Financial Data and Key Metrics Changes - The company reported an EBITDA of BRL 2.6 billion with a margin of 23.5%, reflecting a 5% increase and a 1.4 percentage point expansion compared to Q1 2025 [5] - Gross debt was reduced by BRL 5.7 billion year-to-date, with a reduction of BRL 2.1 billion in the current quarter, leading to a leverage ratio decrease from 3.33x to 3.24x [5][12][13] Business Line Data and Key Metrics Changes - **Mining**: Achieved second highest sales volume in history, but EBITDA dropped by 36% due to falling iron ore prices [6][20] - **Steel**: Despite a 11.5% drop in sales volume, EBITDA increased by 79% year-on-year, with a margin of 10.08% [10][18] - **Cement**: Sales volume grew by 8% quarter-on-quarter, with a 10% increase in net revenue compared to Q1 2025, resulting in an EBITDA margin of 24% [8][23] - **Logistics**: Achieved a record EBITDA of BRL 519 million with a margin of 41.4% [9][24] Market Data and Key Metrics Changes - The steel market faced significant competition from imported materials, leading to a loss of market share for the company [16][33] - The company noted a 40-50% penetration of imported products in certain segments, particularly in tinplate and prepainted products [56][81] Company Strategy and Development Direction - The company is focusing on operational excellence, cost reduction, and enhancing productivity across all segments [31][84] - A strategy prioritizing value over volume in the steel segment has been adopted to improve profitability despite market challenges [7][57] - The company is actively seeking partnerships in infrastructure to reduce leverage and improve cash flow [42][46] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns over the chaotic influx of imported products affecting the domestic market and emphasized the need for government intervention [33][81] - The company remains optimistic about demand in Brazil, projecting a recovery in steel production and profitability in the coming quarters [58][60] Other Important Information - The company is committed to ESG initiatives, reporting a 30% reduction in occupational health and safety incidents compared to 2020 [26] - The company is also focusing on decarbonization efforts, achieving an 11% reduction in GHG emissions compared to the baseline year 2020 [28] Q&A Session Summary Question: Details on potential infrastructure partner and Usiminas stake sale - The company is in discussions regarding infrastructure assets, with potential liquidity injection of BRL 8 billion and has not yet defined the next steps for the Usiminas stake sale [42][46] Question: Impact of recent dumping decisions on margins - The company highlighted ongoing issues with imports and the need for government action on anti-dumping measures, while maintaining a focus on product diversification and higher value products [50][57] Question: Measures for cost efficiency in steel production - The company has implemented changes in production processes and is optimistic about cost reductions in the second half of the year [62][65] Question: Expectations for CapEx flexibility and asset sales - The company aims to maintain a lower CapEx focus while exploring asset monetization opportunities, including energy partnerships [66][68] Question: Long steel market dynamics and government conversations - The company noted a decline in long steel sales and emphasized the need for protective measures against imports to stabilize the market [72][78]

Core Viewpoint - Tenaris S.A. reported its financial results for the second quarter of 2025, showing a sequential increase in net sales and operating income compared to the first quarter of 2025, but a decline compared to the same quarter in 2024 [2][3][4]. Financial Performance - Net sales for Q2 2025 were $3,086 million, a 6% increase from Q1 2025 but a 7% decrease from Q2 2024 [3][4]. - Operating income rose to $583 million in Q2 2025, up 6% sequentially and 14% year-on-year [3][4]. - Net income for Q2 2025 was $542 million, reflecting a 5% increase from Q1 2025 and a 56% increase from Q2 2024 [3][4]. - EBITDA for Q2 2025 was $733 million, a 5% increase from Q1 2025 and a 13% increase from Q2 2024 [3][4]. Segment Analysis - Tubes segment net sales increased 6% sequentially to $2,920 million but decreased 7% year-on-year [9][10]. - Seamless pipe sales volume was 803 thousand metric tons in Q2 2025, a 4% increase from Q1 2025, while welded pipe sales volume decreased by 16% [9][10]. - North America saw a 13% increase in net sales for the Tubes segment compared to Q1 2025, driven by higher OCTG prices [9][10]. Cash Flow and Liquidity - Free cash flow for Q2 2025 was $538 million, with a net cash position of $3.7 billion as of June 30, 2025 [5][18]. - Cash generated from operating activities was $673 million in Q2 2025, down from $821 million in Q1 2025 [17][18]. Market Outlook - Oil prices have softened due to OPEC+ production cuts and subdued demand growth amid economic uncertainty [6][7]. - U.S. OCTG imports are expected to decline due to increased tariffs, which may lead to higher prices over time [7]. Operational Efficiency - Selling, general and administrative expenses (SG&A) were $484 million, representing 15.7% of net sales in Q2 2025, slightly up from 15.6% in Q1 2025 [12]. - Operating working capital days were 128 days as of June 30, 2025, compared to 129 days in the previous year [53].

