Slide sem ttulo

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May 2003
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Disclaimer
This presentation may contain statements that
express managements expectations about future
events or results rather than historical facts.
These forward-looking statements involve risks
and uncertainties that could cause actual results
to differ materially from those projected in
forward-looking statements, and CVRD cannot give
assurance that such statements will prove
correct. These risks and uncertainties include
factors relating to the Brazilian economy and
securities markets, which exhibit volatility and
can be adversely affected by developments in
other countries relating to the iron ore
business and its dependence on the global steel
industry, which is cyclical in nature and
relating to the highly competitive industries in
which CVRD operates. For additional information
on factors that could cause CVRDs actual results
to differ from expectations reflected in
forward-looking statements, please see CVRDs
reports filed with the Brazilian Comissão de
Valores Mobiliários and the U.S. Securities and
Exchange Commission.
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Contents

• Corporate Highlights
• 1Q03 Results
• Short Term Outlook
• Creating Value in an Age of Uncertainty
• Investment Appeal

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Corporate Highlights
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One of the largest companies in the global mining
and metals industry.
Market Capitalization - in US billion as of
April 30, 2003
Source Bloomberg
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The largest diversified mining company of the
Americas.
Iron Ore and Pellets
Railroads and Ports
Aluminum Bauxite, Alumina and Aluminum
Manganese and Ferro-alloys
Steel
Copper, Gold and Nickel
Industrial Minerals Kaolin and Potash
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Leveraged to the global economy
Gross Operating Revenues 1Q03 US 1,153 million
By Market
By Currency
Up to 89 of revenues and less than 30 of costs
are USD-linked
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A leading role in the consolidation of the global
iron ore industry.
Seaborne trade 1999 410 million tons
Seaborne trade 2002 480 million tons
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1Q03 Results
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Quarterly earnings volatility influenced by
currency volatility.
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A new methodology to estimate EBITDA figures.
US million
1Q02 2Q02 3Q02 4Q02 1Q03
Operating income 295 334 459 341 363 Depreciation,
Amortization and Depletion 66 61 44 43 43 Dividen
ds Received 25 30 17 19 36 Asset
Impairment 11 - - 35 - Adjustment for
non-recurring items - - - - - EBITDA - New
methodology 397 425 471 438 442 EBITDA -
Previous methodology 444 456 483 406 -
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Iron ore and pellet shipments constrained by
mining and logistics capacity.
million tons
44.0
42.3
42.5
41.1
38.3
38.0
38.0
36.7
34.4
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Asset integration, new services and contracts to
manage clients logistics are boosting CVRD sales
growth.
CVRD Railroads - General Cargo Transportation
million ntk
6,137
5,908
5,856
5,669
5,622
5,505
5,207
5,233
4,961
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Railroad productivity is improving and
reliability is the best in the world.
Vitória a Minas Railroadmillion ntk per active
loco per day
Carajás RailroadWorld record in MKBF - mean
kilometers between failure - 10 million km
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Short Term Outlook
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A challenging business environment

• China is the sunspot in a gloomy world economy
  and it is where demand for iron ore exploded.
• SARS is likely to cause slower GDP growth in
  2Q03/3Q03. However, we do not expect the Chinese
  economy to stall.
• Up to now there are no signs of deceleration in
  iron ore demand growth.

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CVRD and the Brazilian Real (BRL).

• The appreciation of the BRL has a limited
  negative impact on CVRD USD cash flow. Iron
  prices have a more powerful effect.
• In the current environment the flipside of a
  stronger BRL is a lower capital cost.

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Freight behavior signals a global excess demand
for iron ore.
Brazil-Japan and Australia-Japan freight rates
differential.
iron ore price increase
2-digit iron ore price increase
iron ore price increase
2-digit iron ore price decrease
Source Clarksons
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Iron ore prospects

• We estimate global seaborne demand for iron ore
  to be 510 million tons in 2003. It is unlikely to
  be met by suppliers.
• We believe that the iron ore shortage will remain
  throughout 2003/2004.

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Iron ore prospects

• We expect a modest increase in CVRD shipments in
  2003/2004 due to capacity constraints in mining
  and logistics.
• Purchases of iron ore from third parties will
  continue and are likely to peak in 2004.
• Iron ore purchases are needed to meet
  commitments. They put pressure on margins but
  contribute to marginal increases in ROIC.
• Purchases play the role of a swing producer.

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Iron ore prospects

• We are investing in additional mining capacity
  and elimination of logistics bottlenecks.
• Mining projects
• Southern System - Fabrica Nova, Brucutu.
• Northern System - Carajás N5.
• Logistics projects
• Ponta da Madeira maritime terminal - Pier III.
• Tubarão Port.

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Alumina prices surged and Alunorte stage 3 is
allowing CVRD to benefit from the new price
scenario.
Source CRU
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There is excess supply of aluminum and large
inventories. However, high alumina prices and
power shortages are likely to constrain supply
and to mitigate downward price pressure.
Aluminum Market Surplus or (Deficit)
Sources CRU - January 2003
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Logistics services

• An all time high grain crop and new contracts
  brighten the short term outlook.
• The acquisition of new locos and wagons will
  allow us to realize market opportunities.

