Ternium SA (TX) 2024 Q2 法說會逐字稿

Thank you for standing by. My name is Kayla, and I will be your conference operator today. At this time, I would like to welcome everyone to the Ternium second-quarter 2024 results. (Operator Instructions) I would now like to turn the call over to Sebastian Marti. You may begin.

謝謝你的支持。我叫凱拉，今天我將擔任你們的會議操作員。此時此刻，我謹歡迎大家關注 Ternium 2024 年第二季業績。 （接線員指示）我現在想將電話轉給 Sebastian Marti。你可以開始了。

Thank you. Good morning, and thank you for joining us. My name is Sebastian Marti, Ternium's Global IR and Compliance Senior Director. Yesterday, Ternium released its financial results for the second quarter and the first half of 2024. This call is intended to complement that presentation. I'm joined today by Maximo Vedoya, Ternium's Chief Executive Officer; and Pablo Brizzio, Ternium's Chief Financial Officer, who will discuss Ternium's business environment and performance. We will open the floor to questions following our prepared remarks.

謝謝。早安，感謝您加入我們。我叫 Sebastian Marti，Ternium 的全球 IR 和合規高級總監。昨天，Ternium 發布了 2024 年第二季和上半年的財務業績。今天，Ternium 執行長 Maximo Vedoya 也加入了我的行列。 Ternium 財務長 Pablo Brizzio 將討論 Ternium 的商業環境和績效。我們將在準備好發言後開始提問。

Before we begin, I would like to remind you that this conference call contains forward-looking information and that actual results may vary from those expressed or implied. Factors that could affect results are contained in our filings with the Securities and Exchange Commission and on page 2 in today's webcast presentation. You will also find any reference to non-IFRS financial measures reconciled to the most directly comparable IFRS measures in the press release issued yesterday. With that, I'll turn the call over to Mr. Vedoya.

在開始之前，我想提醒您，本次電話會議包含前瞻性訊息，實際結果可能與明示或暗示的結果有所不同。可能影響結果的因素包含在我們向美國證券交易委員會提交的文件以及今天網路廣播簡報的第 2 頁。您也可以在昨天發布的新聞稿中找到與最直接可比較的 IFRS 指標一致的非 IFRS 財務指標的參考資訊。這樣，我會將電話轉給 Vedoya 先生。

Good morning and thank you for joining us today for our second quarter's earnings call. Ternium posted a healthy adjusted EBITDA of $545 million for the second quarter, maintaining stable shipments, with a 12% margin during a weak steel price environment. The company generated strong cash from operation of $656 million, which contributed to maintaining a solid net cash position of $1.9 billion, even after distributing record dividends during the quarter and sustaining significant capital expenditures due to ongoing expansion initiatives.

早安，感謝您今天參加我們的第二季財報電話會議。 Ternium 公佈第二季調整後 EBITDA 為 5.45 億美元，保持穩定的出貨量，在疲軟的鋼材價格環境下利潤率為 12%。該公司從營運中產生了6.56 億美元的強勁現金，這有助於維持19 億美元的穩健淨現金頭寸，即使在本季度派發創紀錄的股息並由於持續的擴張計劃而維持大量資本支出之後也是如此。

In addition, net income during the quarter was affected by the recording of an accounting provision that we were required to make as a result of an adverse Brazilian court decision issued in last June related to our acquisition of a stake in Usiminas back in 2012. Ternium believes that such decision is contrary to applicable substantive and procedural law. We did not acquire sole control over Usiminas when we joined the control group. The court's change in their previous view now finding that a change of control occurred contradicts both the terms of the Usiminas shareholders' agreement and how Usiminas' governance worked in reality.

此外，本季的淨利潤也受到會計準備金記錄的影響，由於去年 6 月巴西法院就我們 2012 年收購 Usiminas 的股份做出了不利的決定，因此我們需要做出會計準備金記錄。的決定違反了適用的實體法和程序法。當我們加入對照組時，我們並沒有獲得Usiminas的單獨控制權。法院改變了先前的觀點，現在發現控制權發生了變化，這與 Usiminas 股東協議的條款以及 Usiminas 治理的實際運作方式相矛盾。

Consequently, we plan to strongly defend our position, which has been confirmed by a long line of precedents and court decisions and file all motions and appeals available to us. All such notions and appeals will need to be resolved before the case becomes final, and the determination of an actual payment amount, if any, should be made by a lower court in a separate proceeding.

因此，我們計劃堅決捍衛我們的立場，這一立場已被大量先例和法院判決所證實，並提出我們可以利用的所有動議和上訴。所有此類想法和上訴都需要在案件最終確定之前解決，並且實際付款金額（如果有）應由下級法院在單獨的訴訟中確定。

Let me now give you an update on our growth projects. I am glad to say that we just started up the first line in the downstream project, a 550,000 tonnes split in line, and also the first line in our new finishing center in Pesqueria. The rest of the finishing lines should be ready by the end of the year, and the cold rolling mill and galvanized lines are on track to be delivered between the end of next year and the beginning of 2026.

現在讓我向您介紹我們成長專案的最新情況。我很高興地說，我們剛剛啟動了下游計畫的第一條生產線，一條 55 萬噸的分離式生產線，也是我們位於 Pesqueria 的新精加工中心的第一條生產線。其餘精軋線應在今年年底前完工，冷軋機和鍍鋅線預計在明年底至2026年初交付。

In addition, in early July, we introduced a new galvanize simulator in our R&D center in Mexico. This will enable us to shorten certification times and improve the assessment of our product quality. With the downstream project in Mexico and our new R&D center, we are adding more value-added products that will enable us to better serve our customers in the automotive, renewable energy and home appliance industries, as well as in the construction and agriculture sectors. These new lines are a great opportunity for us to consolidate our position as a leading steel supplier in the region, as we continue to meet the demand for high-end steel products in Mexico, displacing steel imports and benefiting from nearshoring.

此外，7月初，我們在墨西哥的研發中心推出了新型鍍鋅模擬器。這將使我們能夠縮短認證時間並改善對產品品質的評估。透過墨西哥的下游計畫和新的研發中心，我們正在增加更多的增值產品，這將使我們能夠更好地服務汽車、再生能源和家電行業以及建築和農業領域的客戶。這些新生產線對我們來說是一個很好的機會，可以鞏固我們作為該地區領先鋼鐵供應商的地位，因為我們將繼續滿足墨西哥對高端鋼鐵產品的需求，取代鋼鐵進口並受益於近岸外包。

In addition, the new 2.6 million tonnes steel slab mill in Pesqueria continues to advance with completion expected by mid-2026. These projects will enhance our capabilities in the USMCA region and position us as a leader in low emission steelmakers. This is the largest expansion project in our history, and we are thrilled about its progress.

此外，位於 Pesqueria 的新 260 萬噸板坯軋機繼續推進，預計於 2026 年中期竣工。這些項目將增強我們在 USMCA 地區的能力，並使我們成為低排放鋼鐵製造商的領導者。這是我們歷史上最大的擴建項目，我們對其進展感到非常興奮。

Let me now make some comments about our main steel markets. The steel market in Mexico remains healthy, operating at good levels after last year's significant 14% year-over-year increase in apparent steel consumption. Industrial steel market is stable and strong with the auto industry showing healthy steel demand. Automotive production in Mexico in the first half of this year increased 5% year over year. The commercial market has been a little more affected by the steel prices downturn during the quarter, which induces a destocking process.

現在讓我對我們主要的鋼鐵市場發表一些評論。墨西哥鋼鐵市場保持健康，去年鋼材表觀消費量較去年同期大幅成長 14%，運作水準良好。工業用鋼市場穩中走強，汽車業用鋼需求健康。今年上半年墨西哥汽車產量年增5%。本季商業市場受鋼材價格下跌的影響更大，從而引發了去庫存過程。

In addition, construction activity has -- was impacted by a tropical storm by the end of the quarter. On the other hand, activity related to warehousing and logistics infrastructure continues to be strong, as well as natural gas pipeline projects. A recent development in this market was the implementation of the -- by the US administration of a 25% duty under Section 232 on imports from Mexico of steel produced, not melted and poured in the USMCA region. Following this, Mexico's President announced that export of steel products made with Brazilian steel would be exempted from this duty. This exception is in process of being formal.

