Ternium SA Q4 FY2024 earnings call

• Downstream expansion in Mexico: Pickling line and finishing center at Pesqueria started operations and are ramping up. Cold rolling mill startup advanced to December 2025, hot-dip galvanized line to end of 2025. - Wind farm in Argentina: Began generating energy with 22 turbines, expected to deliver ~480 GWh/year. - Trade challenges: US trade actions created uncertainty, with Mexico and Canada targeted; Ternium believes USMCA will continue to enhance competitiveness. - Market performance: Mexico shipments down in Q4 due to weak commercial market; Brazil 2024 saw 10% increase in flat steel apparent consumption and Usiminas produced 3.2 million tons of crude steel; Argentina shipments down ~20% in 2024 due to Argentine government macroeconomic measures. - Technical schools: Roberto Roca Technical School in Brazil began first classes, providing technical education to community students.

Steel Segment: In Q4 2024, steel shipments across key markets declined primarily due to seasonal demand reduction and Mexico's commercial market downturn. Full-year 2024 shipments were 16 million tons with adjusted EBITDA of $2 billion (12% margin). Net sales in the steel segment declined sequentially in Q4 2024 due to lower shipments and reduced realized prices. Mining Segment: Mining shipments were stable in Q4 but down ~9% year-over-year in Q4 2024, mainly due to lower production in Mexico and Brazil. Margins improved in the mining segment mainly driven by lower costs.

• Anticipate sequential increase in adjusted EBITDA in Q1 2025 supported by margin improvement and slight volume increase. - CapEx expected to peak in 2025 at around $2.5 billion. - Board of Directors proposed annual dividend of $2.70 per ADS, with $0.90 interim dividend paid in November and remaining $1.80 to be paid in May subject to shareholder approval.

• Uncertainty from US trade actions, including revocation of country-specific steel import exceptions under Section 232. - Uneven progress in Argentina's economic transformation could lead to higher imports of unfair trade steel products. - China's steel exports continuing to disrupt international markets, with Brazil still affected by high imports from China despite import quota measures.

Q: Could you provide more details on the outlook for the first quarter and update on ramp-ups in Mexico?

A: Pablo Brizzio mentioned expected steady shipments in Q1, margin improvement due to cost decline outpacing price decline. Maximo Vedoya discussed ramp-ups in Mexico: pickling and finishing lines ramping up, cold rolling mill startup advanced to December 2025, hot-dip galvanized line to end of 2025.

Q: Any thoughts on adding to stake in Usiminas and priorities for Usiminas?

A: Maximo Vedoya said Nippon and Ternium have options to buy/sell Usiminas stake exercisable in July. Priorities for Usiminas include CapEx in mining, improving Ipatinga's mill performance, and commercial efforts to combat Chinese imports.

Q: Thoughts on trade barriers against China in Argentina, Brazil, Mexico?

A: Maximo Vedoya was optimistic about Mexico acting quickly to defend against unfair trade, Brazil progressing with dumping cases, and Argentina potentially catching up as it stabilizes macroeconomy.

Q: How US plans to balance supply and demand without imports and impact on scrap markets?

A: Maximo Vedoya expressed optimism in USMCA's benefits and Mexico's plan to strengthen North America's supply chain, but noted no major changes in scrap markets in the next two years due to long lead times for new steel capacity.