GUADALAJARA, Mexico, Oct. 27, 2022 /PRNewswire/ -- Grupo Simec, S.A.B. de C.V. (NYSE: SIM) ("Simec") announced today its results of operations for the nine-month period ended September 30, 2022 .
Comparative first nine months of 2022 vs. first nine months of 2021
Net Sales
Net sales of the Company increased to Ps. 44,012 million in the first nine months of 2022 compared to Ps. 42,736 million in the first nine months of 2021. Shipments of finished steel products decreased 12% to 1 million 720 thousand tons in the first nine months of 2022 compared to 1 million 954 thousand tons in the first nine months of 2021. Total sales outside of Mexico in the first nine months of 2022 decreased 2% to Ps. 20,812 million compared to Ps. 21,297 million in the same period of 2021. Mexican sales increased 8% from Ps. 21,439 million in the first nine months of 2021 to Ps. 23,200 million in the same period of 2022. The increase in sales for the first nine months of 2022 is due to an increase in the average selling price in 17% and with a lower volume of shipments compared to the first nine months of 2021.
Cost of Sales
Cost of sales increased 5% from Ps. 30,823 million in the first nine months of 2021, to Ps. 32,243 million in the first nine months of 2022. Cost of sales as a percentage of net sales represented 73% in the first nine months of 2022 while in the first nine months of 2021 represented 72%. Cost of sales by steel ton increased approximately 19% in the first nine months of 2022 over the same period of 2021 due to a higher price in inputs, mainly steel scrap.
Gross Profit
Gross profit of the Company for the first nine months of 2022 decreased 1% from Ps. 11,913 million in the first nine months of 2021, to Ps. 11,769 million in the first nine months of 2022. Marginal profit as percentage of net sales in the first nine months of 2022 was of 27% while in the first nine months of 2021 was of 28%. The decrease in gross profit is due to a lower volume shipped.
General, Selling and Administrative Expenses
Selling, general and administrative expenses increased 16%, to Ps. 1,725 million in the first nine months of 2022 from Ps. 1,492 million in the same period of 2021, selling, general and administrative expenses represented 4% to the 2022 and 3% to the 2021 of the net sales for both periods.
Other Income (Expenses,) net
The Company recorded other income net for Ps. 7 million during the first nine months of 2022 while in the same period of 2021 the other expenses net by this concept was of Ps. 50 million.
Operating Income
Operating income decreased 3% to Ps. 10,051 million for the first nine months of 2022 compared to Ps. 10,371 million in the first nine months of 2021. Operating income as percentage of net sales was 23% in the first nine months of 2022 and 24% in the same period of 2021. The decrease in operating income is due to a lower volume shipped during the nine months ended September 30, 2022 compared to the same period in 2021.
Ebitda
The Ebitda decreased 3%, from Ps. 11,257 million in the first nine months of 2021 as a result of a net income of Ps. 8,290 million, plus minority stake of Ps. 1 million, plus income taxes of Ps. 2,305 million, less comprehensive financial cost of Ps. 225 million, plus depreciation of Ps. 886 million to Ps 10,885 million in the same period of 2022 as a result of a net income of Ps. 8,037 million, plus income taxes of Ps. 1,950 million, plus comprehensive financial cost of Ps. 64 million, plus depreciation of Ps. 834 million.
