Tecnoglass, Inc. (NYSE: TGLS) reported first-quarter 2026 revenue of $249.0 million USD, a 12.0% year-over-year increase and a first-quarter record for the Barranquilla, Colombia-based window and architectural glass manufacturer. Despite the top-line growth, net income fell to $31.9 million USD, or $0.71 per diluted share, from $42.2 million USD, or $0.90 per diluted share, in the same period of 2025, as elevated US aluminum costs linked to import tariffs, mandatory minimum wage increases in Colombia, and a strengthening Colombian peso combined to compress gross margins by 540 basis points to 38.5%.

Multi-family and commercial revenues rose 20.4% year-over-year, driven by continued activity across key markets including geographies beyond Florida, which has historically dominated the company’s US revenue mix. Single-family residential revenues were relatively flat on a year-over-year basis, with management attributing the result to the timing of order conversion into revenue rather than underlying demand, noting that order growth in the segment remained positive into April 2026. On a geographic basis, the US accounted for $237.1 million USD, or approximately 95% of total revenues, up 11.6%. Colombia generated $7.5 million USD, up 17.2%, and other international markets contributed $4.4 million USD, up 27.3%.

Gross profit declined to $95.8 million USD from $97.5 million USD in Q1 2025 despite the higher revenue base. The company cited an unfavorable revenue mix driven by a greater proportion of installation-related revenue, higher raw material costs — with US aluminum tariffs representing an incremental headwind of approximately $6.4 million USD in the quarter — higher salary expenses resulting from annual minimum wage adjustments in Colombia, and the effect of a stronger Colombian peso on costs incurred locally. Pricing actions and operating leverage on higher volume partly offset these pressures.

“We see a clear path to fully offsetting the impact of tariffs in 2027, when full-year pricing across both businesses and incremental automation savings are expected to be realized.” — Santiago Giraldo, Chief Financial Officer, Tecnoglass

Selling, general, and administrative expenses rose to $50.9 million USD, or 20.4% of revenues, from $42.5 million USD, or 19.1%, in Q1 2025. The increase reflected higher personnel costs from annual salary adjustments, peso appreciation, and higher transportation and commission costs tied to revenue growth. The period also included a one-time charge of $2.9 million USD related to Colombia’s *impuesto al patrimonio*, a government-imposed wealth tax levied on large corporations to fund measures addressing recent climate-related events in the country.

Adjusted EBITDA — which excludes non-cash foreign exchange gains and losses, the bad-debt provision, non-recurring charges, and equity-method adjustments related to the company’s joint venture in Vidrio Andino with Saint-Gobain (EPA: SGO) — came in at $61.5 million USD, or 24.7% of total revenues, compared to $70.2 million USD, or 31.6%, in Q1 2025. Adjusted net income was $34.6 million USD, or $0.78 per diluted share, versus $43.1 million USD, or $0.92, in the prior-year quarter.

Cash provided by operating activities was $6.7 million USD, a significant decline from $46.9 million USD in Q1 2025, driven in part by a deliberate build-up of US-sourced aluminum inventories — up $34.3 million USD in the quarter — as part of the company’s tariff mitigation strategy. Capital expenditures of $17.3 million USD reflected scheduled payments tied to previously announced capacity and automation projects. During the quarter, Tecnoglass returned $16.5 million USD to shareholders through share repurchases and paid $6.7 million USD in cash dividends. As of May 7, 2026, approximately $92.5 million USD remained available under the current share repurchase program. The company ended the quarter with total liquidity of approximately $425.0 million USD, comprising $91.1 million USD in cash and cash equivalents and more than $330.0 million USD in revolving credit facility availability, against total debt of $200.3 million USD.

The company’s order backlog reached a record $1.36 billion USD at quarter-end, up 19.1% year-over-year, extending multi-family and commercial pipeline visibility into 2027. Tecnoglass cited continued expansion of its dealer network and showroom footprint as supporting geographic diversification and market share gains, with vinyl product lines identified as an incremental growth driver broadening the company’s addressable market.

