Tecnoglass — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total revenue reached a record $310.6 million, a 19.2% year-over-year increase from $260.5 million in the prior year quarter.
• Multi-family/commercial revenue grew 30.9% year-over-year to $192.4 million; single-family residential revenue grew 4.1% year-over-year to $118.1 million.
• Gross profit was $106.0 million with a 34.1% gross margin, down from $111.3 million and 42.7% in the prior year quarter.
• Net income was $22.8 million ($0.51 per diluted share), compared to $47.2 million ($1.01 per diluted share) in the prior year quarter.
• Adjusted net income was $27.3 million ($0.61 per diluted share), compared to $46.7 million ($1.00 per diluted share) in the prior year quarter.
• Adjusted EBITDA was $47.7 million (15.3% of revenue), compared to $79.1 million (30.4% of revenue) in the prior year quarter; excluding an $8.4 million non-cash inventory revaluation, Adjusted EBITDA would have been approximately $56.1 million.
• SG&A expenses increased to $74.0 million (23.8% of revenue) from $47.3 million (18.2% of revenue) in the prior year quarter, driven by $15.5 million in Section 232 tariff expenses.
• Cash provided by operating activities for the quarter was approximately $21.5 million.
• Capital expenditures were approximately $66.1 million.
• Total liquidity ended the quarter at $380 million, comprising $97.7 million in cash and cash equivalents and $280 million in availability under revolving credit facilities.
• Total debt was $293.6 million, resulting in a net debt to LTM Adjusted EBITDA leverage ratio of approximately 0.9x.
• Changes in foreign currency exchange rates provided a $2.4 million benefit to total revenues.

Guidance and Future Outlook:

• Full-year 2026 revenue guidance was raised to a range of $1.10 billion to $1.14 billion.
• Full-year 2026 Adjusted EBITDA guidance was adjusted to a range of $210 million to $220 million; excluding the non-cash inventory revaluation, the outlook would have been approximately $8.4 million higher.
• Management expects to fully offset the impact of tariffs in 2027 through automation savings and full-year pricing realization.
• Pricing actions implemented in May are expected to flow through multi-family and commercial revenue starting with shorter-cycle jobs late in the year and larger projects during 2027.
• The company remains committed to growing well above industry rates and unlocking additional value for shareholders.

Business Segments and Product Lines:

• Multi-family and commercial business drove 31% growth, fueled by execution on a record backlog.
• Single-family residential growth was 17% year-over-year excluding pre-buy activity from the second quarter.
• The company opened a Los Angeles showroom to bring Legacy Line aluminum windows to the West Coast.
• The company continues to book large projects in the luxury lodging and condo markets, including its largest project to date signed subsequent to the quarter end.
• Automation initiatives are taking hold, contributing to operational efficiency.
• The expanding dealer network and vinyl lines are supporting market share gains in single-family residential projects.

Market and Competitive Landscape:

• The company achieved all-organic growth driven by continued market share gains and geographic expansion outside of Florida.
• The backlog expanded 13.2% year-over-year to a record $1.43 billion.
• The company is the second largest glass fabricator serving the U.S. and the #1 architectural glass transformation company in Latin America.
• Approximately 95% of total revenues are generated from the United States.

Risks and Challenges:

• Gross margins were pressured by elevated aluminum costs, ongoing tariffs, and a Colombian Peso at its strongest level since 2018.
• A stronger Colombian Peso (appreciating approximately 20% year-over-year) drove approximately 580 basis points of the 860 basis point decline in gross margin.
• Roughly 250 basis points of the margin decline was attributed to a non-cash inventory revaluation of approximately $8.4 million.
• Higher raw material costs from U.S. aluminum purchased at peak prices earlier in the year impacted margins.
• Unfavorable mix from a higher level of installation revenue and higher labor costs related to the annual minimum wage adjustment in Colombia affected results.
• Non-cash foreign exchange transaction losses of $3.3 million impacted net income in the quarter.

Management Commentary and Tone:

• CEO José Manuel Daes expressed pleasure at delivering record revenues and noted that higher volumes drew on aluminum purchased at peak prices, though lower levels have since been secured.
• Management stated that excluding the non-cash inventory revaluation, Adjusted EBITDA was ahead of internal expectations.
• COO Christian Daes highlighted the record backlog and consistent execution on a growing pipeline of multi-family and commercial projects.
• CFO Santiago Giraldo stated the company remains well-positioned to invest in growth while returning capital to shareholders due to a conservative debt profile and strong cash generation.
• The tone was confident regarding the ability to unlock value and offset tariff impacts in 2027.

Other Key Points:

• The company returned $6.7 million in cash dividends to shareholders during the quarter.
• As of September 30, 2026, approximately $92.5 million remained under the current share repurchase program.
• In August, the company completed the $23 million purchase of land in St. Lucie County, Florida, for a potential new manufacturing facility.
• The feasibility study for the potential new facility remains active and does not represent a commitment to proceed with construction.
• The company has secured state, local, and utility incentives expected to significantly enhance returns if the project meets its parameters.
• The company signed its largest project to date subsequent to the quarter end, providing strong visibility for the next few years.