Glaston Corp.’s Orders See Slight Growth in the Third Quarter

In the third quarter of 2019, Glaston’s orders received totaled $50.6 million*, up slightly from $49.8 million last quarter. The company’s net sales totaled $60.4 million in the third quarter compared to $65.4 million last quarter. Recent acquisition Bystronic glass had a number of orders at the end of 2018 that were recognized as revenue in the second and third quarters of 2019, improving actual net sales and profitability.

“Despite weak development of the heat treatment machines market, the quarter was satisfactory,” says president and CEO Arto Metsänen. “Our third-quarter net sales grew by 15% (pro forma) and the comparable EBITA margin was 5.7% of net sales. Total orders received also grew slightly. The slowdown in the heat treatment machines market has continued in 2019 and this was already the second quarter of a difficult market. Third-quarter orders received in the heat treatment technologies product area decreased by nearly 30% from the corresponding period of the previous year. This was clearly below our expectations and that’s why we reacted to the situation rapidly. In early October, we initiated measures adjusting the Glaston segment’s operations to this lower-than-expected demand.

“… demand for insulating glass machines continued to be strong and the number of orders increased. The benefits of insulating glass … are increasing demand for insulating glass machines. Demand for insulating glass and heat treatment machine services was good in the third quarter.

“The integration of Bystronic glass with Glaston has continued well and we have succeeded in combining our operations faster than expected. During the fall, we have, among other things, merged our sales offices in Singapore and China, eliminated overlapping functions, started integrating various IT and CRM systems, and enabled the development of a common digital product platform. Thanks to the measures taken, we have already achieved annual cost savings of $2.6 million. This is more than half of those annual cost synergies of around $4.4 million that we expect to achieve by 2021.”

*Editor’s Note: This quarter’s financial results were converted from Euros to U.S. dollars on October 28, 2019. Results from the second quarter were converted on August 8, 2019.

Tecnoglass’ Total Revenue Improves in the third Quarter of 2019

Tecnoglass Inc.’s total revenue for the third quarter of 2019 improved 11.8% to $108.5 million compared to $97 million in the prior year quarter. The Colombian architectural glass, windows and associated aluminum products manufacturer released its third quarter financial results for the period ending on September 30, 2019.

Excluding the impact of unfavorable foreign currency, total revenues increased 13.6% compared to the prior year quarter. U.S. revenues increased 12.9% to $92.8 million compared to $82.2 million in the prior year quarter.

Gross profit increased 3% to $35.7 million, representing a 33% gross margin compared to gross profit of $34.7 million, representing a 35.8% gross margin in the prior year quarter.

Operating expenses were $20.2 million compared to $19.4 million in the prior year quarter. As a percent of total revenues, operating expenses were 18.6% compared to 20% in the prior year quarter. Operating income increased to $15.6 million compared to $15.3 million in the prior year quarter.

Adjusted earnings before interest, tax, depreciation and amortization (EBITDA) increased 5% to $24 million, or 22.1% of sales compared to $22.8 million, or 23.5% of sales, in the prior year quarter. Adjusted EBITDA in the third quarter 2019 included $1.2 million in contribution from the company’s joint venture with Saint-Gobain.

“We delivered another quarter of record revenues and further cemented our position as a U.S. focused growth company, representing 86% of our business. We achieved our 20th straight quarter of double-digit growth in the U.S., including residential sales up nearly 60% year-over-year,” says Tecnoglass CEO José Manuel Daes. “… With our record
backlog, we are better positioned than ever to continue driving meaningful share gains, particularly in the U.S. We look forward to delivering another full year of double-digit growth in revenue and adjusted EBITDA. Beyond 2019, our strong line up of projects paired with our highly efficient, low-cost operations gives u s confidence  in our ability to generate attractive returns for shareholders for years to come.”

For the full year 2019, the company has increased its outlook for revenues to grow to a range of $430 to $440 million, based on its first nine-month performance , a favorable growth environment in its construction end markets and additional anticipated market share gains in the U.S. Tecnoglass has also raised its adjusted EBITDA outlook to a range of $93 million to $97 million, representing growth of 17.6% at the midpoint year-over-year, driven by higher revenues.

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