José Manuel Daes, chief executive officer, commented on the results: “First quarter results were in line with our expectations, with resilient performance across our key metrics reflecting the continued strength of our vertically integrated business model despite a dynamic cost environment. Demand for our product offerings remains strong, as demonstrated by another quarter of record backlog and healthy order activity, with momentum continuing into the second quarter. Our previously announced pricing actions are now in place, and the broad-based nature of industry cost pressures supports our confidence in executing these increases while preserving our competitive positioning.”

Christian Daes, chief operating officer, addressed the tariff response and the company’s assessment of a potential US manufacturing presence. “Our pricing initiatives and cost mitigation efforts are well underway, including logistics improvements, further automation across our operations, and ongoing supply chain optimization,” he said. “We are also advancing our assessment of a proposed US manufacturing initiative, with a well-located site identified and significant state and local incentives secured that strengthen the project’s potential economics if we decide to move forward based on market demand.”

Santiago Giraldo, chief financial officer, reaffirmed full-year 2026 guidance and outlined the company’s tariff offset timeline. “Based on our strong execution to start the year, we are reiterating our full year revenue outlook in the range of $1.06 billion to $1.13 billion USD and Adjusted EBITDA outlook in the range of $225 million to $245 million USD,” Giraldo said. “This reflects the impact of the recently implemented 10% tariff on finished aluminum window imports as previously disclosed, which is expected to be partly offset in 2026 through pricing actions effective on orders from early May forward, with additional efficiency initiatives from logistics optimization and automation underway and expected to begin contributing benefits by year end. We see a clear path to fully offsetting the impact of tariffs in 2027, when full-year pricing across both businesses and incremental automation savings are expected to be realized.”

On the corporate structure front, Tecnoglass’ board of directors has approved a plan to redomicile the company from the Cayman Islands to the United States, subject to shareholder approval. If approved, the redomiciliation is expected to be completed during Q2 2026. The company stated that the move is intended to simplify its organizational and regulatory structure, improve the tax efficiency of dividend distributions, and expand its potential investor base to include funds and accounts limited to US-domiciled securities. Tecnoglass will retain its Miami, Florida headquarters following the change.

Separately, the company is conducting a feasibility study for a potential new US manufacturing facility. A site meeting project specifications has been identified and substantial state and local tax credits have been secured. The proposed facility is described as highly automated and intended to support future growth while also improving lead times, reducing transportation costs for certain markets, enhancing supply chain efficiency, and enabling the company to compete for Buy America-eligible projects and rapid-turnaround contracts. Tecnoglass expects to complete the purchase of land for the potential facility during Q2 2026, at an estimated cost of $20 million to $25 million USD to be financed through available credit facilities. The company noted that the land purchase does not constitute a commitment to proceed with construction, which would occur in phases contingent on demand, market conditions, and return profiles. The company’s 5.8-million-square-foot vertically integrated manufacturing complex in Barranquilla, Colombia, would continue to serve as its primary production base.

Above photo: Tecnoglass facilities in Barranquilla

New 10% tariff on finished aluminum windows forces EBITDA revision of ~$50M

Barranquilla-based window and architectural glass manufacturer Tecnoglass, Inc. (NYSE: TGLS) has revised its full-year 2026 financial guidance following the April 2 announcement of updated US trade policy that introduced a 10% tariff on finished aluminum window products imported into the United States.

The company stated that its first quarter 2026 performance was in line with internal expectations, supported by continued order activity and a record project backlog. Those results, the company indicated, support the continuation of its previously stated expectation of strong double-digit full-year revenue growth. However, the tariff development — which was not incorporated into the original 2026 guidance issued February 26, 2026 — required a revision to Adjusted EBITDA projections.

“We are executing at a high level to start 2026, with first quarter performance in line with our expectations and continued strength across our residential and commercial platforms. Our record backlog and strong order activity provide excellent visibility, and we continue to gain market share supported by our differentiated vertically integrated model and industry-leading cost structure. The developments in U.S. trade policy applicable to aluminum-containing imports do not reflect any change in our competitive positioning or underlying demand environment. We have proactively restructured our supply chain over the past several years to significantly reduce raw material tariff exposure, and our platform remains advantaged within our industry,” said CEO José Manuel Daes.

