Good morning. My name is Denise and I'll be your conference operator today. At this time I'd like to welcome everyone to the Ternium Third Quarter 2017 Results Conference Call. [Operator Instructions] Thank you. Sebastián Martí, you may begin your conference. Sebastián Martí: Good morning, and thank you for joining us today. My name is Sebastián Martí and I am Ternium's Investor Relations Director. Ternium issued a press release yesterday detailing its results for the third quarter 2017. This call is complementary to that presentation. Joining me today are Mr. Daniel Novegil, Ternium's CEO; Mr. Pablo Brizzio, Ternium's Chief Financial Officer; and Mr. Maximo Vedoya, Ternium's Mexico's Executive Vice President, who will discuss Ternium's business environment and performance in the third quarter 2017. At the conclusion of our prepared remarks, we will open up the call to your questions. Before we begin, I would like to remind you this conference call contains forward-looking information and that actual results may vary from those expressed or implied. Factors that could affect results are contained in our filings with the Securities and Exchange Commission and on Page 2 in today's webcast presentation. With that, I'll turn the call over to Mr. Novegil.

Thank you, Sebastian. Dear gentlemen, a good morning to everybody and thank you so much for all of you participating in today's call. I will start today by making a few comments regarding the announcement about my succession as Ternium's CEO. Actually, as a matter of fact, a Maximo Vedoya is participating today with us in the call, and we believe this could be a good opportunity for those of you who don't really know him to listen and to hear his thoughts and his ideas, especially looking forward. I would like to start this call first of all thanking Paolo Rocca and the rest of the board of directors of Ternium for having given to me the opportunity and responsibility to lead this wonderful company for so many years. And it has been quite an adventure for me over the past 12 years, filled with a lot of success, challenges, ups, downs, good, bad, and that has been very interesting and -- so to speak, and so to say, rewarding to me and to the company. It has been to me a privilege to serve as Ternium's CEO and to work alongside this very qualified management team. I also take the opportunity to thank all of you, the investment community represented by you, for listening today and for participating in the calls, in Investor Days, in non-deal road shows and so on, and I want to thanks also for your support and interest in Ternium over these many years. Gentlemen, I really do appreciate what you've done for the company and all the interest that you show over the years in Ternium's success and history. No doubt that in my view and in the board of directors' view, and in the view of Paolo Rocca as well, Maximo is…

Thank you very much, Daniel, for that kind words, and good morning to all of you. I think there is no doubt of your outstanding contribution to Ternium over the last past years, Daniel, and I'm very honored to be your successful, and I will work hard to live up to the high standards that you have set for all of us in Ternium. As you said, I'm looking forward to continue to execute our strategy that we set up over the years -- our strategy of differentiation, of operational excellency -- to continue to strengthen our customer base, to advance in the automation and digitalization of our value change and to develop even more sophisticated products. I am also eager to continue working with you during this transition period over the next few months; but I think, most important, I'm very pleased that you will continue to be available to me and to all our management team to advice and counsel in your future role as Vice Chairman. So thank you very much for that.

Thank you, Maximo. I take the opportunity to congratulate you. You deserve this position. You are going to be no doubt an excellent CEO for Ternium; pretty much better than the current one. So I'm really very happy today of passing to you this legacy of excellence and performance and so on. Entering into our call today and entering into our quarter results, you can see in our numbers Ternium continues showing a very good result in the third quarter of 2017. And right after these remarks, I will ask Pablo Brizzio to share his view on the drivers of our performance in the period. But before entering into the third quarter results detail, I'd like to make some comments on what have been these 9 -- these last 9 months, where Ternium had accumulated an EBITDA of $1.4 billion; an EBITDA margin of 21%. we compare pretty well, as you know, against our peers and competitors. On the balance sheet side, we had a net debt -- we -- of just 1.5x, so that this continues to be an asset -- a very strong financial position, even after paying for the acquisition of CSA in -- former CSA in early September. So now let's go to pay a look and -- a brief overlook on what is going on in the global steel market and in our position in -- competitive position in the steel landscape. As you know, the world economy seems to be shifting to a more stable state, with expectations of some kind of healthy growth, so to speak, in most -- in the most relevant world economies. This kind of optimism is also reflected in the steel industry, based upon the strength of the U.S.A. and Europe's economies and a good performance of emerging markets…

No.

