GRUPO SIMEC ANNOUNCES RESULTS OF OPERATIONS FOR THE TWELVE-MONTH PERIOD ENDED DECEMBER 31, 2024 AUDITED.

Core Insights - Grupo Simec reported a significant decrease in net sales by 18% for the twelve-month period ended December 31, 2024, compared to the same period in 2023, primarily due to reduced shipments and lower average sales prices [2][37] - Despite the decline in sales, the company achieved a remarkable increase in net income, rising by 145% to Ps. 10,488 million in 2024 from Ps. 4,283 million in 2023 [13][37] Financial Performance - Net Sales: Decreased from Ps. 41,139 million in 2023 to Ps. 33,658 million in 2024, with shipments of finished steel products down 6% [2][37] - Cost of Sales: Reduced by 16% from Ps. 31,100 million in 2023 to Ps. 26,033 million in 2024, with the average cost of finished steel produced decreasing by 11% [3][37] - Gross Profit: Declined from Ps. 10,039 million in 2023 to Ps. 7,625 million in 2024, representing 23% of net sales in 2024 compared to 24% in 2023 [4][37] - Operating Income: Fell by 30% from Ps. 7,603 million in 2023 to Ps. 5,301 million in 2024, accounting for 16% of net sales in 2024 [7][37] - EBITDA: Decreased by 26% from Ps. 8,638 million in 2023 to Ps. 6,367 million in 2024 [8][37] Expenses and Income - Operating Expenses: Increased by 12% from Ps. 2,317 million in 2023 to Ps. 2,603 million in 2024, representing 8% of net sales in 2024 [5][37] - Other Income (Expenses): Shifted from net expenses of Ps. 119 million in 2023 to net income of Ps. 279 million in 2024 [6][37] - Income Taxes: Increased from Ps. 1,740 million in 2023 to Ps. 2,060 million in 2024 [12][37] Quarterly Performance - Fourth Quarter Net Sales: Increased by 3% from Ps. 8,549 million in Q3 2024 to Ps. 8,830 million in Q4 2024, with total sales outside Mexico rising by 19% [15][37] - Fourth Quarter Gross Profit: Decreased by 34% to Ps. 1,422 million compared to Ps. 2,156 million in Q3 2024 [17][37] - Fourth Quarter Operating Income: Declined to Ps. 861 million from Ps. 1,524 million in Q3 2024 [20][37] - Fourth Quarter Net Income: Reported at Ps. 1,901 million, down from Ps. 3,152 million in Q3 2024 [25][37] Comparative Analysis - Year-over-Year Sales: Total sales in Mexico decreased by 25% from Ps. 24,325 million in 2023 to Ps. 18,270 million in 2024, while total sales outside Mexico decreased by 8% [2][37] - Cost of Sales Comparison: Increased by 9% from Ps. 6,795 million in Q4 2023 to Ps. 7,408 million in Q4 2024 [26][37] - Net Income Comparison: Increased significantly from Ps. 462 million in Q4 2023 to Ps. 1,901 million in Q4 2024 [36][37]