Financial performance

In 2016, Grupo Lamosa continued to operate with a solid financial position, attractive margins and favorable cash flow generation and was thus able to implement one of its most aggressive investment plans of the past few years.

$1,637 million pesos were invested during the year, largely from the company’s internal cash flow. The resources were used to satisfy operating needs and expand production capacity at several production centers, as well as to build new plants, including a new porcelain plant in the state of Guanajuato.

One of the great highlights of 2016 was the closing of the acquisition of Cerámica San Lorenzo in South America for a total amount of approximately U.S. $230 million dollars. The transaction was funded with debt under more favorable leverage conditions and with less risk than in the case of past acquisitions. Thus, the company’s net debt to EBITDA ratio at yearend 2016 was 2.8 times.

Financing for the purchase of Cerámica San Lorenzo was obtained from two debt operations with committed credit lines, through which Grupo Lamosa also pushed out the settlement dates and average life of its debt, significantly improving its repayment profile.

In 2016, the company paid its stockholders dividends in cash and shares in accordance with that decreed at the Annual Stockholders’ Assembly.

Grupo Lamosa continued to take part in the Mexican Stock Exchange’s Independent Analyst Program during the year, in order to continue providing the market with objective, periodic analytical reports on its activities, thereby benefitting current and potential investors in Mexico and abroad.

Grupo Lamosa made no transactions with the shares representing its capital stock in 2016.