UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER 1-11176
For the month of July , 2009.
--------------------------------------------------------
Group Simec, Inc.
--------------------------------------------------------------------------------
(Translation of Registrant's Name Into English)
Av. Lazaro Cardenas 601, Colonia la Nogalera, Guadalajara, Jalisco, Mexico 44440
--------------------------------------------------------------------------------
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F.
Form 20-F |X| Form 40-F |_|
Indicate by check mark whether the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(1)
Yes |_| No |X|
Indicate by check mark whether the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(7)
Yes |_| No |X|
Indicate by check mark whether the registrant by furnishing the information
contained in this form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes |_| No |X|
(If "Yes" is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b):
82-_______________________.)
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Company has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
GRUPO SIMEC, S.A.B. de C.V.
--------------------------------------
(Registrant)
Date: July 24, 2009. By: /s/ Luis Garcia Limon
--------------------------------------
Name: Luis Garcia Limon
Title: Chief Executive Officer
PRESS RELEASE Contact: Sergio Vigil Gonzalez
Jose Flores Flores
Grupo Simec, S.A. de C.V.
Calzada Lazaro Cardenas 601
44440 Guadalajara, Jalisco, Mexico
52 55 1165 1025
52 33 3770 6734
GRUPO SIMEC ANNOUNCES RESULTS OF OPERATIONS FOR THE FIRST SIX MONTHS OF 2009
GUADALAJARA, MEXICO, July 23, 2009- Grupo Simec, S.A.B. de C.V. (AMEX: SIM)
("Simec") announced today its results of operations for the six-month period
ended June 30, 2009.
Six-Month Period Ended June 30, 2009 compared to Six-Month Period Ended June 30,
2008
Net Sales
Net sales decreased 46% to Ps. 9,242 million in the six-month period ended June
30, 2009 (including the net sales generated by the newly acquired plants of
Grupo San of Ps. 1,899 million) compared to Ps. 17,035 million in the same
period 2008 (including the net sales generated by the newly acquired plants of
Grupo San of Ps. 513 million). Shipments of finished steel products decreased
37% to 977 thousand tons in the six-month period ended June 30, 2009 (including
the net sales generated by the newly acquired plants of Grupo San of 252
thousand tons) compared to 1,562 thousand tons in the same period 2008
(including the net sales generated by the newly acquired plants of Grupo San of
44 thousand tons). Total sales outside of Mexico in the six-month period ended
June 30, 2009 decreased 69% to Ps. 3,760 million (including the net sales
generated by the newly acquired plants of Grupo San of Ps. 6 million) compared
with Ps. 12,172 million in the same period 2008, (including the net sales
generated by the newly acquired plants of Grupo San of Ps. 37 million) while
total Mexican sales increased 13% from Ps. 4,863 million in the six-month period
ended June 30, 2008 (including the net sales generated by the newly acquired
plants of Grupo San of Ps. 476 million) to Ps. 5,482 millions in the same period
2009 (including the net sales generated by the newly acquired plants of Grupo
San of Ps. 1,893 million). The decrease in sales is due to lower shipments
during the six-month period ended June 30, 2009, compared to the same period in
2008 (a 585,000 tons decrease). The average price of steel products decreased
13% in the six-month period ended June 30, 2009 compared with the same period of
2008.
Direct Cost of Sales
Direct cost of sales decreased 46% from Ps. 13,744 million in the six-month
period ended June 30, 2008 (including the cost of sales generated by the newly
acquired plants of Grupo San of Ps. 308 million) to Ps. 7,367 million in the
same period 2009 (including the cost of sales generated by the newly acquired
plants of Grupo San of Ps. 1,241 million). Direct cost of sales as a percentage
of net sales represented 80% in the six-month period ended June 30, 2009
compared to 81% in the same period 2008. The average cost of raw materials used
to produce steel products decreased 14% in the six-month period ended June 30,
2009 versus the same period 2008, primarily as a result of decreases in the
price of scrap and certain other raw materials.
Marginal Profit
Marginal profit in the six-month period ended June 30, 2009 was Ps. 1,875
million (including the marginal profit generated by the newly acquired plants of
Grupo San of Ps. 257 million) compared to Ps. 3,291 million in the same period
2008 (including the marginal profit generated by the newly acquired plants of
Grupo San of Ps. 205 million). Marginal profit as a percentage of net sales in
the six-month period ended June 30, 2009 was 20% compared to 19% in the same
period 2008. The decline in marginal profit is due to lower shipments of 37%
during the six-month period ended June 30, 2009 compared with the same period of
2008.
Operating Expenses
Operating expenses increased 42% to Ps. 1,128 million in the six-month period
ended June 30, 2009 (including the operating expenses from the newly acquired
plants of Grupo San of Ps. 222 million and the amortization of the tangible and
intangible assets of Ps. 179 million registered by the acquisition of Grupo San)
compared to Ps. 794 million in the same period 2008 (including the operating
expenses from the newly acquired plants of Grupo San of Ps. 53 million), and
represented 12% of net sales in the six-month period ended June 30, 2009 and 5%
of net sales in the same period 2008.
Operating Income
Operating income decreased 70% to Ps. 747 million for the six-month period ended
June 30, 2009 (including the operating income generated by the newly acquired
plants of Grupo San of Ps. 257 million) compared to Ps. 2,497 million in the
same period 2008 (including the operating income generated by the newly acquired
plants of Grupo San of Ps. 152 million). Operating income as a percentage of
net sales was 8% in the six-month period ended June 30, 2009 compared to 15% in
the same period 2008. The decline in operating income is due to lower shipments
of 37% during the six-month period ended June 30, 2009 compared with the same
period of 2008.
Comprehensive Financial Cost
Comprehensive financial cost in the six-month period ended June 30, 2009
represented an expense of Ps. 61 million compared with an expense of Ps. 258
million in the same period 2008. Net interest expense was Ps. 12 million in the
six-month period ended June 30, 2009 compared with a net interest income of Ps.
93 million in the same period 2008. At the same time, we registered an exchange
loss of Ps. 49 million in the six-month period ended June 30, 2009 compared with
an exchange loss of Ps. 351 million in the same period 2008, reflecting a 2.5%
increase in the value of the peso versus the dollar in the six-month period
ended June 30, 2009 compared to the same period of 2008.
Other Expenses (Income) net
The company recorded other income net of Ps. 0 million in the six-month period
ended June 30, 2009 compared to other income net of Ps. 4 million in the same
period 2008.
Income Taxes
Income Taxes recorded a provision of Ps. 161 million in the six-month period
ended June 30, 2009 (including the provision of Ps. 105 million of deferred
income taxes) compared to Ps. 726 million in the same period of 2008 (including
the provision of Ps. 342 million of deferred income taxes).
Net Income
As a result of the foregoing, net income decreased by 65% to Ps. 525 million in
the six-month period ended June 30, 2009 from Ps. 1,517 million in the same
period 2008.
Liquidity and Capital Resources
As of June 30, 2009, Simec's total consolidated debt consisted of U.S.
$2,602,000; U.S. $2,300,000 is a credit bank and U.S. $302,000 of 8 7/8%
medium-term notes ("MTN's") due 1998 (accrued interest on June 30, 2009 was U.S.
$404,455). As of December 31, 2008, Simec's total consolidated debt consisted of
U.S. $952,000; U.S. $650,000 is a credit bank and U.S. $302,000 of 8 7/8%
medium-term notes ("MTN's") due 1998 (accrued interest on December 31, 2008 was
U.S. $387,882).
Comparative second quarter 2009 vs first quarter 2009
Net Sales
Net sales decreased 18% from Ps. 5,081 million for the first quarter 2009 to Ps.
4,161 million for the second quarter 2009. Sales in tons of finished steel
decreased 7% to 471 thousand tons in the second quarter 2009 compared with 506
thousand tons in the first quarter 2009. The total sales outside of Mexico for
the second quarter 2009 decreased 31% to Ps. 1,538 million compared with Ps.
2,222 million for the first quarter 2009. Total Mexican sales decreased 8% to
2,623 million in the second quarter 2009 from Ps. 2,859 million in the first
quarter 2009. Prices of finished products sold in the second quarter 2009
decreased approximately 12% compared to the first quarter 2009.
Direct Cost of Sales
Direct cost of sales decreased 21% from Ps. 4,111 million in the first quarter
2009 to Ps. 3,256 million for the second quarter 2009. With respect to sales, in
the second quarter 2009, the direct cost of sales represents 78% compared to 81%
for the first quarter 2009. The average cost of raw materials used to produce
steel products decreased 14% in the second quarter 2009 versus the first quarter
2009, primarily as a result of decreases in the price of scrap and certain other
raw materials.
Marginal Profit
Marginal profit for the second quarter 2009 decreased 7% to Ps. 905 million
compared to Ps. 970 million in the first quarter 2009. The marginal profit as a
percentage of net sales for the second quarter 2009 was 21% compared with 19%
for the first quarter of 2009. The decline in marginal profit is due to lower
shipments of 7% during the second quarter 2009 compared with the first quarter
2009.
Operating Expenses
Operating expenses decreased 7% to Ps. 543 million in the second quarter 2009
compared to Ps. 585 million for the first quarter 2009. Operating expenses as a
percentage of net sales represented 13% during the second quarter 2009 and 12%
during the second quarter 2008.
Operating Income
Operating income decreased 6% from an operating income of Ps. 385 million in the
first quarter 2009 to Ps. 362 million of operating incomet for the second
quarter 2009. The operating income as a percentage of net sales in the second
quarter 2009 was 7% compared to 8% in the first quarter 2009. The decrease in
operating income is due to lower shipments of 7% during the second quarter 2009
compared with the first quarter 2009.
Comprehensive Financial Cost
Comprehensive financial cost for the second quarter 2009 represented an expense
of Ps. 121 million compared with an income of Ps. 60 million for the first
quarter 2009. Net interest expense was Ps. 8 million in the second quarter 2009
compared with Ps. 3 million of net interest expense in the first quarter 2009.
At the same time we registered an exchange loss of Ps. 113 million in the second
quarter 2009 compared with an exchange gain of Ps. 63 million in the first
quarter 2009.
Other Expenses (Income) net
The company recorded other expenses net of Ps. 1 million in the second quarter
2009 compared with other income net of Ps. 2 million for the first quarter 2009.
Income Taxes
Income Taxes for the second quarter 2009 was an expense of Ps. 154 million
compared to Ps. 7 million of expense for the first quarter 2009.
Net Income
As a result of the foregoing, net income was Ps. 86 million in the second
quarter 2009 compared to Ps. 440 million of net income in the first quarter
2009.
Comparative second quarter 2009 vs second quarter 2008
Net Sales
Net sales decreased 57% from Ps. 9,746 million for the second quarter 2008
(including the net sales generated by the newly acquired plants of Grupo San of
Ps. 513 million) to Ps. 4,161 million for the second quarter 2009 (including the
net sales generated by the newly acquired plants of Grupo San of Ps. 840
million). Sales in tons of finished steel decreased 42% to 471 thousand tons in
the second quarter 2009 compared with 817 thousand tons in the second quarter
2008. The total sales outside of Mexico for the second quarter 2009 decreased
77% to Ps. 1,538 million compared with Ps. 6,749 million for the second quarter
2008. Total Mexican sales decreased 12% to 2,623 million in the second quarter
2009 from Ps. 2,997 million in the second quarter 2008. Prices of finished
products sold in the second quarter 2009 decreased approximately 26% compared to
the second quarter 2008.
Direct Cost of Sales
Direct cost of sales decreased 58% from Ps. 7,693 million in the second quarter
2008 (including the cost of sales generated by the newly acquired plants of
Grupo San of Ps. 308 million) to Ps. 3,256 million for the second quarter 2009
(including the cost of sales generated by the newly acquired plants of Grupo San
of Ps. 584 million). With respect to sales, in the second quarter 2009, the
direct cost of sales represents 78% compared to 79% for the second quarter 2008.
The average cost of raw materials used to produce steel products decreased 25%
in the second quarter 2009 versus the second quarter 2008, primarily as a result
of decreases in the price of scrap and certain other raw materials.
Marginal Profit
Marginal profit for the second quarter 2009 decreased 56% to Ps. 905 million
(including the marginal profit generated by the newly acquired plants of Grupo
San of Ps. 256 million) compared to Ps. 2,053 million in the second quarter 2008
(including the marginal profit generated by the newly acquired plants of Grupo
San of Ps. 205 million). The marginal profit as a percentage of net sales for
the second quarter 2009 was 21% compared with 21% for the second quarter 2008.
The decline in marginal profit is due to lower shipments of 42% during the
second quarter 2009 compared with the second quarter 2008.
Operating Expenses
Operating expenses increased 25% to Ps. 543 million in the second quarter 2009
compared to Ps. 434 million for the second quarter 2008. Operating expenses as a
percentage of net sales represented 13% during the second quarter 2009 and 4%
during the second quarter 2008.
Operating Income
Operating income decreased 78% from an operating income of Ps. 1,619 million in
the second quarter 2008 (including the operating income generated by the newly
acquired plants of Grupo San of Ps. 152 million) to Ps. 362 million of operating
income for the second quarter 2009 (including the operating loss generated by
the newly acquired plants of Grupo San of Ps. 32 million). The operating income
as a percentage of net sales in the
second quarter 2009 was 7% compared to 17% in the second quarter 2008. The
decrease in operating income is due to lower shipments of 42% during the second
quarter 2009 compared with the second quarter 2008.
