Core Insights - The article emphasizes the importance of identifying high-quality and mispriced investment opportunities, suggesting that great investment ideas should be intuitive and involve purchasing strong companies at favorable prices [1]. Group 1 - The focus is on the role of an investment analyst in uncovering valuable investment ideas that are not immediately apparent [1]. - The article highlights the belief that successful investments stem from a combination of quality companies and attractive pricing [1].

Group 1 - Ternium is a significant player in the Latin American industrial sector, not just a steel producer, with nearly twenty years of operational history [1] - The company has successfully integrated the entire steel production process, a feat that few in the sector have achieved [1]

Group 1 - Moretus Research provides high-quality equity research focused on U.S. public markets, aiming to deliver clarity, conviction, and alpha for serious investors [1] - The research framework identifies companies with durable business models, mispriced cash flow potential, and intelligent capital allocation, emphasizing a structured and repeatable approach [1] - Valuation methods are based on sector-relevant multiples tailored to each company's business model and capital structure, prioritizing comparability, simplicity, and relevance [1] Group 2 - Research coverage focuses on underappreciated companies experiencing structural changes or temporary dislocations, where disciplined analysis can yield asymmetric returns [1] - Moretus Research aims to elevate the standard for independent investment research by providing professional-grade insights and actionable valuation [1]

First Quarter of 2025 Adjusted EBITDA April 30, 2025 First Quarter of 2025 Earnings Conference Call and Webcast 1 / 25 Forward-Looking Statements and Non-IFRS Alternative Performance Measures This presentation contains certain forward-looking statements and information relating to Ternium S.A. and its subsidiaries (collectively, "Ternium") that are based on the current beliefs of its management as well as assumptions made by and information currently available to Ternium. Such statements reflect the current ...

Financial Performance - Net sales for the three-month period ended March 31, 2025, were $3,932,808 thousand, a decrease of 17.7% compared to $4,778,297 thousand in the same period of 2024[10] - Gross profit for the same period was $530,950 thousand, down 51.9% from $1,103,553 thousand year-over-year[10] - Operating income decreased to $131,826 thousand, a decline of 80.5% compared to $674,856 thousand in the prior year[10] - Profit for the period was $142,331 thousand, representing a 72.6% decrease from $491,431 thousand in the previous year[10] - Basic and diluted earnings per share for profit attributable to equity holders of the company were $0.03, down from $0.18 in the same period of 2024[10] - Total comprehensive income for the period was $405,027 thousand, a decrease of 45.6% compared to $744,542 thousand in the prior year[11] - Net cash provided by operating activities was $207.0 million, down from $475.5 million in the previous year[23] - Capital expenditures for the period were $517.8 million, compared to $449.2 million in the same quarter of 2024[23] - The company reported a net foreign exchange loss of $30,695 thousand in Q1 2025, compared to a gain of $41,008 thousand in Q1 2024[59] - For the three-month period ended March 31, 2025, revenues amounted to $462 million, a decrease of 11.8% compared to $524 million for the same period in 2024[91] - Net profit from continuing operations was $36 million, down 86.3% from $263 million in the prior year[91] Assets and Equity - Total assets as of March 31, 2025, were $23,715,575 thousand, an increase from $23,128,547 thousand at the end of 2024[12] - Total equity increased to $16,536,596 thousand from $16,131,569 thousand at the end of 2024[12] - As of March 31, 2025, total equity stood at $16.5 billion, an increase from $16.1 billion at the beginning of the year[14] - Property, plant and equipment increased to $8,803,071 thousand as of March 31, 2025, from $7,855,930 thousand at the end of Q1 2024, an increase of approximately 12%[60] - Total assets as of March 31, 2025, were $5,668 million, a slight decrease from $5,726 million as of December 31, 2024[91] - Total liabilities decreased to $689 million from $790 million as of December 31, 2024, reflecting a reduction of 12.8%[91] Usiminas Acquisition - The company reported a provision for ongoing litigation related to the acquisition of a participation in Usiminas amounting to $45,300 thousand for the current period[10] - The company increased its participation in Usiminas Control Group, indicating a strategic move towards market expansion[9] - As