Consolidated | |||||||
Million | Comparative first nine months of 2022 vs first nine months of 2021, | ||||||
2022 | 2021 | ||||||
Net income (loss) | 8,037 | 8,290 | |||||
Loss attributable to noncontrolling interests | 1 | ||||||
Net income (loss) | 8,037 | 8,291 | |||||
Depreciation, depletion and amortization | 834 | 886 | |||||
Income taxes | 1,950 | 2,305 | |||||
Financial results income (loss) | 64 | (225) | |||||
EBITDA | 10,885 | 11,257 | |||||
Items to reconciled adjusted EBITDA | |||||||
Equity results and other results in associates and joint ventures | 0 | 0 | |||||
Dividends received and interest from associates and joint ventures (i) | 0 | 0 | |||||
Impairment and disposal of non-current assets | 0 | 0 | |||||
Adjusted EBITDA | 10,885 | 11,257 | |||||
Comprehensive Financial Cost
Comprehensive financial cost for the first nine months of 2022 represented an expense of Ps. 64 million compared with an income of Ps. 225 million for the first nine months of 2021. The net interest income was of Ps. 103 million for the first nine months of 2022, compared with a net interest expense of Ps. 35 million in the same period of 2021. Likewise, we record an exchange expense of Ps. 198 million in the first nine months of 2022 compared with an exchange income of Ps. 260 million in the first nine months of 2021, and other financial income for Ps 31 million was recorded as of September 30, 2022, dividends earned on purchase of shares.
Income Taxes
The Company recorded an expense of Ps.1,950 million for the net income tax during the first nine months of 2022, (includes a deferred expense tax of Ps. 47 million) compared with an expense of Ps. 2,305 million of income tax for the first nine months of 2021 (includes a deferred expense tax of Ps. 97 million).
Net Income
As a result of the foregoing, the Company recorded an decrease in net income of 3% to pass of Ps. 8,290 million in the first nine months of 2021 to Ps. 8,037 million of the same periods of 2022.
Liquidity and Capital Resources
At September 30, 2022, Simec's total consolidated debt consisted of U.S. $ 302,000 of 8 7/8% medium-term notes ("MTN's") due 1998, or Ps. 6.1 million (accrued interest on September 30, 2022 was U.S. $ 691,000, or Ps. 14.0 million). At December 31, 2021, Simec's total consolidated debt consisted of U.S. $ 302,000 of 8 7/8% medium-term notes ("MTN's") due 1998, or Ps. 6.2 million (accrued interest on December 31, 2021 was U.S. $ 671,400, or Ps. 13.8 million).
Comparative third quarter of 2022 vs. second quarter of 2022
Net Sales
Net sales of the Company decreased to pass of Ps. 15,547 million during the second quarter of 2022 to Ps. 13,433 million in the third quarter of 2022. Shipments of finished steel products decreased to 541 thousand tons in the third quarter of 2022 from 556 thousand tons in the second quarter of the same year. Total sales outside of Mexico in the third quarter of 2022 decreased 10% to get to Ps. 6,559 million compared to Ps. 7,276 million of the second quarter of the same year. Mexican sales in the third quarter of 2022 decreased to Ps. 6,874 million compared to Ps. 8,271 million in the second quarter of the same year. The average selling price decreased 11% in the third quarter of 2022 compared to the second quarter of the same year.
Cost of Sales
Cost of sales decreased to P s. 10,271 million in the third quarter of 2022 from Ps.10,783 million in the second quarter of 2022. Cost of sales as a percentage of net sales represented 76% in the third quarter of 2022 and 69% in the second quarter of the same year. The cost of sales decrease 5% in the third quarter of 2022 compared to the second quarter of the same year, due mainly to a decrease of some supplies for the manufacture of steel and a lower volume of shipments.
Gross Profit
Gross profit of the Company for the third quarter of 2022 decreased 34% to pass of Ps. 4,764 million in the second quarter of 2022 to Ps. 3,162 million in the third quarter of same year. Gross profit as a percentage of net sales in the third quarter of 2022 was of 24% compared to 31% in the second quarter of the same year. The decreased in the gross profit is due to decrease in average selling price and the lowe volume shipped in the third quarter compared to the second quarter of 2022.
General, Selling and Administrative Expenses
Selling, general and administrative expenses decreased 3% to of Ps. 595 million in the third quarter of 2022 from Ps. 612 million the second quarter of the same year, and as percentage of net sales represented 4% for both periods quarter of the same year.
Other (Expenses) Income, net
The Company recorded other income net for Ps. 5 million during the third quarter of 2022 compared to other income net for Ps. 2 million in the second quarter of 2022.
