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Lamosa Acquires Roca’s Tiles Division

Thursday, September 23, 2021

Grupo Lamosa, Mexico’s largest ceramic manufacturing group and one of the top three global players, has taken another important step forward in its international growth plan. On 2 August, it announced an agreement with Grupo Roca for the acquisition of the Spanish company’s Ceramic Tile Division (Tiles Investments and Holdings), a transaction worth USD 260 million (approximately EUR 221 million) that covers three production plants: the two Incepa plants in Brazil (Campo Largo and São Mateus do Sul) and the Ceramica Belcaire plant in Castellón, Spain, as well as a sales company in USA.

This latest deal comes five years after the acquisition of Cerámica San Lorenzo for USD 230 million, a move that transformed the San Pedro Garza García-based group into a multinational with operations spanning Argentina, Chile, Colombia and Peru.

While the sale of its tile division is part of the Roca Group’s strategy of concentrating its activities and growth in the bathroom furnishings sector following its recent acquisitions of the Spanish Royo Group, the German company Sanit and a sanitaryware factory in Brazil, for Grupo Lamosa the acquisition will bring an approximately 20 % increase in consolidated revenues and a 16 % boost in installed capacity to 225 Mm2/y. In 2020, the three acquired facilities produced a total of approximately 23,4 Mm2 of tiles.

“This operation strengthens our already strong presence in North and South America and also allows us to expand in Europe. It also represents an important step forward in the Group’s growth path in line with its strategic development plan to expand its geographical presence, diversify risks and further strengthen its positioning and leadership through a search for new opportunities,” said Lamosa’s Chairman Federico Toussaint Elosúa.

Today, Grupo Lamosa has 16 facilities (9 in Mexico, 3 in Peru, 2 in Argentina and 2 in Colombia, including Euroceramica which was acquired in 2020) and 13 adhesives manufacturing plants in Mexico, Chile and Guatemala.

Although last year’s lockdowns reduced production volumes (148 Mm2 total in 2020), the Mexican group nevertheless managed to close the year with an increase in sales and consolidated turnover (MXN 19 473 million, approximately USD 978 million, +9 %). This included contributions from both the Tiles Division (MXN 14 720 million, approximately USD 740 million, +8 %) and the Adhesives Division (MXN 4754 million, approximately USD 239 million, +9 %). EBITDA also increased by 20 % with EBITDA margin reaching 22 % of sales.

But what Lamosa’s management describes as “extraordinary” are the results for the first half of 2021 in terms of both sales (+54 %) and margins (EBITDA up 189 % and an EBITDA margin of 28 %). The recovery of construction and renovation activity in Mexico and the greater dynamism of the South American markets fuelled a sharp increase in sales, which reached MXN 12 245 million (approximately USD 617 million). Sales in the Mexican market grew by 34 % while exports increased by 110 % to MXN 4264 million (approximately USD 215 million), or 35 % of consolidated revenues.

The Tiles Division reported an excellent performance, with first-half revenues up 65 % on 2020 to MXN 9565 million (approximately USD 482 million, 78 % of consolidated sales), driven by a recovery in demand in the group’s target markets and the incorporation of the Colombian company Eurocerámica. The division’s EBITDA also improved significantly, up 249 % on the first half of 2020, while EBITDA margin increased from 14 % to 29 % of revenues. The Adhesives segment also performed well, with sales up 27 % over the first half of 2020 and EBITDA up 43 %.