Ternium S.A. - Interim / Quarterly Report 2008

FORM 6 - K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Private Issuer

Pursuant to Rule 13a - 16 or 15d - 16 of

the Securities Exchange Act of 1934

As of 5/5/2008

Ternium S.A.

(Translation of Registrant's name into English)

Ternium S.A.

46a, Avenue John F. Kennedy

L-1855 Luxembourg

(Address of principal executive offices)

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

Form 20-F ü Form 40-F ¨

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 ü

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

Not applicable

The attached material is being furnished to the Securities and Exchange Commission pursuant to Rule 13a-16 and Form 6-K under the Securities Exchange Act of 1934, as amended.

This report contains Ternium S.A.’s consolidated financial statements as of March 31, 2008.

SIGNATURE

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

TERNIUM S.A.

By:	/s/ Roberto Philipps	By:	/s/ Daniel Novegil
Name:	Roberto Philipps	Name:	Daniel Novegil
Title:	Chief
Financial Officer	Title:	Chief
Executive Officer

Dated: May 5, 2008

TERNIUM S.A.

CONSOLIDATED CONDENSED INTERIM

FINANCIAL STATEMENTS AS OF MARCH 31, 2008

AND FOR THE THREE-MONTH PERIODS

ENDED MARCH 31, 2008 AND 2007

46a, Avenue John F. Kennedy, 2 nd floor

L – 1855

R.C.S. Luxembourg : B 98 668

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of Ternium S.A.:

We have reviewed the accompanying consolidated condensed balance sheet of Ternium S.A. and its subsidiaries as of March 31, 2008, and the related consolidated condensed statements of income and of changes in shareholders’ equity for the three-month periods ended March 31, 2008 and 2007 and the consolidated condensed statements of cash flows for the three-month periods ended March 31, 2008 and 2007. These interim financial statements are the responsibility of the Company’s management.

We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should be made to the accompanying consolidated condensed interim financial statements for them to be in conformity with International Financial Reporting Standards.

As further explained in Note 14, in April 2008 the Government of Venezuela announced its intention to nationalize Ternium’s Venezuelan subsidiary, Sidor C.A. At the date of issue of these financial statements it is not possible to foresee the final outcome of this situation and its impact on the financial statements of Ternium S.A., if any.

We previously audited in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet as of December 31, 2007, and the related consolidated statements of income, of changes in shareholders’ equity and of cash flows for the year then ended (not presented herein), and in our report dated February 26, 2008 we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet information as of December 31, 2007, is fairly stated in all material respects in relation to the consolidated balance sheet from which it has been derived

Buenos Aires, Argentina

May 5, 2008

| PRICE

WATERHOUSE & CO. S.R.L.
by	(Partner)
Marcelo
D. Pfaff

TERNIUM S.A.

Consolidated condensed interim financial statements as of March 31, 2008

and for the three-month periods ended March 31, 2008 and 2007

(All amounts in USD thousands)

CONSOLIDATED CONDENSED INTERIM INCOME STATEMENTS

| | Notes | Three-month period ended March 31, — 2008 | 2007 | | | | --- | --- | --- | --- | --- | --- | | | | (Unaudited) | | | | | Continuing operations | | | | | | | Net sales | 3 | 2,427,678 | | 1,798,293 | | | Cost of sales | 3 & 4 | (1,766,892 | ) | (1,223,890 | ) | | Gross profit | 3 | 660,786 | | 574,403 | | | Selling, general and administrative expenses | 3 & 5 | (236,955 | ) | (164,548 | ) | | Other operating income, net | 3 | 11,024 | | 5,561 | | | Operating income | 3 | 434,855 | | 415,416 | | | Interest expense | | (45,138 | ) | (16,948 | ) | | Interest income | | 17,474 | | 10,817 | | | Other financial expenses, net | 6 | (55,798 | ) | (76,122 | ) | | Equity in earnings (losses) of associated companies | | 295 | | (1,003 | ) | | Income before income tax expense | | 351,688 | | 332,160 | | | Income tax | | | | | | | Current and deferred income tax expense | | (65,755 | ) | (80,532 | ) | | Reversal of deferred statutory profit sharing | 9 | 96,265 | | - | | | Income from continuing operations | | 382,198 | | 251,628 | | | Discontinued operations | | | | | | | Income from discontinued operations | 12 | 101,369 | | - | | | Net income for the period | | 483,567 | | 251,628 | | | Attributable to: | | | | | | | Equity holders of the Company | | 422,125 | | 222,133 | | | Minority interest | | 61,442 | | 29,495 | | | | | 483,567 | | 251,628 | | | Weighted average number of shares outstanding | | 2,004,743,442 | | 2,004,743,442 | | | Basic and diluted earnings per share for profit attributable to the equity holders of the Company (expressed in USD per share) | | 0.21 | | 0.11 | |

