UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934

COMMISSION FILE NUMBER 1-11176

For the month of
May, 2010.

Group Simec, Inc.
(Translation of Registrant’s Name Into English)

Av. Lazaro Cardenas 601, Colonia la Nogalera, Guadalajara, Jalisco, Mexico 44440
(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

        Form 20-F |X| Form 40-F |_|

Indicate by check mark whether the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1)

        Yes |_| No |X|

Indicate by check mark whether the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7)

        Yes |_| No |X|

Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

        Yes |_| No |X|

(If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):
82-_______________________.)


SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 
GRUPO SIMEC, S.A.B. de C.V.
(Registrant)
     
Date: May 5, 2010. By:     /s/ Luis García Limón
   
    Name: Luis García Limón
    Title: Chief Executive Officer

MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

CONSOLIDATED FINANCIAL STATEMENT
AT DECEMBER 31 OF 2009 AND 2008
(thousands of Mexican pesos)

AUDITED

REF
S		 CONCEPTS CURRENT YEAR PREVIOUS YEAR
    AMOUNT % AMOUNT %
s01 TOTAL ASSETS 26,883,123 100 30,814,017 100
 
s02 CURRENT ASSETS 12,477,733 46 13,045,429 42
s03 CASH AND SHORT-TERM INVESTMENTS 1,948,900 7 576,741 2
s04 ACCOUNTS AND NOTES RECEIVABLE (NET) 2,062,155 8 2,855,472 9
s05 OTHER ACCOUNTS AND NOTES RECEIVABLE 1,477,367 5 504,818 2
s06 INVENTORIES 6,792,064 25 8,849,906 29
s07 OTHER CURRENT ASSETS 197,247 1 258,492 1
s08 LONG-TERM 0 0 0 0
s09 ACCOUNTS AND NOTES RECEIVABLE (NET) 0 0 0 0
s10 INVESTMENT IN SHARES OF NON-CONSOLIDATED
   SUBSIDIARIES AND ASSOCIATES		 0 0 0 0
s11 OTHER INVESTMENTS 0 0 0 0
s12 PROPERTY, PLANT AND EQUIPMENT (NET) 9,794,942 36 10,291,145 33
s13 LAND AND BUILDINGS 3,734,281 14 3,731,695 12
s14 MACHINERY AND INDUSTRIAL EQUIPMENT 12,973,637 48 12,790,306 42
s15 OTHER EQUIPMENT 232,275 1 230,015 1
s16 ACCUMULATED DEPRECIATION 7,504,768 28 6,847,468 22
s17 CONSTRUCTION IN PROGRESS 359,517 1 386,597 1
s18 OTHER INTANGIBLE ASSETS AND DEFERRED ASSETS (NET) 4,468,951 17 7,351,774 24
s19 OTHER ASSETS 141,497 1 125,669 0
 
s20 TOTAL LIABILITIES 6,901,229 100 9,508,520 100
 
s21 CURRENT LIABILITIES 4,067,703 59 5,255,145 55
s22 SUPPLIERS 1,896,825 27 3,399,772 36
s23 BANK LOANS 0 0 8,800 0
s24 STOCK MARKET LOANS 3,944 0 4,055 0
s103 OTHER LOANS WITH COST 740,285 11 273,474 3
s25 TAXES PAYABLE 334,278 5 298,251 3
s26 OTHER CURRENT LIABILITIES WITHOUT COST 1,092,371 16 1,270,793 13
s27 LONG-TERM LIABILITIES 0 0 0 0
s28 BANK LOANS 0 0 0 0
s29 STOCK MARKET LOANS 0 0 0 0
s30 OTHER LOANS WITH COST 0 0 0 0
s31 DEFERRED LIABILITIES 0 0 0 0
s32 OTHER NON-CURRENT LIABILITIES WITHOUT COST 2,833,526 41 4,253,375 45
 
s33 CONSOLIDATED STOCKHOLDERS’ EQUITY 19,981,894 100 21,305,497 100
 
s34 MINORITY INTEREST 2,191,358 11 3,122,342 15
s35 MAJORITY INTEREST 17,790,536 89 18,183,155 85
s36 CONTRIBUTED CAPITAL 8,350,900 42 8,350,900 39
S79 CAPITAL STOCK 4,142,696 21 4,142,696 19
s39 PREMIUM ON ISSUANCE OF SHARES 4,208,204 21 4,208,204 20
s40 CONTRIBUTIONS FOR FUTURE CAPITAL INCREASES 0 0 0 0
s41 EARNED CAPITAL 9,439,636 47 9,832,255 46
s42 RETAINED EARNINGS AND CAPITAL RESERVES 9,075,705 45 9,507,958 45
s44 OTHER ACCUMULATED COMPREHENSIVE RESULT 363,931 2 324,297 2
s80 SHARES REPURCHASED 0 0 0 0


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

CONSOLIDATED FINANCIAL STATEMENT
BREAKDOWN OF MAIN CONCEPTS
(thousands of Mexican pesos)

AUDITED

REF
S		 CONCEPTS CURRENT YEAR PREVIOUS YEAR
    AMOUNT % AMOUNT %
s03 CASH AND SHORT-TERM INVESTMENTS 1,948,900 100 576,741 100
s46 CASH 1,109,012 57 234,679 41
s47 SHORT-TERM INVESTMENTS 839,888 43 342,062 59
 
s07 OTHER CURRENT ASSETS 197,247 100 258,492 100
s81 DERIVATIVE FINANCIAL INSTRUMENTS 0 0 0 0
s82 DISCONTINUED OPERATIONS 0 0 0 0
s83 OTHER 197,247 100 258,492 100
 
s18 OTHER INTANGIBLE ASSETS AND DEFERRED ASSETS (NET) 4,468,951 100 7,351,774 100
s48 DEFERRED EXPENSES 2,574,564 58 3,099,182 42
s49 GOODWILL 1,798,160 40 4,166,160 57
s51 OTHER 96,227 2 86,432 1
 
s19 OTHER ASSETS 141,497 100 125,669 100
s84 INTANGIBLE ASSET FROM LABOR OBLIGATIONS 0 0 3,446 3
s85 DERIVATIVE FINANCIAL INSTRUMENTS 0 0 0 0
s50 DEFERRED TAXES 0 0 0 0
s86 DISCONTINUED OPERATIONS 0 0 0 0
s87 OTHER 141,497 100 122,223 97
 
s21 CURRENT LIABILITIES 4,067,703 100 5,255,145 100
s52 FOREIGN CURRENCY LIABILITIES 2,530,335 62 3,766,787 72
s53 MEXICAN PESOS LIABILITIES 1,537,368 38 1,488,358 28
 
s26 OTHER CURRENT LIABILITIES WITHOUT COST 1,092,371 100 1,270,793 100
s88 DERIVATIVE FINANCIAL INSTRUMENTS 216,753 20 376,206 30
s89 INTEREST LIABILITIES 5,461 0 5,251 0
s68 PROVISIONS 0 0 0 0
s90 DISCONTINUED OPERATIONS 0 0 0 0
s58 OTHER CURRENT LIABILITIES 870,157 80 889,336 70
 
s27 LONG-TERM LIABILITIES 0 0 0 0
s59 FOREIGN CURRENCY LIABILITIES 0 0 0 0
s60 MEXICAN PESOS LIABILITIES 0 0 0 0
 
s31 DEFERRED LIABILITIES 0 0 0 0
s65 NEGATIVE GOODWILL 0 0 0 0
s67 OTHER 0 0 0 0
 
s32 OTHER NON CURRENT LIABILITIES WITHOUT COST 2,833,526 100 4,253,375 100
s66 DEFERRED TAXES 4,737,770 97 4,172,251 98
s91 OTHER LIABILITIES IN RESPECT OF SOCIAL INSURANCE 33,140 1 34,095 1
s92 DISCONTINUED OPERATIONS 0 0 0 0
s69 OTHER LIABILITIES 62,616 2 47,029 1
 
s79 CAPITAL STOCK 4,142,696 100 4,142,696 100
s37 CAPITAL STOCK (NOMINAL) 2,420,230 58 2,420,230 58
s69 RESTATEMENT OF CAPITAL STOCK 1,722,466 42 1,722,466 42


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

CONSOLIDATED FINANCIAL STATEMENT
BREAKDOWN OF MAIN CONCEPTS
(thousands of Mexican pesos)

