Ternium's CEO Discusses Q1 2013 Results - Earnings Call Transcript

Apr.30.13 | About: Ternium S.A. (TX)

Ternium S.A. (NYSE:TX)

Q1 2013 Earnings Call

April 30, 2013, 10:00 am ET

Executives

Sebastián Martí - Director, Investor Relations

Daniel Novegil - CEO

Pablo Brizzio - CFO

Analysts

Rodolfo De Angele - JPMorgan

Diego LaSaga - Merrill Lynch

Ivano Westin - Credit Suisse

Carlos De Alba - Morgan Stanley

Marcelo Aguiar - Goldman Sachs

Alex Hacking - Citibank

Operator

Good day ladies and gentlemen and welcome to the Ternium First Quarter 2013 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. (Operator Instructions) As a reminder this call maybe recorded.

I would now like to introduce your host for today's conference, Sebastián Martí, Investor Relations Director. You may begin.

Sebastián Martí

Good morning and thank you for joining us today. My name is Sebastián Martí and I am Ternium's Director of Investor Relations. Ternium issued a press release earlier today detailing its results for the first quarter of 2013. This call is complimentary to that presentation.

Joining me today are Ternium’s CEO, Mr. Daniel Novegil and Ternium’s CFO, Mr. Pablo Brizzio who will discuss our performance. At the conclusions of 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 in our press release issued today.

With that, I'll turn the call over to Mr. Novegil.

Daniel Novegil

Thank you, Sebastián and good morning to everyone. Well, you know that we had (inaudible) for the teleconference when reporting the 2012 early results at the end of February and at the same token we will have our Investor Day at the Guggenheim Museum in New York in around 60 days; that means on June 27th. So I will ask you, Pablo to make a brief description of our result for the first quarter of 2013 in order to go afterwards directly to the Q&A session.

Pablo Brizzio

Thanks Daniel. Good morning to everybody. Before we go into the first quarter result, I would like to comment on a change we have made this quarter in our Mining segment. The Mining segment comprises the mining activity of Las Encinas, a company in which we hold 100% equity interest and also comprises 50% of the operations and results performed by Peña Colorada, a company where we maintain a 50% equity interest. Until the end of 2012, Peña Colorada was presented as an investment in non-consolidated company. From the beginning of 2013, Ternium began to recognize Peña Colorada’s assets, liabilities, revenue and expenses in relation to its interest in the joint operation. This is a reason you will see an increase in most of the Mining segment figures in the first quarter 2013 compared to the previous quarter.

Let’s go now to our operating performance in the quarter. EBITDA during the first quarter of 2013 were $368 million; $140 million higher from the EBITDA in the fourth quarter of 2012, mainly as a result of the 73,000 tons increase in steel shipment and a $64 decrease in the steel operating cost per ton, partially offset by an $11 decrease in the steel revenue per ton.

Steel shipments were 3% higher than in the fourth quarter of 2012, an increase in all our markets. Industrial customers continue to drive our sales growth with our construction related shipments still relatively weak. As steel revenue per ton was relatively stable, a sequential reduction of just 1%, with no big changes in Mexico and slightly lower revenue per ton in the Southern Region.

Steel price in Mexico has been relatively stable during the last month, helped in part by the appreciation of the Mexican peso to the U.S. dollar, although the pricing environment in the North American has not been very strong as a result of an unbalanced supply demand situation.

The steel segment’s operation cost per ton decreased mainly as a result of lower raw material and purchased slab costs and a higher absorption of fixed costs following the restart in February of the blast furnace in Argentina.

A lowering raw material and purchased slab costs during the last couple of quarters will continue to show gradually in our cost of sales line in the next quarter as a result of first in, first out methodology of the company. The total, I said consolidated EBITDA per ton of steel increased by 56% from $105 in the fourth quarter of 2012 to $164 in the first quarter this year.

Net income in the first quarter 2013 was $151 million, equivalent to a gain of $0.66 per ADS. The results compared with $233 million net loss in the fourth quarter last year, the quarter that has been affected by $275 million loss related to Ternium investment in Usiminas.

Turning now to our financial position, at the end of the year Ternium continued improving it's already strong balance sheet with a $1.5 billion net debt position, down from $1.7 billion at the end of the fourth quarter and equivalent to approximately 1.2 times net debt to last 12 months EBITDA.