Tecnoglass is now guiding for full-year 2026 Adjusted EBITDA in the range of $225 million USD to $245 million USD. The updated range reflects an estimated net incremental impact of approximately $50 million USD compared to the midpoint of the company’s previously stated guidance, attributable to the newly applied 10% tariff on certain finished aluminum window imports into the US market.

The April 2 White House announcement updated Section 232 metals tariffs on steel, aluminum, and copper imports, and expanded the applicability of those tariffs to finished goods and certain derivative products containing those metals. The action affects Tecnoglass and other aluminum window exporters that ship products into the United States.

In response, Tecnoglass says it has implemented pricing adjustments effective on orders placed beginning in early May, the benefit of which is expected to materialize in the second half of 2026. The company is also advancing operational efficiency measures including logistics improvements, increased automation, and workforce adjustments. The revised guidance also accounts for the potential effect of sustained elevated aluminum prices in the second half of the year.

“The developments in US trade policy applicable to aluminum-containing imports do not reflect any change in our competitive positioning or underlying demand environment. We have proactively restructured our supply chain over the past several years to significantly reduce raw material tariff exposure.” – CEO José Manuel Daes

Santiago Giraldo, Chief Financial Officer of Tecnoglass, added, “The change to our full year 2026 Adjusted EBITDA expectations is entirely a result of the revised U.S. tariff framework, which was not contemplated in our original guidance. We have already announced pricing actions that will start with orders in early May, and we are advancing additional efficiency initiatives, including automation and logistics optimization, to further mitigate the anticipated net impact of tariffs disclosed today. These actions, combined with our strong margin profile and disciplined cost management, position us to partially offset the tariff impact as we move through the year and fully neutralize it in 2027. Our updated outlook reflects this discrete policy-driven headwind and does not change our confidence in the trajectory of the business. We remain well positioned to drive growth, expand margins over time, and continue delivering industry-leading financial performance.”

A more comprehensive update, including first quarter results and a full restatement of 2026 guidance, is expected in early May.

Tecnoglass operates a 5.8 million square foot vertically integrated manufacturing complex in Barranquilla, Colombia, and counts the United States as its dominant market, representing approximately 95% of total revenues. The company describes itself as the second-largest glass fabricator serving the US market and the largest architectural glass transformation company in Latin America. Its products have been specified for notable projects including One Thousand Museum and Paramount in Miami, Salesforce Tower in San Francisco, and Aeropuerto Internacional El Dorado in Bogotá.

The company announced a 36% increase in its quarterly dividend, raising it to $0.15 per share, and simultaneously expanded its share repurchase program to $100 million.

The expansion in revenue was multifaceted, demonstrating strength in both the residential and commercial sectors. The single-family residential segment experienced the most substantial acceleration, delivering a 25% year-over-year revenue jump. Concurrently, the multi-family and commercial revenues contributed a solid 4.6% increase to the top line.

This strong growth translated directly to enhanced profitability. The company’s gross margin expanded to 45.8%, up from 43% a year earlier. This margin expansion, considered a key indicator of operating efficiency, is a direct result of Tecnoglass’ vertically integrated structure, which allows it to control the production lifecycle, minimize input costs, and rapidly adjust to shifts in market dynamics. The firm’s ability to drive efficiency was further evidenced by the substantial increase in its adjusted EBITDA, which rose to $81.4 million, representing 34.2% of total revenue. This figure was also bolstered by a $2.1 million contribution from the company’s joint venture with Saint-Gobain (SGO on Euronext Paris, GOB on SIX Swiss Exchange). Net income for the quarter reached $49.5 million, translating to $1.05 per diluted share.