此外，到本季末，建築活動也受到熱帶風暴的影響。另一方面，與倉儲和物流基礎設施以及天然氣管道項目相關的活動持續強勁。該市場最近的一個發展是，美國政府根據第 232 條規定，對從墨西哥進口的在 USMCA 地區生產、未熔化和澆注的鋼鐵徵收 25% 的關稅。此後，墨西哥總統宣布，出口由巴西鋼鐵製成的鋼鐵產品將免關稅。此例外正在正式化。

Regarding this subject, there has been much discussion in the US market about a supposed surge of steel -- of Mexican steel imports and about the need to control transshipments of Chinese steel through Mexico. So, let me be clear, this view is mistaken, and trade data indicates even the opposite situation. Steel trade between Mexico and the US is mutually beneficial with a surplus for the US. In 2023, the US exported 4.1 million metric tonnes of finished steel to Mexico. On the other hand, Mexico exported 2.3 million tonnes of finished steel to the US. This is 43% less than what the US exported to Mexico. Looking at these numbers in terms of market share, steel from the US represents 14% of Mexican market share, while Mexico steel represents only 2.5% of US market share.

關於這個主題，美國市場上有很多關於墨西哥鋼鐵進口量激增以及控制中國鋼鐵通過墨西哥轉運的必要性的討論。所以，我要澄清的是，這種觀點是錯誤的，貿易數據甚至顯示了相反的情況。墨西哥和美國之間的鋼鐵貿易是互惠互利的，美國有順差。 2023年，美國向墨西哥出口了410萬噸成品鋼材。另一方面，墨西哥向美國出口了230萬噸成品鋼材。這比美國對墨西哥的出口量少 43%。從市佔率來看，美國鋼鐵佔墨西哥市佔率的14%，而墨西哥鋼鐵僅占美國市佔率的2.5%。

Regarding the surge in imports from Mexico, when comparing the first five months of this year, US export of finished steel to Mexico increased by 7% compared to the same period in 2023. In contrast, Mexican exports to the US decreased by 12%. This followed the trend observed in 2023 when US export of finished steel to Mexico rose by 11%, while Mexico's export to the US declined by 28% year over year.

關於從墨西哥的進口激增，與今年前五個月相比，美國對墨西哥的成品鋼材出口與2023年同期相比成長了7%。這與2023年觀察到的趨勢一致，當時美國對墨西哥的成品鋼材出口成長了11%，而墨西哥對美國的出口較去年同期下降了28%。

And regarding China's transshipment, US statistics published in FEMA shows that in 2023, 144,000 tonnes of steel melted in China entered the US via third countries. Of that volume, 52% come from Thailand, 15% from Oman, 13% from Canada. Mexico was responsible for only 0.2% of that volume, almost nothing. Mexico has shown a strong commitment to fight against unfair trade practice, mainly from Asian countries, which truly harm the USMCA economy, and it continues -- and Mexico continues to work on this issue. So, to avoid misconception, USA trade data plainly show that there's neither a surge nor China transshipment in Mexico steel exports to the US market.

至於中國的轉運，美國聯邦緊急管理局公佈的統計數據顯示，2023年，有14.4萬噸中國熔化的鋼鐵透過第三國進入美國。其中，52% 來自泰國，15% 來自阿曼，13% 來自加拿大。墨西哥僅佔該總量的 0.2%，幾乎為零。墨西哥已表現出堅定的承諾，打擊主要來自亞洲國家的不公平貿易行為，這些行為真正損害了美墨加協定的經濟，而且墨西哥將繼續致力於解決這一問題。因此，為了避免誤解，美國貿易數據明確顯示，墨西哥向美國市場的鋼鐵出口既沒有激增，也沒有中國轉運。

Moving now to Brazil, the operational issues we had with one blast furnace in our Rio de Janeiro slab facility were resolved, and the furnace is back to full capacity now, although this had an impact on our shipments in Mexico during the second quarter. On the other hand, Usiminas' shipments in Brazil grew by 6%, with growth in all segments, especially in the automotive industry and manufacturing sector, reflecting growth in apparent consumption of flat steel in the country during the second quarter.

現在轉到巴西，我們裡約熱內盧板坯工廠的一台高爐的運行問題已得到解決，該高爐現已恢復滿載運轉，儘管這對我們第二季度在墨西哥的發貨量產生了影響。另一方面，Usiminas在巴西的出貨量成長了6%，所有細分領域都有成長，尤其是汽車產業和製造業，反映出該國第二季扁鋼表觀消費量的成長。

Crude steel production increased 17% in the second quarter. This is due to the stabilization of Usiminas' blast furnace number three, which has now finished its ramp-up. In June, this blast furnace was able to achieve the highest monthly production of the last 11 years. There are significant efficiency gains being achieved, as what Usiminas does today with two blast furnaces in the past was done with three blast furnaces.

第二季粗鋼產量成長17%。這是由於烏西米納斯三號高爐的穩定，該爐現已完成產能提升。 6月份，該高爐實現了近11年來的最高月產量。效率顯著提高，正如 Usiminas 過去使用三座高爐所做的那樣，現在使用兩座高爐。

On the other hand, as we have talked in the past, the Brazilian steel sector faces a serious threat from imports in the domestic market and the predatory conditions, mostly from China. The recent increase in import tariffs to 25% for some steel products that exceed a certain quarter is a positive, but until now, inefficient measure. It falls short of what other countries in the region have adopted to safeguard their local producers. And we have not seen any significant decline in imports during the second quarter. We have faith that the authorities will acknowledge the situation and maintain their course of action with the introduction of additional trade measures down the road.

另一方面，正如我們過去談到的那樣，巴西鋼鐵業面臨國內市場進口和掠奪性條件（主要來自中國）的嚴重威脅。最近將一些超過一定季度的鋼鐵產品的進口關稅提高到25%，這是一項積極的措施，但到目前為止，還是低效率的措施。它不及該地區其他國家為保護當地生產商而採取的措施。我們沒有看到第二季進口出現明顯下降。我們相信，當局將承認這一情況並繼續採取行動，並在未來採取更多貿易措施。

In Argentina, shipments began to recover after the significant decrease in the first quarter, reflecting a gradual improvement in steel demand, although they continue to be affected by short-term impact of Argentina's government economic stabilization measures on the construction and industrial sectors.

阿根廷方面，出貨量在第一季大幅下降後開始恢復，反映出鋼材需求逐步改善，但仍持續受到阿根廷政府對建築和工業部門經濟穩定措施的短期影響。

On our climate change initiative, our climate change initiatives are advancing with the on-schedule construction of our first wind farm in Buenos Aires province in Argentina, which should be operational by yearend. In addition, our technical school in Pesqueria was recognized by the Mexican government in the voluntary national reports towards United Nations' agenda for sustainability development. Our technical school was considered as an institution that serves as a model of how companies can positively impact their communities and sustainability. Since its establishment in 2016, the school has graduated more than 600 students with 83% either studying or employed. We are extending this practice to Brazil with the construction of our second technical school in Santa Cruz, near our plant in Rio de Janeiro, which -- with activities set to commence next (technical difficulty).

在我們的氣候變遷倡議方面，我們的氣候變遷倡議正在推進，我們在阿根廷布宜諾斯艾利斯省的第一個風電場正在按計劃建設，預計將於年底投入運營。此外，我們位於佩斯克里亞的技術學校在聯合國永續發展議程的自願國家報告中得到了墨西哥政府的認可。我們的技術學校被認為是一個機構，可以作為公司如何對其社區和永續發展產生積極影響的典範。自2016年成立以來，學校已畢業學生600餘人，其中83%正在就讀或就業。我們正在將這種做法擴展到巴西，在聖克魯斯建造我們的第二所技術學校，靠近我們在裡約熱內盧的工廠，接下來將開始開展活動（技術難度）。

Finally, I am positive regarding Ternium's performance as we move through the following quarters. After an expected bottom of margins in the third quarter related to the lag reset of contract price at lower levels, we anticipate shipments to continue growing with healthy demand in our main markets and margins to increase as steel prices are beginning to rise and costs are showing down trends. Okay. Pablo, please proceed now with your comments about our performance in the second quarter.

