WALL AND FLOOR TILES

The recovery of the Mexican construction sector, which showed consistent growth throughout 2015, resulted in the tile industry expanding more than over the past few years.

Sales of the Wall and Floor Tiles Business increased 19% year-over-year, driven not only by domestic market growth, but also enhanced export sales, which represented 19% of the segment’s 2015 revenues.

One of the factors boosting the Wall and Floor Tiles Business’s revenues was the growing use of ceramic products in non-traditional applications which would have previously been inconceivable. For example, “ceramic wood” flooring, using ceramic or porcelain tiles with shapes, textures and finishes like natural wood, has become a real and desirable option for consumers because of its simple maintenance and superior durability.

2015 was characterized by a number of market trends, including the migration of consumer preferences to larger, more expensive tiles. The business capitalized on this tendency because of an ongoing strategy that anticipates consumer needs, providing them with a forward-looking portfolio of innovative products manufactured with state-of-the-art technology.

The Wall and Floor Tiles Business was able to effectively adapt its production capacity to the new product mix, a significant achievement of the year that demonstrates that Grupo Lamosa has the operating flexibility to satisfy changing market demands.

The premium “Firenze” line performed particularly well in 2015, consolidating its position as an attractive, differentiated option in a range of innovative designs with outstanding quality, price and service characteristics. One of the exclusive “Firenze” product launches in the Great Mexican Collections line was a series of products inspired by the geography, environment and culture of the state of Nuevo León (Grupo Lamosa’s home location). This range was very well received both in Mexico and abroad.

The segment’s focus on new technologies in order to offer the latest fashions and designs has benefitted consumers with the development and rollout of new tile lines with increasingly shorter lifespans and a continuous renovation of the product portfolio.

Some of the significant innovations launched in 2015 were: “Biology,” a 20cm X 120cm porcelain tile that looks like wood; and “Park,” a ceramic tile that looks like granite in a range of sizes and finishes. Such offerings satisfy different usage requirements in residential and commercial projects.

The Wall and Floor Tiles Business took part in a number of fairs and exhibitions during the year, rolling out new products there. These included: “Coverings 2015” in Orlando, Florida, and “ExpoCIHAC” in Mexico City.

During the year, the segment invested in its different production centers, in order to continue incorporating new technologies and expanding its production capacity, thereby positioning it to continue serving its markets in a timely manner and grow as planned.

Over the past two years, Grupo Lamosa has authorized capital expenditures of $2,400 million pesos to optimize capacity and increase it by more than 15%. The investment will be particularly focused on enhancing large-tile production capacity and the construction of a new porcelain-tile plant to better serve market needs both in Mexico and abroad. The new plant is expected to come on line during the second half of 2016.

The segment has worked over the past few years to continue developing operations both in Mexico and abroad. New technologies are creating new possibilities for ceramic products which, combined with the company’s innovation strategy, will open up new avenues for growth going forward.