Operational Efficiency and Backlog Strength

Chief Executive Officer José Manuel Daes attributed the strong financial metrics to the firm’s strategic focus on cost management and operational agility. “Our ability to control costs and adapt swiftly… drove strong gross profit and Adjusted EBITDA growth this quarter,” Daes stated, citing ongoing automation and manufacturing upgrades as central to Tecnoglass’ capacity to meet escalating demand from the construction industry.

Chief Operating Officer Christian Daes highlighted the structural advantages driving long-term confidence. He noted that the company’s vertically integrated platform is fundamental to ensuring high quality, leveraging operating efficiencies, and enabling quick adaptation to customer needs. This foundation has enabled Tecnoglass to build a massive commercial buffer: a $1.04 billion order backlog. This marks the 30th consecutive quarter of backlog growth, which management sees as a solid basis for its confidence in sustained demand.

Capital Strategy Reinforces Shareholder Value

Following a comprehensive review of strategic alternatives, Tecnoglass’ Board of Directors reaffirmed its commitment to a long-term growth strategy centered on organic market expansion and maximizing cash flow generation. This strategic dedication to profitable growth was immediately followed by a tangible commitment to shareholder returns. The company announced a 36% increase in its quarterly dividend, raising it to $0.15 per share, and simultaneously expanded its share repurchase program to $100 million. The board cited the company’s vertically integrated model, its advantageous geographic location, and its robust cash flow generation as the primary drivers underpinning this commitment to distributing value.

The quarter demonstrated significant financial health, with Tecnoglass reporting strong cash flow of $41.5 million. This robust liquidity allowed the company to execute a $17.5 million loan prepayment, while still maintaining approximately $290 million in total liquidity. The result is a fortified balance sheet and a record low net leverage ratio of 0.01x, giving the company substantial financial flexibility moving forward.

Revised Outlook Points to Continued Outperformance

Based on its third-quarter performance and sustained market momentum, Tecnoglass revised its full-year 2024 guidance. The company now projects annual revenues to be between $880 million and $900 million, alongside an Adjusted EBITDA forecast of $270 million to $280 million.

Chief Financial Officer Santiago Giraldo emphasized management’s confidence in continued market share gains, driven by a strategy focused on geographic expansion, increased production capacity for vinyl windows, and the inherent resilience of its operations. Moving forward, Tecnoglass aims to sustain its above-market growth rates and robust margins by capitalizing on favorable demographic trends, opening new showrooms, and increasing focus across its key residential and commercial markets. The combination of a strong balance sheet and an extensive backlog positions Tecnoglass to maintain its status as a market outperformer.

Above photo: The Wynn Miami is clad in glass from Tecnoglass. Photo credit: Tecnoglass.

Under the amended terms, interest on borrowings will be the Secured Overnight Financing Rate (SOFR) with no floor, plus a spread of 1.25%. This represents a reduction from the prior spread of 1.50%, based on the company’s net leverage ratio.

Santiago Giraldo, Tecnoglass’s chief financial officer, commented on the change, stating, “The overwhelming support from our blue-chip banking syndicate, achieving almost twice as much in commitments versus the proposed facility amount, combined with the exceptional pricing we achieved, demonstrates the confidence in our strategic direction and operational excellence.” Giraldo added, “The expansion of our committed facility by over three times to $500 million, coupled with the five-year maturity extension to 2030, provides us with strong financial flexibility to capitalize on robust growth opportunities, particularly with our US expansion efforts, while maintaining our disciplined approach to achieving above-industry returns on invested capital. With our strong record of cash generation and this enhanced facility, we maintain one of the strongest balance sheets in our industry.”

Tecnoglass Inc. (NYSE: TGLS) produces aluminum and vinyl windows and architectural glass for the multifamily, single-family, and commercial end markets. Operating from a vertically integrated manufacturing complex in Barranquilla, Colombia, the company serves customers in North, Central, and South America, with the United States accounting for 95% of its total revenues. Tecnoglass products have been used in properties such as One Thousand Museum in Miami, Salesforce Tower in San Francisco, and Hub50House in Boston.

The credit facility was arranged by Wells Fargo Bank N.A. as administrative agent. The joint lead arrangers included BMO Bank N.A., Citibank N.A., Citizens Bank N.A., First Citizens Bank & Trust Company, and J.P. Morgan Chase Bank N.A.