Net cash provided by operation activities in the first quarter was $348 million including an increase in working capital of $51 million. In addition, capital expenditures were $218 million lower than the $312 million that we record in the fourth quarter last year and on-track with our estimate of around $800 million of total CapEx for 2013.

I will finalize these remarks with our outlook for the first quarter of 2013. As we stated in today’s press release, steel consumption is now really recovering, however, the North American steel industry capacity utilization in the region looks moderately high related to apparent consumption; a situation that could lead to a weaker steel pricing environment.

In our region, the strongest sectors continues to be manufacturing, especially within the automotive industry while construction remains at low but improving level. Offsetting the softer pricing environment, the company anticipates a sequential reduction in steel cost per ton mainly due to lower raw material and purchased slab costs. Consequently, Ternium expects to generate operating income in the second quarter 2013 roughly inline with that of the first quarter 2013.

Well, these were the main issues I wanted to comment on, please now we can go to the Q&A session. Thanks a lot.

Question-and-Answer Session

Operator

Thank you. (Operator instructions) Our first question is from Rodolfo De Angele with JPMorgan. Your line is open. Rodolfo please check your mute button is on, speaker please pick up the handset.

Rodolfo De Angele - JPMorgan

I have a couple of questions. First, I wanted to (inaudible) with a bit more detail on what’s going in on the market especially in Mexico and also in Argentina? And my second question is on the CSA potential acquisition we spoke briefly about it the last quarter and just wonder if you have any new thing to add on that and that's it. Thank you.

Daniel Novegil

Let me start by the second part of your question, regarding the CSA project. Let me tell you that Ternium is no longer participating in the CSA process given a different value perception and also because of the industry situation. Second, going into your first part of your question the market situation in Argentina as well as in Mexico. In Argentina I would say that the market is doing well. We are performing quite well without having any problem to access to raw materials and other resources given the exchange rate situation. So the Argentine operation is for the time being is doing very well. Regarding the situation in Mexico, I would say that its following what is going on in the US market with a certain increase in consumption coming basically and especially from in the industrial sector being the construction business little bit behind in growth in both public investment as well as residential housing. So all-in-all I would say that Mexico is following what is going on in the US, and I would say that I don't expect important changes in demand in the quarter to come. The number will be a little bit lower than the one that we are looking at in March and February, but nothing relevant.

Operator

Our next question is from Diego LaSaga of Merrill Lynch.

Diego LaSaga - Merrill Lynch

I have two questions first one about your raw material costs. I understand you do have a lag between market prices that you pay for raw materials and cost of goods sold that you register in your income statement of around two quarters. So the outlook for costs in the third quarter of the year should be negative given higher iron ore prices in the first quarter of the year. Is that assessment right, could you give us some color on that? Just trying to grasp here the margin outlook for the remainder of the year. The second question is regarding the CSA or your strategy going forward. So if you are no longer looking into buying CSA, what are your options in terms of growth and in terms of maybe closing your slab gap that you have today?. So what are the options going forward?

Pablo Brizzio

Okay. Diego how are you. This is Pablo Brizzio. Let's go first to the question on cost, you are right in your analysis in respect to a slash not in all the cost structure of the company. In fact in the case of iron ore which is impacting our operation in Argentina, the lag is lower on that so you would have to see a reflection of the input cost over in the second quarter. You are right that what we are acquiring at the moment in relationship to slabs will start to reflect at the beginning of the third quarter. So in that respect, this will follow the trend as you saw in the pricing of steel product. In respect to your second question, well as Daniel mentioned, already comment on the issue of CSA, so now we will reassess for the future the options that the company has and basically achieve, but please Daniel if you have an initial comment on that, please?

Daniel Novegil

Yes, adding to your comment, Pablo, we will have the chance of getting together during our meeting in a little bit more than a month. So there we will have the chance of sitting together and discuss when to analyze and to look what are the options, what are the uncertainties, where we have a prospect in growth and strategy and so on. So maybe this is not the time of going in these numbers in detail. Regarding the first part, it's a real question, [Thiago], let me tell you or let me comment on that we have seen recently a softer pricing environment no doubt about that mainly because of the consequence of excess capacity worldwide and also because of a very high level of capacity utilization in the US market. So although lower prices obviously not good news for Ternium, we do have some advantages vis-à-vis our competitors, but turning to relatively better position for us in this kind of weak market.

