The multinational nature of our transactions, operations and customer base expose us to a variety of risks, including the effects of changes in interest rates, foreign currency exchange rates and commodity prices. We selectively manage these exposures through the use of derivative instruments to mitigate market risk and interest rate costs. In addition, we may use derivative instruments embedded in investment instruments, in compliance with Ternium’s policy for financial investments. We do not use derivative financial instruments for other purposes. In addition, in the ordinary course of business we also face risks with respect to financial instruments that are either non-financial or non-quantifiable. Such risks principally include country risk and credit risk and are not presented in the following analysis. For additional information about our financial risk management, see note 29 to the consolidated financial statements included in this annual report. The following tables provide a breakdown of Ternium’s debt instruments as of December 31, 2025, by type of interest rate fixing mechanism and year of maturity. The following information should be read together with note 29 “Financial Risk Management” to the consolidated financial statements included in this annual report. At December 31, 2025 Expected maturity in the year ending December 31, In $ million 2026 2027 2028 and thereafter Total Non-current Debt Fixed Rate — — — — Floating Rate — 297 395 692 Bonds — — 485 485 Debentures — — 638 638 Current Debt Fixed Rate 267 — — 267 Floating Rate 304 — — 304 Bonds 16 — — 16 Debentures 18 — — 18 Total (1) (2) 604 297 1,517 2,419 As most borrowings and the debentures incorporate floating rates that approximate market rates and the contractual repricing occurs mostly every 1 month, the fair value of the borrowings and the debentures approximates their carrying amount and it is not disclosed separately. Fixed rate borrowings are uncommitted short-term revolving loans, and their fair value approximates to their carrying amount. Regarding the bonds, its fair value approximates the market value. 128 The weighted average interest rate as of December 31, 2025 was 5.45% for bank borrowings, 7.50% for bonds and 16.17% for debentures, which were 52%, 21% and 27% of our total borrowings, respectively. The total weighted average interest rate for 2025 was 9.17%. These figures incorporate instruments denominated mainly in U.S. dollars and Brazilian Reais, and do not include the effect of derivative financial instruments nor the devaluation of local currencies. Total Debt by Currency as of December 31, 2025 $ million U.S. dollar ($) 1,700 Brazilian Real (BRL) 655 Colombian Peso (COP) 57 Other 7 Total 2,419 Foreign Exchange Exposure Risk Ternium operates and sells its products in different countries, and as a result is exposed to foreign exchange rate volatility. Ternium’s subsidiaries may use derivative contracts in order to hedge their exposure to exchange rate risk derived from their trade and financial operations. A significant portion of Ternium’s business is carried out in currencies other than the U.S. dollar, Ternium’s reporting currency. As a result of this foreign currency exposure, exchange rate fluctuations impact Ternium’s results as reported in its income statement and statement of comprehensive income in the form of both translation and transaction risk. Translation risk is the risk that Ternium’s consolidated financial statements for a particular period or as of a certain date may be affected by changes in the prevailing rates of the various functional currencies of the reporting subsidiaries against the U.S. dollar. Transaction risk is the risk that the value of transactions executed in currencies other than the subsidiary’s functional currency may vary according to currency fluctuations. Ternium’s foreign exchange policy seeks to minimize the impact of fluctuations in the value of other currencies with respect to the U.S. dollar, with the exception of the currencies of countries where it has operations in Latin America, in which Ternium may, from time to time, choose not to hedge operational short exposures to such currencies. Ternium’s subsidiaries, with the exception of Usiminas, monitor their actual and expected short-term net cash flows in currencies other than the U.S. dollar and analyze potential hedging according to its needs in line with its derivative policy. Usiminas and its subsidiaries monitor their net operating cash flows in currencies other than the Brazilian real and analyse potential hedging strategies according to its exposure to the Brazilian real. This hedging can be carried out either by netting positions or by financial derivatives. However, regulatory or legal restrictions in the countries in which Ternium’s