of June 30, 2023, Ternium owned 242.6 million ordinary shares of Usiminas, representing 34.4% of Usiminas' ordinary shares and 20.4% of its total share capital[32] - On July 3, 2023, Ternium completed the acquisition of 57.7 million ordinary shares of Usiminas for $118.7 million, increasing its participation in the Usiminas control group to 51.5%[35] - The fair value of net assets acquired from Usiminas amounted to $3,593.3 million, with significant assets including inventories valued at $1,707.3 million and property, plant, and equipment at $904.8 million[41] - Ternium recognized a loss of $441.4 million related to the remeasurement of its previously held interest in Usiminas, alongside a bargain purchase gain of $270.4 million, resulting in a net loss effect of $171.0 million[39] - The Usiminas control group, post-acquisition, holds 61.3% of the voting rights, with Ternium and NSC each nominating three members to the board of directors[36] - Ternium recognized non-controlling interests in Usiminas at $2,575.9 million, based on the proportionate share of the acquired net identifiable assets[45] - Provisions for contingencies recognized as part of the business combination totaled $856.2 million, including tax-related contingencies of $432.5 million[47] - Ternium has established a "put" and "call" option mechanism with the NSC group regarding their remaining shares in Usiminas, allowing for future transactions at specified prices[42] - The total purchase consideration for the acquisition was $118.7 million, with a significant portion allocated to the remeasurement of previously held interests[41] - Ternium began fully consolidating Usiminas' balance sheet and results of operations in its financial statements starting July 2023[37] Segment Performance - The Steel segment reported net sales of $3,801,118 thousand for the three-month period ended March 31, 2025, a decrease from $4,690,004 thousand in the same period of 2024, reflecting a decline of approximately 19%[54] - The Mining segment generated net sales of $131,690 thousand in Q1 2025, compared to $88,293 thousand in Q1 2024, indicating an increase of about 49%[54] - Operating income for the Steel segment in Q1 2025 was $243,546 thousand, significantly lower than $593,211 thousand in Q1 2024, a decline of about 59%[54] - The cost of sales for the three-month period ended March 31, 2025, was $3,401,858 thousand, down from $3,674,744 thousand in the same period of 2024, reflecting a decrease of approximately 7%[57] - Selling, general and administrative expenses decreased to $396,200 thousand in Q1 2025 from $431,166 thousand in Q1 2024, a reduction of about 8%[58] Legal and Tax Matters - Retained earnings included in the financial statements may not be wholly distributable due to Luxembourg law[16] - The estimated current tax expense related to OECD Pillar Two for the three-month period ended March 31, 2025, is $3.8 million, with a total provision of $25.3 million[68] - The potential indemnification amount related to the Usiminas acquisition could reach approximately $336.4 million, based on the latest court decisions[73] - Ternium Brasil has a commitment of approximately $106.2 million under a supply agreement with Petrobras S.A. due to terminate in February 2026[76] - The company recognized provisions for tax contingencies of $432,488 thousand as part of the business combination, up from $329,141 thousand previously[48] - Labor lawsuits related to the Cubatão Plant amounted to $57,343 thousand as of March 31, 2025, down from $34,459 thousand at the acquisition date[48] Shareholder Information - The company proposed an annual dividend of $0.27 per share, totaling approximately $530 million, which includes an interim dividend of $0.09 per share already paid[66] - As of March 31, 2025, Techint Holdings S.à r.l. indirectly owned 65.03% of the company's share capital, while Tenaris Investments S.à r.l. held 11.46%[79] Economic and Regulatory Environment - The company has significant foreign exchange restrictions in Argentina, impacting its operations and financial transactions[86] - Ternium Argentina's financial position in ARS included $341 million in monetary assets and $202 million in monetary liabilities as of March 31, 2025[94] - On February 1, 2025, the U.S. government announced tariffs on all products imported from Mexico, Canada, and China, with specific exemptions for USMCA-compliant products[96] - A 25% tariff was imposed on virtually all imports of steel and certain steel derivatives starting March 12, 2025, revoking previous exemptions[96] - Reciprocal tariffs with a minimum of 10% were announced on April 2, 2025, but Mexico and Canada were exempt from these tariffs[96] - A 25% tariff under Section 232 on all imported automobiles produced outside the U.S. was confirmed on April 2, 2025, affecting only non-U.S. specific content[96] - Other countries have announced retaliatory tariffs against U.S. exports, creating uncertainties for Ternium[97] - Ternium is currently unable to predict the impact of the new tariffs on its business or financial condition due to these uncertainties[97]

