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Image source: The Motley Fool. Wednesday, Aug. 5, 2026 at 8 a.m. ET Global IR and Compliance Senior Director - Sebastián Martí Chief Executive Officer - Maximo Vedoya Chief Financial Officer - Pablo Brizzio Operator: Good morning, ladies and gentlemen. Welcome to Ternium's Conference Call to Discuss the Results for the Second Quarter 2026. We would like to inform you that this event is being recorded. [Operator Instructions] We would like to remind you that this conference call is intended exclusively for investors and market analysts. We request you that questions from journalists be dedicated to the media relations through our website in the press section. With this, I would like now to turn the floor over to Mr. Sebastián Martí. You may proceed. Sebastián Martí: Okay. It seems we had some technical issues. I hope you can hear us now. Okay. Let's go again. Good morning, and thank you for joining us today. My name is Sebastián Martí, and I am Ternium's Global IR and Compliance Senior Director. Yesterday, we announced our financial results for the second quarter and first half of 2026. Today's call is intended to provide additional context to that presentation. I'm joined by Maximo Vedoya, Ternium's Chief Executive Officer; and Pablo Brizzio, the company's Chief Financial Officer, who will discuss Ternium's operating environment and performance. Following our prepared remarks, we will open up the call to your questions. Before we begin, I would like to remind you that this conference call contains forward-looking information and that 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: Good morning, everyone, and thank you for joining us. Yesterday, we reported a significant increase in Ternium's results in the second quarter. Adjusted EBITDA was 50% higher sequentially, and our EBITDA margin reached 16.5%. Our balance sheet remain strong [indiscernible] $112 million. And with the peak of our investment program in Mexico behind us, we expect capital expenditures to keep declining further down the road. Before turning to our markets, let me say a few words on safety. Two weeks ago, we held Ternium's Safety Week, which we run every year across all of our operations. We stopped our production lines and more than 21,000 people took part in safety awareness routines. Stopping production across the company sends a clear message of our priority. Moving to Mexico. Shipments increased and margin expanded. The business environment is slowly getting better. Government measures against unfair trade are already helping steel volumes recover, and the country continues to strengthen its trade defenses. The commercial market improved during the quarter, supported by restocking along the value chain, which is bringing inventories back to a more balanced level. We are also gaining market share in this segment, helped by lower imports and by our stronger performance versus peers as customers continue to value Ternium's reliability, service and ability to respond quickly. Steel demand in the industrial market did not grow at the same pace. The auto sector remains healthy and HVAC is improving on demand from data centers, but Section 232 tariffs are affecting our customers in this and other manufacturing sectors. We expect volumes to continue recovering gradually in the third quarter. We are supplying steel for new gas pipeline projects and replacing Asia imported steel from several automotive OEMs. Public infrastructure projects under the agreement to promote the Mexican steel industry should add further demand ahead. Moving to trade. The U.S. and Mexico has held 3 meetings in the last month to work towards a new framework. These talks have advanced, although they are not yet produced concrete results. For the Mexican government, Section 232 remains a top priority. These tariffs are hard to justify in the case of steel as the U.S. runs a large trade surplus with Mexico, and it's by far its larger external supplier. At the same time, there is still excess steel capacity in the world, and this make it necessary to keep working on the trade front. Our fourth round of talks will take place in Washington in early September. Turning to Pesqueria. Our new downstream lines continue to ramp up and the slab facility is progressing well with start-up expected in early 2027. This new capacity positions Ternium well for a more integrated and better defended North American market, where local supplies becomes a competitive advantage. Ternium is prepared to serve that demand with local capacity, short lead times and the technical support that industrial customers require. On top of that, the steel from our new slab mill will reach the automotive industry with a carbon footprint well below that of the blast furnace-based steel that still supplies most of the region's automotive market. Before moving on to other markets, let me mention 2 recognitions we received in Mexico since our last call. Caterpillar distinguished Ternium through its Supplier Excellence Recognition program for the fourth year in a row. And we also received Trinity's Premier Supplier Award in the steel category. Awards repeated over time and across industries show that our customers value the quality of our products and the service of our team. Turning to Brazil. Trade defense is advancing. In June, the steel quota system was renewed until June 2027, and the antidumping case on hot-rolled coil from China should reach a final decision during the remainder -- during this year. More is still needed but the direction is positive. Demand across consuming sector remain uneven. Automotive is solid with production expected to grow by 6% this year. And road and infrastructure equipment remains dynamic. Other sectors are weaker, affected either by slow demand or unfair competition from imported finished goods. Against this backdrop, Usiminas has improved its profitability over the last few quarters. This came from better industrial performance, strict cost control and higher productivity. A key milestone for this competitiveness was the completion of the pulverized gold injection project, a structural step forward that brings great efficiency and lower cost while also reducing emissions intensity. We also received important customer recognitions. General Motors named us Supplier of the Year in the industrialization and trust category, and Honda Motors granted us a Gold Best Supplier Award. In Argentina, shipments increased sequentially in the second quarter, mostly for seasonal reasons. Our view on this market has not changed. We continue to expect energy, mining and agriculture to be the most dynamic sectors with construction recovering gradually from still low levels. Manufacturing remained weak, held back by soft demand and strong competition from imports. In July, we published Ternium's 2025 Sustainability Report. One of the main updates in this revision is, sorry, is the revision of our 2030 decarbonization target, which now includes Usiminas and uses 2024 as a new base year. We are committed to reducing emissions intensity per ton of hot-rolled steel by 50% covering Scope 1, 2 and 3 under GHG protocol methodology. The report also covers our progress in energy efficiency, environmental management, safety and the community engagement. I encourage you to read it. It gives a complete view of the work Ternium is doing in all these fronts. This was a quarter with a solid recovery in profitability and a balance sheet that remains very strong. Looking ahead, we expect performance to continue showing good results in the third quarter, supported by the recovery in Mexico, a more balanced trade environment in Brazil and steady progress on our strategic projects. All of this rests on the daily work and commitment of all our people, and I want to thank them all. With this, I'd like to move to a review of our quarterly performance. Pablo, please go ahead. Pablo Brizzio: Thanks, Maximo, and thanks, everybody, for participating in this call. So let me turn to our operational and financial performance for the second quarter of this year. Adjusted EBITDA rose in the second quarter, driven by higher volumes and better margin with adjusted EBITDA margin expanding to 16.5% from 12.2% in the first quarter. Performance benefited from the strengthened market fundamentals in Mexico and more constructive steel market environment in Brazil. The key drivers behind this result was improvement in realized steel prices, mainly in Mexico and Brazil. Looking ahead, we expect adjusted EBITDA to increase sequentially in the third quarter, driven by higher shipments and an improved adjusted EBITDA margin. This margin expansion should reflect higher revenue per ton, partially offset by an increase in cost per ton across our markets. Net income reached $465 million in the second quarter, primarily driven by strong operating performance. Compared to the first quarter, the improvement in operating income was partially offset by lower net financial results, mainly from foreign exchange losses and lower deferred tax gains. Let's review the Steel segment shipments now. Consolidated shipments increased by 4% sequentially in the second quarter. In Mexico, volumes continue to rise, supported by strengthening in the commercial market, lower imports from more effective trade defense against unfair trade practices and efforts to improve market share, as already was explained by Maximo. In Brazil, sales volumes were broadly steady versus the first quarter with Usiminas maintaining its focus on margin rather than volume. In the Southern region, volume picked up in a typical seasonal recovery even as the underlying demand continues to hold steady. Looking ahead, we expect shipments to keep recovering mainly in Mexico, supported by sustained commercial market momentum and also in Brazil as trade measures take hold and inventories normalize. Moving to the Steel segment performance. Steel cash operating income rose by $204 million sequentially with higher volume and realized steel prices, growth per ton increased slightly, which should see revenue per ton and margins to continue improving in the third quarter. Turning now to the Mining segment. Shipments normalized in the second quarter, reflecting the seasonal recovery of iron ore shipments in the Brazilian operations. Cash operating income declined slightly sequentially as lower realized iron ore prices were partially offset by higher sales volume. Let's review now the cash flow and balance sheet. Although we had a significant increase in operating results, this was partially offset by a $418 million buildup in working capital consistent with higher sales and increased raw material prices and steel costs. Capital expenditure reflect our progress in the expansion of the industrial center in Pesqueria, now mostly focused on the construction of the new slab facility. During the quarter, we also paid a dividend to shareholders of $255 million, corresponding to the balance of the total dividend declared for the fiscal year 2025. With this, we end June 2026 with a net debt position of $112 million compared to a net cash position of $327 million at the end of