Ternium S.A 6-K, filed Aug 2, 2023

Ternium S.A. (TX)

6-K 2023-08-02 For: 2023-06-30

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Added on April 07, 2026

About this 6-K

Ternium S.A filed this 6-K on August 2, 2023.

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By: /s/ Guillermo Etchepareborda						By:/s/ Sebastián Martí
Name: Guillermo Etchepareborda						Name: Sebastián Martí
Title: Attorney in Fact						Title: Attorney in Fact




TERNIUM S.A.
Consolidated Condensed Interim Financial Statements
as of June 30, 2023
and for the six-month periods
ended on June 30, 2023 and 2022



26 Boulevard Royal, 4th floor
L – 2449 Luxembourg
R.C.S. Luxembourg: B 98 668


		Page

Consolidated Condensed Interim Income Statements		2
Consolidated Condensed Interim Statements of Comprehensive Income		3
Consolidated Condensed Interim Statements of Financial Position		4
Consolidated Condensed Interim Statements of Changes in Equity		5
Consolidated Condensed Interim Statements of Cash Flows		7
Notes to the Consolidated Condensed Interim Financial Statements
1	General information and basis of presentation	8
2	Accounting policies	8
3	Segment information	9
4	Cost of sales	10
5	Selling, general and administrative expenses	11
6	Finance expense, Finance income and Other financial income (expenses), net	11
7	Property, plant and equipment, net	11
8	Intangible assets, net	12
9	Investments in non-consolidated companies	12
10	Distribution of dividends	15
11	Contingencies, commitments and restrictions on the distribution of profits	15
12	Related party transactions	17
13	Financial instruments by category and fair value measurement	18
14	Foreign exchange restrictions in Argentina	19
15	The Russia-Ukraine armed conflict	20
16	Ternium to integrate operations in the USMCA	21
17	Ternium to Increase its Participation in Usiminas Control Group - New Governance Structure of Usiminas	21


TERNIUM S.A.
Consolidated Condensed Interim Financial Statements as of June 30, 2023
and for the six-month periods ended June 30, 2023 and 2022
(All amounts in $ thousands)




		Three-month period ended June 30,		Six-month period ended June 30,
	Notes	2023	2022	2023	2022
		(Unaudited)		(Unaudited)
Net sales	3	3,871,272	4,437,676	7,494,643	8,742,505
Cost of sales	4	(2,839,419)	(3,058,908)	(5,820,170)	(6,043,093)

Gross profit		1,031,853	1,378,768	1,674,473	2,699,412

Selling, general and administrative expenses	5	(304,271)	(310,444)	(597,195)	(591,747)
Other operating income, net		4,159	2,828	11,853	22,502

Operating income	3	731,741	1,071,152	1,089,131	2,130,167

Finance expense	6	(17,542)	(7,313)	(33,742)	(13,935)
Finance income	6	42,033	15,636	83,479	39,953
Other financial (expense) income, net	6	(42,481)	28,856	(59,900)	(49,711)

Equity in earnings of non-consolidated companies	9	27,301	49,273	62,176	108,022

Profit before income tax credit (expense)		741,052	1,157,604	1,141,144	2,214,496

Income tax credit (expense)		(5,169)	(221,419)	74,259	(400,793)

Profit for the period		735,883	936,185	1,215,403	1,813,703

Attributable to:
Owners of the parent		626,930	799,270	1,001,304	1,574,891
Non-controlling interest		108,953	136,915	214,099	238,812

Profit for the period		735,883	936,185	1,215,403	1,813,703

Weighted average number of shares outstanding		1,963,076,776	1,963,076,776	1,963,076,776	1,963,076,776

Basic and diluted earnings per share for profit attributable to the equity holders of the company (expressed in $ per share)		0.32	0.41	0.51	0.80


		Balances as of
	Notes	June 30, 2023		December 31, 2022
		(Unaudited)
ASSETS

Non-current assets
Property, plant and equipment, net	7	6,324,307		6,261,887
Intangible assets, net	8	968,124		944,409
Investments in non-consolidated companies	9	938,998		821,571
Other investments		102,931		100,716

Deferred tax assets		348,858		200,237
Receivables, net		409,351	9,092,569	318,690	8,647,510


Current assets
Receivables, net		719,446		662,762
Derivative financial instruments		—		227
Inventories, net		3,758,603		3,470,215
Trade receivables, net		1,412,260		1,180,689
Other investments		2,031,761		1,875,026
Cash and cash equivalents		920,404	8,842,474	1,653,355	8,842,274

Non-current assets classified as held for sale			1,764		1,764

			8,844,238		8,844,038

Total Assets			17,936,807		17,491,548

EQUITY
Capital and reserves attributable to the owners of the parent			12,386,634		11,845,959

Non-controlling interest			1,922,933		1,922,434

Total Equity			14,309,567		13,768,393

LIABILITIES

Non-current liabilities
Provisions		84,891		81,422
Deferred tax liabilities		25,271		162,742
Other liabilities		603,186		538,214
Trade payables		1,314		1,112

