LUXEMBOURG, LU / ACCESS Newswire / April 29, 2025 / Ternium S.A. (NYSE:TX) today announced its results for the first quarter ended March 31, 2025.

The financial and operational information contained in this press release is based on Ternium S.A.'s operational data and consolidated condensed interim financial statements prepared in accordance with IAS 34 "Interim financial reporting" (IFRS) and presented in U.S. dollars ($) and metric tons. Interim financial figures are unaudited. This press release includes certain non-IFRS alternative performance measures such as Adjusted EBITDA, Cash Operating Income, Adjusted Net Income, Adjusted Equity Holders' Net Income, Adjusted Earnings per ADS, Free Cash Flow and Net Cash. The reconciliation of these figures to the most directly comparable IFRS measures is included in Exhibit I.

First Quarter of 2025 Highlights

Summary of First Quarter of 2025 Results

First Quarter of 2025 Highlights

In the first quarter of 2025, Ternium reported a sequential increase in adjusted EBITDA driven by improved margins and steel and iron ore shipments. Cost per ton decreased due to the gradual consumption of lower-priced slabs and raw material inventories as well as to improvements in industrial operations efficiency, while a sequentially lower revenue per ton partially offset this cost reduction.

Ternium's sales volume in Mexico decreased both sequentially and year-over-year in the first quarter of 2025. Uncertainty surrounding evolving U.S. trade policies continued to weight on shipments in the first quarter, primarily in the commercial steel market. However, the company's sales to industrial customers remained relatively stable.

Shipments in the Brazilian steel market rose sequentially in the first quarter, rebounding from the seasonal slowdown in the fourth quarter. Year-over-year, sales volumes in Brazil grew by 9%, reflecting the successful ramp-up of Usiminas' main blast furnace and increased domestic demand for steel products.

In the Southern Region, steel sales volumes remained relatively stable in the first quarter of 2025 compared to the fourth quarter of 2024. Year-over-year, the company reported a 32% rise in steel shipments during the first quarter, reflecting better activity in the Argentine steel market after a notably weak performance in the same period of 2024.

In Other Markets, steel shipments rose by 36% sequentially in the first quarter partly as a result of the sale of steel slabs to third parties. Year-over-year, steel shipments declined by 14% in the first quarter of 2025, primarily due to lower sales volume in the U.S. market.

Story Continues

Net income of $142 million in the first quarter of 2025 included a provision adjustment charge of $45 million in connection with the ongoing litigation related to the acquisition of a participation in Usiminas. This adjustment accounted for interest accrual and the appreciation of the Brazilian Real versus the U.S. dollar in the quarter. Excluding this charge, Adjusted Net Income amounted to $188 million.

Ternium reported a Net Cash position of $1.3 billion at the end of March 2025, down from $1.6 billion at the end of 2024. Cash provided by operations amounted to $207 million in the first quarter and capital expenditures were $518 million, mainly in connection with the ongoing expansion at the company's industrial center in Pesquería, Mexico.

Following a review of the project, the company estimates the total cost of its expansion plan in Pesquería to reach $4.0 billion, a 16% increase from a prior estimate in February 2024, primarily due to higher prices for assembly and construction, larger volumes of structures and civil works, as well as higher costs associated with extended deadlines. Ternium now expects the new steel slab mill in Pesquería will begin operations by the fourth quarter of 2026.

Outlook

Ternium expects a sequential increase in adjusted EBITDA in the second quarter of 2025, driven mainly by higher realized steel prices and slightly lower cost per ton, with relatively stable steel shipments.

In Mexico, the company anticipates volumes in the second quarter to remain subdued due to the unresolved tariff issue, which impacts operational and investment decisions in the steel value chain.

In Brazil, Usiminas anticipates sequentially stable steel shipments in the second quarter of 2025, amid resilient steel demand. The issue of unfair trade practices remains unresolved in this market, with notable year-over-year increases in imports during the first quarter of 2025.

In Argentina, the company expects a sequential increase in shipments in the second quarter of 2025 due to improvements in macroeconomic conditions.