March. Finally, let me close with a quick look at our first half performance. In the first 6 months, adjusted EBITDA was $1.2 billion, rising 65% year-over-year, with EBITDA margins expanding to 14% from 9% in the same period of last year. Net income for the first half amounted to $837 million, resulting in shareholders earning of $2.84 per ADS, almost double the prior year level, supported by stronger operational results on higher steel margins. Cash from operations totaled $473 million with a year-over-year decline mainly driven by higher working capital needs with higher inventory values and higher receivables associated with an increase in steel prices as well as higher raw material costs. Capital expenditure reached $837 million in the first half, reflecting continued investment in the Pesqueria expansion. With this, we are leaving behind the peak of our investment cycle and expect CapEx of $1.6 billion for the full year 2026, moderating to around $1.2 billion next year. With this, I conclude the -- and we conclude our prepared remarks. So we would like now to welcome your questions. Please, operator, go ahead. Operator: [Operator Instructions] Our first question comes from Mr. Rafael Barcellos from Bradesco BBI. Rafael Barcellos: Congratulations for the results. So looking at your price realization in the second Q, I mean, it was very strong. But looking at the -- how Mexican steel prices have performed over the past few months and given the contract lags, I mean, it seems that your second Q price realization could have been even better than what you published in the second Q, right? So that said, does it mean that you have an even stronger price realization in the third Q, I mean, growing quarter-over-quarter even more than what you published in the second Q? And on top of that, if you can comment a bit on the overall market environment in Mexico? I mean, how do you see prices evolving from now on? And as a second question regarding the USMCA discussion. I mean, we're understanding that the likelihood of seeing deals made by sector by sector are like more likely than a broader USMCA revision. So I just wanted to understand whether you believe this statement is correct? And what is the likelihood of seeing any sort of agreement with the U.S. happening before the year-end? Maximo Vedoya: Thank you, Rafael. The first question about prices. So -- and the prices in Mexico, particularly, one of the things that's happening, and as I said in the initial remarks, we are -- we are having more shipments in the commercial market than in the industrial market. So the mix that we are selling is different of what it was in the past. I mean, as I said, the 232 tariffs are affecting -- it's not very big, but they are affecting the production of all the industrial base customers we have in Mexico. And so they are a little bit cautious on what they are doing. And that makes the mix of what we are selling different -- a little different. And prices in the commercial market are more on a spot basis. And so that's why I guess your comment on the realization price are a little bit lower of what you expect. We expect some changes in the third quarter, but don't expect huge movements because this dynamic is still going on in Mexico. And regarding market environmental in Mexico, I think that resumes also. I mean, Mexico is improving demand, but the demand in Mexico is not that it's increasing very much. I mean World Steel released the other day what the annual consumption improvement of steel would be in Mexico, and they said the growth was going to be 4%. And I kind of agree with that number. Our steel shipments are increasing a little bit more because we are gaining more market share against imports, which I think is a very good thing. But the market is growing, but it's growing at a pace that still needs to improve more. And I think part of this is the discussions U.S. and Mexico are having. Regarding USMCA, there's a lot of speculations of all the talks that are being held between the U.S. and Mexico. I mean, I don't want to speculate more of all the things that have been said. What I think it's happening also is, I mean, for one part being several deals or making a huge deal, priorities for Mexico is the 232 in all the sectors, which is very correct. And priority for the U.S. is that Mexico step up its defense against unfair trade, not only in steel, but in other products, which I think is also correct. And both things -- I mean, how we move in both directions, I think it's -- both of them are positive for us and for the Mexican market. So I hope that they start making some new steps in the direction of these objectives really soon. I hope with this, Rafael, I answer a little bit your questions. Rafael Barcellos: Yes. Just as a quick follow-up, just to clarify. So on the first part, on the first question, on the price side, you mentioned that we should not expect many changes, but I understand in terms of mix, right? So the mix should not change much in the third Q. But of course, price realization will be -- we will see like an increase in price realization quarter-over-quarter kind of similar to what we saw happening in the second Q, right? Maximo Vedoya: You're right about that, Rafael. Yes, that's completely correct, Rafael. Rafael Barcellos: Okay. Very clear. So the mix will not change, but prices will go up like you published in the second Q. Okay. Maximo Vedoya: Something like that. Yes. Operator: Our next question comes from Emerson Vieira from Goldman Sachs. Emerson Vieira: I have 2 questions as well. One on volumes in Mexico. I think one of the most difficult parts here is trying to estimate what could be the incremental volumes that the company is perceiving right now due to the infrastructure projects, right? So can you share any sensitivity here in terms of what could be the incremental steel demand for Ternium because of those projects that are being delivered or actually are starting, right, by Pemex, CFE and et cetera? What could be the upside here to volumes in your view? And is it correct my understanding that this impact is coming earlier than anticipated, if I'm not -- if I'm right, in the last quarter, you guys mentioned that you could expect those higher volumes only coming in the end of the year, and now this is being anticipated. So this is the first question, and then I will move on to the second one later on. Maximo Vedoya: Okay. Thank you, Emerson for your question. I mean what is happening with all this is that infrastructure is starting to pick up. If you see the numbers of Mexican economy and consumption in infrastructure, it decreased in 2025. It didn't move up in 2026 much. But now there are some projects gaining momentum. Infrastructure projects are not projects that you're going to start one quarter and improve a lot to the other quarter. I mean they are taking some time. We are discussing, and this is a number, but you cannot put it in our projections, but -- with this agreement that we make with the Mexican administration of the steel industry, we are discussing projects of around 600,000 to 700,000 tons. But this is not coming in 1 quarter. These are project at least for 1.5 years. How much of that will realize in the following quarters, not much of that. This is taking time. I hope I kind of clarify that, Emerson. Emerson Vieira: All right. So 600,000 to 700,000 tons is considering all projects that you guys have entered into partnerships, right? Maximo Vedoya: Yes, yes. But you have to take at least 1 or 2 years to develop all that. Emerson Vieira: All right. And then my second question, please, is just on capital allocation. In May, the company revised down the proposed dividends, right, when the geopolitical scenario was more uncertain. Of course, uncertainties still exist, but I mean, we are seeing earnings improving at a faster pace. So would it make sense to believe that dividends could be raised and maybe return to prior levels or even above? I mean, what is the company's view here on the dividend payments going forward in light of those changes? Maximo Vedoya: That's a great question. I mean, let me put a view first on our capital allocation and then specific on the dividends, probably Pablo can answer that. But I mean, if you see our CapEx, I mean, we are coming out of a period of a significant CapEx for us. You know all this, all the Pesqueria project, all the investment we have to do in Usiminas in the different operations. So I mean, in 2027, CapEx is going to decrease. I think Pablo mentioned the number, USD 1.2 billion, USD 1.3 billion from a CapEx of this year of around USD 1.6 billion. So the priority probably next year in this CapEx allocation would be to take advantage and consolidate all that we have made through this year, last year investments. So we have to consolidate this industrial system and focus on the operation and start-up of all these facilities. And you're right about the uncertainty, but we are still operating in a quite uncertain environment. So things look a little bit better. But the amount of uncertainty in the world economy is not over yet, and we are monitoring that very, very deeply. Nevertheless, we continue having the return of investment or the return to shareholders as a key part of our capital allocation. I don't know, Pablo, if you want to put a little more in the numbers. Pablo Brizzio: Yes. Yes, Maximo. Yes, it's very clear what you said that some things that we have seen in the past are still there, but it's also very clear, as I mentioned and you have put there that the return of the company are improving. That is a very good piece of news and that we are moving into a coming year in which we will have improved results and reduced CapEx. So as we have seen in the past, this company has a tradition and have shown that at the moment that we increase result and we believe that we could sustain this an increase in dividend, this is a possibility that the company will put forward. So the conditions are there. We need to see if there is changes in the near future because we are not yet at the moment of a definition of dividend. But clearly, that -- what you mentioned is clearly a possibility. Operator: Our next question comes from Caio Ribeiro from Bank of America. Caio Ribeiro: So I have 2 questions on the trend of North America steel markets, right? So first off, looking at the HRC prices in Mexico and the U.S., there's quite a large gap, right, of around $300 per ton, which has been expanding over the past year. So just curious to hear from you, if you can talk a little bit about how lead times, inventory levels look in Mexico, just to try and understand how they compare to the U.S. where lead times are well above average at 9 weeks, inventory is quite low. And on this note, if the trigger to narrow that spread is really just a reduction in tariffs for Mexico or if you see any other triggers here? And then secondly, HRC prices in the U.S., right, have clearly had a strong run over the years -- over the past year. And as you look ahead, I just wanted to see how you view the restart of that large blast furnace, Gary Works that was idled for maintenance and the start-up of Nucor's new