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What changed in Tecnoglass Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Tecnoglass Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+199 added−232 removedSource: 10-K (2025-02-28) vs 10-K (2024-02-29)

Top changes in Tecnoglass Inc.'s 2024 10-K

199 paragraphs added · 232 removed · 154 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

51 edited+11 added−9 removed79 unchanged
Biggest changeTecnoglass earned the #1 spot on Forbe’s list of America’s 100 most successful small-cap companies for 2024, and was rated the third largest glass fabricator in 2023 by Glass Magazine. Headquartered in Barranquilla, Colombia, the Company operates out of a 5.6 million square foot vertically-integrated, state-of-the-art manufacturing complex that provides easy access to the Americas, the Caribbean, and the Pacific.
Biggest changeHeadquartered in Barranquilla, Colombia, the Company operates out of a 5.8 million square foot vertically-integrated, state-of-the-art manufacturing complex that provides easy access to the Americas, the Caribbean, and the Pacific. Tecnoglass supplies over 1,000 customers in North, Central and South America, with the United States accounting for 96% of revenues.
These programs increase the skills of our employees and are designed to allow our employees to keep pace with the new technologies being installed at our manufacturing facilities. We are committed to developing our employees and remaining at the forefront of technology in our industry.
These programs increase the skills of our employees and are designed to allow our employees to keep pace with the new technologies being installed at our manufacturing facilities. We are committed to developing our employees and remaining at the forefront of technology in our industry.
Demand for high-specification architectural glass is typically highest in large coastal cities, which we are able to ship to directly, while most of our competitors must utilize relatively expensive land transportation services to deliver finished goods to these sites. 8 Commitment to Quality and Innovation Our commitment to quality is evidenced by our significant investments in land, warehousing space, machinery and equipment.
Demand for high-specification architectural glass is typically highest in large coastal cities, which we are able to ship directly, while most of our competitors must utilize relatively expensive land transportation services to deliver finished goods to these sites. Commitment to Quality and Innovation Our commitment to quality is evidenced by our significant investments in land, warehousing space, machinery and equipment.
This joint venture has solidified our vertical integration strategy by providing us with an interest in the first stage of our production chain, while securing ample glass supply for our expected production needs. This business model also allows us to maintain strict quality control, from the sourcing of input materials to the installation of our finished products.
This joint venture has solidified our vertical integration strategy by providing us with an interest in the first stage of our production chain, while securing ample glass supply for our expected production needs. 7 This business model also allows us to maintain strict quality control, from the sourcing of input materials to the installation of our finished products.
We are actively expanding our sales presence in these costal markets and have already successfully completed several projects in large U.S. markets such as New York, Boston, Washington D.C. and Baltimore as well as cities along the U.S. Gulf Coast, such as Houston. 10 We intend to continue growing the business organically outside of Florida.
We are actively expanding our sales presence in these costal markets and have already successfully completed several projects in large U.S. markets such as New York, Boston, Washington D.C. and Baltimore as well as cities along the U.S. Gulf Coast, such as Houston. We intend to continue growing the business organically outside of Florida.
In addition to glass, we manufacture aluminum and vinyl products such as profiles, rods, bars, plates, and other hardware specifically designed for window manufacturing. Our products are manufactured in a 5.6 million square foot, state-of-the-art manufacturing complex in Barranquilla, Colombia that provides easy access to North, Central and South America, the Caribbean and the Pacific.
In addition to glass, we manufacture aluminum and vinyl products such as profiles, rods, bars, plates, and other hardware specifically designed for window manufacturing. Our products are manufactured in a 5.8 million square foot, state-of-the-art manufacturing complex in Barranquilla, Colombia that provides easy access to North, Central and South America, the Caribbean and the Pacific.
This investment has allowed us to reduce energy costs, while also having a positive tax effect due to our ability to deduct the investment from our taxable income in compliance with applicable Colombian tax regulations. To date, more than 20,000 solar panels have been installed on the roofs of Colombian manufacturing plants to generate reliable and clean energy.
This investment has allowed us to reduce energy costs, while also having a positive tax effect due to our ability to deduct the investment from our taxable income in compliance with applicable Colombian tax regulations. To date, more than 15,000 solar panels have been installed on the roofs of Colombian manufacturing plants to generate reliable and clean energy.
In recent years, we have successfully grown our geographic presence in the United States outside of Florida, particularly into markets along the east coast, and as a result, nearly 23% of our U.S. backlog is for projects outside of Florida.
In recent years, we have successfully grown our geographic presence in the United States outside of Florida, particularly into markets along the east coast, and as a result, nearly 16% of our U.S. backlog is for projects outside of Florida.
Occupational Health and Safety management System ● Exporter Authorized Economic Operator (AEO). ● NTC 1578:2011: Product seal for safety glass used in construction, approved by ICONTEC. ● NTC 2409:1994: Product seal for extruded aluminum alloy profiles, approved by ICONTEC. ● ANSI Z97.1-2015, CPSC 16 CFR 1201, CAN/CGSB 12.1-2017: Laminated and tempered safety glass, approved by Safety Glazing Certification Council “SGCC”. ● ASTM E2190: Insulating glass meeting all guidelines and requirements for IGCC® / IGMA® certification approved by the Insulating Glass Certification Council and the Insulating Glass Manufactures Alliance “IGCC”. ● Vitro Certified International Manufacturer Trademark license granted by Vitro for pre-selected projects and to produce certain MSVD coated products at the Solartec plant. ● Good handling of SentryGlas, Butacite and Trosifol products awarded by Kuraray for compliance with all requirements. ● Member of ACOLVISE (Colombia Association of Safety Glass Transformers) ● Member of Aluminium Extruder Xouncil (AEC) ES certifications include: ● ISO 9001:2008 Certificate of Quality Assurance ● ISO 14001:2004 Certificate of Environmental Management ● ISO 45001:2008.
Occupational Health and Safety management System ● Exporter Authorized Economic Operator (AEO). ● NTC 1578:2011: Product seal for safety glass used in construction, approved by ICONTEC. ● NTC 2409:1994: Product seal for extruded aluminum alloy profiles, approved by ICONTEC. ● ANSI Z97.1-2015, CPSC 16 CFR 1201, CAN/CGSB 12.1-2017: Laminated and tempered safety glass, approved by Safety Glazing Certification Council “SGCC”. ● ASTM E2190: Insulating glass meeting all guidelines and requirements for IGCC® / IGMA® certification approved by the Insulating Glass Certification Council and the Insulating Glass Manufactures Alliance “IGCC”. ● Vitro Certified International Manufacturer Trademark license granted by Vitro for pre-selected projects and to produce certain MSVD coated products at the Solartec plant. ● Good handling of SentryGlas, Butacite and Trosifol products awarded by Kuraray for compliance with all requirements. ● Member of ACOLVISE (Colombia Association of Safety Glass Transformers) ES certifications include: ● ISO 9001:2015 Certificate of Quality Assurance ● ISO 14001:2015 Certificate of Environmental Management ● ISO 45001:2018.
We improved efficiency in our glass production during 2022 and 2023 by further automating certain key manufacturing processes to increase capacity, while reducing material waste and overall lead times.
We improved efficiency in our glass production during 2023 and 2024 by further automating certain key manufacturing processes to increase capacity, while reducing material waste and overall lead times.
The cost associated with product warranties was $1.9 million and $2.4 million during the years ended December 31, 2023 and 2022, respectively. Certifications Among our many designations and certifications, Tecnoglass has earned the Miami-Dade County Notice of Acceptance (“NOA”), one of the most demanding certificates in the industry and a requirement to market hurricane-resistant glass in Florida.
The cost associated with product warranties was $2.6 million and $1.9 million during the years ended December 31, 2024 and 2023, respectively. Certifications Among our many designations and certifications, Tecnoglass has earned the Miami-Dade County Notice of Acceptance (“NOA”), one of the most demanding certificates in the industry and a requirement to market hurricane-resistant glass in Florida.
These investments have also contributed to workplace safety, with our Lost Time Injury Frequency Rate (LTIFR), which measures the number of lost-time injuries per million hours worked during the financial year, of 3.1% which is substantially lower than the average for manufacturing companies in Colombia which stood at approximately 7.9% for 2023.
These investments have also contributed to workplace safety, with our Lost Time Injury Frequency Rate (LTIFR), which measures the number of lost-time injuries per million hours worked during the financial year, of 2.3% which is substantially lower than the average for manufacturing companies in Colombia which stood at approximately 9.1% for 2024.