Comprehensive Financial Cost
Comprehensive financial cost for the second quarter 2009 represented an expense
of Ps. 121 million compared with an expense of Ps. 197 million for the second
quarter 2008. Net interest expense was Ps. 8 million in the second quarter 2009
compared with Ps. 37 million of net interest income in the second quarter 2008.
At the same time we registered an exchange loss of Ps. 113 million in the second
quarter 2009 compared with an exchange loss of Ps. 234 million in the second
quarter 2008.
Other Expenses (Income) net
The company recorded other expenses net of Ps. 1 million in the second quarter
2009 compared with other expense net of Ps. 2 million for the second quarter
2008.
Income Taxes
Income Taxes for the second quarter 2009 was an expense of Ps. 154 million
compared to Ps. 495 million of income for the second quarter 2008.
Net Income
As a result of the foregoing, net income was Ps. 86 million in the second
quarter 2009 compared to Ps. 925 million of net income in the second quarter
2008.
------------------------------------------------------------------------------
Millions of pesos Six months ended June Six months 2009
30, 2009 ended June 30, vs.
2008 2008
------------------------------------------------------------------------------
Sales 9,242 17,035 (46%)
------------------------------------------------------------------------------
Cost of Sales 7,367 13,744 (46%)
------------------------------------------------------------------------------
Marginal Profit 1,875 3,291 (43%)
------------------------------------------------------------------------------
Operating Expenses 1,128 794 42%
------------------------------------------------------------------------------
Operating Income 747 2,497 (70%)
------------------------------------------------------------------------------
EBITDA 1,292 2,763 (53%)
------------------------------------------------------------------------------
Net Profit 525 1,517 (65%)
------------------------------------------------------------------------------
Sales outside Mexico 3,760 12,172 (69%)
------------------------------------------------------------------------------
Sales in Mexico 5,482 4,863 13%
------------------------------------------------------------------------------
Total sales (tons) 977 1,562 (37%)
------------------------------------------------------------------------------
-------------------------------------------------------------------------------
(Millions of pesos) 2Q'09 vs 2Q'09 vs
2Q'09 1Q'09 2Q'08 1Q'09 2Q'08
-------------------------------------------------------------------------------
Sales 4,161 5,081 9,746 (18%) (57%)
-------------------------------------------------------------------------------
Cost of Sales 3,256 4,111 7,693 (21%) (58%)
-------------------------------------------------------------------------------
Marginal Profit 905 970 2,053 (7%) (56%)
-------------------------------------------------------------------------------
Operating Expenses 543 585 434 (7%) 25%
-------------------------------------------------------------------------------
Operating Income 362 385 1,619 (6%) (78%)
-------------------------------------------------------------------------------
EBITDA 632 660 1,755 (4%) (64%)
-------------------------------------------------------------------------------
Net Profit 86 440 925 (80%) (91%)
-------------------------------------------------------------------------------
Sales outside Mexico 1,538 2,222 6,749 (31%) (77%)
-------------------------------------------------------------------------------
Sales in Mexico 2,623 2,859 2,997 (8%) (12%)
-------------------------------------------------------------------------------
Total sales (tons) 471 506 817 (7%) (42%)
-------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
Thousands of Million Average Thousands of Million of Average
tons six of pesos price per tons six pesos six price per
months ended six months ton six months ended months ton six
June 30,2009 ended months June 30,2008 ended June months
June 30, ended June 30, 2008 ended June
Product 2009 30, 2009 30, 2008
----------------------------------------------------------------------------------------------
SBQ 416 4,641 11,156 1,144 12,873 11,253
----------------------------------------------------------------------------------------------
Light Structural 80 773 9,663 101 966 9,564
----------------------------------------------------------------------------------------------
Structural 95 959 10,095 110 1,120 10,182
----------------------------------------------------------------------------------------------
Rebar 328 2,377 7,247 194 1,875 9,665
----------------------------------------------------------------------------------------------
Others 58 492 - 13 201 -
----------------------------------------------------------------------------------------------
Total 977 9,242 9,460 1,562 17,035 10,906
----------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
Average Average
Thousands Millions price Thousands Millions Average Thousands Millions price
of tons of pesos per ton of tons of pesos price per of tons of pesos per ton
Product 2Q'09 2Q'09 Q'09 1Q'09 1Q'09 ton 1Q'09 2Q'08 2Q'08 2Q'08
----------------------------------------------------------------------------------------------------------------------
SBQ 201 2,020 10,050 215 2,621 12,191 579 7,124 12,304
----------------------------------------------------------------------------------------------------------------------
Light Structural 33 308 9,333 47 464 9,872 47 512 10,894
----------------------------------------------------------------------------------------------------------------------
Structural 45 452 10,044 50 507 10,140 55 616 11,200
----------------------------------------------------------------------------------------------------------------------
Rebar 165 1,136 6,885 163 1,241 7,613 124 1,325 10,685
----------------------------------------------------------------------------------------------------------------------
Others 27 245 - 31 248 - 12 169 -
----------------------------------------------------------------------------------------------------------------------
Total 471 4,161 8,834 506 5,081 10,042 817 9,746 11,929
----------------------------------------------------------------------------------------------------------------------
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.
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER:2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
CONSOLIDATED FINANCIAL STATEMENT
AT JUNE 30 OF 2009 AND 2008
(thousands of Mexican pesos)
----------------------------------------------------------------------------------------------------------------------
REF CONCEPTS CURRENT YEAR PREVIOUS YEAR
S
----------------------------------------------------------------------------------------------------------------------
AMOUNT % AMOUNT %
----------------------------------------------------------------------------------------------------------------------
s01 TOTAL ASSETS 30,653,915 100 23,319,233 100
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
s02 CURRENT ASSETS 13,156,456 43 12,731,537 43
----------------------------------------------------------------------------------------------------------------------
s03 CASH AND SHORT-TERM INVESTMENTS 1,296,471 4 682,959 2
----------------------------------------------------------------------------------------------------------------------
s04 ACCOUNTS AND NOTES RECEIVABLE (NET) 2,851,415 9 4,581,721 16
----------------------------------------------------------------------------------------------------------------------
s05 OTHER ACCOUNTS AND NOTES RECEIVABLE 567,661 2 485,979 2
----------------------------------------------------------------------------------------------------------------------
s06 INVENTORIES 8,197,742 27 6,740,789 23
----------------------------------------------------------------------------------------------------------------------
s07 OTHER CURRENT ASSETS 243,167 1 240,069 1
----------------------------------------------------------------------------------------------------------------------
s08 LONG-TERM 0 0 0 0
----------------------------------------------------------------------------------------------------------------------
s09 ACCOUNTS AND NOTES RECEIVABLE (NET) 0 0 0 0
----------------------------------------------------------------------------------------------------------------------
s10 INVESTMENT IN SHARES OF NON-CONSOLIDATED
SUBSIDIARIES AND ASSOCIATES 0 0 0 0
----------------------------------------------------------------------------------------------------------------------
s11 OTHER INVESTMENTS 0 0 0 0
----------------------------------------------------------------------------------------------------------------------
s12 PROPERTY, PLANT AND EQUIPMENT (NET) 10,006,587 33 9,413,206 32
----------------------------------------------------------------------------------------------------------------------
s13 LAND AND BULIDINGS 3,724,127 12 3,391,380 12
----------------------------------------------------------------------------------------------------------------------
s14 MACHINERY AND INDUSTRIAL EQUIPMENT 12,744,809 42 11,877,755 41
----------------------------------------------------------------------------------------------------------------------
s15 OTHER EQUIPMENT 231,917 1 230,955 1
----------------------------------------------------------------------------------------------------------------------
s16 ACCUMULATED DEPRECIATION 7,174,185 23 6,390,553 22
----------------------------------------------------------------------------------------------------------------------
s17 CONSTRUCTION IN PROGRESS 479,919 2 303,669 1
----------------------------------------------------------------------------------------------------------------------
s18 OTHER INTANGIBLE ASSETS AND DEFERRED ASSETS (NET) 7,368,649 24 7,071,947 24
----------------------------------------------------------------------------------------------------------------------
s19 OTHER ASSETS 122,223 0 102,543 0
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
s20 TOTAL LIABILITIES 8,912,103 100 9,647,944 100
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
s21 CURRENT LIABILITIES 4,525,964 51 6,080,054 63
----------------------------------------------------------------------------------------------------------------------
s22 SUPPLIERS 2,501,299 28 3,623,360 38
----------------------------------------------------------------------------------------------------------------------
s23 BANK LOANS 30,365 0 925,569 10
----------------------------------------------------------------------------------------------------------------------
s24 STOCK MARKET LOANS 3,987 0 3,106 0
----------------------------------------------------------------------------------------------------------------------
s103 OTHER LOANS WITH COST 0 0 0 0
----------------------------------------------------------------------------------------------------------------------
s25 TAXES PAYABLE 307,956 3 657,482 7
----------------------------------------------------------------------------------------------------------------------
s26 OTHER CURRENT LIABILITIES WITHOUT COST 1,682,357 19 870,537 9
----------------------------------------------------------------------------------------------------------------------
s27 LONG-TERM LIABILITIES 0 0 0 0
----------------------------------------------------------------------------------------------------------------------
s28 BANK LOANS 0 0 0 0
----------------------------------------------------------------------------------------------------------------------
s29 STOCK MARKET LOANS 0 0 0 0
----------------------------------------------------------------------------------------------------------------------
s30 OTHER LOANS WITH COST 0 0 0 0
----------------------------------------------------------------------------------------------------------------------
s31 DEFERRED LIABILITIES 0 0 0 0
----------------------------------------------------------------------------------------------------------------------
s32 OTHER NON-CURRENT LIABILITIES WITHOUT COST 4,386,139 49 3,567,890 37
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
s33 CONSOLIDATED STOCKHOLDERS' EQUITY 21,741,812 100 19,671,289 100
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
s34 MINORITY INTEREST 2,760,394 13 2,653,495 13
----------------------------------------------------------------------------------------------------------------------
s35 MAJORITY INTEREST 18,981,418 87 17,017,794 87
----------------------------------------------------------------------------------------------------------------------
s36 CONTRIBUTED CAPITAL 8,350,900 38 8,350,900 42
----------------------------------------------------------------------------------------------------------------------
S79 CAPITAL STOCK 4,142,696 19 4,030,427 23
----------------------------------------------------------------------------------------------------------------------
s39 PREMIUM ON ISSUANCE OF SHARES 4,208,204 19 3,151,317 16
----------------------------------------------------------------------------------------------------------------------
s40 CONTRIBUTIONS FOR FUTURE CAPITAL INCREASES 0 0 1,169,156 6
----------------------------------------------------------------------------------------------------------------------
s41 EARNED CAPITAL 10,630,518 49 8,666,894 44
----------------------------------------------------------------------------------------------------------------------
s42 RETAINED EARNINGS AND CAPITAL RESERVES 10,329,465 48 9,807,191 50
----------------------------------------------------------------------------------------------------------------------
s44 OTHER ACCUMULATED COMPREHENSIVE RESULT 301,053 1 (1,140,297) (6)
----------------------------------------------------------------------------------------------------------------------
s80 SHARES REPURCHASED 0 0 0 0
----------------------------------------------------------------------------------------------------------------------
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
CONSOLIDATED FINANCIAL STATEMENT
BREAKDOWN OF MAIN CONCEPTS
(thousands of Mexican pesos)
---------------------------------------------------------------------------------------------------------------------------
REF CONCEPTS CURRENT YEAR PREVIOUS YEAR
S
---------------------------------------------------------------------------------------------------------------------------
AMOUNT % AMOUNT %
---------------------------------------------------------------------------------------------------------------------------
s03 CASH AND SHORT-TERM INVESTMENTS 1,296,471 100 682,959 100
---------------------------------------------------------------------------------------------------------------------------
s46 CASH 1,011,824 78 477,752 70
---------------------------------------------------------------------------------------------------------------------------
s47 SHORT-TERM INVESTMENTS 284,647 22 205,207 30
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
s07 OTHER CURRENT ASSETS 243,167 100 240,089 100
---------------------------------------------------------------------------------------------------------------------------
s81 DERIVATIVE FINANCIAL INSTRUMENTS 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s82 DISCONTINUED OPERATIONS 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s83 OTHER 243,167 100 240,089 100
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
s18 OTHER INTANGIBLE ASSETS AND DEFERRED ASSETS (NET) 7,368,649 100 7,071,947 100
---------------------------------------------------------------------------------------------------------------------------
s48 DEFERRED EXPENSES 3,153,149 43 281,730 4
---------------------------------------------------------------------------------------------------------------------------
s49 GOODWILL 4,166,160 57 6,688,578 95
---------------------------------------------------------------------------------------------------------------------------
s51 OTHER 49,340 1 101,639 1
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
s19 OTHER ASSETS 122,223 100 102,543 100
---------------------------------------------------------------------------------------------------------------------------
s84 INTANGIBLE ASSET FROM LABOR OBLIGATIONS 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s85 DERIVATIVE FINANCIAL INSTRUMENTS 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s50 DEFERRED TAXES 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s86 DISCONTINUED OPERATIONS 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s87 OTHER 122,223 100 102,543 100
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
s21 CURRENT LIABILITIES 4,525,964 100 6,080,054 100
---------------------------------------------------------------------------------------------------------------------------
s52 FOREIGN CURRENCY LIABILITIES 1,962,229 43 1,876,180 31
---------------------------------------------------------------------------------------------------------------------------
s53 MEXICAN PESOS LIABILITIES 2,563,735 57 4,203,874 69
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
s26 OTHER CURRENT LIABILITIES WITHOUT COST 1,682,357 100 870,537 100
---------------------------------------------------------------------------------------------------------------------------
s88 DERIVATIVE FINANCIAL INSTRUMENTS 331,580 20 0 0
---------------------------------------------------------------------------------------------------------------------------
s89 INTEREST LIABILITIES 5,340 0 3,880 0
---------------------------------------------------------------------------------------------------------------------------
s68 PROVISIONS 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s90 DISCONTINUED OPERATIONS 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s58 OTHER CURRENT LIABILITIES 1,345,437 80 866,657 100