Financial Data and Key Metrics Changes - Adjusted EBITDA increased by 25% in the second quarter, primarily driven by stronger realized steel prices in Mexico, partially offset by a slight increase in cost per ton [14] - Net income for the second quarter amounted to $259 million, including a $40 million provision adjustment related to ongoing litigation [15] - Adjusted net income, excluding the provision, was $299 million, supported by better operational performance and favorable deferred tax results due to a 7.5% revaluation of the Mexican peso [15] Business Line Data and Key Metrics Changes - Shipments in the steel segment declined primarily in Mexico and the U.S., partially mitigated by higher volumes in the southern region [16] - Iron ore shipments rose quarter over quarter driven by increased production levels, although net sales remained broadly unchanged due to lower realized prices [18] Market Data and Key Metrics Changes - The Mexican market is experiencing a cautious business environment, with government measures contributing to a decrease in steel imports, creating a more level playing field [6][8] - The Brazilian steel market faces significant challenges due to a surge of unfair imported steel, particularly from China, undermining local competitiveness [8] - Argentina saw a significant increase in shipments during the second quarter, driven by seasonal factors and a recovering macroeconomic environment [9] Company Strategy and Development Direction - The company is focused on reducing costs to strengthen competitiveness, with ongoing initiatives aimed at optimizing production processes and supply chains [10][11] - The expansion project in Pesqueria is a cornerstone of the company's growth strategy, with expectations of increased shipments in Mexico [8][10] - The company is committed to sustainable industrial development, as highlighted in their sustainable report [11] Management's Comments on Operating Environment and Future Outlook - The operating environment remains uncertain and volatile, with expectations of a sequential improvement in the third quarter, particularly in Mexico [4][5] - Management is optimistic about ongoing negotiations between the U.S. and Mexico leading to mutually beneficial agreements [7] - The company anticipates a mixed performance across key markets, with growth expected in Mexico and steady shipments in Argentina, while Brazil continues to face headwinds [17] Other Important Information - Cash from operations totaled $1 billion in the second quarter, aided by a significant reduction in working capital [19] - The company’s net cash position decreased primarily due to elevated capital expenditures and dividend distributions, but remains solid at $1 billion [20] Q&A Session Summary Question: Can you elaborate on the state of steel supply in Mexico? - Management indicated that recent trade measures have led to lower imports, and they expect to gain market share due to these developments [22][23][25] Question: What is the outlook for cost reduction initiatives? - Management expects a total of $300 million in cost efficiency improvements for the year, with various initiatives contributing to this target [29][61] Question: What is the expected improvement in EBITDA? - Management anticipates reaching an average EBITDA margin closer to 15% by the fourth quarter, supported by cost reduction measures [40][41] Question: What is the status of the CSN litigation? - The litigation remains pending, with an appeal filed and awaiting a decision from the Supreme Court of Justice in Brazil [50][52] Question: What are the plans for capital allocation and dividends? - The company plans to sustain dividend payments while managing significant capital expenditures, with a peak expected this quarter [71][75]