最後，我對 Ternium 在接下來幾季的表現持正面態度。由於合約價格滯後重置於較低水平，預計第三季利潤率將見底，我們預計，隨著主要市場的健康需求，出貨量將繼續增長，隨著鋼材價格開始上漲和成本顯現，利潤率將增加下降趨勢。好的。 Pablo，現在請繼續對我們第二季的業績發表評論。

Thanks, Maximo, and good morning to everyone. Let's now look at the webcast presentation for detailed review of our company operating and financial results. If we start with page 3, we will review the second quarter performance. Our adjusted EBITDA achieved $545 million. The primary drivers of the sequential change were lower realized prices in our key markets, together with a modest rise in cost per ton. Consequently, our adjusted EBITDA margin saw a slight decrease, settling at 12%.

謝謝馬克西莫，祝大家早安。現在讓我們來看看網路廣播演示，詳細回顧我們公司的營運和財務表現。如果我們從第 3 頁開始，我們將回顧第二季的業績。我們調整後的 EBITDA 達到 5.45 億美元。連續變化的主要驅動因素是我們主要市場的實際價格較低，以及每噸成本的小幅上漲。因此，我們調整後的 EBITDA 利潤率略有下降，穩定在 12%。

Looking ahead to the third quarter, Ternium expects a decline in adjust EBITDA. That is mainly due to an increase in EBITDA margins, although increased shipments across key markets will partially offset this impact. We anticipate lower realized steel prices in the third quarter, primarily because contract prices in Mexico will adjust to lower levels as a result of soft spot prices conditions during the second quarter.

展望第三季度，Ternium 預計調整後 EBITDA 將下降。這主要是由於 EBITDA 利潤率的增加，儘管主要市場出貨量的增加將部分抵消這一影響。我們預計第三季的鋼材實現價格將下降，主要是因為第二季現貨價格疲軟，墨西哥的合約價格將調整至較低水準。

Net income during the quarter was negatively affected by recording of a $783 million provision for the ongoing litigation related to the acquisition of participation in Usiminas in 2012 that Maximo already mentioned. We were required to make as a result of the adverse Brazilian court decision issued in June. Excluding this provision, adjusted net income decreased sequentially to $40 million, reflecting a significant change in deferred taxes of $191 million due to the 9% depreciation of the Mexican peso against the US dollar during the quarter.

Maximo 已經提到，由於與 2012 年收購 Usiminas 股份相關的正在進行的訴訟，記錄了 7.83 億美元的準備金，因此該季度的淨利潤受到了負面影響。由於巴西法院在 6 月做出不利裁決，我們被要求做出上述決定。剔除此項撥備後，調整後淨收入環比下降至 4,000 萬美元，反映出由於本季度墨西哥比索兌美元貶值 9%，遞延稅項發生了 1.91 億美元的重大變化。

Now, let's turn our attention to the performance of our steel segment on page 4. In our last earnings release call, we guided for an increase in shipment in Mexico. In fact, Ternium's steel shipment in Mexico experienced slight decline in the second quarter. As already explained by Maximo, in the commercial market, demand was negatively affected by a downturn in steel prices during the whole quarter. In addition, shipments were also negatively impacted by a tropical storm, which affected the value chain in the State of Nuevo Leon and Tamaulipas during June. In industrial markets, the automotive industry remained strong with some small decline in household appliance industry, tied to increasing housing in the US. Looking forward, we anticipate a consistent demand in Mexico industrial and commercial markets with supply chain stocks in manageable levels.

現在，讓我們將注意力轉向第 4 頁的鋼鐵部門的表現。事實上，第二季Ternium在墨西哥的鋼鐵出貨量略有下降。正如Maximo已經解釋的那樣，在商業市場，整個季度的需求受到鋼價下跌的負面影響。此外，熱帶風暴也對出貨量產生了負面影響，熱帶風暴在 6 月影響了新萊昂州和塔毛利帕斯州的價值鏈。在工業市場，汽車產業依然強勁，但與美國住房成長有關的家用電器產業略有下降。展望未來，我們預期墨西哥工業和商業市場的需求將持續存在，供應鏈庫存處於可控水準。

Shipments in Brazil increased sequentially by 6% in the second quarter, with growth across all segments, particularly in the automotive industry and the manufacturing sector. Looking ahead, we expect a rise in shipments in the third quarter, supported by the projected growth of the automotive industries and advances in the construction sector.

第二季巴西的出貨量較上季成長 6%，各個領域均實現成長，特別是汽車產業和製造業。展望未來，我們預計，在汽車業預計成長和建築業進步的支持下，第三季出貨量將出現成長。

In the Southern Region, steel shipments saw slight increase, reflecting improving conditions in the Argentina steel market. While the pace of the recovery for Argentina remains uncertain, we anticipate an increase in shipment in the third quarter.

在南部地區，鋼材出貨量小幅成長，反映出阿根廷鋼材市場狀況的改善。儘管阿根廷的復甦步伐仍不確定，但我們預計第三季的出貨量將會增加。

Let's now review the steel segment consolidated sales and profitability on the next page. Looking at the upper-left chart, steel product sales declined in the second quarter, primarily due to lower realized steel prices in Ternium's main markets. Cash operating income per tonne and margins for the steel segment, in the top right chart, were also impacted by the price decline. Additionally, cost per ton increased slightly during this period. Looking ahead, we expect margins to decline sequentially in the third quarter, primarily due to the effect of contract prices in Mexico to lower levels and the current soft spot prices condition.

現在讓我們回顧一下下一頁鋼鐵部門的綜合銷售額和獲利能力。從左上圖來看，第二季鋼鐵產品銷售量下降，主要是因為 Ternium 主要市場的鋼材實現價格較低。右上角圖表中鋼鐵業務的每噸現金營業收入和利潤率也受到價格下跌的影響。此外，在此期間每噸成本略有增加。展望未來，我們預計第三季利潤率將環比下降，這主要是由於墨西哥合約價格下降以及當前現貨價格疲軟的影響。

Now, let's turn to page 6 to examine the performance of the mining segment. We see that net sales for the mining segment remained stable as both volume and revenue per tonne in the second quarter were steady.

現在，讓我們翻到第6頁來檢查挖礦部分的表現。我們看到採礦領域的淨銷售量保持穩定，因為第二季的產量和每噸收入都穩定。

On page 7, let's see the adjusted EBITDA and net income. As previously commented, the top chart highlighted the primary factors we have in the sequential decrease in adjusted EBITDA, a significant drop in realized prices in our key markets and a minor increase in cost per ton. In the chart below, we can see the impact of net results from the decreased operating income and the higher deferred tax loss, primarily due to the depreciation of the Mexican peso, as I mentioned before. This was partially offset by improved financial results.

在第 7 頁，我們查看調整後的 EBITDA 和淨利潤。正如先前所評論的，上圖強調了導致調整後 EBITDA 連續下降、主要市場實現價格大幅下降以及每噸成本小幅上升的主要因素。在下圖中，我們可以看到營業收入減少和遞延稅損失增加對淨利潤的影響，這主要是由於墨西哥比索貶值，正如我之前提到的。這被財務表現的改善部分所抵銷。

Now, let's proceed to the next slide to evaluate our cash flow performance in the second quarter. Strong cash flow provided by operational activities of $656 million, helped in part by a decrease in working capital. Capital expenditures were $409 million during this period and advancing the development of the downstream and upstream projects in Pesqueria industrial center and also the advances in the constructions in our new wind farm in Argentina. The strong cash generated, together with $150 million increase in the fair value of financial instruments, contributed to maintain Ternium's solid financial position as of the end of the second quarter with a net cash position of $1.9 billion, experiencing only a modest decline during the quarter, while we paid a record level of dividends.

