Steelmaker Ternium’s net profit plummets nearly 95% in fourth quarter

MEXICO CITY, Feb 14 (Reuters) – Steelmaker Ternium said on Tuesday its net profit fell nearly 95% year-on-year to $59 million amid rising costs and falling steel prices in its markets.

The company controlled by Argentinian-owned Luxembourg-based Techint group reported total revenue of $3,546 million from October to December, down 18% from the same period in 2021.

Steel revenues per ton fell in the fourth quarter of 2022, reflecting lower prices in the markets where Ternium operates, according to its earnings report. On an annual basis, billings per ton fell $352 last year.

Ternium, with operations in Argentina, Brazil, Colombia, the United States, Guatemala and Mexico, announced that its steel shipments during the fourth quarter reached 3 million tonnes, of which 1.9 million corresponding to the Mexican market.

Falling steel prices as well as high production costs per ton have put severe pressure on the company’s margins in 2022, according to its report.

“The company expects this momentum to gradually reverse over the next few quarters, with margins expected to normalize as costs per ton decline,” the company said.

In the southern region, Ternium said its shipments fell 6% year-on-year last year as steel sales slowed in Argentina.

In 2022, the steelmaker’s net sales rose 2% to $16.414 million, while net profit fell nearly 50% to $2.093 million from $4.367 million in 2021.

Meanwhile, sales volumes in Mexico were up 5% year-on-year last year, the company added, noting that economic conditions in the country continued to improve despite high inflation and difficult financial conditions.

Steel shipments in 2022 maintained similar levels to 2021, at 11.9 million tonnes; while adjusted earnings before interest, tax, depreciation and amortization (EBITDA) fell 80% in the final quarter of last year to $303 million.

(Report by Marion Giraldo and Valentine Hilaire, edited by Lizbeth Díaz)