Ternium S.A.

Thank you for standing by. My name is Jordan and I'll be your conference operator today. At this time, I'd like to welcome everyone to Turnium fourth quarter 2025 results call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during this time, simply press star, followed by the number one on your telephone keypad. If you'd like to withdraw your question, press star one again. Thank you. I'd now like to turn the call over to Sebastian Marty. Please go ahead.

Good morning. Thank you for joining us. My name is Sebastian Mari and I am TURNING's Global IR and Compliance Senior Director. This morning, we released our results for the fourth quarter and full year 2025. Today's call is intended to add context to that presentation. Joining me today are Maximo Bedoya, our Chief Executive Officer, and Pablo Brizio, the company's Chief Financial Officer, who will review TURNING's operating environment and performance. Following our prepared remarks, we will open up the floor 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 on page two in today's webcast presentation. You will also find any references to non-IFRS financial measures reconciled to the most directly comparable IFRS measures in the press release issued today. With that, I'll turn the call over to Mr. Bedoya.

Thank you, Sebastián, and good morning, everyone. We appreciate you being here today in our conference call. Cadmium delivered resilient results in 2025, overcoming challenging market conditions by adapting rapidly and acting proactively to protect profitability. The company's cost reduction and efficiency program generated $250 million dollars in savings in 2025 over 2024. Key initiatives included enhancing blast furnace stability, negotiating service contracts, optimizing iron ore sourcing, and improving logistics. As a result, our EBITDA margin reached 10%. Our performance, however, was affected by a fatal accident at Ternio, Mexico in 2025, and another attorney in Brazil during this quarter. Usiminas also experienced a fatality in 2025. We take safety extremely seriously and consider this event a significant setback. Such outcomes are unacceptable, prompting us to reinforce our safety programs. In response, we are ramping up preventive actions with a special focus on critical risk. Let me now review the latest changes in the global trade environment. The United States took significant trade measures in 2025 to counter unfair trade practices from China and other Asian countries. And this is reshaping the global field market, as other countries around the world are following a similar path. In Mexico, the government recently raised import tariffs on more than 1,400 tariff lines for countries without a free trade agreement. In the case of steel, import tariffs increased from 25 to 35%. Meanwhile, negotiations around the North American region trade framework are ongoing. Many stakeholders from both sides of the border continue to engage in discussions. We are taking an active role in sharing the concerns and priorities of the manufacturing industry throughout this process. I see broad support for public policies that promote greater regional integrations. The aim is to keep trade fair, address imbalance, avoid transshipment, and reinforce rule of origins. It is important to mention that an agreement to intensify trade flows should avoid restrictions on intra-regional trade, like those based on Section 232. At the USMCA, joint review take place Removing restrictions to trade among its members will be essential to ensuring the benefit of deeper integration. Ternium is also doing its part in this process of greater regional integrations. Since our arrival in Mexico over 20 years ago, we have significantly expanded our footprint in the country, investing in state-of-the-art technology to offer a wider range of high-value added products to our customers in the region's manufacturing industry. in this line, I am pleased to share some exciting news. We have started production in our new cold rolling mill and also in our galvanized line at the Pesqueria facility. This achievement completes our downstream expansion at the site, made possible by outstanding teamwork. The entire project also added a picking line and a finishing line center. All these facilities are now operational, with the coal drilling and the galvanized lines starting the ramp-up phase. Meanwhile, construction of the slab plant is moving ahead as planned, as we expect to start up the facility by the end of the year. This new plant will allow us to produce high-quality autumn steel with lower CO2 emissions per ton in the industry. Adding a touch of color, in 2025, we secure a $1.25 billion loan through a green financing facility to support this project. The loan received several awards last quarter, including IFR's Sustainable Loan of the Year, GBM Awards Sustainable Loan Deal of the Year in Latin America and Caribbean, and an honorable mention from Latin Finance. Turning to Brazil, the recent implementation of anti-dumping measures and the increase in import taxes of nine steel products represent a significant shift in the market environment. These decisive actions signal a stronger government commitment to support local producers and achieve a balanced competitive landscape. Looking ahead, it will be key to monitor the market closely to prevent attempts to circumvent these measures, ensuring that this new environment continues to support fair competition. In Argentina, growing concerns have emerged regarding unfair trade practice from China. In this situation, the new trade agreement between Argentina and the United States is important because both countries have agreed to work together to address unfair trade practices from other nations. While we believe Argentina should further integrate with the global economy, it is crucial to approach this process with cautions, particularly in view of China's excess production capacity and predatory trade tactics. I'm optimistic about Tarnium's outlook for the coming years. I expect Tarnium's profitability to improve in 2026, starting from the first quarter. On one hand, We will continue working on reducing costs and enhancing operational efficiency. On the other, although there are still several important trade issues to be worked out, I am encouraged by the growing support of market economy governments around the world for addressing unfair trade practices. A discussion between the United States and Mexico advance, I'm confident that a mutually beneficial agreement will be reached as A world structure agreement is good for all parties involved. Mexico has demonstrated its commitment to reinforce regional defenses against unfair trade practices and encouraging investment within the region, aligning strategy with that of the United States in ongoing negotiations. In addition, promising changes in Brazil's steel market environment and advancing economic reform in Argentina give us hope for the future in South America. In this context, we have reached an important milestone in the largest industrial expansion in our company's history. Together, these developments will put us in a unique positions as they will help create a stronger foundation for growth across the region. Thank you all for your attention. And before I handing over to Pablo, Let me thank especially our colleagues in Brazil, all the analysts there who made it to join us during the Carnival season. So I hope you have a very good holiday. So Pablo, please go ahead.