Tecnoglass(US:TGLS)2021-08-06 22:09Financial Data and Key Metrics Changes - Total revenues increased 49% year-over-year to a record $121.7 million, driven by strong U.S. revenue growth of 39% [9][31] - Adjusted EBITDA rose 52.7% to a record $35.6 million, with an adjusted EBITDA margin of 29.3%, marking an 80 basis point improvement [32] - Gross profit increased 52.9% to $48.6 million, achieving a gross margin of 40%, up from 38.8% in the prior year [33] Business Line Data and Key Metrics Changes - Single-family residential revenues surged 159% year-over-year, accounting for 37% of U.S. sales during the quarter [9][21] - Approximately 2/3 of the backlog consists of medium- and high-rise residential projects, with the remaining 1/3 related to various commercial projects [17] - The backlog grew 1.7% year-over-year to a record level of $559 million, representing more than 1.25 times the last 12 months' revenue [17] Market Data and Key Metrics Changes - The U.S. market represented over 90% of the backlog, up from 88% in the prior year quarter, benefiting from an active construction environment [18] - The ABI index increased to 57.1% in June, indicating expansion for the fifth consecutive month [19] Company Strategy and Development Direction - The company plans to invest an additional $10 million to $15 million in capital expenditures to enhance production lines, with a focus on automation [38] - The strategy includes expanding single-family residential and commercial demand in the U.S. while maintaining a growth-oriented capital allocation approach [14][63] - The company aims to leverage its vertically integrated operations to deliver innovative products with superior lead times [26][46] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the business and the positive momentum moving into the second half of the year [13][14] - The outlook for full-year 2021 revenue is raised to $450 million to $465 million, representing a growth of 22% at the midpoint [40] - The company anticipates a higher mix of product versus installation revenue for the full year, driven by strong single-family residential sales [42] Other Important Information - The company achieved its lowest leverage ratio since 2015 at 1.1x, reflecting improved financial flexibility [35] - The construction of a new float glass plant in Barranquilla is on track to break ground in the first half of 2022 [39] Q&A Session Summary Question: Can you expand on your view of the residential market and revenue potential from homebuilders? - Management indicated that new revenue from homebuilders is minimal as they are just entering that market, but see significant growth potential [50] Question: Can you discuss the commercial side of the business and geographic strengths? - Management noted strong commercial activity across all states they operate in, with expectations for continued growth in 2022 [54] Question: What are your lead times compared to competitors? - Management stated they have shorter lead times, experiencing some delays due to increased orders but have since returned to normal [57] Question: What is the outlook for the commercial business? - Management expects the commercial side to pick up in the second half of the year, with significant growth anticipated in 2022 [68] Question: Can you update on initiatives to expand the residential business outside of Florida? - Management is cautiously expanding into states like Georgia and Texas, learning the market requirements before full-scale operations [71] Question: What is the guidance for Colombia and single-family? - Management expects continued growth in single-family while anticipating flat performance in Colombia and Latin America [73]