Complicated, but anyway.

Not very easy, and clearly there's a lot of uncertainty about the future of the NAFTA and what is going on. The fourth negotiations were -- the 4 round of negotiations were over. The fifth round is going to be held in Mexico City. And as I said, and as you said, there is a lot of uncertainty about the future of NAFTA. But as all of you can infer from our recently announced investment in Mexico, our long-term view of the trade relationship between the U.S. and Mexico continues to be positive. The trade integration that happened in the region after the NAFTA implementation has been very positive for the 3 countries involved. It enables them to develop the manufacturer value chains that allows today the region to compete in good terms with similar value chains in Europe and even in Asia. I have no doubt that the agreement can be improved and the current negotiations could modernize it, considering that it's almost 25 years old. But of course, the question here is what if the NAFTA negotiators are unable to reach an agreement? What happen next? And we think that in that case we continue to see a region integration under the WTO rules. We believe the region would do, under NAFTA agreement, much better; but we don't see a major impact for Ternium's if the trade among the NAFTA members were ruled only by WTO regulations, if NAFTA ceased to exist. Trade in North American Region we think will continue. The U.S. and Mexican economy today are mutually dependent. Both countries will do better off with more trade than with less trade, and I believe Mexico provides a competitiveness to the U.S., which is something that the U.S. company value. Again, I think removing -- renewing the NAFTA -- continue with the NAFTA is the more logical step, but we don't see a major impact if the relationship between the U.S. and Mexico will be governed by WTO rules.

Thank you, Maximo. Still some uncertainty, but I think that at the end there is no big impact of -- in any of the expected scenarios. At this point of the call and related to our investments in Mexico, I would now like to share with you my views regarding our latest announcement of the construction of the hot strip mill in our Pesqueria facility in Mexico, in Monterrey, which follow the announcement 6 months ago of the construction of a new galvanizing mill, a new painting mill, at the same site -- and a new painting mill at the same time in Pesqueria. These announcements of additional high-end downstream capacity in Mexico were the logical next steps after the acquisition of our new slab facility in Brazil, formerly known as CSA. The hot strip mill, once operational, will integrate upstream with Ternium's state-of-the-art slab capacity in Brazil. Again, which Ternium's state-of-the-art capacity that will combine with Ternium's state-of-the-art capacity in Monterrey for hot rolling. So -- and downstreaming into -- with our state-of-the-art facilities, as I mentioned, which has the latest generation of cold rolling and galvanizing equipment. So at the end, it will also help us to substitute hot rolled steel that we are currently importing from third parties into Mexico; and also, we will use some less efficient capacities -- some inefficient capacity currently in operation in Ternium. That means that, with this hot rolling capacity, we will increase our market share against imports. We will be taking over our own imports for the system. And in -- and third, we will be reducing less efficient capacity in Monterrey. As you already know, our aim is to meet the expected growth of steel consumption in Mexico and increase Ternium market share by taking over these high-value-added imports,…