capacity later this year and whether you see those as risks that could generate a price inflection point and if current price levels are already encouraging a pickup in imports. Those are my questions. Maximo Vedoya: Thank you, Caio. I mean, from the first, the gap between Mexico and U.S. prices, I don't think the gap is due to this different lead times on inventory. If you see the price in Mexico, price in Mexico are following the same trend as in the U.S. They are increasing. And I think lead times inventory are quite similar to what is happening in the U.S. There is a difference, of course, is the 232 in the U.S. and that the trade measures in Mexico are not as effective as the ones in the U.S., notably this 232. So the trend in Mexico is going to continue as it's been in the several last months. But the gap is going to start closing once I think these discussions between the U.S. and Mexico start putting some conclusions. I mean, if you -- I said it before, I mean, what Mexico is asking is to get rid of the 232 between Mexico and the U.S. And U.S. is asking to put more tough trade measures in Mexico. And as I said, both are quite good and both have reasons to ask that. And so an agreement can reach can be reached, I think, in those sense. And in that part, the gap between both prices will probably reduce. So that's regarding Mexican prices. The increase in capacity in the U.S., I don't think -- I mean, the U.S. is decreasing the import volume. And -- but if you see the demand, it's still not picking up demand in the U.S. The consumption of steel in the U.S. is still the same this year than last year. It should increase. And the new capacity should be swallowed by this increase in demand and the decrease in imports. I don't see a huge risk there, Caio. Clearly, it could be some moments when prices decrease, there is a little bit more offer than demand. But I don't see a huge impact of those -- of this restart of capacity. I hope that answered the question, Caio. Operator: Our next question comes from Alfonso Salazar from Scotiabank. Alfonso Salazar: Two questions for you, Maximo. The first one -- and both are regarding the Mexican market. The first one is, can you share what's the move among clients in Mexico? We saw the decision of Toyota moving part of the production of the Tacoma to the U.S. So I want to hear what is the move regarding -- when you have conversations with your clients in Mexico, what they are thinking, what are the challenges that they are facing. For example, if there is -- the 232 goes away, they will face higher prices for steel. So just what are the conversations that you're having with them? The second question that I have is your view on the -- on Mexico regarding where it stands in the new global auto market or the new global auto arena because we see the U.S. buys pickups and SUVs. China leads the electric vehicle and the low-cost auto markets. And the OEMs are losing market share in basically everywhere except in the U.S. So what is the future for the U.S.? I think it's a good time to rethink about that now that the Pesqueria plant is -- the new slab facility is close to complete. Maximo Vedoya: Thank you, Alfonso. So I mean, what is the move of our customers? And I guess you are talking about the industrial customers in Mexico. As I said, I think customers, especially those of U.S. origin, they are expecting to have a resolution in the 232 and in the USMCA discussions. I think that most of the customers think that there is going to be a solution or an agreement, and they are waiting for that because they have a huge supply chain operation in Mexico and the U.S. And I think that the objective that the Trump administration is moving in reducing the trade deficit that they have with Asia they are going to do it with an agreement with Mexico. So they are in this mood of waiting. And I think the bigger challenge is the 232. I don't think that customers think that without the 232, the cost is going to increase. What they think is without the 232, they can have really the opportunities to produce in Mexico and the U.S. and have a more strong regional market, and they are going to take advantage of that. So I think that's the challenge really today. In the same place, the OEMs are also expecting this resolution, I think. It's not that in Mexico, remember, the Mexican auto producing around 4 million units a year. They are not decreasing the production. The production is quite the same year 2025 to 2026. So they are expecting to solve 232 and have a regional market strong. If you go to the U.S. market, U.S. are producing a little bit more of 8 million units, but they are importing sort of 8 million units. So there's a huge opportunity there for integration between Mexico and the U.S., and I think that they are expecting that. But of course, this should take effect and when conversation between U.S. and Mexico move forward. Alfonso, I hope I answered your question with this. Alfonso Salazar: Yes. Just a follow-up. So yes, for the industrial customers, for sure, you are right with the 232. For commercial market or your commercial customers, they may face higher steel prices, right? That would be the implication of not 232. Maximo Vedoya: I don't know if they're going to face higher prices, Alfonso. I think they're going to -- they're going to have the prices of the market that doesn't reflect and fair competition. They know that, and they are okay with that. I think for commercial customers today, the main issue is how demand and how growth pick up in Mexico. Mexico has not been growing very much, as I said, last year, steel consumption decreased by 10%. That's a huge number. This year, steel consumption is expected to increase by 4%, still way back of our peak in 2023. So what the commercial customers are expecting is a growth in construction, a grow in infrastructure programs, a growth in the demand of steel, and they are expecting that. We're waiting for that. That's the biggest challenge they have today. And that's the usual talk we have with all our customers in the commercial market. Operator: [Operator Instructions] Our next question comes from Daniel Sasson from Itaú BBA. Daniel Sasson: Congrats on the results. My first question is actually related to your capital allocation decisions. After you've mentioned Pesqueria a number of times during the call and we are nearing conclusion of the project. And then you guys should enter a period of much stronger free cash flow generation, right? So I wanted to understand better how you're thinking about it. Could we see dividend payments increasing over the next few years? Or maybe you guys that have always been conservative in regards to your balance sheet position, now think that it's better to keep more cash on hand in light of the geopolitical turbulences and things like that. So that would be great to understand how you're thinking about capital allocation. And if that could include, for instance, buying all remaining Usiminas shares, if you could -- if it would make sense at all for you to unlist or delist the company in Brazil? And my second question is actually related to Pesqueria. If you could give a little bit more color on how we should model your reduced needs for slab purchases from third parties after the project starts up versus other additional costs like related to our energy matrix, related to iron ore needs and so on and so forth. That would be nice for us to understand the delta in EBITDA coming exclusively from Pesqueria in 2027 versus 2026, everything else kept equal. Those are my questions, guys. Maximo Vedoya: Daniel, thank you very much for the questions. I'll start with the second one first. Pesqueria, remember, Pesqueria is going to start -- the slab facility is going to start at the beginning of the year, but it's a very complex and huge project. So the ramp-up will take us several quarters. So you are not going to see a lot of changes in 2027, at least from an EBITDA ratio point of view. You're going to -- I mean, what the Pesqueria facility give us is that we are going to sell or we are going to supply to our automotive customers with melt and pour -- steel melt and pour in the region that are needed with the change of the USMCA. So -- and to do that, we need not only to ramp up our facility, but to have all the certification process ready, which takes a lot of time. I mean it's quicker in some of the items, but it's very long in other items. We still have -- we now have and we are discussing with all the customers probably more inquires for changing to Pesqueria ourselves that we -- the capacity we have in Pesqueria. So we are very enthusiastic about what is Pesqueria, but don't expect in 2027 a huge impact because of what I'm telling you. I mean, we are going to focus in 2027 with the ramp-up and with all the certification. But the certification process for more than 2.5 million tons takes a lot of time. So that's the focus in 2027. I hope that answers the second question, Daniel. For the first question, capital allocation, I think, Pablo, you answered a little bit, but give it -- I mean, more detail, please. Pablo Brizzio: Yes. Okay. Let me summarize a little bit what do we do in respect to capital allocation. And clearly, we have different things. First of all, you're right that our results are improving. Second, as Maximo was just explaining, we have or we are at the very end of our big CapEx plan, but we need to take 1 or 2 years to digest everything that we are doing. And as Maximo explained, it's a very complex process to ramp up the new facility and to obtain and achieve all the certification to fully take advantage of the new facility that we have. So why we are saying that or why I'm saying that is because it's very difficult for Ternium at this point to have or to launch any new big CapEx project in the real near future. Of course, we have certain things to mention like all the CapEx as maintenance CapEx and things that we're doing. We already mentioned that we will be doing $1.2 billion in CapEx next year. At some point, we will take a decision in respect to the mining activity in Brazil. So we have certain things to move around. But we will have room to take that and 2 things: one, to increase dividend if the sustained better results is confirmed. And secondly, something that you mentioned, and you're right that we tend to be a little more conservative than some companies, and we prefer to have a very strong financial position in order to support future alternatives that could happen. You mentioned things like acquiring shares. You know that theorical answer to that in the long run is the answer is yes because we have as a goal to simplify our corporate structure. But there are certain conditions yet in -- especially in respect to such shares that makes us a little difficult to move forward in the short run. But again, as a general point of view, we -- of course, we would like to sustain a strong financial position. We would like to sustain a positive and if possible growing dividend payment and take advantage of all the things that we have been doing up to now. In that respect, things can happen in the future, and we will be prepared to take advantage of that. Operator: Thank you. That concludes the question-and-answer session. I would like to turn it back over to Mr. Maximo Vedoya for closing remarks. Maximo Vedoya: Okay. Thank you all of you for joining us today. We welcome any feedback you have or any additional questions and have a great day. See you in a couple of months. Operator: Ternium's conference call has now concluded. Thank you for attending today's presentation. You may now disconnect and have a good day. Before you buy stock in Ternium, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Ternium wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $411,427!