Steel Mills

Sales Up 2% at Ternium

April 30, 2014

Latin American steelmaker, Ternium, turned in a positive quarter with net sales up 2 percent to $2.149 from fourth quarter and 1 percent from Q1 2013. Net income was $188.2 million compared to $174.7 in the fourth quarter, and $164 million in Q1 2013.

Ternium net steel sales increased 1% to $2,149.4 million. Operating income increased to $319 million, an increase of 8 percent sequentially and 13 percent y/y, as a result of improved steel shipments and operating margins, partially offset by lower revenue per ton. Lower raw material costs were partially offset by lower steel prices in the Southern Region.

Ternium expects improved shipment levels in Mexico during the second quarter. The ramp up of the new Pesqueria facility is progressing as planned and Tenigal is advancing in its certification process with Mexican auto makers.

Shipments in the Southern region were lower due to seasonal demand. Uncertainty in Argentina’s macroeconomic environment may affect steel consumption in the coming quarters. Steel prices in Argentina were down from first quarter and are expected to be unchanged in Q2.

Higher raw material and purchased slabs costs are expected to offset increases in shipments in the second quarter reducing operating income slightly.