現在，讓我們繼續看下一張投影片來評估我們第二季的現金流表現。營運活動帶來的強勁現金流達 6.56 億美元，部分得益於營運資金的減少。在此期間的資本支出為4.09億美元，推動了Pesqueria工業中心下游和上游項目的開發，以及我們在阿根廷的新風電場的建設進展。強勁的現金產生，加上金融工具公允價值增加 1.5 億美元，有助於維持截至第二季末 Ternium 穩健的財務狀況，淨現金頭寸為 19 億美元，本季度僅略有下降，同時我們支付了創紀錄水準的股息。

Coming to page 9, let's see our performance in the first half of the year. Steel shipment reached 7.7 million tonnes in the first half. This growth was primarily driven by a consolidation of Usiminas, which also influenced mining shipments, as shown in the upper right chart. Adjusted EBITDA for the first half of the year was 1.5 -- $1.4 billion. The margin declined year-over-year, largely due to lower steel prices and the consolidation of Usiminas in the second half of last year. In the lower right chart, adjusted earnings per ADS stood at 1.7 in the first half. This represents a decline compared to the first half of last year. The decrease is attributable to lower operating results and the deferred tax loss I've mentioned before.

來到第9頁，讓我們來看看我們上半年的表現。上半年鋼材出貨量達770萬噸。這一成長主要是由 Usiminas 的整合所推動的，這也影響了採礦業的出貨量，如右上圖所示。上半年調整後 EBITDA 為 150 至 14 億美元。利潤率年減，主要是由於去年下半年鋼材價格下跌以及Usiminas的整合。在右下圖表中，上半年調整後美國每股存託股本收益為 1.7。與去年上半年相比，這一數字有所下降。減少的原因是經營業績下降和我之前提到的遞延稅損失。

On the final slide, cash flow from operations was strong in the first half of 2024, amounting to $1.1 billion. After accounting for capital expenditures of $858 million, free cash flow in the first half of the year was $274 million. So with this, we end our initial remarks, and we can now start the Q&A session. Thank you very much for your attention. Please go ahead.

最後一張投影片顯示，2024 年上半年營運現金流強勁，達到 11 億美元。扣除8.58億美元的資本支出後，上半年自由現金流為2.74億美元。至此，我們的初步發言結束，現在可以開始問答環節了。非常感謝您的關注。請繼續。

(Operator Instructions) Caio Ribeiro, Bank of America.

（操作員指示）Caio Ribeiro，美國銀行。

Good morning, everyone. Thanks for the opportunity. So, my first question is more market related. I just wanted to see if you could provide an update on HRC prices in the US, which have been under pressure over the last months, and whether you see any green shoots emerging ahead, which could support a rebound.

大家，早安。感謝您提供的機會。所以，我的第一個問題比較與市場相關。我只是想知道您是否可以提供美國熱軋捲價格的最新情況，過去幾個月美國熱軋捲價格一直面臨壓力，以及您是否看到未來出現任何可能支持反彈的新芽。

And then secondly, more specific to MUSA, and I just wanted to see if you have any updates on that front, any revised CapEx expectations regarding the potential expansion at the MUSA asset, and when you would expect to take a decision with that project or not. And then on a similar note, and still related to MUSA, with the recent correction in iron ore prices to $100 per ton, whether there would be any changes to your planned production levels in the asset? And if not, if there would be a certain price level where you would contemplate reducing your third-party iron ore sales from that asset? Thank you.

其次，更具體地針對 MUSA，我只是想了解您在這方面是否有任何更新、關於 MUSA 資產潛在擴張的任何修訂後的資本支出預期，以及您預計何時對該項目或不是。然後，類似地，仍然與 MUSA 有關，隨著最近鐵礦石價格調整至每噸 100 美元，您的資產計劃生產水平是否會有任何變化？如果沒有，是否存在一定的價格水平，您會考慮減少該資產的第三方鐵礦石銷售？謝謝。

Thank you, Caio, for your questions. The first one, prices in North America or in the US, I mean, I said it in my initial remarks, hot rolled coils in the US were down to around $700 per metric tonne by the end of last month. But we are seeing today that these prices -- by the end of July, not last month, by the last week, I guess, but we are seeing increasing prices. So we feel that this is a bottom of the price. Of course, in our pricing, some part of this, you're not going to realize it in the third quarter because of the lack of the contract part of our business. But yes, we are seeing this to be the bottom part, and we are seeing some indication that this is coming up. In a more medium or long-term, as I always said, I think that demand both in the US and in Mexico is still very strong in different sectors.

謝謝凱奧的提問。第一個，北美或美國的價格，我的意思是，我在最初的演講中說過，到上個月底，美國熱軋捲材價格已降至每噸 700 美元左右。但我們今天看到這些價格 - 到七月底，而不是上個月，我猜是上週，但我們看到價格上漲。所以我們覺得這是價格的底部。當然，在我們的定價中，其中的某些部分，你不會在第三季意識到這一點，因為我們業務中缺乏合約部分。但是，是的，我們認為這是底部部分，我們看到一些跡象表明它即將出現。從中期或長期來看，正如我一直所說的，我認為美國和墨西哥不同行業的需求仍然非常強勁。

But I see Mexico, although it grew by 14% last year, the apparent consumption of steel is still growing in Mexico, and I see robust demand in the US. Again, I think that what impacted prices in the last couple of months was the excess production of China, which -- that production, for the last five or six months, China has been on a record of export of steel. And this is coming down, and it has to come down. It's not that this volume is coming to the US or Mexico. But clearly, this is affecting other markets, which then are shipping to Mexico and the US. So on the bottom, I think, yes, it is a bottom, and we are seeing clear evidence that prices are going up and will be going up in the near future. I hope with this, Caio, I answered your questions, the first one, at least.

但我看到墨西哥，雖然去年成長了14%，但墨西哥的鋼鐵表觀消費量仍在成長，我看到美國的需求強勁。我再次認為，過去幾個月影響價格的因素是中國的生產過剩，在過去的五、六個月裡，中國的鋼鐵出口一直處於創紀錄的水平。這正在下降，而且必須下降。這並不是說這本書會銷往美國或墨西哥。但顯然，這正在影響其他市場，然後這些市場將運往墨西哥和美國。因此，在底部，我認為，是的，這是一個底部，我們看到明顯的證據表明價格正在上漲，並且在不久的將來將會上漲。 Caio，我希望我能回答你的問題，至少是第一個問題。

Yes, definitely. That's very clear. Thank you, Maximo.

當然是。這非常清楚。謝謝你，馬克西莫。

Perfect. Second, MUSA, I think we talked in the past, but I don't remember, but the decision of the MUSA project should be taken by the end of next year. We are working on the project. We are working in all -- advancing in all the things that -- we are advancing engineering, which will be the technology, the permission, the -- yes, all the permissions that we need, the scope of the project. There is a team working on everything. But the decision -- we are not going to make the decision this year. Probably it should be by the end of next year.

完美的。第二，MUSA，我想我們過去談過，但我不記得了，但是MUSA計畫的決定應該在明年年底做出。我們正在研究這個項目。我們正在努力推進所有的事情，我們正在推進工程，這將是技術、許可，是的，我們需要的所有許可，專案的範圍。有一個團隊在做所有事情。但我們不會在今年做出決定。大概應該是明年年底。

And regarding the production, we are not seeing today a decline or a huge decline in production. As you well mentioned, prices have been a little bit volatile, but they are decreasing to $100, then going up a little bit, then decreasing again to $100, then going up a little bit. So it seems that $100 is kind of the bottom of the spectrum of the prices of iron ore. It's not the price that we are very, very comfortable, but MUSA can work with that price. So we are not expecting a huge decline in volumes in MUSA, but probably a part or a small part, we are revising the marginal cost of some of the production of MUSA, but it shouldn't be huge.

關於產量，我們今天沒有看到產量下降或大幅下降。正如您所提到的，價格有點波動，但它們正在下降至 100 美元，然後上漲一點，然後再次下降至 100 美元，然後上漲一點。因此，100 美元似乎是鐵礦石價格區間的底部。這不是我們非常非常舒服的價格，但 MUSA 可以以這個價格合作。因此，我們預計 MUSA 的產量不會大幅下降，但可能會部分或一小部分下降，我們正在修改 MUSA 部分生產的邊際成本，但應該不會很大。

Thank you, Maximo. That's super clear. I appreciate it.

謝謝你，馬克西莫。說的超清楚啊我很感激。

You're welcome, Caio.

不客氣，凱奧。

Carlos De Alba, Morgan Stanley.

