Ternium 2Q 2020

Ternium Argentina showed a negative semi-annual net result, due to decreases in volumes sold and negative results of investments in associated companies. However, it managed to finish the second quarter with a balanced result despite the significant drop in activity caused by the COVID-19 pandemic.

Ternium Argentina's consolidated net sales fell 15,5% y-o-y in 1H 2020, as did operating income which decreased 7,4%. This was accompanied by a decrease in the result of investments in associated companies and lower financial results. Thus, the consolidated net result was - $641,1 million.

In 2Q 2020, sales fell 20% mainly due to the low level of domestic shipments in the context of the COVID-19 pandemic, and the operating result became negative. However, thanks to a better result of investments in associated companies, the net result for the quarter was a loss of only $0,8 million.

In 3Q 2020, domestic shipments could increase taking into account a slow recovery of the local market, in the construction, agricultural, packaging, and household items sectors. Exports could remain stable.

Given this context, the target price may remain relatively stable or show a slight rise.