Lamosa acquires Roca's tiles division

Lamosa posted sales growth of 54% in the first half of 2021 and announced expansions in Brazil and Spain that will bring total production capacity to 225 million sqm/year.

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 $260 million (approximately €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 the United States.

This latest deal comes five years after the acquisition of Cerámica San Lorenzo for $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 million sqm/year. In 2020, the three acquired facilities produced a total of approximately 23.4 million square metres of tiles.

“This operation strengthens our already strong presence in North and South America and also allows us to expand in Europe,” said Lamosa’s Chairman Federico Toussaint Elosúa  (Photo on the right). “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.”

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 million sqm total in 2020), the Mexican group nevertheless managed to close the year with an increase in sales and consolidated turnover (19,473 million pesos, approximately US $978 million, +9%). This included contributions from both the Tiles division (14,720 million pesos, approximately US $740 million, +8%) and the Adhesives division (4,754 million pesos, approximately US $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 12,245 million pesos (approximately US $617 million). Sales in the Mexican market grew by 34% while exports increased by 110% to 4,264 million pesos (approximately US $215 million), or 35% of consolidated revenues.

The Tiles division reported an excellent performance, with first-half revenues up 65% on 2020 to 9,565 million pesos (approximately US $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%.