卡洛斯·德阿爾巴，摩根士丹利。

Yeah, good morning, everyone. Thank you very much. Just a question, Maximo, maybe on the 25% import tariff that the US put on Mexican steel exports into the US that are not melted in the country. The 25% -- the exemption for Brazil, is that official and a done deal? Or is it still subject to negotiations and final decision? Because I haven't really seen an official document or announcement. And in fact, there is talk that maybe the US officials are having cold feet on that.

是的，大家早安。非常感謝。只是一個問題，馬克西莫，也許是美國對墨西哥出口到美國的未在該國熔化的鋼鐵徵收 25% 的進口關稅。 25%－巴西的豁免，是正式的協議嗎？還是仍待協商最後決定？因為我還沒有真正看到官方文件或公告。事實上，有傳言稱美國官員可能對此臨陣退縮。

I think -- hello. Good morning, Carlos. I think it's official. I mean, the President of Mexico announced it. So I don't know if -- and then there is a formal proclamation from the Mexican government saying this. So, I guess, it is official. I think that what is happening -- it has to be implemented. Remember, when they announced the 25%, the implementation came two weeks later. And I think this is happening now, but we are working under that assumption.

我想——你好。早安，卡洛斯。我認為這是官方的。我的意思是，墨西哥總統宣布了這一消息。所以我不知道墨西哥政府是否會正式宣布這一點。所以，我想，這是官方的。我認為正在發生的事情——必須實施。請記住，當他們宣布 25% 時，兩週後才實施。我認為這種情況現在正在發生，但我們正在這個假設下工作。

Yeah. What I'm hearing is that the US officials have not signed up on that. And the fact that Mexico -- Mexican President has said, it doesn't necessarily mean that the US is going to follow. But anyway, something to monitor clearly because of the relevance that it will have on Ternium's business.

是的。據我所知，美國官員尚未對此表示同意。墨西哥總統已經說過，這並不一定意味著美國會跟進。但無論如何，這是需要明確監控的事情，因為它與 Ternium 的業務有關。

And then, on Usiminas, how do you see the evolution of this lawsuit from CSN? I think you mentioned a little bit in your prepared remarks, but if you can elaborate a little bit more on what would be the next steps? And that would be one point. And the second point on the same topic is, apparently, there is a court decision that is forcing CSN to sell the shares that they own in Usiminas in the short term, I guess. Would Ternium negotiate with CSN and acquire those shares? Is that a possibility? Or you are not interested in increasing further your stake in Usiminas at this time?

那麼，關於Usiminas，您如何看待CSN這起訴訟的演變？我認為您在準備好的發言中提到了一些內容，但是您是否可以詳細說明接下來的步驟？這就是一點。關於同一主題的第二點是，顯然，法院的一項裁決迫使 CSN 在短期內出售他們在 Usiminas 的股份，我猜。 Ternium 會與 CSN 談判並收購這些股份嗎？有這種可能嗎？或者您目前沒有興趣進一步增加您在 Usiminas 的股份？

Okay. I'll answer the second question first, Caio -- Carlos -- sorry, Carlos, the same letter, at least. The second part of that question, the answer is no. And the first part of the question regarding the status of the CSN-Ternium judicial process, let me say that -- I mean, this is a judicial process that is ongoing right now, this week and the following weeks. So to be honest, I prefer not to add much more of what I have said already in my prepared remarks because -- I mean, as I said, it's something that is ongoing, and there's a lot of things going on. So I stick to what I said in my initial remarks, Carlos. I hope you understand.

好的。我先回答第二個問題，Caio——卡洛斯——抱歉，卡洛斯，至少是同一封信。這個問題的第二部分，答案是否定的。關於 CSN-Ternium 司法程序狀況的問題的第一部分，我想說的是，這是一個目前、本週和接下來幾週正在進行的司法程序。所以說實話，我不想在準備好的發言中添加更多我已經說過的話，因為——我的意思是，正如我所說，這是正在進行的事情，而且有很多事情正在發生。所以我堅持我在最初發言中所說的話，卡洛斯。我希望你明白。

Yeah, no, for sure. And then, just a follow-up on the first part of my second question. Why wouldn't Ternium negotiate with CSN more Usiminas shares? If you can add any color there, that would be great.

是的，不，當然。然後，我將繼續回答第二個問題的第一部分。為什麼 Ternium 不與 CSN 談判獲得更多 Usiminas 股份？如果你可以在那裡添加任何顏色，那就太好了。

Carlos, this is Pablo. First of all, as you know, this is a process that, you are right, is going on in Brazil, but the process in Brazil are long. So we cannot count that this will be the case immediately. So it's not -- we are not in any position to say what will happen and what we will do with respect to that. So it's happening in Brazil, but it's nothing that we can do at this moment.

卡洛斯，這是巴勃羅。首先，正如你所知，這是一個過程，你是對的，正在巴西進行，但巴西的過程是漫長的。所以我們不能指望這種情況會立即發生。所以，我們沒有能力說將會發生什麼以及我們將對此做什麼。所以這種情況正在巴西發生，但目前我們無能為力。

Okay. Thank you, Pablo.

好的。謝謝你，巴布羅。

Thank you, Carlos.

謝謝你，卡洛斯。

Thank you, Maximo.

謝謝你，馬克西莫。

Timna Tanners, Wolfe Research.

蒂姆納坦納斯，沃爾夫研究。

Hey good morning. Regarding the situation with the Brazilian imported slabs, it's all very interesting. But at the end of the day, does it really matter that much for Ternium if indeed, as you pointed out very nicely, Mexico doesn't export that much to the US? And also, it seems like you're pretty busy with good demand in Mexico. Lazaro Cardenas isn't going to produce much in the third quarter, if any? Are you seeing opportunities to take share? Can you talk a little bit more about any opportunity from AHMSA potentially declaring bankruptcy? Thanks.

嗨，早安。關於巴西進口板材的情況，非常有趣。但歸根結底，如果墨西哥確實沒有向美國出口那麼多產品，那麼對 Ternium 來說真的那麼重要嗎？而且，看來你們正忙著應付墨西哥的良好需求。拉扎羅·卡德納斯在第三季度不會有太多產出（如果有的話）？您是否看到了分享的機會？您能多談談 AHMSA 可能宣布破產的任何機會嗎？謝謝。

Thank you, Timna. You are a little bit right, but of course, nobody likes to have something taken away. And remember, we are not the only ones exporting to the US. So, the sense is, having a restriction in the export from Mexico to US for the melted and poured from Brazil, when both countries, the US and Mexico, both imports slabs from the US -- from Brazil, sorry, that doesn't make any sense. It's clearly for more -- the volume is maybe not big volume as the volume as a whole in Ternium, but it's a volume important for what Mexico exports to the US. So putting a restriction, as small as it may be, from the US -- from the Mexico to the US, when the US exports that much more to Mexico, it doesn't make any sense. And that's our position, to be honest. You're right that compared to all the volume that Mexico sells and our opportunities in the domestic market, it's not that big, but we need to fulfill our customers in the US also. So that's the first part of the question.

謝謝你，蒂姆納。你說得有點對，但當然，沒有人喜歡東西被拿走。請記住，我們並不是唯一出口到美國的國家。所以，感覺是，當美國和墨西哥這兩個國家都從美國進口板坯時，從巴西向美國出口熔化和澆注的板坯受到限制——抱歉，這並不意味著從美國進口板坯。任何意義。顯然是為了更多——這個數量可能不像 Ternium 的整體數量那麼大，但對於墨西哥向美國出口的產品來說，這個數量很重要。因此，從美國——從墨西哥到美國——施加一個限制，儘管可能很小，但當美國向墨西哥出口這麼多東西時，這是沒有任何意義的。老實說，這就是我們的立場。你是對的，與墨西哥的銷售量和我們在國內市場的機會相比，它並沒有那麼大，但我們也需要滿足我們在美國的客戶的需求。這是問題的第一部分。

You asked something about AHMSA. To be honest, we don't know much of AHMSA besides what's in the press that supposedly, there's a deadline for the -- I think it's August 4, where AHMSA should go to the bankruptcy process because there was no agreement. Nevertheless, I think it's still a long process. The bankruptcy process is not going to be something immediately. It's not a very easy bankruptcy process.

