GRUPO SIMEC ANNOUNCES RESULTS OF OPERATIONS FOR THE FIRST QUARTER, OF 2023, ENDED MARCH 31, 2023.

GUADALAJARA, Mexico: Grupo Simec, S.A.B. de C.V. (NYSE: SIM) ("Simec") announced today its results of operations for the three-month period ended March 31, 2023.

Comparative first quarter of 2023 vs. first quarter of 2022

Net Sales

The net sales of the company decreased derived from a less sales price. Sales passed from Ps. 15,032 million in the first quarter of 2022 to Ps. 12,825 million in the same period of 2023. Shipments of steel finished goods decreased 3% from 623 thousand tons in the first quarter of 2022 compared to 604 thousand tons in the same period of 2023. Total sales outside of Mexico in the first quarter of 2023 decreased 26% to reach Ps. 5,181 million compared to Ps. 6,976 million in the same period of 2022. The Mexican sales decreased 5% from Ps. 8,056 million in the first quarter of 2022 to Ps. 7,644 million in the same period of 2023. The decrease in sales can be explained, from the average sales price per ton of steel finished goods decreased 12% in the first quarter of 2023 compared with the same period of 2022.

Cost of Sales

The cost of sales decreased from Ps. 11,190 million in the first quarter of 2022 to Ps. 9,618 million in the same period of 2023. Cost of sales as a percentage of net sales in the first quarter of 2023 and 2022 represented 75% and 74% respectively. The average cost of sales per ton of steel finished goods decreased 11% in the first quarter of 2023 compared to the same period of 2022.

Gross Profit

The gross profit of the company decreased 17% from Ps. 3,842 million in 2022 to Ps. 3,207 million in the same period of 2023. Gross profit as a percentage of net sales in the first quarter of 2023 and 2022 represented 25% and 26% respectively. The decrease in gross profit is due to explained from the average sales price per ton of steel finished goods in the first quarter of 2023 compared with the same period of 2022.

General, Sales and administrative Expenses

General, selling, and administrative expenses increased 13%, from Ps.518 million in the first quarter of 2022 to Ps. 587 million in the same period of 2023 and representing 3% of net sales in 2022 compared to 5% for the period 2023.

Other Expenses (Income) net

The company recorded other income net of Ps. 58 million in the first quarter of 2023 compared to other income net of Ps. 1 million in the same period of 2022.

Operating Income

The operating income decreased from Ps. 3,325 million for the first quarter of 2022 compared to Ps. 2,678 million in the same period of 2023. Operating income as a percentage of net sales was 21% in the first quarter of 2023 compared to 22% in the same period of 2022. The decrease in operating income is from the average sales price per ton of steel finished goods in the first quarter of 2023 compared with the same period of 2022.

EBITDA

The EBITDA of the Company was of Ps. 3,605 million for the first quarter of 2022, as a result of a net income of Ps. 2,494 million, plus income taxes of Ps. 460 million, plus comprehensive financial cost of Ps. 371 million, plus depreciation of Ps. 280 million to Ps 2,959 million in the same period of 2023 as a result of a net income of Ps. 1,033 million, less minority stake of Ps. 2 million plus income taxes of Ps. 531 million, plus comprehensive financial cost of Ps. 1,116 million, plus depreciation of Ps. 281.

Consolidated

Million

Comparative first quarter of...