Analysis of First Quarter of 2025 Results

Consolidated Net Sales

Adjusted EBITDA

Adjusted EBITDA in the first quarter of 2025 equals Net Income adjusted to exclude:

Depreciation and amortization; Income tax results; Net financial result; Equity in earnings of non-consolidated companies; and Provision charge for ongoing litigation related to the acquisition of a participation in Usiminas.

And adjusted to include the proportional EBITDA in Unigal (70% participation).

Adjusted EBITDA Margin equals Adjusted EBITDA divided by net sales. For more information see Exhibit I - Alternative performance measures - "Adjusted EBITDA".

Steel Segment

In the first quarter of 2025, the Steel Segment's shipments and net sales rose slightly compared to the fourth quarter of 2024. Increased sales volumes in Brazil and Other Markets were partially offset by lower sales volumes in Mexico. Realized steel prices edged down slightly on a sequential basis.

Year-over-year, shipments in the Steel Segment remained relatively stable, while net sales declined by 19% in the first quarter of 2025. Lower sales volumes in Mexico and Other Markets were largely offset by higher shipments in Brazil and the Southern Region. Steel revenue per ton fell across all regions due to lower steel prices.

In Mexico, steel shipments had a sequential decline in the first quarter of 2025, reflecting a weaker commercial market. In the case of the industrial market, demand from industrial customers remained relatively stable. Year-over-year, shipments declined in the period, mainly due to a soft commercial market and a slight decrease in sales to industrial customers.

In Brazil, shipments rose sequentially during the first quarter reflecting higher demand for steel products after a seasonally low fourth quarter. Year-over-year, sales volumes increased in the first quarter reflecting the successful ramp up of Usiminas' main blast furnace and a stronger demand for steel products in the country.

In the Southern Region, steel shipments remained relatively stable sequentially in the first quarter. Year-over-year, sales volumes showed a significant rebound in this period, reflecting better activity in the Argentine steel market after a notably weak performance in the same period of 2024.

In Other Markets, sales volumes rose sequentially in the first quarter partly as a result of the sale of steel slabs to third parties. On a year-over-year basis, shipments decreased in the period, largely reflecting lower sales volumes in the U.S. market.

The Steel Segment's Cash Operating Income showed a sequential increase in the first quarter of 2025, driven by higher sales volumes and margins. There was a sequential decrease in raw material and purchased slab costs that were partially offset by lower realized steel prices.

Year-over-year, the decrease in the Steel Segment's Cash Operating Income in the first quarter of 2025 was driven mainly by lower margins. In the period, a $217 revenue per ton reduction was partially offset by a decrease in raw material and purchased slab costs.

Note: For a reconciliation of the Steel Segment's Cash Operating Income and Cash Operating Income per Ton and Margin to the most directly comparable IFRS measures, see Exhibit I - Alternative performance measures - "Cash Operating Income - Steel Segment".

Mining Segment

The Mining Segment's net sales increased sequentially by 13% in the first quarter of 2025, reflecting higher realized iron ore prices and a slight increase in shipments. Year-over-year, the Mining Segment's net sales rose by 2% in the first quarter of 2025, with an increase in shipments supported by higher production levels in Mexico and Brazil. This was mostly offset by a decrease in revenue per ton, reflecting the year-over-year decline in iron ore prices.

In the first quarter of 2025, the Mining Segment's Cash Operating Income decreased sequentially and on a year-over-year basis as a result of lower margins, partially offset by higher sales volumes. Compared to the fourth quarter of 2024, the decrease in margins in the first quarter of 2025 resulted from higher cost per ton, partially offset by higher realized iron ore prices.

Year-over-year, margins contracted due to lower realized iron ore prices, partially offset by a moderate decline in cost per ton.

Note: For a reconciliation of the Mining Segment's Cash Operating Income and Cash Operating Income per Ton and Margin to the most directly comparable IFRS measures, see Exhibit I - Alternative performance measures - "Cash Operating Income - Mining Segment".

Net Financial Results

Net financial results for the first quarter of 2025 recorded a $63 million gain. The net foreign exchange result for the period was a $31 million gain, driven mainly by the Brazilian Real's appreciation against the U.S. dollar. This had a favorable effect on Usiminas' U.S. dollar-denominated financial debt, as its functional currency is the Brazilian Real, as well as on

Ternium Brazil's long local currency position. In addition, Ternium Argentina's divestment of Argentine government bond holdings resulted in a gain of $30 million in the period, due to the recycling of changes in the fair value of financial instruments from Other Comprehensive Income to Financial Results.

