GRUPO SIMEC ANNOUNCES RESULTS OF OPERATIONS FOR THE FIRST NINE MONTHS OF 2024
GUADALAJARA, Mexico, Oct. 29, 2024 /PRNewswire/ -- Grupo Simec, S.A.B. de C.V. (NYSE:SIM) ("Simec") announced today its results of operations for the nine-month period ended September 30, 2024.
Comparative first nine months of 2024 vs. first nine months of 2023
Net SalesNet sales of the Company decreased to Ps. 24,828 million in the first nine months of 2024 compared to Ps. 32,401 million in the first nine months of 2023. Shipments of finished steel products decreased 6% to 1 million 536 thousand tons in the first nine months of 2024 compared to 1 million 640 thousand tons in the first nine months of 2023. Total sales outside of Mexico in the first nine months of 2024 decreased 19% to Ps. 10,979 million compared to Ps. 13,571 million in the same period of 2023. Mexican sales decreased 26% from Ps. 18,830 million in the first nine months of 2023 to Ps. 13,849 million in the same period of 2024. The decrease in sales for the first nine months of 2024 is due to a decrease in the average selling price in 18% and with a lower volume of shipments compared to the first nine months of 2023.
Cost of SalesCost of sales decreased 23% from Ps. 24,305 million in the first nine months of 2023, to Ps. 18,625 million in the first nine months of 2024. Cost of sales as a percentage of net sales represented 75% in the first nine months of 2023 y 2024 in both periods, the average cost of sale by steel ton decreased approximately 18% in the first nine months of 2024 over the same period of 2023 due to a lower price in inputs, mainly steel scrap.
Gross ProfitGross profit of the Company for the first nine months of 2024 decreased 23% from Ps. 8,096 million in the first nine months of 2023, to Ps. 6,203 million in the first nine months of 2024. Marginal profit as percentage of net sales in the first nine months of 2024 y 2023 was of 25% in both periods. The decrease in gross profit is due to a decrease in the average selling price, with a lower volume of shipments and a decrease in the price of scrap compared to of 2023.
General, Selling and Administrative ExpensesSelling, general and administrative expenses increased 16%, to Ps. 1,834 million in the first nine months of 2024 from Ps. 1,587 million in the same period of 2023, selling, general and administrative expenses represented 7% to the 2024 and 5% to the 2023 of the net sales for both periods.
Other Income (Expenses,) net The Company recorded other income net for Ps. 71 million during the first nine months of 2024 while in the same period of 2023 the other income net by this concept was of Ps. 167 million.
Operating IncomeOperating income decreased 33% to Ps. 4,440 million for the first nine months of 2024 compared to Ps. 6,676 million in the first nine months of 2023. Operating income as percentage of net sales was 18% in the first nine months of 2024 and 21% in the same period of 2023. The decrease in operating income is due to a lower average sales price and to a lower volume shipped during the nine months ended September 30, 2024 compared to the same period in 2023.
EbitdaThe Ebitda decreased 31%, from Ps. 7,499 million in the first nine months of 2023 as a result of a net income of Ps. 3,821 million, less minority stake of Ps. 4 million, plus income taxes of Ps. 1,541 million, plus comprehensive financial cost of Ps. 1,318 million, plus depreciation of Ps. 823 million to Ps 5,189 million in the same period of 2024 as a result of a net income of Ps. 8,587 million, less minority stake of Ps. 2 million, plus income taxes of Ps. 762 million, less comprehensive financial cost of Ps. 4,907 million, plus depreciation of Ps. 749 million.