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,335,252!* Now, it’s worth noting Stock Advisor’s total average return is 965% — a market-crushing outperformance compared to 215% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. 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Interested in Ternium S.A.? Here are five stocks we like better. Second-quarter profitability rebounded: Adjusted EBITDA rose 50% sequentially to a 16.5% margin, supported by higher shipments, improved prices and stronger conditions in Mexico and Brazil. Net income reached $465 million, while first-half adjusted EBITDA increased 65% year over year to $1.2 billion. Mexico recovery and Pesquería expansion are key growth drivers: Lower imports, restocking and market-share gains improved Mexican volumes, while the new slab facility is expected to begin operations in early 2027. Management expects third-quarter EBITDA to increase sequentially, though the facility’s earnings contribution will initially be limited during its ramp-up. Capital spending is set to decline: Ternium expects 2026 capital expenditures of $1.6 billion, falling to about $1.2 billion in 2027 after the Mexico investment program peaks. The company ended June with just $112 million in net debt and said higher dividends could be considered if stronger results prove sustainable. Top Dividend Plays With Strong Analyst Ratings Ternium (NYSE:TX) reported a sequential recovery in second-quarter profitability, supported by higher steel shipments, improved realized prices and stronger market conditions in Mexico and Brazil. The company said adjusted EBITDA increased 50% from the first quarter, while its adjusted EBITDA margin expanded to 16.5% from 12.2%. Chief Executive Officer Máximo Vedoya said the company ended June with net debt of $112 million and expects capital expenditures to decline after reaching the peak of its investment program in Mexico. The company’s major Pesquería expansion is now primarily focused on construction of a new slab facility, which is expected to begin operations in early 2027. → No Hangover: Revisiting Microsoft One Week After Earnings Win-Win Momentum Plays With Strong Dividend Yields Chief Financial Officer Pablo Brizzio said second-quarter net income reached $465 million, driven principally by operating performance. The quarter-over-quarter increase in operating income was partly offset by weaker financial results, including foreign-exchange losses and lower deferred-tax gains. Consolidated steel shipments rose 4% sequentially. In Mexico, shipments continued to increase as the commercial market improved, imports declined and Ternium gained market share, Brizzio said. Sales volumes in Brazil were broadly stable, as Usiminas maintained its focus on margins rather than volume, while volumes in the company’s southern region increased seasonally. → MarketBeat Week in Review – 08/03 - 08/07 3 Construction Stocks Set to Surge on Tariff-Driven Demand Steel segment cash operating income increased by $240 million from the first quarter, reflecting higher volumes and realized steel prices. Costs per ton rose slightly. For the third quarter, Ternium expects adjusted EBITDA to rise sequentially on higher shipments and a higher EBITDA margin. Brizzio said revenue per ton should increase, although this is expected to be partly offset by higher costs per ton across the company’s markets. → Why the Landlord of the AI Boom Could Outlast the Chipmakers For the first half of 2026, adjusted EBITDA totaled $1.2 billion, up 65% from a year earlier, and the EBITDA margin increased to 14% from 9%. First-half net income was $837 million, or $2.84 per American depositary share, nearly double the prior-year level, according to Brizzio. Vedoya said Mexico’s business environment has been gradually improving as government measures targeting unfair trade practices help steel volumes recover. He said restocking in the commercial value chain helped bring inventories closer to more balanced levels, while lower imports and Ternium’s service capabilities contributed to market-share gains. Demand from industrial customers has improved more slowly. The automotive sector remains healthy, while heating, ventilation and air-conditioning demand has benefited from data-center investment, Vedoya said. However, U.S. Section 232 tariffs continue to affect manufacturing customers in Mexico and have contributed to a different product mix, with commercial-market shipments representing a larger share of sales. In response to an analyst’s question, Vedoya said Ternium expects improved price realization in the third quarter, though it does not expect major changes in the sales mix. He characterized Mexican steel demand growth as modest, citing an expected 4% increase in steel consumption this year after consumption fell 10% in 2025. The company also expects demand from public infrastructure projects to develop over time. Vedoya said Ternium is discussing projects totaling roughly 600,000 to 700,000 tons under an agreement with the Mexican government and steel industry, though he said those projects would take at least one to two years to develop rather than adding substantial demand in a single quarter. U.S. and Mexican officials held three meetings during the past month regarding a new trade framework, with a fourth round scheduled in Washington in early September. Vedoya said Mexico is seeking the removal of Section 232 tariffs, while the U.S. is seeking stronger Mexican protections against unfair trade. He said progress on both issues could benefit Ternium and the Mexican market. The Pesquería slab facility is expected to strengthen Ternium’s ability to supply North American customers with locally produced steel, shorter lead times and technical support, Vedoya said. The company expects the facility’s steel to have a lower carbon footprint than blast-furnace-based steel that supplies much of the region’s automotive market. Still, management cautioned that the facility’s impact on 2027 earnings should be limited initially. Vedoya said the mill’s ramp-up will take several quarters, and automotive certifications for more than 2.5 million tons of production will require time. He said Ternium has received more customer inquiries about switching supply to Pesquería than the facility’s available capacity. Capital expenditures were $837 million during the first half, primarily reflecting the Pesquería expansion. Brizzio said the company expects full-year 2026 capital expenditures of $1.6 billion, declining to about $1.2 billion in 2027. During the second quarter, Ternium paid $255 million in dividends, representing the balance of the dividend declared for fiscal 2025. Brizzio said the company could consider higher dividends if improved results prove sustainable, while maintaining a strong balance sheet to support future opportunities. He also said Ternium’s long-term objective includes simplifying its corporate structure, though certain conditions make action involving Usiminas shares difficult in the near term. In Brazil, Vedoya said trade protections have advanced. The country renewed its steel quota system through June 2027, and an anti-dumping case involving Chinese hot-rolled coil is expected to receive a final decision this year. Automotive production is expected to grow 6% in Brazil this year, while road and infrastructure equipment demand remains active, he said. Usiminas has improved profitability through industrial performance, cost controls and productivity gains, Vedoya said. He highlighted completion of a pulverized-coal-injection project, which he described as improving efficiency, reducing costs and lowering emissions intensity. In Argentina, shipments rose sequentially, largely because of seasonality. Vedoya said Ternium continues to see energy, mining and agriculture as the strongest sectors, while construction is recovering gradually from low levels and manufacturing remains weak amid soft demand and import competition. Ternium also updated its 2030 decarbonization target in its 2025 sustainability report. The target now includes Usiminas and uses 2024 as its base year. The company aims to reduce emissions intensity per ton of hot-rolled steel by 50%, covering Scope 1, Scope 2 and Scope 3 emissions under the Greenhouse Gas Protocol methodology. Ternium SA (NYSE:TX) is a leading vertically integrated steel producer with operations across the Americas. The company manufactures a broad range of flat and long steel products, including hot‐rolled and cold‐rolled coils, galvanized and tin-coated sheets, plates, rebars, wire rods, bars and structural sections. These products serve diverse end markets such as automotive, construction, energy, industrial machinery, home appliances and packaging. Established in 2005 through the consolidation of steel assets in Argentina and Mexico, Ternium has grown to operate major production facilities in Argentina, Brazil, Mexico, Colombia, Central America and the United States. 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Ternium S.A. TX used its second-quarter earnings call to signal that improving steel conditions in Mexico and firmer pricing should carry into the third quarter. Management expects adjusted EBITDA to rise sequentially as shipments and revenue per ton improve. The quarter also showed a sharp profitability rebound, though working-capital needs and trade-policy uncertainty remain important constraints. The company reported earnings of $1.75, which topped the Zacks Consensus Estimate of $1.29. Revenues of $4.34 billion missed the consensus mark of $4.37 billion. Ternium S.A. price-consensus-eps-surprise-chart | Ternium S.A. Quote Chief financial officer Pablo Brizzio said that adjusted EBITDA should increase from the second quarter’s $717 million, supported by higher shipments and a better margin. Management expects higher revenue per ton to outweigh rising costs per ton across its markets. The second-quarter adjusted EBITDA margin reached 16.5%, up from 12.2% in the first quarter. Brizzio tied the improvement to stronger realized steel prices, especially in Mexico and Brazil, along with higher consolidated volumes. Chief executive officer Maximo Vedoya said that Mexico’s commercial market is recovering as inventories normalize and trade defenses reduce unfair imports. Ternium is also gaining share because customers value its service, reliability and faster response times. Industrial demand is improving more slowly, with Section 232 tariffs weighing on manufacturing customers. Vedoya said that third-quarter volumes should continue to recover as pipeline projects start, Asian imports are replaced at several automakers and public infrastructure work adds demand beyond the quarter. A Bradesco BBI analyst pressed management on Mexican pricing and whether second-quarter realization understated the benefit from higher market prices. Vedoya said that the mix remains tilted toward the spot-oriented commercial market, but he confirmed that realized prices should rise again in the third quarter at a pace similar to the second quarter. On U.S.