Wynn, Miami. Photo credit: Tecnoglass.

Plano, Texas. Photo credit: Tecnoglass.

Detailed Financial Performance Analysis

Tecnoglass’ second-quarter financial statements indicate a company in a strong financial position. A closer examination of the results provides insights for the institutional investor.

Income Statement Analysis:

Revenue Growth: The 16.3% increase in total revenue to $255.5 million USD was primarily driven by a 17.8% growth in the multifamily/commercial sector and a 14.5% increase in the single-family residential sector. The company attributes this to market share gains, geographic expansion, and a broader product offering. A portion of the single-family residential growth is attributed to customers accelerating orders in anticipation of price increases related to US tariffs. The impact of foreign currency exchange was a modest adverse effect of $0.5 million.

Profitability Metrics: The gross margin expanded by 400 basis points to 44.7% from 40.8% in the prior-year quarter. This improvement reflects better pricing, stable raw material costs, operating leverage, and increased vertical integration. Operating expenses increased to $53.1 million USD from $38.4 million USD in Q2 2024, primarily due to higher selling expenses, including $5.9 million in aluminum tariffs paid in April. As a percentage of revenue, operating expenses were 20.8%, up from 17.5%. The company notes that price adjustments implemented in May began to offset these incremental expenses by late June.

Photo credit: Tecnoglass.

Net Income and Earnings Per Share: Net income for the quarter was $44.1 million USD, or $0.94 USD per diluted share, compared to $35.0 million USD, or $0.75 USD per diluted share, in the same period last year. Adjusted net income, a non-GAAP measure that excludes items like non-cash foreign currency exchange gains and losses, was $48.5 million USD, or $1.03 USDper diluted share.

Adjusted EBITDA: Adjusted EBITDA, another non-GAAP measure, increased by 24.5% to $79.8 million USD, representing 31.2% of total revenues. This was driven by higher revenues and gross margin improvement, which more than offset the aforementioned increase in operating expenses. The Adjusted EBITDA calculation for the quarter includes a $0.5 million USD contribution from the joint venture with Saint-Gobain.

Balance Sheet and Cash Flow:

Strong Liquidity: The company ended the quarter with a solid liquidity position of approximately $310 million USD, consisting of $137.9 million USD in cash and cash equivalents and $170.0 million available under its committed revolving credit facilities. The total debt stood at $109.2 million USD.

Cook County Central Campus Health Center, Chicago. Photo credit: Tecnoglass.

Cash Flow from Operations: Cash generated by operating activities was $17.9 million USD for the quarter. This figure was impacted by the seasonal timing of tax payments.

Capital Expenditures (Capex): Capex for the quarter was $32.5 million USD, which included scheduled payments for previous investments and $15.1 million USD for the acquisition of Continental Glass assets classified as property, plant, and equipment.

Shareholder Returns: The company returned $7.0 million to shareholders through dividends during the quarter and has approximately $76.5 million remaining under its current share repurchase program.

Project Backlog: The company’s project backlog grew to a record $1.2 billion USD, a 17.2% year-over-year increase, providing visibility into projects for the next two years.

US Market Expansion and Operational Strategy

Tecnoglass is actively pursuing an expansion strategy within the United States market. The acquisition of assets from Continental Glass Systems for approximately $30 million USD is a key part of this strategy, adding manufacturing capabilities and a project backlog in the southeastern US.

Santiago Giraldo. Photo credit: Tecnoglass.

The company is also set to open a new showroom on the West Coast to introduce its “Legacy” aluminum product line, aimed at supporting its geographic expansion. Furthermore, a feasibility study is underway for a new automated manufacturing plant in the United States, with two potential sites identified in Florida. This facility is intended to address expected growth beyond current installed capacity and to improve delivery times and supply chain efficiencies.