您詢問了有關 AHMSA 的問題。老實說，我們對 AHMSA 知之甚少，除了媒體報導的消息外，據推測，有一個最後期限——我認為是 8 月 4 日，AHMSA 應該進入破產程序，因為沒有達成協議。儘管如此，我認為這仍然是一個漫長的過程。破產程序不會立即進行。這不是一個非常容易的破產程序。

Got it. Thank you. So I recognize it's more about the principle. That's a really fair point. If you could also touch on any opportunity with Lazaro Cardenas? And then, if I could, a second question. If the price in the US is just starting to stabilize here for September, is that still enough to help the fourth quarter cadence for pricing? Just because I'm trying to think about the timing. And if you could also talk about the magnitude of the margin opportunity with some of the raw material decreases? Thanks.

知道了。謝謝。所以我認識到這更多的是原則。這是一個非常公平的觀點。您是否還可以談談拉扎羅·卡德納斯的任何機會？然後，如果可以的話，問第二個問題。如果美國的價格在 9 月剛開始穩定，這是否仍然足以幫助第四季的定價節奏？只是因為我正在考慮時機。您是否也可以談談一些原物料下降帶來的利潤機會的大小？謝謝。

Yeah. I think the prices in the fourth quarter, yeah, should improve because of the -- this increase in the prices that we are starting to see this week and should continue a little bit through this month and the following months. So yes, the magnitude of the increase, it's very difficult to say right now, Timna. I always said that a normal price in the North American region should be between 800 and 900, of course, with the volatility we are accustomed to. So, that's our view. But I don't -- I'm not saying that, that is going to be in the fourth quarter yet, but it's going to be increased.

是的。我認為第四季的價格應該會有所改善，因為我們本週開始看到價格上漲，並且在本月和接下來的幾個月裡應該會持續一點。所以，是的，增加的幅度，現在很難說，Timna。我一直說北美地區的正常價格應該在800到900之間，當然，還有我們已經習慣的波動。這就是我們的觀點。但我不--我不是這麼說的，這將在第四季度進行，但將會增加。

Okay. Timna, this is Pablo. You asked in relationship to the possibility of recoverability of the margins entering into the fourth quarter. As we always try to say, always the volatility could be there. But in the long run, we should be achieving certain level of margin. If we took together the first semester of this year, we are still at the level of 15%. So clearly, we will have a reduction during the third quarter because of all the things that we said. And if the prices that you mentioned and Maximo confirmed are increased, and these are reflected together with some reduction in costs that we need to see during the fourth quarter because of the first in - first out methodology that we utilized, should recover our margins to a higher level than what we see -- or what we will see in the third quarter. So yes, we have the chance to recover at the full year after all these effects, if we are correct, should position us in a very reasonable level of margins.

好的。提姆納，這是巴勃羅。您詢問了進入第四季度利潤恢復的可能性。正如我們總是試圖說的那樣，波動總是可能存在的。但從長遠來看，我們應該實現一定程度的利潤。如果我們把今年第一學期加起來，我們仍然處於15%的水平。很明顯，由於我們所說的所有事情，我們將在第三季進行削減。如果您提到的和 Maximo 確認的價格上漲，並且這些價格與我們需要在第四季度看到的成本下降一起反映出來，因為我們採用了先進先出的方法，那麼我們的利潤率應該會恢復到比我們看到的或第三季度看到的水平更高。所以，是的，在所有這些影響之後，我們有機會在全年恢復，如果我們是正確的，應該使我們處於非常合理的利潤水平。

Timna, let me put -- yes, let me add something more because I don't want to sound with this problem of the US melted and poured. Mexico -- and this is not Ternium. Mexico as a whole, exports something like 1.2 million, 1.4 million tonnes of flat products, which is finishing flat products, around that 1 million, 1.2 million. Of that, more than -- in volume or in price, something like half of that comes from not melted and poured, so semi-finished products, slabs that come from different parts, some of them from Brazil. It's not a huge volume, but it's very important for what Mexico exports to the US. So it doesn't make any sense to have this restriction in, as I said, the numbers I said before in my remarks.

提姆納，讓我補充一下——是的，讓我補充一些內容，因為我不想聽起來像美國融化和倒塌的問題。墨西哥——這不是Ternium。墨西哥作為一個整體，出口了大約120萬、140萬噸扁平材產品，其中正在精加工扁平材產品，大約是100萬、120萬噸。其中，無論是數量或價格，大約有一半來自未熔化和澆注的半成品、來自不同地區的板坯，其中一些來自巴西。雖然數量不是很大，但對於墨西哥向美國的出口來說非常重要。因此，正如我所說，對我之前在演講中所說的數字進行這種限制是沒有任何意義的。

Got it. Okay. Thanks again.

知道了。好的。再次感謝。

You're welcome.

不客氣。

Marcio Farid, Goldman Sachs.

馬西奧·法里德，高盛。

Thank you. Good morning. Maximo, I have a question on the demand side. You obviously mentioned that demand is quite strong, both in the US and in Mexico as well. Shipments for the quarter were relatively weak. My understanding is that that's basically buyers holding back purchases on a declining price environment. Just wanted to check with you if you're already seeing clients coming back and buying, since you are already seeing some initial signs of price stabilization and potentially HRC price recovery as well?

謝謝。早安. Maximo，我有一個關於需求方面的問題。您顯然提到美國和墨西哥的需求都非常強勁。該季度的出貨量相對疲軟。我的理解是，這基本上是買家在價格下跌的環境下推遲購買。只是想諮詢您是否已經看到客戶回來購買，因為您已經看到了一些價格穩定的初步跡像以及熱軋捲價格可能回升的跡象？

And secondly, just a follow-up on the taxation risk. I know you've talked a lot about the interdependence between US and Mexico for the trade flows, and it does feel like US is a lot more aggressive than Mexico at the moment, right? But with US elections just around the corner, what are the potential risks you are assessing that is -- even suggestion by one of our competitors that USMCA should end and these kind of things. But what are the kind of potential risks you're seeing on a new US administration into next year, please? Thank you.

其次，只是稅務風險的後續行動。我知道您已經談論了很多美國和墨西哥之間在貿易流動方面的相互依存關係，而且目前確實感覺美國比墨西哥更具侵略性，對嗎？但隨著美國大選在即，您正在評估的潛在風險是什麼——甚至是我們的競爭對手建議結束 USMCA 之類的事情。但您認為明年的美國新政府會面臨哪些潛在風險？謝謝。

Thank you, Marcio. The first part of the question, demand, yes, we are seeing a pickup in Mexico. Part of that is also because for external -- for different reasons. Also, we shipped a little bit less than what we should have shipped in the second quarter, not only because of the demand, but also because of the tornado Alberto, we were so weak with a lot of problems. Also the slab shipments from Brazil to Mexico also had problems because of the Brownsville port and some other issues, and the problem we have with the blast furnace. So we are seeing both things, a pickup in our shipments because of this and a pickup of our shipments because people are realizing, the ones that had stocks, that prices are starting to go up. So both things we are seeing, as you mentioned.

謝謝你，馬西奧。問題的第一部分，需求，是的，我們看到墨西哥的需求回升。部分原因也是因為外在原因──出於不同的原因。另外，我們第二季的出貨量比我們應該出貨的量少了一點，不僅是因為需求，還因為龍捲風阿爾貝托，我們非常虛弱，出現了很多問題。此外，由於布朗斯維爾港口和其他一些問題，以及我們的高爐問題，從巴西到墨西哥的板坯運輸也出現了問題。因此，我們看到了兩件事，一是我們的出貨量因此而增加，二是因為人們意識到，那些有庫存的人，價格開始上漲。正如您所提到的，我們正在看到這兩件事。

Regarding US, Mexico and USMCA, I don't see -- I mean, my view is going to be the same regardless of who is in the US government. I think Mexico and US relationship is a very strong one, and it's both sides. I don't see -- I mean, I see the USMCA as an excellent agreement for the three countries, not only for Mexico, for Canada or for the US. The three countries have benefited a lot from the US -- from the USMCA. If you put also -- let me give you some advice, but there's a lot of evidence about this. But if you take from 2019 to 2023, exports from the US to Mexico increased by 26%, so export of the US, and this is only in goods, not services, which is much more, 26%. Mexico also increased export to the US by 30%. But both numbers are similar. So both countries are benefiting a lot from that. You take the states of the US, 33 states in the US has Mexico as one of the top destination of their exports. I don't know, jobs -- there's a lot of evidence and different jobs -- of the millions of jobs the USMCA has created in the US.

