Ternium SA (NYSE: TX) reported Q1 EPS of $1.33, $0.64 better than the analyst estimate of $0.69. Revenue for the quarter came in at $2.04 billion versus the consensus estimate of $1.89 billion.

Outlook

After a 9% sequential increase in steel shipments in Mexico in the first quarter 2017, Ternium anticipates further growth in shipments during the second quarter of the year, driven mainly by healthy industrial customer demand, especially in the automotive and household appliances industries. A restocking in the construction-related value chain will also contribute to this expected increase in shipments. The company anticipates sequential and year-over-year increases in shipments in Argentina in the second quarter 2017, supported primarily by agroindustry and public infrastructure investment.

Ternium expects to maintain in the second quarter 2017 its strong operating income level of the first quarter, with higher shipments and a slightly lower operating margin. Cost per ton will sequentially increase, principally as a result of the pass-through to the company's cost of sales of higher slab and coal prices. On the other side, higher revenue per ton will partially offset this increase in costs, mainly due to higher realized prices in Mexico in connection with the usual lag effect of regular price resets contained in industrial customer sales contracts.

For earnings history and earnings-related data on Ternium SA (TX) click here.