AUDITED

REF
S		 CONCEPTS CURRENT YEAR PREVIOUS YEAR
    AMOUNT % AMOUNT %
s42 RETAINED EARNINGS AND CAPITAL RESERVES 9,075,705 100 9,507,958 100
s93 LEGAL RESERVE 0 0 0 0
s43 RESERVE FOR REPURCHASE OF SHARES 200,612 2 200,612 2
s94 OTHER RESERVES 0 0 0 0
s95 RETAINED EARNINGS 9,198,031 101 7,511,209 79
s45 NET INCOME FOR THE YEAR (322,938) (4) 1,796,137 19
 
s44 OTHER ACCUMULATED COMPREHENSIVE RESULT 363,931 100 324,297 100
s70 ACCUMULATED MONETARY RESULT 0 0 0 0
s71 RESULT FROM HOLDING NON-MONETARY ASSETS 0 0 0 0
s96 CUMULATIVE RESULT FROM FOREIGN CURRENCY
TRANSLATION		 515,658 142 595,165 184
s97 CUMULATIVE RESULT FROM DERIVATIVE FINANCIAL
INSTRUMENTS		 (151,727) (42) (270,868) (84)
s98 CUMULATIVE EFFECT OF DEFERRED INCOME TAXES 0 0 0 0
s99 LABOR OBLIGATION ADJUSTMENT 0 0 0 0
s100 OTHER 0 0 0 0


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

BALANCE SHEETS
OTHER CONCEPTS
(thousands of Mexican pesos)

AUDITED

REF
S		 CONCEPTS CURRENT YEAR PREVIOUS YEAR
    AMOUNT AMOUNT
 
S72 WORKING CAPITAL 8,410,030 7,790,284
S73 PENSIONS FUND AND SENIORITY PREMIUMS 0 0
S74 EXECUTIVES (*) 56 60
S75 EMPLOYERS (*) 1,564 1,890
S76 WORKERS (*) 2,758 2,873
S77 COMMON SHARES (*) 497,709,214 497,709,214
S78 REPURCHASED SHARES (*) 0 0
S101 RESTRICTED CASH 0 0
S102 NET DEBT OF NON CONSOLIDATED COMPANIES 740,285 273,474

(*)      THESE ITEMS SHOULD BE EXPRESSED IN UNITS
 

MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

STATEMENTS OF INCOME
FROM JANUARY 1 TO DECEMBER 31 OF 2009 AND 2008
(thousands of Mexican pesos)

AUDITED

REF
R		 CATEGORIES CURRENT YEAR PREVIOUS YEAR
    AMOUNT % AMOUNT %
r01 NET SALES 19,231,529 100 35,185,220 100
r02 COST OF SALES 17,716,754 92 29,796,163 85
r03 MARGINAL PROFIT 1,514,775 8 5,389,057 15
r04 OPERATING EXPENSES 2,300,982 12 2,273,828 6
r05 OPERATING (LOSS) INCOME (786,207) (4) 3,115,229 9
r08 OTHER INCOME AND (EXPENSE), NET (2,338,009) (12) (3,916) 0
r06 COMPREHENSIVE FINANCING RESULT (96,298) 0 (174,661) 0
r12 EQUITY IN NET INCOME OF NON-CONSOLIDATED SUBSIDIARIES
AND ASSOCIATES		 0 0 0 0
r48 NON ORDINARY ITEMS 0 0 0 0
r09 (LOSS) INCOME BEFORE INCOME TAXES (3,220,514) (17) 2,936,652 8
r10 INCOME TAXES (2,045,402) (11) 1,036,303 3
r11 INCOME (LOSS) BEFORE DISCONTINUED OPERATIONS (1,175,112) (6) 1,900,349 5
r14 DISCONTINUED OPERATIONS 0 0 0 0
r18 NET CONSOLIDATED (LOSS) INCOME (1,175,112) (6) 1,900,349 5
r19 NET (LOSS) INCOME OF MINORITY INTEREST (852,174) (4) 104,212 0
r20 NET (LOSS) INCOME OF MAJORITY INTEREST (322,938) (2) 1,796,137 5


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

STATEMENTS OF INCOME
BREAKDOWN OF MAIN CONCEPTS
(thousands of Mexican pesos)

AUDITED

REF
R		 CONCEPTS CURRENT YEAR PREVIOUS YEAR
    AMOUNT % AMOUNT %
r01 NET SALES 19,231,529 100 35,185,220 100
r21 DOMESTIC 10,296,834 54 10,713,674 30
r22 FOREIGN 8,934,695 46 24,471,546 70
r23 TRANSLATED INTO DOLLARS (***) 660,671   2,198,590  
 
r08 OTHER INCOME AND (EXPENSE), NET (2,338,009) 100 (3,916) 100
r49 OTHER INCOME AND (EXPENSE), NET (2,330,747) 100 20,025 511
r34 EMPLOYEES’ PROFIT SHARING EXPENSES 7,262 0 23,941 611
r35 DEFERRED EMPLOYEES’ PROFIT SHARING 0 0 0 0
 
r06 COMPREHENSIVE FINANCING RESULT (96,298) 100 (174,661) 100
r24 INTEREST EXPENSE 48,644 (51) 57,288 (33)
r42 GAIN (LOSS) ON RESTATEMENT OF UDI’S 0 0 0 0
r45 OTHER FINANCE COSTS 0 0 0 0
r26 INTEREST INCOME 30,775 32 135,810 78
r46 OTHER FINANCIAL PRODUCTS 0 0 0 0
r25 FOREIGN EXCHANGE GAIN (LOSS), NET (78,429) (81) (253,183) (145)
r28 RESULT FROM MONETARY POSITION 0 0 0 0
 
r10 INCOME TAXES (2,045,402) 100 1,036,303 100
r32 INCOME TAX (641,742) 31 743,255 72
r33 DEFERRED INCOME TAX (1,403,660) 69 293,048 28

(***)      THOUSANDS OF DOLLARS
 

MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

STATEMENTS OF INCOME
OTHER CONCEPTS
(thousands of Mexican pesos)

AUDITED

REF
R		 CONCEPTS CURRENT YEAR PREVIOUS YEAR
    AMOUNT AMOUNT
 
r36 TOTAL SALES 19,884,915 35,618,819
r37 TAX RESULT FOR THE YEAR 0 0
r38 NET SALES (**) 19,231,529 35,185,220
r39 OPERATION INCOME (**) (786,207) 3,143,385
r40 NET INCOME OF MAJORITY INTEREST (**) (322,938) 1,796,137
r41 NET CONSOLIDATED INCOME (**) (1,175,112) 1,900,349
r47 OPERATIVE DEPRECIATION AND AMORTIZATION 1,047,882 867,150

(**)      RESTATED INFORMATION FOR THE LAST TWELVE MONTHS
 

MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

QUARTERLY STATEMENTS OF INCOME
FROM OCTOBER 1 TO DECEMBER 31 OF 2009 AND 2008
(thousands of Mexican pesos)

AUDITED

REF
R		 CATEGORIES CURRENT YEAR PREVIOUS YEAR
    AMOUNT % AMOUNT %
r01 NET SALES 4,954,253 100 7,617,888 100
r02 COST OF SALES 6,106,843 123 7,326,696 96
r03 MARGINAL (LOSS) PROFIT (1,152,590) (23) 291,192 4
r04 OPERATING EXPENSES 635,643 13 916,294 12
r05 OPERATING LOSS (1,788,233) (36) (625,102) (8)
r08 OTHER INCOME AND (EXPENSE), NET (2,345,808) (47) (56,867) 0
r06 COMPREHENSIVE FINANCING RESULT (47,114) 0 58,853 1
r12 EQUITY IN NET INCOME OF NON-CONSOLIDATED SUBSIDIARIES
AND ASSOCIATES		 0 0 0 0
r48 NON ORDINARY ITEMS 0 0 0 0
r09 (LOSS) INCOME BEFORE INCOME TAXES (4,181,155) (84) (623,116) (8)
r10 INCOME TAXES (2,213,464) (45) (172,312) (2)
r11 INCOME (LOSS) BEFORE DISCONTINUED OPERATIONS (1,967,691) (40) (450,804) (6)
r14 DISCONTINUED OPERATIONS 0 0 0 0
r18 NET CONSOLIDATED LOSS (1,967,691) (40) (450,804) (6)
r19 NET LOSS OF MINORITY INTEREST (475,521) (10) (506,206) (7)
r20 NET (LOSS) INCOME OF MAJORITY INTEREST (1,492,170) (30) 55,402 1


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

QUARTERLY STATEMENTS OF INCOME
BREAKDOWN OF MAIN CONCEPTS
(thousands of Mexican pesos)