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
s27 LONG-TERM LIABILITIES 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s59 FOREIGN CURRENCY LIABILITIES 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s60 MEXICAN PESOS LIABILITIES 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
s31 DEFERRED LIABILITIES 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s65 NEGATIVE GOODWILL 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s67 OTHER 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
s32 OTHER NON CURRENT LIABILITIES WITHOUT COST 4,386,139 100 3,567,890 100
---------------------------------------------------------------------------------------------------------------------------
s66 DEFERRED TAXES 4,305,403 98 3,395,141 95
---------------------------------------------------------------------------------------------------------------------------
s91 OTHER LIABILITIES IN RESPECT OF SOCIAL INSURANCE 32,316 1 113,268 3
---------------------------------------------------------------------------------------------------------------------------
s92 DISCONTINUED OPERATIONS 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s69 OTHER LIABILITIES 48,420 1 59,481 2
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
s79 CAPITAL STOCK 4,142,696 100 4,030,427 100
---------------------------------------------------------------------------------------------------------------------------
s37 CAPITAL STOCK (NOMINAL) 2,420,230 58 2,308,106 57
---------------------------------------------------------------------------------------------------------------------------
s69 RESTATEMENT OF CAPITAL STOCK 1,722,466 42 1,722,321 43
---------------------------------------------------------------------------------------------------------------------------
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
CONSOLIDATED FINANCIAL STATEMENT
BREAKDOWN OF MAIN CONCEPTS
(thousands of Mexican pesos)
---------------------------------------------------------------------------------------------------------------------------
REF CONCEPTS CURRENT YEAR PREVIOUS YEAR
S
---------------------------------------------------------------------------------------------------------------------------
AMOUNT % AMOUNT %
---------------------------------------------------------------------------------------------------------------------------
s42 RETAINED EARNINGS AND CAPITAL RESERVES 10,329,465 100 9,807,191 100
---------------------------------------------------------------------------------------------------------------------------
s93 LEGAL RESERVE 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s43 RESERVE FOR REPURCHASE OF SHARES 200,612 2 200,612 2
---------------------------------------------------------------------------------------------------------------------------
s94 OTHER RESERVES 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s95 RETAINED EARNINGS 9,307,346 90 8,481,722 86
---------------------------------------------------------------------------------------------------------------------------
s45 NET INCOME FOR THE YEAR 821,507 8 1,124,857 11
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
s44 OTHER ACCUMULATED COMPREHENSIVE RESULT 301,053 100 (1,140,297) 100
---------------------------------------------------------------------------------------------------------------------------
s70 ACCUMULATED MONETARY RESULT 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s71 RESULT FROM HOLDING NON-MONETARY ASSETS 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s96 CUMULATIVE RESULT FROM FOREIGN CURRENCY TRANSLATION
539,791 179 (169,784) 15
---------------------------------------------------------------------------------------------------------------------------
s97 CUMULATIVE RESULT FROM DERIVATIVE FINANCIAL INSTRUMENTS
(238,738) (79) 0 0
---------------------------------------------------------------------------------------------------------------------------
s98 CUMULATIVE EFFECT OF DEFERRED INCOME TAXES 0 0 (970,513) 85
---------------------------------------------------------------------------------------------------------------------------
s99 LABOR OBLIGATION ADJUSTMENT 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
s100 OTHER 0 0 0 0
---------------------------------------------------------------------------------------------------------------------------
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A. DE C.V.
BALANCE SHEETS
OTHER CONCEPTS
(thousands of Mexican pesos)
-------------------------------------------------------------------------------------------------------------------
REF CONCEPTS CURRENT YEAR PREVIOUS YEAR
S
-------------------------------------------------------------------------------------------------------------------
AMOUNT AMOUNT
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
S72 WORKING CAPITAL 8,630,492 6,651,483
-------------------------------------------------------------------------------------------------------------------
S73 PENSIONS FUND AND SENIORITY PREMIUMS 0 98,990
-------------------------------------------------------------------------------------------------------------------
S74 EXECUTIVES (*) 60 60
-------------------------------------------------------------------------------------------------------------------
S75 EMPLOYERS (*) 1,640 2,077
-------------------------------------------------------------------------------------------------------------------
S76 WORKERS (*) 2,569 3,855
-------------------------------------------------------------------------------------------------------------------
S77 COMMON SHARES (*) 497,709,214 474,621,611
-------------------------------------------------------------------------------------------------------------------
S78 REPURCHASED SHARES (*) 0 0
-------------------------------------------------------------------------------------------------------------------
S101 RESTRICTED CASH 0 0
-------------------------------------------------------------------------------------------------------------------
S102 NET DEBT OF NON CONSOLIDATED COMPANIES 508,288 0
-------------------------------------------------------------------------------------------------------------------
(*) THESE ITEMS SHOULD BE EXPRESSED IN UNITS
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
STATEMENTS OF INCOME
FROM JANUARY 1 TO JUNE 30 OF 2009 AND 2008
(thousands of Mexican pesos)
------------------------------------------------------------------------------------------------------------------------
REF CATEGORIES CURRENT YEAR PREVIOUS YEAR
R
------------------------------------------------------------------------------------------------------------------------
AMOUNT % AMOUNT %
------------------------------------------------------------------------------------------------------------------------
r01 NET SALES 9,242,065 100 17,034,660 100
------------------------------------------------------------------------------------------------------------------------
r02 COST OF SALES 7,367,072 80 13,743,665 81
------------------------------------------------------------------------------------------------------------------------
r03 GROSS PROFIT 1,874,993 20 3,290,995 19
------------------------------------------------------------------------------------------------------------------------
r04 OPERATING EXPENSES 1,128,430 12 793,922 5
------------------------------------------------------------------------------------------------------------------------
r05 OPERATING INCOME 746,563 8 2,497,073 15
------------------------------------------------------------------------------------------------------------------------
r08 OTHER INCOME AND (EXPENSE), NET 469 0 3,970 0
------------------------------------------------------------------------------------------------------------------------
r06 COMPREHENSIVE FINANCING RESULT (60,645) 0 (258,458) (2)
------------------------------------------------------------------------------------------------------------------------
r12 EQUITY IN NET INCOME OF NON-CONSOLIDATED SUBSIDIARIES AND
ASSOCIATES 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
r48 NON ORDINARY ITEMS 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
r09 INCOME BEFORE INCOME TAXES 686,387 7 2,242,585 13
------------------------------------------------------------------------------------------------------------------------
r10 INCOME TAXES 160,775 2 725,611 4
------------------------------------------------------------------------------------------------------------------------
r11 INCOME (LOSS) BEFORE DISCONTINUED OPERATIONS 525,612 6 1,516,974 9
------------------------------------------------------------------------------------------------------------------------
r14 DISCONTINUED OPERATIONS 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
r18 NET CONSOLIDATED INCOME 525,612 6 1,516,974 9
------------------------------------------------------------------------------------------------------------------------
r19 NET INCOME OF MINORITY INTEREST (295,895) (3) 392,117 2
------------------------------------------------------------------------------------------------------------------------
r20 NET INCOME OF MAJORITY INTEREST 821,507 9 1,124,857 7
------------------------------------------------------------------------------------------------------------------------
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
STATEMENTS OF INCOME
BREAKDOWN OF MAIN CONCEPTS
(thousands of Mexican pesos)
-------------------------------------------------------------------------------------------------------------------------
REF CONCEPTS CURRENT YEAR PREVIOUS YEAR
R
-------------------------------------------------------------------------------------------------------------------------
AMOUNT % AMOUNT %
------------------------------------------------------------------------------------------------------------------------
r01 NET SALES 9,242,065 100 17,034,660 100
------------------------------------------------------------------------------------------------------------------------
r21 DOMESTIC 5,481,918 59 4,862,354 29
------------------------------------------------------------------------------------------------------------------------
r22 FOREIGN 3,760,147 41 12,172,306 71
------------------------------------------------------------------------------------------------------------------------
r23 TRANSLATED INTO DOLLARS (***) 269,294 1,152,841
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
r08 OTHER INCOME AND (EXPENSE), NET 469 100 3,970 100
------------------------------------------------------------------------------------------------------------------------
r49 OTHER INCOME AND (EXPENSE), NET 469 100 14,685 370
------------------------------------------------------------------------------------------------------------------------
r34 EMPLOYEES' PROFIT SHARING EXPENSES 0 0 10,715 270
------------------------------------------------------------------------------------------------------------------------
r35 DEFERRED EMPLOYEES' PROFIT SHARING 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
r06 COMPREHENSIVE FINANCING RESULT (60,645) 100 (258,458) 100
------------------------------------------------------------------------------------------------------------------------
r24 INTEREST EXPENSE 29,622 (49) 14,280 (6)
------------------------------------------------------------------------------------------------------------------------
r42 GAIN (LOSS) ON RESTATEMENT OF UDI'S 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
r45 OTHER FINANCE COSTS 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
r26 INTEREST INCOME 18,082 30 106,609 41
------------------------------------------------------------------------------------------------------------------------
r46 OTHER FINANCIAL PRODUCTS 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
r25 FOREIGN EXCHANGE GAIN (LOSS), NET (49,105) (81) (350,787) (136)
------------------------------------------------------------------------------------------------------------------------
r28 RESULT FROM MONETARY POSITION 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
r10 INCOME TAXES 160,775 100 725,611 100
------------------------------------------------------------------------------------------------------------------------
r32 INCOME TAX 55,990 35 383,276 53
------------------------------------------------------------------------------------------------------------------------
r33 DEFERRED INCOME TAX 104,785 65 342,335 47
------------------------------------------------------------------------------------------------------------------------
(***) THOUSANDS OF DOLLARS
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
STATEMENTS OF INCOME
OTHER CONCEPTS
(thousands of Mexican pesos)
-------------------------------------------------------------------------------------------------------------------
REF CONCEPTS CURRENT YEAR PREVIOUS YEAR
R
-------------------------------------------------------------------------------------------------------------------
AMOUNT AMOUNT
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
r36 TOTAL SALES 9,496,823 17,271,602
-------------------------------------------------------------------------------------------------------------------
r37 TAX RESULT FOR THE YEAR 0 0
-------------------------------------------------------------------------------------------------------------------
r38 NET SALES (**) 27,392,625 28,583,872
-------------------------------------------------------------------------------------------------------------------
r39 OPERATION INCOME (**) 1,364,719 3,077,882
-------------------------------------------------------------------------------------------------------------------
r40 NET INCOME OF MAJORITY INTEREST (**) 1,492,787 1,678,350
-------------------------------------------------------------------------------------------------------------------
r41 NET CONSOLIDATED INCOME (**) 908,987 1,946,380
-------------------------------------------------------------------------------------------------------------------
r47 OPERATIVE DEPRECIATION AND AMORTIZATION 544,749 266,162
-------------------------------------------------------------------------------------------------------------------
(**) RESTATED INFORMATION FOR THE LAST TWELVE MONTHS
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
QUARTERLY STATEMENTS OF INCOME
FROM APRIL 1 TO JUNE 30 OF 2009 AND 2008
(thousands of Mexican pesos)
------------------------------------------------------------------------------------------------------------------------
REF CATEGORIES CURRENT YEAR PREVIOUS YEAR
R
------------------------------------------------------------------------------------------------------------------------
AMOUNT % AMOUNT %
------------------------------------------------------------------------------------------------------------------------
r01 NET SALES 4,161,424 100 9,746,693 100
------------------------------------------------------------------------------------------------------------------------
r02 COST OF SALES 3,256,342 78 7,693,302 79
------------------------------------------------------------------------------------------------------------------------
r03 GROSS PROFIT 905,082 22 2,053,391 21
------------------------------------------------------------------------------------------------------------------------
r04 OPERATING EXPENSES 543,148 13 434,548 4
------------------------------------------------------------------------------------------------------------------------
r05 OPERATING INCOME 361,934 9 1,618,843 17
------------------------------------------------------------------------------------------------------------------------
r08 OTHER INCOME AND (EXPENSE), NET (1,383) 0 (1,729) 0
------------------------------------------------------------------------------------------------------------------------
r06 COMPREHENSIVE FINANCING RESULT (120,570) (3) (196,599) (2)
------------------------------------------------------------------------------------------------------------------------
r12 EQUITY IN NET INCOME OF NON-CONSOLIDATED SUBSIDIARIES AND
ASSOCIATES 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
r48 NON ORDINARY ITEMS 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
r09 INCOME BEFORE INCOME TAXES 239,981 6 1,420,515 15
------------------------------------------------------------------------------------------------------------------------
r10 INCOME TAXES 154,041 4 495,431 5
------------------------------------------------------------------------------------------------------------------------
r11 INCOME (LOSS) BEFORE DISCONTINUED OPERATIONS 85,940 2 925,084 9
------------------------------------------------------------------------------------------------------------------------
r14 DISCONTINUED OPERATIONS 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
r18 NET CONSOLIDATED INCOME 85,940 2 925,084 9
------------------------------------------------------------------------------------------------------------------------
r19 NET INCOME OF MINORITY INTEREST (190,672) (5) 273,100 3
------------------------------------------------------------------------------------------------------------------------
r20 NET INCOME OF MAJORITY INTEREST 276,612 7 651,984 7
------------------------------------------------------------------------------------------------------------------------
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
QUARTERLY STATEMENTS OF INCOME
BREAKDOWN OF MAIN CONCEPTS
(thousands of Mexican pesos)
------------------------------------------------------------------------------------------------------------------------
REF CONCEPTS CURRENT YEAR PREVIOUS YEAR
R
------------------------------------------------------------------------------------------------------------------------
AMOUNT % AMOUNT %
------------------------------------------------------------------------------------------------------------------------