-Mexico trade talks, management offered no firm timetable. Vedoya said that Mexico is prioritizing relief from Section 232 tariffs, while the United States wants stronger Mexican defenses against unfair trade. Management reiterated that the new Pesquería slab facility is scheduled to start in early 2027, while downstream lines continue to ramp. Vedoya cautioned that investors should not expect a major EBITDA step-up in 2027. The facility will require several quarters of operational ramping and customer certifications before it reaches its broader earnings potential. He added that customer inquiries for regional melt-and-pour steel exceed the plant’s planned capacity as industrial customers prepare to source more locally produced automotive steel. Capital allocation drew repeated questions from Goldman Sachs and Itaú BBA analysts as earnings improved and the investment cycle neared its peak. Vedoya said that capital spending should fall from about $1.6 billion in 2026 to roughly $1.2 billion in 2027, with management focused on ramping and consolidating recently completed assets. Brizzio said that a higher dividend remains under consideration if stronger results prove sustainable, while preserving a strong financial position. He also described corporate simplification, including additional Usiminas ownership, as a long-term objective rather than a near-term action. In Brazil, Vedoya said that trade defenses are moving in a constructive direction, while automotive and infrastructure equipment demand remain resilient. Usiminas has improved profitability through better industrial execution, cost control and productivity. Still, several end markets face weak demand or competition from imported finished goods. In Argentina, management continues to see energy, mining and agriculture as the strongest sectors. Construction is recovering gradually, while manufacturing remains pressured by soft demand and imports. Management’s tone combined confidence in near-term margin recovery with caution on trade policy, project ramping and cash deployment. The operating focus is clear: capture Mexico’s recovery, defend regional markets, complete Pesquería and preserve balance-sheet flexibility as capital spending declines. TX carries a Zacks Rank #3 (Hold). Its Value Score of A, Growth Score of B and VGM Score of A indicate favorable characteristics in those styles, while the Momentum Score of D points to weaker momentum characteristics.  You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. The Zacks framework gives the strongest preference to Zacks Rank #1 or 2 (Buy) stocks paired with A or B Style Scores. TX combines strong Value, Growth and VGM grades with a lower Momentum grade and a Hold rank. The Zacks Rank can change as earnings estimates are revised after the just-reported results. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ternium S.A. (TX) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Adjusted EBITDA: 50% higher sequentially in Q2 2026. Adjusted EBITDA Margin: Expanded to 16.5% in Q2 2026, up from 12.2% in Q1 2026. Net Income: Reached $465 million in Q2 2026. Net Debt: $112 million at the end of June 2026, compared to a net cash position of $327 million at the end of March 2026. Consolidated Shipments: Increased by 4% sequentially in Q2 2026. Steel Cash Operating Income: Rose by $240 million sequentially in Q2 2026. Working Capital: $418 million build-up in Q2 2026, consistent with higher sales and increased raw material prices. Dividend Paid: $255 million during Q2 2026. First Half Adjusted EBITDA: $1.2 billion, rising 65% year over year. First Half EBITDA Margin: Expanded to 14% from 9% in the same period of last year. First Half Net Income: $837 million, resulting in earnings of $2.84 per ADS. First Half Cash from Operations: $473 million. First Half Capital Expenditure: $837 million. Full-Year 2026 CapEx Guidance: Expected at $1.6 billion, moderating to around $1.2 billion next year. Warning! GuruFocus has detected 12 Warning Signs with TX. Is TX fairly valued? Test your thesis with our free DCF calculator. Release Date: August 05, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Adjusted EBITDA rose 50% sequentially in Q2 2026, with margin expanding to 16.5% from 12.2% in Q1. Strong balance sheet with net debt of only $112 million, despite a $418 million working capital build-up. Mexico shipments and margins improved, supported by effective trade defense measures and market share gains in the commercial segment. New downstream lines at Pesqueria are ramping up, with the slab facility on track for early 2027 startup, positioning Ternium for a more integrated North American market. Brazil's trade defense is advancing, including renewal of the steel quota system until June 2027 and an anti-dumping case on Chinese HRC nearing a final decision. Usiminas improved profitability through better industrial performance, strict cost control, and completion of the pulverized coal injection project. Expectations for continued sequential EBITDA growth in Q3 2026, driven by higher shipments and improved margins. CapEx is expected to decline to $1.6 billion in 2026 and further to around $1.2 billion in 2027, freeing up cash flow. Strong customer recognition, including Caterpillar's Supplier Excellence award and GM's Supplier of the Year in Brazil. Revised 2030 decarbonization target now includes Usiminas, aiming for a 50% reduction in emissions intensity per ton of hot-rolled steel. Section 232 tariffs are negatively impacting industrial customers in Mexico, causing caution and affecting the sales mix. US-Mexico trade talks have not yet produced concrete results, with a fourth round scheduled for early September, leaving uncertainty. Steel demand in Mexico's industrial market is not growing at the same pace as the commercial market, with auto sector and HVAC showing mixed trends. Global steel overcapacity persists, necessitating continued trade defense efforts. Working capital build-up of $418 million in Q2, driven by higher sales and increased raw material costs, impacted cash flow. Net debt position of $112 million at end of June, compared to a net cash position of $327 million at end of March, reflecting higher working capital and dividend payments. First-half cash from operations declined year-over-year due to higher working capital needs. Pesqueria slab facility ramp-up will take several quarters, with no significant EBITDA impact expected in 2027 due to certification processes. Uncertainty in the global economy remains, with management cautious about capital allocation and dividend increases. Mexico's steel consumption is still recovering from a 10% decline in 2025, with only a 4% growth expected this year. Q: Can you provide more color on the expected EBITDA impact from the Pesqueria slab facility in 2027, including reduced slab purchases and other cost changes?A: Maximo Vedoya (CEO) explained that while the slab facility will start at the beginning of 2027, it is a complex project with a ramp-up that will take several quarters. He cautioned against expecting a significant EBITDA impact in 2027, as the focus will be on ramping up production and completing the lengthy certification process for over 2.5 million tons of capacity. The facility's strategic value lies in supplying locally melted and poured steel to automotive customers, which is becoming a requirement under the new USMCA framework. Q: How is the company thinking about capital allocation, dividend increases, and the possibility of acquiring the remaining Usiminas shares given the upcoming reduction in CapEx?A: Pablo Brizzio (CFO) stated that with the peak of the CapEx cycle behind them, the company will have room to consider two main priorities: increasing dividends if the improved results are sustained, and maintaining a strong financial position to take advantage of future opportunities. Regarding Usiminas, he noted that simplifying the corporate structure is a long-term goal, but certain conditions regarding the shares make it difficult to move forward in the short run. Q: Given the strong price realization in Q2, should we expect an even stronger sequential increase in price realization in Q3, and how do you see the Mexican market environment evolving?A: Maximo Vedoya (CEO) confirmed that price realization should continue to improve in Q3, similar to the Q2 trend. However, he noted that the sales mix is currently skewed toward the commercial market, which is more spot-priced, due to Section 232 tariffs affecting industrial customers. He expects Mexican steel demand to grow around 4% this year, with Ternium gaining market share against imports. Q: What is the potential incremental steel demand from the Mexican infrastructure projects, and is this impact coming earlier than anticipated?A: Maximo Vedoya (CEO) clarified that while infrastructure projects are gaining momentum, they are discussing projects totaling around 600,000 to 700,000 tons with the Mexican administration. However, these are long-term projects that will develop over at least 1.5 to 2 years, so the impact on volumes in the coming quarters will be limited. Q: Could dividends be raised back to prior levels or even above, given the improving earnings and reduced uncertainty?A: Maximo Vedoya (CEO) and Pablo Brizzio (CFO) acknowledged that the conditions for a dividend increase are improving, with better results and reduced CapEx. While the company remains cautious due to ongoing global uncertainty, they confirmed that returning capital to shareholders is a key priority and that a dividend increase is a clear possibility if the improved performance is sustained. Q: How do you view the large price gap between HRC prices in Mexico and the US, and what could trigger a narrowing of this spread?A: Maximo Vedoya (CEO) attributed the gap primarily to the Section 232 tariffs in the US and less effective trade measures in Mexico, rather than differences in lead times or inventory levels. He expects the gap to close once the US-Mexico trade discussions reach a conclusion, as Mexico is seeking removal of 232 tariffs while the US is pushing for stronger trade defenses in Mexico. Q: Do you see the restart of Gary Works and Nucor's new capacity as risks that could cause a price inflection point in the US market?A: Maximo Vedoya (CEO) downplayed these risks, noting that US steel demand is expected to increase and that new capacity should be absorbed by demand growth and reduced imports. While there could be temporary moments of oversupply, he does not foresee a huge impact on prices from the restart of these capacities. Q: What is the mood among industrial customers in Mexico, and how are they reacting to the potential removal of Section 232 tariffs?A: Maximo Vedoya (CEO) stated that customers, especially those of US origin, are waiting for a resolution on the 232 tariffs and USMCA discussions. They believe an agreement will be reached and are not concerned about higher steel prices without the tariffs; rather, they see it as an opportunity to strengthen the regional market and take advantage of integration between Mexico and the US. Q: How are commercial customers in Mexico reacting to the potential for higher steel prices if Section 232 is removed?A: Maximo Vedoya (CEO) explained that commercial customers are more focused on demand growth than on potential price increases. They are expecting growth in construction and infrastructure programs, as Mexican steel consumption decreased by 10% last year and is only expected to recover by 4% this year, still well below the 2023 peak. Q: What is the outlook for the automotive sector in Mexico and the future of the regional auto market?A: Maximo Vedoya (CEO) noted that Mexican auto production remains stable at around 4 million units per year, and OEMs are waiting for a resolution on the 232 tariffs. He highlighted a significant opportunity for integration between Mexico and the US, as the US produces about 8 million units but imports another 8 million, creating room for a stronger regional market. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Ternium S.A. (TX) reported $4.34 billion in revenue for the quarter ended June 2026, representing a year-over-year increase of 10%. EPS of $1.75 for the same period compares to $1.28 a year ago. The reported revenue compares to the Zacks Consensus Estimate of $4.37 billion, representing a surprise of -0.58%. The company delivered an EPS surprise of +35.66%, with the consensus EPS estimate being $1.29. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance. Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance. Here is how Ternium performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts: Steel Segment - Shipments - Total Steel Products: 3,858.00 K Ton versus 3,874.34 K Ton estimated by two analysts on average. Steel Segment - Shipments - Mexico: 2,082.00 K Ton versus the two-analyst average estimate of 2,057.51 K Ton. Steel Segment - Shipments - Brazil: 937.00 K Ton versus 979.46 K Ton estimated by two analysts on average. Steel Segment - Shipments - Southern Region: 519.00 K Ton compared to the 511.75 K Ton average estimate based on two analysts. Steel Segment - Revenue per Ton - Total Steel Products: $1,072.00 versus the two-analyst average estimate of $1,076.77. Steel Segment- Net Sales- Brazil: $989 million compared to the $1 billion average estimate based on two analysts. Steel Segment- Net Sales- Mexico: $2.22 billion versus $2.22 billion estimated by two analysts on average. Steel Segment- Net Sales- Other Markets: $378 million compared to the $360.19 million average estimate based on two analysts. Steel Segment- Net Sales- Total Steel Products: $4.14 billion versus $4.13 billion estimated by two analysts on average. Steel Segment- Net Sales- Total Steel Segment: $4.19 billion compared to the $4.23 billion average estimate based on two analysts. Steel Segment- Net Sales- Other Products: $56 million versus $95.07 million estimated by two analysts on average. Steel Segment- Net Sales- Southern Region: $551 million versus $541.12 million estimated by two analysts on average. View all Key Company Metrics for Ternium here>>> Shares of Ternium have returned +17.2% over the past month versus the Zacks S&P 500 composite's +1.7% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ternium S.A. (TX) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

LUXEMBOURG, LU / ACCESS Newswire / August 4, 2026 / Ternium S.A. (NYSE:TX) today announced its results for the second quarter and first half ended June 30, 2026. The financial information contained in this press release is based on Ternium S.A.'s consolidated condensed interim financial statements prepared in accordance with IAS 34 "Interim financial reporting" (IFRS). Interim financial figures are unaudited. The financial and operational information is presented in U.S. Dollars ($) and metric tons, except otherwise indicated. This press release includes certain non-IFRS alternative performance measures such as Adjusted EBITDA, Cash Operating Income, Free Cash Flow, Net Debt and Net Cash. The reconciliation of these figures to the most directly comparable IFRS measures is included in Exhibit I. Second Quarter of 2026Highlights Note: Figures compared to first quarter of 2026. Summary of Second Quarter of 2026 Note: Each American Depositary Share, or ADS, represents 10 shares of Ternium's common stock. Results are based on a weighted average number of shares of common stock outstanding (net of treasury shares) of 1,963,076,776. Second Quarter of 2026Highlights Ternium delivered a robust performance in the second quarter of 2026. Adjusted EBITDA rose sequentially by 50% to $717 million, driven by higher sales volumes and better margins. In Mexico, steel market fundamentals continued to strengthen, amid the implementation of more effective measures against unfairly traded steel imports and the normalization of inventories across the value chain. Likewise, the measures adopted by the Brazilian government to promote fair competition contributed to a more constructive business sentiment across the domestic steel industry. Meanwhile, sales volumes in the Southern Region rebounded in line with seasonal demand trends. The company's net income in the second quarter of 2026 reached $465 million. Capital expenditures amounted to $431 million during the second quarter. The construction of Ternium's new steel shop at its industrial center in Pesquería, Mexico, is progressing on schedule. In May 2026, the company paid a dividend to shareholders of $255 million, corresponding to the balance of the total dividend declared for the year 2025. Meanwhile, cash flow from operating activities amounted to $256 million after a $418 million increase in working capital, primarily in connection with higher sales and increased costs. The company recorded a Net Debt position of $112 million at the end of June 2026, compared to Net Cash position of $327 million at the end of March 2026. Outlook Ternium expects Adjusted EBITDA to increase in the third quarter of 2026 compared to the second quarter, driven by higher shipments and an improved Adjusted EBITDA margin. The margin expansion should reflect higher revenue per ton, partially offset by an increase in cost per ton. In Mexico, the company expects shipments to continue recovering in the third quarter of 2026, as the commercial market keeps its momentum. New pipeline projects and the substitution of Asian imported steel at several OEMs are starting to generate additional volumes, while public infrastructure works should provide further support beyond the quarter. In Brazil, steel demand remains uneven, with resilience in the automotive industry and in infrastructure equipment offset by weaker demand from agricultural machinery. High imports of steel and of manufactured goods with steel content continue to weigh on the market. Trade defense is nevertheless gaining ground, as the steel quota system was renewed until June 2027 and a final decision on the antidumping case on hot rolled coils from China is expected in the coming months. In Argentina, energy, mining and agriculture are expected to remain strong, with construction recovering gradually from still low levels. Manufacturing activity remains weaker, held back by soft domestic demand and strong competition from imports. Analysis of Second Quarter of 2026 Results Consolidated Net Sales Adjusted EBITDA Adjusted EBITDA in the second quarter of 2026 equals Net Income adjusted to exclude: Depreciation and amortization; Income tax results; Net financial results; Equity in earnings of non-consolidated companies; Provision for ongoing litigation related to the acquisition of a participation in Usiminas; and Reversal of contingencies (Usiminas). And adjusted to include the proportional EBITDA in Unigal (70% participation). Adjusted EBITDA margin equals Adjusted EBITDA divided by net sales. For more information see Exhibit I - Alternative performance measures - "Adjusted EBITDA". Steel Segment Second Quarter of 2026 Results The Steel Segment's net sales increased both sequentially and year-over-year in the second quarter of 2026, driven by higher shipments and revenue per ton. Sequentially, shipment volumes increased in Mexico and the Southern Region, while realized steel prices rose mainly in Mexico and Brazil. Compared to the same period of 2025, the growth in sales volumes was driven by the strength of the Mexican market, which more than offset a decrease in shipments across all other markets. Meanwhile, realized steel prices increased year-over-year in Mexico, Brazil and Other Markets. In Mexico, shipments to the commercial market continued to strengthen, posting significant year-over-year growth in the second quarter of 2026. Sales volumes to industrial customers were broadly stable sequentially, remaining below those in the same period of 2025. In Brazil, sales volumes were largely unchanged sequentially, with Usiminas continuing to prioritize margin over volume. Flat steel imports declined in the second quarter, following the implementation of government measures aimed at curbing import surges and supporting more balanced competitive conditions. In the Southern Region, steel shipments increased sequentially in the second quarter consistent with a seasonal rebound in activity, as underlying demand for steel products remained relatively stable. In Other Markets, shipments in the second quarter of 2026 were broadly stable sequentially. On a year-over-year basis, sales volumes declined primarily due to decreased shipments in the US market. The Steel Segment's Cash Operating Income rose by $240 million sequentially in the second quarter of 2026, driven by higher realized steel prices and greater sales volumes, partially offset by slightly higher unit costs. Year-over-year, the Steel Segment's Cash Operating Income increased by $300 million in the quarter, on higher realized steel prices, increased sales volumes and lower unit costs. Cost per ton declined year-over-year mainly driven by lower raw material and purchased slab costs, aided by the company's ongoing initiatives to improve efficiency. Note: For a reconciliation of the Steel Segment's Cash Operating Income and Cash Operating Income per Ton and Margin to the most directly comparable IFRS measures, see Exhibit I - Alternative performance measures - "Cash Operating Income - Steel Segment". Mining Segment Second Quarter of 2026 Results Net sales in the Mining Segment increased both sequentially and year-over-year in the second quarter of 2026. Sequential growth was primarily driven by the Brazilian operations' seasonal rebound, partially offset by lower realized iron ore prices. Compared with the same period in 2025, the rise in net sales in the second quarter of 2026 was mainly the result of higher realized iron ore prices. The Mining Segment's Cash Operating Income decreased slightly