AUDITED

REF
R		 CONCEPTS CURRENT YEAR PREVIOUS YEAR
    AMOUNT % AMOUNT %
rt01 NET SALES 4,954,253 100 7,617,888 100
rt21 DOMESTIC 2,128,140 43 2,635,143 35
rt22 FOREIGN 2,826,113 57 4,982,745 65
rt23 TRANSLATED INTO DOLLARS (***) 213,433   338,726  
 
rt08 OTHER INCOME AND (EXPENSE), NET (2,345,808) 100 (56,867) 100
rt49 OTHER INCOME AND (EXPENSE), NET (2,338,546) 100 (41,616) 73
rt34 EMPLOYEES’ PROFIT SHARING EXPENSES 7,262 0 15,251 27
rt35 DEFERRED EMPLOYEES’ PROFIT SHARING 0 0 0 0
 
rt06 COMPREHENSIVE FINANCING RESULT (47,114) 100 58,853 100
rt24 INTEREST EXPENSE 3,148 7 28,070 48
rt42 GAIN (LOSS) ON RESTATEMENT OF UDI’S 0 0 0 0
rt45 OTHER FINANCE COSTS 0 0 0 0
rt26 INTEREST INCOME 9,820 21 25,685 44
rt46 OTHER FINANCIAL PRODUCTS 0 0 0 0
rt25 FOREIGN EXCHANGE GAIN (LOSS), NET (53,786) 114 61,238 104
rt28 RESULT FROM MONETARY POSITION 0 0 0 0
 
rt10 INCOME TAXES (2,213,464) 100 172,312 100
rt32 INCOME TAX (794,416) 36 305,519 177
rt33 DEFERRED INCOME TAX (1,419,048) 64 (477,831) (277)

(***)      THOUSANDS OF DOLLARS
 

MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

QUARTERLY STATEMENTS OF INCOME
OTHER CONCEPTS
(thousands of Mexican pesos)

AUDITED

REF
RT		 CONCEPTS CURRENT YEAR
 PREVIOUS YEAR
    AMOUNT AMOUNT
rt47 OPERATIVE DEPRECIATION AND AMORTIZATION 236,076 465,209


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

STATE OF CASH FLOW (INDIRECT METHOD)
FROM JANUARY 1 TO DECEMBER 31 OF 2009 AND 2008
(thousands of pesos)

AUDITED

REF
C		 CONCEPTS CURRENT YEAR PREVIOUS YEAR
    AMOUNT AMOUNT
 
  ACTIVITIES OF OPERATION    
e01 INCOME (LOSS) BEFORE INCOME TAXES (3,220,514) 2,936,652
e02 + (-) ITEMS NOT REQUIRING CASH 165,573 126,084
e03 + (-) ITEMS RELATED TO INVESTING ACTIVITIES 3,384,918 759,496
e04 + (-) ITEMS RELATED TO FINANCING ACTIVITIES 48,644 57,288
e05 CASH FLOW BEFORE INCOME TAX 378,621 3,879,520
e06 CASH FLOW PROVIDED OR USED IN OPERATION 780,880 (2,034.270)
e07 CASH FLOW PROVIDED OF OPERATING ACTIVITIES
 1,159,501 1,845,250
  INVESTMENT ACTIVITIES    
e08 NET CASH FLOW FROM INVESTING ACTIVITIES (225,517) (9,000,056)
e09 CASH FLOW AFTER INVESTING ACTIVITIES 933,984 (7,154,806)
FINANCING ACTIVITIES    
e10 NET CASH FROM FINANCING ACTIVITIES 438,579 1,334,154
e11 NET (DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS		 1,372,563 (5,820,652)
e12 TRANSLATION DIFFERENCES IN CASH AND CASH
EQUIVALENTS		 (404) 1,238
e13 CASH AND CASH EQUIVALENTS AT THE BEGINNING OF PERIOD 576,741 6,396,155
e14 CASH AND CASH EQUIVALENTS AT THE END OF PERIOD 1,948,900 576,741


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

STATE OF CASH FLOW (INDIRECT METHOD)
BREAKDOWN OF MAIN CONCEPTS
(thousands of pesos)

AUDITED

REF
C		 CONCEPTS CURRENT YEAR PREVIOUS YEAR
    AMOUNT AMOUNT
e02 + (-) ITEMS NOT REQUIRING CASH 165,573 126,084
e15 + ESTIMATES FOR THE PERIOD 0 0
e16 + PROVISIONS FOR THE PERIOD 0 0
e17 + (-) OTHER UNREALIZED ITEMS 165,573 126,084
 
e03 + (-) ITEMS RELATED TO INVESTING ACTIVITIES 3,384,918 759,496
e18 + DEPRECIATION AND AMORTIZATION FOR THE PERIOD 1,047,882 895,306
e19 (-) + GAIN OR LOSS ON SALE PROPERTY, PLANT AND EQUIPMENT 0 0
e20 + IMPAIRMENT LOSS 2,368,000 0
e21 (-) + EQUITY IN RESULTS OF ASSOCIATES AND JOINT VENTURES 0 0
e22 (-) DIVIDENDS RECEIVED 0 0
e23 (-) INTEREST INCOME (30,964) (135,810)
e24 (-) + OTHER ITEMS 0 0
 
e04 + (-) ITEMS RELATED TO FINANCING ACTIVITIES 48,644 57,288
e25 + ACCRUED INTEREST 48,644 57,288
e26 + (-) OTHER ITEMS 0 0
 
e06 CASH FLOW PROVIDED OR USED IN OPERATION 780,880 (2,034,270)
e27 + (-) DECREASE (INCREASE) IN ACCOUNTS RECEIVABLE 630,548 290,082
e28 + (-) DECREASE (INCREASE) IN INVENTORIES 1,864,306 (2,030,274)
e29 + (-)DECREASE (INCREASE) IN OTHER ACCOUNT RECEIVABLES 128,228 (251,920)
e30 + (-) INCREASE DECREASE IN SUPPLIERS (1,338,235) 541,938
e31 + (-)INCREASE DECREASE IN OTHER LIABILITIES (286,682) 111,756
e32 + (-) INCOME TAXES PAID OR RETURNED (217,285) (695,852)
 
e08 NET CASH FLOW FROM INVESTING ACTIVITIES (225,517) (9,000,056)
e33 (-) PERMANENT INVESTMENT IN SHARES 0 (8,450,796)
e34 + DISPOSITION OF PERMANENT INVESTMENT IN SHARES 0 0
e35 (-) INVESTMENT IN PROPERTY PLANT AND EQUIPMENT (263,207) (479,804)
e36 + SALE OF PROPERTY PLANT AND EQUIPMENT 6,114 4,769
e37 (-) INVESTMENT IN INTANGIBLE ASSETS 0 0
e38 + DISPOSITION OF INTANGIBLE ASSETS 0 0
e39 + OTHER PERMANENT INVESTMENTS 0 0
e40 + DISPOSITION OF OTHER PERMANENT INVESTMENTS 0 0
e41 + DIVIDEND RECEIVED 0 0
e42 + INTEREST RECEIVED 30,758 135,810
e43 + (-) DECREASE (INCREASE) ADVANCES AND LOANS TO THIRD PARTS 0 0
e44 + (-) OTHER ITEMS 818 (210,035}
 
e10 NET CASH FROM FINANCING ACTIVITIES 438,579 1,334,154
e45 + BANK FINANCING 0 1,334,129
e46 + STOCK MARKET FINANCING 0 0
e47 + OTHER FINANCING 1,189,850 232,943
e48 (-) BANK FINANCING AMORTIZATION (8,800) (1,325,329)
e49 (-) STOCK MARKET FINANCING AMORTIZATION 0 0
e50 (-) OTHER FINANCING AMORTIZATION (709,219) (36,138)
e51 + (-) INCREASE (DECREASE ) IN CAPITAL STOCK 0 112,269
e52 (-) DIVIDENDS PAID 0 0
e53 + PREMIUM ON ISSUANCE OF SHARES 0 1,056,887
e54 + CONTRIBUTIONS FOR FUTURE CAPITAL INCREASES 0 0
e55 (-) INTEREST EXPENSE (33,252) (40,607)
e56 (-) REPURCHASE OF SHARES 0 0
e57 + (-) OTHER ITEMS 0 0


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

DATE PER SHARE
CONSOLIDATED

AUDITED

REF
D		 CATEGORIES QUARTER OF PRESENT
FINANCIAL YEAR		 QUARTER OF PREVIOUS
FINANCIAL YEAR
 
d01 BASIC PROFIT PER ORDINARY SHARE (**)  $  (0.65)  $   3.70  
d02 BASIC PROFIT PER PREFERRED SHARE (**)   $   0.00    $   0.00  
d03 DILUTED PROFIT PER ORDINARY SHARE (**)   $   0.00    $   0.00  
d04 EARNINGS (LOSS) BEFORE DISCONTINUED OPERATIONS PER
COMMON SHARE (**)		  $  (0.65)  $   3.70  
d05 DISCONTINUED OPERATIONS EFFECT ON EARNING (LOSS) PER SHARE (**)   $   0.00    $   0.00  
d08 CARRYING VALUE PER SHARE $ 35.74 $ 36.53 
d09 CASH DIVIDEND ACCUMULATED PER SHARE  $   0.00    $   0.00  
d10 DIVIDEND IN SHARES PER SHARE                 0.00 shares                 0.00 shares
d11 MARKET PRICE TO CARRYING VALUE              1.02 times              0.62 times
d12 MARKET PRICE TO BASIC PROFIT PER ORDINARY SHARE           (55.93) times              6.12 times
d13 MARKET PRICE TO BASIC PROFIT PER PREFERENT SHARE (**)             0.00 times             0.00 times

(**)      TO CALCULATE THE DATE PER SHARE USE THE NET INCOME FOR THE LAST TWELVE MONTHS.
 

MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

RATIOS
CONSOLIDATED

AUDITED

REF
P		 CATEGORIES QUARTER OF PRESENT
FINANCIAL YEAR		 QUARTER OF PREVIOUS
FINANCIAL YEAR
 
  YIELD    
p01 NET INCOME TO NET SALES (6.11%) 5.40%
p02 NET INCOME TO STOCKHOLDERS’ EQUITY (**) (5.88%) 8.92%
p03 NET INCOME TO TOTAL ASSETS (**) (4.37%) 6.17%
p04 CASH DIVIDENDS TO PREVIOUS YEAR NET INCOME 0.00% 0.00%
p05 INCOME DUE TO MONETARY POSITION TO NET INCOME 0.00% 0.00%
 
  ACTIVITY    
p06 NET SALES TO NET ASSETS (**) 0.72 times 1.14 times
p07 NET SALES TO FIXED ASSETS (**) 1.96 times 3.42 times
p08 INVENTORIES TURNOVER (**) 2.61 times 3.37 times
p09 ACCOUNTS RECEIVABLE IN DAYS OF SALES 34 days 25 days
p10 PAID INTEREST TO TOTAL LIABILITIES WITH COST (**) 6.65% 0.20%
 
  LEVERAGE    
p11 TOTAL LIABILITIES TO TOTAL ASSETS 25.67% 30.86%
p12 TOTAL LIABILITIES TO STOCKHOLDERS’ EQUITY 0.35 times 0.45 times
p13 FOREIGN CURRENCY LIABILITIES TO TOTAL LIABILITIES 36.66% 39.61%
p14 LONG-TERM LIABILITIES TO FIXED ASSETS 0.00% 0.00%
p15 OPERATING INCOME TO INTEREST PAID (16.16) times 54.38 times
p16 NET SALES TO TOTAL LIABILITIES (**) 2.79 times 3.70 times
 
  LIQUIDITY    
p17 CURRENT ASSETS TO CURRENT LIABILITIES 3.07 times 2.48 times
p18 CURRENT ASSETS LESS INVENTORY TO CURRENT LIABILITIES 1.40 times 0.80 times
p19 CURRENT ASSETS TO TOTAL LIABILITIES 1.81 times 1.37 times
p20 AVAILABLE ASSETS TO CURRENT LIABILITIES 47.91% 10.97%

(**)      IN THESE RATIOS FOR THE DATA TAKE INTO CONSIDERATION THE LAST TWELVE MONTHS
 

MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

DIRECTOR REPORT

AUDITED CONSOLIDATED

Year Ended December 31, 2009 compared to Year Ended December 31, 2008

Net Sales

Net sales decreased 45% to Ps. 19,232 million in 2009 (including the net sales generated by the newly acquired plants of Grupo San of Ps. 3,797 million) compared to Ps. 35,185 million in 2008 (including the net sales generated by the newly acquired plants of Grupo San of Ps. 2,532 million). Shipments of finished steel products decreased 30% to 2,046 thousand tons in 2009 (including the net sales generated by the newly acquired plants of Grupo San of 513 thousand tons) compared to 2,924 thousand tons in 2008 (including the net sales generated by the newly acquired plants of Grupo San of 261 thousand tons). Total sales outside of Mexico in 2009 decreased 63% to Ps. 8,935 million (including the net sales generated by the newly acquired plants of Grupo San of Ps. 11 million) compared with Ps. 24,471 million in 2008, (including the net sales generated by the newly acquired plants of Grupo San of Ps. 98 million) while total Mexican sales decreased 4% from Ps. 10,714 million in 2008 (including the net sales generated by the newly acquired plants of Grupo San of Ps. 2,434 million) to Ps. 10,297 millions in 2009 (including the net sales generated by the newly acquired plants of Grupo San of Ps. 3,786 million). The decrease in sales is due to lower shipments during 2009, compared to the same period in 2008 (a 878,000 tons decrease). The average price of steel products decreased 29% in 2009 compared with 2008.

Direct Cost of Sales

Direct cost of sales decreased 41% from Ps. 29,796 million in 2008 (including the cost of sales generated by the newly acquired plants of Grupo San of Ps. 1,444 million) to Ps. 17,717 million in 2009 (including the cost of sales generated by the newly acquired plants of Grupo San of Ps. 2,683 million). Direct cost of sales as a percentage of net sales represented 92% in 2009 compared to 85% in 2008. The average cost of raw materials used to produce steel products decreased 15% in 2009 compared 2008, primarily as a result of decreases in the price of scrap and certain other raw materials.

Marginal Profit

Marginal profit in 2009 was Ps. 1,515 million (including the marginal profit generated by the newly acquired plants of Grupo San of Ps. 1,114 million) compared to Ps. 5,389 million in the same period 2008 (including the marginal profit generated by the newly acquired plants of Grupo San of Ps. 1,010 million). Marginal profit as a percentage of net sales in 2009 was 8% compared to 15% in 2008. The decline in marginal profit is due to lower shipments of 30% during 2009 compared with 2008.

Operating Expenses

Operating expenses increased 1% to Ps. 2,301 million in 2009 (including the operating expenses from the newly acquired plants of Grupo San of Ps. 489 million and the amortization of the tangible and intangible assets of Ps. 359 million registered by the acquisition of Grupo San) compared to Ps. 2,274 million in 2008 (including the operating expenses from the newly acquired plants of Grupo San of Ps. 433 million and the amortization of the tangible and intangible assets of Ps. 270 million registered by the acquisition of Grupo San), and represented 12% of net sales in 2009 and 6% of net sales in 2008.

Operating (Loss) Income

Operating loss was Ps. 786 million in 2009 (including the operating income generated by the newly acquired plants of Grupo San of Ps. 266 million) compared to Ps. 3,115 million of operating income in 2008 (including


the operating income generated by the newly acquired plants of Grupo San of Ps. 655 million). Operating loss as a percentage of net sales was 4% in 2009 compared to 9% of operating income in 2008. The operating loss is due to lower shipments of 30% during 2009 compared with 2008.

Other Expenses (Income) net

The company recorded other income net of Ps. 30 million in 2009 compared to other expense net of Ps. 4 million in 2008.

Impairment of Intangible Assets

In 2009, the Company recognized an impairment of Ps. 2.368 million, which diminished the value of the goodwill of Grupo San and trademark San 42 for Ps. 2.352 million and Ps. 16 million, respectively.

Comprehensive Financial Cost

Comprehensive financial cost in 2009 represented an expense of Ps. 96 million compared with an expense of Ps. 175 million in 2008. Net interest expense was Ps. 18 million in 2009 compared with a net interest income of Ps. 79 million in 2008. At the same time, we registered an exchange loss of Ps. 78 million in 2009 compared with an exchange loss of Ps. 254 million in 2008, reflecting a 3.5% increase in the value of the peso versus the dollar as of December 31, 2009 compared to December 31, 2008.

Income Taxes

Income Taxes recorded an income of Ps. 2,045 million in 2009 (including the decrease in the provision of Ps. 1,404 million of deferred income taxes, and the income tax of Republic Ps. 825 million ) compared to Ps. 1,036 million in 2008 (including the provision of Ps. 293 million of deferred income taxes).

Net Loss (Income)

As a result of the foregoing, net loss was Ps.1,175 million in 2009 compared to net income of Ps. 1,900 million in 2008.