$ MILLION   1Q25    4Q24    1Q24   Net interest results   14    18    38  Net foreign exchange result   31    (72 )   (41 ) Change in fair value of financial assets   29    (3 )   (137 ) Other financial expense, net   (11 )   (11 )   (22 ) Net financial results   63    (67 )   (163 )

Income Tax Results

Ternium Mexico, Ternium Argentina and Ternium Brasil use the U.S. dollar as their functional currency and are, therefore, affected by deferred tax results.

These results account for the impact of local currency fluctuations against the U.S. dollar, as well as for the effect of local inflation.

$ MILLION   1Q25    4Q24    1Q24   Current income tax expense   (25 )   (10 )   (126 ) Deferred tax gain (loss)   3    (54 )   86  Income tax expense   (23 )   (64 )   (40 ) Result before income tax   165    397    532  Effective tax rate   14 %   16 %   8 %

Net Income

In the first quarter of 2025, Ternium recorded net income of $142 million, which included a provision

adjustment charge of $45 million for ongoing litigation related to the acquisition of a participation in Usiminas. This adjustment accounted for interest accrual and the appreciation of the Brazilian Real versus the U.S. dollar in the quarter. Excluding this, Adjusted Net Income amounted to $188 million, on operating income of $132 million and a financial result gain of $63 million.

Adjusted Equity Holder's Net Income was $108 million in the first quarter, or $55 cents per ADS, mainly after accounting for the participation of a 76.7% non-controlling interest in Usiminas and a 37.4% non-controlling interest in Ternium Argentina.

$ MILLION   1Q25    4Q24    1Q24   Owners of the parent   67    281    361  Non-controlling interest   75    52    130  Net Income   142    333    491   Excluding provision charge (reversal) for ongoing litigation related to the acquisition of a participation in Usiminas in 2012   45    (404 )   -  Adjusted Net Income (Loss)   188    (71 )   491

$ per ADS   1Q25    4Q24    1Q24  Earnings per ADS   0.34    1.43    1.84  Adjusted Earnings (Losses) per ADS   0.55    (0.42 )   1.84

Cash Flow and Liquidity

In the first quarter of 2025, cash from operations amounted to $207 million after a $55 million increase in working capital. Trade and other receivables rose by a net $205 million during the period, driven by higher sales. In addition, trade payables and other liabilities declined by $98 million in the first quarter.

On the other hand, inventories decreased by $249 million due to lower costs and volumes.

Capital expenditures totaled $518 million in the first quarter, primarily reflecting the progress made in the construction of the new facilities at Ternium's industrial center in Pesquería, Mexico.

Ternium's Net Cash position declined by $358 million during the first quarter of 2025, reaching $1.3 billion at the end of March 2025, primarily due to cash outflows related to its capital expenditure program.

Conference Call and Webcast

Ternium will host a conference call on April 30, 2025, at 8:30 a.m. ET in which management will discuss first quarter of 2025 results. A webcast link will be available in the Investor Center section of the company's website at www.ternium.com.

Forward Looking Statements

Some of the statements contained in this press release are "forward-looking statements". Forward-looking statements are based on management's current views and assumptions and involve known and unknown risks that could cause actual results, performance or events to differ materially from those expressed or implied by those statements. These risks include but are not limited to risks arising from uncertainties as to gross domestic product, related market demand, global production capacity, tariffs, cyclicality in the industries that purchase steel products, and other factors beyond Ternium's control.

About Ternium

Ternium is a leading steel producer in the Americas, providing advanced steel products to a wide range of manufacturing industries and the construction sector. We invest in low carbon emissions steelmaking technologies to support the energy transition and the mobility of the future. We also support the development of our communities, especially through educational programs in Latin America. More information about Ternium is available at www.ternium.com.

