GRUPO SIMEC, S.A.B. DE C.V. GUADALAJARA, Mexico, April 27, 2017 /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, 2017.
Comparative first quarter of 2017 vs. first quarter of 2016
Net Sales
The net sales of the company increased 30% derived from the increase in shipments of steel. Sales increased from Ps. 6,102 million in the first quarter of 2016 to Ps. 7,922 million in the same period of 2017. Shipments of steel finished goods increased 7% from 528 thousand tons in the first quarter of 2016 compared to 563 thousand tons in the same period of 2017. Total sales outside of Mexico in the first quarter of 2017 increased 54% to reach Ps. 3,703 million compared to Ps. 2,411 million in the same period of 2016. The Mexican sales in 14% from Ps. 3,691 million in the first quarter of 2016 to Ps. 4,220 million in the same period of 2017. The increase in sales can be explained due to a greater volume shipped in 7% compared with the same period of 2016. The average sales price per ton of steel finished goods increase 22% in the first quarter of 2017 compared with the same period of 2016.
Cost of Sales
The cost of sales increased 23% from Ps. 5,158 million in the first quarter of 2016 to Ps. 6,348 million in the same period of 2017. In the first quarter of 2017 the cost of sales represents the 80% of the net sales compared to 85% in the same period of 2016. The average cost of sales per ton of steel finished goods increased 15% in the first quarter of 2017 compared to the same period of 2016.
Gross Profit
The gross profit of the company for the same period increased 67% from Ps. 944 million in 2016 to Ps. 1,574 million in the same period of 2017. Gross profit as a percentage of net sales in the first quarter of 2017 was 20% and for the same period of 2016 was 15%. The increase in gross profit is due to a greater volume shipped, better average cost and a competitive cost of the raw materials in the first quarter of 2017 compared with the same period of 2016.
General, Sales and administrative Expenses
General, selling and administrative expenses increased 15%, from Ps. 338 million in the first quarter of 2016 to Ps. 388 million in the same period of 2017, and representing 5% of net sales in the first quarter of 2017 and 6% to the same period of 2016.
Other Expenses (Income) net
The company recorded other income net of Ps. 1 million in the first quarter of 2017 compared to other expenses net of Ps. 3 million in the same period of 2016.
Operating Income
The operating income increased from Ps. 603 million for the first quarter of 2016 compared to Ps. 1,187 million in the same period of 2017. Operating income as a percentage of net sales was 15% in the first quarter of 2017 compared to 10% in the same period of 2016. The increase in operating income is due to a greater volume shipped, better price of sales and a competitive cost of sales in the first quarter of 2017 compared with the same period of 2016.
EBITDA
The EBITDA of the Company for the first quarter of 2017, show an increase of 79%, by the above mentioned to pass from Ps. 883 million in the first quarter of 2016 compared against Ps. 1,583 million of the first quarter of 2017.
Comprehensive Financial Cost
The Comprehensive financial cost in the first quarter of 2017 represented a net expenses of Ps. 531 million compared with an income of Ps.269 million in the same period of 2016. Net interest was an expense of Ps. 2 million in the first quarter of 2017 compared with a net income of Ps. 1 million in the same period of 2016. At the same time, Simec registered an exchange loss of Ps. 529 million in the first quarter of 2017 compared with an exchange income of Ps. 268 million in the same period of 2016.
Income Taxes
Income Taxes recorded an income of Ps.64 million in the first quarter of 2017 (including the income of Ps. 70 million of deferred income taxes) compared to an expense of Ps. 17 million in the same period of 2016 (including the benefits of Ps. 25 million of deferred income taxes).
Net Income (loss) (Before Non- controlling Interest)
As a result of the foregoing, net income decreased 34% to Ps. 681 million in the first quarter of 2017 from Ps. 1,032 million in the same period of previous year.
Financial Situation, Liquidity and Capital Resources
As of March 31, 2017, Simec's total consolidated debt consisted of U.S. $302,000 of 8 7/8% medium-term notes ("MTN's") due 1998, or Ps. 5.6 million (accrued interest on March 31, 2017 was U.S. $650.6, or Ps. 12.2 million). As of March 31, 2016, Simec's total consolidated debt consisted of U.S. $302,000 of 8 7/8% medium-term notes ("MTN's") due 1998, or Ps. 5.2 million (accrued interest on March 31, 2016 was U.S. $621.70 or Ps. 10.7 million).
Comparative first quarter of 2017 vs. fourth quarter of 2016
Net Sales
The net sales of the company increased 29% comparing Ps. 6,128 million in the fourth quarter of 2016 to Ps. 7,922 million in the first quarter of 2017. The tons sales increased 30%, from 434 thousand tons in the fourth quarter of 2016 compared to 563 thousand tons in the first quarter of 2017. Total sales outside of Mexico in the first quarter of 2017 increased 96% from Ps. 1,890 million on the last quarter of 2016 compared to Ps. 3,703 million in the first quarter of 2017. The Mexican sales remained from Ps. 4,238 million in the fourth quarter of 2016 to Ps. 4,219 million in the first quarter of 2017. The increase mainly due to a greater volume shipped, better average sales price per ton price of sales in the first quarter of 2017 compared with the same period of 2016.