rt01 NET SALES 4,161,424 100 9,746,693 100
------------------------------------------------------------------------------------------------------------------------
rt21 DOMESTIC 2,622,826 63 2,997,397 31
------------------------------------------------------------------------------------------------------------------------
rt22 FOREIGN 1,538,598 37 6,749,296 69
------------------------------------------------------------------------------------------------------------------------
rt23 TRANSLATED INTO DOLLARS (***) 115,784 646,224
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
rt08 OTHER INCOME AND (EXPENSE), NET (1,383) 100 (1,729) 100
------------------------------------------------------------------------------------------------------------------------
rt49 OTHER INCOME AND (EXPENSE), NET (1,383) 100 8,986 520
------------------------------------------------------------------------------------------------------------------------
rt34 EMPLOYEES' PROFIT SHARING EXPENSES 0 0 10,715 (620)
------------------------------------------------------------------------------------------------------------------------
rt35 DEFERRED EMPLOYEES' PROFIT SHARING 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
rt06 COMPREHENSIVE FINANCING RESULT (120,570) 100 (196,599) 100
------------------------------------------------------------------------------------------------------------------------
rt24 INTEREST EXPENSE 16,144 (13) 9,232 (5)
------------------------------------------------------------------------------------------------------------------------
rt42 GAIN (LOSS) ON RESTATEMENT OF UDI'S 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
rt45 OTHER FINANCE COSTS 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
rt26 INTEREST INCOME 8,287 7 46,187 23
------------------------------------------------------------------------------------------------------------------------
rt46 OTHER FINANCIAL PRODUCTS 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
rt25 FOREIGN EXCHANGE GAIN (LOSS), NET (112,713) (93) (233,554) (119)
------------------------------------------------------------------------------------------------------------------------
rt28 RESULT FROM MONETARY POSITION 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
rt10 INCOME TAXES 154,041 100 495,431 100
------------------------------------------------------------------------------------------------------------------------
rt32 INCOME TAX 216,099 140 263,441 53
------------------------------------------------------------------------------------------------------------------------
rt33 DEFERRED INCOME TAX (62,058) (40) 231,990 47
------------------------------------------------------------------------------------------------------------------------
(***) THOUSANDS OF DOLLARS
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
QUARTERLY STATEMENTS OF INCOME
OTHER CONCEPTS
(thousands of Mexican pesos)
-----------------------------------------------------------------------------------------------------------------------------
REF CONCEPTS CURRENT YEAR PREVIOUS YEAR
RT
-----------------------------------------------------------------------------------------------------------------------------
AMOUNT AMOUNT
-----------------------------------------------------------------------------------------------------------------------------
rt47 OPERATIVE DEPRECIATION AND AMORTIZATION 269,832 136,102
-----------------------------------------------------------------------------------------------------------------------------
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
STATE OF CASH FLOW (INDIRECT METHOD)
FROM JANUARY 1 TO JUNE 30 OF 2009 AND 2008
(thousands of pesos)
---------------------------------------------------------------------------------------------------------------------
REF CONCEPTS CURRENT YEAR PREVIOUS YEAR
C
---------------------------------------------------------------------------------------------------------------------
AMOUNT AMOUNT
---------------------------------------------------------------------------------------------------------------------
ACTIVITIES OF OPERATION
---------------------------------------------------------------------------------------------------------------------
e01 INCOME (LOSS) BEFORE INCOME TAXES 686,387 2,242,585
---------------------------------------------------------------------------------------------------------------------
e02 + (-) ITEMS NOT REQUIRING CASH 0 152,261
---------------------------------------------------------------------------------------------------------------------
e03 + (-) ITEMS RELATED TO INVESTING ACTIVITIES 515,781 159,553
---------------------------------------------------------------------------------------------------------------------
e04 + (-) ITEMS RELATED TO FINANCING ACTIVITIES 29,622 14,280
---------------------------------------------------------------------------------------------------------------------
e05 CASH FLOW BEFORE INCOME TAX 1,231,790 2,568,679
---------------------------------------------------------------------------------------------------------------------
e06 CASH FLOW PROVIDED OR USED IN OPERATION (427,593) (1,596,374)
---------------------------------------------------------------------------------------------------------------------
e07 CASH FLOW PROVIDED OF OPERATING ACTIVITIES 804,197 972,305
---------------------------------------------------------------------------------------------------------------------
INVESTMENT ACTIVITIES
---------------------------------------------------------------------------------------------------------------------
e08 NET CASH FLOW FROM INVESTING ACTIVITIES (100,506) (8,522,620)
---------------------------------------------------------------------------------------------------------------------
e09 CASH FLOW AFTER INVESTING ACTIVITIES 703,691 (7,550,315)
---------------------------------------------------------------------------------------------------------------------
FINANCING ACTIVITIES
---------------------------------------------------------------------------------------------------------------------
e10 NET CASH FROM FINANCING ACTIVITIES 15,395 2,102,432
---------------------------------------------------------------------------------------------------------------------
e11 NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS 719,086 (5,447,883)
---------------------------------------------------------------------------------------------------------------------
e12 TRANSLATION DIFFERENCES IN CASH AND CASH EQUIVALENTS 644 (265,313)
---------------------------------------------------------------------------------------------------------------------
e13 CASH AND CASH EQUIVALENTS AT THE BEGINNING OF PERIOD 576,741 6,396,155
---------------------------------------------------------------------------------------------------------------------
e14 CASH AND CASH EQUIVALENTS AT THE END OF PERIOD 1,296,471 682,959
---------------------------------------------------------------------------------------------------------------------
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
STATE OF CASH FLOW (INDIRECT METHOD)
BREAKDOWN OF MAIN CONCEPTS
(thousands of pesos)
-------------------------------------------------------------------------------------------------------------------
REF CONCEPTS CURRENT YEAR PREVIOUS YEAR
C
-------------------------------------------------------------------------------------------------------------------
AMOUNT AMOUNT
-------------------------------------------------------------------------------------------------------------------
e02 + (-) ITEMS NOT REQUIRING CASH 0 152,261
-------------------------------------------------------------------------------------------------------------------
e15 + ESTIMATES FOR THE PERIOD 0 0
-------------------------------------------------------------------------------------------------------------------
e16 + PROVISIONS FOR THE PERIOD 0 152,261
-------------------------------------------------------------------------------------------------------------------
e17 + (-) OTHER UNREALIZED ITEMS 0 0
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
e03 + (-) ITEMS RELATED TO INVESTING ACTIVITIES 515,781 159,553
-------------------------------------------------------------------------------------------------------------------
e18 + DEPRECIATION AND AMORTIZATION FOR THE PERIOD 544,749 266,162
-------------------------------------------------------------------------------------------------------------------
e19 (-) + GAIN OR LOSS ON SALE PROPERTY, PLANT AND EQUIPMENT 0 0
-------------------------------------------------------------------------------------------------------------------
e20 + IMPAIRMENT LOSS 0 0
-------------------------------------------------------------------------------------------------------------------
e21 (-) + EQUITY IN RESULTS OF ASSOCIATES AND JOINT VENTURES 0 0
-------------------------------------------------------------------------------------------------------------------
e22 (-) DIVIDENDS RECEIVED 0 0
-------------------------------------------------------------------------------------------------------------------
e23 (-) INTEREST INCOME (18,082) (106,609)
-------------------------------------------------------------------------------------------------------------------
e24 (-) + OTHER ITEMS (10,886) 0
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
e04 + (-) ITEMS RELATED TO FINANCING ACTIVITIES 29,622 14,280
-------------------------------------------------------------------------------------------------------------------
e25 + ACCRUED INTEREST 29,622 14,280
-------------------------------------------------------------------------------------------------------------------
e26 + (-) OTHER ITEMS 0 0
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
e06 CASH FLOW PROVIDED OR USED IN OPERATION (427,593) (1,596,374)
-------------------------------------------------------------------------------------------------------------------
e27 + (-) DECREASE (INCREASE) IN ACCOUNTS RECEIVABLE 4,869 (1,707,977)
-------------------------------------------------------------------------------------------------------------------
e28 + (-) DECREASE (INCREASE) IN INVENTORIES 515,955 (1,163,022)
-------------------------------------------------------------------------------------------------------------------
e29 + (-)DECREASE (INCREASE) IN IN OTHER ACCOUNT RECEIVABLES (258,223) 181,340
-------------------------------------------------------------------------------------------------------------------
e30 + (-) INCREASE DECREASE IN SUPPLIERS (812,057) 1,273,403
-------------------------------------------------------------------------------------------------------------------
e31 + (-)INCREASE DECREASE IN OTHER LIABILITIES 534,663 20,141
-------------------------------------------------------------------------------------------------------------------
e32 + (-) INCOME TAXES PAID OR RETURNED (412,800) (200,259)
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
e08 NET CASH FLOW FROM INVESTING ACTIVITIES (100,506) (8,522,620)
-------------------------------------------------------------------------------------------------------------------
e33 (-) PERMANENT INVESTMENT IN SHARES 0 0
-------------------------------------------------------------------------------------------------------------------
e34 + DISPOSITION OF PERMANENT INVESTMENT IN SHARES 0 (8,437,170)
-------------------------------------------------------------------------------------------------------------------
e35 (-) INVESTMENT IN PROPERTY PLANT AND EQUIPMENT (118,588) (192,059)
-------------------------------------------------------------------------------------------------------------------
e36 + SALE OF PROPERTY PLANT AND EQUIPMENT 0 0
-------------------------------------------------------------------------------------------------------------------
e37 (-) INVESTMENT IN INTANGIBLE ASSETS 0 0
-------------------------------------------------------------------------------------------------------------------
e38 + DISPOSITION OF INTANGIBLE ASSETS 0 0
-------------------------------------------------------------------------------------------------------------------
e39 + OTHER PERMANENT INVESTMENTS 0 0
-------------------------------------------------------------------------------------------------------------------
e40 + DISPOSITION OF OTHER PERMANENT INVESTMENTS 0 0
-------------------------------------------------------------------------------------------------------------------
e41 + DIVIDEND RECEIVED 0 0
-------------------------------------------------------------------------------------------------------------------
e42 + INTEREST RECEIVED 18,082 106,609
-------------------------------------------------------------------------------------------------------------------
e43 + (-) DECREASE (INCREASE) ADVANCES AND LOANS TO THIRD PARTS 0 0
-------------------------------------------------------------------------------------------------------------------
e44 + (-) OTHER ITEMS 0 0
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
e10 NET CASH FRON FINANCING ACTIVITIES 15,395 2,102,432
-------------------------------------------------------------------------------------------------------------------
e45 + BANK FINANCING 20,061 1,234,092
-------------------------------------------------------------------------------------------------------------------
e46 + STOCK MARKET FINANCING 0 (176)
-------------------------------------------------------------------------------------------------------------------
e47 + OTHER FINANCING 0 0
-------------------------------------------------------------------------------------------------------------------
e48 (-) BANK FINANCING AMORTIZATION 0 (308,523)
-------------------------------------------------------------------------------------------------------------------
e49 (-) STOCK MARKET FINANCING AMORTIZATION 0 0
-------------------------------------------------------------------------------------------------------------------
e50 (-) OTHER FINANCING AMORTIZATION 0 0
-------------------------------------------------------------------------------------------------------------------
e51 + (-) INCREASE (DECREASE ) IN CAPITAL STOCK 0 0
-------------------------------------------------------------------------------------------------------------------
e52 (-) DIVIDENS PAID 0 0
-------------------------------------------------------------------------------------------------------------------
e53 + PREMIUM ON ISSUANCE OF SHARES 0 0
-------------------------------------------------------------------------------------------------------------------
e54 + CONTRIBUTIONS FOR FUTURE CAPITAL INCREASES 0 1,169,156
-------------------------------------------------------------------------------------------------------------------
e55 (-) INTEREST EXPENSE (20,192) (14,280)
-------------------------------------------------------------------------------------------------------------------
e56 (-) REPURCHASE OF SHARES 0 0
-------------------------------------------------------------------------------------------------------------------
e57 + (-) OTHER ITEMS 15,526 22,163
-------------------------------------------------------------------------------------------------------------------
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
DATE PER SHARE
CONSOLIDATED
---------------------------------------------------------------------------------------------------------------------------
REF CATEGORIES QUARTER OF PRESENT QUARTER OF PREVIOUS
D FINANCIAL YEAR FINANCIAL YEAR
---------------------------------------------------------------------------------------------------------------------------
d01 BASIC PROFIT PER ORDINARY SHARE (**) $ 1.83 $ 3.54
---------------------------------------------------------------------------------------------------------------------------
d02 BASIC PROFIT PER PREFERRED SHARE (**) $ 0.00 $ 0.00
---------------------------------------------------------------------------------------------------------------------------
d03 DILUTED PROFIT PER ORDINARY SHARE (**) $ 0.00 $ 0.00
---------------------------------------------------------------------------------------------------------------------------
d04 EARNINGS (LOSS) BEFORE DISCONTINUED OPERATIONS PER COMMON
SHARE (**) $ 1.83 $ 3.54
---------------------------------------------------------------------------------------------------------------------------
d05 DISCONTINUED OPERATIONS EFFECT ON EARNING (LOSS) PER SHARE (**) $ 0.00 $ 0.00
---------------------------------------------------------------------------------------------------------------------------
d08 CARRYING VALUE PER SHARE $ 38.14 $ 35.86
---------------------------------------------------------------------------------------------------------------------------
d09 CASH DIVIDEND ACCUMULATED PER SHARE $ 0.00 $ 0.00
---------------------------------------------------------------------------------------------------------------------------
d10 DIVIDEND IN SHARES PER SHARE 0.00 shares 0.00 shares
---------------------------------------------------------------------------------------------------------------------------
d11 MARKET PRICE TO CARRYING VALUE 0.75 times 1.63 times
---------------------------------------------------------------------------------------------------------------------------
d12 MARKET PRICE TO BASIC PROFIT PER ORDINARY SHARE 15.72 times 16.48 times
---------------------------------------------------------------------------------------------------------------------------
d13 MARKET PRICE TO BASIC PROFIT PER PREFERENT SHARE (**) 0.00 times 0.00 times
---------------------------------------------------------------------------------------------------------------------------
(**) TO CALCULATE THE DATE PER SHARE USE THE NET INCOME FOR THE LAST TWELVE
MONTHS.