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Creating Value in an Age of Uncertainly Projec
ts and Strategic Movements
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Profitable growth is the strongest driver of
shareholder returns. And organic rather than
acquisition growth is the most important
component.
Greenfield projects
Mineral exploration
Acquisitions
Brownfield projects
However, to seize good opportunities for
acquisition growth is also valuable.
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Mineral Exploration
A multicommodity and multiregional program
2003 Capex by Commodity
2003 Capex by Region
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A value creating project pipeline Capital
expenditures of approximately US 6 billion in
organic growth.
Greenfield
Santa Izabel
Estreito
Capim Branco II
Paragominas
Capim Branco I
Foz do Chapecó
Salobo
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Aimorés
Sossego
Brucutu
Alemão
Candonga
Metallics
Fabrica Nova
Semi-finished
2003
2004
2005
2006
2007
Locomotives and Wagons
Locomotives and Wagons
Taquari Vassouras
Reference US 100 M
Alunorte Stages 4 and 5
Praia Mole Phase1
Grain Silos
Alunorte Stage 3
Praia Mole Phase2
Carajas Mines
Gongo Soco and Itabira
MRN
Brownfield
Pta da Madeira Pier III
Expected after taxes rates of return higher than
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Superior asset productivity is vital to achieve
profitable growth. CAPEX cost of CVRD projects
are among the lowest in the world.
Estimated Product Capacity Conclusion
CAPEX Projects 1,000 tons/year US/ton
Iron Ore Brucutu
12,000 2008 16.18 Fabrica Nova
15,000 2009 6.39 Carajas
14,000 2005 8.61 Gongo Soco /
Itabira 3,000 2004 7.02 Bauxite Paragominas
I 4,500 2005 48.89 Alumina Alunorte Stages 4 and
5 1,800 2005 363.56 Copper Sossego 140 2004 2,447
.00 Potash Taquari Vassouras 250 2005 191.43 Powe
r Candonga 140 MW 2003 572.14 Aimorés 330
MW 2003 561.82
Greenfield Brownfield
US / Kw
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Debottlenecking iron ore logistics
Ponta da Madeira maritime terminal - Pier III is
scheduled to start up in 1Q04.
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Fabrica Nova - A greenfield brownfield iron ore
project.
Product composition lump ore 15 sinter
feed 55 pellet feed 30 Capex US 85
million 10 million tpy 2005 Capacity 15
million tpy 2009
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Sossego - The first CVRD copper project.
Capex US 383 million _at_ 1.0 Cu and
0.29 g/t Au Estimated production Copper
concentrate 469,000 tpy Copper 140,000
tpy Start-up mid 2004
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Non-iron ore projects will generate a more
diversified though focused company profile.
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CAEMI one of the best deals in the mining
industry.

• Price paid, US 426.4 million, equal to 5.0x 2002
  EBITDA.
• CVRD share in iron ore seaborne market increases
  to 34.
• CAEMI will be fully consolidated into CVRDs US
  GAAP financial statements.
• CAEMI, has a good penetration in the Chinese
  market - 9.7 market share.
• Acquisition allows Ferteco consolidation into
  CVRD and the exploitation of substantial
  synergies between the two companies.

The acquisition is subject to the review and
approval of competition authorities
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CAEMI acquisition enhancing CVRD global
leadership in seaborne iron ore trade.
Pre-acquisition
Post-acquisition
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Acquisition of Elkem Rana, now Rio Doce Manganese
Norway (RDMN).

• Price paid US 17.6 million (minus net cash
  position of US 7 million)
• Investment required US 2 million
• RDMN will have a ferro manganese alloy capacity
  of 110,000 tons/year (current CVRD capacity
  450,000 tons/year)

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Joint venture with NUCOR to construct and operate
a pig iron project - aiming to deepen penetration
into the US market.

• Production capacity of 380,000 metric tons/year
  of pig iron .
• The charcoal source will be exclusively from
  eucalyptus trees grown in a cultivated forest
  (currently owned by CVRD).
• Investment required US 80 million.
• The ownership will be split 78 CVRD and 22
  NUCOR.

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A temporary increase of CVRD stake in CST - from
22.85 to 28.02.

• Price paid US 59.7 million.
• Benefits
• Adds liquidity to CVRD stake.
• Construction of CST third blast furnace will
  generate substantial increase in CVRD iron ore
  sales from 2006 onwards.

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Investment appeal
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CVRD has been a consistent value adder.
ROIC / WACC
Value Destruction
Value Creation
0
0.5
1.0
1.5
2.0
2.5
3.0
According to CRU, 84 of shareholder return
differences across mining and metals companies
can be explained by differences in ROIC.
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Simultaneously, CVRD distributed sizable
dividends.
Dividend Yield ()
Dividend per share US
minimum announced on January 30, 2003
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Investment appeal

• A clearly defined long term strategy.
• Good strategy execution customer focus, cost and
  investment discipline, conservative financial
  policy, focus on shareholder value creation.
• Global market leadership in iron ore - stability
  with high profitability.
• World class mining assets capable of earning
  above average market returns.
• A pipeline of profitable growth opportunities.
• Strong and stable cash flow allows us to meet
  dividend expectations and capex funding without
  concerns about short term cash disruptions.
• Last but not least, CVRD is traded at a discount
  to its peers.

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CVRD - The Best of Brazil
www.cvrd.com.br e-mail rio_at_cvrd.com.br