We intend to capitalize on our existing distribution base for our aluminum products to obtain significant synergies given the significant number of dealers and distributors that already sell both aluminum and vinyl windows. Additionally, we expect to benefit from a wider product offering in markets where vinyl made frames and windows are more prevalent than aluminum ones. Penetrate the U.S.
We intend to capitalize on our existing distribution base for our aluminum products to obtain significant synergies given the significant number of dealers and distributors that already sell both aluminum and vinyl windows. Additionally, we expect to benefit from a wider product offering in markets where vinyl frames and windows are more prevalent than aluminum ones.
These investments have also helped us manage workplace injuries, with a Lost Time Injury Frequency Rate of 3.1%, which is considerably lower than the average rate of approximately 7.9% for glass and metal manufacturing companies in Colombia for 2023. We have remained union-free since ES’s incorporation in 1983.
These investments have also helped us manage workplace injuries, with a Lost Time Injury Frequency Rate of 2.3%, which is considerably lower than the average rate of approximately 9.1% for glass and metal manufacturing companies in Colombia for 2024. We have remained union-free since ES’s incorporation in 1983.
In 2023, our scholarship program allowed over 551 students to pursue higher education at Colombian universities. We support local educational entities and organizations pursuing societal change and community enhancement. Our multiple programs also include collaboration with partners to promote sports and encourage healthy lifestyles among the youth.
In 2024, our scholarship program allowed over 530 students to pursue higher education at Colombian universities. We support local educational entities and organizations pursuing societal change and community enhancement. Our multiple programs also include collaboration with partners to promote sports and encourage healthy lifestyles among the youth.
The Company considers itself an equal opportunity employer and has constantly sought to seek the best talent irrespective of gender or ethnicity. While the jobs associated to the core manufacturing operations are predominantly filled by males, our sales and administrative staff is comprised of approximately 33% females and 67% males.
The Company considers itself an equal opportunity employer and has constantly sought to seek the best talent irrespective of gender or ethnicity. While the jobs associated to the core manufacturing operations are predominantly filled by males, our sales and administrative staff is comprised of approximately 32% females and 68% males.
Of our 100 largest customers, which represent over 80% of our sales during the twelve months ended December 31, 2023, approximately 98% are located in North America and 2% in Latin America. No single customer accounted for more than 10% of our revenues during the years ended December 31, 2023 and 2022.
Of our 100 largest customers, which represent over 72% of our sales during the twelve months ended December 31, 2024, approximately 98% are located in North America and 2% in Latin America. No single customer accounted for more than 10% of our revenues during the years ended December 31, 2024, and 2023.
During 2023, we delivered more than 110 housing improvements. These and other initiatives have allowed us to maintain a strong relationship with the communities and our employees. We continuously strive to make a difference for our people, contributing to building a better future for the region and our country.
During 2024, we delivered more than 107 housing improvements. These and other initiatives have allowed us to maintain a strong relationship with the communities and our employees. We continuously strive to make a difference for our people, contributing to building a better future for the region and our country.
In line with the geographic penetration strategy, we have started expanding our presence to other markets by opening product showrooms in other states. As of the date of this Annual Report, showrooms in New York City and Charleston, SC have been opened to service its respective regions.
In line with the geographic penetration strategy, we have started expanding our presence to other markets by opening product showrooms in other states. As of the date of this Annual Report, showrooms in New York City, Charleston, SC, Houston, TX, and Bonita Springs, FL, have been opened to service its respective regions.
The Company incurs costs related to the development of new products and pays for external tests that need to be performed on our products in order to comply with strict building codes. Human Capital As of December 31, 2023, we had a total of 8,531 employees, none of whom is represented by a union.
The Company incurs costs related to the development of new products and pays for external tests that need to be performed on our products in order to comply with strict building codes. Human Capital As of December 31, 2024, we had a total of 9,837 employees, none of whom is represented by a union.
Although our business and facilities are subject to federal, state and local environmental regulation, environmental regulation does not have a material impact on our operations. 15 Research and Development During the years ended December 31, 2023, 2022 and 2021, we spent approximately $0.9 million, $0.6 million, and $0.7 million, respectively, in research and development.
Although our business and facilities are subject to federal, state and local environmental regulation, environmental regulation does not have a material impact on our operations. Research and Development During the years ended December 31, 2024, 2023 and 2022, we spent approximately $2.1 million, $0.9 million, and $0.6 million, respectively, in research and development.
By vertically integrating each of these functions, we are able to eliminate inefficiencies throughout the supply chain and generate strong margins. These efficiencies are only enhanced as our business grows and we benefit from operating leverage and economies of scale. On May 3, 2019, we consummated a joint venture agreement with Compagnie de Saint-Gobain S.A.
By vertically integrating each of these functions, we are able to eliminate inefficiencies throughout the supply chain and generate strong margins. These efficiencies are only enhanced as our business grows and we benefit from operating leverage and economies of scale. In 2019 we entered into a joint venture agreement with Compagnie de Saint-Gobain S.A.
Recent examples of our high return investments within the last two years include: ● Automation of six window assembly production lines, increasing efficiencies, labor and material waste costs with an estimated reduction of on-site damage by 30%; ● Additional aluminum expansion project to increase capacity by approximately 400 tons/month; ● Further automation of additional glass lines, increasing efficiencies on an end-to-end basis reducing lead times, headcount and on-site damage by approximately 40%; ● Upgrading vacuum magnetron sputter coating machinery which will allow us to coat glass before tempering; ● Automation of two centralized aluminum warehouses for storing, sorting and delivering extrusion matrices and aluminum profiles to our internal production processes that reduce lead times for the assembly of architectural systems and reduce on-site damage to materials; ● Acquiring 1.5 million square feet of land adjacent to our existing facilities for future expansion and for our sport facility complex available to factory employees; and ● Establishing new vinyl window assembly lines with annualized capacity of approximately $300 million.
Recent examples of our high return investments within the last three years include: ● Further automation of window assembly production lines, increasing efficiencies, labor and material waste costs with an estimated reduction of on-site damage by 30%; ● Additional aluminum expansion project to increase capacity by approximately 400 tons/month; ● Further automation of additional glass lines, increasing efficiencies on an end-to-end basis reducing lead times, headcount and on-site damage by approximately 40%; ● Upgrading vacuum magnetron sputter coating machinery which will allow us to coat glass before tempering; ● Automation of two centralized aluminum warehouses for storing, sorting and delivering extrusion matrices and aluminum profiles to our internal production processes that reduce lead times for the assembly of architectural systems and reduce on-site damage to materials; ● Acquiring 1.5 million square feet of land adjacent to our existing facilities for future expansion and for our sport facility complex available to factory employees; ● Establishing new vinyl window assembly lines with annualized capacity of approximately $300 million; and ● Entering the second phase of expanding our architectural metal facade plant, which specializes in engineering, designing, and manufacturing tailor-made facades.
Since 2012, we have invested more than $500 million in the latest technologies to enhance the efficiency and accuracy of our production lines, and ultimately to improve the quality of the products that we deliver to our customers. We believe these significant investments position us to meet our growth objectives over the next several years.
Since 2022, we have invested nearly $260 million in the latest technologies to enhance the efficiency and accuracy of our production lines, and ultimately to improve the quality of the products that we deliver to our customers. We believe these significant investments position us to meet our growth objectives over the next several years.
We had a significant demand in the U.S. residential market, representing 40.3% of our total sales for the year ended December 31, 2023, compared to less than 5% for the year ended December 31, 2017, and 42.8% for the year ended December 31, 2022.
We had a significant demand in the U.S. residential market, representing 41.9% of our total sales for the year ended December 31, 2024, compared to less than 5% for the year ended December 31, 2017, and 40.3% for the year ended December 31, 2023.
With a focus on innovation, combined with providing highly specified products with the highest quality standards at competitive prices, we have developed a leadership position in each of our core markets. In the United States, which is our largest market, we were ranked as the third largest glass fabricator serving the United States in 2023 by Glass Magazine.
With a focus on innovation, combined with providing highly specified products with the highest quality standards at competitive prices, we have developed a leadership position in each of our core markets. In the United States, which is our largest market, we were ranked among the four largest glass fabricators serving the United States in 2024 by Glass Magazine.
Since 2017, we have been expanding our presence in U.S. residential markets which went from less than 5% of our sales to nearly 40.3% of our sales for the full year 2023.
Since 2017, we have been expanding our presence in U.S. residential markets which went from less than 5% of our sales to nearly 41.9% of our sales for the full year 2024.
The committed line of credit of $150 million was fully unused as of December 31, 2023. 13 Customers Our customers include architects, building owners, general contractors and glazing contractors in the commercial construction market. We currently have approximately 1,000 customers.