Consolidated
Million
Comparative first nine months of 2024 vs first nine months of 2023,
2024
2023
Net income (loss)
8,587
3,821
Loss attributable to noncontrolling interests
(2)
(4)
Net income (loss)
8,585
3,817
Depreciation, depletion, and amortization
749
823
Income taxes
762
1,541
Financial results income (loss)
(4,907)
1,318
EBITDA
5,189
7,499
Items to reconciled adjusted EBITDA
Equity results and other results in associates and joint ventures
0
0
Dividends received and interest from associates and joint ventures (i)
0
0
Impairment and disposal of non-current assets
0
0
Adjusted EBITDA
5,189
7,499
Comprehensive Financial CostComprehensive financial cost for the first nine months of 2024 represented an income of Ps. 4,907 million compared with an expense of Ps. 1,318 million for the first nine months of 2023. The net interest income was of Ps. 1,066 million for the first nine months of 2024, compared with a net interest income of Ps. 392 million in the same period of 2023. Likewise, we record an exchange income of Ps. 3,799 million in the first nine months of 2024 compared with an exchange loss of Ps. 1,754 million in the first nine months of 2023, and other financial income for Ps 42 million for the first nine months of 2024, dividends earned on purchase of shares, compared with other financial income for Ps. 44 million in the same period of the previous year.
Income TaxesThe Company recorded an expense of Ps.762 million for during the first nine months of 2024, (includes a deferred income tax of Ps. 88 million) compared with an expense of Ps. 1,541 million for the first nine months of 2023 (includes a deferred income tax of Ps. 8 million).
Net IncomeAs a result of the foregoing, the Company recorded a increase in net income of 125% to pass of Ps. 3,821 million in the first nine months of 2023 to Ps. 8,587 million of the same periods of 2024.
Liquidity and Capital ResourcesAt September 30, 2024, Simec's total consolidated debt consisted of U.S. $ 302,000 of 8 7/8% medium-term notes ("MTN's") due 1998, or Ps. 5.9 million (accrued interest on September 30, 2024 was U.S. $ 985,000, or Ps. 16.4 million). At September 30, 2023, Simec's total consolidated debt consisted of U.S. $ 302,000 of 8 7/8% medium-term notes ("MTN's") due 1998, or Ps. 5.3 million (accrued interest on September 30, 2023 was U.S. $ 806,000, or Ps. 14.2 million).
Comparative third quarter of 2024 vs. second quarter of 2024
Net SalesNet sales of the Company increased to pass of Ps. 8,394 million during the second quarter of 2024 to Ps. 8,549 million in the third quarter of 2024. Shipments of finished steel products decreased to 521 thousand tons in the third quarter of 2024 from 536 thousand tons in the second quarter of the same year. Total sales outside of Mexico in the third quarter of 2024 increased 3% to get to Ps. 3,593 million compared to Ps. 3,691 million of the second quarter of the same year. Mexican sales in the third quarter of 2024 increased to Ps. 4,858 million compared to Ps. 4,801 million in the second quarter of the same year. The average selling price increased 5% in the third quarter of 2024 compared to the second quarter of the same year.
Cost of SalesCost of sales increased to P s. 6,393 million in the third quarter of 2024 from Ps.6,356 million in the second quarter of 2024. Cost of sales as a percentage of net sales represented 75% in the third quarter of 2024 and 76% in the second quarter of the same year. The cost of sales increase 3% in the third quarter of 2024 compared to the second quarter of the same year, due mainly to a decrease of some supplies for the manufacture of steel.
Gross ProfitGross profit of the Company for the third quarter of 2024 increased 6% to pass of Ps. 2,038 million in the second quarter of 2024 to Ps. 2,156 million in the third quarter of same year. Gross profit as a percentage of net sales in the third quarter of 2024 was of 25% compared to 24% in the second quarter of the same year. The increased in the gross profit is due to increase in the average price in the third quarter compared to the second quarter of 2024.
General, Selling and Administrative ExpensesSelling, general and administrative expenses increased 13% to of Ps. 658 million in the third quarter of 2024 from Ps. 580 million the second quarter of the same year, and as percentage of net sales represented 8% for the third quarter of 2024 compared to 7% for the second quarter of the same year.
Other (Expenses) Income, net The Company recorded other income net for Ps. 26 million during the third quarter of 2024 compared to other income net for Ps. 40 million in the second quarter of 2024.
Operating IncomeThe Operating income was of Ps. 1,524 million in the third quarter of 2024 compared to Ps. 1,498 million in ...