Liquidity and Capital Resources

As of December 31, 2009, Simec’s total consolidated debt consisted of U.S. $302,000 of 8 7/8% medium-term notes (“MTN’s”) due 1998 (accrued interest on December 31, 2009 was U.S. $418,176). As of December 31, 2008, Simec’s total consolidated debt consisted of U.S. $952,000; U.S. $650,000 is a credit bank and U.S. $302,000 of 8 7/8% medium-term notes (“MTN’s”) due 1998 (accrued interest on December 31, 2008 was U.S. $387,882).

Comparative fourth quarter 2009 vs third quarter 2009

Net Sales

Net sales increased 2% from Ps. 5,035 million for the third quarter 2009 to Ps. 4,954 million for the fourth quarter 2009. Sales in tons of finished steel decreased 6% to 518 thousand tons in the fourth quarter 2009 compared with 551 thousand tons in the third quarter 2009. The total sales outside of Mexico for the fourth quarter 2009 increased 20% to Ps. 2,826 million compared with Ps. 2,348 million for the third quarter 2009. Total Mexican sales decreased 21% to 2,090 million in the fourth quarter 2009 from Ps. 2,687 million in the third quarter 2009. The average price of steel products sold in the fourth quarter 2009 increased approximately 5% compared to the third quarter 2009.

Direct Cost of Sales

Direct cost of sales increased 44% from Ps. 4,243 million in the third quarter 2009 to Ps. 6,107 million for the fourth quarter 2009. With respect to sales, in the fourth quarter 2009, the direct cost of sales represents 123%


compared to 84% for the third quarter 2009. The average cost of raw materials used to produce steel products increased 53% in the fourth quarter 2009 versus the third quarter 2009, primarily as a result of increases in the price of scrap and certain other raw materials.

Marginal Loss (Profit)

Marginal loss for the fourth quarter 2009 was Ps. 1,153 million compared to Ps. 792 million of marginal profit in the third quarter 2009. The marginal loss as a percentage of net sales for the fourth quarter 2009 was 23% compared with 16% of marginal profit for the third quarter 2009. The marginal loss is due to the increase in the cost of raw materials used to produce steel products in the fourth quarter 2009 versus the third quarter 2009.

Operating Expenses

Operating expenses increased 18% to Ps. 635 million in the fourth quarter 2009 compared to Ps. 537 million for the third quarter 2009. Operating expenses as a percentage of net sales represented 13% during the fourth quarter 2009 and 11% during the third quarter 2009.

Operating Loss (Income)

Operating loss was Ps. 1,788 million in the fourth quarter 2009 compared to Ps. 255 million of operating income for the third quarter 2009. The operating loss as a percentage of net sales in the fourth quarter 2009 was 36% compared to 5% of operating income in the third quarter 2009. The operating losses due to the increase in the cost of raw materials used to produce steel products in the fourth quarter 2009 versus the third quarter 2009.

Other Expenses (Income) net

The company recorded other income net of Ps. 22 million in the fourth quarter 2009 compared with other income net of Ps. 7 million for the third quarter 2009.

Impairment of Intangible Assets

In the fourth quarter 2009, the Company recognized an impairment of Ps. 2.368 million, which diminished the value of the goodwill of Grupo San and trademark San 42 for Ps. 2.352 million and Ps. 16 million, respectively.

Comprehensive Financial Cost)

Comprehensive financial cost for the fourth quarter 2009 was Ps. 47 million compared with a gain of Ps. 12 million for the third quarter 2009. Net interest income was Ps. 7 million in the fourth quarter 2009 compared with Ps. 13 million of net interest expense in the third quarter 2009. At the same time we registered an exchange loss of Ps. 54 million in the fourth quarter 2009 compared with an exchange gain of Ps. 25 million in the third quarter 2009.

Income Taxes

Income Taxes for the fourth quarter 2009 was an income of Ps. 2,213 million compared to Ps. 7 million of expense for the third quarter 2009.

Net Loss (Income)

As a result of the foregoing, net loss was Ps. 1,968 million in the fourth quarter 2009 compared to Ps. 267 million of net income in the third quarter 2009.


Comparative fourth quarter 2009 vs fourth quarter 2008

Net Sales

Net sales decreased 35% from Ps. 7,618 million for the fourth quarter 2008 to Ps. 4,954 million for the fourth quarter 2009. Sales in tons of finished steel decreased 9% to 518 thousand tons in the fourth quarter 2009 compared with 567 thousand tons in the fourth quarter 2008. The total sales outside of Mexico for the fourth quarter 2009 decreased 43% to Ps. 2,826 million compared with Ps. 4,983 million for the fourth quarter 2008. Total Mexican sales decreased 19% to 2,128 million in the fourth quarter 2009 from Ps. 2,635 million in the fourth quarter 2008. The average price of steel products sold in the fourth quarter 2009 decreased approximately 29% compared to the fourth quarter 2008.

Direct Cost of Sales

Direct cost of sales decreased 17% from Ps. 7,327 million in the fourth quarter 2008 to Ps. 6,107 million for the fourth quarter 2009. With respect to sales, in the fourth quarter 2009, the direct cost of sales represents 123% compared to 96% for the fourth quarter 2008. The average cost of raw materials used to produce steel products decreased 9% in the fourth quarter 2009 compared the fourth quarter 2008, primarily as a result of decreases in the price of scrap and certain other raw materials.

Marginal Loss (Profit)

Marginal loss for the fourth quarter 2009 was Ps. 1,153 million compared to a gain Ps. 291 million in the fourth quarter 2008. The marginal loss as a percentage of net sales for the fourth quarter 2009 was 23% compared with 4% of marginal profit for the fourth quarter 2008. The decline in marginal profit is primarily due to the decrease in the prices of finished products during the fourth quarter 2009 compared with the fourth quarter 2008.

Operating Expenses

Operating expenses decreased 31% to Ps. 635 million in the fourth quarter 2009 compared to Ps. 916 million for the fourth quarter 2008. Operating expenses as a percentage of net sales represented 13% during the fourth quarter 2009 and 12% during the fourth quarter 2008.

Operating Loss

Operating loss was Ps. 1,788 million in the fourth quarter 2009 compared to Ps. 625 million of operating loss for the fourth quarter 2008. The operating loss as a percentage of net sales in the fourth quarter 2009 was 36% compared to operating loss of 8% in the fourth quarter 2008. The operating loss is primarily due to the decrease in the prices of finished products during the fourth quarter 2009 compared with the fourth quarter 2008.

Other Income (Expenses) net

The company recorded other income net of Ps. 22 million in the fourth quarter 2009 compared with other income expense net of Ps. 57 million for the fourth quarter 2008.

Impairment of Intangible Assets

In the fourth quarter 2009, the Company recognized an impairment of Ps. 2.368 million, which diminished the value of the goodwill of Grupo San and trademark San 42 for Ps. 2.352 million and Ps. 16 million, respectively.

Comprehensive Financial Cost

Comprehensive financial cost for the fourth quarter 2009 represented an expense of Ps. 47 million compared with a gain of Ps. 59 million for the fourth quarter 2008. Net interest income was Ps. 7 million in the fourth quarter 2009 compared with Ps. 2 million of net interest expense in the fourth quarter 2008. At the same time we registered an exchange loss of Ps. 54 million in the fourth quarter 2009 compared with an exchange gain of Ps. 61 million in the fourth quarter 2008.


Income Taxes

Income Taxes for the fourth quarter 2009 was an income of Ps. 2,213 million compared to Ps. 172 million of income for the fourth quarter 2008.

Net Loss

As a result of the foregoing, net loss was Ps. 1,968 million in the fourth quarter 2009 compared to Ps. 451 million of net loss in the fourth quarter 2008.