Operating Income
The Operating income was of Ps. 2,572 million in the third quarter of 2022 compared to Ps. 4,154 million in the second quarter of the same year. Operating income as percentage of net sales represented 19% for the third quarter of 2022 and 27% for the second quarter of 2022.
Ebitda
The Ebitda show a decrease of 35%, to pass of Ps 4,424 million in the second quarter of 2022 as a result of a net income of Ps. 3,604 million, plus income taxes of Ps. 693 million, less comprehensive financial cost of Ps. 143 million, plus depreciation of Ps. 270 million to Ps. 2,857 million in the third quarter of the same year as a result of a net income of Ps. 1,940 million, less minority stake of Ps. 1 million, plus income taxes of Ps. 798 million, less comprehensive financial cost of Ps. 165 million, plus depreciation of Ps. 285 million.
| Consolidated | |||||||
Million | Comparative third quarter of 2022 vs second quarter of 2022, | ||||||
Third quarter 2022 | Second quarter 2022 | ||||||
Net income (loss) | 1,940 | 3,604 | |||||
Loss attributable to noncontrolling interests | (1) | ||||||
Net income (loss) | 1,939 | 3,604 | |||||
Depreciation, depletion and amortization | 285 | 270 | |||||
Income taxes | 798 | 693 | |||||
Financial results income (loss) | (165) | (143) | |||||
EBITDA | 2,857 | 4,424 | |||||
Items to reconciled adjusted EBITDA | |||||||
Equity results and other results in associates and joint ventures | 0 | 0 | |||||
Dividends received and interest from associates and joint ventures (i) | 0 | 0 | |||||
Impairment and disposal of non-current assets | 0 | 0 | |||||
Adjusted EBITDA | 2,857 | 4,424 | |||||
Comprehensive Financial Cost
Comprehensive financial cost of the Company in the third quarter of 2022 represented an income of Ps. 165 million compared with an income of Ps. 143 million for the second quarter of 2022. The comprehensive financial cost is comprised for: the net interest income of Ps. 104 million in the third quarter of 2022 compared to net interest expense of 29 million in the second quarter of the same year. Also, we record a net exchange income of Ps. 30 million in the third quarter of 2022 compared a net exchange income of Ps. 172 million in the second quarter of the same year, and other financial income for Ps 31 million was recorded as of September 30, 2022, dividends earned on purchase of shares.
Income Taxes
The Company have been recorded Ps. 798 million of expense tax during the third quarter of 2022, (includes a deferred expense tax of Ps. 60 million) compared with the Ps. 693 million of expense for the second quarter of the same year, (includes a deferred income tax of Ps. 5 million).
Net Income
As a result of the foregoing, the Company recorded a net income of Ps. 1,940 million in the third quarter of 2022 compared to a net income of Ps. 3,604 million for the second quarter of 2022.
Comparative third quarter of 2022 vs. third quarter of 2021
Net Sales
Net sales of the Company decreased 5% from Ps. 14,122 million during the third quarter of 2021 to Ps. 13,433 million in the third quarter of 2022. Sales in tons of finished steel decreased to 541 thousand tons in the third quarter of 2022 from 585 thousand tons in the third quarter of 2021. Sales outside of Mexico decreased 4% from Ps. 6,838 million in the third quarter of 2021 to Ps. 6,559 million in the third quarter of 2022. Mexican sales decreased 6% from Ps. 7,284 million in the third quarter of 2021 to Ps. 6,874 million in the third quarter of 2022. The average sales price increased approximately 3% in the third quarter of 2022, compared to the same period of 2021.
Cost of Sales
Cost of sales increased 4% in the third quarter of 2022 compared to the third quarter of 2021 from Ps. 9,913 million in the third quarter of 2021 to Ps. 10,271 million in the third quarter of 2022. With respect to sales, the cost of sales of the third quarter of 2021 represented 70% compared to 76% for the third quarter of 2022. The average cost of raw materials used to produce steel products increased in 12%, due to an increase of raw materials prices, mainly steel scrap.