Financial Data and Key Metrics Changes - Ternium reported a sequential increase in EBITDA driven by improved margins and slightly higher shipments [6] - Net income for Q1 2025 stood at $142 million, including a $45 million provision adjustment charge related to ongoing litigation [18] - Adjusted net income, excluding the major charge, was $188 million, marking a significant improvement over the prior quarter [19] Business Line Data and Key Metrics Changes - The steel segment saw higher shipments in Brazil and other markets, partially offset by lower sales volumes in Mexico [19] - Mining segment shipments increased slightly quarter over quarter and rose 14% year over year, driven by higher production levels in Mexico and Brazil [22] Market Data and Key Metrics Changes - In Mexico, apparent consumption of steel decreased almost 5% in 2024, affecting demand [30] - Brazilian trade authorities reported a significant year-over-year increase in imports during Q1 2025, with ongoing anti-dumping investigations on imports from China [9] Company Strategy and Development Direction - The company aims to enhance competitiveness by increasing operational efficiency and reducing costs amid a challenging trade environment [10] - Ternium's expansion project in Mexico has a revised total CapEx of $4 billion, representing a 16% increase compared to previous estimates [12] - The company expects to achieve a double-digit EBITDA margin in Q2 2025, supported by increased realized prices and cost reduction initiatives [11] Management's Comments on Operating Environment and Future Outlook - Management noted that trade tensions and uncertainty are impacting global economic growth, but there is optimism regarding the Plan Mexico initiative to enhance industrialization [6][8] - The outlook for the steel sector in Argentina is improving, with expectations of a 20% increase in shipments in the upcoming quarters [56] Other Important Information - The company maintains a strong balance sheet with a net cash position of $1.3 billion as of March 2025 [23] - Ternium's CapEx for 2025 is projected to be around $2.5 billion, with significant investments in ongoing projects [23] Q&A Session Summary Question: Situation in Mexico and GDP impact - Management acknowledged the challenging environment in Mexico, with expectations for demand to improve in the following quarters, particularly in the commercial market [30][31] Question: Margins and profitability outlook - Management indicated that margins are expected to improve in Q2 2025, with a potential return to more reasonable levels compared to previous quarters [37][38] Question: Cost reduction and volume growth opportunities - Management confirmed ongoing cost reduction programs and highlighted the potential for volume growth in Mexico due to decreased imports [41][45] Question: Cash returns and dividend payments - Management expressed confidence in sustaining dividend payments despite ongoing CapEx plans, citing a solid financial position [54] Question: Argentina's steel sector outlook - Management noted improvements in Argentina's steel sector, with expectations for increased shipments and no immediate plans for capacity expansion [56] Question: CapEx increase reasons and timeline - Management explained that the CapEx increase was due to higher construction costs and inflation, with the additional costs expected to be distributed over the project timeline [64]

Financial Data and Key Metrics Changes - Ternium reported a net income of $142 million for Q1 2025, which includes a $45 million provision adjustment charge related to ongoing litigation [16] - Adjusted net income, excluding the major charge, was $188 million, marking a significant improvement over the prior quarter [16] - The company anticipates achieving a double-digit EBITDA margin in Q2 2025, supported by increased realized prices in Mexico and cost reduction initiatives [9][10] Business Line Data and Key Metrics Changes - The steel segment saw higher shipments in Brazil and other markets, partially offset by lower sales volumes in Mexico [17] - Mining segment shipments increased slightly quarter-over-quarter and rose 14% year-over-year, driven by higher production levels in Mexico and Brazil [20] Market Data and Key Metrics Changes - In Mexico, apparent consumption of steel decreased almost 5% in 2024, with ongoing challenges in the construction sector affecting demand [30] - Brazil's local market is showing resilient