  Year ended
December 31, 2009		 Year ended
December 31, 2008		 2009
vs.
2008
Sales 19,232 35,185 (45%)
Cost of Sales 17,717 29,796 (41%)
Marginal Profit 1,515 5,389 (72%)
Operating Expenses 2,301 2,274 1%
Operating (Loss) Income (786) 3,115 (125%)
EBITDA 262 3,982 (93%)
Net (Loss) Income (1,175) 1,900 (162%)
Sales outside Mexico 8,935 24,471 (63%)
Sales in México 10,297 10,714 (4%)
Total sales (tons) 2,046 2,924 (30%)

(Millions of pesos) 4Q ‘09 3Q ‘09 4Q ‘08 4Q ‘09 vs
3Q ‘09		 4Q ‘09vs
4Q ‘08
Sales 4,954 5,035 7,618 (2%) (35%)
Cost of Sales 6,107 4,243 7,327 44% (17%)
Marginal (Loss) Profit (1,153) 792 291 (246%) (496%)
Operating Expenses 635 537 916 18% (31%)
Operating (Loss) Income (1,788) 255 (625) (801%) 186%
EBITDA (1,552) 522 (160) (397%) 870%
Net (Loss) Income (1,968) 267 (451) (837%) 336%
Sales outside Mexico 2,826 2,348 4,983 20% (43%)
Sales in México 2,128 2,687 2,635 (21%) (19%)
Total sales (tons) 518 551 567 (6%) (9%)

Product Thousands
of tons
Year ended
December 31,
2009		 Million of
pesos
Year
ended
December 31,
2009		 Average
price per
ton
Year ended
December 31,
2009		 Thousands
of tons
Year ended
December 31,
2008		 Million of
pesos
Year ended
December 31,
2008		 Average
price per
ton
Year ended
December 31,
2008
SPECIAL PROFILES 981 10,819 11,029 2,156 27,358 12,689
COMMERCIAL
PROFILES		 1,065 8,413 7,899 768 7,827 10,191
Total 2,046 19,232 9,400 2,924 35,185 12,033


Product Thousands
of tons
4Q ‘09		 Millions of
pesos
4Q ‘09		 Average
price per
ton 4Q ‘09		 Thousands
of tons
3Q ‘09		 Millions
of pesos
3Q ‘09		 Average
price per
ton 3Q ‘09		 Thousands
of tons
4Q ‘08		 Millions
of pesos
4Q ‘08		 Average
price per
ton
4Q ‘08
SPECIAL PROFILES 290 3,281 11,315 260 2,812 10,815 356 5,635 15,830
COMMERCIAL
PROFILES		 228 1,673 7,337 291 2,223 7,640 211 1,983 9,396
Total 518 4,954 9,564 551 5,035 9,138 567 7,618 13,435

Any forward-looking information contained herein is inherently subject to various risks, uncertainties and assumptions which, if incorrect, may cause actual results to vary materially from those anticipated, expected or estimated. The company assumes no obligation to update any forward-looking information contained herein.


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

FINANCIAL STATEMENT NOTES

AUDITED CONSOLIDATED

(1) Operations preparation bases and summary of significant accounting policies:

Grupo Simec, S.A. de C.V. and its Subsidiaries (“the Company”) are subsidiaries of Industrias CH, S.A. de C.V. (“ICH”), and their main activities consist of the manufacturing and sale of steel products primarily destined for the construction sector of Mexico and other countries.

Significant accounting policies and practices followed by the Companies which affect the principal captions of the financial statements are described below:

a. Financial statement presentation – Below is a summary of the most significant accounting policies and practices used in the preparation of the consolidated financial statements, in conformity with Mexican Financial Reporting Standards (MFRS), which include Bulletins and Circulars issued by the Accounting Principles Commission (CPC) of the Mexican Institute of Public Accountants (IMCP) which have not been amended, replaced or abrogated by MFRS issued by the Mexican Financial Reporting Standards Research and Development Board (Consejo Mexicano para la Investigación y Desarrollo de Normas de Información Financiera, A.C. (CINIF)

b. All significant intercompany balances and transactions have been eliminated in consolidation.

c. Cash and cash equivalents – The Company considers short-term investments with original maturities not greater than three months to be cash equivalent. Cash equivalents include temporary investments and Mexican Government Treasury Bonds, and are stated at market value, which approximates cost plus earned interest. Any increase in market value is credited to operations for the period.

d. Inventories – Domestic subsidiaries’ inventories are recorded initially at average cost under the direct costing system. Foreign subsidiaries’ inventories are valued on a last-in, first-out (LIFO). For translation effects into MFRS the inventories have been adjusted from LIFO to average cost under the direct costing system.

Billet finished goods and work in process, raw materials and materials, supplies and rollers - At the average cost.

The Company presents as non-current inventories the rollers and spare parts, which according to historical data and production trends will not be used within a one-year period.

e. Derivative financial instruments – During 2009, 2008 and 2007 the Company used derivative financial instruments for hedging risks associated with natural gas prices for which it conducted studies on historical consumption, future requirement and commitments acquired, thus diminishing its exposure to risks other than its normal operating risks.

To mitigate the risks associated with changes in natural gas prices occurring naturally as a result of the supply and demand on international markets, the Company uses natural gas cash-flow exchange contracts or natural gas swaps to offset fluctuations in the price of natural gas, whereby the Company receives a floating price and pays a fixed price. Fluctuations in natural gas prices from volumes consumed are recognized as part of the Company’s operating cost.


The fair value of these assets or liabilities is restated at the end of each month based on the new estimate. The Company periodically evaluates the changes in cash flows of the derivative instrument to analyze if the swaps are highly effective for mitigating the exposure to natural gas price fluctuations. A hedge instrument is considered to be highly effective when changes in its fair value or cash flows of the primary position are compensated on a regular or cumulatively basis, by changes in fair value or cash flows of the hedging instrument in a range between 80% and 125%. In 2009, 2008 and 2007 the fair value of derivatives that did not qualify for hedge accounting was adjusted through Statement of Income. For the derivatives that qualified for hedge accounting their fair value was adjusted through the Stockholders’ equity in the caption Fair value of derivative financial instruments until such time as the related item the derivative hedges is recognized in income. At that time, the fair value included in Stockholders’ equity is also recognized in income. The Company is using derivative financial instruments for hedging risks associated with natural gas prices and conducted studies on historical consumption, future requirements and commitments; thus it avoided exposure to risks other than the normal operating risks. Management of the Company examines its financial risks by continually analyzing price, credit and liquidity risks.

f. Property, plant and equipment – Property, plant and equipment of domestic origin are restated by using factors derived from The National Consumer Price Index (“NCPI”) from the date of their acquisition, and imported machinery and equipment are restated by applying devaluation and inflation factors of the country of origin, until December 31, 2007. Depreciation recorded in the consolidated statement of income (loss) is computed based upon the estimated useful life and the restated cost of each asset. In addition, Financial expense incurred during the construction period is capitalized as construction in progress. The estimated useful lives of assets as of December 31, 2009 are as follows:

  Years
Buildings 15 to 50
Machinery and equipment 10 to 40
Buildings and improvements (Republic)  10 to 25
Land improvements (Republic) 5 to 25
Machinery and equipment (Republic) 5 to 20

g. Other assets – Organization and pre-operating expenses are capitalized and and their amortization is calculated by the straight-line method over a period of 20 years.

h. Seniority premiums and severance payments – According to Federal Labor Law, employees are entitled to seniority premiums after fifteen years or more of services. These premiums are recognized as expenses in the years in which the services are rendered, using actuarial calculations based on the projected unit credit method, and since 1996 by applying real interest and salary increases.

Any other payments to which employees may be entitled in case of separation, disability or death, are charged to operations in the period in which they become payable.

i. Pension plan – Until 1995, the Company provided pension benefits for all personnel with a minimum of 10 years of service and 35 years of age. The Company had established an irrevocable trust for its contributions, which were based on actuarial calculations. In December 1995, the board of directors of the Company, in agreement with the trade union, discontinued these benefits and related contributions to the trust fund. This decision was made because of the new Mexican pension fund system, Administradoras de Fondos para el Retiro, which establishes similar benefits for the employees. The balance of the trust fund will be applied to the retirement benefits of qualifying employees until the fund is exhausted due to the irrevocable status of the fund.

The Company does not have any contractual obligation regarding the payment of pensions of retirements.


j. Income taxes – In 1999, the Mexican Institute of Public Accountants issued Bulletin D-4, “Accounting for Income and Asset Taxes and Employee Profit Sharing”, which is effective for all fiscal years beginning January 1, 2000. Bulletin D-4 establishes financial accounting and reporting standards for the effects of asset tax, income tax and employee profit sharing that result from enterprise activities during the current and preceding years.

The Company and its subsidiaries are included in the consolidated tax returns of the company’s parent.

k. Foreign currency transactions and exchange differences – All transactions in foreign currency are recorded at the exchange rates prevailing on the date of their execution or liquidation. Foreign currency denominated assets and liabilities are translated at the exchange rates prevailing at the balance sheet date. Any exchange differences incurred with regard to assets or liabilities denominated in foreign currency are charged to operations of the period and are included in financial income (expense) in the accompanying consolidated statements of income (loss).

For consolidation purposes, the financial statements of the foreign subsidiaries, were translated into pesos in conformity with Mexican accounting Bulletin MFRS B-15, Transactions in Foreign Currency.

The first step in the process of conversion of financial information of the operations is the determination of the functional currency, which is in first instance the currency of primary the economic surroundings of the foreign operation; nevertheless, despite the previous thing, the functional currency can differ from the premises or registry, in the measurement that this one does not represent the currency that fundamentally affects the cash flow of the operations abroad. The financial statements of the foreign subsidiaries were turned to Mexican pesos with the following procedure:

– Applying the prevailing exchange rate at the consolidated balance date for monetary assets and liabilities.

