Ternium S.A. Form 6-K Summary
Business Context and Reporting Period
This Form 6-K filing, dated March 20, 2020, serves as a notice of the Annual General Meeting (AGM) and Extraordinary General Meeting (EGM) of Ternium S.A., a Luxembourg-based steel company. The meetings are scheduled for April 27, 2020. The filing relates to the fiscal year ended December 31, 2019, and includes the approval of consolidated financial statements, the election of directors, and the renewal of authorized share capital.
Key Financial Metrics
The filing references the 2019 Consolidated Management Report for detailed financial data. Specific metrics disclosed in this text include:
- Consolidated Profit (2019): USD 630,045,260.
- Annual Accounts (2019): The filing notes that the Company's annual accounts as at December 31, 2019, show a loss for the year, which will be absorbed by retained earnings.
- Proposed Dividend: USD 0.12 per share (USD 1.20 per ADR), payable on May 5, 2020.
- Total Dividend Payout: Approximately USD 235,569,213 (net of Treasury Shares).
- Share Capital: Issued share capital is USD 2,004,743,442 (2,004,743,442 shares). Authorized share capital is proposed to be USD 3,500,000,000.
- Treasury Shares: The Company holds 41,666,666 shares.
Note: Specific revenue, cash flow, margin, and debt figures are not provided in this filing text; they are contained in the referenced 2019 Consolidated Management Report.
Material Changes and Governance Actions
The filing outlines several material corporate actions to be voted upon:
- Board Composition: The Board size will increase from eight to nine members. Eight current directors are up for re-election, and Mrs. Gioia Ghezzi is proposed as a new director.
- Director Compensation (2020): Base fee of USD 115,000 per director. The Chairman receives an additional USD 295,000. Audit Committee members receive an additional USD 55,000, with the Chairman of the Audit Committee receiving an extra USD 10,000.
- Auditor Appointment: PricewaterhouseCoopers (Luxembourg member firm) is recommended for reappointment for the fiscal year ending December 31, 2020.
- Share Capital Renewal: Renewal of the authorized share capital validity for five years, including the waiver of pre-emptive subscription rights for specific issuances (e.g., acquisitions, employee incentives up to 1.5% of issued capital).
Outlook, Risks, and Management Commentary
Management Commentary: The Board emphasizes that the renewal of authorized share capital and the waiver of pre-emptive rights are essential for the Company's long-term strategy. The Board argues that these measures provide the necessary flexibility to react quickly to acquisition opportunities, joint ventures, and strategic financing without the delays associated with Luxembourg law's preferential subscription rights procedures.
Risks and Contingencies: The filing does not detail specific operational risks or contingencies for 2020. However, it notes that the 2019 annual accounts reflect a loss, which will be covered by retained earnings. The filing also references standard appraisal rights for dissenting shareholders in the event of delisting, mergers, or asset sales.
Investor Verification Checklist
- Verify the full 2019 Consolidated Management Report to reconcile the reported consolidated profit (USD 630M) with the loss shown in the annual accounts.
- Confirm the exact dividend payment date and record date once the Board finalizes the terms.
- Review the biographical details of the new director, Mrs. Gioia Ghezzi, and the re-elected board members.
- Monitor the outcome of the vote on the waiver of pre-emptive subscription rights, which impacts future dilution potential.
- Check the 2019 financial statements for specific revenue, EBITDA, and debt levels not included in this summary.