Financial Data and Key Metrics Changes - Ternium reported an EBITDA of $0.5 billion for Q1 2023, equivalent to $166 per ton and a 14% margin, with free cash flow of $414 million [4][14] - EBITDA, EBITDA margin, and EBITDA per ton improved sequentially, leading to earnings per ADS of $1.91 [14] - Cash flow from operations was $612 million, including a working capital release of $218 million, resulting in a net cash position of $3 billion by the end of March [19] Business Line Data and Key Metrics Changes - Steel shipments in Mexico reached a record 2.1 million tons in Q1 2023, a 30% increase compared to Q1 2022 [6][15] - Consolidated shipments for the quarter were 3.1 million tons, with expectations for increased shipments in Q2 2023 [16] - Shipments in the Southern Region decreased by 8% due to weaker demand in Argentina [15] Market Data and Key Metrics Changes - The Mexican market showed healthy apparent steel demand, particularly in the commercial sector, with ongoing restocking [5] - In Argentina, steel demand is expected to decrease by 2% to 3% for the entire year due to economic instability and high inflation [7][43] - The industrial real estate sector in Mexico has a national occupancy rate of 97%, indicating strong demand for industrial space [6] Company Strategy and Development Direction - Ternium is increasing its market share in the automotive industry and is advancing its certification process for new products [6] - The company is committed to Brazil, viewing it as a significant market for future growth opportunities [12] - Ternium is taking a more direct role in Usiminas management, aiming to unlock its potential and improve competitiveness [9][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in Ternium's performance for 2023 despite macroeconomic uncertainties, citing strong competitive positioning and ongoing investments [12] - The company anticipates robust demand in the second half of the year, with some concerns about potential impacts from rising interest rates [22][23] - Management noted that the new normal for steel prices is significantly higher than pre-pandemic levels, with expectations for stable pricing [32] Other Important Information - Ternium was recognized as sustainability champions by World Steel for the fifth consecutive year, reflecting its commitment to sustainable operations [10] - The company is launching a new technical school in Brazil to enhance education and technical training in the community [11] Q&A Session Summary Question: Demand conditions in North America and outlook for the second half of the year - Management indicated that shipments are expected to increase in Q2 2023, with robust demand anticipated to continue [22][23] Question: Usiminas transaction and future plans - Management refrained from elaborating on future plans for Usiminas until regulatory approval is obtained, but expressed optimism about its potential [26] Question: Working capital trends and price expectations for USHRC - Management expects an increase in working capital utilization due to anticipated growth in shipments and prices [34] - A new normal for steel prices is expected to stabilize around $900 to $1,000 per ton [32] Question: AMSA operations and potential restart - Management noted uncertainty regarding AMSA's restart and its potential impact on the market, but does not expect significant disruption [37] Question: Slab integration dynamics and Argentina's steel demand outlook - Slab integration is nearly 100%, with expectations of a decrease in steel consumption in Argentina by 2% to 3% for the year [43]