The Mexican steel company Simec, with operations in Mexico, the United States and Brazil, recorded net income of MXN 1.45 billion, a figure that at today's exchange rate is equivalent to $83.7 million in the first quarter of the year, a figure that in pesos represented an increase of 40.9 percent compared to the same period last year, according to the company's financial statement.
Simec reported that its sales plummeted 38.5 percent to the equivalent of $453 million (considering an exchange rate of MXN 17.4 pesos per dollar). Despite the lower billing, its selling and administrative expenses increased 1.4 percent to the equivalent of $34 million.
EBITDA decreased by 43.6 percent to $96 million. However, net income increased by 40.9 percent to $83.7 million. According to the financial statements, seen by SteelOrbis, these gains resulted from lower exchange losses.
In the first quarter of the year, exchange losses went from the equivalent of $75.0 million in the first quarter of last year to $5.9 million in the first three months of the current year. Additionally, there was a 79.3 percent reduction in income taxes totaling only $6.3 million. This explains the increase in net income in a period of plummeting sales.
According to the company, in the first quarter its sales volume decreased by 20.7 percent or 125,000 mt, totaling the period at 479,000 mt.
Of the total, commercial profiles totaled 352,000 mt and special steels 127,000 mt, figures that represented annual decreases of 17.2 and 29.1 percent respectively compared to the volume sold in the first quarter of last year.