The accompanying notes are an integral part of these consolidated condensed interim financial statements. These consolidated condensed interim financial statements should be read in conjunction with our audited Consolidated Financial Statements and notes for the fiscal year ended December 31, 2007.

-2-

TERNIUM S.A.

Consolidated condensed interim financial statements as of March 31, 2008

and for the three-month periods ended March 31, 2008 and 2007

(All amounts in USD thousands)

CONSOLIDATED CONDENSED BALANCE SHEETS


ASSETS	(Unaudited)
Non-current
assets
Property,
plant and equipment,
net	7	6, 912,982		6,858,779
Intangible
assets, net	8	1,463,768		1,452,230
Investments
in associated companies		44,692		44,042
Other
investments, net		15,304		14,815
Deferred
tax assets		24,072		31,793
Receivables,
net		77,524	8,538,342	217,638	8,619,297
Current
assets
Receivables		561,260		426,038
Derivative
financial instruments		-		577
Inventories,
net		2,128,354		1,913,051
Trade
receivables, net		923,248		847,827
Other
investments		66,144		65,337
Cash
and cash equivalents		996,633	4,675,639	1,126,041	4,378,871
Non-current
assets classified as held for sale			7,123		769,142
			4,682,762		5,148,013
Total
assets			13,221,104		13,767,310
EQUITY
Capital
and reserves attributable to the company’s equity holders			4,902,663		4,452,680
Minority
interest			1,978,317		1,914,210
Total
equity			6,880,980		6,366,890
LIABILITIES
Non-current
liabilities
Provisions		59,559		57,345
Deferred
income tax		1,157,862		1,337,039
Non
current tax liabilities		1,461		-
Other
liabilities		364,467		336,500
Trade
payables		6,554		6,690
Borrowings		2,631,752	4,221,655	3,677,497	5,415,071
Current
liabilities
Current
tax liabilities		280,376		184,766
Other
liabilities		179,689		182,239
Trade
payables		1,085,089		983,884
Derivative
financial instruments		29,464		13,293
Borrowings		543,851	2,118,469	407,404	1,771,586
Liabilities
directly associated with non-current assets classified as held for
sale			-		213,763
			2,118,469		1,985,349
Total
liabilities			6,340,124		7,400,420
Total
equity and liabilities			13,221,104		13,767,310

Contingencies, commitments and restrictions to the distribution of profits are disclosed in Note 11.

-3-

TERNIUM S.A.

Consolidated condensed interim financial statements as of March 31, 2008

and for the three-month periods ended March 31, 2008 and 2007

(All amounts in USD thousands)