The partial integration of Ternium in terms of it's last making, the fact that we bind the market around 2.5 million to 3 million tons of (inaudible) per year, give us a production flexibility now with operation and then the same token a cost advantage when buying steel in a market with over capacity like the one that we are having these days. At the same time, the very (inaudible) fully integration, integrated value adding capacity that we have in our facilities in Argentina as well as in Mexico, also helps us at time of low prices, because this high level of customization and services give us a protection so to speak and defend our margins with our customers vis-à-vis competitors.

Going back to the question on what is going on in the Argentine market on top of what I quoted related to the situation in demand and different sector so (inaudible). I would say that the automotive industry is doing very well in Argentina as well as home appliances, may be they construction a business is a little bit weaker than the one that we had a year before. At the same time, we have a very transparent company in relationship with government, directors representing the government have been participating in our Board and for the last two year we are getting a long properly and properly well with them. So in exchange rate market, no doubt that may be it is a little more bureaucratic than before, but we are not having problems to operate and the thing that we have regarding this administrative quarter and so when we have been able to overcome. So regarding dividend (inaudible) has consistently paid a yearly dividend, the last one in May 2012 was a $40 million and in the last [regression] holders meeting was approved a payment of dividend for year 2013 of $70 million.

So regarding the pricing situation, we are not having government pressures or market pressures to reduce prices. So our prices are aligned with the international market, maybe with less volatility, and so we follow the international quotation, with a not to react to changes and also as I said before less volatility.

Diego LaSaga - Merrill Lynch

Thank you Daniel, if I may just back on the CSA issue just to make it clear, you said basically out of the process because of valuation, divergence. Is that basically it or were there any issues that are preventing you from not participating in the process?

Daniel Novegil

No, as I said before, we are no longer participating in the sales process give the differentiated value perception and also because of the industry situation and that’s it.

Operator

Our next question is from Ivano Westin of Credit Suisse. Your line is open.

Ivano Westin - Credit Suisse

Just like to (inaudible) basically on your history of project the 1.5 (inaudible) if you could provide a guidance of the ramp up from the second half 2013 through 2015 it will be highly appreciated. And the second question, if you could also provide the ramp up of the volumes of Peña Colorada and Las Encinas. And on Las Encinas, if you also could comment on third purchase as you had higher cost on the back of these issues specifically this quarter. So if you could comment on this for the year that will be also highly appreciated. Thank you.

Daniel Novegil

Well, let me start with Peña Colorada project; let me tell you that we are doing well. We are in a schedule. We are in budgeting what is something that is not common nowadays in the industry, but we are really doing very well regarding budgeting and regarding product and regarding a scheduling of the process. We are planning to start operation of our galvanizing line in next August and afterwards we do have a ramp-up program in order to feel the capacity as soon as we can.

We also are working very hard to finish all the work in our [Colombian] facility, also located as you know in Pesquería, and we are making important changes that we will share with you in our Investor Day related with our marketing approach because as you know as a consequence of the growth of Ternium, as a consequence of Usiminas, as a consequence of the distribution agreement that we have with Usiminas, and as a consequence of these new facilities that we’re going to be operating in Mexico.

We are making some important changes in our marketing approach and in our commercial approach because we are starting to be a more industrial base than kind of company with a more orientation to high end products, high quality, important service requirements, important logistic requirements. So we are making some important changes in our marketing structure in order to serve this market more efficiently. So hopefully, we will have this inauguration in this coming August. We hope to do well passing all the customers and all the requirements in the automotive industry, especially there is no facility and so we have very good expectations on value coming from this investment to our company, to Ternium.

Pablo Brizzio

Okay, Ivano, let me take your second question. In fact in our mining operation, we are basically working at full capacity. We are not there in any ramp-up period. We are trying to produce in our mining operation in Mexican the most as we can. So there is no new processes or plans to increase capacity in the near future. In relationship to the structure of course of the company, it’s important to mention that we -- from this quarter on, we are consolidating the operation, the 50% of the operation of Peña Colorada. So that's why probably generating a little distortion on the numbers if you compare it to last quarter -- quarter of last year. So basically, that's the main difference. Of course pricing as you see they are reflecting the reused price that you saw from last year to this year, okay.

Operator

Our next question is from Carlos De Alba of Morgan Stanley.