The committed line of credit of $150 million was mostly unused as of December 31, 2024. 13 Customers Our customers include architects, building owners, general contractors and glazing contractors in the commercial construction market. We currently have approximately 1000 customers.
The U.S. private residential construction market exceeded $900 billion in spending during the twelve months ended December 31, 2023, according to the United States Census Bureau. Residential housing starts in the U.S. increased by 7.6% during December 2023 compared to December 2022, according to the U.S. Census Bureau.
The U.S. private residential construction market exceeded $950 billion in spending during the twelve months ended December 31, 2024, according to the United States Census Bureau. Single Family Residential housing starts in the U.S. increased by 6.5% during December 2024 compared to December 2023, according to the U.S. Census Bureau.
Warranties We offer product warranties, which we believe are competitive for the markets in which our products are sold. The nature and extent of these warranties depend upon the product. Our standard warranties are generally from five to ten years for architectural glass, curtain wall, laminated and tempered glass, window and door products.
The nature and extent of these warranties depend upon the product. Our standard warranties are generally from five to ten years for architectural glass, curtain wall, laminated and tempered glass, window and door products.
Our products have become widely regarded in Florida for their quality and are certified in compliance with all U.S. regulations. Sales in Florida comprised 90% of United States revenue in the year ended December 31, 2023.
Our products have become widely regarded in Florida for their quality and are certified in compliance with all U.S. regulations. Given advantageous secular and demographic trends, sales in Florida comprised 89% of United States revenue in the year ended December 31, 2024.
During the year ended December 31, 2023, two suppliers accounted for more than 10% of total raw material purchases, and in aggregate both account for 22.1% of total raw material purchases. During the year ended December 31, 2022, one supplier accounted for more than 10% of total raw material purchases.
During the year ended December 31, 2024, two suppliers accounted for more than 10% of total raw material purchases, and in aggregate both account for 25.1% of total raw material purchases.
Working Capital Requirements and Debt Facilities During the year ended December 31, 2023, we generated $138.8 million of cash from operating activities.
Working Capital Requirements and Debt Facilities During the year ended December 31, 2024, we generated $170.5 million of cash from operating activities.
TG certifications include: ● ISO 9001:2008 Certificate of Quality Assurance ● ISO 14001:2004 Certificate of Environmental Management ● ISO 45001:2008.
TG certifications include: ● ISO 9001:2015 Certificate of Quality Assurance ● ISO 14001:2015 Certificate of Environmental Management ● ISO 45001:2018.
With over 40 years of experience in architectural glass and aluminum assembly, we specialize in transforming various glass products. Our offerings include tempered safety glass, double thermo-acoustic glass, and laminated glass. Our wide range of finished glass products are utilized in diverse buildings for floating facades, curtain walls, windows, doors, handrails, as well as interior and bathroom spatial dividers.
Our offerings include tempered safety glass, double thermo-acoustic glass, and laminated glass. Our wide range of finished glass products are utilized in diverse buildings for floating facades, curtain walls, windows, doors, handrails, as well as interior and bathroom spatial dividers.
From there, our products can be shipped to Miami in three days and New York in one week. In addition, for short lead-time projects, our products can be transported by air from Barranquilla to Houston or Miami within a few hours.
In addition, for short lead-time projects, our products can be transported by air from Barranquilla to Houston or Miami within a few hours.
Customer Service We believe that our ability to provide customers outstanding service is a strong competitive differentiator. Our customer relationships are established and maintained through the coordinated efforts of our sales and production teams. We employ a highly responsive and efficient team of professionals devoted to addressing customer support with the goal of resolving any issue in a timely manner.
Customer Service We believe that our ability to provide customers with outstanding service is a strong competitive differentiator. Our customer relationships are established and maintained through the coordinated efforts of our sales and production teams.
Brands and Trademarks Our main brands are Tecnoglass, ESWindows and Alutions. Our registered trademarks include El Poder de la Calidad, Energia Solar, Tecnoglass, Alutions, Eswindows, Tecnobend, Tecnoair, Tecnosmart, ECOMAX by ESWINDOWS, ESWINDOWS Interiors, ESW Windows and Walls, Solartec by Tecnoglass, Prestige by ESWINDOWS, Eli by ESWINDOWS, Alessia by ESWINDOWS, Elite Line by ESWindows, ULTRAVIEW by Tecnoglass, and MULTIMAX by ESWIDOWS.
Our registered trademarks include The Power of Quality, Energia Solar, ES, ES Imagine Extraordinary, Tecnoglass, Alutions, Eswindows, Tecnobend, Tecnoair, Tecnosmart, ECOMAX by ESWINDOWS, ESWINDOWS Interiors, ESW Windows and Walls, Solartec by Tecnoglass, Prestige by ESWINDOWS, Eli by ESWINDOWS, Alessia by ESWINDOWS, Elite Line by ESWindows, ULTRAVIEW by Tecnoglass, and MULTIMAX by ESWIDOWS.
We operate state-of-the-art glass making equipment, glass laminating lines, aluminum presses, vinyl assembling lines, and high-volume insulating equipment which facilitate more precise manufacturing, enabling us to offer a broader selection of and higher quality products and remain agile in responding to customer demands, while generating less raw material waste.
We operate state-of-the-art glass making equipment, glass laminating lines, aluminum presses, vinyl assembling lines, and high-volume insulating equipment which facilitate more precise manufacturing, enabling us to offer a broader selection of and higher quality products and remain agile in responding to customer demands, while generating less raw material waste. 8 We believe our investments in technology have positioned us well for continued growth in the years ahead given the flexibility afforded by our current installed capacity, improved profitability, and enhanced cash generation.
The principal methods of competition in the window and door industry are the development of long-term relationships with window and door distributors and dealers, and the retention of customers by delivering a full range of high-quality customized products on demand with short turnaround times while offering competitive pricing.
We face intense competition from both smaller and larger market players who compete against us in our various markets including glass, window and aluminum manufacturing. 15 The principal methods of competition in the window and door industry are the development of long-term relationships with window and door distributors and dealers, and the retention of customers by delivering a full range of high-quality customized products on demand with short turnaround times while offering competitive pricing.
Our products can be found on some of the most distinctive buildings in these regions, including 100 Hood Park Drive (Boston), 601 West 29 th St (New York). Norwegian Cruise Line Terminal B (Miami), Paramount Miami Worldcenter (Miami), Via 57 West (New York), One65 Main (Cambridge), AE’O Tower (Honolulu), Salesforce Tower (San Francisco), and One Thousand Museum (Miami).
Our products can be found on some of the most distinctive buildings in these regions, including the Aston Martin Residences (Miami), Miami World Tower (Miami), 3ELEVEN (New York), Raffles Hotel (Boston), Norwegian Cruise Line Terminal B (Miami), One Thousand Museum (Miami), Paramount Miami Worldcenter (Miami), Salesforce Tower (San Francisco) and AE’O Tower (Honolulu).
The market in the United States in which we compete is mainly comprised of manufacturers, distributors and installers of glass curtain walls, windows and doors for commercial and residential buildings.
Competitors We have local and international competitors that also focus on glass and aluminum transformation, window ensemble and installation and designing in the commercial and residential construction markets. The market in the United States in which we compete is mainly comprised of manufacturers, distributors and installers of glass curtain walls, windows and doors for commercial and residential buildings.
Our vertical integration allowed us to successfully navigate the global supply chain constraints of 2020 and 2021 which severely impacted many sectors of the global economy, including shortages in supply of materials, slowdown of logistic operations and cost inflation. 7 Cost of Production Advantages We enjoy significant cost advantages because of our location in Colombia that we would not be able to realize if our production facility was located in the United States.
Our vertical integration allowed us to successfully navigate the global supply chain constraints of 2020 and 2021 which severely impacted many sectors of the global economy, including shortages in supply of materials, slowdown of logistic operations and cost inflation.
Norwegian Cruise Line Terminal B (Miami), Paramount Miami Worldcenter (Miami), Via 57 West (New York), One65 Main (Cambridge), AE’O Tower (Honolulu), Salesforce Tower (San Francisco), and One Thousand Museum (Miami). 5 Our Business General We are experienced and highly skilled in the vertical integration of architectural glass manufacturing, distribution, and professional fitting.
Tecnoglass’s tailored, high-end products are found on some of the world’s most distinctive properties, including the Aston Martin Residences (Miami), Miami World Tower (Miami), 3ELEVEN (New York), Raffles Hotel (Boston), Norwegian Cruise Line Terminal B (Miami), One Thousand Museum (Miami), Paramount Miami Worldcenter (Miami), Salesforce Tower (San Francisco) and AE’O Tower (Honolulu). 5 Our Business General We are experienced and highly skilled in the vertical integration of architectural glass manufacturing, distribution, and professional fitting.
