Wall and floor tiles
In 2016, the Wall and Floor Tiles Business capitalized on the increase in demand for its products and the growth that had been observed in the industry since the end of 2014.
(millions of pesos)
2016 sales for the segment were 34% above those of 2015, driven by its proactive perception of the market recovery and consequent decision to invest in capacity expansion to satisfy the needs of an increasingly demanding and informed customer base.
Another aspect that contributed to the business’s performance was the determination of the Mexican national trade authorities to remedy the disloyal competition resulting from the dumping of imported ceramic products in Mexico. Its resolutions, involving the imposing of compensatory duties, contributed to the promotion of healthy competition in the market and assured fair, clear conditions with regard to product quality, technical characteristics and prices, all of this for the benefit of the consumer.
One of the highlights of 2016 was the start up of a new plant in Guanajuato during the second half of the year. This facility boasts leading-edge technology, was specially designed for manufacturing porcelain products and underscores the company’s focus on offering high value added products for the medium and high-end market segments.
During the year, the Wall and Floor Tiles Business continued its initiatives to reposition its brands according to specific target markets. In the particular case of the luxury Firenze brand, the business launched new products with qualities and designs on a level with any high-end European equivalent, but with the advantages implicit in locally manufactured products, such as greater availability, reduced lead times and lower prices.
In 2016, the business took part in trade fairs and exhibitions both in Mexico and abroad, such as Coverings during the second quarter of the year. This fair, held in the United States, is the largest global tile event in North America.
It also took part in Expo CIHAC in Mexico City at the end of the year, capitalizing on the opportunity to present the new 2017 collections, where natural stone and wood designs were particularly well received. The product lines launched included the new Royal Wood tile in a 20 x 120 cm format, and the Capetown series of large rustic tiles for covering building facades.
Without doubt, the highlight of the year was the acquisition of Cerámica San Lorenzo, a company with a market presence in Argentina, Chile, Colombia and Peru, and its two main brands: San Lorenzo and Cordillera. The transaction was the successful culmination of a prolonged process, through which this business sought options to diversify and geographically expand its production activities in the Americas.
The incorporation of the operations of Cerámica San Lorenzo as of the fourth quarter of the year represents a significant challenge for a near future characterized by an environment of great uncertainty. The business will begin a period of integrating the different cultures, business practices and production processes, and will identify and capitalize on the resulting synergies in the short and medium term.