In 2014, Grupo Lamosa posted growth in operating results and exceeded the performance of the industry in general, despite a continued sluggishness in the construction and building segments and the environment of low economic growth that has prevailed in Mexico over the past two years.
Because of the reduced market activity and a significant increase in the cost of a number of inputs, such as energy, during the year, the company kept a strict control of its costs and expenses. As a result, profitability levels were maintained in the complex environment of uncertainty and little growth.
Grupo Lamosa implemented major initiatives in 2014, largely focused on identifying and understanding the customer better, protecting and maintaining financial viability, and assuring the company’s future growth. Capital expenditures were made to update the technology of the company’s production centers and introduce information technology.
During the year, the company worked closely with the market in order to anticipate consumers’ needs and expectations, developing and launching high-value, market-leading ceramic products with innovative characteristics that would have been unimaginable only a short time ago and leveraging the qualities and possibilities for use of today’s ceramic.
During the third quarter of the year, Grupo Lamosa refinanced its debt, achieving more favorable credit conditions with a reduced financing cost and a repayment profile better suited to the company’s expansion plans.
In order to strengthen the company’s business processes by integrating them into a robust platform of information technology in preparation for the company’s future growth, in 2014 the SAP System was successfully implemented without affecting the operations of the different business units.
At the end of 2014, Grupo Lamosa announced the signing of an agreement with the Colombian company Corona to spin off its Sanitaryware Business. This strategic transaction, still subject to the approval of the Federal Economic Competition Commission (COFECE), will position Grupo Lamosa to focus on its core tile and adhesives businesses, in order to continue consolidating its presence and leadership in Mexico and other regions of the world.
In accordance with applicable international financial reporting standards and taking into consideration the aforementioned agreement, consolidated sales for the year totaled $8,971 million pesos, an increase of 4% compared to 2013. The company’s operating income and EBITDA totaled $1,566 and $2,011 million pesos respectively, growing 11% year-over-year.
Today, Grupo Lamosa has a more robust financial position. Going forward, the company will concentrate on its core businesses and leverage its new state-of-the-art technology and innovative, market-leading designs to capitalize on the positive environment and growth cycle that is beginning to be perceived in the Mexican construction industry. The size and positioning of its businesses will also be important for significant growth in markets such as the United States and South America.
Grupo Lamosa is grateful once more for the trust of its stockholders, the support of its creditors, suppliers, distributors, customers and friends, and the commitment of its people to achieve the objectives that have been set. On behalf of the Board of Directors, I would like to thank you all.