As of December 31, 2022, we had a total of 8,770 employees. Most of our employees are hired through seven temporary staffing companies and are employed under one-year fixed-term employment contracts. We actively encourage and facilitate the development of our employees through rolling training programs, with multiple training sessions held on a weekly basis.
As of December 31, 2023, we had a total of 8,531 employees. We actively encourage and facilitate the development of our employees through rolling training programs, with multiple training sessions held on a weekly basis.
As we explore growth opportunities in new U.S. markets, we intend to leverage the strong reputation we have developed with national commercial construction contractors, architects, and designers for providing high quality products at the most competitive prices.
As we explore growth opportunities in new U.S. markets, we intend to leverage the strong reputation we have developed with national commercial construction contractors, architects, and designers for providing high quality products at the most competitive prices. 10 In late 2023, we entered into the vinyl window market, expanding our product portfolio to more than double our addressable market, and offering customers a wider selection of solutions to meet their project needs.
Additionally, showrooms in Houston, TX, and Bonita Springs, FL have been completed and are expected to be fully operational in early 2024. Continued Investment in Technology to Meet Evolving Demands We have a track record of developing innovative new products, and we intend to continue our focus on new product opportunities in the future.
Additionally, showrooms in Phoenix, AZ and Los Angeles, CA are in the lease negotiating stages and we expect such showrooms to open in 2025. Continued Investment in Technology to Meet Evolving Demands We have a track record of developing innovative new products, and we intend to continue our focus on new product opportunities in the future.
In 2022, we invested in additional automation and capacity expansion which was fully operational by the second half of 2023. In addition, during 2023, we made investments in our newly installed vinyl assembling lines to manufacture and distribute cutting-edge vinyl windows for new and existing customers starting in November 2023.
In addition, during 2023, we made investments in our newly installed vinyl assembling lines to manufacture and distribute cutting-edge vinyl windows for new and existing customers starting in November 2023. During 2024 we completed the second phase of expanding our architectural metal facade plant, which specializes in engineering, designing, and manufacturing tailor-made façade.
The term loan had a balance of $172.5 million as of December 31, 2023 (with an additional $15 million paid down in January 2024), matures in late 2026 and bears interest at SOFR plus a spread of 1.5%.
Our debt is comprised primarily of a Senior Secured Credit Facility which consists of a term loan and a Committed line of Credit. The term loan had a balance of $110 million as of December 31, 2024, matures in late 2026 and bears interest at SOFR plus a spread of 1.5%.
Low-Cost Distribution Our principal manufacturing facility is located in Barranquilla, Colombia, which is strategically located near three of the country’s major ports: Barranquilla, Cartagena and Santa Marta. These ports provide us with maritime access to all major global markets. The Barranquilla port is just 16 kilometers away from our production facility.
These ports provide us with maritime access to all major global markets. The Barranquilla port is just 16 kilometers away from our production facility. From there, our products can be shipped to Miami in three days and New York in one week.
While enhancing production cost efficiencies, along with ESG initiatives, we entered into a long-term power purchase agreement in a new project that will cogenerate 9MW through two gas engines with a heat recovery system.
While enhancing production cost efficiencies, along with ESG initiatives, we entered into a long-term power purchase agreement to cogenerate 9MW through two gas engines with a heat recovery system. Low-Cost Distribution Our principal manufacturing facility is located in Barranquilla, Colombia, which is strategically located near three of the country’s major ports: Barranquilla, Cartagena and Santa Marta.
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Tecnoglass supplies over 1,000 customers in North, Central and South America, with the United States accounting for 95% of revenues. Tecnoglass’s tailored, high-end products are found on some of the world’s most distinctive properties, including 100 Hood Park Drive (Boston), 601 West 29 th St (New York).
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Tecnoglass earned the #1 spot on Forbe’s list of America’s 100 most successful small-cap companies for 2024, and was ranked among the four largest glass fabricators in 2024 by Glass Magazine.
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The purchase price for our interest in Vidrio Andino was $45 million, of which $34.1 million was paid in cash and $10.9 million was paid through the contribution of land on December 9, 2020.
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We were ranked by Fortune Magazine as the 27th fastest-growing company in the United States for 2024, based on Tecnoglass’ strong revenue growth, earnings per share growth, and three-year annualized return to shareholders for the period ended June 30, 2024. With over 40 years of experience in architectural glass and aluminum assembly, we specialize in transforming various glass products.
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On October 28, 2020, we acquired said land from a related party in exchange for an aggregate of 1,557,142 ordinary shares of the Company, valued at $7.00 per share, which represented an approximate 33% premium based on the closing stock price as of October 27, 2020.
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The joint venture agreement includes plans to build a new plant that will be located approximately 20 miles from our primary manufacturing facility in Barranquilla Colombia, in which we will also have a 25.8% interest.
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We believe our investments in technology have positioned us well for continued growth in the years ahead given the flexibility afforded by our current installed capacity, improved profitability, and enhanced cash generation.
Added
The new plant will be funded with proceeds from the original cash contribution made by us, operating cash flows from the Bogota plant, debt incurred at the joint venture level that will not be consolidated into our company.
Removed
In late 2023, we entered into the vinyl window market, expanding our product portfolio to more than double our addressable market, and offering customers a wider selection of solutions to meet their project needs.
Added
Cost of Production Advantages We enjoy significant cost advantages because of our location in Colombia that we would not be able to realize if our production facility was located in the United States.
Removed
In 2020, we completed the automation of our first two centralized aluminum warehouses for storing, sorting and delivering aluminum profiles to our internal production processes that reduce lead times for the assembly of architectural systems and reduce on-site damage to materials which had a positive impact to our working capital through more effective inventory management.
Added
We started deliveries of vinyl products in 2024 and gradually continued to grow our order flow through year end, a trend that we expect to continue as we move forward with the onboarding of new clients in different geographies. Penetrate the U.S.
Removed
Our debt is comprised primarily of a Senior Secured Credit Facility which consists of a term loan and a Committed line of Credit.
Added
In 2022, we invested in additional automation of our internal production processes that reduce lead times for the assembly of architectural systems and capacity expansion which was fully operational by the second half of 2023.
Removed
Importer of Customs Trade Partnership Against Terrorism (CTPAT) Tier 3 Category. Competitors We have local and international competitors that also focus on glass and aluminum transformation, window ensemble and installation and designing in the commercial and residential construction markets.
Added
Brands and Trademarks Our main brands are Tecnoglass, ESWindows and Alutions.
Removed
We face intense competition from both smaller and larger market players who compete against us in our various markets including glass, window and aluminum manufacturing.
Added
We employ a highly responsive and efficient team of professionals devoted to addressing customer support with the goal of resolving any issue in a timely manner.
Added
During the year ended December 31, 2023, two suppliers accounted for more than 10% of total raw material purchases, and in aggregate both account for 22.1% of total raw material purchases. Warranties We offer product warranties, which we believe are competitive for the markets in which our products are sold.
Added
Importer of Customs Trade Partnership Against Terrorism (CTPAT) Tier 3 Category. ES Metals certification: ISO 9001:2015 Certificate of Quality Assurance Tecnoglass Inc: Verification of the Greenhouse Gas Inventory in Compliance with the GHG Protocol and the ISO 14064-3 Standard, certified by ICONTEC.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

53 edited+15 added−26 removed212 unchanged
Biggest changeRecent armed conflicts around the globe, including sanctions and tensions between United States, NATO allies and several eastern countries, may adversely affect the results of our operations. The Russian invasion of Ukraine starting in February 2022 has escalated global tensions between the United States and NATO countries against Russia. Colombia has also condemned Russia’s invasion of Ukraine.
Biggest changeThe Russian invasion of Ukraine starting in February 2022 escalated global tensions between the United States and NATO countries against Russia. Colombia has also condemned Russia’s invasion of Ukraine. Multiple economic sanctions against Russia were imposed by many countries worldwide which has impacted the global economy as many commercial, industrial and financial businesses closed operations in Russia.
The events could have a materially adverse impact on our results of operations. Given the uncertainties inherent with product development and introduction, including lack of market acceptance, we cannot provide assurance that any of our product development efforts will be successful on a timely basis or within budget, if at all.
The events could have a materially adverse impact on our results of operations. 20 Given the uncertainties inherent with product development and introduction, including lack of market acceptance, we cannot provide assurance that any of our product development efforts will be successful on a timely basis or within budget, if at all.
