December 02, 2008

Grupo Simec Q2 profit up by 69% YoY

Mexico based Grupo Simec a manufacturer and distributor of special bar quality steel products announced that its earnings for the second quarter of fiscal 2008 rose by 69% YoY helped by a 55% increase in sales.

Simec’s net profit increased by 69% YoY to MXN 925 million in the second quarter ended June 30th 2008 from MXN 547 million in the second quarter of 2007. Net sales increased 55% to MXN 9.746 billion in the second quarter of fiscal 2008 from MXN 6.287 billion for the second quarter 2007. The results for the second quarter of fiscal 2008 included the net sales generated by the newly acquired plants of Grupo San of MXN 513 million.

Sales in tons of finished steel increased 20% YoY to 817 thousand tonne in the second quarter 2008 from 679 thousand tonne in the same period 2007. Prices of finished products sold in the second quarter 2008 increased about 29% compared to the same period last year.

For the six month period ended June 30th 2008 net profit climbed by 17% YoY to MXN 1.517 billion in from MXN 1.296 billion in the prior year period. Net sales increased 36% YoY to MXN 17.035 billion in the six month period, including the net sales generated by the newly acquired plants of Grupo San of MXN 513 million as compared to MXN 12.557 billion in the same period of 2007.

Simec signed a deal to purchase 100% of the shares of Corporacion Aceros DM SA de CV and certain of its affiliates or Grupo San on February 21st 2008 and the acquisition was consummated on May 30th 2008. The financial statements of Simec include the operations of Grupo San since June 1.

Grupo Simec is a mini mill steel producer that makes an array of non flat structural steel products. The company describes itself as the largest producer of special bar quality steel in North America.