Financial Data and Key Metrics Changes - Ternium's adjusted EBITDA increased by 25% in Q2 2025, primarily driven by stronger realized steel prices in Mexico, despite a slight increase in cost per ton [15][16] - Net income for Q2 2025 amounted to $259 million, including a $40 million provision adjustment related to ongoing litigation, with adjusted net income excluding this provision at $299 million [16][22] - Cash from operations totaled $1 billion in Q2 2025, supported by a significant reduction in working capital [21][22] Business Line Data and Key Metrics Changes - Shipments in the steel segment declined primarily in Mexico and the U.S., partially mitigated by higher volumes in the southern region [17][18] - Iron ore shipments rose quarter over quarter due to increased production levels, although net sales remained broadly unchanged due to lower realized prices [20] Market Data and Key Metrics Changes - The Mexican steel market is experiencing a cautious environment with pending clarity on U.S. trade policy, while the Brazilian market faces challenges from a surge in unfair imported steel [6][8] - Argentina saw a significant increase in shipments during Q2 2025, driven by seasonal factors and a recovering macroeconomic environment [10] Company Strategy and Development Direction - Ternium is focused on reducing costs to strengthen competitiveness, with ongoing initiatives aimed at optimizing production processes and supply chains [11][12] - The company is committed to its expansion project in Pesqueria, which is seen as a cornerstone of its growth strategy [7][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in a sequential improvement in shipments for Q3 2025, particularly in Mexico, supported by government measures against unfair trade practices [6][18] - The operating environment remains uncertain and volatile, with management emphasizing the need for concrete measures to defend the Brazilian industrial base [9][10] Other Important Information - Ternium released a sustainable report reaffirming its commitment to long-term value creation through sustainable industrial development [12] - The company anticipates a peak in capital expenditures (CapEx) in Q2 2025, with projections for a decrease in the following quarters [73][74] Q&A Session Summary Question: State of steel supply in Mexico - Management indicated that recent trade measures have led to lower imports, which may help rebalance the steel market, and Ternium is well-positioned to capture market share [25][30] Question: Cost outlook and reduction initiatives - Management expects a $300 million decrease in cost efficiency for the year, with various initiatives contributing to this target [32][33] Question: Magnitude of potential EBITDA improvement - Management anticipates a recovery in EBITDA margins, aiming for around 15% by Q4 2025, supported by cost reduction measures [42][43] Question: Update on CSN litigation - There have been no significant developments in the CSN litigation, and the next steps involve awaiting a decision from the Supreme Court of Justice [52][53] Question: CapEx cycle and allocation strategy - Management confirmed that the peak of CapEx occurred in Q2 2025, with a projected decrease in the following quarters, while maintaining dividend payments [73][77]

Brazilian steelmaker Usiminas expressed concern that US President Donald Trump’s threatened 50% levy on the Latin American country will add more risks for its exporting customers https://t.co/jb4pAxsXYD ...

Financial Performance - Adjusted EBITDA increased, driven by enhanced margins and increased shipments of steel and iron ore[8] - In Q1 2025, net income includes a $45 million loss due to an adjustment for interest accrual and currency fluctuation related to the Usiminas acquisition litigation[15] - Mining net sales increased 13% sequentially, mainly driven by higher iron ore realized prices[28] Steel Segment - Steel shipments in Q1 2025 were 1.911 million tons, with Mexico accounting for 49.5%, Brazil 26.1%, Southern Region 12.7%, USA 6%, and other markets 11.7%[20, 21] - Steel shipments rose in Q1 2025, driven by increases in Brazil and the US markets, partially offset by a decrease in Mexico[24] - Steel revenue per ton decreased sequentially in most of Ternium's markets in Q1 2025[24] - Steel cash operating income per ton was $72/ton in Q1 2025 with a margin of 7%[23] Mining Segment - Mining shipments rose slightly sequentially to 3.059 million tons in Q1 2025, driven by higher production in Mexico and Brazil[26, 28] - Mining cash operating income per ton was $18/ton in Q1 2025 with a margin of 20%[26] - Margins declined in the 1Q25 due to higher production costs, partially offset by an increase in realized iron ore prices[27] Cash Flow and Balance Sheet - Net cash position decreased primarily due to cash outflows related to Ternium's capital expenditure program[33] - Capex in Q1 2025 was $518 million, mainly reflecting progress on the expansion projects at Ternium's Pesquería Industrial Center[32, 36]