In addition, the effect on consumer confidence of any actual or perceived deterioration of household incomes in the Colombian economy may have a material adverse effect on our results of operations and financial condition. We are dependent on sales to customers outside Colombia and any failure to make these sales may adversely affect our operating results in the future.
In addition, the effect on consumer confidence of any actual or perceived deterioration of household incomes in the Colombian economy may have a material adverse effect on our results of operations and financial condition. 29 We are dependent on sales to customers outside Colombia and any failure to make these sales may adversely affect our operating results in the future.
The president of Colombia has considerable power to determine governmental policies and actions relating to the economy and may adopt policies that are inconsistent with those of the prior government or that negatively affect us. 27 Factors such as Colombia’s growing public debt and fluctuating exchange rates could adversely affect the Colombian economy.
The president of Colombia has considerable power to determine governmental policies and actions relating to the economy and may adopt policies that are inconsistent with those of the prior government or that negatively affect us. Factors such as Colombia’s growing public debt and fluctuating exchange rates could adversely affect the Colombian economy.
Claims of this nature could also have a negative impact on customer confidence in our products and us. 22 We are subject to potential exposure to environmental liabilities and are subject to environmental regulation and any such liabilities or regulation may negatively affect our costs and results of operations in the future.
Claims of this nature could also have a negative impact on customer confidence in our products and us. We are subject to potential exposure to environmental liabilities and are subject to environmental regulation and any such liabilities or regulation may negatively affect our costs and results of operations in the future.
Please see “Disclosure Regarding Foreign Exchange Controls and Exchange Rates in Colombia” for actions the Central Bank could take to intervene in the exchange market. The Colombian Government has considerable power to shape the Colombian economy and, consequently, affect the operations and financial performance of businesses.
Please see “Disclosure Regarding Foreign Exchange Controls and Exchange Rates in Colombia” for actions the Central Bank could take to intervene in the exchange market. 28 The Colombian Government has considerable power to shape the Colombian economy and, consequently, affect the operations and financial performance of businesses.
Future governmental policies and actions, or judicial decisions, could adversely affect our results of operations or financial condition. 31 We are subject to money laundering and terrorism financing risks. Third parties may use us as a conduit for money laundering or terrorism financing.
Future governmental policies and actions, or judicial decisions, could adversely affect our results of operations or financial condition. We are subject to money laundering and terrorism financing risks. Third parties may use us as a conduit for money laundering or terrorism financing.
Our business or financial condition could be adversely affected by rapidly changing economic or social conditions, including the Colombian government’s response to implementation of the agreement with FARC and ongoing peace negotiations, if any, which may result in legislation that increases the tax burden of Colombian companies. 30 Despite efforts by the Colombian government, drug-related crime, guerrilla paramilitary activity and criminal bands continue to exist in Colombia, and allegations have surfaced regarding members of the Colombian congress and other government officials having ties to guerilla and paramilitary groups.
Our business or financial condition could be adversely affected by rapidly changing economic or social conditions, including the Colombian government’s response to implementation of the agreement with FARC and ongoing peace negotiations, if any, which may result in legislation that increases the tax burden of Colombian companies. 31 Despite efforts by the Colombian government, drug-related crime, guerrilla paramilitary activity and criminal bands continue to exist in Colombia, and allegations have surfaced regarding members of the Colombian congress and other government officials having ties to guerilla and paramilitary groups.
The new agreement was signed on November 24, 2016, and was ratified by the Colombian Congress on November 30, 2016, and is being implemented. Pursuant to the peace agreements negotiated between the FARC and the Colombian government in 2016, the FARC occupies five seats in the Colombian Senate and five seats in the Colombian House of Representatives.
The agreement was signed on November 24, 2016, and was ratified by the Colombian Congress on November 30, 2016, and is being implemented. Pursuant to the peace agreements negotiated between the FARC and the Colombian government in 2016, the FARC occupies five seats in the Colombian Senate and five seats in the Colombian House of Representatives.
High temperatures and decrease in rainfall in Colombia, attributable in part to the El Niño weather pattern, have resulted in severe droughts, affecting especially prices in Colombia, as hydropower accounts for 70% of total country’s energy.
High temperatures and decrease in rainfall in Colombia, attributable in part to the El Niño weather pattern, have resulted in severe droughts, affecting especially prices in Colombia, as hydropower accounts for approximately 70% of total country’s energy.
The above could result in cancellation or suspension of governmental registrations, authorizations and licenses issued by other authorities, any one of which may result in interruption or discontinuity of business, and could, consequently, materially and adversely affect our business, financial condition or results of operation. 20 Equipment failures, delays in deliveries and catastrophic loss at our manufacturing facility could lead to production curtailments or shutdowns that prevent us from producing our products.
The above could result in cancellation or suspension of governmental registrations, authorizations and licenses issued by other authorities, any one of which may result in interruption or discontinuity of business, and could, consequently, materially and adversely affect our business, financial condition or results of operation. 21 Equipment failures, delays in deliveries and catastrophic loss at our manufacturing facility could lead to production curtailments or shutdowns that prevent us from producing our products.
Although we do not have any disputes with any major customers as of the date hereof that are expected to have a material adverse effect on our financial position, results of operations or cash flows, we cannot predict whether such disputes will arise in the future. 21 Our results may not match our provided guidance or the expectations of securities analysts or investors, which likely would have an adverse effect on the market price of our securities.
Although we do not have any disputes with any major customers as of the date hereof that are expected to have a material adverse effect on our financial position, results of operations or cash flows, we cannot predict whether such disputes will arise in the future. 22 Our results may not match our provided guidance or the expectations of securities analysts or investors, which likely would have an adverse effect on the market price of our securities.
However, the payment of dividends in the future, if any, will be contingent upon our revenues and earnings, if any, capital requirements and our general financial condition and limitations imposed by our outstanding indebtedness. 34 If securities analysts do not publish research or reports about our business or if they downgrade our stock or our sector, our stock price and trading volume could decline.
However, the payment of dividends in the future, if any, will be contingent upon our revenues and earnings, if any, capital requirements and our general financial condition and limitations imposed by our outstanding indebtedness. 35 If securities analysts do not publish research or reports about our business or if they downgrade our stock or our sector, our stock price and trading volume could decline.
The activity level during the second quarter varies greatly with variations in temperature and precipitation. 23 Our results of operations could be significantly affected by foreign currency fluctuations and currency regulations. We are subject to risks relating to fluctuations in currency exchange rates that may affect our sales, cost of sales, operating margins and cash flows.
The activity level during the second quarter varies greatly with variations in temperature and precipitation. 24 Our results of operations could be significantly affected by foreign currency fluctuations and currency regulations. We are subject to risks relating to fluctuations in currency exchange rates that may affect our sales, cost of sales, operating margins and cash flows.
Even though the country has taken measures to stabilize the economy, it is uncertain how will these measures be perceived and if the intended goal of increasing investor’s confidence will be achieved. 26 Economic and political conditions in Colombia may have an adverse effect on our financial condition and results of operations.
Even though the country has taken measures to stabilize the economy, it is uncertain how will these measures be perceived and if the intended goal of increasing investor’s confidence will be achieved. 27 Economic and political conditions in Colombia may have an adverse effect on our financial condition and results of operations.
A United States investor should consult its advisors regarding the potential application of these rules to an investment in the ordinary shares. 35 We may be adversely affected by any disruption in our information technology systems. Our operations are dependent upon our information technology systems, which encompass all of our major business functions.
A United States investor should consult its advisors regarding the potential application of these rules to an investment in the ordinary shares. 36 We may be adversely affected by any disruption in our information technology systems. Our operations are dependent upon our information technology systems, which encompass all of our major business functions.
Any future downturn or any other negative market pressures could negatively affect our results of operations in the future, as margins may decrease as a direct result of an overall decrease in demand for our products. 25 Our indebtedness could adversely affect our financial health and prevent us from fulfilling our obligations.
Any future downturn or any other negative market pressures could negatively affect our results of operations in the future, as margins may decrease as a direct result of an overall decrease in demand for our products. 26 Our indebtedness could adversely affect our financial health and prevent us from fulfilling our obligations.
Recently, a coalition of U.S. producers of aluminum extrusions filed a petition with U.S. trade authorities requesting the imposition of anti-dumping duties against imports of aluminum extrusions from Colombia. As we are the main extruder of aluminum in Colombia, we volunteered as a mandatory respondent in the investigation and provided certain requested information.
In 2024 a coalition of U.S. producers of aluminum extrusions filed a petition with U.S. trade authorities requesting the imposition of anti-dumping duties against imports of aluminum extrusions from Colombia. As we are the main extruder of aluminum in Colombia, we volunteered as a mandatory respondent in the investigation and provided certain requested information.