Navigating US Trade Policy

The company has acknowledged the impact of US tariffs on aluminum, which contributed to higher operating expenses. In response, Tecnoglass has adjusted its supply chains and implemented price increases to mitigate the financial impact. This reflects a proactive approach to managing the risks associated with evolving trade policies.

Christian Daes (right). Photo credit: Tecnoglass.

Environmental, Social, and Governance (ESG) Initiatives

Tecnoglass has integrated ESG principles into its corporate strategy. The company has a stated goal of carbon neutrality and has invested in sustainability initiatives, including a large-scale solar panel installation and a natural gas cogeneration project. A significant portion of the company’s revenues is from “green revenues” generated by its energy-efficient products.

Through the Tecnoglass ESWindows Foundation, the company is also engaged in social initiatives in its home base of Barranquilla, Colombia, focusing on community development. Tecnoglass has also received recognition for its corporate governance practices.

In summary, Tecnoglass’ second-quarter results demonstrate solid financial performance and a clear strategy for growth in the US market. The company’s detailed financial reporting provides a transparent view of its operations and its approach to managing both opportunities and challenges in the current economic and political environment.

The company’s full-year revenues increased by 6.8%, reaching $890.2 million USD, attributed to organic growth, geographic expansion, and entry into the vinyl market. Single-family residential revenue grew by 10.9% year-over-year to $372.1 million USD. Net income for 2024 was $161.3 million USD, or $3.43 USD per diluted share, with adjusted net income at $171.6 million USD, or $3.65 USD per diluted share. Adjusted EBITDA stood at $275.8 million USD, representing 31.0% of revenues, while gross profit was $380.0 million USD, accounting for 42.7% of revenues.

In the fourth quarter, revenues rose by 23.1% to $239.6 million USD compared to the same period in the previous year. Multifamily and commercial revenues increased by 24.3%, and single-family residential revenues grew by 21.3%. Gross profit for the quarter was $106.5 million USD, with a gross margin of 44.5%. Net income for the quarter was $47.0 million USD, or $1.00 USD per diluted share, and adjusted net income was $49.3 million USD, or $1.05 USD per diluted share. Adjusted EBITDA for the quarter was $79.2 million USD, or 33.1% of total revenues.

Tecnoglass reported record cash flow from operations, with $61.1 million USD in the fourth quarter and $170.5 million USD for the full year, representing 61.8% of adjusted EBITDA for the year. Tecnoglass reduced its debt by $65 million USD throughout 2024, achieving a net cash position by year-end. The backlog expanded by 27.6% year-over-year to a record $1.1 billion USD. Additionally, the company returned $19.7 million USD to shareholders through dividend payments during the year.

CEO José Manuel Daes stated, “I am thrilled with our performance in 2024, as we delivered another year of record results driven by market share gains in our single-family residential business, continued momentum in multifamily/commercial demand, and the operational advantages of our vertically integrated business model.” He also noted the company’s resilience despite currency headwinds and highlighted its strong capital position.

COO Christian Daes commented on the robust demand across end markets and the company’s record backlog, providing visibility well into 2026. He acknowledged potential risks associated with proposed US tariffs on aluminum imports but expressed confidence in mitigating negative impacts through identified actions and favorable pricing environments.

CFO Santiago Giraldo provided the 2025 outlook, projecting revenues between $940 million USD and $1.02 billion USD, representing approximately 10% growth at the midpoint. The adjusted EBITDA target is set between $300 million USD and $340 million USD, with an implied adjusted EBITDA margin of 32.7% at the midpoint. This outlook assumes stable Colombian peso exchange rates, continued momentum in vinyl-related revenues, and stable activity in short-term commercial projects. Giraldo expressed confidence in delivering another year of profitable growth.

Tecnoglass Inc. is a producer of aluminum and vinyl windows and architectural glass, serving multifamily, single-family, and commercial end markets. Based in Barranquilla, Colombia, the company’s manufacturing complex provides access to nearly 1,000 customers in North, Central, and South America, with the United States accounting for 95% of total revenues. Tecnoglass products are featured in properties such as One Thousand Museum and Salesforce Tower.

Headline Image Credit: Tecnoglass Inc.