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
RATIOS
CONSOLIDATED
---------------------------------------------------------------------------------------------------------------------------
REF CATEGORIES QUARTER OF PRESENT QUARTER OF PREVIOUS
P FINANCIAL YEAR FINANCIAL YEAR
---------------------------------------------------------------------------------------------------------------------------
YIELD
---------------------------------------------------------------------------------------------------------------------------
p01 NET INCOME TO NET SALES 5.69% 8.91%
---------------------------------------------------------------------------------------------------------------------------
p02 NET INCOME TO STOCKHOLDERS' EQUITY (**) 4.18% 9.89%
---------------------------------------------------------------------------------------------------------------------------
p03 NET INCOME TO TOTAL ASSETS (**) 2.97% 6.64%
---------------------------------------------------------------------------------------------------------------------------
p04 CASH DIVIDENDS TO PREVIOUS YEAR NET INCOME 0.00% 0.00%
---------------------------------------------------------------------------------------------------------------------------
p05 INCOME DUE TO MONETARY POSITION TO NET INCOME 0.00% 0.00%
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
ACTIVITY
---------------------------------------------------------------------------------------------------------------------------
p06 NET SALES TO NET ASSETS (**) 0.89 times 0.97 times
---------------------------------------------------------------------------------------------------------------------------
p07 NET SALES TO FIXED ASSETS (**) 2.74 times 3.04 times
---------------------------------------------------------------------------------------------------------------------------
p08 INVENTORIES TURNOVER (**) 2.86 times 4.96 times
---------------------------------------------------------------------------------------------------------------------------
p09 ACCOUNTS RECEIVABLE IN DAYS OF SALES 48 days 42 days
---------------------------------------------------------------------------------------------------------------------------
p10 PAID INTEREST TO TOTAL LIABILITIES WITH COST (**) 5.46% 2.72%
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
LEVERAGE
---------------------------------------------------------------------------------------------------------------------------
p11 TOTAL LIABILITIES TO TOTAL ASSETS 29.07% 32.91%
---------------------------------------------------------------------------------------------------------------------------
p12 TOTAL LIABILITIES TO STOCKHOLDERS' EQUITY 0.41 times 0.49 times
---------------------------------------------------------------------------------------------------------------------------
p13 FOREIGN CURRENCY LIABILITIES TO TOTAL LIABILITIES 22.02% 19.45%
---------------------------------------------------------------------------------------------------------------------------
p14 LONG-TERM LIABILITIES TO FIXED ASSETS 0.00% 0.00%
---------------------------------------------------------------------------------------------------------------------------
p15 OPERATING INCOME TO INTEREST PAID 25.20 times 174.87 times
---------------------------------------------------------------------------------------------------------------------------
p16 NET SALES TO TOTAL LIABILITIES (**) 3.07 times 2.96 times
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
LIQUIDITY
---------------------------------------------------------------------------------------------------------------------------
p17 CURRENT ASSETS TO CURRENT LIABILITIES 2.91 times 2.09 times
---------------------------------------------------------------------------------------------------------------------------
p18 CURRENT ASSETS LESS INVENTORY TO CURRENT LIABILITIES 1.10 times 0.99 times
---------------------------------------------------------------------------------------------------------------------------
p19 CURRENT ASSETS TO TOTAL LIABILITIES 1.48 times 1.32 times
---------------------------------------------------------------------------------------------------------------------------
p20 AVAILABLE ASSETS TO CURRENT LIABILITIES 28.65% 11.23%
---------------------------------------------------------------------------------------------------------------------------
(**) IN THESE RATIOS FOR THE DATA TAKE INTO CONSIDERATION THE LAST TWELVE MONTHS
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
DIRECTOR REPORT
CONSOLIDATED
Six-Month Period Ended June 30, 2009 compared to Six-Month Period Ended June 30,
2008
Net Sales
Net sales decreased 46% to Ps. 9,242 million in the six-month period ended June
30, 2009 (including the net sales generated by the newly acquired plants of
Grupo San of Ps. 1,899 million) compared to Ps. 17,035 million in the same
period 2008 (including the net sales generated by the newly acquired plants of
Grupo San of Ps. 513 million). Shipments of finished steel products decreased
37% to 977 thousand tons in the six-month period ended June 30, 2009 (including
the net sales generated by the newly acquired plants of Grupo San of 252
thousand tons) compared to 1,562 thousand tons in the same period 2008
(including the net sales generated by the newly acquired plants of Grupo San of
44 thousand tons). Total sales outside of Mexico in the six-month period ended
June 30, 2009 decreased 69% to Ps. 3,760 million (including the net sales
generated by the newly acquired plants of Grupo San of Ps. 6 million) compared
with Ps. 12,172 million in the same period 2008, (including the net sales
generated by the newly acquired plants of Grupo San of Ps. 37 million) while
total Mexican sales increased 13% from Ps. 4,863 million in the six-month period
ended June 30, 2008 (including the net sales generated by the newly acquired
plants of Grupo San of Ps. 476 million) to Ps. 5,482 millions in the same period
2009 (including the net sales generated by the newly acquired plants of Grupo
San of Ps. 1,893 million). The decrease in sales is due to lower shipments
during the six-month period ended June 30, 2009, compared to the same period in
2008 (a 585,000 tons decrease). The average price of steel products decreased
13% in the six-month period ended June 30, 2009 compared with the same period of
2008.
Direct Cost of Sales
Direct cost of sales decreased 46% from Ps. 13,744 million in the six-month
period ended June 30, 2008 (including the cost of sales generated by the newly
acquired plants of Grupo San of Ps. 308 million) to Ps. 7,367 million in the
same period 2009 (including the cost of sales generated by the newly acquired
plants of Grupo San of Ps. 1,241 million). Direct cost of sales as a percentage
of net sales represented 80% in the six-month period ended June 30, 2009
compared to 81% in the same period 2008. The average cost of raw materials used
to produce steel products decreased 14% in the six-month period ended June 30,
2009 versus the same period 2008, primarily as a result of decreases in the
price of scrap and certain other raw materials.
Marginal Profit
Marginal profit in the six-month period ended June 30, 2009 was Ps. 1,875
million (including the marginal profit generated by the newly acquired plants of
Grupo San of Ps. 257 million) compared to Ps. 3,291 million in the same period
2008 (including the marginal profit generated by the newly acquired plants of
Grupo San of Ps. 205 million). Marginal profit as a percentage of net sales in
the six-month period ended June 30, 2009 was 20% compared to 19% in the same
period 2008. The decline in marginal profit is due to lower shipments of 37%
during the six-month period ended June 30, 2009 compared with the same period of
2008.
Operating Expenses
Operating expenses increased 42% to Ps. 1,128 million in the six-month period
ended June 30, 2009 (including the operating expenses from the newly acquired
plants of Grupo San of Ps. 222 million and the amortization of the tangible and
intangible assets of Ps. 179 million registered by the acquisition of Grupo San)
compared to Ps. 794 million in the same period 2008 (including the operating
expenses from the newly acquired plants of Grupo
San of Ps. 53 million), and represented 12% of net sales in the six-month period
ended June 30, 2009 and 5% of net sales in the same period 2008.
Operating Income
Operating income decreased 70% to Ps. 747 million for the six-month period ended
June 30, 2009 (including the operating income generated by the newly acquired
plants of Grupo San of Ps. 257 million) compared to Ps. 2,497 million in the
same period 2008 (including the operating income generated by the newly acquired
plants of Grupo San of Ps. 152 million). Operating income as a percentage of
net sales was 8% in the six-month period ended June 30, 2009 compared to 15% in
the same period 2008. The decline in operating income is due to lower shipments
of 37% during the six-month period ended June 30, 2009 compared with the same
period of 2008.
Comprehensive Financial Cost
Comprehensive financial cost in the six-month period ended June 30, 2009
represented an expense of Ps. 61 million compared with an expense of Ps. 258
million in the same period 2008. Net interest expense was Ps. 12 million in the
six-month period ended June 30, 2009 compared with a net interest income of Ps.
93 million in the same period 2008. At the same time, we registered an exchange
loss of Ps. 49 million in the six-month period ended June 30, 2009 compared with
an exchange loss of Ps. 351 million in the same period 2008, reflecting a 2.5%
increase in the value of the peso versus the dollar in the six-month period
ended June 30, 2009 compared to the same period of 2008.
Other Expenses (Income) net
The company recorded other income net of Ps. 0 million in the six-month period
ended June 30, 2009 compared to other income net of Ps. 4 million in the same
period 2008.
Income Taxes
Income Taxes recorded a provision of Ps. 161 million in the six-month period
ended June 30, 2009 (including the provision of Ps. 105 million of deferred
income taxes) compared to Ps. 726 million in the same period of 2008 (including
the provision of Ps. 342 million of deferred income taxes).
Net Income
As a result of the foregoing, net income decreased by 65% to Ps. 525 million in
the six-month period ended June 30, 2009 from Ps. 1,517 million in the same
period 2008.
Liquidity and Capital Resources
As of June 30, 2009, Simec's total consolidated debt consisted of U.S.
$2,602,000; U.S. $2,300,000 is a credit bank and U.S. $302,000 of 8 7/8%
medium-term notes ("MTN's") due 1998 (accrued interest on June 30, 2009 was U.S.
$404,455). As of December 31, 2008, Simec's total consolidated debt consisted of
U.S. $952,000; U.S. $650,000 is a credit bank and U.S. $302,000 of 8 7/8%
medium-term notes ("MTN's") due 1998 (accrued interest on December 31, 2008 was
U.S. $387,882).
Comparative second quarter 2009 vs first quarter 2009
Net Sales
Net sales decreased 18% from Ps. 5,081 million for the first quarter 2009 to Ps.
4,161 million for the second quarter 2009. Sales in tons of finished steel
decreased 7% to 471 thousand tons in the second quarter 2009 compared with 506
thousand tons in the first quarter 2009. The total sales outside of Mexico for
the second quarter 2009 decreased 31% to Ps. 1,538 million compared with Ps.
2,222 million for the first quarter 2009. Total Mexican sales decreased 8% to
2,623 million in the second quarter 2009 from Ps. 2,859 million in the first
quarter 2009. Prices of finished products sold in the second quarter 2009
decreased approximately 12% compared to the first quarter 2009.
Direct Cost of Sales
Direct cost of sales decreased 21% from Ps. 4,111 million in the first quarter
2009 to Ps. 3,256 million for the second quarter 2009. With respect to sales, in
the second quarter 2009, the direct cost of sales represents 78% compared to 81%
for the first quarter 2009. The average cost of raw materials used to produce
steel products decreased 14% in the second quarter 2009 versus the first quarter
2009, primarily as a result of decreases in the price of scrap and certain other
raw materials.
Marginal Profit
Marginal profit for the second quarter 2009 decreased 7% to Ps. 905 million
compared to Ps. 970 million in the first quarter 2009. The marginal profit as a
percentage of net sales for the second quarter 2009 was 21% compared with 19%
for the first quarter of 2009. The decline in marginal profit is due to lower
shipments of 7% during the second quarter 2009 compared with the first quarter
2009.