關於美國、墨西哥和美墨加協定，我不認為──我的意思是，無論誰在美國政府任職，我的觀點都是一樣的。我認為墨西哥和美國的關係非常牢固，而且是雙方的。我不認為——我的意思是，我認為 USMCA 對這三個國家來說是一項出色的協議，不僅對墨西哥、加拿大或美國而言。這三個國家從美國——從美墨加協定中受益匪淺。如果你還提出——讓我給你一些建議，但有很多證據表明這一點。但如果從2019年到2023年，美國對墨西哥的出口增加了26%，所以美國的出口，這只是商品，而不是服務，這個數字要高得多，26%。墨西哥對美國的出口也增加了30%。但這兩個數字相似。因此，兩國都從中受益匪淺。以美國各州為例，美國有33個州將墨西哥作為其最大的出口目的地之一。我不知道，就業機會——有很多證據和不同的就業機會——USMCA 在美國創造了數百萬個就業機會。

So I don't see that somebody will think of changing or cancelling the USMCA with all the benefits that this is bringing to Mexico and to the US. I think there are some things that we can improve, for sure, but others, no.

因此，我不認為有人會考慮改變或取消 USMCA，因為它為墨西哥和美國帶來了所有好處。我認為有些事情我們確實可以改進，但其他方面則不行。

The other issue that you didn't mention it, but it's very mentioned in the press, is the Chinese investment in Mexico as a reason of, I don't know, putting in doubt the USMCA. But the numbers, again, they are not there. There are some Chinese companies investing in Mexico as there are some Chinese investment in the US. But if you take the foreign direct investment that China made in Mexico, and not one year, I put the last four years, 2020 to 2023, it's less than 1% of the FDA of all Mexico. So it's insignificant. Yes, there are some companies coming, but the numbers are very, very small. So there's not an invasion on anything of that. Again, that -- US is also receiving foreign direct investment from China and much more bigger numbers. But the bottom line here is, I think, it's mutual for the three countries. And yes, we have to, the three countries, make tough laws against unfair trade, not only steel, but in a lot of other products. We have to work together to make that possible.

另一個你沒有提到但媒體上經常提到的問題是中國在墨西哥的投資，我不知道，這是對美墨加協定產生懷疑的一個原因。但這些數字又不存在。有一些中國公司在墨西哥投資，就像有一些中國公司在美國投資一樣。但如果你考慮中國在墨西哥的外國直接投資，而不是一年，我把過去四年，2020年到2023年，它還不到整個墨西哥FDA的1%。所以這是微不足道的。是的，有一些公司來了，但數量非常非常少。所以這方面沒有任何入侵。再說一次，美國也正在接受來自中國的外國直接投資，而且數量也大得多。但我認為，底線是，這對這三個國家來說是相互的。是的，我們這三個國家必須制定嚴格的法律來打擊不公平貿易，不僅是鋼鐵，還包括許多其他產品。我們必須共同努力才能實現這一目標。

Alex Hacking, Citi.

亞歷克斯哈金，花旗銀行。

Yeah, thanks, good morning. I just wanted to ask quickly on Siderar. When I look at the financial statements for the quarter, they seem to be reporting an operating loss, and that's not including the provision, right? So, that would seem to be an underlying operating loss. Is that just FX accounting? Or is there something more fundamental that's happened at Siderar? And I guess, how would you see profitability there evolving in the third quarter? And am I even correct that there was an operating loss in the second quarter? Thank you.

是的，謝謝，早安。我只是想快速詢問一下Siderar。當我查看本季度的財務報表時，他們似乎報告了營業虧損，而且這還不包括撥備，對吧？因此，這似乎是潛在的營運虧損。這只是外匯會計嗎？還是 Siderar 發生了一些更根本的事情？我想，您如何看待第三季獲利能力的變化？我是否正確地認為第二季度存在營運虧損？謝謝。

Yeah, Alex, you are kind of correct. It's almost zero. The main issue -- and Pablo, then elaborate a little bit more. But the main issue is that the second quarter was a quarter where we -- the volumes were very low. Remember, first quarter and second quarter were the lowest level of Ternium Argentina in a long time. We are seeing now an increase in the volumes due to the situation of the Argentine market or the whole economy of market. But I don't know, Pablo, if you want to elaborate a little bit more.

是的，亞歷克斯，你是對的。幾乎為零。主要問題——還有巴勃羅，然後詳細說明。但主要問題是，第二季的銷量非常低。請記住，第一季和第二季是 Ternium Argentina 長期以來的最低水準。由於阿根廷市場或整個市場經濟的狀況，我們現在看到銷量增加。但我不知道，巴勃羅，你是否想詳細說明一下。

You're right. Alex, you're totally right. It was unfortunately not the best quarter for Ternium Argentina because not only what Maximo explained, we also had the -- some cost increase due to a first in - first out methodology that impacted all together in the same quarter. Again, we -- as we discussed before, in the -- at the very end, we then sum up the fourth quarter for the year, we should see a different result. We are expecting to see higher volumes during the coming quarters. We should see also some reduction in cost in the coming quarters. So the situation that you clearly saw during the second quarter should be reversed during the third and the fourth quarter.

你說得對。亞歷克斯，你完全正確。不幸的是，對於Ternium Argentina 來說，這並不是最好的季度，因為不僅如Maximo 所解釋的那樣，我們還因先進先出方法而導致了一些成本增加，該方法在同一季度共同影響了所有方面。再次，正如我們之前討論的那樣，最後，我們總結了今年第四季度的情況，我們應該會看到不同的結果。我們預計未來幾季的銷量將會增加。我們還應該看到未來幾季成本有所下降。所以你在第二季清楚看到的情況應該會在第三季和第四季發生逆轉。

Okay. Thanks. That's clear. It just caught my eye because (multiple speakers) for some calculation, it was the worst quarter in my model since 2012.

好的。謝謝。很清楚。它引起了我的注意，因為（多個發言者）經過一些計算，這是我的模型自 2012 年以來最糟糕的季度。

Leo Correa, BTG Pactual.

利奧·科雷亞，BTG Pactual。

Hello, good morning. So a couple of quick ones more detailed here, but hopefully you can help a bit. So first on, for you Pablo, the dividend situation, right? I mean Ternium has been consistently increasing the dividend over the past year. We're now, I mean, you guys still have a bit of a high CapEx program going forward given the projects in Mexico, and this is somewhat messy situation with Japan and this litigation, which we don't know exactly how this ends. Of course there are, you guys have great arguments, but you never know how to predict these things. And I can imagine there's a high level of uncertainty and as a consequence you're increasing your provision, right? So just wanted to double check if there's any risks that you guys reevaluate the dividend going forward. I know this is important decision, but anyway, just given how conservative you guys are on balance sheet management, I just wanted to double check on that.

你好早安。因此，這裡有一些更詳細的快速說明，但希望您能有所幫助。那麼首先，對你來說，巴勃羅，股息狀況，對嗎？我的意思是，Ternium 在過去一年中一直在持續增加股利。我的意思是，考慮到墨西哥的項目，我們現在仍然有一些高資本支出計劃正在進行，而日本和這場訴訟的情況有點混亂，我們不知道具體如何結束。當然有，你們有很好的論據，但你們永遠不知道該如何預測這些事。我可以想像存在很高的不確定性，因此您會增加準備金，對嗎？因此，我想仔細檢查你們重新評估未來股利是否有任何風險。我知道這是一個重要的決定，但無論如何，考慮到你們在資產負債表管理上的保守程度，我只是想仔細檢查一下。

Second point, we've been talking a lot about steel prices over this call. Clearly the situation in China is the key culprit. Not sure anything changes anytime soon. Looking at slab prices specifically, right? I mean the price has obviously collapsed close to $500. Just curious to hear you on how, I mean, how does CSA, right, how does Ternium grow slab plans? How can it operate in this environment? I mean, what type of economics are you generating? Is the plan breakeven at these levels? Just wanted to hear you a bit more on that. Thank you.