CONSOLIDATED CONDENSED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

| Capital stock (2) | Initial public offering expenses | | Revaluation and other reserves | Capital stock issue discount (3) | | Currency translation adjustment | | Retained earnings | Total | | Minority interest | | Total Equity | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | Balance at January 1, 2008 | 2,004,744 | (23,295 | ) | 1,946,962 | (2,324,866 | ) | (110,739 | ) | 2,959,874 | 4,452,680 | | 1,914,210 | | 6,366,890 | | | Currency translation adjustment | | | | | | | 27,858 | | | 27,858 | | 2,665 | | 30,523 | | | Net income for the period | | | | | | | | | 422,125 | 422,125 | | 61,442 | | 483,567 | | | Total recognized income for the period | 2,004,744 | (23,295 | ) | 1,946,962 | (2,324,866 | ) | (82,881 | ) | 3,381,999 | 4,902,663 | | 1,978,317 | | 6,880,980 | | | Balance at March 31, 2008 | 2,004,744 | (23,295 | ) | 1,946,962 | (2,324,866 | ) | (82,881 | ) | 3,381,999 | 4,902,663 | | 1,978,317 | | 6,880,980 | | | Balance at January 1, 2007 | 2,004,744 | (23,295 | ) | 2,047,199 | (2,324,866 | ) | (121,608 | ) | 2,175,384 | 3,757,558 | | 1,729,583 | | 5,487,141 | | | Currency translation adjustment | | | | | | | (40,952 | ) | | (40,952 | ) | (11,283 | ) | (52,235 | ) | | Net income for the period | | | | | | | | | 222,133 | 222,133 | | 29,495 | | 251,628 | | | Total recognized income for the period | 2,004,744 | (23,295 | ) | 2,047,199 | (2,324,866 | ) | (162,560 | ) | 2,397,517 | 3,938,739 | | 1,747,795 | | 5,686,534 | | | Dividends paid in cash and other distributions by subsidiary companies | | | | | | | | | | - | | (154 | ) | (154 | ) | | Balance at March 31, 2007 | 2,004,744 | (23,295 | ) | 2,047,199 | (2,324,866 | ) | (162,560 | ) | 2,397,517 | 3,938,739 | | 1,747,641 | | 5,686,380 | |

(1) Shareholders’ equity determined in accordance with accounting principles generally accepted in Luxembourg is disclosed in Note 11 (ii).

(2) At March 31, 2008, the Capital Stock adds up to 2,004,743,442 shares at a nominal value of USD 1 each.

(3) Represents the difference between book value of non-monetary contributions received from shareholders under Luxembourg GAAP and IFRS.

Dividends may be paid by Ternium to the extent distributable retained earnings calculated in accordance with Luxembourg law and regulations exist. Therefore, retained earnings included in these consolidated condensed interim financial statements may not be wholly distributable. See Note 11 (ii).

-4-

TERNIUM S.A.

Consolidated condensed interim financial statements as of March 31, 2008

and for the three-month periods ended March 31, 2008 and 2007

(All amounts in USD thousands)

CONSOLIDATED CONDENSED INTERIM CASH FLOW STATEMENTS

	Notes
	2008		2007
	(Unaudited)
Cash
flows from operating activities
Net
income for the period		483,567		251,628
Adjustments
for:
Depreciation
and amortization	7
& 8	157,682		115,259
Income
tax accruals less payments		(108,019	)	57,976
Equity
in (earnings) losses of associated companies		(295	)	1,003
Interest
accruals less payments		(87,575	)	(4,735	)
Changes
in provisions		5,444		(3,316	)
Changes
in working capital		(227,515	)	110,349
Discontinued
operations	12	(101,369	)	-
Others		(1,830	)	2,129
Net
cash provided by operating activities		120,090		530,293
Cash
flows from investing activities
Capital
expenditures	7
& 8	(156,644	)	(102,385	)
Proceeds
form the sale of property, plant and equipment		855		5,174
Increase
in other investments		(807	)	-
Discontinued
operations	12	722,523		-
Net
cash provided by (used in) investing activities		565,927		(97,211	)
Cash
flows from financing activities
Proceeds
from borrowings		104,984		120,141
Repayments
of borrowings		(921,379	)	(212,527	)
Net
cash used in financing activities		(816,395	)	(92,386	)
(Decrease)/Increase
in cash and cash equivalents		(130,378	)	340,696
Movement
in cash and cash equivalents
At
January 1, (1)		1,126,041		633,002
Effect
of exchange rate changes		970		(380	)
(Decrease)/Increase
in cash and cash equivalents		(130,378	)	340,696
Cash
and cash equivalents at March 31, (1)		996,633		973,318

(1) In addition, the Company had restricted cash for USD 10,372 at March 31, 2007.

-5-

TERNIUM S.A.