Lease liabilities		179,428		190,134
Borrowings		514,521	1,408,611	532,701	1,506,325

Current liabilities
Current income tax liabilities		108,480		135,703
Other liabilities		350,226		344,843
Trade payables		1,321,932		1,187,600
Derivative financial instruments		14,044		505
Lease liabilities		46,114		49,015
Borrowings		377,833	2,218,629	499,164	2,216,830

Total Liabilities			3,627,240		3,723,155

Total Equity and Liabilities			17,936,807		17,491,548


	Attributable to the owners of the parent (1)
	Capital stock (2)	Treasury shares (2)	Initial public offering expenses	Reserves (3)	Capital stock issue discount (4)	Currency translation adjustment	Retained earnings	Total	Non-controlling interest	Total Equity


Balance as of January 1, 2023	2,004,743	(150,000)	(23,295)	1,394,567	(2,324,866)	(2,859,068)	13,803,878	11,845,959	1,922,434	13,768,393

Profit for the period							1,001,304	1,001,304	214,099	1,215,403
Other comprehensive income (loss) for the period
Currency translation adjustment						60,495		60,495	5,355	65,850
Remeasurement of post employment benefit obligations				(7,544)				(7,544)	(568)	(8,112)

Others (5)				(160,226)				(160,226)	15,151	(145,075)

Total comprehensive income (loss) for the period	—	—	—	(167,770)	—	60,495	1,001,304	894,029	234,037	1,128,066

Dividends paid in cash (6)							(353,354)	(353,354)	—	(353,354)
Dividends paid in kind to non-controlling interest								—	(233,538)	(233,538)




Balance as of June 30, 2023 (unaudited)	2,004,743	(150,000)	(23,295)	1,226,797	(2,324,866)	(2,798,573)	14,451,828	12,386,634	1,922,933	14,309,567


TERNIUM S.A.
Consolidated Condensed Interim Financial Statements as of June 30, 2023
and for six-month periods ended June 30, 2023 and 2022
(All amounts in $ thousands)


	Six-month period ended June 30, 2023 (Unaudited)
	Steel	Mining	Inter-segment eliminations	Total

Operating income - Management view	1,117,369	(30,944)	(8,880)	1,077,545
Reconciliation:
Differences in Cost of sales				11,586

Operating income - Under IFRS				1,089,131

Financial income (expense), net				(10,163)
Equity in earnings (losses) of non-consolidated companies				62,176

Income before income tax expense - IFRS				1,141,144

Net sales from external customers	7,494,547	96	—	7,494,643
Net sales from transactions with other operating segments of the same entity	—	194,770	(194,770)	—

Depreciation and amortization	(252,500)	(48,999)	—	(301,499)

	Six-month period ended June 30, 2022 (Unaudited)
	Steel	Mining	Inter-segment eliminations	Total

Operating income - Management view	1,474,243	21,311	6,061	1,501,615
Reconciliation:
Differences in Cost of sales				628,552

Operating income - Under IFRS				2,130,167

Financial income (expense), net				(23,693)
Equity in earnings (losses) of non-consolidated companies				108,022

Income before income tax expense - IFRS				2,214,496

Net sales from external customers	8,742,442	63	—	8,742,505
Net sales from transactions with other operating segments of the same entity	—	213,490	(213,490)	—

Depreciation and amortization	(260,608)	(42,286)	—	(302,894)


	Six-month period ended June 30, 2023 (Unaudited)
	Mexico	Southern region	Brazil and other markets	Total

Net sales	4,713,028	1,738,048	1,043,567	7,494,643

Non-current assets (1)	4,859,342	870,248	1,562,841	7,292,431

	Six-month period ended June 30, 2022 (Unaudited)
	Mexico	Southern region	Brazil and other markets	Total

Net sales	4,779,293	1,892,019	2,071,193	8,742,505

Non-current assets (1)	4,767,553	860,474	1,695,154	7,323,181

(1) Includes Property, plant and equipment and Intangible assets.


Company	Country of incorporation	Main activity	Voting rights as of		Value as of
			June 30, 2023	December 31, 2022	June 30, 2023	December 31, 2022


Usinas Siderurgicas de Minas Gerais S.A. - USIMINAS	Brazil	Manufacturing and selling of steel products	34.39%	34.39%	827,141	725,705
Techgen S.A. de C.V.	Mexico	Provision of electric power	48.00%	48.00%	106,803	90,559
Other non-consolidated companies (1)					5,054	5,307
					938,998	821,571


Value of investment						USIMINAS

As of January 1, 2023						725,705
Share of results (1)						46,158
Other comprehensive income (2)						55,278




As of June 30, 2023						827,141

(1) It includes the adjustment of the values associated to the purchase price allocation.
(2) It includes mainly the effect of the currency translation adjustment.


