Sales at Mexico’s Industrias CH (ICH) declined by 8pc in 2019 to MXN37.779bn ($1.915bn) from MXN41.179bn in 2018 despite a 3pc increase in sales volume to 2.598mn mt in 2019 from 2.522mn in the prior year. Sales volumes increased more sharply in Q4 2019 rising by 9pc to 646mn mt compared to 594mn in Q4 2018.
ICH’s special steel division sold 861,000mt of material worth MXN15.488bn, a decline of 1pc in tonnage and 11pc in value compared with 871,000mt worth MXN17.321bn sold in the prior year. Tube volumes sold decreased by 47pc to 43,000mt in 2019 compared to 81,000mt in 2018. The volume of commercial steel sales increased by 8pc from 1.570mn mt in 2018 to 1.694mn mt in 2019, yet they dropped by 2pc in value to MXN21.386bn in 2019 from MXN21.905bn in the previous year.
The company’s Domestic sales decreased by 14pc to MXN20.067bn in 2019 from MXN23.381bn in 2018 with the average domestic prices decreasing by 11pc year-on-year. Export sales decreased by 1pc to MXN17.654bn from MXN17.762bn in 2018. Exports increased as a percentage of total sales comprising 47pc of the share of total sales in 2019 compared with 43pc the prior year. Domestic sales in Q4 2019 decreased by 26pc to MXN3.720bn compared to MXN5.012bn in Q4 2018.
The Mexican steelmaker’s cost of goods sold decreased by 7pc to MXN32.699bn in 2019 from MXN35.043bn in the prior year. The cost of goods sold as a percentage of sales increased by 2 percentage points to 87pc in 2019 compared to 85pc in 2018. The company’s gross profit declined by 17pc to MXN5.080bn from MXN6.136bn compared to the prior year. Gross profits compared to sales also declined by 2 percentage points to 13pc in 2019 against 15pc in 2018.
EBITDA decreased by 20pc to MXN4.761bn in 2019 from MXN5.935bn compared to a year ago primarily on lower prices that encountered their steepest decline in Q4 2019. The company’s EBITDA declined by 44pc from MXN1.310bn in Q4 2018 to MXN737mn in Q4 2019.
ICH manufactures structural long products such as rebar, wire rods and tubing as well as operating scrap recycling sites.
($1 = MXN19.73)