Tecnoglass Inc. Ordinary Shares

Good day and welcome to the Technoglass Inc. Second Quarter 2024 Earnings Conference Call. All participants will be in the listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on a touch-tone phone. To withdraw your question, please press star, then two. Please note, this event is being recorded. I would now like to turn the conference over to Brad Cray from Investor Relations. Please go ahead.

Thank you for joining us for Technoglass' second quarter 2024 conference call. A copy of the slide presentation to accompany this call may be obtained on the Investor section of the Technoglass website. Our speakers for today's call are Chief Executive Officer Jose Manuel Diaz, Chief Operating Officer Chris Diaz, and Chief Financial Officer Santiago Geraldo. I'd like to remind everyone that matters discussed in this call, except for historical information, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding future financial performance, future growth, and future acquisitions. These statements are based on Technoglass's current expectations or beliefs and are subject to uncertainty and changes in circumstances. Actual results may vary in a material nature from those expressed or implied by the statements herein due to changes in economic, business, competitive, and or regulatory factors, and other risks and uncertainties affecting the operation of Technoglass's business. These risks, uncertainties, and contingencies are indicated from time to time in Technoglass's filings with the SEC. The information discussed during the call is presented in light of such risks. Further, investors should keep in mind that TechnoGlass's financial results in any particular period may not be indicative of future results. TechnoGlass is under no obligation to and expressly disclaims any obligation to update or alter its forward-looking statements, whether as a result of new information, future events, changes in assumptions, or otherwise. Finally, as previously announced on June 25th, 2024, Technoglass' board of directors is conducting a review of strategic alternatives with the assistance of outside financial and legal advisors. There is no deadline or definitive timetable set for completion of the review process, and there can be no assurance that this process will result in the company pursuing a transaction or any other particular outcome. The company does not intend to make any further public comment regarding its review until the board of directors has approved a specific course of action or the company determines that additional disclosure is appropriate or necessary. I will now turn the call over to Jose Manuel, beginning on slide number four.

Jose Manuel- Thank you, Brad, and thank you everyone for participating in today's call. We are pleased to report another quarter of strong results to close out the first half of the year. We achieved record single-family residential revenues of $95.7 million and our second highest total revenue of $219.7 million. This demonstrates the resilience and adaptability of our business model in a complex macroeconomic landscape. These accomplishments reflect the strong demand and level of orders we saw towards the end of the first quarter. We remain confident in our ability to capitalize on attractive opportunities and to gain market share despite certain challenges related to inflation and higher interest rates. Record single-family residential revenues reach a quarterly record of 95.7 million, up 10.1% year-over-year. The solid growth in our residential business reflects our ability to capitalize on the strong demand we saw at the end of the quarter, as well as improving market trends, which led to a record level of orders in the second quarter of the year. We also continue to expect vinyl orders to contribute more meaningfully during the second half of the year. Our multifamily commercial business saw sequential improvement. but was impacted by higher interest and mortgage rates during the second quarter. Despite this trend, we are seeing a substantial amount of new activity, especially on the high-rise market, as evidenced by yet another record level of backlog. We anticipate this positive trend to continue through the second half of the year. Our forward-looking optimism is supported like the significant level of orders we received in June, with residential orders up over 60% year-over-year, contributing to a record backlog of approximately $1 billion at quarter end. As a reminder, our backlog reflects the pipeline of multifamily commercial activity and firm single-family residential orders in our key geographies, providing visibility through 2025 and building into 2026. Despite some year-over-year headwinds, including unfavorable foreign exchange impacts, we were pleased to see a sequential increase in gross margin and adjusted EBITDA margin. The sequential improvement in profitability and the relative stability in exchange rates over the past several quarters, support our positive outlook. Our improved profitability also gives us confidence in our ability to navigate the evolving market landscape and continue to create value for our shareholders. The solid growth in our shorter cash cycle single-family residential business and careful work in capital management resulted in robust growth cash flow generation of $34.5 million. Impressively, this was achieved even with the timing of seasonal tax payments during the quarter. Our solid cash generation continues to provide us with additional flexibility to return value to our shareholders through our share repurchases and dividends. Our cash flow has also allowed us to enhance our operational flexibility and balance sheet through another $15 million voluntary repayment of our term loan during the quarter, totaling $30 million of debt repayments here today. Overall, we are pleased with the improvement we see in our business and we remain encouraged by recovering demand trends in our end markets. As we look To the remainder of the year, our positive growth outlook is supported by our strong customer relationships, record backlog, and innovative product portfolio. I will now turn the call over to Chris to provide additional operating highlights.