Tecnoglass (NASDAQ: TGLS) reported Q3 EPS of $0.24, $0.07 better than the analyst estimate of $0.17. Revenue for the quarter came in at $97 million versus the consensus estimate of $92.74 million.

• Raises Full Year 2018 Outlook for Total Revenues and Adjusted EBITDA1 to a range of $360-$370 million and $79-82 million, respectively
• Record Backlog of $506 Million; Up 3.6% Year-over-Year
• Total revenues increased 16% to $97.0 million on strong U.S. activity, marking the 6th consecutive quarter of record revenues
• Net income of $6.3 million, or $0.16 per diluted share, including non-cash FX losses during the period
• Adjusted net income1 increased to $9.3 million, or $0.24 per diluted share, excluding non-cash FX losses and non-recurring costs in both periods
• Adjusted EBITDA1 grew 29% to $22.8 million
• In October 2018, announced strategic alliance with Schüco USA LLLP, enabling Tecnoglass to manufacture and sell Schüco’s architectural systems in North America and Latin America

José Manuel Daes, Chief Executive Officer of Tecnoglass, commented, "Gross margin improved to 35.8% and Adjusted EBITDA margin grew to 23.5% during the third quarter, further validating our vertically-integrated model, highly-efficient manufacturing capacity and sustainable access to talented employees. In addition, we are carefully balancing volume and price with a focus on margin enhancement as we continue to penetrate the US market. In the US, we achieved our 15th straight quarter of double-digit revenue growth year-over-year, reflecting our commitment to expanding our customer base, geographic presence, product portfolio and category exposure, including residential sales up over three times. The US represented 85% of total revenues during the quarter and is poised to remain a significant contributor to our growth trajectory based on the attractive mix of projects in backlog. In Colombia, while activity was soft during the quarter, sales were up 9% through the first nine months of 2018 and we ended the quarter with a stronger backlog in that region. Overall, we are very pleased with the continued strength of our industry-leading margin business and look forward to delivering on our upwardly revised outlook for full year 2018.”

Christian Daes, Chief Operating Officer of Tecnoglass, stated, “Commercial activity in the US remains favorable, particularly for impact-­resistant windows in coastal states and for energy-efficient architectural systems more broadly. During the past several years we have invested heavily in R&D to stay ahead of these evolving trends, allowing us to gain US market share, which we expect to continue. Our recent alliance with Schüco is another positive step, which provides us with a new global customer while also equipping us with a new suite of cutting-edge products to manufacture and sell through existing distribution networks. These top line catalysts are further supported by a more favorable pricing environment in the U.S. resulting from production and labor cost inflation for U.S based manufacturers. As we look forward, we are focused on continuous improvement across all aspects of our business, and see a range of opportunities to improve our position as a leader of high quality architectural products and innovative solutions.

GUIDANCE:

Tecnoglass sees FY2018 revenue of $360-370 million, versus the consensus of $360.82 million.

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