Usiminas' shareholders' equity	4,919,866
Percentage of interest of the Company over shareholders' equity	20.40	%

Interest of the Company over shareholders' equity	1,003,324

Purchase price allocation	61,345
Goodwill	215,686
Impairment	(453,214)


Total Investment in Usiminas	827,141


						USIMINAS
Summarized balance sheet (in million $)						As of June 30, 2023
Assets
Non-current						4,312
Current						2,908
Other current investments						247
Cash and cash equivalents						778

Total Assets						8,245
Liabilities
Non-current						600
Non-current borrowings						1,198
Current						964
Current borrowings						27

Total Liabilities						2,789

Non-controlling interest						536

Shareholders' equity						4,920



Summarized income statement (in million $)						Six-month period ended June 30, 2023

Net sales						2,788
Cost of sales						(2,500)
Gross Profit						288
Selling, general and administrative expenses						(109)
Other operating income (loss), net						(70)
Operating income						109
Financial income (expenses), net						79
Equity in earnings of associated companies						21
Profit before income tax						209
Income tax expense						(46)
Net profit before non-controlling interest						163
Non-controlling interest in other subsidiaries						(20)
Net profit for the period						143


	Six-month period ended June 30,
	2023	2022
	(Unaudited)

Inventories at the beginning of the year	3,470,214	3,908,305




Plus: Charges for the period
Raw materials and consumables used and other movements	5,002,579	5,504,178
Services and fees	99,133	86,242
Labor cost	397,802	477,049
Depreciation of property, plant and equipment	260,729	263,829
Amortization of intangible assets	18,923	19,591
Maintenance expenses	341,107	310,841
Office expenses	6,180	4,503
Valuation allowance	(15,333)	—
Insurance	7,762	7,692
Change of obsolescence allowance	(478)	12,140
Recovery from sales of scrap and by-products	(21,102)	(21,213)
Others	11,257	10,367

Less: Inventories at the end of the period	(3,758,603)	(4,540,431)

Cost of Sales	5,820,170	6,043,093


	Six-month period ended June 30,
	2023	2022
	(Unaudited)
Services and fees	40,224	37,091
Labor cost	156,460	160,898
Depreciation of property, plant and equipment	7,484	6,783
Amortization of intangible assets	14,363	12,691
Maintenance and expenses	4,095	4,634
Taxes	79,436	85,183
Office expenses	25,854	20,485
Freight and transportation	244,211	260,347
Increase of allowance for doubtful accounts	12,294	486
Others	12,774	3,149

Selling, general and administrative expenses	597,195	591,747


	Six-month period ended June 30,
	2023	2022
	(Unaudited)
At the beginning of the year	6,261,887	6,431,578


Currency translation differences	1,501	282
Additions	340,326	245,665
Value adjustments of lease contracts	5,926	15,919
Disposals	(17,180)	(13,446)
Depreciation charge	(268,213)	(270,612)
Capitalized borrowing costs	—	403
Transfers and reclassifications	60	(2,193)


At the end of the period	6,324,307	6,407,596



As of June 30, 2023 (in $ thousands)	Amortized cost	Assets at fair value through profit or loss	Assets at fair value through OCI	Total

(i) Assets as per statement of financial position
Receivables	191,008	—	—	191,008

Trade receivables	1,412,260	—	—	1,412,260
Other investments	788,414	65,769	1,280,353	2,134,536
Cash and cash equivalents	527,961	330,550	61,893	920,404

Total	2,919,643	396,319	1,342,246	4,658,208

As of June 30, 2023 (in $ thousands)	Amortized cost	Liabilities at fair value through profit or loss		Total

(ii) Liabilities as per statement of financial position
Other liabilities	71,997	—		71,997
Trade payables	1,262,511	—		1,262,511
Derivative financial instruments	—	14,044		14,044
Lease liabilities	225,542	—		225,542
Borrowings	892,354	—		892,354

Total	2,452,404	14,044		2,466,448


	Fair value measurement as of June 30, 2023 (in $ thousands):
Description	Total	Level 1	Level 2	Level 3

Financial assets at fair value through profit or loss / OCI
Cash and cash equivalents	392,443	392,443	—	—
Other investments	1,346,122	1,233,877	87,397	24,848


Total assets	1,738,565	1,626,320	87,397	24,848

Financial liabilities at fair value through profit or loss / OCI
Derivative financial instruments	14,044	—	14,044	—

Total liabilities	14,044	—	14,044	—


	Fair value measurement as of December 31, 2022 (in $ thousands):
Description	Total	Level 1	Level 2	Level 3 (*)

Financial assets at fair value through profit or loss / OCI
Cash and cash equivalents	772,953	772,953	—	—
Other investments	1,492,281	1,283,284	164,980	44,017
Derivative financial instruments	227	—	227	—

Total assets	2,265,461	2,056,237	165,207	44,017

Financial liabilities at fair value through profit or loss / OCI
Derivative financial instruments	505	—	505	—

Total liabilities	505	—	505	—