Gross margin reached 45.8%, up from 43% a year prior, a reflection of Tecnoglass’ efficiency and its vertically integrated model, which minimizes costs and adjusts quickly to market shifts. CEO José Manuel Daes remarked, “Our ability to control costs and adapt swiftly… drove strong gross profit and Adjusted EBITDA growth this quarter.” He cited automation and manufacturing upgrades as central to Tecnoglass’ capacity to meet increasing demand.

Demand was strong across multiple segments. Chief Operating Officer Christian Daes highlighted, “Our vertically integrated platform ensures a high level of quality, leverages operating efficiencies, and enables quick adaptation…” He underscored the company’s $1.04 billion backlog, marking the 30th consecutive quarter of backlog growth, as a foundation for its confidence in long-term demand.

The company’s Adjusted EBITDA increased to $81.4 million, representing 34.2% of revenue, bolstered by a $2.1 million contribution from its joint venture with Saint-Gobain. Net income stood at $49.5 million, or $1.05 per share.

Capital Strategy and Shareholder Returns

Following a strategic alternatives review, Tecnoglass’ Board affirmed its commitment to a long-term growth strategy. This plan includes organic market expansion and cash flow-focused operations. Additionally, Tecnoglass increased its quarterly dividend by 36% to $0.15 per share and expanded its share repurchase program to $100 million, reinforcing its dedication to shareholder returns. The board cited the company’s vertically integrated model, advantageous geographic location, and robust cash flow as drivers of continued success.

Tecnoglass reported strong cash flows of $41.5 million for the quarter, enabling a $17.5 million loan prepayment and maintaining liquidity of approximately $290 million. The company’s balance sheet remains solid, with a record low net leverage ratio of 0.01x.

Full-Year Outlook

Tecnoglass revised its 2024 guidance, projecting annual revenues between $880 million and $900 million and Adjusted EBITDA of $270 million to $280 million. Chief Financial Officer Santiago Giraldo emphasized the company’s confidence in sustained growth, driven by geographic expansion, increased vinyl window production, and its resilient operations.

Looking Forward

Tecnoglass aims to build on its recent growth through new showroom openings and increased focus on residential and commercial markets. Its strategies reflect confidence in demographic trends favoring its core segments, which, alongside a fortified balance sheet and extensive backlog, position Tecnoglass to maintain above-market growth and robust margins.

Above photo: Christian Daes & Jose Manuel Daes (R) of Tecnoglass Photo credit – https://imgur.com/user/josemanueldaes

Tecnoglass serves multi-family, single-family and commercial end markets, and is the second largest glass fabricator serving the U.S.  With production facilities located in Barranquilla, Colombia, the company’s 2.7 million square foot, vertically integrated manufacturing complex serves over 1,000 global customers, with the U.S. accounting for more than 90% of revenues.

Tecnoglass’ tailored, high-end products are found on some of the world’s most distinctive properties, including One Thousand Museum (Miami), Paramount (Miami), Salesforce Tower (San Francisco), Via 57 West (NY), Hub50House (Boston), Aeropuerto Internacional El Dorado (Bogotá), One Plaza (Medellín), Pabellon de Cristal (Barranquilla).

Gross profit in the quarter was also down, coming it $74.7 million USD (on a 38.8% gross margin) versus the $107.8 million USD (53.2% gross margin) reported in the first three months of 2023.

“The year-over-year change in gross margin reflected an unfavorable foreign exchange impact of nearly 800 basis points, reduced operating leverage on lower revenues, promotional activity on single-family residential products and an increased mix of installation and stand-alone product sales during the quarter partially related to the step down in single family activity during the period,” noted the company in an announcement accompanying its results.

Margins also continue to be affected by the “cash effect of a strong Colombian peso revaluation of approximately 18% year-over-year” as well as “non-cash effect related to an inventory mark-up associated with the valuation of inventory from when it was purchased in the fourth quarter of 2023 to when it was sold in the first quarter of 2024,” added Tecnoglass.