Consolidated condensed interim financial statements as of March 31, 2008

and for the three-month periods ended March 31, 2008 and 2007

(All amounts in USD thousands)

INDEX TO THE NOTES TO THE CONSOLIDATED CONDENSED INTERIM FINANCIAL STATEMENTS

| 1 | General information and basis of presentation | | --- | --- | | 2 | Accounting policies | | 3 | Segment information | | 4 | Cost of sales | | 5 | Selling, general and administrative expenses | | 6 | Other financial expenses, net | | 7 | Property, plant and equipment, net | | 8 | Intangible assets, net | | 9 | Deferred Statutory Profit Sharing | | 10 | Distribution of dividends | | 11 | Contingencies, commitments and restrictions on the distribution of profits | | 12 | Discontinued operations | | 13 | Related party transactions | | 14 | Subsequent event: Sidor nationalization process | | 15 | Recently issued accounting pronouncements |

-6-

TERNIUM S.A.

Notes to the Consolidated Condensed Interim Financial Statements

1 General information and basis of presentation

Ternium S.A. (the “Company” or “Ternium”), a Luxembourg Corporation (Societé Anonyme), was incorporated on December 22, 2003 under the name of Zoompart Holding S.A. to hold investments in flat and long steel manufacturing and distributing companies. The extraordinary shareholders’ meeting held on August 18, 2005, changed the corporate name to Ternium S.A.

Following a corporate reorganization carried out during fiscal year 2005, in January 2006 the Company successfully completed its registration process with the United States Securities and Exchange Commission (“SEC”). As from February 1, 2006, the Company’s shares are listed in the New York Stock Exchange.

The name and percentage of ownership of subsidiaries that have been included in consolidation in these Consolidated Condensed Interim Financial Statement is disclosed in Note 2 to the audited Consolidated Financial Statements for the year ended December 31, 2007.

These Consolidated Condensed Interim Financial Statements have been prepared in accordance with IAS 34, “Interim Financial Reporting”. These Consolidated Condensed Interim Financial Statements should be read in conjunction with the audited Consolidated Financial Statements for the year ended December 31, 2007, which have been prepared in accordance with International Financial Reporting Standards (“IFRS”).

Certain comparative amounts have been reclassified to conform to changes in presentation in the current period.

The preparation of consolidated condensed interim financial statements requires management to make estimates and assumptions that might affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the balance sheet dates, and also the reported amounts of revenues and expenses for the reported periods. Actual results may differ from these estimates.

Material intercompany transactions and balances have been eliminated in consolidation. However, the fact that the functional currency of the Company’s subsidiaries differ, results in the generation of foreign exchange gains (losses) that are included in the consolidated condensed interim income statement under “Other financial expenses, net”.

These Consolidated Condensed Interim Financial Statements were approved by the Board of Directors of Ternium on May 5, 2008.

2 Accounting policies

The accounting policies used in the preparation of these Consolidated Condensed Interim Financial Statements are consistent with those used in the audited Consolidated Financial Statements for the year ended December 31, 2007.

Recently issued accounting pronouncements were applied by the Company as from their respective dates.

-7-

TERNIUM S.A.

Notes to the Consolidated Condensed Interim Financial Statements (Contd.)

3 Segment information

Primary reporting format – business segments

Business segments: for management purposes, the Company is organized on a worldwide basis into the following segments: flat steel products, long steel products and others.

The flat steel products segment comprises the manufacturing and marketing of hot rolled coils and sheets, cold rolled coils and sheets, tin plate, welded pipes, hot dipped galvanized and electrogalvanized sheets, pre-painted sheets and other tailor-made products to serve its customers’ requirements.

The long steel products segment comprises the manufacturing and marketing of billets (steel in its basic, semifinished state), wire rod and bars.

The other products segment includes products other than flat and long steel, mainly pig iron and pellets.