Gross (Loss) Profit
Gross profit of the Company for the third quarter of 2022 decreased 25% from Ps. 4,209 million in the third quarter of 2021 compared to Ps. 3,162 million in the third quarter of 2022. Gross profit as a percentage of net sales for the third quarter of 2022 was 24% compared to 30% of the third quarter of 2021. The decrease due mainly to a increase of some supplies for the manufacture of steel and with a lower volume of shipments.
General, Selling and Administrative Expenses
The selling, general and administrative expenses increased 17% in the third quarter of 2022 to Ps. 595 million in the third quarter of 2022 from Ps. 508 million in the third quarter of 2021. Selling, general and administrative expense as a percentage of net sales represented 4% for both periods quarter 2022 and 2021.
Other Income (Expenses), net
The company recorded other income net of Ps. 5 million in the third quarter of 2022 compared with other expense net of Ps. 20 million for the third quarter of 2021.
Operating (Loss) Income
Operating income decreased from Ps. 3,681 million in the third quarter of 2021 compared to Ps. 2,572 million in the third quarter of 2022, this represents 30% of decrease between both quarters. The operating income as a percentage of net sales was 19% for the third quarter of 2022 compared to 26% for the third quarter of 2021.The decrease in the operating profit is due to a lower volume shipped, to increased costs and expenses.
Ebitda
The Ebitda of the Company decreased 28% from Ps 3,974 million in the third quarter of 2021 as a result of a net income of Ps. 3,313 million, plus income taxes of Ps. 674 million, less comprehensive financial cost of Ps. 306 million, plus depreciation of Ps. 293 million to Ps. 2,857 million of the same period of 2022, as a result of a net income of Ps. 1,940 million, less minority stake of Ps. 1 million, plus income taxes of Ps. 798 million, less comprehensive financial cost of Ps. 165 million, plus depreciation of Ps. 285 million.
Consolidated | |||||||
Million | Comparative third quarter of 2022 vs third quarter of 2021, | ||||||
Third quarter 2022 | Third quarter 2021 | ||||||
Net income (loss) | 1,940 | 3,313 | |||||
Loss attributable to noncontrolling interests | (1) | ||||||
Net income (loss) | 1,939 | 3,313 | |||||
Depreciation, depletion and amortization | 285 | 293 | |||||
Income taxes | 798 | 674 | |||||
Financial results income (loss) | (165) | (306) | |||||
EBITDA | 2,857 | 3,974 | |||||
Items to reconciled adjusted EBITDA | |||||||
Equity results and other results in associates and joint ventures | 0 | 0 | |||||
Dividends received and interest from associates and joint ventures (i) | 0 | 0 | |||||
Impairment and disposal of non-current assets | 0 | 0 | |||||
Adjusted EBITDA | 2,857 | 3,974 | |||||
Comprehensive Financial Cost
Comprehensive financial cost of the Company for the third quarter of 2022 represented a net income of Ps. 165 million compared with an income of Ps. 306 million for the third quarter of 2021. The comprehensive financial cost is comprised for the net interest expense of Ps. 9 million in the third quarter of 2021, compared to a net interest income of Ps. 104 million for the same period of 2022. Also record an exchange income of Ps. 315 million in the third quarter of 2021 and an exchange income of Ps. 30 million in the third quarter of 2022, and other financial income for Ps 31 million was recorded as of September 30, 2022, dividends earned on purchase of shares.
Income Taxes
The company recorded an expense tax for Ps. 798 million in the third quarter of 2022, (includes a deferred expense tax of Ps. 60 million) compared to an expense tax of Ps. 674 million for the third quarter of 2021, (includes an accrual of deferred expense tax of Ps. 75 million).
Net Income (Loss)
As a result of the foregoing, the Company recorded a net income of Ps. 1,940 million in the third quarter of 2022 compared to a net income of Ps. 3,313 million for the same period of 2021.
