Ternium SA
NYSE:TX
Ternium SA
Nestled within the realm of the steel industry, Ternium S.A. stands as a prominent player, intricately weaving together operations that stretch from ore extraction to the delivery of finished steel products. Founded in 1969 as part of the Techint Group, the company has since grown into a towering presence across Latin America. Ternium prides itself on a vertically integrated business model, starting with the mining of iron ore which serves as a vital ingredient in the steel production process. This integration ensures a steady supply chain and cost efficiency, setting the foundation for the company’s robust financial performance. With steel manufacturing plants scattered across Mexico, Argentina, and Brazil, Ternium specializes in producing a diverse array of value-added steel products. These range from hot-rolled, cold-rolled, and galvanized steel sheets intended for industries such as construction, automotive, manufacturing, and home appliances.
Ternium's operations extend beyond mere production as they skillfully navigate the complex web of distribution to maximize profitability. The company has built a solid reputation on its innovative capabilities, focusing on developing advanced steel grades and solutions tailored to meet the evolving needs of its customer base. Through strategic investments in technology and capacity expansion, Ternium enhances its competitive edge, ensuring its ability to fulfill large-scale demands efficiently. A critical facet of its strategy involves collaborations and long-standing relationships with clients, enabling the company to better forecast demand trends and fine-tune its production accordingly. Ternium's approach to business reflects a careful blend of operational excellence, strategic foresight, and a commitment to sustainability, creating a resilient framework for continued growth in the ever-dynamic steel sector.
Nestled within the realm of the steel industry, Ternium S.A. stands as a prominent player, intricately weaving together operations that stretch from ore extraction to the delivery of finished steel products. Founded in 1969 as part of the Techint Group, the company has since grown into a towering presence across Latin America. Ternium prides itself on a vertically integrated business model, starting with the mining of iron ore which serves as a vital ingredient in the steel production process. This integration ensures a steady supply chain and cost efficiency, setting the foundation for the company’s robust financial performance. With steel manufacturing plants scattered across Mexico, Argentina, and Brazil, Ternium specializes in producing a diverse array of value-added steel products. These range from hot-rolled, cold-rolled, and galvanized steel sheets intended for industries such as construction, automotive, manufacturing, and home appliances.
Ternium's operations extend beyond mere production as they skillfully navigate the complex web of distribution to maximize profitability. The company has built a solid reputation on its innovative capabilities, focusing on developing advanced steel grades and solutions tailored to meet the evolving needs of its customer base. Through strategic investments in technology and capacity expansion, Ternium enhances its competitive edge, ensuring its ability to fulfill large-scale demands efficiently. A critical facet of its strategy involves collaborations and long-standing relationships with clients, enabling the company to better forecast demand trends and fine-tune its production accordingly. Ternium's approach to business reflects a careful blend of operational excellence, strategic foresight, and a commitment to sustainability, creating a resilient framework for continued growth in the ever-dynamic steel sector.
Cost Savings: Ternium delivered $250 million in cost reductions for 2025, supporting profitability amid challenging steel markets.
EBITDA Margin: EBITDA margin reached 10%, with management aiming to increase margins further and potentially return to a 15% range by the end of 2026.
Profitability Outlook: Management expects profitability to improve in 2026, driven by higher margins and shipment growth, especially in Mexico.
CapEx & Growth: CapEx peaked in 2025 at $2.3 billion cash from operations; expected to decrease to $2 billion in 2026 and $1.2 billion in 2027.
Dividends: The Board proposed an annual dividend of $2.70 per ADS for 2025, unchanged from the prior year, implying a yield over 6%.
Market Environment: Trade protectionism and antidumping measures in Mexico and Brazil are creating a more favorable competitive landscape, with gradual expected price benefits.
Strategic Projects: New cold rolling and galvanized lines are ramping up in Pesqueria; construction of a new slab plant remains on track to start up by year-end.
Volume Guidance: Shipments are expected to grow in 2026, particularly in Mexico due to market share gains and new capacity.
