Call Start: 08:30 January 1, 0000 9:22 AM ET

Ternium S.A. (NYSE:TX)

Q1 2022 Earnings Conference Call

April 27, 2022 08:30 ET

Company Participants

Sebastian Marti - Global Investor Relations & Compliance Senior Director

Maximo Vedoya - Chief Executive Officer

Pablo Brizzio - Chief Financial Officer

Conference Call Participants

Caio Greiner - BTG Pactual

Carlos De Alba - Morgan Stanley

Thiago Lofiego - Banco Bradesco

Alfonso Salazar - Scotiabank

Operator

Good morning. My name is Rob and I will be your conference operator today. At this time, I would like to welcome everyone to the Ternium First Quarter 2022 Results Conference Call. [Operator Instructions] Sebastian Marti, you may begin your conference.

Sebastian Marti

Thank you. Good morning and thank you for joining us today. My name is Marti and I'm Ternium's Global Investor Relations and Compliance Senior Director. Ternium released yesterday its financial results for the first quarter of 2022. This call is complementary to that presentation. Joining me today are Ternium's Chief Executive Officer, Maximo Vedoya; and the company's Chief Financial Officer, Pablo Brizzio, who will discuss Ternium's business environment and performance. At the conclusion of our prepared remarks, there will be a Q&A session.

Before we begin, I would like to remind you that this conference call contains forward-looking information and the actual results may vary from those expressed or implied. Factors that could affect results are contained in our filings with the Securities and Exchange Commission and on Page 2 in today's webcast presentation. You will also find any reference to non-IFRS financial measures reconciled to the most directly comparable IFRS measures in the press release issued yesterday.

With that, I'll turn the call over to Mr. Vedoya.

Maximo Vedoya

Thank you, Sebastián. Good morning to everyone and thank you very much for joining us today. Ternium showed a strong set of results in the first quarter of the year. Shipments are recovering and margins decreased as expected, although they remained at high levels. Since our last conference call in February, the global steel business environment changed significantly as a result of the invasion of Ukraine and a consequent wave of international sanctions against Russia, not to mention the humanitarian tragedy this conflict created. In an already volatile steel market environment, the conflict in Ukrainia brought even more disruptions as both of these countries are relevant participants in the trade of steel and related raw materials, creating scarcity of these inputs and a consequence, cost push to steel prices. Big iron, PCI, slabs and hot-rolled steel were particularly affected. As a result of these supply disruptions in the international steel markets, previously declining steel prices took a sharp turn up by the end of the first quarter and recently stabilized at relatively high levels.