Grupo Simec SAB de CV has announced its results of operations for the nine month period ended September 30th 2012.

Net Sales
Net sales of the company increased 9% from MXN 21,434 million in the first nine months of 2011 to MXN 23,418 million in the first nine months of 2012. Shipments of finished steel products increased 1% from 1,731,000 tonnes in the first nine months of 2011 to 1,742,000 tonnes in the first nine months of 2012. Total sales outside of Mexico in the first nine months of 2012 decreased 1% to MXN 11,608 million compared to MXN 11,696 million in the first nine months of 2011.

Mexican sales increased 21% from MXN 9,738 million in the first nine months of 2011 to MXN 11,810 million in the first nine months of 2012. The increase in sales for the first nine months of 2012 compared to the first nine months of 2011, is due to the combined of better average sales price of 9% and increase in the volume of shipments approximately of 11,000 tonnes that represent a 1%.

Cost of Sales
Cost of sales increased 5% from MXN 18,935 million in the first nine months of 2011 to MXN 19,954 million in the first nine months of 2012. Cost of sales as a percentage of net sales represented 85% in the first nine months of 2012 while in the first nine months of 2011 represented 88%. Cost of sales increase approximately 5% in the first nine months of 2012 compared to the first nine months of 2011, due to the major volume shipment and increase in certain raw materials.

Gross Profit
Gross profit of the Company for the first nine months of 2012 increased 39% from MXN 2,499 million in the first nine months of 2011 to MXN 3,464 million in the first nine months of 2012. Marginal profit as percentage of net sales in the first nine months of 2012 was of 15% while in the first nine months of 2011 was of 12%. The gross profit between both periods is due for better in the average sales price and major volume of shipments between both periods.

General, Selling and Administrative Expense
Selling, general and administrative expense increase 25%, from MXN 694 million in the first nine months of 2011 to MXN 866 million in the same period 2012, selling, general and administrative expense represented 4% of the net sales of the first nine months of 2012 and 3% of net sales in the first nine months of 2011.

Other Income (Expenses,) net
The company recorded other expense net for MXN 5 million during the first nine months of 2012 while in the same period of 2011 the other income net by this concept was of MXN 22 million.

Operating Income
Operating income increased 42% from MXN 1,827 million for the first nine months of 2011 as compared to MXN 2,593 million in the first nine months of 2012. Operating income as percentage of net sales was 11% in the first nine months of 2012 as compared to 9% in the same period of 2011. The increase in operating income is due to an increase in revenues and increase in volume of finish good shipments.

EBITDA
The EBITDA of the first nine months of 2012, increase in MXN 679 million or 26% compared to first nine months of 2011, due to a better in the average sales price and to a major volume shipments. The EBITDA passed of MXN 2,650 million of the first nine months of 2011 to MXN 3,329 million in the first nine months of 2012.

Source - Grupo Simec

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