Vitro S.A.B. de C.V. one of the world“s largest producers and distributors of glass products, announced unaudited results for the 3Q 2007 on 26 October. Year-on-year consolidated net sales increased …
Vitro S.A.B. de C.V. one of the world“s largest producers and distributors of glass products, announced unaudited results for the 3Q 2007 on 26 October. Year-on-year consolidated net sales increased 7.1% and EBITDA declined USD 11 million or 10.5%. The consolidated EBITDA margin declined 280 basis points to 14.1% due to disruptions in production as a result of the failure in natural gas supply caused by two incidents at PEMEX pipelines. Excluding this effect, EBITDA for the quarter rose 1% to USD 106 million. Commenting on the results for the quarter, Federico Sada, chief executive officer, said: “This was another solid quarter with a strong performance at both Glass Containers and Flat Glass. In fact, excluding the impact of the interruption in natural gas supply in July and September, comparable consolidated EBITDA reached an all-time high”. “Our Glass Containers operations also posted record EBITDA during the quarter, excluding the effect of the disruption in operations,” he continued. Mr. Enrique Osorio, chief financial officer, noted that “very quick response from the Vitro team and our energy suppliers, coupled with increased efficiencies and capacity utilization reduced the impact from both incidents limiting the total net effect to approximately USD 12 million for Glass Containers and Flat Glass”. “To avoid future disruptions, we have installed a backup system in all of our containers manufacturing facilities in Mexico that will allow us to maintain the integrity of our furnaces. We are now in the process of implementing additional preventive measures at these facilities to avoid similar gas related production interruptions in the future. We also remain focused on continuing to pursue increased efficiencies and capacity utilization to partially offset this negative impact before year-end”. “At Flat Glass, we are pleased to report a 6.1% year-over-year increase in EBITDA. This is the third consecutive quarter of EBITDA growth and, on a comparable basis, the highest EBITDA recorded since 4Q 2004, despite the approximately USD 0.4 million impact from the effect of the interruption in natural gas supply at two automotive glass production facilities in September. This quarter, auto glass sales increased both for AGR and OEM. Sales growth to the OEM market reflected our strategy to increase sales of value added products and diversify our client base by focusing on Japanese manufacturers, with strong sales volume for the Nissan Sentra platform.” “We are pleased with the progress achieved as we continue to establish new EBITDA records. Going forward, we will continue to pursue our short term strategy that focuses on the move to value added products in flat glass and to build on the strengths of a strong established position, production flexibility and fast time to market to cater to profitable niche glass container markets while maintaining our leadership in the Mexican mass market”, Mr. Osorio concluded.