Operating Expenses
Operating expenses decreased 7% to Ps. 543 million in the second quarter 2009
compared to Ps. 585 million for the first quarter 2009. Operating expenses as a
percentage of net sales represented 13% during the second quarter 2009 and 12%
during the second quarter 2008.
Operating Income
Operating income decreased 6% from an operating income of Ps. 385 million in the
first quarter 2009 to Ps. 362 million of operating incomet for the second
quarter 2009. The operating income as a percentage of net sales in the second
quarter 2009 was 7% compared to 8% in the first quarter 2009. The decrease in
operating income is due to lower shipments of 7% during the second quarter 2009
compared with the first quarter 2009.
Comprehensive Financial Cost
Comprehensive financial cost for the second quarter 2009 represented an expense
of Ps. 121 million compared with an income of Ps. 60 million for the first
quarter 2009. Net interest expense was Ps. 8 million in the second quarter 2009
compared with Ps. 3 million of net interest expense in the first quarter 2009.
At the same time we registered an exchange loss of Ps. 113 million in the second
quarter 2009 compared with an exchange gain of Ps. 63 million in the first
quarter 2009.
Other Expenses (Income) net
The company recorded other expenses net of Ps. 1 million in the second quarter
2009 compared with other income net of Ps. 2 million for the first quarter 2009.
Income Taxes
Income Taxes for the second quarter 2009 was an expense of Ps. 154 million
compared to Ps. 7 million of expense for the first quarter 2009.
Net Income
As a result of the foregoing, net income was Ps. 86 million in the second
quarter 2009 compared to Ps. 440 million of net income in the first quarter
2009.
Comparative second quarter 2009 vs second quarter 2008
Net Sales
Net sales decreased 57% from Ps. 9,746 million for the second quarter 2008
(including the net sales generated by the newly acquired plants of Grupo San of
Ps. 513 million) to Ps. 4,161 million for the second quarter 2009 (including the
net sales generated by the newly acquired plants of Grupo San of Ps. 840
million). Sales in tons of finished steel decreased 42% to 471 thousand tons in
the second quarter 2009 compared with 817 thousand tons in the second quarter
2008. The total sales outside of Mexico for the second quarter 2009 decreased
77% to Ps. 1,538 million compared with Ps. 6,749 million for the second quarter
2008. Total Mexican sales decreased 12% to 2,623 million in the second quarter
2009 from Ps. 2,997 million in the second quarter 2008. Prices of finished
products sold in the second quarter 2009 decreased approximately 26% compared to
the second quarter 2008.
Direct Cost of Sales
Direct cost of sales decreased 58% from Ps. 7,693 million in the second quarter
2008 (including the cost of sales generated by the newly acquired plants of
Grupo San of Ps. 308 million) to Ps. 3,256 million for the second quarter 2009
(including the cost of sales generated by the newly acquired plants of Grupo San
of Ps. 584 million). With respect to sales, in the second quarter 2009, the
direct cost of sales represents 78% compared to 79% for the second quarter 2008.
The average cost of raw materials used to produce steel products decreased 25%
in the second quarter 2009 versus the second quarter 2008, primarily as a result
of decreases in the price of scrap and certain other raw materials.
Marginal Profit
Marginal profit for the second quarter 2009 decreased 56% to Ps. 905 million
(including the marginal profit generated by the newly acquired plants of Grupo
San of Ps. 256 million) compared to Ps. 2,053 million in the second quarter 2008
(including the marginal profit generated by the newly acquired plants of Grupo
San of Ps. 205 million). The marginal profit as a percentage of net sales for
the second quarter 2009 was 21% compared with 21% for the second quarter 2008.
The decline in marginal profit is due to lower shipments of 42% during the
second quarter 2009 compared with the second quarter 2008.
Operating Expenses
Operating expenses increased 25% to Ps. 543 million in the second quarter 2009
compared to Ps. 434 million for the second quarter 2008. Operating expenses as a
percentage of net sales represented 13% during the second quarter 2009 and 4%
during the second quarter 2008.
Operating Income
Operating income decreased 78% from an operating income of Ps. 1,619 million in
the second quarter 2008 (including the operating income generated by the newly
acquired plants of Grupo San of Ps. 152 million) to Ps. 362 million of operating
income for the second quarter 2009 (including the operating loss generated by
the newly acquired plants of Grupo San of Ps. 32 million). The operating income
as a percentage of net sales in the second quarter 2009 was 7% compared to 17%
in the second quarter 2008. The decrease in operating income is due to lower
shipments of 42% during the second quarter 2009 compared with the second quarter
2008.
Comprehensive Financial Cost
Comprehensive financial cost for the second quarter 2009 represented an expense
of Ps. 121 million compared with an expense of Ps. 197 million for the second
quarter 2008. Net interest expense was Ps. 8 million in the second quarter 2009
compared with Ps. 37 million of net interest income in the second quarter 2008.
At the same time we registered an exchange loss of Ps. 113 million in the second
quarter 2009 compared with an exchange loss of Ps. 234 million in the second
quarter 2008.
Other Expenses (Income) net
The company recorded other expenses net of Ps. 1 million in the second quarter
2009 compared with other expense net of Ps. 2 million for the second quarter
2008.
Income Taxes
Income Taxes for the second quarter 2009 was an expense of Ps. 154 million
compared to Ps. 495 million of income for the second quarter 2008.
Net Income
As a result of the foregoing, net income was Ps. 86 million in the second
quarter 2009 compared to Ps. 925 million of net income in the second quarter
2008.
------------------------------------------------------------------------------
Millions of pesos Six months ended June Six months 2009
30, 2009 ended June 30, vs.
2008 2008
------------------------------------------------------------------------------
Sales 9,242 17,035 (46%)
------------------------------------------------------------------------------
Cost of Sales 7,367 13,744 (46%)
------------------------------------------------------------------------------
Marginal Profit 1,875 3,291 (43%)
------------------------------------------------------------------------------
Operating Expenses 1,128 794 42%
------------------------------------------------------------------------------
Operating Income 747 2,497 (70%)
------------------------------------------------------------------------------
EBITDA 1,292 2,763 (53%)
------------------------------------------------------------------------------
Net Profit 525 1,517 (65%)
------------------------------------------------------------------------------
Sales outside Mexico 3,760 12,172 (69%)
------------------------------------------------------------------------------
Sales in Mexico 5,482 4,863 13%
------------------------------------------------------------------------------
Total sales (tons) 977 1,562 (37%)
------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Millions of pesos) 2Q'09 vs 2Q'09 vs
2Q'09 1Q'09 2Q'08 1Q'09 2Q'08
--------------------------------------------------------------------------------
Sales 4,161 5,081 9,746 (18%) (57%)
--------------------------------------------------------------------------------
Cost of Sales 3,256 4,111 7,693 (21%) (58%)
--------------------------------------------------------------------------------
Marginal Profit 905 970 2,053 (7%) (56%)
--------------------------------------------------------------------------------
Operating Expenses 543 585 434 (7%) 25%
--------------------------------------------------------------------------------
Operating Income 362 385 1,619 (6%) (78%)
--------------------------------------------------------------------------------
EBITDA 632 660 1,755 (4%) (64%)
--------------------------------------------------------------------------------
Net Profit 86 440 925 (80%) (91%)
--------------------------------------------------------------------------------
Sales outside Mexico 1,538 2,222 6,749 (31%) (77%)
--------------------------------------------------------------------------------
Sales in Mexico 2,623 2,859 2,997 (8%) (12%)
--------------------------------------------------------------------------------
Total sales (tons) 471 506 817 (7%) (42%)
--------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------
Thousands of Million Average Thousands of Million of Average
tons six of pesos price per tons six pesos six price per
months ended six ton six months ended months ton six
June 30,2009 months months June 30,2008 ended June months
ended June ended June 30, 2008 ended June
Product 30, 2009 30, 2009 30, 2008
----------------------------------------------------------------------------------------------------
SBQ 416 4,641 11,156 1,144 12,873 11,253
----------------------------------------------------------------------------------------------------
Light Structural 80 773 9,663 101 966 9,564
----------------------------------------------------------------------------------------------------
Structural 95 959 10,095 110 1,120 10,182
----------------------------------------------------------------------------------------------------
Rebar 328 2,377 7,247 194 1,875 9,665
----------------------------------------------------------------------------------------------------
Others 58 492 - 13 201 -
----------------------------------------------------------------------------------------------------
Total 977 9,242 9,460 1,562 17,035 10,906
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
Average Average
Thousands Millions price Thousands Millions Average Thousands Millions price
of tons of pesos per ton of tons of pesos price per of tons of pesos per ton
Product 2Q'09 2Q'09 2Q'09 1Q'09 1Q'09 ton 1Q'09 2Q'08 2Q'08 2Q'08
----------------------------------------------------------------------------------------------------------------------
SBQ 201 2,020 10,050 215 2,621 12,191 579 7,124 12,304
----------------------------------------------------------------------------------------------------------------------
Light Structural 33 308 9,333 47 464 9,872 47 512 10,894
----------------------------------------------------------------------------------------------------------------------
Structural 45 452 10,044 50 507 10,140 55 616 11,200
----------------------------------------------------------------------------------------------------------------------
Rebar 165 1,136 6,885 163 1,241 7,613 124 1,325 10,685
----------------------------------------------------------------------------------------------------------------------
Others 27 245 - 31 248 - 12 169 -
----------------------------------------------------------------------------------------------------------------------
Total 471 4,161 8,834 506 5,081 10,042 817 9,746 11,929
----------------------------------------------------------------------------------------------------------------------
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.
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
FINANCIAL STATEMENT NOTES
CONSOLIDATED
(1) Operations preparation bases and summary of significant accounting policies:
Grupo Simec, S.A. de C.V. and its Subsidiaries ("the Company") are subsidiaries
of Industrias CH, S.A. de C.V. ("ICH"), and their main activities consist of the
manufacturing and sale of steel products primarily destined for the construction
sector of Mexico and other countries.
Significant accounting policies and practices followed by the Companies which
affect the principal captions of the financial statements are described below:
a. Financial statement presentation - Below is a summary of the most significant
accounting policies and practices used in the preparation of the consolidated
financial statements, in conformity with Mexican Financial Reporting Standards
(MFRS), which include Bulletins and Circulars issued by the Accounting
Principles Commission (CPC) of the Mexican Institute of Public Accountants
(IMCP) which have not been amended, replaced or abrogated by MFRS issued by the
Mexican Financial Reporting Standards Research and Development Board (Consejo
Mexicano para la Investigacion y Desarrollo de Normas de Informacion Financiera,
A.C. (CINIF)..
b. Principles of Consolidation - As part of the financial debt restructuring
agreement into during 1997, Compania Siderurgica de Guadalajara, S.A. de C.V.
("CSG") assumed all of the debt of the Company in return for an equity interest
in its subsidiaries. As a result of the above, the Company is the principal
shareholder of CSG, and CSG is the principal shareholder of the other
subsidiaries that Grupo Simec, S.A. de C.V. ("Simec") controlled before the
restructuring.
The main subsidiaries of CSG are the following:
o Simec International, S.A. de C.V.
o Industrias del Acero y del Alambre, S.A. de C.V.
o Pacific Steel Inc.
o SimRep Corporation and PAV Republic and Subsidiaries
o Corporacion Aceros DM, S.A. de C.V. and Subsidiaries
All significant intercompany balances and transactions have been eliminated in
consolidation.
c. Cash and cash equivalents - The Company considers short-term investments with
original maturities not greater than three months to be cash equivalent. Cash
equivalents include temporary investments and Mexican Government Treasury Bonds,
and are stated at market value, which approximates cost plus earned interest.
Any increase in market value is credited to operations for the period.
d. Inventories - Domestic subsidiaries' inventories are recorded initially at
average cost under the direct costing system. Foreign subsidiaries' inventories
are valued on a last-in, first-out (LIFO). For translation effects into MFRS the
inventories have been adjusted from LIFO to average cost under the direct
costing system.
Billet finished goods and work in process, raw materials and materials, supplies
and rollers - At the average cost.
The Company presents as non-current inventories the rollers and spare parts,
which according to historical data and production trends will not be used within
a one-year period.
e.- Derivative financial instruments-- During 2008, 2007 and 2006 the Company
used derivative financial instruments for hedging risks associated with natural
gas prices for which it conducted studies on historical consumption, future
requirement and commitments acquired, thus diminishing its exposure to risks
other than its normal operating risks.
To mitigate the risks associated with changes in natural gas prices occurring
naturally as a result of the supply and demand on international markets, the
Company uses natural gas cash-flow exchange contracts or natural gas swaps to
offset fluctuations in the price of natural gas, whereby the Company receives a
floating price and pays a fixed price. Fluctuations in natural gas prices from
volumes consumed are recognized as part of the Company's operating cost.