第二點，我們在這次電話會議中談了很多關於鋼材價格的問題。顯然，中國的情況是罪魁禍首。不確定很快會有什麼變化。具體看一下板坯價格吧？我的意思是，價格顯然已跌至接近 500 美元。只是好奇想聽聽您如何，我的意思是，CSA，對，Ternium 如何發展平板計劃？怎樣才能在這樣的環境下運作呢？我的意思是，你正在創造什麼類型的經濟學？該計劃在這些水準上是否達到損益平衡？只是想聽聽您對此的更多了解。謝謝。

Leo, Pablo here. Let me start with the first question regarding the dividend. We see no reason to change the -- what we have been doing in relationship to dividends. And let me expand a little bit on that. And you mentioned a couple of things in your question. We will continue to generate a very positive free cash flow that was reflected in the numbers during this quarter and the semester. And also, even though that we paid the record dividend during this first semester, the reduction in the total cash position of the company was very much not affected, so a very minor change in the level of net cash that the company continues to have.

利奧，巴勃羅在這裡。讓我先談談關於股息的第一個問題。我們認為沒有理由改變我們在股利方面所做的事情。讓我對此進行一些擴充。您在問題中提到了幾件事。我們將繼續產生非常積極的自由現金流，這反映在本季度和本學期的數字中。而且，儘管我們在第一季支付了創紀錄的股息，但公司總現金部位的減少並沒有受到很大影響，因此公司繼續擁有的淨現金水準發生了很小的變化。

The CapEx plan that we have is online, on track. So nothing that could change there because that was something that was expected before and that we will continue to do, so there shouldn't be anything in relationship to that. And then, what we have been discussing on the recoverability of margins and results, together with the pricing and increased volumes in the coming quarters, again, put us in a position to really in -- what we said we're doing there. We see no reason to change what we've been doing up to now with dividend payments. Maximo, you can take the second one.

我們的資本支出計畫已經上線，步入正軌。所以沒有什麼可以改變，因為這是之前預期的事情，我們將繼續做，所以不應該有任何與此相關的事情。然後，我們一直在討論的利潤和業績的可恢復性，以及未來幾個季度的定價和銷售成長，再次使我們能夠真正實現我們所說的我們正在做的事情。我們認為沒有理由改變我們迄今為止在股息支付方面所做的事情。馬克西莫，你可以選擇第二個。

Yeah. Leo, hello how are you? Yeah, the situation of prices, especially slabs, first of all, remember, Ternium is a net buyer of slabs. Ternium plus Usiminas is even greater. So it's not a bad thing, the prices of slabs. Ternium Brasil sends -- I mean, sells, if you can say this, everything to our own companies, either Usiminas or either Ternium Mexico or either Ternium Argentina. So we are not seeing a problem in the production of Ternium Brasil. As you know, Ternium Brasil is very efficient, so it can work at this level of prices. But again, for Ternium as a whole, we are a net buyer of slabs.

是的。利奧，你好，你好嗎？是的，價格情況，尤其是板坯，首先請記住，Ternium 是板坯的淨買家。 Ternium 加上 Usiminas 就更偉大了。因此，板材價格上漲並不是一件壞事。 Ternium Brasil 寄給我們自己的公司（Usiminas、Ternium Mexico 或 Ternium Argentina）（如果可以這麼說的話）所有東西。因此，我們在 Ternium Brasil 的生產中沒有看到問題。如您所知，Ternium Brasil 非常高效，因此可以在這個價格水平上運作。但同樣，對於整個 Ternium 來說，我們是板坯的淨買家。

Rodolfo Angele.

魯道夫·安傑萊.

Hi. Thanks, everyone. Just wanted to confirm that the overall message from the call in terms of outlook was that things are bottoming, prices should be getting better in North America. But in the guidance in the release, you mentioned EBITDA weaker into the next quarter. So I know there's a bit of a timing difference, but I just wonder if you could comment on this with a bit more details. That's all. Thank you.

你好。感謝大家。只是想確認一下，就前景而言，電話會議傳達的整體訊息是，情況正在觸底，北美的價格應該會變得更好。但在發布的指引中，您提到 EBITDA 會在下個季度走弱。所以我知道有一點時間上的差異，但我只是想知道你是否可以對此發表更多細節的評論。就這樣。謝謝。

Well, yeah, I start and then Pablo, but yeah, the message -- Rodolfo, you are right. Next quarter -- the outlook we did -- we gave for the next quarter is the one that you just recalled. Prices should decrease, especially in Mexico, because of the contract prices; not the spot prices, but the contract prices, the lag in the contract prices. So our price overall will see probably an increase in spot prices from the ones we have in July -- in June, sorry -- no, June and July. But overall, in the quarter, prices, because of the industrial prices, are going to be down. Volume in Mexico, a little bit higher, and then an increase in volume from Argentina and a little bit from Brazil. Overall, the outlook is a decrease in the EBITDA regarding the second quarter. And we are seeing that this is the bottom and an increase following this bottom.

嗯，是的，我先開始，然後是巴勃羅，但是，是的，我要傳達的訊息是－－魯道夫，你是對的。下個季度——我們所做的展望——我們對下個季度的展望是你剛剛回憶起來的。由於合約價格，價格應該會下降，特別是在墨西哥；不是現貨價格，而是合約價格，合約價格的滯後性。因此，我們的整體價格可能會比 7 月（6 月，抱歉，不，是 6 月和 7 月）的現貨價格上漲。但總體而言，由於工業價格的影響，本季價格將會下降。墨西哥的成交量略有增加，然後阿根廷和巴西的成交量有所增加。總體而言，第二季 EBITDA 的預期將下降。我們看到這是底部以及底部之後的成長。

Yeah. Let me -- Rodolfo, it's Pablo. Let me add to what just Maximo said that we will also be continuing to see certain level of cost that will be reflecting the purchased slabs and the purchased raw material in the past. So it's still reflecting higher prices than what we are seeing today. That's why when we mentioned that the fourth quarter should start to reflect a better scenario for Ternium, reflecting not only the price increases that we are seeing right now, but also a reduction in cost that we are also seeing. It was mentioned also over here that iron ore is going down. Coal prices are going down. So prices are also reducing for raw materials. We will not see that yet fully during the third quarter. This is more for the fourth quarter and yearend. But we always like to look at a longer period than a quarter because usually, you could have the lag and the timing difference on the cost of the prices, and this could lead to that. But in general, yes, we are clearly seeing the bottom during the third quarter and a recovery in the fourth and entering into next year.

是的。讓我——魯道夫，我是巴勃羅。讓我補充一下馬克西莫所說的，我們也將繼續看到一定程度的成本，這將反映過去購買的板坯和購買的原材料。因此，它仍然反映出比我們今天看到的價格更高的價格。這就是為什麼當我們提到第四季度應該開始反映出 Ternium 更好的情況時，不僅反映了我們現在看到的價格上漲，而且還反映了我們也看到的成本下降。這裡也提到鐵礦石價格正在下跌。煤炭價格正在下降。因此，原物料價格也在下降。我們在第三季還不會完全看到這一點。這更多的是第四季和年底的情況。但我們總是喜歡關注比季度更長的時期，因為通常情況下，價格成本可能存在滯後和時間差異，這可能會導致這種情況。但總的來說，是的，我們清楚地看到第三季觸底，第四季開始復甦並進入明年。

And there are no further questions at this time. I will now turn the call back over to the CEO.

目前沒有其他問題。我現在將把電話轉回給執行長。

Thank you and thank you to all. We appreciate your participation on this call and all the questions you asked. We welcome any feedback you may have. So thank you again and have a nice day. Bye-bye.

謝謝你們，也謝謝大家。我們感謝您參與本次電話會議以及您提出的所有問題。我們歡迎您提出任何回饋。再次感謝您，祝您有美好的一天。再見。

And this concludes today's conference call. You may now disconnect.

今天的電話會議到此結束。您現在可以斷開連線。