Carlos De Alba - Morgan Stanley

First question is regarding your dividends. You don't go foresee a say and clearly you continue to do a good job in generating cash flows, is it possible that the company pays out a higher dividend that they want $45 million, $130 million that have been paid in the last couple of years? And the second question is, going forward, Dan is the possibility that you increase your slap capacity in Mexico or would you take another look, fresh look at the Porto do Acu in Brazil?

Pablo Brizzio

Let me take the first question regarding a dividend. As you know Ternium does not have a dividend policy with, even though that we have certainly been paying dividend every year. This year we proposed a dividend of $130 million and you know that we will have our stakeholders meeting in a couple of days. In fact, so they will -- they are the ones to decide if there is any difference and we are expecting that to happen. So we are not expecting to see any difference in our company at the moment in relationship to any transactions. So the expectation from our side is to see this dividend approved and that’s it, but now for the second part of your question, let me ask Daniel to take it.

Daniel Novegil

Yeah, talking about Carlos, talking about vertical integration, you know that we have been discussing with some of you in the past about maybe adding some capacity in Mexico through the DRI route. We're always in the process of constantly reassessing all our options. We always have the light or the market situation and perspective. So if we look our something in more detail to share with you, I will address this in the Investor Day expanding as you know our vertical integration in Mexico is always something that we have among our options and priorities. So we will continue analysing that option and to look for a cost analysis base and cost benefit base.

Talking about the project theme that is the project, the Acu project, as you know in the fourth quarter of 2012, we wrote down the PP&E, that’s means the property, plant and equipment related to the development of the Acu project and this was done mainly as a result of lack of availability of natural gas in the area as you know and we have been discussing with many of you this project was based upon the DRI route as opposed of being based upon the blast furnace route. And also we had an important iron ore (inaudible) delay an investments overruns in Anglo-American in Minas-Rio project. So we’re taking all these into consideration and putting all these ideas and this practice together, we decided to write down the property, plant and equipment that is PP&E in the fourth quarter.

In relationships with vertical integration, I will also take the opportunity of your question to comment that we are doing very well in Argentina with our investment plan. We are in the process of inaugurating (inaudible) line in August, September that will allow us to go in Argentina for a more sophisticated market, high-end products, automotive industry, home appliances and so on and so forth. Though together with the Usiminas project, together with an expansion in Pesquería and we are getting again as I mentioned before in more sophisticated profile and more industrial base.

On top of that we also are planning to put in operation our low continuous tractor in Siderar in Argentina that will add a capacity of its lab production and this line will enter into operation next March. We will be making the testing probes and everything during summertime in Argentina that means January and February and though we don't do these projects together, I think that we are addressing and we are assessing properly the issue of the vertical integration of Ternium looking forward.

Operator

Our next question is from Marcelo Aguiar of Goldman Sachs. Your line is open.

Marcelo Aguiar - Goldman Sachs

Thank you for the opportunity and then congratulation on a decision not to move forward with the CMC acquisition. Regarding your strategy, I mean some of my questions were already made, but I’d like just to understand, I mean to-date, how would you view your lab purchase strategy if Lazaro Cárdenas is not available to (inaudible) lab Mexico, how this would change your cost base, okay? Given I mean all the news that ArcelorMittal is one of the bidders for Alabama, so if you can comment in more detail, how much have the guys has been sourcing from Lazaro and if this is not available any more from read, I am not sure you guys have a very long-term contracts, how this would impact your profitability in Mexico, that is first question? I will make the second question later on.

Daniel Novegil

Well, regarding this question about (inaudible), I could say that we don't see any problems in the options on supply of a slab currently as a matter of fact we are being benefited by the market situation because of the gap between the slab pricing, that means the supply of slab at the end on our pricing at the high end and the demand side. So we see that the balance between supply-demand for our operation is now in a good moment.

I don't see any problems in the procurement of slabs, but our operation in Mexico coming from the current sources, meaning the current sources in Brazil, meaning the current sources in Argentina from the expansion of Siderar, Las Encinas also I don't see Las Encinas using the full capacity to supply other sources than different than Ternium and also we also have the ability to develop in the last year very good Russian supply, so and so you know I see that our supply base is strong now and I do not expect it to change in the short run and I guess that we will be able to continue enjoying the supply in the medium and in the short run. Second question?

