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Grupo Simec Announces Results of Operations for the First Quarter, of 2013, Ended March 31, 2013

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GUADALAJARA, Mexico, April 25, 2013 /PRNewswire/ -- Grupo Simec, S.A.B. de C.V. (NYSE: SIM) ("Simec") announced today its results of operations for the three-month period ended March 31, 2013.

Comparative first quarter of 2013 vs. first quarter of 2012

Net Sales

Net sales of the company decreased 21% by the combination of: decrease in volume shipped and the sales price. Sales drop from Ps. 8,115 million in the first quarter of 2012 to Ps. 6,443 million in the same period of 2013. Shipments of finished steel products decreased 10%, from 588 thousand tons in the first quarter of 2012 compared to 531 thousand tons in the same period of 2013. Total sales outside of Mexico in the first quarter of 2013 decreased 28% to Ps. 3,070 million compared to Ps. 4,288 million in the same period of 2012. The Mexican sales decreased 12% from Ps. 3,827 million in the first quarter of 2012 to Ps. 3,373 million in the same period of 2013. The decrease in sales can be explained due to the volume of tons shipments compared with the same period of 2012 the products shipments decrease in 57 thousand tons versus the same period of 2013. The average sales price decrease 12% in the first quarter of 2013 compared with the same period of 2012.

Cost of Sales

Cost of sales decreased 18% from Ps. 6,960 million in the first quarter of 2012 to Ps. 5,722 million in the same period of 2013. Cost of sales as a percentage of net sales in the first quarter of 2013 represented 89% and in 2012 cost of sales represented 86%. The average cost of finished steel products in the first quarter of 2013 decreased 9% compared to the same period of 2012.

Gross Profit

Gross profit of the company for the same period decreased 38% from Ps. 1,155 million in 2012 to Ps. 721 million in the same period of 2013. Gross profit as a percentage of net sales in the first quarter of 2013 was 11% and for the same period of 2012 was 14%. The decrease in gross profit is due to the reduced volume of shipments in the first quarter of 2013 compared with the same period of 2012.

General, Sales and administrative Expenses

General, selling and administrative expenses increased 5% from Ps. 316 million in the first quarter of 2012 compared to Ps. 332 million in the same period of 2013, and representing 5% and 4% of net sales in the first quarter of 2013 and 2012 respectively.

Other Expenses (Income) net

The company recorded other expense net of Ps. 2 million in the first quarter of 2013 compared to other income net of Ps. 10 million in the same period of 2012.

Operating Income

Operating income decreased 54% from Ps. 849 million for the first quarter of 2012 compared to Ps. 387 million in the same period of 2013. Operating income as a percentage of net sales was 6% in the first quarter of 2013 compared to 10% in the same period of 2012. The decrease in operating income is due to decrease in volume of shipments and the average sales price, in the first quarter of 2013 compared with the same period of 2012.

EBITDA

The EBITDA of the company for the first quarter of 2013, show a decrement of 38%, by the above mentioned to pass from Ps. 1,097 million in the first quarter of 2012 compared against Ps. 679 million of the first quarter of 2013.

Comprehensive Financial Cost 

Comprehensive financial cost in the first quarter of 2013 represented a net expense of Ps. 218 million compared with an expense of Ps. 147 million in the same period of 2012. Net interest was an expense of Ps. 0 million in the first quarter of 2013 compared with a net expense of Ps. 1 million in the same period of 2012. At the same time, Simec registered an exchange loss of Ps. 218 million in the first quarter of 2013 compared with an exchange loss of Ps. 146 million in the same period of 2012.

Income Taxes

Income Taxes recorded an income of Ps. 18 million in the first quarter of 2013 (including the income of Ps. 27 million of deferred income taxes) compared to an income of Ps. 30 million in the same period of 2012 (including the benefits of Ps. 32 million of deferred income taxes).

Net Income (loss) (Before Non- controlling Interest)

As a result of the foregoing, net income decreased 58% to Ps. 306 million in the first quarter of 2013 from Ps. 729 million in the same period of previous year.

Liquidity and Capital Resources

As of March 31, 2013, Simec's total consolidated debt consisted of U.S. $302,000 of 8 7/8% medium-term notes ("MTN's") due 1998, or Ps. 3.7 million (accrued interest on March 31, 2012 was U.S. $506,856, or Ps. 6.3 million).  As of March 31, 2012, Simec's total consolidated debt consisted of U.S. $302,000 of 8 7/8% medium-term notes ("MTN's") due 1998, or Ps. 3.9 million (accrued interest on March 31, 2012 was U.S. $479,730 or Ps. 6.2 million).

Comparative first quarter of 2013 vs. fourth quarter of 2012

Net Sales

Net sales of the company increased 6% from Ps. 6,106 million of the fourth quarter of 2012 to Ps. 6,443 million to the first quarter of 2013. Sales in tons of finished steel increased 2% from 520 thousand tons in the fourth quarter of 2012 compared with 531 thousand tons in the first quarter of 2013. The total sales outside of Mexico for the first quarter of 2013 increased 42 % to Ps. 2,166 million in the fourth quarter of 2012, compared with Ps. 3,070 million for the first quarter of 2013. The Mexican sales decreased 14% from Ps. 3,940 million in the fourth quarter of 2012 to Ps. 3,373 million in the first quarter of 2013.  Average prices of finished products sold in the first quarter of 2013 increased 3% compared to the fourth quarter 2012.