In the year ended December 31, 2023, 97% of our sales were to customers outside Colombia, including to the United States and Panama, and we expect sales into the United States and other foreign markets to continue to represent a significant portion of our net sales.
In the year ended December 31, 2024, 97% of our sales were to customers outside Colombia, including to the United States and Panama, and we expect sales into the United States and other foreign markets to continue to represent a significant portion of our net sales.
We may not be able to predict how changing market conditions in Colombia will affect our financial results. During 2023, Moody’s, S&P and Fitch, three of the main rating agencies worldwide, ratings for Colombia stood at “Baa2”, “BB+”, and “BB+” respectively, where Moody’s and Fitch had a Stable outlook and S&P reported a negative outlook.
We may not be able to predict how changing market conditions in Colombia will affect our financial results. During 2024, Moody’s, S&P and Fitch, three of the main rating agencies worldwide, ratings for Colombia maintained at “Baa2”, “BB+”, and “BB+” respectively, where Moody’s and Fitch had a Stable outlook and S&P reported a negative outlook.
The new deal clarifies protection to private property, is expected to increase the government’s presence in rural areas and bans former rebels from running for office in certain newly created congressional districts in post-conflict zones.
The agreement clarifies protection to private property, is expected to increase the government’s presence in rural areas and bans former rebels from running for office in certain newly created congressional districts in post-conflict zones.
The interests of our controlling shareholders could differ from the interests of our other shareholders. Energy Holding Corporation exercises significant influence over us as a result of its majority shareholder position and voting rights. As of the date of this Form 10-K, Energy Holding Corporation beneficially owned approximately 52.4% of our outstanding ordinary shares.
The interests of our controlling shareholders could differ from the interests of our other shareholders. Energy Holding Corporation exercises significant influence over us as a result of its majority shareholder position and voting rights. As of the date of this Form 10-K, Energy Holding Corporation beneficially owned approximately 48.9% of our outstanding ordinary shares.
We source raw materials and glass necessary to manufacture our products from a variety of domestic and foreign suppliers. During the year ended December 31, 2023, two suppliers accounted for more than 10% of total raw material purchases, and in aggregate both account for 22.1% of total raw material purchases.
We source raw materials and glass necessary to manufacture our products from a variety of domestic and foreign suppliers. During the year ended December 31, 2024, two suppliers accounted for more than 10% of total raw material purchases, and in aggregate both account for 25.1% of total raw material purchases.
Customer concentration and related credit, commercial and legal risk may adversely impact our future earnings and cash flows. Our ten largest third-party customers worldwide collectively accounted for 34% of our total sales revenue for the year ended December 31, 2023, though no single customer accounted for more than 10% of annual revenues.
Customer concentration and related credit, commercial and legal risk may adversely impact our future earnings and cash flows. Our ten largest third-party customers worldwide collectively accounted for 27.8% of our total sales revenue for the year ended December 31, 2024, though no single customer accounted for more than 10% of annual revenues.
During the year ended December 31, 2023, approximately 3% of our revenues and 24% of our expenses were in Colombian pesos. The remainder of our expenses and revenues were denominated, priced and realized in U.S. Dollars. In the future, and especially as we further expand our sales in other markets, our customers may increasingly make payments in non-U.S. currencies.
During the year ended December 31, 2024, approximately 2.8% of our revenues and 25% of our expenses were in Colombian pesos. The remainder of our expenses and revenues were denominated, priced and realized in U.S. Dollars. In the future, and especially as we further expand our sales in other markets, our customers may increasingly make payments in non-U.S. currencies.
We are subject to regional and national economic conditions in the United States. The economy in Florida and throughout the United States could negatively impact demand for our products as it has in the past, and macroeconomic forces such as employment rates and the availability of credit could have an adverse effect on our sales and results of operations.
The economy in Florida and throughout the United States could negatively impact demand for our products as it has in the past, and macroeconomic forces such as employment rates and the availability of credit could have an adverse effect on our sales and results of operations.
As of December 31, 2023, we and our subsidiaries on a consolidated basis had $173.4 million principal amount of debt outstanding. Our indebtedness could have negative consequences to our financial health.
As of December 31, 2024, we and our subsidiaries on a consolidated basis had $111.1 million principal amount of debt outstanding. Our indebtedness could have negative consequences to our financial health.
However, such measures, procedures and compliance may not be completely effective in preventing third parties from using us as a conduit for money laundering or terrorism financing without our knowledge, which could have a material adverse effect on our business, financial condition and results of operations.
However, such measures, procedures and compliance may not be completely effective in preventing third parties from using us as a conduit for money laundering or terrorism financing without our knowledge, which could have a material adverse effect on our business, financial condition and results of operations. 32 Changes in Colombia’s customs, import and export laws and foreign policy, may have an adverse effect on our financial condition and results of operations.
We have been advised that the courts of the Cayman Islands are unlikely (i) to recognize or enforce against us judgments of courts of the United States predicated upon the civil liability provisions of the securities laws of the United States or any State; and (ii) in original actions brought in the Cayman Islands, to impose liabilities against us predicated upon the civil liability provisions of the securities laws of the United States or any State, so far as the liabilities imposed by those provisions are penal in nature.
In addition, Cayman Islands companies may not have standing to initiate a shareholder’s derivative action in a Federal court of the United States. 34 We have been advised that the courts of the Cayman Islands are unlikely (i) to recognize or enforce against us judgments of courts of the United States predicated upon the civil liability provisions of the securities laws of the United States or any State; and (ii) in original actions brought in the Cayman Islands, to impose liabilities against us predicated upon the civil liability provisions of the securities laws of the United States or any State, so far as the liabilities imposed by those provisions are penal in nature.
We have entered into significant transactions with affiliates or other related parties, which may result in conflicts of interest. We have entered into transactions with affiliates or other related parties in the past and may do so again in the future.
We have entered into transactions with affiliates or other related parties in the past and may do so again in the future.
In particular, the Cayman Islands has a different body of securities laws as compared to the United States, and certain states, such as Delaware, may have more fully developed and judicially interpreted bodies of corporate law. In addition, Cayman Islands companies may not have standing to initiate a shareholder’s derivative action in a Federal court of the United States.
In particular, the Cayman Islands has a different body of securities laws as compared to the United States, and certain states, such as Delaware, may have more fully developed and judicially interpreted bodies of corporate law.
We are a holding company and derive substantially all of our operating income from our subsidiaries. All of our assets are held by our subsidiaries, and we rely on the earnings and cash flows of our subsidiaries to meet our debt service obligations or dividend payments.
All of our assets are held by our subsidiaries, and we rely on the earnings and cash flows of our subsidiaries to meet our debt service obligations or dividend payments.
In recent years we have made significant capital expenditures which include: ● Automation of six window assembly production lines, increasing efficiencies, labor and material waste costs with an estimated reduction of on-site damage by 30%; ● Additional aluminum expansion project to increase capacity by approximately 400 tons/month; ● Further automation of additional glass lines, increasing efficiencies on an end-to-end basis reducing lead times, headcount and on-site damage by approximately 40%; ● Upgrading vacuum magnetron sputter coating machinery which will allow us to coat glass before tempering; ● Automation of two centralized aluminum warehouses for storing, sorting and delivering extrusion matrices and aluminum profiles to our internal production processes that reduce lead times for the assembly of architectural systems and reduce on-site damage to materials; ● Acquiring 1.5 million square feet of land adjacent to our existing facilities for future expansion and for our sport facility complex available to factory employees; and ● Establishing new vinyl window assembly lines with annualized capacity of approximately $300 million There can be no assurance that the anticipated cost saving initiatives will be achieved, or that they will not be significantly and materially less than anticipated, or that the completion of such cost savings initiatives will be effectively accomplished.
In recent years, we have made significant capital expenditures which include: ● Automation of window assembly production lines, increasing efficiencies, labor and material waste costs with an estimated reduction of on-site damage by 30%; ● Additional aluminum expansion project to increase capacity by approximately 400 tons/month; ● Further automation of additional glass lines, increasing efficiencies on an end-to-end basis reducing lead times, headcount and on-site damage by approximately 40%; ● Upgrading vacuum magnetron sputter coating machinery which will allow us to coat glass before tempering; ● Automation of two centralized aluminum warehouses for storing, sorting and delivering extrusion matrices and aluminum profiles to our internal production processes that reduce lead times for the assembly of architectural systems and reduce on-site damage to materials; ● Acquiring 1.5 million square feet of land adjacent to our existing facilities for future expansion and for our sport facility complex available to factory employees; ● Establishing new vinyl window assembly lines with annualized capacity of approximately $300 million; and ● Entering the second phase of [expanding] our architectural metal facade plant, which specializes in engineering, designing, and manufacturing tailor-made facades.