– Applying the prevailing historical exchange rate for nonmonetary assets and liabilities and for stockholders’ equity accounts.

– Applying the prevailing the historical exchange rate at the consolidated balance sheet date for revenues and expenses during the reporting period

– The resulting effect of translation, the process of consolidation and to apply the participation method, is recorded in stockholders’ equity under the accumulated effect by conversion forming part of the Comprehensive Income.

l. Geographic concentration of credit risk – The Company sells its products primarily to distributors for the construction industry with no specific geographic concentration. Additionally, no single customer accounted for a significant amount of the Company’s sales, and there were no significant accounts receivable from a single customer or affiliate at December 31, 2009 sales to five customers accounted for approximately 26% of the Republic’s sales. The Company performs evaluations of its customers’ credit histories and establishes and allowance for doubtful accounts based upon the credit risk of specific customers and historical trends.

m. Other income (expenses) – Other income (expenses) shown in the consolidated statements of operations primarily includes other financial operations.

(2) Financial Debt:

As of December 31, 2009, Simec’s total consolidated debt consisted of U.S. $302,000 of 8 7/8% medium-term notes (“MTN’s”) due 1998 (accrued interest on December 31, 2009 was U.S. $418,176). As of December 31, 2008, Simec’s total consolidated debt consisted of U.S. $952,000; U.S. $650,000 is a credit bank and U.S. $302,000 of 8 7/8% medium-term notes (“MTN’s”) due 1998 (accrued interest on December 31, 2008 was U.S. $387,882).


(3) Commitments and contingent liabilities:

a. Pacific Steel, Inc. (a wholly-owned subsidiary located in the U.S.A.) has been named in various claims and suits relating to the generation, storage, transport, disposal and cleanup of materials classified as hazardous waste. The Company has accrued approximately Ps. 6,155 (U.S. $471,298) at December 31, 2009, (included in accrued liabilities) relating to these actions; the reduction of this reserve from previous levels reflects clean-up activities undertaken by Simec. Management believes the ultimate liability with respect to this matter will not exceed the amounts that have been accrued.

b. The Company is subject to various other legal proceeding and claims, which have arisen, in the ordinary course of its business. It is the opinion of management that their ultimate resolution will not have a material adverse effect on the Company’s consolidated financial position or consolidated results of operations.


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

RELATIONS OF SHARES INVESTMENTS

CONSOLIDATED

AUDITED

COMPANY NAME MAIN ACTIVITIES NUMBER OF
SHARES		 OWNERSHIP
SUBSIDIARIES      
Cia Siderurgica de Guadalajara Production and sales of steel products   99.99
Simec International Production and sales of steel products   99.99
Arrendadora Simec Production and sales of steel products   100.00
Undershaft Sub-Holding   100.00
Pacific Steel Scrap purchase   100.00
Cia. Siderúrgica del Pacífico Rent of land   99.99
Coordinadora de Servicios Siderúrgicos de Calidad Administrative services   100.00
Comercializadora Simec Sales of steel products   99.99
Industrias del Acero y del Alambre Sales of steel products   99.99
Procesadora Mexicali Scrap purchase   99.99
Servicios Simec Administrative services   100.00
Sistemas de Transporte de Baja California Freight services   100.00
Operadora de Metales Administrative services   100.00
Operadora de Servicios Siderúrgicos de Tlaxcala Administrative services   100.00
Administradora de Servicios Siderúrgicos de Tlaxcala Administrative services   100.00
Operadora de Servicios de la Industria Siderúrgica Administrative services   100.00
SimRep Sub-Holding   50.22
Republic Engineered Products Production and sales of steel products   50.22
CSG Comercial Sales of steel products   99.95
Comercializadora de Aceros de Tlaxcala Sales of steel products   99.95
Siderúrgica de Baja California Sales of steel products   99.95
Corporación Aceros DM Sub-Holding   99.99
Productos Siderurgicos de Tlaxcala Sales of steel products   100.00
Comercializadora MSAN Sales of steel products   100.00
Comercializadora Aceros DM Sales of steel products   100.00
Promotora de Aceros San Luis Sales of steel products   100.00
Arrendadora Norte de Matamoros Land   85.00
Procesadora Industrial Administrative services   99.99
Acero Transporte San Freight services   100.00
Simec International 2 Production and sales of steel products   99.99
Simec International 3 Production and sales of steel products   99.99
Simec International 4 Production and sales of steel products   99.99
Simec International 5 Production and sales of steel products   99.99
Simec Acero Sales of steel products   100.00
Simec USA Sales of steel products   100.00
Pacific Projects Administrative services   100.00
TOTAL INVESTMENT IN SUBSIDIARIES      
ASSOCIATEDS      
      0
TOTAL INVESTMENT IN ASSOCIATEDS     0
OTHER PERMANENT INVESTMENTS     0.00
TOTAL     0

NOTES


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

CREDITS BREAK DOWN
(THOUSANDS OF MEXICAN PESOS)

CONSOLIDATED

AUDITED

      Denominated in Pesos
(Thousands of Pesos)		 Denominated in Foreign Currency
(Thousands of Pesos)
Credit Type /
Institution		 Amorti-
zation
Date		 Rate
of
Interest		 Time Interval Time Interval
      Current
Year		 Until
1
Year		 Until
2
Years		 Until
3
Years		 Until
4
Years		 Until 5
Years
or
More		 Current
Year		 Until
1
Year		 Until
2
Years		 Until
3
Years		 Until
4
Years		 Until 5
Years
or
More
BANKS                            
With
Warranty		     0 0 0 0 0 0 0 0 0 0 0 0
      0 0 0 0 0 0 0 0 0 0 0 0
 
TOTAL
BANKS		     0 0 0 0 0 0 0 0 0 0 0 0
 
 
LISTED IN
THE
STOCK
EXCHANGE		                            
 
UNSECURED
DEBT		                            
 
                             
Medium Term
Notes		 15/12/1998 9.33 0 0 0 0 0 0 0 3,944 0 0 0 0
 
 
TOTAL
STOCK
EXCHANGE		     0 0 0 0 0 0 0 3,944 0 0 0 0
 
 
SUPPLIERS                            
 
Various     0 517,546 0 0 0 0 0 1,379,279 0 0 0 0
 
TOTAL
SUPPLIERS		     0 517,546 0 0 0 0 0 1,379,279 0 0 0 0
 
OTHER
LOANS WITH
COST		                            
 
 
Various                   740,285        
TOTAL     0 0 0 0 0 0 0 740,285 0 0 0 0


OTHER
CURRENT
LIABILITIES
WITHOUT
COST		                            
Various       0 685,544 0 0 0 0 0 406,827 0 0 0 0
TOTAL     0 685,544 0 0 0 0 0 406,827 0 0 0 0
 
 
TOTAL     0 1,203,090 0 0 0 0 0 2,530,335 0 0 0 0

NOTES: The exchange rate of the peso to the U.S. Dollar at December 31, 2009 was Ps. 13.0587


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

MONETARY FOREIGN CURRENCY POSITION
(Thousands of Mexican Pesos)

CONSOLIDATED

AUDITED

  DOLLARS OTHER CURRENCIES TOTAL
FOREIGN CURRENCY POSITION THOUSANDS
OF DOLLARS		 THOUSANDS
OF PESOS		 THOUSANDS
OF DOLLARS		 THOUSANDS
OF PESOS		 THOUSANDS
OF PESOS
 
 
TOTAL ASSETS 286,062 3,735,601 0 0 3,735,601
 
LIABILITIES POSITION 193,621 2,528,441 145 1,894 2,530,335
SHORT TERM LIABILITIES POSITION 193,621 2,528,441 145 1,894 2,530,335
LONG TERM LIABILITIES POSITION 0 0 0 0 0
 
NET BALANCE 92,441 1,207,160 (145) (1,894) 1,205,266

NOTES

THE EXCHANGE RATE OF THE PESO TO THE U.S. DOLLAR AT DECEMBER 31, 2009 WAS PS. 13.0587


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

DEBT INSTRUMENTS

CONSOLIDATED

AUDITED

FINANCIAL LIMITED BASED IN ISSUED DEED AND/OR TITLE

MEDIUM TERM NOTES

    A)      Current assets to current liabilities must be 1.0 times or more.
 
  B)      Total liabilities to total assets do not be more than 0.60.
 
  C)      Operating income plus items added to income which do not require using cash must be 2.0 times or more.
     
  This notes was offered in the international market.

ACTUAL SITUATION OF FINANCIAL LIMITED

  MEDIUM TERM NOTES
     
    A)      Accomplished the actual situation is 3.07 times.
 
