DISTRIBUTION IS A SYSTEMIC PLAYER IN MARKET SUPPLY FOR ALL STEEL PRODUCT S, EXCEPT FOR WIRE ROD, RAILS, SHEET PILINGS SOURCE: EUROMETAL UPDATED STAINLESS OTHER ALLOY STEELS

22 EUROMETAL PRESENTATION METALEXPERT CONFERENCE STRESA APRIL ROUTES TO MARKET: EU STEEL DISTRIBUTION & TRADERS DIRECT MILL BUSINESS MARKET SHARE 0 % 50 % 100 % RAI LS CONSTRUCTION SECTOR STRIP MILL PRODUCTS * INCL PRE-MATERIAL FOR COLD REROLLING & TUBES, BY END USE SECTORS, STEEL DISTRIBUTION IS A SYSTEMIC PLAYER FOR CONSTRUCTION & MECH. ENGINEERING SECTORS. FOR AUTOMOTIVE, SSC ARE SYSTEMIC ADDED VALUE PROVIDERS SOURCE: EUROMETAL UPDATED STAINLESS AUTOMOTIVE SECTOR MECH. ENGINEE RING OTHER END USE SECTORS 67 % 33% 89 % 69 % ALL SECTORS 68 % 38% 62 % 31 % 11 % 63 % 33 %

AFTER A SLIGHT SLUMP IN 2013, STEEL DISTRIBUTION SALES RECOVERED A ROBUST GROWTH PACE IN THE 1.QUARTER OF 2014 PLEASE NOTE: WHEN PRINTING USE OPTION [ADAPT TO SIZE]

DISMET MARKET MONITORING MARCH IN FIRST 3 MONTHS 2014, DISMET SALES NOTED A GROWTH OF + 7 %, Y-O-Y. SOURCE : EUROMETAL SOURCE: EUROMETAL UPDATE: DEVELOPMENT OF DISMET VOLUME SALES: Y-0-Y COMPARISON LONG STEEL PRODUCTS 2013 J-M 14 -3% +8% PLATES 2013 J-M 14 -3% + 8% STRIP MILL PRODUCTS 2013 J-M 14 -7% +7% STAINLESSTUBULAR PRODUCTS ALL STEEL PRODUCTS 2013 J-M % +6% +9% +11% - 4 % +7%