Marcelo Aguiar - Goldman Sachs

Yeah, sorry, just maybe I should have been more specific on my first question, I was more referring, I mean giving and rather closer to your mill, I guess that you would have much lower logistic costs when compare if you import from Russia. So that was the focus of my question, on the first question?

Daniel Novegil

Well, the issue there is that, you know the pricing is based upon opportunity costs though, when we negotiate that with slab supply our supplier also know this sources that are competing again then. So in an event even when the logistic cost of Lázaro is better no doubt and also the speed of supply is better, the pricing is internationally based, so I don't see any important advantage not to be offset, but by this logistic factors and the speed factors. At the same time, I see Lázaro Cárdenas being a good supplier of our needs in the short run as well as in the medium run.

Unidentified Analyst

On the demand side, I mean just if you can explore a little bit more the outlook performance of these other regions that you guys are selling what are the potential in terms of growth of shipments to those regions; I mean US, Colombia and Central America given the strong performance in the first quarter? Thank you very much.

Daniel Novegil

Yeah. Let me so expand a little bit the outlook that we deliver in our press release with some very short quotations and general quotations. As you know, the steel industry capacity utilization in North America looks high, looks high relative to apparent steel consumption. The mills are running using something like 78.5%, 79% of capacity utilization and these very high level of capacity utilization vis-à-vis the market demand is putting downside barriers on pricing. The situation is leading to a weaker steel pricing environment in the region despite the fact that we have a gradual recovery in steel consumption in North America as a whole in the USA as well as in Mexico.

The strongest sectors continues to be the industrial sectors, that means in manufacturing. Especially within the automotive industry, and at the same time construction remains at low but I consider improving level with an interesting potential looking forward. But right now the construction seems to be performing weaker than industrial sector in Mexico as well as in Argentina as well as in the US. Offsetting the soft prices environment, we are expecting a reduction in steel cost per ton in the second quarter of 2013, mainly due to the fact that our lower raw material and purchased labor cost.

As a consequence of this situation as I said, we expect to generate operating income in the second quarter 2013 roughly and mainly in line with that of the first quarter. The market in Colombia and Central America even when the impact is lower in our operating income and in our commercial side, these markets are doing, probably I would say is stagnant if not weak. So, going back to the first part of your question, and talking about the US, the market is doing fairly well for the expectations. But that means there still remains a level of capacity utilization that in my view is very high, is too much high. So maybe we have to wait until the market reaches a better supply-demand balance in this region, in this part of the world.

Operator

Thank you. Our next question is from [Andrea Pinheiro of Itau BBA]. Your line is open.

Unidentified Analyst

I just have two quick questions here. I mean you were talking about fuel prices in North America, just want to get an idea, if you see China as a risk for global steel prices this year. I mean we have seen production levels pretty, if we can see further price pressure in the second half of the year? That would be my first question. And my second question actually would be, if you can give us a little update on your CapEx guidance for 2013 that would be basically it? Thank you.

Daniel Novegil

Good. Okay, let me quote your question in - well first as you the GDP growth in China in the first quarter was 7.5%, that compares against a 7.7% over the last quarter of 2012, first. Second as you said the level of production of China is quite high. We take the weekly numbers and we analyze these numbers they are running at a level of production of 767 million, 765 million tons every year that is quite high. And what the impact and consequence of this production level is an important level of exports coming out of China. The level of exports of China are around 55 million - 58 million tons on a yearly basis. But I was participating in the last forecast of World Steel Association, as you know I was assuring chairing the [ECON] committee, the Economic and Forecasting Analysis Committee of World Steel Association until last year, and so we had a chance of getting together and discussing about China and the demand in this part of the world for the rest of the year. And even when in China is slowing down little bit, there are dynamics in China that make me feel confident that China will continue to be a driver in steel consumption and in steel demand.

The organization is going very fast, the target is to reach level of the organization of 60% in the coming five years. That means that we will be expecting an important improvement in consumption of steel using goods like home appliances and cards and so on. As you know with the population of China even when the automotive industry is increasing the level of production year-by-year it’s still very low, very, very low in relationship with population and the organization rates of China. So we have to take a very professional look on what is going on in China. Many changes, growth maybe slowing down a little bit, changes from investment and infrastructure to consumption; the organization dynamics; demographic pressures, maybe a lower elasticity of the steel demand relative to GDP. As you know in the last 30 years of growth of China, the elasticity was of the steel consumption against GDP was well above 1, it was 1.5, 1.8. Now it’s below 1. That means that when China grows at 7.5% in the GDP, the steel consumption goes up at 4%, 3.5%, 5% that is lower than 1% in elasticity. So I'm optimistic that at least in the short and in the medium run China will continue to be driving the steel demand and will continue be an important demander of demand drive of steel products and steel finished goods.