Thanks, Daniel. Good morning, and thank you, all of you, for participating in our conference call. As Daniel said, I will give you an overview of our performance in the third quarter of this year, and afterwards we will have the Q&A session. But first of all, let me take this opportunity, Daniel, to tell you it has been a pleasure and honor to work with you. And after working together with Maximo for many years, also let me tell you that I will do my best to help you in your new venture. So with this, let's please turn now to the Page 3 of our webcast presentation. Our overall performance continued to be strong in the third quarter of this year, with EBITDA generation of $466 million, slightly lower than the EBITDA in the second quarter, as anticipated in our last quarterly results conference call. Before we continue, let me remind you that following the acquisition of CSA, which has changed its name to Ternium Brasil, we began consolidating Ternium Brasil operating in September 2017. This naturally results in higher shipment volume in the quarter and the decrease of Ternium's consolidated margins. Having said that, looking at Ternium's EBITDA per ton on the lower left side and EBITDA margin on the higher right side, we posted in the third quarter a sequential decrease to $152 per ton and a 19% margin. These decreases were in part related to the consolidation of 1 month of Ternium Brasil results in the third quarter. This effect will be fully reflected in the fourth quarter as we will be consolidating a full quarter of Ternium Brasil's results. As for net income in the third quarter 2017, we reported $233 million, equivalent to earnings per ADS of $0.99, a $0.28 sequential decrease due…

[Operator Instructions] Your first question comes from Marcos Assumpcao. Marcos Assumpção: Good luck for Maximo. Two questions here on the results. First, on CSA, when do you expect to reach full capacity at CSA, or if you're already there, close to 5 million tons? And as you started to operate the asset, what is the room to further reduce costs? Second question on demand in Argentina. We're seeing that positive demand there spreading to other sectors; also on the appliance sector and the automotive as well, and you had that previous guidance of sales volumes growing by 10% this year and next year. Given the positive outlook for the economy there, could we see stronger volumes in Argentina in the coming year?

Thank you, Marcos, and let me start with the same question related to the CSA acquisition. Currently, from the marketing on the sale at some point, we -- our plans for former CSA are -- regarding deliveries are the following: 2 million tons to Calvert under the current contract that expires in September '19; approximately 1 million tons of local sales in Brazil, mainly; and third, the balance to Ternium Mexico or third parties. So 4 customers: Calvert, Brazil domestic market, Ternium Mexico and third parties. As you know, the group of assets that we bought in Brazil are cash flow positive. We do not foresee any need for cash inflows for the ordinary operations. And regarding CapEx, as you know, CSA has already all the environmental permits that CSA needs for the operation, and so that the CapEx will be around, I could say, $50 million to $100 million per year on an ongoing basis. That includes the regular relining of blast furnaces if needed. Marcelo Chara is in charge of the operation -- is the new CEO of CSA. He's a very experienced manager; used to be the actual director for Siderar, Usiminas and [indiscernible]. And any time -- every time we enter into a company this size, we develop a turnaround plan that -- where we add our knowledge, our experience and our track record to the existing system, so that Ternium will work in every aspect of the business to take CSA to its maximum potential, as we do with all our facilities. You know that we have a 100-days plan after an acquisition, and we have budgeting and we have a very strict set of means and recommendations in order to improve productivity in each particular area of the company. Regarding your question regarding production…

Thanks a lot, Marcos. I do appreciate your comment. Thanks.

Your next question comes from Carlos De Alba.

Daniel, congratulations on a successful tenure in Ternium, and all the best in your new position. Maximo, good luck also with the big change in responsibilities. The question that I have has to do with, what do you expect in terms of working capital going forward this year? Clearly, because of the increasing prices, a lot of the EBITDA generation has been sucked up into the balance sheet and into working capital. Going forward, can we expect stable levels of -- or at least more sustainable levels of working capital, so that cash regeneration increases? And also, if you have any updates on your views for the growth in steel consumption in 2018 in both Mexico and Argentina, plus any updates on your CapEx plans for next year and the total amount of CapEx if you have it already, that would be great.

Thank you, Carlos, for your comments and your remarks. So let me pass the working capital issue to Pablo Brizzio and then I'll come back to see some more updates on Mexico and Argentina and CapEx.