Government policies and actions and judicial decisions in Colombia could significantly affect the local economy and, as a result, our results of operations and financial condition in the future.
Any future deterioration in relations with Venezuela and Nicaragua may result in the closing of borders, risk of financial condition. Government policies and actions and judicial decisions in Colombia could significantly affect the local economy and, as a result, our results of operations and financial condition in the future.
Our financial reporting obligations as a public company place a significant strain on our management, operational and financial resources, and systems. We may not be able to implement effective internal controls and procedures to detect and prevent errors in our financial reports, file our financial reports on a timely basis in compliance with SEC requirements, or prevent and detect fraud.
We may not be able to implement effective internal controls and procedures to detect and prevent errors in our financial reports, file our financial reports on a timely basis in compliance with SEC requirements, or prevent and detect fraud. Our management may not be able to respond adequately to changing regulatory compliance and reporting requirements.
Any litigation, investigations or other proceedings and the potential outcomes of such actions may divert the attention and resources of our officers and directors away from our operations and may negatively affect our reputation, which may adversely impact our operations and profitability.
Any litigation, investigations or other proceedings and the potential outcomes of such actions may divert the attention and resources of our officers and directors away from our operations and may negatively affect our reputation, which may adversely impact our operations and profitability. 25 We have entered into significant transactions with affiliates or other related parties, which may result in conflicts of interest.
The 2020 global economic crisis, resulting from the outbreak of the COVID-19 pandemic which negatively affected many economic sectors and countries around the world, had negative effects on the Colombian economy.
The 2020 global economic crisis, resulting from the outbreak of the COVID-19 pandemic which negatively affected many economic sectors and countries around the world, had negative effects on the Colombian economy. Although the Covid-19 effects have been contained as of December 2024, new variants may emerge and have a negative effect on the Colombian economy in the future.
Moreover, in November 2012, the International Court of Justice placed a sizeable area of the Caribbean Sea within Nicaragua’s exclusive economic zone. To this date, Colombia continues to deem this area as part of its own exclusive economic zone. Any future deterioration in relations with Venezuela and Nicaragua may result in the closing of borders, risk of financial condition.
Moreover, in November 2012, the International Court of Justice placed a sizeable area of the Caribbean Sea within Nicaragua’s exclusive economic zone. As of the date of this Annual Report, Colombia continues to deem this area as part of its own exclusive economic zone.
Colombia has experienced and continues to experience internal security issues that have had or could have a negative effect on the Colombian economy and our financial condition.
Additionally, fluctuating foreign currency exchange rates could impact the profitability of our foreign subsidiaries which are at the core of our business. Colombia has experienced and continues to experience internal security issues that have had or could have a negative effect on the Colombian economy and our financial condition.
In addition, if we are unable to obtain requisite approvals from Energy Holding Corporation, we may be prevented from executing critical elements of our business strategy. 24 We conduct all of our operations through our subsidiaries and will rely on payments from our subsidiaries to meet all of our obligations and may fail to meet our obligations if our subsidiaries are unable to make payments to us.
In addition, if we are unable to obtain requisite approvals from Energy Holding Corporation, we may be prevented from executing critical elements of our business strategy.
Changes in Colombia’s customs, import and export laws and foreign policy, may have an adverse effect on our financial condition and results of operations. Our business depends significantly on Colombia’s customs and foreign exchange laws and regulations, including import and export laws, as well as on fiscal and foreign policies.
Our business depends significantly on Colombia’s customs and foreign exchange laws and regulations, including import and export laws, as well as on fiscal and foreign policies.
We understand that the Cayman Islands Court’s decision in that case has been appealed and it remains the case that the law regarding the enforcement of bankruptcy/insolvency related judgments is still in a state of uncertainty. 33 If we fail to maintain proper and effective internal controls, our ability to produce accurate financial statements could be impaired, which could adversely affect our business.
We understand that the Cayman Islands Court’s decision in that case has been appealed and it remains the case that the law regarding the enforcement of bankruptcy/insolvency related judgments is still in a state of uncertainty.
Operating hazards inherent in our business, some of which may be outside of our control, can cause personal injury and loss of life, damage to or destruction of property, plant and equipment and environmental damage.
Such an accident could disrupt operations at any of our facilities, which could adversely affect our ability to deliver products to our customers on a timely basis and to retain our current business. 23 Operating hazards inherent in our business, some of which may be outside of our control, can cause personal injury and loss of life, damage to or destruction of property, plant and equipment and environmental damage.
Although the Covid-19 effects have been contained as of December 2023, new variants may emerge and have a negative effect on the Colombian economy in the future. 28 Even though exports from Colombia, principally petroleum and petroleum products, and gold, have grown in recent years, fluctuations in commodity prices pose a significant challenge to their contribution to the country’s balance of payments and fiscal revenues.
Even though exports from Colombia, principally petroleum and petroleum products, and gold, have grown in recent years, fluctuations in commodity prices pose a significant challenge to their contribution to the country’s balance of payments and fiscal revenues. Unemployment continues to be high in Colombia compared to other economies in Latin America.
As a result, Colombian Central Bank (“Banco de la República”) raised its monetary policy rate from 12% as of December 31, 2022, to 13% as of December 31, 2023, leading annual inflation rate to close at 9.28% as of December 2023. In addition, minimum wage for 2024 was agreed to increase 12%.
A high Monetary Interest Rate of 13% form Banco de la Republica at December 2023 reduced the annual inflation rate from 9.28% as of December 2023 to 5.20% as of December 2024. In addition, minimum wage for 2024 was agreed to increase by 9.5%.
In addition, recent military tensions between the United States alongside certain allies, and Yemen’s Houthi group, has negatively impacted global commercial trade, as many ships are not being able to navigate through the Suez Canal. 29 Further escalation of conflict can lead to severe constraints on global supply chains such as logistics obstructions, raw material price increases and shortages, and higher energy costs.
Trade restrictions imposed on Russia have led to increasing prices of oil, fluctuation in commodities markets and destabilizing many foreign currencies exchange rates. In addition, military tensions between the United States alongside certain allies, and Yemen’s Houthi group, has negatively impacted global commercial trade, as many ships are not being able to navigate through the Suez Canal.
The Colombian Peso appreciated 20.5% in 2023, after a 20.7% depreciation during 2022, as a result of political instability since 2022 presidential elections.
In recent years, the Colombian currency had shown some short-term volatility vis-à-vis the U.S. Dollar. The Colombian Peso depreciated 15.4% in 2024, after a 20.5% appreciation during 2023, as a result of political instability since 2022 presidential elections.
In addition, tax authorities and competent courts may interpret tax regulations differently than us, which could result in tax litigation and associated costs and penalties in part due to the novelty and complexity of new regulation. 32 We are subject to various U.S. export controls and trade and economic sanctions laws and regulations that could impair our ability to compete in international markets and subject us to liability if we are not in full compliance with applicable laws.
As regulatory environments evolve, new or heightened financial and operational obligations could materially and adversely affect our business. 33 We are subject to various U.S. export controls and trade and economic sanctions laws and regulations that could impair our ability to compete in international markets and subject us to liability if we are not in full compliance with applicable laws.
Based on data as of October 2023, fiscal deficit is expected to close at 4.3% of GDP, due to higher tax collection, COP revaluation against USD, and lower costs of debt resulting from inflation indexed bonds, during the year. In recent years, the Colombian currency had shown some short-term volatility vis-à-vis the U.S. Dollar.
Colombia’s fiscal deficit and growing public debt could adversely affect the Colombian economy. During 2022, Colombia’s fiscal deficit represented 5.5% of its GDP. As of December 31, 2023, the fiscal deficit closed at 4.3% of GDP, due to higher tax collection, COP revaluation against USD, and lower costs of debt resulting from inflation indexed bonds, during the year.
Unemployment continues to be high in Colombia compared to other economies in Latin America. Furthermore, recent political and economic actions in the Latin American region, including actions taken by the Venezuelan government, may negatively affect international investor perception of the region.
Furthermore, recent political and economic actions in the Latin American region, including actions taken by the Venezuelan government, may negatively affect international investor perception of the region. We cannot assure you that growth achieved over the past decade by the Colombian economy will continue in future periods.
We cannot assure you that growth achieved over the past decade by the Colombian economy will continue in future periods. The long-term effects of the global economic and financial crisis on the international financial system remain uncertain.
The long-term effects of the global economic and financial crisis on the international financial system remain uncertain.