(millions of pesos) | Jan - Sep '22 | Jan - Sep '21 | Year 22 vs | ||
Sales | 44,012 | 42,736 | 3 % | ||
Cost of Sales | 32,243 | 30,823 | 5 % | ||
Gross Profit | 11,769 | 11,913 | (1 %) | ||
Selling, General and Administrative Expense | 1,725 | 1,492 | 16 % | ||
Other Income (Expenses), net | 7 | (50) | (114 %) | ||
Operating Profit | 10,051 | 10,371 | (3 %) | ||
EBITDA | 10,885 | 11,257 | (3 %) | ||
Net income | 8,037 | 8,290 | (3 %) | ||
Sales Outside Mexico | 20,812 | 21,297 | (2 %) | ||
Sales in Mexico | 23,200 | 21,439 | 8 % | ||
Total Sales (Tons) | 1,720 | 1,954 | (12 %) | ||
Cost by ton | 18,746 | 15,774 | 19 % |
Quarter | |||||
(millions of pesos) | 3Q'22 | 2Q '22 | 3Q '21 | 3Q'22vs | 3Q'22 vs |
Sales | 13,433 | 15,547 | 14,122 | (14 %) | (5 %) |
Cost of Sales | 10,271 | 10,783 | 9,913 | (5 %) | 4 % |
Gross Profit | 3,162 | 4,764 | 4,209 | (34 %) | (25 %) |
Selling, General and Adm. Expenses | 595 | 612 | 508 | (3 %) | 17 % |
Other Income (Expenses), net | 5 | 2 | (20) | 150 % | (125 %) |
Operating Profit | 2,572 | 4,154 | 3,681 | (38 %) | (30 %) |
EBITDA | 2,857 | 4,424 | 3,974 | (35 %) | (28 %) |
Net Income | 1,940 | 3,604 | 3,313 | (46 %) | (41 %) |
Sales Outside Mexico | 6,559 | 7,276 | 6,838 | (10 %) | (4 %) |
Sales in Mexico | 6,874 | 8,271 | 7,284 | (17 %) | (6 %) |
Total Sales (Tons) | 541 | 556 | 585 | (3 %) | (8 %) |
Cost per Tons | 18,985 | 19,394 | 16,945 | (2 %) | 12 % |
Product | Thousands of Tons Jan-Sep 2022 | Millions of Pesos Jan-Sep 2022 | Average Price per Ton Jan-Sep 2022 | Thousands of Tons Jan - Sep 2021 | Millions of Pesos Jan- Sep 2021 | Average Price per Ton Jan-Sep 2021 |
Special Profiles | 573 | 16,502 | 28,799 | 714 | 17,116 | 23,972 |
Commercial Profiles | 1,147 | 27,510 | 23,984 | 1,240 | 25,620 | 20,661 |
Total | 1,720 | 44,012 | 25,588 | 1,954 | 42,736 | 21,871 |
Product | Thousands of Tons Jul-Sep 2022 | Millions of Pesos Jul-Sep 2022 | Average Price per Ton Jul-Sep 2022 | Thousands of Tons Apr-Jun 2022 | Millions of Pesos Apr-Jun 2022 | Average Price per Ton Apr-Jun 2022 | Thousands of Tons Jul-Sep 2021 | Millions of Pesos Jul-Sep 2021 | Average Price per Ton Jul-Sep 2021 |
Special Profiles | 170 | 4,706 | 27,682 | 193 | 6,070 | 31,451 | 225 | 5,976 | 26,560 |
Commercial Profiles | 371 | 8,727 | 23,523 | 363 | 9,477 | 26,107 | 360 | 8,146 | 22,628 |
Total | 541 | 13,433 | 24,830 | 556 | 15,547 | 27,962 | 585 | 14,122 | 24,140 |
Any forward-looking information contained herein is inherently subject to various risks, uncertainties and assumptions which, if incorrect, may cause actual results to vary materially from those anticipated, expected or estimated. The company assumes no obligation to update any forward-looking information contained herein.
Contact: José Luis Tinajero
Mario Moreno Cortez
Grupo Simec, S.A.B. de C.V.
Calzada Lázaro Cárdenas 601
44440 Guadalajara, Jalisco, México
52 55 1165 1025
52 33 3770 6734
SOURCE Grupo Simec, S.A.B. de C.V.