Income Statement

$ MILLION   1Q25    4Q24    1Q24   Net sales   3,933    3,876    4,778  Cost of sales   (3,402 )   (3,426 )   (3,675 ) Gross profit   531    450    1,104  Selling, general and administrative expenses   (396 )   (373 )   (431 ) Other operating (expense) income, net   (3 )   (35 )   2  Operating income   132    42    675   Financial expense   (54 )   (52 )   (45 ) Financial income   68    71    83  Other financial income (expense), net   49    (86 )   (200 ) Equity in earnings of non-consolidated companies   16    18    20  Provision (charge) reversal for ongoing litigation related to the acquisition of a participation in Usiminas   (45 )   404    -  Profit before income tax results   165    397    532  Income tax expense   (23 )   (64 )   (40 ) Profit for the period   142    333    491   Attributable to:  Owners of the parent   67    281    361  Non-controlling interest   75    52    130  Profit for the period   142    333    491

Statement of Financial Position

$ MILLION  MARCH 31, 2025   DECEMBER 31, 2024   Property, plant and equipment, net   8,803    8,381  Intangible assets, net   1,019    1,022  Investments in non-consolidated companies   509    469  Other investments       23  Deferred tax assets   1,298    1,194  Receivables, net   1,030    961  Total non-current assets   12,660    12,050   Receivables, net   882    902  Derivative financial instruments   8    4  Inventories, net   4,591    4,751  Trade receivables, net   1,812    1,562  Other investments   1,924    2,160  Cash and cash equivalents   1,831    1,691  Total current assets   11,048    11,071   Non-current assets classified as held for sale   8    7   Total assets   23,716    23,129

Statement of Financial Position (cont.)

$ MILLION  MARCH 31, 2025   DECEMBER 31, 2024   Capital and reserves attributable to the owners of the parent   12,108    11,968  Non-controlling interest   4,429    4,163  Total equity   16,537    16,132   Provisions   592    553  Deferred tax liabilities   95    89  Non current tax liabilities   25    21  Other liabilities   783    766  Trade payables   1    5  Lease liabilities   171    164  Borrowings   1,829    1,560  Total non-current liabilities   3,496    3,158   Provision for ongoing litigation related to the acquisition of a participation in Usiminas   455    410  Current income tax liabilities   33    107  Other liabilities   670    630  Trade payables   1,836    1,926  Derivative financial instruments   1    50  Lease liabilities   47    46  Borrowings   641    670  Total current liabilities   3,683    3,839   Total liabilities   7,179    6,997   Total equity and liabilities   23,716    23,129

Statement of Cash Flows

$ MILLION   1Q25    4Q24    1Q24   Result for the period   142    333    491   Adjustments for:  Depreciation and amortization   184    189    171  Income tax accruals less payments   (50 )   23    (13 ) Equity in earnings of non-consolidated companies   (16 )   (18 )   (20 ) Provision charge (reversal) for ongoing litigation related to the acquisition of a participation in Usiminas   45    (404 )   -  Interest accruals less payments / receipts, net   9    (7 )   (2 ) Changes in provisions   3    10    (7 ) Changes in working capital   (55 )   257    (266 ) Net foreign exchange results and others   (56 )   56    120  Impairment of Las Encinas' mining assets   -    32    -  Net cash provided by operating activities   207    472    475   Capital expenditures and advances to suppliers for PP&E   (518 )   (561 )   (449 ) Decrease (increase) in other investments   243    296  Proceeds from the sale of property, plant & equipment   1    1    1  Dividends received from non-consolidated companies   1    21    1  Net cash used in investing activities   (273 )   (243 )   (447 )  Dividends paid in cash to company's shareholders   -    (177 )   -  Dividends paid in cash to non-controlling interest   -    (5 )   -  Finance lease payments   (20 )   (15 )   (18 ) Proceeds from borrowings   573    272    131  Repayments of borrowings   (385 )   (139 )   (166 ) Net cash provided by (used in) financing activities   167    (63 )   (53 )  Increase (decrease) in cash and cash equivalents   101    165    (24 )

Exhibit I - Alternative Performance Measures

These non-IFRS measures should not be considered in isolation of, or as a substitute for, measures of performance prepared in accordance with IFRS. These non-IFRS measures do not have a standardized meaning under IFRS and, therefore, may not correspond to similar non-IFRS financial measures reported by other companies.