  B)      Accomplished the actual situation is 0.26
 
  C)      Accomplished the actual situation is 5.38
     
  As of December 31, 2009, the remaining balance of the MTNs not exchanged amounts to Ps. 3,944 ($302,000 dollars).
   
  C.P. José Flores Flores
Chief Financial Officer

BONDS AND/OR MEDIUM TERM NOTES CERTIFICATE


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

PLANTS, COMMERCE CENTERS OR DISTRIBUTION CENTERS

CONSOLIDATED

AUDITED

PLANT OR CENTER ECONOMIC ACTIVITY PLANT
CAPACITY		 UTILIZATION (%)
GUADALAJARA MINI MILL PRODUCTION AND SALES OF STEEL
PRODUCTS		 480 76.04
MEXICALI MINI MILL PRODUCTION AND SALES OF STEEL
PRODUCTS		 250 74.04
APIZACO AND CHOLULA PLANTS PRODUCTION AND SALES OF STEEL
PRODUCTS		 460 73.38
CANTON CASTER FACILITY PRODUCTION OF BILLET 1,380 46.50
LORAIN CASTER FACILITY PRODUCTION OF BILLET 1,150 0.00
LORAIN HOT-ROLLING MILL PRODUCTION AND SALES OF STEEL
PRODUCTS		 840 32.40
LACKAWANNA HOT-ROLLING MILL PRODUCTION AND SALES OF STEEL
PRODUCTS		 600 48.70
MASSILLON COLD-FINISH FACILITY PRODUCTION AND SALES OF STEEL
PRODUCTS		 125 46.00
GARY COLD-FINISH FACILITY PRODUCTION AND SALES OF STEEL
PRODUCTS		 70 26.70
ONTARIO COLD-FINISH FACILITY PRODUCTION AND SALES OF STEEL
PRODUCTS		 60 44.30
SAN LUIS POTOSI COLD-FINISH FACILITY PRODUCTION AND SALES OF STEEL
PRODUCTS		 600 85.47


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

MAIN RAW MATERIALS

CONSOLIDATED

AUDITED

DOMESTIC MAIN SUPPLIERS FOREIGN MAIN SUPPLIERS DOMESTIC
SUBSTITUTION		 COST
PRODUCTION (%)
PLANTS IN USA   SCRAP VARIOUS NO 34.60
SCRAP VARIOUS PLANTS IN MEXICO     55.60
FERROALLOYS VARIOUS PLANTS IN MEXICO   YES 7.75
PLANTS IN USA   FERROALLOYS VARIOUS NO 6.10
ELECTRODES VARIOUS PLANTS IN MEXICO VARIOUS YES 2.85
PLANTS IN USA   ELECTRODES VARIOUS NO 2.70


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

SELLS DISTRIBUTION BY PRODUCT

CONSOLIDATED

DOMESTIC SALES

AUDITED

MAIN PRODUCTS NET SALES MAIN DESTINATION
  VOLUME AMOUNT TRADEMARKS CUSTOMERS
COMMERCIAL PROFILES 934 7,248,534    
SPECIAL PROFILES 356 3,048,300    
 
 
T O T A L   10,296,834    
 
FOREIGN SALES   8,934,695    
TOTAL   19,231,529    


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

SELLS DISTRIBUTION BY PRODUCT

CONSOLIDATED

FOREIGN SALES

AUDITED

MAIN PRODUCTS NET SELLS MAIN
  VOLUME AMOUNT TRADEMARKS CUSTOMERS
EXPORTS        
COMMERCIAL PROFILES 66 536,771    
SPECIAL PROFILES 54 533,175    
 
 
FOREIGN SUBSIDIARIES        
SPECIAL PROFILES 637 7,864,749    
 
TOTAL   8,934,695    


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

CONSTRUCTION IN PROGRESS

CONSOLIDATED

AUDITED

THE PROJECTS IN PROGRESS AT DECEMBER 31, 2009, ARE:

PROJECTS IN PROGRESS TOTAL INVESTMENT
   
PROJECTS IN REPUBLIC 250,636
PROJECTS IN MEXICALI 4,291
PROJECTS IN TLAXCALA 67,194
PROJECTS IN GUADALAJARA 16,929
PROJECTS IN SAN LUIS POTOSI 20,467
 
TOTAL INVESTMENT AT  
DECEMBER 31, 2009 359,517
 


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

TRANSACTIONS IN FOREIGN CURRENCY AND CONVERSION OF FINANCIAL STATEMENTS OF FOREIGN OPERATIONS
INFORMATION RELATED TO BULLETIN B-15

CONSOLIDATED

AUDITED

Foreign currency transactions and exchange differences – Transactions in foreign currencies are recorded at the exchange rates prevailing at the celebration and liquidation dates. The assets and liabilities in foreign currencies are translated at the exchange rates prevailing at the date of the consolidated balance sheet. The exchange gains or losses incurred in connection with those assets or liabilities are included in the Statement of income, as part of the comprehensive financing cost. Note 3 presents the consolidated position in foreign currencies at the end of each year and the exchange rates used in the translation.

The functional and reporting currency of the Company is the Mexican peso. The financial statements of foreign subsidiaries were translated to Mexican pesos in accordance with the New Mexican Financial Reporting Standard MFRS B-15 "Conversion of foreign currencies” that came into effect on January 1, 2008. Under this Standard, the first step to convert financial information from operations abroad is the determination of the functional currency. The functional currency is the currency of the primary economic environment of the foreign operation or, if different, the currency that mainly impacts its cash flows. The new rule incorporates the concepts of recording currency that is the currency in which the entity maintains its accounting records, whether for legal or information purposes and the reporting currency, which is the currency chosen by the Company to report its financial information.

The U.S. dollar was considered as the functional currency of the subsidiary SimRep, therefore the financial statements of this subsidiary were translated into Mexican pesos by applying: i) the exchange rates at the balance sheet date to all assets and liabilities and (ii) the historical exchange rate at stockholders’ equity accounts and revenues, costs and expenses. The difference resulting from the translation or consolidation processes or from applying the equity method, is recognized as a cumulative translation adjustment as part of Translation effect in foreign subsidiaries in Stockholders’ equity.

The Mexican Peso was considered the functional currency of the subsidiary Pacific Steel and the U.S. dollar as its recording currency; therefore the financial statements were translated to Mexican pesos as follows: i) monetary assets and liabilities by applying the exchange rates at the balance sheet date; ii) non-monetary assets and liabilities, as well as stockholders’ equity accounts, at the historical exchange rate; and iii) revenues, costs and expenses at the historical exchange rate. Translation differences were carried directly to the income statement under the caption Foreign exchange loss, net.


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

CONSOLIDATED

INTEGRATION OF THE PAID SOCIAL CAPITAL STOCK
CHARACTERISTICS OF THE SHARES

AUDITED

SERIES NOMINAL
VALUE		 VALID
COUPON		   NUMBER OF SHARES   CAPITAL STOCK
(Thousands of Pesos)
      FIXED
PORTION		 VARIABLE
PORTION		 MEXICAN FREE
SUBSCRIPTION		 FIXED VARIABLE
B     90,850,050 406,859,164 0 497,709,214 441,786 1,978,444
TOTAL     90,850,050 406,859,164 0 497,709,214 441,786 1,978,444

TOTAL NUMBER OF SHARES REPRESENTING THE PAID-IN CAPITAL STOCK ON THE DATE OF SENDING THE INFORMATION: 497,709,214


MEXICAN STOCK EXCHANGE
SIFIC / ICS

STOCK EXCHANGE CODE: SIMEC QUARTER: 4 YEAR: 2009
GRUPO SIMEC, S.A.B. DE C.V.  

CONSOLIDATED

AUDITED

DECLARATION OF THE COMPANY OFFICIALS RESPONSIBLE FOR THE INFORMATION CONTAINED IN THIS REPORT.

LUIS GARCIA LIMON AND JOSE FLORES FLORES CERTIFY THAT BASED ON OUR KNOWLEDGE, THIS REPORT DOES NOT CONTAIN ANY UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT TO STATE A MATERIAL FACT NECESSARY TO MAKE THE STATEMENTS MADE HEREIN, IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH SUCH STATEMENTS WERE MADE, NOT MISLEADING WITH RESPECT TO THE PERIOD COVERED BY THIS FOURTH QUARTER REPORT.

ING LUIS GARCIA LIMON C.P. JOSE FLORES FLORES
CHIEF EXECUTIVE OFFICER CHIEF FINANCIAL OFFICER

GUADALAJARA, JAL, AT APRIL 29 OF 2010.