Mexican glassmaker Vitro said 26 February 2007 that it made a net profit of USD 34 million in the 4Q 2006, up from USD 18 million a year ago on higher sales and operating profit.
In a press release, …
Mexican glassmaker Vitro said 26 February 2007 that it made a net profit of USD 34 million in the 4Q 2006, up from USD 18 million a year ago on higher sales and operating profit. In a press release, Monterrey-based Vitro said sales in the quarter rose 7.7% to USD 603 million. Sales at the glass containers division increased 20.8% to USD 316 million, while flat glass sales were down 4.4% to USD 281 million. Operating profit was up 8.2% to USD 45 million, and earnings before interest, taxes, depreciation and amortization, or Ebitda, increased 3.6% to USD 94 million, the highest for a 4Q since 1999, Vitro said. The increase in net profit was mainly the result of lower financing costs, the company added. Vitro stressed the completion of its financial restructuring, which included debt reduction, non-core asset sales, and a rights offering. Net debt at the end of 2006 was down USD 191 million on the year to USD 1.03 billion, or 2.7 times Ebitda. The company said it invested USD 41 million in the 4Q, of which 81% went into the glass containers division. In the press release, Alvaro Rodriguez, chief financial officer of Vitro said, “This has been an important year for Vitro. Consolidated EBITDA for 2006, on a comparable basis, is the highest since 2000. Glass containers reached another consecutive record year, with comparable sales and EBITDA up 15% and 23%, respectively. Flat Glass performance during the year was also strong. On a comparable basis, sales rose 3.7% and EBITDA, excluding the effect of the inventory reduction, was up 20%”. “We are also pleased to report that we have delivered on the financial plan established at the end of 2005, which led to the financial transformation of Vitro in 2006. This last quarter we completed a successful rights offering and the sale of land occupied by Vimex for a total of USD 150 million. As a result, during 2006 we closed transactions to reduce debt for a total of USD 332 million, exceeding our USD 300 million target”. “Today Vitro is a much stronger company. We finalized the sale of non-core assets, reduced gross debt by USD 242 million year over year to an all time low of USD 1,141 million achieving a net debt to EBITDA ratio of 2.7 times; brought down selling and administrative expenses by 100 basis points to 19.9% during 2006”. “In January 2007 we undertook a major debt refinancing and issued a total of USD 1.0 billion in senior unsecured notes, which were more than seven times oversubscribed. This was the largest high yield-rated offering by a nongovernment owned corporate in Emerging Markets to date. Through this offering we have transformed the company“s capital structure by simplifying it, concentrating debt in a single entity and eliminating structural subordination. In addition, we significantly reduced the cost of debt and extended debt maturities to an average life of debt of nearly 8 years”. Mr. Rodriguez closed, “The last year proved to be very productive as we made major progress with the EBITDA turnaround that started in 2003, while constantly refinancing our debt. Now that the financial plan is complete and Vitro has enhanced liquidity and increased financial flexibility, it“s time to focus our energy in continuing to build a strong platform for the new Vitro story, leveraging our strengths, focusing on organic growth and building on our unique position in niche markets and value added products”.