As we have described in the initial remarks, we confirm what we were expecting for this quarter, and the big impact that we have in working capital during the first part of this year. The main change in working capital for the year was during the first semester, where we have the increase in price of the product, the volume increases and of course the tax payment that we already mentioned. The most significant change that we saw during the third quarter was related to pulling together Ternium Brasil in our financials and the impact of the new product that the Brazil operation is selling and the trades in relationship to that. So we are not expecting to further have significant changes on working capital in the coming quarters. Of course, you know that you have some changes in relationship to the different plans or CapEx that we need to do in relationship to the maintenance of the different facilities. But since we are not all suspecting, as Daniel mentioned, significant changes in prices, there should not be big movements in the working capital in the coming quarters. And in fact, this is the goal that we have to sustain the working capital levels that we have been seeing at the end of the third quarter, and coming into the fourth and the coming year we are expected to sustain, and even if we can reduce a little bit working capital. So Daniel, I don't know if you want me to answer in regards to CapEx or [indiscernible]?

Let me comment first on the situation in Mexico, Argentina, and then into CapEx. Regarding Argentina, as I said before, there are sectors that are doing really very well, Carlos. I think that we had a chance of talking about that at the last meeting we had. And agribusiness is doing very well. Infrastructure is doing very well. Argentina is lacking investment in infrastructure, and now there is an infrastructure plan that will last for 5 or 6 years in order to update logistics and harbors and railroad systems and roads and so on and so forth, so there is going to be a source of demand for steel, and also the alternate energy, wind and solar. And oil and gas are also doing very well. On top of that, the home appliances are recovering. And the automotive industry is doing very well regarding sales; not yet in production, because of not having the possibility to export to Brazil until the market in Brazil fully recovers. That will be something that we expect for the coming year. The coming year is expected a total production of cars in Brazil of 2.4 million cars approximately. That means that there is an outstanding recovery from the 1.4 million, 1.5 million that it's had in the recession some time ago. So it's an important recovery. Regarding Mexico, Mexico is also doing well. But let me first share with you some precise numbers on Argentina. In 2017, the shipments, or the steel use, I could say -- the steel apparent consumption in Argentina of flat products will increase around 12.5% in relationship with 2016. That was not a good year. In 2018 we expect another growth against 2017 of 10%. That means that we are accumulating 12.5% in '17 and 10% in '18. So…

Okay. We have been running a very low level of CapEx in the last years, after the latest CapEx plan back to 2014. So this year will end a number that we are already expecting at the end of the year of around $450 million. And in the coming year, in 2018, we will move that number to a level that will be close to $600 million. That of course does not include the big chunk of the investment related to the announcements that will be impacting fully in the following year, in 2019. But our expectation, pulling all together for 2018, is around $600 million.

Your next question comes from Leonardo Correa.

I would also like to extend my congratulations to Daniel. Great work over the past year, Daniel, and many accomplishments and achievements, and much -- I hope things can be smooth, and I'm certain that we're going to see a very smooth transition going forward. In terms -- just in terms of some of the questions, first one maybe for Pablo -- and I know that this quarter we already saw the new -- let's say, the new numbers, and we got a little bit of indications on how to see Ternium's numbers. But just picking on EBITDA per ton over the next quarters on how to think of these -- this metric over the next years, especially now with the consolidation of CSA, which is a lower-margin business, right? So just wanted to -- or, sorry, a lower-EBITDA-per-ton business. This -- a second point, which is -- sorry to be asking something that maybe we have very little visibility on, but thinking of Section 232, which in the United States is still seen as a catalyst even though it's been highly delayed, just wanted to get your latest thoughts, Daniel, on Section 232 in the U.S. and potential implications on your business. This -- I assume this is probably going to be an event for 2018 only. And finally, if I may, just on dividends, guys, this obviously has been the hot topic over the past years. And I understand there is no formal policy and this is going to be discussed on a case-by-case basis. But just considering now leverage moving up to 1.5x, which perhaps is a bit higher than the comfort zone for Ternium over the past quarters, how do you see dividend specifically in 2018? Those are the questions.

Thank you, Leonardo, and I really do appreciate your comments on my performance. And I will pass to Brizzio for the first and third question, and then Maximo will quote on the 232, that is an easy question.

Yes, very easy.