(Unaudited)
Three-month
period ended March 31, 2008
Net
sales	1,990,554		371,057		66,067		2,427,678
Cost
of sales	(1,457,770	)	(267,640	)	(41,482	)	(1,766,892	)
Gross
profit	532,784		103,417		24,585		660,786
Selling,
general and administrative expenses	(190,072	)	(40,902	)	(5,981	)	(236,955	)
Other
operating income, net	7,362		3,147		515		11,024
Operating
income	350,074		65,662		19,119		434,855
Depreciation

PP&E | 115,170 | | 18,812 | | 2,403 | | 136,385 | | | Flat steel products | | Long steel products | | Other | | Total | | | | (Unaudited) | | | | | | | | | | Three-month period ended March 31, 2007 | | | | | | | | | | Net sales | 1,392,938 | | 357,737 | | 47,618 | | 1,798,293 | | | Cost of sales | (941,703 | ) | (249,290 | ) | (32,897 | ) | (1,223,890 | ) | | Gross profit | 451,235 | | 108,447 | | 14,721 | | 574,403 | | | Selling, general and administrative expenses | (129,361 | ) | (30,526 | ) | (4,661 | ) | (164,548 | ) | | Other operating income, net | 3,826 | | 903 | | 832 | | 5,561 | | | Operating income | 325,700 | | 78,824 | | 10,892 | | 415,416 | | | Depreciation
PP&E | 90,990 | | 15,644 | | 3,318 | | 109,952 | |

-8-

TERNIUM S.A.

Notes to the Consolidated Condensed Interim Financial Statements (Contd.)

3 Segment information (continued)

Secondary reporting format - geographical segments

The secondary reporting format is based on a geographical location. Ternium sells its products to three main geographical areas: South and Central America, North America, and Europe and others. The North American segment comprises principally United States, Canada and Mexico. The South and Central American segment comprises principally Argentina, Brazil, Colombia, Venezuela and Ecuador.


(Unaudited)
Three-month
period ended March 31, 2008
Net
sales	1,144,634	1,244,093	38,951	2,427,678
Depreciation
– PP&E	81,915	54,461	9	136,385
Three-month
period ended March 31, 2007
Net
sales	1,011,159	733,236	53,898	1,798,293
Depreciation
– PP&E	75,445	34,480	27	109,952

4 Cost of sales

2008		2007
(Unaudited)
Inventories
at the beginning of the year	1,913,051		1,241,325
Plus:
Charges for the period
Raw
materials and consumables used and other movements	1,498,713		772,759
Services
and fees	54,863		43,195
Labor
cost	167,253		131,678
Depreciation
of property, plant and equipment	133,444		106,701
Amortization
of intangible assets	5,625		3,687
Maintenance
expenses	100,538		95,987
Office
expenses	2,288		1,719
Freight
and transportation	11,192		6,451
Insurance	4,052		2,462
Allowance
(Recovery) for obsolescence	3,276		(4,424	)
Recovery
from sales of scrap and by-products	(23,139	)	(20,498	)
Others	24,090		24,247
Less:
Inventories at the end of the period	(2,128,354	)	(1,181,399	)
Cost
of sales	1,766,892		1,223,890

-9-

TERNIUM S.A.

Notes to the Consolidated Condensed Interim Financial Statements (Contd.)

5 Selling, general and administrative expenses

2008		2007
(Unaudited)
Services
and fees	19,900		11,237
Labor
cost	60,179		39,713
Depreciation
of property plant and equipment	2,941		3,251
Amortization
of intangible assets	15,672		1,620
Maintenance
expenses	4,355		3,584
Taxes	25,087		15,547
Office
expenses	8,287		5,975
Freight
and transportation	93,280		80,104
Insurance	319		268
Recovery
for doubtful accounts	(569	)	(2,155	)
Others	7,504		5,404
Selling,
general and administrative expenses	236,955		164,548

6 Other financial expenses, net

2008		2007
(Unaudited)
Net
foreign exchange transaction gains and change in fair value of derivative
instruments	16,722		18,904
Debt
issue costs	(7,189	)	(1,063	)
Loss
from Participation Account	(38,871	)	(90,701	)
Others	(26,460	)	(3,262	)
Other
financial expenses, net	(55,798	)	(76,122	)

7 Property, plant and equipment, net

2008		2007
(Unaudited)
At
the beginning of the year	6,858,779		5,420,683
Currency
translation differences	46,366		(47,820	)
Transfers	(3,174	)	-
Additions	147,962		92,403
Disposals	(566	)	(3,916	)
Depreciation
charge	(136,385	)	(109,952	)
At
the end of the period	6,912,982		5,351,398

-10-

TERNIUM S.A.