sequentially in the second quarter of 2026, primarily driven by lower realized iron ore prices partially offset by higher sales volumes. On a year-over-year basis, Cash Operating Income rose slightly supported by higher realized iron ore prices, largely offset by increased costs. Note: For a reconciliation of the Mining Segment's Cash Operating Income and Cash Operating Income per Ton and Margin to the most directly comparable IFRS measures, see Exhibit I - Alternative performance measures - "Cash Operating Income - Mining Segment". Net Financial Results Net financial results were a loss of $39 million for the second quarter of 2026, primarily driven by a $34 million loss in foreign exchange results. This amount mainly reflected the negative effect of the appreciation of the Mexican Peso and the Brazilian Real against the US Dollar on net short local currency positions at Ternium's subsidiaries in these countries, and the negative effect of the depreciation of the Argentine Peso against the US Dollar on a net long local currency position at Ternium Argentina. Income Tax Results Ternium's subsidiaries use the U.S. dollar as their functional currency; as a result, fluctuations between their local currencies and the U.S. dollar lead to the recognition of deferred tax results. In the second quarter of 2026, the company recorded a deferred tax gain of $86 million mainly driven by the positive effect of the appreciation of the Mexican Peso against the US Dollar. Net Income In the second quarter of 2026, Ternium's net income amounted to $465 million. Equity Holder's Net Income was $344 million in the period, or $1.75 per ADS, mainly after accounting for the participation of a 62.5% non-controlling interest in Usiminas and a 37.4% non-controlling interest in Ternium Argentina. Cash Flow and Liquidity In the second quarter of 2026, cash from operations amounted to $256 million. Working capital increased by $418 million reflecting a $205 million increase in trade and other receivables and a $223 million increase in inventories, partially offset by a $10 million net increase in trade payables and other liabilities. Capital expenditures totaled $431 million, primarily reflecting the progress made in the construction of the new steel shop at Ternium's industrial center in Pesquería, Mexico. Alongside the development of its capital expenditure program, in the second quarter of 2026 Ternium paid a dividend to shareholders of $255 million, corresponding to the balance of the total dividend declared for the year 2025. In addition, the company paid dividends to non-controlling interest totalling $36 million. Ternium recorded a Net Debt position of $112 million at the end of June 2026, compared to Net Cash position of $327 million as of the end of March 2026. Conference Call and Webcast Ternium will host a conference call on August 5, 2026, at 8:00am ET in which management will discuss second quarter of 2026 results. A webcast link will be available in the Investor Center section of the company's website at www.ternium.com. Forward Looking Statements Some of the statements contained in this press release are "forward-looking statements". Forward-looking statements are based on management's current views and assumptions and involve known and unknown risks that could cause actual results, performance or events to differ materially from those expressed or implied by those statements. These risks include but are not limited to risks arising from uncertainties as to gross domestic product, related market demand, global production capacity, tariffs, cyclicality in the industries that purchase steel products, and other factors beyond Ternium's control. About Ternium Ternium is a leading steel producer in the Americas, providing advanced steel products to a wide range of manufacturing industries and the construction sector. We invest in low carbon emissions steelmaking technologies to support the energy transition and the mobility of the future. We also support the development of our communities, especially through educational programs in Latin America. More information about Ternium is available at www.ternium.com. Income Statement Statement of Financial Position Statement of Financial Position (cont.) Statement of Cash Flows Exhibit I - Alternative Performance Measures These non-IFRS measures should not be considered in isolation of, or as a substitute for, measures of performance prepared in accordance with IFRS. These non-IFRS measures do not have a standardized meaning under IFRS and, therefore, may not correspond to similar non-IFRS financial measures reported by other companies. Adjusted EBITDA Exhibit I - Alternative Performance Measures (cont.) Cash Operating Income - Steel Segment Cash Operating Income - Mining Segment Exhibit I - Alternative Performance Measures (cont.) Free Cash Flow Net Debt Note: Ternium Argentina's consolidated position of cash and cash equivalents and other investments amounted to $0.7 billion and $0.8 billion as of June 30 and March 31, 2026, and $1.0 billion as of June 30, 2025. Contact: Sebastián MartíTernium - Investor Relations+1 (866) 890 0443+54 (11) 4018 8389www.ternium.com SOURCE: Ternium S.A. View the original press release on ACCESS Newswire

Ternium S.A. TX is set to release second-quarter 2026 results after the closing bell on Aug. 4.The company beat the Zacks Consensus Estimate for earnings in two of the last four quarters and missed twice. It has a trailing four-quarter earnings surprise of 3.5% on average.  TX is expected to have benefited from margin gains from higher realized prices, continued demand recovery in Mexico and stable consumption in Brazil amid headwinds from input cost inflation in the second quarter.TX’s shares have gained 53.7% in a year, underperforming the Zacks Steel Producers industry’s 79.1% rise. Image Source: Zacks Investment Research Let’s see how things are shaping up for this announcement. Our proven model predicts an earnings beat for Ternium this time around. The combination of a positive Earnings ESP  and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.Earnings ESP: Earnings ESP for TX is +21.40%. The Zacks Consensus Estimate for the second quarter is currently pegged at $1.29. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.Zacks Rank: TX currently carries a Zacks Rank #3. The Zacks Consensus Estimate for TX’s second-quarter consolidated sales is currently pegged at $4,365.1 million, calling for an increase of 10.6% from the year-ago quarter’s tally.The consensus estimate for total steel segment net sales is pegged at $4,225 million, indicating a 10.8% year-over-year increase. Ternium is expected to have benefited from healthy demand for steel products and higher steel prices across key markets in the second quarter, leading to improved margins. Its shipments in Mexico are likely to have been aided by a recovery in demand in the commercial market following last year’s destocking. Infrastructure projects are expected to have contributed to demand, supporting shipments. Steel demand in Brazil remains largely stable. Demand in automotive remains strong in that country, while trade measures taken by the government have led to improved fundamentals, aiding steel consumption and shipments. Weakness in construction and soft consumption in certain markets, including home appliances, are likely to continue to have impacted the company’s business in Argentina in the quarter to be reported. The company is also expected to have benefited from the cost competitiveness of its facilities and actions to boost liquidity and strengthen its financial position. However, TX is likely to have faced continued headwinds from raw material cost inflation and higher purchased slab costs. It is seeing higher costs for raw materials, including iron ore. Ternium S.A. price-eps-surprise | Ternium S.A. Quote Here are some companies in the basic materials space you may want to consider, as our model shows they too have the right combination of elements to post an earnings beat this quarter:Avient Corporation AVNT, scheduled to release earnings on Aug. 6, has an Earnings ESP of +0.87% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.The consensus estimate for AVNT’s earnings for the second quarter is currently pegged at 89 cents.The Chemours Company CC, scheduled to release earnings on Aug. 4, has an Earnings ESP of +27.17%.The Zacks Consensus Estimate for CC's earnings for the second quarter is currently pegged at 43 cents. CC currently sports a Zacks Rank #2. Materion Corporation MTRN, slated to release earnings on Aug. 5, has an Earnings ESP of +5.39% and carries a Zacks Rank #2 at present.The consensus mark for MTRN’s second-quarter earnings is currently pegged at $1.55. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ternium S.A. (TX) : Free Stock Analysis Report Materion Corporation (MTRN) : Free Stock Analysis Report The Chemours Company (CC) : Free Stock Analysis Report Avient Corporation (AVNT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

LyondellBasell Industries N.V. LYB is set to release second-quarter 2026 results before the opening bell on Friday. LyondellBasell missed the Zacks Consensus Estimate for earnings in two of the trailing four quarters, and beat it twice, with the average negative earnings surprise being 47.2%. The company is expected to have faced headwinds from higher feedstock costs amid improved seasonal demand in the second quarter. LYB's shares are up 4.4% in the past year compared with the Zacks Chemicals Diversified industry’s 1.7% rise. Image Source: Zacks Investment Research Let’s see how things are shaping up for this announcement. Our proven model doesn’t predict an earnings beat for LYB this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here. Earnings ESP: Earnings ESP for LYB is -5.07%. The Zacks Consensus Estimate for the second quarter is currently pegged at $3.56 per share. