MEXICO CITY (Reuters) - Steel producer Ternium plans to spend around $1 billion on expanding its plant in northern Mexico, a top executive said during a call to discuss fourth-quarter results.
"The company is in the final stage of launching a new expansion initiative to complement all these capabilities we have in the Pesqueria facility," said Maximo Vedoya, Ternium's chief executive told analysts on Wednesday.
The investment will go towards expanding a Mexican plant located near Monterrey known as Pesqueria, a facility dating back to 2013 which recently added a hot-rolling mill to serve the automotive, appliance and construction sectors.
The expansion plan includes a second cold rolling mill, a third galvanizing mill, and several finishing lines.
The steel production company, which operates in Mexico, Brazil, Argentina, Colombia, the United States and Central America, posted $4.3 billion in net income in the fourth quarter, up from $867 million in the same period a year before.
However, Ternium's shipments amounted to 2.8 million tons in the last quarter of 2021, down 8% compared with 2020, mainly as a result of lower steel shipments in Mexico.
The company's shipments in Mexico, one of its main markets, dropped more than expected during the fourth quarter due to supply chain constraints and a semiconductor shortage for vehicle manufacturing. The auto industry represents one fourth of its sales volume.
Ternium's Chief Operating Officer Pablo Daniel Brizzio, said he expects finished steel shipments in the region to increase during the first quarter.