Cost of Sales
Cost of sales increased 24% from Ps. 5,108 million in the fourth quarter of 2016 to Ps. 6,348 million in the first quarter of 2017. Cost of sales as a percentage of net sales in the first quarter of 2017 represented 80% and in the last quarter of 2016 cost of sales represented 83%. The average cost of finished steel products in the first quarter of 2017 decreased 4% compared to the fourth quarter of 2016 as a result of an increased on the shipped volume and better cost of raw materials.
Gross Profit
Gross profit of the company for the first quarter increased to Ps. 1,574 million in 2017 from Ps. 1,020 million in the last quarter of 2016. Gross profit as a percentage of net sales in the first quarter of 2017 was 20% and for the last period of 2016 was 17%. The increase in gross profit is due to the rise on the production and volume of shipments and better cost of raw materials on the first quarter of 2017 compared with the last quarter of 2016.
General, Sales and administrative Expenses
General, selling and administrative expenses increased 13% to Ps. 388 million in the first quarter of 2017 compared to Ps. 344 million in the fourth quarter of 2016, representing 5% of net sales in the first quarter of 2017 and for the last period of 2016 was 6%.
Other Expenses (Income) net
The company recorded other net expenses of Ps. 1 million in the first quarter of 2017 compared to other net expenses of Ps. 189 million in the fourth quarter of 2016.
Operating Income
Operating income increased 144% to Ps. 1,187 million for the first quarter of 2017 compared to Ps. 487 million in the last quarter of 2016. Operating income as a percentage of net sales was 15% in the first quarter of 2017, compared to 8% in the last quarter of 2016. The increase in operating income is due to the increase in production and volume of shipments, in the first quarter of 2017 compared with the fourth quarter of 2016.
EBITDA
The EBITDA of the company for the first quarter of 2017 was Ps. 1,583 million compared against Ps. 1,015 million of the last quarter of 2016, an increase of Ps. 568 million.
Comprehensive Financial Cost
Comprehensive financial cost in the first quarter of 2017 represented a net expense of Ps. 531 million compared with an income of Ps. 692 million in the fourth quarter of 2016. Net interest income of the first quarter of 2017 was of Ps. 2 million compared with an interest net income of Ps. 16 million in the last quarter of 2016. At the same time, Simec registered on exchange loss of Ps. 529 million in the first quarter of 2017 compared with an income on exchange rate of Ps. 676 million on the last quarter of 2016.
Income Taxes
Income Taxes recorded an income of Ps. 64 million in the first quarter of 2017 (including Ps. 70 million of deferred income taxes) compared with an expense of Ps. 15 million in the same period of 2016 (including the benefits of Ps. 7 million of deferred income taxes).
Net Income (loss) (Before Non- controlling Interest)
As a result of the foregoing, the net income of the first quarter of 2017 is of Ps. 681 million compared with Ps. 306 million of the last period of previous year.
Quarter
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(millions of pesos) 1Q'17 1Q '16 4Q '16 1Q´17 vs 1Q´17 vs
1Q´16 4Q '16
--- ----- ------
Sales 7,922 6,102 6,128 30% 29%
----- ----- ----- ----- --- ---
Cost of Sales 6,348 5,158 5,108 23% 24%
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Gross Profit 1,574 944 1,020 67% 54%
------------ ----- --- ----- --- ---
Selling, General and Adm. Expenses 388 338 344 15% 13%
---------------------------------- --- --- --- --- ---
Other Income (Expenses), net 1 (3) (189) (133%) (101%)
---------------------------- --- --- ---- ----- -----
Operating Profit 1,187 603 487 97% 144%
---------------- ----- --- --- --- ---
EBITDA 1,583 883 1,015 79% 56%
------ ----- --- ----- --- ---
Net Income 681 1,032 306 (34%) 123%
---------- --- ----- --- ---- ---
Sales Outside Mexico 3,703 2,411 1,890 54% 96%
-------------------- ----- ----- ----- --- ---
Sales in Mexico 4,219 3,691 4,238 14% 0%
--------------- ----- ----- ----- --- ---
Total Sales (Tons) 563 528 434 7% 30%
----------------- --- --- --- --- ---
Cost per Ton 11,275 9,769 11,770 15% (4%)
------------ ------ ----- ------ --- ---
Product Thousands of Tons Million of Pesos Jan- Average Price per Ton Thousands of Tons Million of Pesos Oct- Average Price per Ton Thousands of Tons Jan-Mar Million of Pesos Jan- Average Price per Ton Jan-
Mar 2017 Dec Mar 2016 Mar 2016
Jan-Mar 2017 Jan-Mar Oct-Dec 2016 Oct-Dec 2016
2017 2016 2016
--- ---- ---- ----
Commercial Profiles 335 3,875 11,567 280 2,629 9,389 247 3,112 12,599
------------------- --- ----- ------ --- ----- ----- --- ----- ------
Special Profiles 228 4,047 17,750 248 3,473 14,004 187 3,016 16,128
---------------- --- ----- ------ --- ----- ------ --- ----- ------
Total 563 7,922 14,071 528 6,102 11,557 434 6,128 14,120
----- --- ----- ------ --- ----- ------ --- ----- ------
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.
PRESS RELEASE Contact: Sergio Vigil González
Mario Moreno Cortez
Grupo Simec, S.A.B. de C.V.
Calzada Lázaro Cárdenas 601
44440 Guadalajara, Jalisco,
México
52 55 1165 1025
52 33 3770 6734
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SOURCE Grupo Simec, S.A.B. de C.V.