Notes to the Consolidated Condensed Interim Financial Statements (Contd.)

8 Intangible assets, net

2008		2007
(Unaudited)
At
the beginning of the year	1,452,230		551,587
Currency
translation differences	21,292		(8,448	)
Transfers	3,174		-
Additions	8,682		9,982
Disposals	(313	)	-
Amortization
charge	(21,297	)	(5,307	)
At
the end of the period	1,463,768		547,814

9 Deferred Statutory Profit Sharing

As mentioned in Note 4 (m) to the audited consolidated financial statements at December 31, 2007, Mexican laws require local companies to pay its employees a profit sharing bonus calculated on a basis similar to that used for local income tax purposes. The Company accounts for temporary differences arising between the statutory calculation and the reported expense determined under IFRS in a manner similar to calculation of deferred income tax.

In 2008, one of Ternium’s Mexican subsidiaries (Hylsa S.A. de C.V., “Hylsa”) entered into a spin off that became effective on March 31, 2008. After this corporate reorganization, all of Hylsa’s employees are included in the payroll of a company that is expected to generate non-significant taxable income and non-significant temporary differences. The Company agreed to pay its employees a bonus salary that will be calculated on a basis similar to that used for income tax purposes. Accordingly, during the three-month period ended March 31, 2008, the Company reversed the outstanding balance of the liability as of December 31, 2007 (amounting to USD 96 million) within Income tax benefit (expense) line item in the Consolidated Condensed Interim Income Statement.

10 Distribution of dividends

On February 26, 2008, the Board of Directors proposed a dividend distribution of USD 0.05 per share (USD 0.50 per ADS), or approximately USD 100.2 million in the aggregate, which is subject to shareholder approval at the Company’s annual general shareholders’ meeting to be held on June 4, 2008. If the annual dividend is approved at the annual general shareholders’ meeting, the payment date is expected to be on June 12, 2008.

11 Contingencies, commitments and restrictions on the distribution of profits

This note should be read in conjunction with Note 27 to the Company’s audited Consolidated Financial Statements for the year ended December 31, 2007. Significant changes or events since the date of the annual report are as follows:

(i) Siderar investment plan

Within the investment plan to increase its production capacity to 4 million tons per year, Siderar has entered into several commitments to acquire a new continuous casting machine for a total consideration of USD 70.6 million.

-11-

TERNIUM S.A.

Notes to the Consolidated Condensed Interim Financial Statements (Contd.)

11 Contingencies, commitments and restrictions on the distribution of profits (continued)

(ii) Restrictions on the distribution of profits

Under Luxembourg law, at least 5% of net income per year calculated in accordance with Luxembourg law and regulations must be allocated to a reserve until such reserve equals 10% of the share capital. At March 31, 2008, this reserve reached the above-mentioned threshold.

Ternium may pay dividends to the extent that it has distributable retained earnings and distributable reserves calculated in accordance with Luxembourg law and regulations. Therefore, retained earnings included in these consolidated condensed interim financial statements may not be wholly distributable.

Shareholders' equity under Luxembourg law and regulations comprises the following captions:


(Unaudited)
Share
capital	2,004,744
Legal
reserve	200,474
Distributable
reserves	301,912
Non
distributable reserves	1,414,122
Accumulated
profit at January 1, 2008	1,231,825
Profit
for the period	166,957
Total
shareholders’ equity under Luxembourg GAAP	5,320,034

12 Discontinued operations

On February 1, 2008, Ternium, through its subsidiary Imsa Acero S.A. de C.V., completed the sale of its interests in Steelscape Inc., ASC Profiles Inc., Varco Pruden Buildings Inc. and Metl-Span LLC to BlueScope Steel North America Corporation, a subsidiary of BlueScope Steel Limited, for a total consideration of USD 726.6 million on a cash-free and debt-free basis, subject to working capital and other adjustments. Direct transaction costs paid by the Company in connection with this sale totaled USD 4.1 million. The Company continues to own Steelscape’s Shreveport, LA plant. Ternium has also retained its pre-engineered metal buildings and insulated steel panels businesses in Mexico. The result of this transaction was a gain of USD 101.4 million, calculated as the net proceeds of the sale less the book value of discontinued net assets and the corresponding tax effect.

