Ternium's Q2 2025: Contradictions Unveiled on Margins, Market Share, and Dividend Strategy

Improved EBITDA and Cost Reduction Initiatives:
- Ternium reported a 25% increase in adjusted EBITDA in Q2 2025, driven by stronger realized steel prices in Mexico.
- The growth was mainly attributed to cost efficiency measures and operational improvements, with plans to decrease costs by $300 million annually.

Market Dynamics and Trade Policies:
- Ternium anticipates a slightly increase in shipments in Q3, primarily led by Mexico, with support from Argentina and stable volumes in Brazil.
- This outlook is influenced by trade measures taken by Mexico to defend against unfair trade practices, particularly from Asian countries.

Investment in Expansion and Sustainability:
- Ternium is investing $4 billion in expansion projects, with the Pesqueria project in Mexico nearing completion and expected to start ramping up production in December.
- The company is also prioritizing sustainability, releasing a report detailing its efforts to advance environmental performance and social responsibility.

Capital Expenditure and Financial Strategy:
- Ternium's CapEx for Q2 2025 was $800 million, with the peak expected in the second quarter, followed by a decrease to around $700 million per quarter for the remainder of the year.
- The company plans to maintain its dividend payments despite challenges, focusing on sustaining its capital expenditure plan and improving margins.