As we reflected into this third quarter, that all included one month consolidation of our operation in Brazil, there was a clear change in the EBITDA per ton and in the EBITDA margin. We moved these 2 numbers into this third quarter to $152 and 19% EBITDA margin. The expectation for the following quarters, that clearly as you mentioned will fully consolidate our operation in Brazil, including the 3 months of the quarter, will impact in our numbers. But as we already gave the outlook for the quarter, we are expecting some reduction in relationship mainly to issues of Mexico with the seasonality and other things. So we will -- we are continue working with the same range that we have been working in the past, which is to sustain the level of EBITDA margins at a range between 15% and 20%, trying to work these as high as we can. Clearly, after the inclusion of lower value added product sales of slabs to our customers in Brazil and customers in the U.S., which are the only one reflected in our financials, we are reducing the margin. In any case, we expect to sustain this very healthy level of EBITDA margin. In the case of EBITDA per ton, as we always say, it is something that we prefer -- we know that you like it, but we prefer not to quote in that one, because at the very end it's dependent on the prices of the steel. But clearly we'll suffer a little bit also in that respect; but we will continue working on everything that we do to sustain the -- this new level of EBITDA margin. So with this, Daniel, if you would like to mention in the second one.

Yes. No, no. In the second part, in the Section 232, I would say that there are 2 issues there. One is regarding the impact of the 232 in prices, that is maybe what Leonardo is trying to quote about. And also, then, the impact in trade between Trump and -- between NAFTA and Mexico. I will quote in the first part, regarding the prices in U.S. and Mexico -- as you know, Leonardo, prices have been gradually decreasing in the U.S. and Mexico as well since September. We have I would say 1.5 months of decreases in pricing. These decreases in prices in Mexico obviously are in line with the prices in the U.S., and maybe because -- there are different factors. One, commercial products demand in the south of the U.S.A. was a little bit weak as a result of the earthquake. And -- but now, as reconstruction efforts are taking some time to start, it will bring about good winds of rebounding in the south of the U.S.A. Imports are also quite high at this point in time in the U.S., coming especially from Asia. What gives the ground for the 232? I believe -- regarding prices, Leonardo, I believe that maybe we are pretty close to seeing the floor on this price decrease in the moment. And the fundamentals for the rebound that I expect in prices in this particular market -- in the U.S. market, especially in the beginning of 2018, given that the rest of the fourth quarter is weak because of seasonal factors, is that we see in the U.S. a steady end user demand. That is the main factor, the demand side. On the supply side, we also see that the U.S. steel industry is running at a utilization rate of 75%. That is quite high related to the history and is a quite -- very high level of utilization rate for the U.S. That means that any production disruption because of any factor -- weather; whatever -- it could immediately impact in the supply side, and maybe it will be giving room for a price recovery. Also, inventories and lead times in the customer side showed that they are about to stop the recent restocking. Inventories are lower than the standard ones and the lead times are short, and that means that it will go to longer in the short run. That means that, together with and coupled with the high capacity utilization, will give ground for some price rebound. Also, we see a very active and supportive stance in the U.S. as well as in Mexico against unfair trade -- these imports coming from abroad are negatively impacting the consumption and will bring some reduction. Maximo, your view on the 232, Mexico, U.S., trade, NAFTA?

Thank you. Well, regarding specifically the 232, I think, Leonardo, you are right -- we are seeing that the 232 has been pushed forward, and if it comes it's going to come somewhere in 2018. The Trump administration has prioritized other things and they are putting this a little bit forward. Nevertheless, the case for 232 -- I think it's still open and I think there is a chance that the 232 is going to pass. What we are not seeing is that Mexico is going to be included. The trade between flat products between Mexico and the U.S. is very positive to the U.S. It's almost 2 million tons -- 1.6 million last year. It's going to be around 1.7 million or 1.8 million this year. So it doesn't make any sense to restrict commerce in something that is very, very positive to the U.S. So I think there is a chance that the 232 is going to come later, but we don't see much impact on a negative side.