steel demand, but there has been a significant year-over-year increase in imports [7] - Argentina's macroeconomic situation is improving, which is expected to support increased shipments in the upcoming quarters [8] Company Strategy and Development Direction - Ternium aims to enhance competitiveness by increasing operational efficiency and reducing costs amid a challenging trade environment [8] - The company is focusing on a significant expansion project in Mexico, with a revised total CapEx of $4 billion, representing a 16% increase from previous estimates [11] - The expansion will integrate advanced technology to improve operational efficiency and product quality, enabling Ternium to meet growing demand in the USMCA region [11][12] Management's Comments on Operating Environment and Future Outlook - Management highlighted that trade tensions and uncertainty are impacting global economic growth, but there is optimism regarding the reduction of reliance on Asian suppliers in North America [5][6] - The implementation of Plan Mexico is expected to enhance industrialization and strengthen the North American supply chain [6][13] - Management expressed confidence that the USMCA will become stronger and better prepared for future growth [14] Other Important Information - The company continues to maintain a strong balance sheet with a net cash position of $1.3 billion as of March 2025 [22] - Ternium's total CapEx for 2025 is projected to be around $2.5 billion, with significant investments in ongoing projects [22] Q&A Session Summary Question: Regarding the situation in Mexico and industrial customers - Management acknowledged the challenges in the Mexican market but expects demand to improve in the following quarters, particularly in the commercial sector [30][31] Question: On margins and profitability levels - Management noted that while margins have decreased, they expect a gradual improvement moving forward, with better margins anticipated in Q2 2025 [35][36] Question: On cost reductions and future volume growth - Management confirmed ongoing cost reduction initiatives and the potential for volume growth in Mexico, with a significant decrease in imports creating opportunities [41][42] Question: On cash returns and dividend payments - Management stated that despite uncertainties, they aim to sustain dividend payments due to a solid financial position [50] Question: On the outlook for Argentina's steel sector - Management expressed optimism about the improving outlook for the steel sector in Argentina, with expectations for increased shipments in the coming quarters [52] Question: On CapEx increase and project timelines - Management explained that the CapEx increase is due to higher construction costs and inflation, with the revised budget impacting the timeline of the expansion project [59][60] Question: On the U.S.-Mexico relationship and steel pricing - Management emphasized the need for a reasonable negotiation between the U.S. and Mexico regarding steel tariffs, expressing confidence in a favorable outcome [72][75] Question: On FX controls in Argentina and dividend payments - Management indicated that recent changes in FX controls are positive, allowing for more flexibility in dividend payments from Ternium Argentina [78][80]

Steel Market Dynamics - Ternium's steel prices have shown significant volatility, with U.S. prices of hot-rolled coils dropping to $485 per ton in 2020 and peaking at $2,135 per ton in 2021[37]. - In 2023, Brazil experienced a 42% surge in flat steel product imports, primarily from low-priced Chinese steel, adversely affecting domestic production[42]. - High inflation rates and tighter monetary conditions in the U.S. and Europe have contributed to weaker demand for steel products in these markets during 2022, 2023, and 2024[36]. - Ternium's competition is intensifying, with competitors potentially expanding production capacity and investing in modernization, which could impact Ternium's market share[45]. - The company faces risks from excess steel production capacity, particularly in China, which could lead to depressed margins and industry weakness[41]. - Supply chain disruptions, such as those experienced in the automotive industry in 2021 and Argentina in 2023, have negatively impacted steel demand and sales[43]. Business Strategy and Investments - Ternium's business strategy includes significant investments and acquisitions across multiple countries, including a new industrial center in Pesquería, Mexico, and expansion plans in Brownsville, Texas[50]. - Ternium's growth strategy may be adversely affected if acquisitions or investments do not perform as expected or if integration challenges arise[52]. - Ternium's goodwill related to its Mexican subsidiaries amounted to $662.3 million as of