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. Zacks Rank: LYB currently carries a Zacks Rank #3. The Zacks Consensus Estimate for second-quarter consolidated revenues for LYB is currently pegged at $8,900.6 million, implying a year-over-year increase of 16.2%. For the Olefins and Polyolefins – Americas division, the consensus estimate is $3,456 million, suggesting a year-over-year rise of 26.5%. The same for the Olefins and Polyolefins – Europe, Asia & International division is pegged at $3,243 million, implying a 24.7% increase from last year’s tally. For LYB’s Advanced Polymer Solutions (APS) segment, the Zacks Consensus Estimate for second-quarter revenues is $973 million, suggesting a 5.1% rise year over year. The consensus estimate for the Intermediaries and Derivatives segment’s revenues is pinned at $2,606 million, suggesting a 12.2% rise from the year-ago reported figure. The same for the Technology segment's revenues is pegged at $163 million, indicating a 12.4% fall from a year ago. LyondellBasell is expected to have benefited from a stronger operating environment in the second quarter, supported by tightening global petrochemical supply, improving pricing and higher operating rates. Ongoing geopolitical tensions in the Middle East have disrupted energy and petrochemical supply chains, reducing production and exports from key regions. Management expects these supply disruptions to persist for several quarters, creating structurally tighter supply-demand balances across polyethylene, polypropylene and other petrochemical products. This environment is expected to have driven stronger export demand, higher product prices and improved margins. North America is expected to have been LYB's strongest growth driver in the second quarter, supported by improving seasonal demand, higher polyethylene and polypropylene prices, and robust export demand. Tight global supply is expected to have kept the company's North American assets running at around 90% of nameplate capacity, boosting volumes and margins. Europe is expected to have seen improved demand, stronger polymer margins and an operating rate of around 80%, supported by lower imports from the Middle East and China. The recent sale of four European assets might have further strengthened LYB's portfolio and improved profitability. The Intermediates & Derivatives segment is expected to have benefited from stronger seasonal demand, improved oxyfuels margins and the restart of the Bayport PO/TBA facility by the end of the second quarter. The Bayport outage reduced first-quarter EBITDA by around $40 million and is estimated to have negatively impacted earnings by roughly $25 million per week while the asset remained offline, making its restart a key catalyst for second-quarter profitability. The APS segment is expected to have faced mixed conditions. While automotive and other durable goods markets remain soft, the company is actively passing through higher raw material, energy and logistics costs to customers. Although contractual pricing mechanisms may temporarily delay margin recovery, customer demand has remained relatively resilient in packaging and other essential end markets, supporting the company's long-term transformation strategy. LYB continues to execute initiatives aimed at strengthening profitability and cash generation. The company remains focused on its portfolio transformation, disciplined capital allocation and cost-reduction efforts under its Cash Improvement Plan. Management is targeting $500 million of incremental cash flow in 2026, bringing cumulative improvements since 2025 to $1.3 billion. Lower fixed costs, improved working capital management and ongoing productivity initiatives are expected to have further supported earnings in the June quarter despite higher raw material and logistics costs. LyondellBasell Industries N.V. price-eps-surprise | LyondellBasell Industries N.V. Quote Here are some companies in the basic materials space you may want to consider, as our model shows they have the right combination of elements to post an earnings beat this quarter: The Chemours Company CC, scheduled to release earnings on Aug. 4, has an Earnings ESP of +27.17% and carries a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here. The consensus estimate for CC’s second-quarter earnings is currently pegged at 43 cents per share. Avient Corporation AVNT, scheduled to release earnings on Aug. 6, has an Earnings ESP of +0.87% and carries a Zacks Rank #2 at present. The consensus mark for AVNT’s second-quarter earnings is currently pegged at 89 cents per share. Ternium S.A. TX, slated to release earnings on Aug. 4, has an Earnings ESP of +21.4%. The Zacks Consensus Estimate for TX's second-quarter earnings is currently pegged at $1.29 per share. TX currently carries a Zacks Rank #1. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report LyondellBasell Industries N.V. (LYB) : Free Stock Analysis Report Ternium S.A. (TX) : Free Stock Analysis Report The Chemours Company (CC) : Free Stock Analysis Report Avient Corporation (AVNT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Materion Corporation MTRN is set to release its second-quarter 2026 results on Aug. 5, before market open. The Zacks Consensus Estimate for Materion’s second-quarter revenues is pegged at $548.1 million, suggesting year-over-year growth of 27%. Over the past 60 days, the earnings estimate for second-quarter 2026 has moved up 0.65% to $1.55 per share. The figure reflects a 13% increase from the year-ago quarter’s earnings of $1.37 per share. Image Source: Zacks Investment Research Over the trailing four quarters, Materion’s earnings beat the Zacks Consensus Estimate thrice and matched the same in the remaining quarter. MTRN has an average trailing four-quarter earnings surprise of 4.96%. The trend is shown in the chart below. Image Source: Zacks Investment Research Our proven model predicts an earnings beat for Materion this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is the case here, as you can see below. Earnings ESP: The Earnings ESP for Materion is +5.39%. You can uncover the best stocks before they are reported with our Earnings ESP Filter. Zacks Rank: MTRN currently carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here. In the first quarter of 2026, value-added (VA) sales, which exclude the impact of pass-through precious metal costs, increased 1% year over year to $261.8 million, including precision clad strip. Lower precision clad strip sales due to the ongoing production ramp weighed on overall growth. Excluding precision clad strip, VA sales climbed 10%, driven by broad-based strength across the company's portfolio. Materion’s order book remained robust heading into the second quarter. The company had noted that over the last 12 months, Aerospace & Defense orders were up around 50%, energy order rates were up 20% and semiconductor order rates were up 10%. Materion exited the first quarter with a record backlog, up 20% year over year, reflecting strong momentum from new business wins and favorable end-market demand. These trends are expected to support second-quarter results. Adjusted EBITDA increased 9% year over year to $52.9 million in the first quarter, while adjusted EBITDA margin expanded 140 basis points to a record 20.2% of VA sales. The improvement was driven by higher volumes, favorable pricing and mix, and strong operational execution in the Electronic Materials and Precision Optics businesses. Overall, Materion is expected to have delivered a solid second-quarter performance, supported by healthy demand across key end markets, a record backlog and continued operational improvements. In Electronic Materials, first-quarter 2026 VA sales rose 18% year over year to $91.6 million, supported by robust semiconductor demand as well as strength in industrial, life sciences, and aerospace & defense markets. Demand continues to benefit from AI-driven investments in high-performance memory and data storage, alongside improving trends in power applications and communications devices. The segment generated record adjusted EBITDA of $25.9 million, up 95% year over year, on higher volumes, improved pricing and mix, and operational efficiencies. EBITDA margin expanded to 28.3%, marking the fourth straight quarter of year-over-year margin improvement. Momentum is expected to have continued in the second quarter, aided by semiconductor market growth and recent business wins. The Zacks Consensus Estimate for second-quarter Electronic Materials VA sales is $96 million, indicating 26% year-over-year growth. Adjusted EBITDA is projected at $26.1 million, or 27% of VA sales, representing a 47% increase from the prior-year quarter. If achieved, the segment would deliver its fifth consecutive quarter of margin expansion. In Precision Optics, first-quarter VA sales of $30.7 million marked a 43% year-over-year increase and the highest quarterly sales since 2021. Growth was fueled by new program wins and improving demand across all major end markets. Adjusted EBITDA improved to $5.5 million, or 17.9% of VA sales, against a loss of $0.1 million in the year-ago quarter. Higher volumes, favorable product mix and continued execution of the business transformation strategy drove the sharp turnaround. The favorable trends are expected to have carried into the second quarter. The Zacks Consensus Estimate calls for Precision Optics VA sales of $31.8 million, reflecting 30% year-over-year growth. Adjusted EBITDA is projected at $5.1 million, or 16% of VA sales, more than doubling from the year-ago quarter. This would mark the segment's sixth consecutive quarter of year-over-year margin expansion. The Performance Materials segment witnessed a 13% decline in VA sales to $139.5 million in the first quarter primarily due to lower precision clad strip shipments during the production ramp. Excluding this business, performance was largely stable, as strength in aerospace & defense and telecom & data center offset softer energy sales caused by shipment timing. Adjusted EBITDA was down 32% to $28 million, or 20.1% of VA, reflecting lower precision clad strip volumes and unfavorable operational performance carried over from the prior year. However, the order book continues to build, driven by strong demand in aerospace and defense, energy, and telecom and data center. Management expected a sequential step up in both top and bottom lines in the second quarter, led by stronger aerospace & defense and PMI shipments. The Zacks Consensus Estimate for VA sales for the second quarter for the Performance Materials segment is $173 million, implying 2% year-over-year growth and an 11% sequential increase. Adjusted EBITDA projection is $39.5 million, a 5% dip compared with the prior-year quarter but a 41% jump from the first quarter of 2026. Materion shares have gained 79.8% in a year compared with the industry’s 35.2% growth. Image Source: Zacks Investment Research ATI Inc. ATI is slated to report its second-quarter 2026 results on Aug. 6, before market open. It has an Earnings ESP of +1.32% and a Zacks Rank of 2 at present. The Zacks Consensus Estimate for ATI’s second-quarter earnings is pegged at $1.03 per share, which suggests a year-over-year rise of 39.2%. ATI has an average earnings surprise of 8.6% over the trailing four quarters. Here are two Basic Materials stocks, which according to our model, also have the right combination of elements to post an earnings beat in their upcoming release. Ternium TX, scheduled to release second-quarter 2026 earnings on Aug. 4, has an Earnings ESP of +21.40% and a Zacks Rank of 1 at present. The Zacks Consensus Estimate for earnings for Ternium for the second quarter of 2026 is pegged at $1.29 per share, suggesting an 0.8% year-over-year increase. TX has a trailing four-quarter average earnings surprise of 3.51%. Avient Corporation AVNT, scheduled to release second-quarter 2026 earnings on Aug. 6, has an Earnings ESP of +0.87% and a Zacks Rank of 2 at present. The Zacks Consensus Estimate for earnings for Avient for the second quarter of 2026 is 89 cents per share, indicating an 11.2% year-over-year increase. Avient has a trailing four-quarter average earnings surprise of 2.1%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Materion Corporation (MTRN) : Free Stock Analysis Report ATI Inc. (ATI) : Free Stock Analysis Report Ternium S.A. (TX) : Free Stock Analysis Report Avient Corporation (AVNT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research