The fair value of these assets or liabilities is restated at the end of each
month based on the new estimate. The Company periodically evaluates the changes
in cash flows of the derivative instrument to analyze if the swaps are highly
effective for mitigating the exposure to natural gas price fluctuations. A hedge
instrument is considered to be highly effective when changes in its fair value
or cash flows of the primary position are compensated on a regular or
cumulatively basis, by changes in fair value or cash flows of the hedging
instrument in a range between 80% and 125%. In 2008, 2007 and 2006 the fair
value of derivatives that did not qualify for hedge accounting was adjusted
through Statement of Income. For the derivatives that qualified for hedge
accounting their fair value was adjusted through the Stockholders' equity in the
caption Fair value of derivative financial instruments until such time as the
related item the derivative hedges is recognized in income. At that time, the
fair value included in Stockholders' equity is also recognized in income. The
Company is using derivative financial instruments for hedging risks associated
with natural gas prices and conducted studies on historical consumption, future
requirements and commitments; thus it avoided exposure to risks other than the
normal operating risks. Management of the Company examines its financial risks
by continually analyzing price, credit and liquidity risks.
f. Property, plant and equipment - Property, plant and equipment of domestic
origin are restated by using factors derived from The National Consumer Price
Index ("NCPI") from the date of their acquisition, and imported machinery and
equipment are restated by applying devaluation and inflation factors of the
country of origin, until December 31, 2007. Depreciation recorded in the
consolidated statement of income (loss) is computed based upon the estimated
useful life and the restated cost of each asset. In addition, Financial expense
incurred during the construction period is capitalized as construction in
progress. The estimated useful lives of assets as of June 30, 2009 are as
follows:
Years
-----
Buildings................................................... 15 to 50
Machinery and equipment .................................... 10 to 40
Buildings and improvements (Republic)....................... 10 to 25
Land improvements (Republic)................................ 5 to 25
Machinery and equipment (Republic).......................... 5 to 20
g. Other assets - Organization and pre-operating expenses are capitalized and
and their amortization is calculated by the straight-line method over a period
of 20 years.
h. Seniority premiums and severance payments - According to Federal Labor Law,
employees are entitled to seniority premiums after fifteen years or more of
services. These premiums are recognized as expenses in the
years in which the services are rendered, using actuarial calculations based on
the projected unit credit method, and since 1996 by applying real interest and
salary increases.
Any other payments to which employees may be entitled in case of separation,
disability or death, are charged to operations in the period in which they
become payable.
i. Pension plan - Until 1995, the Company provided pension benefits for all
personnel with a minimum of 10 years of service and 35 years of age. The Company
had established an irrevocable trust for its contributions, which were based on
actuarial calculations. In December 1995, the board of directors of the Company,
in agreement with the trade union, discontinued these benefits and related
contributions to the trust fund. This decision was made because of the new
Mexican pension fund system, Administradoras de Fondos para el Retiro, which
establishes similar benefits for the employees. The balance of the trust fund
will be applied to the retirement benefits of qualifying employees until the
fund is exhausted due to the irrevocable status of the fund.
The Company does not have any contractual obligation regarding the payment of
pensions of retirements.
j. Income taxes - In 1999, the Mexican Institute of Public Accountants issued
Bulletin D-4, "Accounting for Income and Asset Taxes and Employee Profit
Sharing", which is effective for all fiscal years beginning January 1, 2000.
Bulletin D-4 establishes financial accounting and reporting standards for the
effects of asset tax, income tax and employee profit sharing that result from
enterprise activities during the current and preceding years.
The Company and its subsidiaries are included in the consolidated tax returns of
the company's parent.
k. Foreign currency transactions and exchange differences - All transactions in
foreign currency are recorded at the exchange rates prevailing on the date of
their execution or liquidation. Foreign currency denominated assets and
liabilities are translated at the exchange rates prevailing at the balance sheet
date. Any exchange differences incurred with regard to assets or liabilities
denominated in foreign currency are charged to operations of the period and are
included in financial income (expense) in the accompanying consolidated
statements of income (loss).
For consolidation purposes, the financial statements of the foreign
subsidiaries, were translated into pesos in conformity with Mexican accounting
Bulletin MFRS B-15, Transactions in Foreign Currency.
The first step in the process of conversion of financial information of the
operations is the determination of the functional currency, which is in first
instance the currency of primary the economic surroundings of the foreign
operation; nevertheless, despite the previous thing, the functional currency can
differ from the premises or registry, in the measurement that this one does not
represent the currency that fundamentally affects the cash flow of the
operations abroad. The financial statements of the foreign subsidiaries were
turned to Mexican pesos with the following procedure:
- Applying the prevailing exchange rate at the consolidated balance date for
monetary assets and liabilities.
- Applying the prevailing historical exchange rate for nonmonetary assets and
liabilities and for stockholders' equity accounts.
- Applying the prevailing the historical exchange rate at the consolidated
balance sheet date for revenues and expenses during the reporting period
- The resulting effect of translation, the process of consolidation and to apply
the participation method, is recorded in stockholders' equity under the
accumulated effect by conversion forming part of the Comprehensive Income.
l. Geographic concentration of credit risk - The Company sells its products
primarily to distributors for the construction industry with no specific
geographic concentration. Additionally, no single customer accounted for a
significant amount of the Company's sales, and there were no significant
accounts receivable from a single customer or affiliate at June 30, 2009 sales
to five customers accounted for approximately 34% of the Republic's sales. The
Company performs evaluations of its customers' credit histories and establishes
and allowance for doubtful accounts based upon the credit risk of specific
customers and historical trends.
m. Other income (expenses) - Other income (expenses) shown in the consolidated
statements of operations primarily includes other financial operations.
(2) Financial Debt:
As of June 30, 2009, Simec's total consolidated debt consisted of U.S.
$2,602,000; U.S. $2,300,000 is a credit bank and U.S. $302,000 of 8 7/8%
medium-term notes ("MTN's") due 1998 (accrued interest on June 30, 2009 was U.S.
$404,455). As of December 31, 2008, Simec's total consolidated debt consisted of
U.S. $952,000; U.S. $650,000 is a credit bank and U.S. $302,000 from 8 7/8%
medium-term notes ("MTN's") due 1998 (accrued interest on December 31, 2008 was
U.S. $387,882).
(3) Commitments and contingent liabilities:
a. Pacific Steel, Inc. (a wholly-owned subsidiary located in the U.S.A.) has
been named in various claims and suits relating to the generation, storage,
transport, disposal and cleanup of materials classified as hazardous waste. The
Company has accrued approximately Ps. 9,031 (U.S. $684,047) at June 30, 2009,
(included in accrued liabilities) relating to these actions; the reduction of
this reserve from previous levels reflects clean-up activities undertaken by
Simec. Management believes the ultimate liability with respect to this matter
will not exceed the amounts that have been accrued.
b. The Company is subject to various other legal proceeding and claims, which
have arisen, in the ordinary course of its business. It is the opinion of
management that their ultimate resolution will not have a material adverse
effect on the Company's consolidated financial position or consolidated results
of operations.
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 1 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
RELATIONS OF SHARES INVESTMENTS
CONSOLIDATED
-----------------------------------------------------------------------------------------------------------------------------
COMPANY NAME MAIN ACTIVITIES NUMBER OF OWNERSHIP
SHARES
-----------------------------------------------------------------------------------------------------------------------------
SUBSIDIARIES
-----------------------------------------------------------------------------------------------------------------------------
Cia Siderurgica de Guadalajara Sub-Holding 99.99
-----------------------------------------------------------------------------------------------------------------------------
Simec International Production and sales of steel 99.99
products
-----------------------------------------------------------------------------------------------------------------------------
Arrendadora Simec Production and sales of steel 100.00
products
-----------------------------------------------------------------------------------------------------------------------------
Controladora Simec Sub-Holding 100.00
-----------------------------------------------------------------------------------------------------------------------------
Pacific Steel Scrap purchase 100.00
-----------------------------------------------------------------------------------------------------------------------------
Cia. Siderurgica del Pacifico Rent of land 99.99
-----------------------------------------------------------------------------------------------------------------------------
Coordinadora de Servicios Siderurgicos de Calidad Administrative services 100.00
-----------------------------------------------------------------------------------------------------------------------------
Comercializadora Simec Sales of steel products 99.99
-----------------------------------------------------------------------------------------------------------------------------
Industrias del Acero y del Alambre Sales of steel products 99.99
-----------------------------------------------------------------------------------------------------------------------------
Procesadora Mexicali Scrap purchase 99.99
-----------------------------------------------------------------------------------------------------------------------------
Servicios Simec Administrative services 100.00
-----------------------------------------------------------------------------------------------------------------------------
Sistemas de Transporte de Baja California Freight services 100.00
-----------------------------------------------------------------------------------------------------------------------------
Operadora de Metales Administrative services 100.00
-----------------------------------------------------------------------------------------------------------------------------
Operadora de Servicios Siderurgicos de Tlaxcala Administrative services 100.00
-----------------------------------------------------------------------------------------------------------------------------
Administradora de Servicios Siderurgicos de Tlaxcala Administrative services 100.00
-----------------------------------------------------------------------------------------------------------------------------
Operadora de Servicios de la Industria Siderurgica Administrative services 100.00
-----------------------------------------------------------------------------------------------------------------------------
SimRep Sub-Holding 50.22
-----------------------------------------------------------------------------------------------------------------------------
PAV Republic Production and sales of steel 50.22
products
-----------------------------------------------------------------------------------------------------------------------------
CSG Comercial Sales of steel products 99.95
-----------------------------------------------------------------------------------------------------------------------------
Comercializadora de Aceros de Tlaxcala Sales of steel products 99.95
-----------------------------------------------------------------------------------------------------------------------------
Siderurgica de Baja California Sales of steel products 99.95
-----------------------------------------------------------------------------------------------------------------------------
Corporacion Aceros DM Sub-Holding 100.00
-----------------------------------------------------------------------------------------------------------------------------
Productos Siderurgicos de Tlaxcala Sales of steel products 100.00
-----------------------------------------------------------------------------------------------------------------------------
Comercializadora MSAN Sales of steel products 100.00
-----------------------------------------------------------------------------------------------------------------------------
Comercializadora Aceros DM Sales of steel products 100.00
-----------------------------------------------------------------------------------------------------------------------------
Promotora de Aceros San Luis Sales of steel products 100.00
-----------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT IN SUBSIDIARIES
-----------------------------------------------------------------------------------------------------------------------------
ASSOCIATEDS
-----------------------------------------------------------------------------------------------------------------------------
0
-----------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT IN ASSOCIATEDS 0
-----------------------------------------------------------------------------------------------------------------------------
OTHER PERMANENT INVESTMENTS 0.00
-----------------------------------------------------------------------------------------------------------------------------
TOTAL 0
-----------------------------------------------------------------------------------------------------------------------------
NOTES
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
CREDITS BREAK DOWN
(THOUSANDS OF MEXICAN PESOS)
CONSOLIDATED
------------------------------------------------------------------------------------------------------------------------------------
Denominated in Pesos Denominated in Foreign Currency
(Thousands of Pesos) (Thousands of Pesos)
------------------------------------------------------------------------------------------------------------------------------------
Credit Type / Amortization Rate of
Institution Date Interest Time Interval Time Interval
------------------------------------------------------------------------------------------------------------------------------------
Current Until Until Until Until Until Current Until Until Until Until Until
Year 1 2 3 4 5 Year 1 2 3 4 5
Year Years Years Years Years Year Years Years Years Years
or More or More
------------------------------------------------------------------------------------------------------------------------------------
BANKS
-----------------------------------------------------------------------------------------------------------------------------------
With Warranty 0 0 0 0 0 0 0 0 0 0 0 0
-----------------------------------------------------------------------------------------------------------------------------------
LIBOR+
GE CAPITAL 20/05/2010 0.25 0 0 0 0 0 0 0 30,365 0 0 0 0
-----------------------------------------------------------------------------------------------------------------------------------
TOTAL BANKS 0 0 0 0 0 0 0 30,365 0 0 0 0
-----------------------------------------------------------------------------------------------------------------------------------
LISTED IN THE
STOCK EXCHANGE
-----------------------------------------------------------------------------------------------------------------------------------
UNSECURED DEBT
-----------------------------------------------------------------------------------------------------------------------------------
Medium Term
Notes 15/12/1998 9.33 0 0 0 0 0 0 3,987 0 0 0 0 0
-----------------------------------------------------------------------------------------------------------------------------------
TOTAL STOCK
EXCHANGE 0 0 0 0 0 0 3,987 0 0 0 0 0
-----------------------------------------------------------------------------------------------------------------------------------
SUPPLIERS
-----------------------------------------------------------------------------------------------------------------------------------
Various 1,099,581 0 0 0 0 0 1,401,718 0 0 0 0 0
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
TOTAL SUPPLIERS 1,099,581 0 0 0 0 0 1,401,718 0 0 0 0 0
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
OTHER LOANS
WITH COST
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
TOTAL 0 0 0 0 0 0 0 0 0 0 0 0
-----------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
OTHER CURRENT
LIABILITIES
WITHOUT COST
------------------------------------------------------------------------------------------------------------------------------------
Various 0 1,156,198 0 0 0 0 0 526,159 0 0 0 0
------------------------------------------------------------------------------------------------------------------------------------
TOTAL 0 1,156,198 0 0 0 0 0 526,159 0 0 0 0
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
TOTAL 1,099,581 1,156,198 0 0 0 0 1,405,705 556,524 0 0 0 0
------------------------------------------------------------------------------------------------------------------------------------
NOTES: The exchange rate of the peso to the U.S. Dollar at June 30, 2009
was Ps. 13.2023
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
MONETARY FOREIGN CURRENCY POSITION
(Thousands of Mexican Pesos)
CONSOLIDATED
------------------------------------------------------------------------------------------------------------------------
DOLLARS OTHER CURRENCIES TOTAL
------------------------------------------------------------------------------------------------------------------------
FOREING CURRENCY POSITION THOUSANDS OF THOUSANDS OF THOUSANDS OF THOUSANDS OF THOUSANDS OF
DOLLARS PESOS DOLLARS PESOS PESOS
------------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS 173,548 2,291,215 1 15 2,291,230
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
LIABILITIES POSITION 148,503 1,960,565 126 1,664 1,962,229
------------------------------------------------------------------------------------------------------------------------
SHORT TERM LIABILITIES POSITION 148,503 1,960,565 126 1,664 1,962,229
------------------------------------------------------------------------------------------------------------------------
LONG TERM LIABILITIES POSITION 0 0 0 0 0
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
NET BALANCE 25,045 330,650 (125) (1,649) 329,001
------------------------------------------------------------------------------------------------------------------------
NOTES
THE EXCHANGE RATE OF THE PESO TO THE U.S. DOLLAR AT JUNE 30, 2009
WAS PS. 13.2023
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER:2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
DEBT INSTRUMENTS
CONSOLIDATED
FINANCIAL LIMITED BASED IN ISSUED DEED AND/OR TITLE
MEDIUM TERM NOTES
A) Current assets to current liabilities must be 1.0 times or more.