If the concern is on trade deficit, in steel you have a trade surplus.

Exactly.

For -- that is beneficial for the U.S. So there is no sense to try to fit or to fix what is already doing well.

Yes. Exactly.

It is better to concentrate in China or some other trade negatives. But anyway.

Okay. If you let me, Daniel, I will take the third part of questions that Leonardo made, which were related to dividend policy. You have seen that the company continues to generate very strong EBITDA. This year will be the case. This year, we have a significant investment, which was the acquisition of CSA that we consider a great opportunity, but the level of net debt to EBITDA continues to be strong at 1.5. So we moved from 0.6 to 1.5. And though, as you said, we don't have a formal policy of dividend and this is announced once a year, we have no reasons to believe that they see -- next year the dividend payment should be at least the level that you have seen this year.

[Operator Instructions] Our next question comes from the line of Caio Ribeiro.

So my first question is regarding the expansions in Mexico and Colombia, and whether you can give us some additional color on what type of contribution that you expect in terms of additional EBITDA coming from these projects. And my second question, from a more strategic point of view -- after the acquisition of CSA, which helped Ternium bridge a slab deficit that the company had for a very long time, and the announcement of the expansion in Mexico, which will integrate this additional slab capacity from CSA, I just wanted to get a sense from you on what you believe will be the next landmark for the company that you will aspire to achieve, and where you see additional potentials to unlock value here, whether it will be through additional growth in existing markets, or cost-cutting at existing operations or perhaps expanding to new markets.

Well, let me take a stab for the last part of your question, Caio, and this is related with which are our plans now. We are in a process of consolidating. We have done an acquisition that is important even when the debt ratio is very healthy. We are also -- we have to consolidate the downstream integration of this facility into the expansion in Mexico, and -- so that our efforts, our targets, our main drivers now is to consolidate and to create value on the investments that we are doing. So we are in a kind of, so to speak, swallowing and digestion move. And the mode is that we have to swallow first and to digest then, and afterwards maybe we will be thinking over about what to do moving forward. Pablo, you want to quote on the first part of question that...?

Yes. Okay. And this goes in line with what Daniel has just said. We are extremely happy with the decisions that we took in relationship to the new investment plans, both in Mexico and Colombia. Clearly, as you know and we described in the past, we have a minimum internal rate of return for these -- any project that we will take, of around 10%. In this case, we clearly overpassed these percentages because we clearly believe that these 2 projects, especially the one in Mexico which is the biggest one, clearly is targeting a significant move for the company to keep growing in an expanding market and substituting imports. So clearly, these are 2 projects that are -- that will generate a positive number for the company and will contribute to increased EBITDA generation. Well, we will need to wait until 2020 in the case of Mexico to have these project completed, so -- but right now we are looking at very healthy CapEx plans.

Perfect. And if I just might have a quick follow-up here, regarding leverage with the consolidation of CSA, right now it's at 1.5x net debt and potentially moving higher in the next couple of years. What do you guys expect in terms of a peak in leverage, and what are some of the initiatives that the company could choose to adopt if leverage turns out that it surpasses this threshold?

Well, we don't have a specific target. On -- the other way around: we like to have the most strong financial position we can, and we will work in the coming quarters to even further reduce the leverage ratio of the company. The CapEx plans that we have been explaining, and in relationship to a question that we have recently, which was the level of CapEx for next year, which still will be more a level of CapEx of $600 million for the following year. So -- and then in the following one, in 2019, we will have a higher level of CapEx in relationship to these new plans. So we will continue to -- and our goal and our target is to continue having this very strong level of financial statements and to sustain a moderate level of debt. And we have never overpassed, in the history of the company, levels of around 3. But we are very far from that numbers, or we are not even thinking of reaching numbers at that level. So we will continue working on having and sustaining a very strong financial position.

Our final question comes from the line of Thiago Lofiego.

I'm not sure if that's me. Thiago Lofiego here from Bradesco. Can you hear me?

Yes, Thiago.