December 31, 2024, with investments in non-consolidated companies valued at $468.5 million[58]. - In July 2023, Ternium increased its participation in Usiminas, resulting in a non-cash net loss of $1.1 billion, including a $935 million loss related to prior stakes in Usiminas[59]. - Ternium's participation in Usiminas began in July 2023, consolidating its operations in Brazil, which could be impacted by local economic and regulatory developments[149]. Operational Risks - The ongoing geopolitical risks, including the Russian invasion of Ukraine, have led to disruptions in the global supply of slabs and other inputs, affecting Ternium's operations[47]. - Labor disputes remain a concern, with potential for work stoppages that could negatively impact Ternium's operations and financial results[62][64]. - Changes in foreign currency exchange rates could adversely affect Ternium's business, particularly as a significant portion of transactions occur in currencies other than the U.S. dollar[65]. - Ternium's operations in Mexico are at risk due to water scarcity and increased costs, particularly in areas affected by severe droughts, with new water use concessions suspended since 2022[79]. - Ternium's mining activities are subject to significant risks, including operational accidents and environmental liabilities, which could adversely impact profitability and result in material liabilities[85]. Environmental and Regulatory Challenges - The construction of Ternium's new steel slab facility in Mexico is expected to be completed by 2026, but may face delays and increased costs due to geopolitical risks affecting suppliers[54][55]. - Ternium's mining operations in Mexico faced significant challenges due to increased violence and crime, leading to the idling of its main mining operation during the first half of 2023[103]. - The company may experience increased costs and capital expenditure requirements due to factors such as changes in environmental regulations and diminished iron ore reserve grades[99]. - The Mexican Congress approved constitutional reforms in 2024 that could increase state control over key sectors, impacting Ternium's operations and market conditions[120]. - Ternium's operations are subject to significant regulatory risks, including environmental regulations that may increase operating costs and impact production[162]. Financial Performance and Economic Conditions - Ternium's ability to pay dividends is contingent on the financial performance of its subsidiaries, which could be adversely affected by legal and regulatory restrictions, particularly in Argentina[113]. - The Argentine government has announced plans for tax reform in 2025, which could increase the tax burden on Ternium's operations[142]. - Inflation in Argentina reached 118% in 2024, significantly affecting Ternium's cost structure and competitiveness[138]. - Ternium's financial results could be negatively impacted by changes in tax regulations and increased scrutiny from tax authorities globally[106]. - The U.S. government imposed a 25% tariff on steel imports from countries outside the USMCA region, which could adversely affect Ternium's operations and market dynamics[126]. Climate Change and Sustainability Initiatives - Ternium aims for a 15% reduction in emissions intensity by 2030 compared to a 2023 baseline, including Scope 1, 2, and 3 emissions[196]. - The EU's Carbon Border Adjustment Mechanism (CBAM), adopted on May 17, 2023, imposes a carbon levy on imports of certain products, including steel, from non-EU countries[172]. - New carbon pricing mechanisms in Mexico and Argentina could increase Ternium's production costs, affecting profitability and net results[177]. - Ternium is developing several projects aimed at reducing carbon emission intensity, but these projects may face delays or higher-than-anticipated costs[175]. - Ternium's environmental management system is certified under ISO 14001 and ISO 50001, ensuring compliance with environmental laws and regulations[226]. Community Engagement and Corporate Governance - Ternium invests in community programs focusing on education, culture, volunteer work, and health to foster sustainable growth in local communities[230]. - The company emphasizes transparency and ethical behavior through mandatory training programs and a Compliance Line for reporting violations[193]. - Ternium collaborates with small and medium-sized enterprises through the ProPymes program to strengthen its value chain and improve competitiveness[214]. - Ternium's community programs focus on education and technical training to support local development and social mobility[192]. - The company has centralized its processes on a unified IT platform, improving customer management through the digital marketplace "Ternium Activo"[221].