B) Total liabilities to total assets do not be more than 0.60.
C) Operating income plus items added to income which do not require
using cash must be 2.0 times or more.
This notes was offered in the international market.
ACTUAL SITUATION OF FINANCIAL LIMITED
MEDIUM TERM NOTES
A) Accomplished the actual situation is 2.91 times.
B) Accomplished the actual situation is 0.29
C) Accomplished the actual situation is 41.87
As of June 30, 2009, the remaining balance of the MTNs not exchanged
amounts to Ps. 3,987 ($302,000 dollars).
C.P. Jose Flores Flores
Chief Financial Officer
BONDS AND/OR MEDIUM TERM NOTES CERTIFICATE
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
PLANTS, COMMERCE CENTERS OR DISTRIBUTION CENTERS
CONSOLIDATED
-----------------------------------------------------------------------------------------------------------------------
PLANT OR CENTER ECONOMIC ACTIVITY PLANT CAPACITY UTILIZATION (%)
-----------------------------------------------------------------------------------------------------------------------
GUADALAJARA MINI MILL PRODUCTION AND SALES OF STEEL PRODUCTS 480 78.68
-----------------------------------------------------------------------------------------------------------------------
MEXICALI MINI MILL PRODUCTION AND SALES OF STEEL PRODUCTS 250 72.42
-----------------------------------------------------------------------------------------------------------------------
INDUSTRIAS DEL ACERO Y DEL ALAMBRE SALE OF STEEL PRODUCTS 0 0.00
-----------------------------------------------------------------------------------------------------------------------
APIZACO AND CHOLULA PLANTS PRODUCTION AND SALES OF STEEL PRODUCTS 460 78.27
-----------------------------------------------------------------------------------------------------------------------
CANTON CASTER FACILITY PRODUCTION OF BILLET 1,380 29.70
-----------------------------------------------------------------------------------------------------------------------
LORAIN CASTER FACILITY PRODUCTION OF BILLET 1,150 0.00
-----------------------------------------------------------------------------------------------------------------------
LORAIN HOT-ROLLING MILL PRODUCTION AND SALES OF STEEL PRODUCTS 840 25.30
-----------------------------------------------------------------------------------------------------------------------
LACKAWANNA HOT-ROLLING MILL PRODUCTION AND SALES OF STEEL PRODUCTS 600 37.70
-----------------------------------------------------------------------------------------------------------------------
MASSILLON COLD-FINISH FACILITY PRODUCTION AND SALES OF STEEL PRODUCTS 125 41.00
-----------------------------------------------------------------------------------------------------------------------
GARY COLD-FINISH FACILITY PRODUCTION AND SALES OF STEEL PRODUCTS 70 21.30
-----------------------------------------------------------------------------------------------------------------------
ONTARIO COLD-FINISH FACILITY PRODUCTION AND SALES OF STEEL PRODUCTS 60 43.40
-----------------------------------------------------------------------------------------------------------------------
SAN LUIS POTOSI COLD-FINISH FACILITY PRODUCTION AND SALES OF STEEL PRODUCTS 600 82.51
-----------------------------------------------------------------------------------------------------------------------
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
MAIN RAW MATERIALS
CONSOLIDATED
-----------------------------------------------------------------------------------------------------------------------------
DOMESTIC COST PRODUCTION (%)
DOMESTIC MAIN SUPPLIERS FOREIGN MAIN SUPPLIERS SUBSTITUTION
-----------------------------------------------------------------------------------------------------------------------------
PLANTS IN USA SCRAP VARIOUS NO 22.30
-----------------------------------------------------------------------------------------------------------------------------
SCRAP VARIOUS PLANTS IN MEXICO 60.00
-----------------------------------------------------------------------------------------------------------------------------
FERROALLOYS VARIOUS PLANTS IN MEXICO YES 7.37
-----------------------------------------------------------------------------------------------------------------------------
PLANTS IN USA FERROALLOYS VARIOUS NO 12.40
-----------------------------------------------------------------------------------------------------------------------------
ELECTRODES VARIOUS PLANTS IN MEXICO VARIOUS YES 2.27
-----------------------------------------------------------------------------------------------------------------------------
PLANTS IN USA ELECTRODES VARIOUS NO 2.40
-----------------------------------------------------------------------------------------------------------------------------
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER:2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
SELLS DISTRIBUTION BY PRODUCT
CONSOLIDATED
DOMESTIC SELLS
--------------------------------------------------------------------------------
MAIN PRODUCTS NET SALES MAIN DESTINATION
--------------------------------------------------------------------------------
VOLUME AMOUNT TRADEMARKS COSTUMERS
--------------------------------------------------------------------------------
STRUCTURAL PROFILES 82 842,475
--------------------------------------------------------------------------------
COMMERCIAL PROFILES 34 325,540
--------------------------------------------------------------------------------
REBAR 323 2,343,215
--------------------------------------------------------------------------------
FLAT BAR 23 228,003
--------------------------------------------------------------------------------
STEEL BARS 141 1,250,646
--------------------------------------------------------------------------------
OTHER 0 69,098
--------------------------------------------------------------------------------
BILLET 15 84,592
--------------------------------------------------------------------------------
ALAMBRON 18 132,732
--------------------------------------------------------------------------------
MALLA 25 205,617
--------------------------------------------------------------------------------
T O T A L 2,859,092
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
FOREIGN SALES 3,760,147
--------------------------------------------------------------------------------
TOTAL 9,242,065
--------------------------------------------------------------------------------
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER:2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
SELLS DISTRIBUTION BY PRODUCT
CONSOLIDATED
FOREIGN SELLS
--------------------------------------------------------------------------------
MAIN PRODUCTS NET SALES MAIN DESTINATION
--------------------------------------------------------------------------------
VOLUME AMOUNT TRADEMARKS COSTUMERS
--------------------------------------------------------------------------------
EXPORTS
--------------------------------------------------------------------------------
STRUCTURAL PROFILES 13 116,871
--------------------------------------------------------------------------------
COMMERCIAL PROFILES 14 132,297
--------------------------------------------------------------------------------
STEEL BARS 14 143,776
--------------------------------------------------------------------------------
REBAR 5 33,437
--------------------------------------------------------------------------------
FLAT BAR 9 86,853
--------------------------------------------------------------------------------
BILLET 0 333
--------------------------------------------------------------------------------
FOREIGN SUBSIDIARIES
--------------------------------------------------------------------------------
HOT-ROLLED BARS 181 2,183,169
--------------------------------------------------------------------------------
COLD-FINISHED BARS 41 671,977
--------------------------------------------------------------------------------
SEMI-FINISHED SEAMLESS
TUBE ROUNDS 4 27,585
--------------------------------------------------------------------------------
OTHER SEMI-FINISHED
TRADE PRODUCTS 23 234,580
--------------------------------------------------------------------------------
INGOT 12 129,269
--------------------------------------------------------------------------------
T O T A L 3,760,147
--------------------------------------------------------------------------------
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER:2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
CONSTRUCTION IN PROGRESS
CONSOLIDATED
THE PROJECTS IN PROGRESS AT JUNE 30, 2009, ARE:
PROJECTS IN PROGRESS TOTAL INVESTMENT
PROJECTS IN 206,748
REPUBLIC
PROJECTS IN MEXICALI 166,909
PROJECTS IN TLAXCALA 70,545
PROJECTS IN GUADALAJARA 16,670
PROJECTS IN SAN LUIS POTOSI 19,047
TOTAL INVESTMENT AT
JUNE 30, 2009 479,919
=======
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER:2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
TRANSACTIONS IN FOREIGN CURRENCY AND CONVERSION OF FINANCIAL STATEMENTS
OF FOREIGN OPERATIONS INFORMATION RELATED TO BULLETIN B-15
CONSOLIDATED
Foreign currency transactions and exchange differences - All transactions in
foreign currency are recorded at the exchange rates prevailing on the date of
their execution or liquidation. Foreign currency denominated assets and
liabilities are translated at the exchange rates prevailing at the balance sheet
date. Any exchange differences incurred with regard to assets or liabilities
denominated in foreign currency are charged to operations of the period and are
included in financial income (expense) in the accompanying consolidated
statements of income (loss).
For consolidation purposes, the financial statements of the foreign
subsidiaries, were translated into pesos in conformity with Mexican accounting
Bulletin MFRS B-15, Transactions in Foreign Currency.
The first step in the process of conversion of financial information of the
operations is the determination of the functional currency, which is in first
instance the currency of primary the economic surroundings of the foreign
operation; nevertheless, despite the previous thing, the functional currency can
differ from the premises or registry, in the measurement that this one does not
represent the currency that fundamentally affects the cash flow of the
operations abroad. The financial statements of the foreign subsidiaries were
turned to Mexican pesos with the following procedure:
- Applying the prevailing exchange rate at the consolidated balance date for
assets and liabilities.
- Applying the prevailing historical exchange rate for stockholders' equity
accounts.
- Applying the prevailing the historical exchange rate at the consolidated
balance sheet date for revenues and expenses during the reporting period
- The resulting effect of translation, the process of consolidation and to apply
the participation method, is recorded in stockholders' equity under the
accumulated effect by conversion forming part of the Comprehensive Income.
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER:2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
CONSOLIDATED
INTEGRATION OF THE PAID SOCIAL CAPITAL STOCK
CHARACTERISTICS OF THE SHARES
-------------------------------------------------------------------------------------------------------------------------
SERIES NOMINAL VALID NUMBER OF SHARES CAPITAL STOCK
VALUE CUPON (Thousands of Pesos)
-------------------------------------------------------------------------------------------------------------------------
FIXED VARIABLE FREE
PORTION PORTION MEXICAN SUSCRIPTION FIXED VARIABLE
-------------------------------------------------------------------------------------------------------------------------
B 90,850,050 406,859,164 0 497,709,214 441,786 1,978,444
-------------------------------------------------------------------------------------------------------------------------
TOTAL 90,850,050 406,859,164 0 497,709,214 441,786 1,978,444
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------
TOTAL NUMBER OF SHARES REPRESENTING THE PAID-IN CAPITAL STOCK ON THE DATE OF SENDING THE INFORMATION: 497,709,214
-------------------------------------------------------------------------------------------------------------------------
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER: 2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
CONSOLIDATED
R20: PRO FORMA FINANCIAL INFORMATION
The following combined pro forma financial information (unaudited) is
based on the Company's historical financial statements, adjusted to
include the effects of the acquisition of Grupo San.
The pro forma information (unaudited) assumes that the acquisition was
conducted at the beginning of 2008, and is based on the available
information and certain assumptions that management considered
reasonable.
The pro forma financial information (unaudited) is not intended to
present the results of the consolidated operations had the acquisition
occurred on such date, nor to anticipate the Company's results of
operations.
January- January-
June June
2009 2008
------------- --------------
2009 2008
------------- --------------
Net sales Ps. 9,242 Ps. 19,779
Marginal profit 1,824 4,404
Net income Ps. 822 Ps. 1,784
------------- --------------
Earnings per share 1.65 4.72
============= ==============
MEXICAN STOCK EXCHANGE
SIFIC / ICS
STOCK EXCHANGE CODE: SIMEC QUARTER:2 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.
CONSOLIDATED
DECLARATION OF THE COMPANY OFFICIALS RESPONSIBLE FOR THE
INFORMATION CONTAINED IN THIS REPORT.
LUIS GARCIA LIMON AND JOSE FLORES FLORES CERTIFY THAT BASED ON OUR KNOWLEDGE,
THIS REPORT DOES NOT CONTAIN ANY UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT TO
STATE A MATERIAL FACT NECESSARY TO MAKE THE STATEMENTS MADE HEREIN, IN LIGHT OF
THE CIRCUMSTANCES UNDER WHICH SUCH STATEMENTS WERE MADE, NOT MISLEADING WITH
RESPECT TO THE PERIOD COVERED BY THIS SECOND QUARTER REPORT.
ING LUIS GARCIA LIMON C.P. JOSE FLORES FLORES
CHIEF EXECUTIVE OFFICER CHIEF FINANCIAL OFFICER
GUADALAJARA, JAL, AT JULY 24 OF 2009.