Pablo Brizzio

Okay, regarding your second question we are still having the same support that's for CapEx during 2013 which is $800 million. So we are sticking to the same number that we have up to last year. $800 million in total to finish the different processes we have in place at the moment.

Daniel Novegil

Yeah we are running investment plans at the space of around $220 million to $200 million something per quarter.

Operator

(Operator Instructions) our next question is from Alex Hacking of Citibank.

Alex Hacking - Citibank

I just have one quick follow-up regarding CSA. Let's say hypothetically that the seller comes back with a more realistic lower valuation on the asset, would you see yourselves open to reengaging in this process or you think the door is completely closed now. Thanks.

Pablo Brizzio

Alex this is Pablo Brizzio; we already commented on what we think about this process. So let's stick to that and do not speculate in any additional possibilities.

Operator

Our next question is from Marcelo Aguiar of Goldman Sachs.

Marcelo Aguiar - Goldman Sachs

So just a follow-up here, just on the say -- it's more detailed question on your financials, just on the -- I mean I didn't see you guys have I think which is the impact on the Peña Colorada indeed to their line for the first quarter, just so to make an apples to apples comparison with the previous results and forecast?

Pablo Brizzio

As you see in our mining segment, the EBITDA for the quarter was $35 million. And if you compare that to the fourth of last year which was $26 million, so the difference mostly because there was a relation in average price is coming from the consolidation of Peña Colorada.

Marcelo Aguiar - Goldman Sachs

Okay. So now it’s clear. And about the price in Argentina, I know you guys commented about that, but I mean we are seeing a lot of currency depreciation you know and then much stronger current depreciation than the previous quarter. So I would just like to verify I mean how fast you guys have been able to reflect those that currency depreciation at least official rate, right you know of Argentine pesos into your prices in Argentina, I mean that would be a much different situation in terms of currency movement than we have been seen in the previous quarters.

Daniel Novegil

Okay. As you know we reiterated prices following international relationships and of course lower utility especially during this quarter we saw well widespread reaction in pricing. So the prices that you saw reducing this quarter coming from previous quarter was around $11 per ton at an average, basically was well spread around all the markets in which we were. And so we're basically having the same price situation in different markets and movement of prices in this quarters specifically we’re basically well spread around all our markets.

Marcelo Aguiar - Goldman Sachs

Okay. And then last question Daniel, just given the recent move of natural gas prices and lab prices, so how you guys are seeing the competitiveness when comparing your three routes of steel production. I mean, as lab purchase DRI Mexico in integrated in Argentina. Can you elaborate a little bit about which one is the best route right now and what's going forward, what do you think is an ideal opportunity is?

Daniel Novegil

Yeah, no doubt that our operation in Mexico using DRI is the most efficient one route that we have in the current system and I would say that maybe it's the most efficient route worldwide when we compare and benchmark in against other project. Even when the gas price went up in Italy from 2.7, 2.8 to 4.2, 4.3 nowadays, including taxes we're paying at a net price of 4.8, the (inaudible) in natural gas is still very competitive. And given the situation of shale gas in the U.S. and also the developments that we're undergoing, that the government is undergoing in Mexico we don't see important swings in the situation in the years to come. So I would say that looking forward, I see our operation in Mexico being really very competitive. In the Ternium landscape as well as in the world landscape, we compare with anybody, our cost base in the Mexican operation is very, very good.

Marcelo Aguiar - Goldman Sachs

Thank you very much.

Daniel Novegil

If we have a chance, I'd say though may be we have a chance of talking about that in rest of the day, if I prepared some numbers I would share with you.

Operator

Thank you. I am not showing any further questions in the queue, I would like to turn the call back over to management for any further remark.

Daniel Novegil

Okay. Thank you again for your interest in Ternium and for your time today. We look forward to running that we do as usual and please contact us if you have any additional questions. Thanks a lot. Bye, bye.

Operator

Ladies and gentlemen, thank you for participating in today’s conference. This concludes today’s program. You may all disconnect. Everyone have a great day.

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