So I have two questions, the first one regarding the competitive environment in Mexico in the coming years, especially considering ArcelorMittal's recent expansion program, which is pretty much focused on downstream product as well, quite similar to your own strategy. So if you could comment on, how do you see competition evolving? I know Mexico still as a country imports a lot of steel, so there may be room for everybody. But just to understand, what's your thoughts on that? And the second question on Argentina. How should we think about pricing dynamics from here? Considering a scenario of flattish international steel prices, would you see room for price hikes in Argentina in 2018? That's it.

Good. Thank you, Thiago. Regarding the competitive environment in Mexico and the impact of the announcement -- the recent announcement of a Mittal new hot rolling mill, I would say that -- 2 things. First, there is enough room in Mexico for them and for us. As I said before, the imports of flat rolled products are gathering 50% of the market -- 5-0. 50% of the market. That's a huge amount of steel. So there is enough room for both plants, and no doubt that we will have together the opportunity to gain market share against imports coming from different places, different level of quality, say, logistics complications, just -- un-just time deliveries, and so that we have a good opportunity for both of us, first. Second, for us, the downstreaming of our operation in CSA, that is the main reason for our investment in Mexico, is a continuity of value added that ends up in service centers, lead-in lines, [indiscernible] lines, galvanizing lines -- the new galvanize facility that we just announced 1.5 months ago, coated facilities. It's not the case of Mittal. Mittal is going to be building a hot rolling mill whose level of integration in comparison with our vertical level of integration is really very low. I'm not being detrimental to the investment, but it's a fact. The -- we are going to be increasing the whole value added chain. And so the level of integration of one facility on the other is quite different, first. Regarding the -- let me also quote, before going to the Argentine pricing situation that we're -- Pablo Brizzio will comment in detail, let me tell you that, regarding the outlook of the company, even when in our quarterly report we said that we are going to be having a lower level of result, I -- we do see a slightly downturn in these numbers. Slightly, I would say. But we are going to be still having a very good EBITDA ratio; a very good EBITDA total value. And also, and following up on one of the previous questions, regarding the cash flow levels, the free cash flow levels, we do have opportunities now to work in a better concentration in working capital, so that we have there reduction opportunities because of the fact that we are going to be supplying part of our needs from our own facilities. That means that we have an interesting room for the reduction in working capital in slabs to supply what we were buying from abroad and from third parties. So regarding the free cash level -- free cash flow level, I'm pretty optimistic that we have room for, and opportunities for having a good result. Regarding the EBITDA ratio, even when it's going to be maybe a little bit below the number, it's going to be healthy -- still very healthy. Regarding prices in Argentina, Pablo?

A very short answer to that. We are currently moving at prices level in Argentina we are -- which are very, very similar, in fact the same level of prices that we can see today in Mexico, or in the U.S., or in other parts of our region. So we are expecting to see continuity of these. If we see change in prices, even -- either up or down, you will see exactly the same reflection in the prices in Argentina. So clearly, a very open market, the one that we have in Argentina, and prices will reflect what we see in the region.

That are quite similar to the ones in Brazil, in Mexico and the U.S. The pricing system of Argentina is not different. As we have mentioned in and quoted in some of the Investor Days, at conferences and so on, the prices are good. And the costs are very, very competitive because of economies of scale, because of market share and because of the relationship with customers, networking -- commercial networking and so on. Gentlemen, we think that we -- Sebastian, if it was the last question, again, I would really thank you for your participation. I really appreciate your comments on the performance of Ternium and my personal involvement in that, and also I would appreciate your desires of good luck to my successor in Mexico that, on top of being an outstanding executive, has been a very close friend of mine for many years. And so Mexico is -- so Maximo, good luck.

Thank you.

Your success is our success. So team up, lead and go for it. All right. Thanks a lot again, and we hope to see you again shortly. Any questions to be driven by Sebastian. Sebastián Martí: Okay. Sure.

Bye. Thanks a lot.

This concludes today's conference call. You may now disconnect