Financial Performance - Ternium S.A. reported its annual financial results for the year ended December 31, 2024, with a focus on operational data and consolidated financial statements prepared in accordance with IFRS[5][14]. - In 2024, Ternium's net sales reached $17,649 million, a slight increase of 0.2% compared to $17,610 million in 2023[53]. - Ternium's net income for 2024 was $174 million, significantly down from $986 million in 2023, impacted by a $410 million provision for ongoing litigation[45][48]. - Adjusted EBITDA decreased by 26% to $2,038 million, with an adjusted EBITDA margin of 12% compared to 16% in 2023[48]. - The operating income decreased to $1,263 million in 2024 from $2,198 million in 2023, reflecting a significant decline of 42.4%[53]. - The net financial results showed a loss of $194 million in 2024, compared to a gain of $123 million in 2023[56]. - Basic earnings per ADS were $(0.27) in 2024, down from $3.44 in 2023, while adjusted earnings per ADS were $1.61[48]. - Ternium maintained a robust net cash position of $1.6 billion as of December 31, 2024, despite significant cash disbursements[64]. - Cash from operations was $1.9 billion in 2024, with capital expenditures also amounting to $1.9 billion[63]. - Ternium's total financial debt was $2.2 billion as of December 31, 2024, with a weighted average cost of debt at 8.83%[73]. Sustainability and Environmental Commitment - The company aims for a 15% reduction in emissions intensity by 2030 compared to a 2023 baseline, including Scope 1, 2, and 3 emissions[27]. - Ternium is committed to achieving carbon neutrality and is collaborating with other companies and institutions to research and develop new technologies[27]. - The company emphasizes continuous improvement in operational performance through an energy efficiency program aimed at reducing the carbon footprint[20]. - Ternium has established a comprehensive sustainability agenda aligned with the United Nations Global Compact and reports progress through various frameworks[26]. - Ternium's research and development efforts focus on expanding advanced steel products and decarbonizing operations, with a commitment to reducing the carbon footprint and enhancing product complexity[83][84]. - Ternium is building pilot equipment to study renewable fuel injection mechanisms in steel production, aiming to reduce the carbon footprint of steel products[90]. - Ternium's expansion program includes a new pickling line and finishing center at the Pesquería industrial center, expected to enhance service capacity for automotive manufacturers[95]. - The new EAF-based steel shop, expected to start-up in 2026, will support Ternium's decarbonization targets and increase production of finished products in the USMCA region[96]. Community and Social Responsibility - Ternium's community programs focus on education and technical training, offering scholarships and internships to support local development[23]. - The company prioritizes diversity, equity, and inclusion, providing training programs through Ternium University to foster innovation and continuous improvement[22]. Operational Highlights - In 2024, Ternium's total steel shipments increased by 10% year-over-year to 15,622 thousand tons, primarily due to the full consolidation of Usiminas' results[48]. - The Mining Segment's net sales rose by 21% year-over-year, driven by a 56% increase in mining shipments to 6,426 thousand tons[48][50]. - Steel shipments in the Southern Region decreased by 20% year-over-year, primarily due to economic stabilization measures in Argentina[42]. - The automotive sector in Brazil saw a 10% year-over-year increase in vehicle manufacturing, reaching 2.6 million vehicles in 2024, boosting steel shipments[41]. Governance and Shareholder Information - Ternium's controlling shareholder is San Faustin S.A., which plays a significant role in the company's governance structure[17]. - The company is listed on the New York Stock Exchange under the ticker symbol TX, indicating its presence in the global financial market[12]. - Ternium's board proposed an annual dividend of $2.70 per ADS, totaling $530 million, to be approved at the upcoming shareholders' meeting[47]. - The