“The non-cash portion of the unfavorable currency effect during the quarter contrasted with a positive effect during the first quarter of 2023 and is related to the accounting of inventories in Pesos as the functional currency. On a sequential basis, gross margin compared to 42.6% in the fourth quarter of 2023 and was also impacted by a sequential Peso revaluation of approximately 5%.”

José Manuel Daes, chief executive officer of Tecnoglass, acknowledged the challenging environment and highlighted some of the positive news reflected in the results.

“I am proud of our team’s resilience to started off 2024,” he said. “In light of macroeconomic challenges, we maintained a steady course with our multi-family/commercial business executing against our record backlog while our single-family residential sales channel experienced inflationary constraints on consumer spending. That said, we were highly encouraged to see record levels of single-family residential orders during March and April, which we believe signals a positive shift in demand as we move into the second quarter.”

Commercial revenues were also up slightly, in line with scheduled project deliveries. Lower single-family residential revenues were impacted by slower activity resulting from end consumers experiencing higher interest rates and mortgage rates. Changes in foreign currency exchange rates had an adverse impact of $0.9 million on total revenues in the quarter.

These factors have led the executive to stay positive about a range of opportunities and strategic plans ahead in the 2024.

“We remain optimistic on the strength of our business, bolstered by vigorous quoting activity for our innovative vinyl windows and other offerings, strong customer partnerships, and substantial opportunities for geographic expansion in 2024 and beyond,” added Daes.

For his part, Christian Daes, the company’s chief operating officer, stressed the value of adaptability and said he expects deliveries to increase in the back half of the year.

“Our performance in the first quarter reflects our adaptability amidst a dynamic operating landscape,” he said. “We ended the quarter with another record multi-year backlog of $916 million, reflecting an expanding pipeline for multi-family/commercial projects into 2025.”

“Customer interest in our vinyl products continues to look very encouraging based on quoting activity,” added Christian, “and we are on track for deliveries to increase in the second half of 2024. Our strong backlog, strategic investments to broaden our product portfolio, and our best-in-class manufacturing capabilities give us confidence in our ability to drive further value creation in our business as we move forward.”

Photo: A Tecnoglass employee working in the company’s factory in Barranquilla, Colombia. (Photo credit: Liliana Padierna)

Overall, it reported net income of $183.5 million USD and a record full-year gross profit of $390.9 million USD, which supported the board’s decision to approves a 22% increase in quarterly dividend to $0.11 USD per share.

For the fourth quarter, revenues were down year-over-year, falling 7.8% to $194.6 million USD compared to $211.1 million USD in the prior-year fourth quarter. Gross profit fell as well, coming in at $83.0 million USD, for a 42.6% gross margin, in the final three months of 2023, a drop from the $110.2 million USD and 52.2% gross margin over the same period in 2022.

Despite the relatively down news for the quarter, the company executives remain focused on the record-setting full-year results and see positive signs for a similarly promising 2024.

“We are confident that 2024 will be another year of double-digit revenue growth,” said Santiago Giraldo, chief financial Officer of Tecnoglass, in the firm’s results announcement.

He noted the uncertainty ahead, given the macroeconomic conditions and current rate environment in the United States, but said the company remains “confident in our ability to outperform our end markets” and expects more share gains, “solid growth,” and cash flow generation in the year to come.

“While our year-over-year margins were impacted by the sharp appreciation of the Colombian peso during the second half of 2023, we delivered industry-leading adjusted EBITDA margins in excess of 35% for the year,” said José Manuel Daes, chief executive officer of Tecnoglass, in the firm’s results announcement.

“Our strong margin performance is attributable to our previously implemented high return automation and capacity enhancements as well as our disciplined cost control efforts,” he added. “Additionally, the structural enhancements in our business, along with our prudent working capital management, helped us generate another year of exceptional cash flow. Our solid capital position has given us flexibility to invest in further structural enhancements, increase our cash dividend, return value to our shareholders through share repurchases, and improve our leverage profile with net debt to adjusted EBITDA ending the year at a record low of 0.1x.”

Photo credit: Tecnoglass