13 Related party transactions

The Company is controlled by San Faustín, which at March 31, 2008 indirectly owned 70.52% of Ternium’s shares and voting rights. Rocca & Partners S.A. controls a significant portion of the voting power of San Faustin N.V. and has the ability to influence matters affecting, or submitted to a vote of the shareholders of San Faustin N.V., such as the election of directors, the approval of certain corporate transactions and other matters concerning the Company’s policies. There are no controlling shareholders for Rocca & Partners S.A.

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TERNIUM S.A.

Notes to the Consolidated Condensed Interim Financial Statements (Contd.)

13 Related party transactions (continued)

The following transactions were carried out with related parties:

2008	2007
(Unaudited)
(i) Transactions
(a)
Sales of goods and services
Sales
of goods to associated parties	-	27
Sales
of goods to other related parties	22,845	24,677
Sales
of services and others to associated parties	85	829
Sales
of services and others to other related parties	107	2,854
	23,037	28,387
(b)
Purchases of goods and services
Purchases
of goods from associated parties	12,413	20,101
Purchases
of goods from other related parties	10,055	11,373
Purchases
of services and others from associated parties	7,062	5,688
Purchases
of services and others from other related
parties	47,050	57,843
	76,580	95,005

2008	2007
(Unaudited)
(i) Transactions
(c)
Financial results
Income
with associated parties	644	1,161
Income
with other related parties	35	-
Expenses
with other related parties	-	(12	)
	679	1,149


(Unaudited)
(ii)
Period-end balances
(a)
Arising from sales/purchases of goods/services
Receivables
from associated parties	36,830		40,980
Receivables
from other related parties	32,949		53,004
Payables
to associated parties	(12,128	)	(7,681	)
Payables
to other related parties	(40,883	)	(29,749	)
	16,768		56,554
b)
Other investments
Time
deposits	12,781		12,673

-13-

TERNIUM S.A.

Notes to the Consolidated Condensed Interim Financial Statements (Contd.)

14 Subsequent event: Sidor Nationalization Process

On March 31, 2008, the Company controlled approximately 59.7% of Sidor, while CVG Corporación Venezolana de Guayana (a company owned by the Venezuelan government) held approximately 20.4% of Sidor and certain Sidor employees and former employees held the remaining 19.9% interest.

On April 8, 2008, the Venezuelan government announced its intention to take control over Sidor. Following the confirmation of the Venezuelan government’s decision to nationalize Sidor, on April 16, 2008, Ternium, Sidor and the Venezuelan government entered into an agreement providing for the creation of a transition committee, composed of representatives of the government, the union and class B employee shareholders. This committee is charged with overseeing Sidor’s operations during the transition period until the nationalization is completed, acting in coordination with Sidor’s board of directors.

On April 29, 2008, the National Assembly of the Republic of Venezuela passed a resolution declaring that the shares of Sidor, together with all of its assets, are of public and social interest. This resolution authorizes the Venezuelan government to take any action it may deem appropriate in connection with any such assets, which may include expropriation.

The discussions among representatives of Ternium and the Venezuelan government regarding adequate and fair terms and conditions upon which all or a significant part of Ternium’s interest in Sidor would be transferred to the government, which began with the formation of a negotiating committee, are presently under way. The date on which control over Sidor would be transferred to the government is uncertain at this time.

The impact of the potential government actions with respect to Sidor on Ternium’s financial position is not determinable at this time.

Ternium continues to preserve all of its rights under contracts, investment treaties and Venezuelan and international law and will continue to evaluate its options in realizing the fair value of its interest in Sidor.