annual dividend includes an interim dividend of $0.90 per ADS, totaling $177 million, paid in November 2024, and a proposed net dividend of $1.80 per ADS, totaling $353 million, to be paid on May 14, 2025[80]. Risks and Challenges - Ternium's operations are affected by fluctuations in industry inventory levels and supply chain disruptions, which can lead to irregular purchasing volumes[123]. - The steel industry faces risks from excess production capacity, particularly in China, which could lead to unfair trade practices and increased competition[120]. - Ternium's acquisitions and investments may not perform as expected, potentially impacting operations and profits[134]. - Uncertainty regarding global economic activity remains high, influenced by recent U.S. trade actions and geopolitical tensions[115]. - Ternium's operations in Argentina, Brazil, and Mexico are vulnerable to extreme weather events, which could materially damage production facilities and infrastructure, adversely affecting financial results[165]. - Ternium does not carry business interruption insurance, and existing property damage and general liability insurance may not adequately cover potential losses from extreme weather events[171]. - Labor disputes could lead to work stoppages, negatively impacting Ternium's operations and results[149]. - Ternium's operations are exposed to foreign currency exchange rate fluctuations, which could adversely affect financial results[153]. - Cybersecurity threats have increased in sophistication and frequency, with the manufacturing sector being particularly vulnerable to ransomware attacks in 2024[156]. - Ternium does not currently maintain cybersecurity insurance, which may leave it exposed to financial losses from cyber events[162]. Mining Operations and Regulatory Environment - Ternium has equity interests in two iron ore mining companies, with a 100% interest in Las Encinas and a 50% interest in Consorcio Peña Colorada, both of which are subject to operational and environmental risks[172]. - The company faces potential liabilities from environmental damages caused by mining operations, which could materially affect margins, cash flow, and profitability[176]. - Ternium's mining activities are subject to significant regulatory risks, including potential revocation of concessions if compliance with obligations is not met[181]. - Exploration activities are speculative and may not yield expected results, with substantial costs incurred that could adversely affect the company's business if sufficient ore resources are not found[186]. - Ternium's mining operations in Mexico may face increased costs and delays due to the need for continuous investment in equipment and compliance with environmental regulations[188]. - The company may need to substitute self-produced lower-cost iron ore with third-party iron ore, potentially increasing steel production costs if mining activities are not maintained[188]. - Ternium's financial condition could be adversely affected by difficulties in maintaining relationships with local communities, which may lead to disruptions in mining operations[191]. - Recent violence and crime in Mexico have worsened the security situation, potentially leading to temporary or permanent shutdowns of mining operations[194]. - The company is subject to increased scrutiny from tax authorities globally, which may impact financial results due to potential disputes over transfer pricing and double taxation[196]. - Ternium is preparing for the implementation of the OECD's Pillar 2 global minimum taxation framework, effective from 2024[198].

Group 1 - Ternium (NYSE: TX) experienced a significant decline in both topline and bottom line as it concluded the year 2024, with a double-digit contraction reported [1] - The primary reason for the topline decline was not specified, indicating potential underlying issues within the company's operations or market conditions [1] Group 2 - The article reflects a focus on understanding and explaining the financial details of companies, particularly in the technology, industrial, and conglomerate sectors, emphasizing the importance of strong foundational businesses for long-term success [1]