Cost of Sales

Cost of sales decreased 5% from Ps. 6,007 million in the fourth quarter of 2012 to Ps. 5,722 million in the first quarter of 2013. With respect to sales, in the first quarter of 2013, the cost of sales represented 89% compared to 98% for the fourth quarter of 2012. The average cost of sales per ton of finish goods decrease 7% in the first quarter of 2013 versus the fourth quarter of 2012 as a result of an increased volume of shipments on the first quarter of 2013.

Marginal (Loss) Profit

Marginal profit for the first quarter of 2013 amounted to Ps. 721 million compared with the profit of Ps. 99 million in the fourth quarter of 2012. The marginal profit as a percentage of net sales for the first quarter of 2013 was 11% compared with 2% for the fourth quarter of 2012. The increase in marginal profit is due to the increase in the volume of the shipments and the average sales price comparing the first quarter of 2013 versus the fourth quarter of 2012.

General, Sales and administrative Expenses

General, selling and administrative expenses amounted to Ps. 332 million in the first quarter of 2013 versus Ps. 362 million in the fourth quarter of 2012, equivalent to a decrement of 8%. General, selling and administrative expenses as a percentage of net sales represented 5% during the first quarter of 2013 and 6% for the fourth quarter of 2012.

Other Expenses (Income) net

The company recorded other expenses net of Ps. 2 million in the first quarter of 2013 compared with other income net of Ps. 187 million for the fourth quarter of 2012.

Operating (Loss) Income

Operating income was of Ps. 387 million in the first quarter of 2013 compared to a loss of Ps. 76 million of the fourth quarter of 2012. The operating income amount an increase of 609% between both quarters. The operating income as a percentage of net sales in the first quarter of 2013 was 6% compared to minus 1% in the fourth quarter of 2012. The increase in operating income is due to the improved in volume of shipments, an increase in the average sales price and  a diminish in the general, selling and administrative expense for the first quarter of 2013 compared with the fourth quarter of 2012.

EBITDA

The EBITDA of the first quarter of 2013 was of Ps. 679 million compared to Ps. 200 million of the fourth quarter of 2012, an increase of Ps 479 million.

Comprehensive Financial Cost

Comprehensive financial cost for the first quarter of 2013 represented an expense of Ps. 218 million compared with an income of Ps. 295 million for the fourth quarter of 2012. Net interest for the first quarter of 2013 and the fourth quarter of 2012 amounted an expense of Ps. 0 million. At the same time we registered an exchange net loss of Ps. 218 million in the first quarter of 2013 compared with an exchange net loss of Ps. 295 million in the fourth quarter of 2012.

Income Taxes

The Company record an income tax, as income of Ps. 18 million in the first quarter of 2013 (including the income of Ps. 27 million of deferred income taxes) compared to an expense of Ps. 89 million in the fourth quarter same period of 2012 (including the expense of Ps. 105 million of deferred income taxes).

Net Income (loss) (Before Non- controlling Interest)

As a result of the foregoing, net income was of Ps. 306 million in the first quarter of 2013 versus net loss of Ps. 283 million in the fourth quarter of 2012

 

Quarter






(million of pesos)

1Q'13

4Q '12

1Q '12

1Q´13vs
4Q´12

1Q´13 vs
1Q '11

Sales

6,443

8,115

6,106

(21%)

6%

Cost of Sales

5,722

6,960

6,007

(18%)

(5%)

Gross Profit

721

1,155

99

(38%)

628%

Selling, General and Adm. Expenses

332

316

362

5%

(8%)

Other Income (Expenses), net

(2)

10

187

(120%)

(101%)

Operating Profit

387

849

(76)

(54%)

609%

EBITDA

679

1,097

200

(38%)

240%

Net Income

306

729

(283)

(58%)

208%

Sales Outside Mexico

3,070

4,288

2,166

(28%)

42%

Sales in Mexico

3,373

3,827

3,940

(12%)

(14%)

Total Sales (Tons)

531

588

520

(10%)

2%

 

Product

Thousand of Tons

Jan-Mar 2013

Million of Pesos  
Jan-Mar 2013

Average Price per Ton

Jan-Mar 2013

Thousand of Tons

Oct-Dec

2012

Million of Pesos
 Oct-Dec

2012

Average Price per Ton

Oct-Dec

2012

Thousand of Tons Jan-Mar

2012

Million of Pesos Jan-Mar  2012

Average Price per Ton 
Jan-Mar

2012

Commercial Profiles

247

2,475

10,021

254

2,947

11,602

 

302

2,850

9,437

Special Profiles

284

3,968

13,971

334

5,168

15,473

 

218

3,256

14,936































Total

531

6,443

12,134

588

8,115

13,801

520

6,106

11,742











 

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:
Mario Moreno Cortez
Grupo Simec, S.A.B. de C.V.
Calzada Lazaro Cardenas 601
44440 Guadalajara, Jalisco, Mexico
+52 33 3770 6734
mmoreno@gruposimec.com.mx

SOURCE Grupo Simec, S.A.B. de C.V.



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