subsidiaries operate, could limit the possibility of the company carrying out its hedging policy. The functional currency of Ternium Mexico, Ternium Argentina, Ternium Brazil, Ternium Colombia, Ternium Guatemala and Tenigal is the U.S. dollar. In addition, Usiminas, which we began to consolidate in July 2023, has adopted the U.S. dollar as its functional currency for its financial statements from January 1, 2026. The functional currency of Usiminas for its financial statements for the years 2023, 2024 and 2025 was the Brazilian real. The following table shows a breakdown of Ternium’s assessed financial position exposure to currency risk as of December 31, 2025, for subsidiaries using the U.S. dollar as functional currency as of that date. Exposure to: $ million Mexican peso (MXN) (638) Brazilian real (BRL) (427) Colombian peso (COP) (25) Argentine peso (ARS) 34 EU euro (EUR) (102) Other currencies (3) 129 The following table shows a breakdown of Ternium’s assessed financial position exposure to currency risk as of December 31, 2025 for subsidiaries using the Brazilian real as functional currency as of that date. Exposure to: $ million U.S. dollar ($) (39) E.U. euro (EUR) (2) Other currencies (0) The exposure sensitivities to the Mexican peso, Brazilian real, Colombian peso and Argentine peso are the following: (a) Mexican peso vs. U.S. dollar. If the Mexican peso had weakened by 1% against the U.S. dollar, it would have generated a pre-tax gain of $6.3 million and $8.0 million as of December 31, 2025 and 2024, respectively. (b) Brazilian real vs. U.S. dollar. If the Brazilian real had weakened by 1% against the U.S. dollar, it would have generated a pre-tax loss of $0.6 million and $3.0 million as of December 31, 2025 and 2024, respectively. (c) Colombian peso vs. U.S. dollar. If the Colombian peso had weakened by 1% against the U.S. dollar, it would have generated a pre-tax gain of $0.2 million and $0.6 million as of December 31, 2025 and 2024, respectively. (d) Argentine peso vs. U.S. dollar. If the Argentine peso had weakened by 1% against the U.S. dollar, it would have generated a pre-tax loss of $0.3 million and $0.2 million as of December 31, 2025 and 2024, respectively. We estimate that if the Mexican peso, the Brazilian real, the Colombian peso and the Argentine peso had weakened simultaneously by 1% against the U.S. dollar with all other variables held constant, total pre-tax gain for 2025 would have been $5.6 million higher, as a result of foreign exchange gains/losses on translation of U.S. dollar-denominated financial positions, local currency cash, trade receivables, trade payables, tax credits and liabilities, lease liabilities, borrowings and other liabilities. Considering the same variation of the currencies against the U.S. dollar of all net investments in foreign operations amounting to $2.7 billion, the currency translation adjustment included in total equity would have been $6.3 million higher, arising mainly from the adjustment on translation of the equity related to the Brazilian real during the year 2025. The following table shows a breakdown of Ternium’s financial position exposure to currency risk as of December 31, 2025, for subsidiaries using the U.S. dollar as functional currency as of that date, including Usiminas on a pro forma basis. Exposure to: $ million Mexican peso (MXN) (638) Brazilian real (BRL) (489) Colombian peso (COP) (25) Argentine peso (ARS) 34 EU euro (EUR) (104) Other currencies (3) Including Usiminas on a pro forma basis, if the Brazilian real had weakened by 1% against the U.S. dollar as of December 31, 2025, it would have generated a pre-tax loss of $0.4 million. Foreign Exchange Contracts During 2025, 2024 and 2023, Ternium Mexico entered into several forward agreements mainly to manage the exchange rate exposure generated by future payables in EUR related to the investment plan in Pesquería, Mexico, among other standard liabilities in EUR. The outstanding notional amount hedged as of December 31, 2025, was EUR208.9 million. These agreements will be due up to August 2026 and have been accounted for as cash flow hedges. As of December 31, 2025, the aggregate notional amount on these agreements amounted to $242.7 million. 