Adjusted EBITDA

$ MILLION   1Q25    4Q24    1Q24   Net income   142    333    491  Adjusted to exclude:  Depreciation and amortization   184    189    171  Income tax results   23    64    40  Net financial results   (63 )   67    163  Equity in earnings of non-consolidated companies   (16 )   (18 )   (20 ) Provision charge (reversal) for ongoing litigation related to the acquisition of a participation in Usiminas   45    (404 )   -  Impairment of Las Encinas' mining assets   -    32    -  Adjusted to include:  Proportional EBITDA in Unigal (70% participation)   6    6    9  Adjusted EBITDA   322    270    855  Divided by: net sales   3,933    3,876    4,778  Adjusted EBITDA Margin (%)   8 %   7 %   18 %

Exhibit I - Alternative Performance Measures (cont.)

Cash Operating Income - Steel Segment

$ MILLION   1Q25    4Q24    1Q24   Operating Income - Management View (Note "Segment Information" to Ternium's Financial Statements as of the corresponding dates)   244    308    593  Plus/Minus differences in cost of sales (IFRS)   (116 )   (259 )   59  Excluding depreciation and amortization   142    142    137  Including proportional EBITDA in Unigal (70% participation)   6    6    9  Cash Operating Income   276    197    798  Divided by: steel shipments (thousand tons)   3,857    3,764    3,894  Cash Operating Income per Ton - Steel   72    52    205  Divided by: steel net sales   3,801    3,767    4,690  Cash Operating Income Margin - Steel (%)   7 %   5 %   17 %

Cash Operating Income - Mining Segment

$ MILLION   1Q25    4Q24    1Q24   Operating Result - Management View (Note "Segment Information" to Ternium's Financial Statements as of the corresponding dates)   (2 )   (35 )   (22 ) Plus/minus differences in cost of sales (IFRS)   17    15    54  Excluding depreciation and amortization   42    47    34  Impairment of Las Encinas' mining assets   -    32    -  Cash Operating Income   57    60    66  Divided by: mining shipments (thousand tons)   3,059    2,995    2,695  Cash Operating Income per Ton - Mining   18    20    25  Divided by: mining net sales   280    249    274  Cash Operating Income Margin - Mining (%)   20 %   24 %   24 %

Exhibit I - Alternative Performance Measures (cont.)

Adjusted Net Income

$ MILLION   1Q25    4Q24    1Q24   Net income   142    333    491  Excluding provision charge (reversal) for ongoing litigation related to the acquisition of a participation in Usiminas   45    (404 )   -  Adjusted Net Income (Loss)   188    (71 )   491

Adjusted Equity Holders' Net Income and Adjusted Earnings per ADS

$ MILLION   1Q25    4Q24    1Q24   Equity holders' net income   67    281    361  Excluding provision charge (reversal) for ongoing litigation related to the acquisition of a participation in Usiminas   41    (364 )   -  Adjusted Equity Holders' Net Income (Loss)   108    (83 )   361  Divided by: outstanding shares of common stock, net of treasury shares (expressed in million of ADS equivalent)   196    196    196  Adjusted Earnings (Losses) per ADS ($)   0.55    (0.42 )   1.84

Free Cash Flow

$ MILLION   1Q25    4Q24    1Q24   Net cash provided by operating activities   207    472    475  Excluding capital expenditures and advances to suppliers for PP&E   (518 )   (561 )   (449 ) Free Cash Flow   (311 )   (90 )   26

Exhibit I - Alternative Performance Measures (cont.)

Net Cash

$ BILLION  MARCH 31, 2025   DECEMBER 31, 2024   MARCH 31, 2024   Cash and cash equivalents   1.8    1.7    1.8  Plus: other investments (current and non-current)   1.9    2.2    2.3  Less: borrowings (current and non-current)   (2.5 )   (2.2 )   (2.1 ) Net Cash   1.3    1.6    2.0

Note: Ternium Argentina's consolidated position of cash and cash equivalents and other investments amounted to $1.1 billion as of March 31, 2025, $1.3 billion as of December 31, 2024 and $1.2 billion as of March 31, 2024.

Sebastián Martí
Ternium - Investor Relations
+1 (866) 890 0443
+54 (11) 4018 8389
www.ternium.com

SOURCE: Ternium S.A.

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