GRUPO SIMEC ANNOUNCES RESULTS OF OPERATIONS FOR THE FIRST QUARTER, OF 2025, ENDED MARCH 31, 2025

Core Insights - Grupo Simec reported a decrease in net sales and net income for the first quarter of 2025 compared to the same period in 2024, primarily due to lower sales prices and shipment volumes [2][13]. Financial Performance - Net Sales: Decreased from Ps. 7,885 million in Q1 2024 to Ps. 7,783 million in Q1 2025, with a 1% decrease in steel finished goods shipments [2]. - Cost of Sales: Decreased from Ps. 5,876 million in Q1 2024 to Ps. 5,786 million in Q1 2025, representing 74% of net sales in Q1 2025 compared to 75% in Q1 2024 [3]. - Gross Profit: Decreased by 1% from Ps. 2,009 million in Q1 2024 to Ps. 1,997 million in Q1 2025, with gross profit as a percentage of net sales increasing from 25% to 26% [4]. - Operating Income: Slight increase from Ps. 1,419 million in Q1 2024 to Ps. 1,426 million in Q1 2025, maintaining an operating income percentage of 18% [7]. - EBITDA: Increased from Ps. 1,668 million in Q1 2024 to Ps. 1,692 million in Q1 2025 [8]. - Net Income: Decreased from Ps. 1,456 million in Q1 2024 to Ps. 1,305 million in Q1 2025 [9][13]. Expense Analysis - General, Selling, and Administrative Expenses: Increased by 6% from Ps. 595 million in Q1 2024 to Ps. 633 million in Q1 2025, representing 8% of net sales for both periods [5]. - Comprehensive Financial Cost: Net income from comprehensive financial activities decreased from Ps. 147 million in Q1 2024 to Ps. 57 million in Q1 2025, with an exchange loss of Ps. 156 million recorded in Q1 2025 [11][24]. Comparative Analysis - Q1 2025 vs. Q4 2024: Net sales decreased by 12% from Ps. 8,830 million in Q4 2024 to Ps. 7,783 million in Q1 2025, with a significant drop in sales outside Mexico by 21% [15]. - Cost of Sales: Decreased by 22% from Ps. 7,408 million in Q4 2024 to Ps. 5,786 million in Q1 2025, with the cost of sales as a percentage of net sales improving from 84% to 74% [16]. - Gross Profit: Increased from Ps. 1,422 million in Q4 2024 to Ps. 1,997 million in Q1 2025, with gross profit as a percentage of net sales rising from 16% to 26% [17]. - Operating Income: Increased by 66% from Ps. 861 million in Q4 2024 to Ps. 1,426 million in Q1 2025 [21]. - Net Income: Decreased from Ps. 1,901 million in Q4 2024 to Ps. 1,305 million in Q1 2025 [26].