From an accounting perspective (book value), total assets and total liabilities of Sidor were USD 3,121.4 million and USD 855.5 million, respectively, at March 31, 2008, while the book value of Ternium´s interest in Sidor was USD 1,299.2 million at March 31, 2008. None of such book values represents the fair market value of Sidor as a going concern. Revenue, operating income and equity holders’ net income of Sidor for the first quarter of 2008 were USD 513.9 million, USD 63.4 million and USD 50.3 million, respectively

15 Recently issued accounting pronouncements

(i) International Accounting Standard 27 (amended 2008), “Consolidated and separate financial statements”

In January 2008, the International Accounting Standards Board (“IASB”) issued International Accounting Standard 27 (amended 2008), “Consolidated and separate financial statements” (“IAS 27 - amended”). IAS 27 - amended includes modifications to International Accounting Standard 27 that are related, primarily, to accounting for non-controlling interests and the loss of control of a subsidiary.

IAS 27 - amended must be applied for annual periods beginning on or after 1 July 2009, although earlier application is permitted. However, an entity must not apply the amendments contained in IAS 27 - amended for annual periods beginning before 1 July 2009 unless it also applies IFRS 3 (as revised in 2008).

The Company's management has not assessed the potential impact that the application of IAS 27 - amended may have on the Company's financial condition or results of operations.

-14-

TERNIUM S.A.

Notes to the Consolidated Condensed Interim Financial Statements (Contd.)

15 Recently issued accounting pronouncements (continued)

(ii) International Financial Reporting Standard 3 (revised January 2008), “Business combinations”

In January 2008, the IASB issued International Financial Reporting Standard 3 (revised January 2008), “Business combinations” (“IFRS 3 revised”). IFRS 3 revised includes amendments that are meant to provide guidance for applying the acquisition method.

IFRS 3 revised replaces IFRS 3 (as issued in 2004) and comes into effect for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after 1 July 2009. Earlier application is permitted, provided that IAS 27 – amended is applied at the same time.

The Company's management estimates that the application of IFRS 3 revised will not have a material effect on the Company's financial condition or results of operations.

(iii) International Financial Reporting Standard 2 (amended January 2008), “Share-based payment”

In January 2008, the IASB issued International Financial Reporting Standard 2 (amended January 2008), “Share-based payment” (“IFRS 2 revised”). IFRS 2 revised establishes that for equity-settled share-based payment transactions, an entity shall measure the goods or services received, and the corresponding increase in equity, directly, at the fair value of the goods or services received, unless that fair value cannot be estimated reliably. If the entity cannot estimate reliably the fair value of the goods or services received, the entity is required to measure their value, and the corresponding increase in equity, indirectly, by reference to the fair value of the equity instruments granted. For goods or services measured by reference to the fair value of the equity instruments granted, IFRS 2 revised specifies that all non-vesting conditions are taken into account in the estimate of the fair value of the equity instruments.

Entities shall apply these amendments to all share-based payments within the scope of IFRS 2 for annual periods beginning on or after 1 January 2009. Earlier application is permitted.

The Company's management estimates that the application of IFRS 2 revised will not have a material effect on the Company's financial condition or results of operations.

(iv) Amendments to International Accounting Standard 32 “Financial instruments: presentation” and International Accounting Standard 1 “Presentation of financial statements” (as revised in 2007) - Puttable financial instruments and obligations

In February 2008 the IASB amended International Accounting Standard 32 “Financial instruments: presentation” by requiring some financial instruments that meet the definition of a financial liability to be classified as equity. The amendment addresses the classification of some: (a) puttable financial instruments, and (b) instruments, or components of instruments, that impose on the entity an obligation to deliver to another party a pro rata share of the net assets of the entity only on liquidation.

Entities shall apply these amendments for annual periods beginning on or after 1 January 2009. Earlier application is permitted. If entities apply these amendments for an earlier period, they shall disclose that fact.

The Company's management has not assessed the potential impact that the application of IAS 32 (revised 2008) and IAS 1 (revised 2008) may have on the Company's financial condition or results of operations.

| Roberto

Philipps
Chief
Financial Officer

-15-

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Ternium S.A. Interim / Quarterly Report 2008

30864_ffr_2008-05-06_32e79f55-0c36-4179-be75-f59670880f6c.zip

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Ternium S.A. — Interim / Quarterly Report 2008

30864_ffr_2008-05-06_32e79f55-0c36-4179-be75-f59670880f6c.zip

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