130 In addition, during 2025 and 2024 Ternium Mexico entered into multiple non-deliverable forward agreements to manage the exposure arising from future payables in MXN linked to the investment plan in Pesquería, Mexico, seeking to mitigate the impact of exchange rate volatility on the budget assigned for the investment. These agreements will be settled in June 2027 and have been accounted for as cash flow hedges. As of December 31, 2025, their notional value amounted to $344.5 million. Furthermore, during 2024 Ternium Mexico entered into non-deliverable forward agreements to manage the exchange rate exposure generated by future payables in JPY related to the investment plan in Pesquería, Mexico. These agreements were due up to August 2025; therefore, as of December 31, 2025, there were no outstanding amounts. Occasionally, Ternium Colombia S.A.S. can enter into non-deliverable forward agreements to manage the aggregate exposure arising from its balance sheet position in conjunction with expected off balance future trade receivables denominated in its local currency. The last agreements were due up November 2025; consequently, as of December 31, 2025, there were no outstanding amounts. Since 2023, Ternium Guatemala entered into several non-deliverable forward agreements in order to manage the exchange rate exposure generated primarily by trade receivables denominated in Guatemalan quetzals. As of December 31, 2025, the notional amount on these agreements amounted to $2.0 million, which were settled in January 2026. From time to time, Ternium del Atlántico can enter into several non-deliverable forward agreements to manage the aggregate exposure arising from its balance sheet position in conjunction with expected off balance future trade receivables denominated in Colombian pesos. These agreements were due up to January 2025; consequently, as of December 31, 2025, there were no outstanding amounts. Ternium Procurement has, on occasion, entered into forward agreements in order to manage the exchange rate exposure generated by purchases of semi-finished steel products. As of December 31, 2025, there were no outstanding amounts. During 2024 and 2025, Ternium Argentina conducted forward agreements as a strategy to convert financing rates in Argentine pesos to competitive $ rates through cross currency transactions, enhancing its overall financial costs. As of December 31, 2025, there were no outstanding amounts. During 2025, Ternium Brasil entered into several non-deliverable forward agreements in order to manage the exchange rate exposure generated primarily by trade payables and capital expenditures denominated in EUR. As of December 31, 2025, the notional amount on these agreements amounted to $10.0 million, which settled on January 30, 2026. The consolidated net fair value of the exchange rate derivative contracts as of December 31, 2025, was positive $42.5 million. For further information on our foreign exchange contracts see note 22(b) to the consolidated financial statements included in this annual report. Interest Rate Exposure Risk Ternium manages its exposure to interest rate volatility through its financing alternatives and hedging instruments. Borrowings issued at variable rates expose the company to the risk of increased interest expense in the event of a raise in market interest rates, while borrowings issued at fixed rates expose the company to a variation in its fair value. The company’s interest-rate risk mainly arises from long-term borrowings that bear variable-rate interest that could be partially fixed through different derivative transactions, such as interest rate swaps. The weighted average interest rate as of December 31, 2025 was 5.45% for bank borrowings, 7.50% for bonds and 16.17% for debentures, which were 52%, 21% and 27% of our total borrowings, respectively. These figures incorporate instruments denominated mainly in U.S. dollars and Brazilian Reais, and do not include the effect of derivative financial instruments nor the devaluation of local currencies.. Ternium’s total variable interest rate debt amounted to $1,651.0 million (68.3% of total borrowings) as of December 31, 2025, and $1,140.1 million (51.1% of total borrowings) as of December 31, 2024. If interest rates on the aggregate average notional of U.S. dollar denominated borrowings held during 2025, excluding borrowings with derivatives 131 contracts mentioned in note 22(a), had been 100 basis points higher with all other variables held constant, total pre-tax income for 2025 would have been $22.8 million lower ($21.1 million lower as of December 31, 2024). Commodity Exposure Risk Since 2023, Ternium Mexico has entered into swap agreements to mitigate the impact of zinc price fluctuations affecting the manufacturing cost of galvanized products to be sold with a fixed zinc price. As of December 31, 2025, Ternium Mexico has several agreements outstanding with an aggregate notional amount of $2.8 million. During 2025, 2024 and 2023, Mineração Usiminas, one of Usiminas’ subsidiaries, entered into forward agreements to manage the impact of the fluctuation of iron ore prices affecting its sales in the foreign market. As of December 31, 2025, Mineração Usiminas has several agreements outstanding with an aggregate notional amount of $26.9 million. These transactions are accounted for as cash flow hedges.