The investigation is not expected to be completed until late in the second half of 2024. As a result of this investigation, imports of our goods which are considered subject merchandise might be subject to anti-dumping duties. If that were the case, it might adversely impact our results of operations.
As a result of this investigation, imports of some of our goods which are considered subject merchandise were subject to anti-dumping duties, until the International Trade Commission concluded in October 21, 2024 that American Aluminum producers were not being harmed and revoked said anti-dumping duty.
Our strategy of continued geographic diversification seeks to reduce our exposure to such region-specific risks. Global trade tensions and political conditions in the United States, as well as the U.S. government’s approach to NAFTA and/or other trade agreements, treaties or policies, may adversely affect our results of operations and financial condition.
Our strategy of continued geographic diversification seeks to reduce our exposure to such region-specific risks. 30 Armed conflicts around the globe, including sanctions and tensions between United States, NATO allies and several eastern countries, may adversely affect the results of our operations.
Removed
Such an accident could disrupt operations at any of our facilities, which could adversely affect our ability to deliver products to our customers on a timely basis and to retain our current business.
Added
There can be no assurance that the anticipated cost saving initiatives will be achieved, or that they will not be significantly and materially less than anticipated, or that the completion of such cost savings initiatives will be effectively accomplished.
Removed
The ratings reflect their expectation of fiscal deficit recovery and stable net debt over total GDP, driven by moderate economic growth. Colombia’s real GDP increased 0.6% in 2023. Global inflationary pressures and lower interest rates during 2022, led Colombia to reach an annual inflation rate of 13.28% in May 2023.
Added
We conduct all of our operations through our subsidiaries and will rely on payments from our subsidiaries to meet all of our obligations and may fail to meet our obligations if our subsidiaries are unable to make payments to us. We are a holding company and derive substantially all of our operating income from our subsidiaries.
Removed
Colombia’s fiscal deficit and growing public debt could adversely affect the Colombian economy. Since the start of the Covid-19 pandemic, increased government expenses and lower tax collection raised the fiscal deficit up to 7.8% of GDP in 2020.
Added
The ratings reflect their expectation of fiscal deficit to remain under levels established by the Autonomous Fiscal Rule Committee, and moderate economic growth. Colombia’s real GDP increased 1.7% in 2024.
Removed
In 2021 and 2022, economic recovery along with higher tax collection, and lower expenses associated to COVID-19, decreased fiscal deficit to 7.5%, and 5.5% of GDP, respectively.
Added
The fiscal deficit is expected to increase to 5.6% of Colombia’s GDP as of December 31, 2024, related to increased government spending to fund new social and environmental reforms, and lower expected tax collections during the year. This fiscal deficit increase might result on a lower credit rating, and higher interest rates for new issued Colombian sovereign debt.
Removed
Our operations are located in Colombia and may be, to varying degrees, affected by economic and market conditions in other countries. Trade barriers being erected by major economies may limit our ability to sell products in other markets and execute our growth strategies. Economic conditions in Colombia are correlated with economic conditions in the United States.
Added
Our business could be negatively impacted by potential tariffs imposed by the U.S government and trade tensions between the U.S. and Colombia. In January 2025, the U.S. government abruptly announced a 25% punitive tariff on Colombian imports after Colombian President Gustavo Petro refused to accept two U.S. military planes carrying deported Colombian citizens.
Removed
As a result, any downturn in economic activity could have a negative impact on our business in the United States, which as of December 31, 2023, accounted for 95% of our net operating revenues. The termination or re-negotiation of free trade agreements or other related events could also indirectly have an adverse effect on the Colombian economy.
Added
Although the tariff was revoked before taking effect (after Colombia agreed to certain terms and assumed repatriation costs using its own aircraft. This incident underscores the unpredictability of U.S. foreign relations with Colombia and other countries. The U.S. has since imposed similar tariffs on Canada, Mexico, and China, further demonstrating the risk of sudden trade restrictions.
Removed
Although economic conditions in other emerging market countries and in the United States may differ significantly from economic conditions in Colombia, investors’ reactions to developments in other countries may have an adverse effect on the market value of securities of Colombian companies.
Added
Given that our manufacturing facility is based in Colombia and 96% of our sales for the fiscal year ended December 31, 2024 ocurred in the United States, any new tariffs or trade barriers could materially impact our costs, disrupt our supply chain, and reduce our price competitiveness.
Removed
There can be no assurance that future developments in other emerging market countries and in the United States, over which we have no control, will not have a material adverse effect on our liquidity.
Added
Additionally, future diplomatic disputes or broader protectionist policies may lead to further trade restrictions, negatively affecting our financial performance. We are subject to trade investigations conducted by U.S. authorities over Colombian products that may result in additional duties for our products.
Removed
The results of the upcoming 2024 presidential elections in the United States could have a major impact on bilateral relations, economic cooperation, and regional security between Colombia and U.S. Increased U.S pressure on Colombia to align with its geopolitical interests may result in a reduction of U.S commercial trade and direct investment in Colombia.
Added
If such an anti-dumping measure were to be imposed, it might adversely impact our results of operations We are subject to regional and national economic conditions in the United States.
Removed
Multiple economic sanctions against Russia are being imposed by many countries worldwide which has impacted the global economy as many commercial, industrial and financial businesses are closing operations in Russia. Trade restrictions imposed on Russia have led to increasing prices of oil, fluctuation in commodities markets and destabilizing many foreign currencies exchange rates.
Added
Further escalation of conflict can lead to severe constraints on global supply chains such as logistics obstructions, raw material price increases and shortages, and higher energy costs. Disruptions in global supply chains can adversely affect our ability to manufacture and deliver product to our customers.
Removed
Disruptions in global supply chains can adversely affect our ability to manufacture and deliver product to our customers. Additionally, fluctuating foreign currency exchange rates could impact the profitability of our foreign subsidiaries which are at the core of our business.
Added
On July 28, 2024 political tensions rose as Nicolas Maduro was reelected president of Venezuela for the 2025-2031 period, although many countries, recognized Edmundo Gonzales as Venezuelan head of state., the Colombian government haven’t officially pronounced on this matter as of the date of this report.
Removed
Political tensions in Venezuela rose in January 2019 as several countries, including Colombia, did not recognize the legitimacy of Nicolás Maduro as Venezuelan head of state. However, as of December 31, 2023, Colombia’s new government is aiming to reestablish political and commercial relations with Venezuela.
Added
In addition, tax authorities and competent courts may interpret tax regulations differently than us, which could result in tax litigation and associated costs and penalties in part due to the novelty and complexity of new regulation. Beyond taxation, regulatory changes to labor laws in Colombia may also impact our cost structure.
Removed
The territorial dispute between Venezuela and Guyana, starting on November 1, 2023 when Venezuela unilaterally declared the Esequibo region of Guyana as a part of Venezuela, may affect Colombia’s political and commercial relations with Venezuela, as many commercial allies including United States, Brazil, and the United Kingdom, support Guyana.
Added
A new labor reform, passed on October 17, 2024, introduced changes to night and weekend pay, including an earlier start for nightly surcharges and increased extra pay for these shifts. Additionally, the ongoing phased reduction of the workweek, which is set to reach 42 hours by 2026, may further impact labor costs.
Removed
The potential escalation of the conflict could have significant impact on Colombia, which could in turn disrupt trade and investment in the region. This could have an adverse impact on our results of operations.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur cybersecurity team is deeply integrated into our risk management process, led by the Director of Information and Technology and our Cybersecurity Coordinator, who periodically review and update our incident response plan, and collaborate with subject matter specialists to ensure a comprehensive approach identifying and managing material cybersecurity threats. An established Information security committee contributes to a vigilant cybersecurity stance.
Biggest changeTogether, they periodically review and update our incident response plan, and collaborate with subject matter specialists to ensure a comprehensive approach to identifying and managing material cybersecurity threats . An established Information security committee contributes to a vigilant cybersecurity stance.
Our information security framework is based on the NIST Cybersecurity Framework, which along with continuous vigilance through ongoing vulnerability analyses, internal/external testing, alerts and reviews of cybersecurity events, our comprehensive strategic risk assessment which is achieved with collaboration of multidisciplinary teams, and our vendor management which includes a robust contracting process and engages third parties for cybersecurity support, ensure a resilient operation.
Our information security framework is based on the NIST Cybersecurity Framework, which along with continuous vigilance through ongoing vulnerability analyses, internal/external testing, alerts and reviews of cybersecurity events, our comprehensive strategic risk assessment is achieved with collaboration of multidisciplinary teams, and our vendor management that includes a robust contracting process and engages third parties for cybersecurity support, ensure a resilient operation.
We conduct regular reviews other exercises to evaluate the effectiveness of our information security program and improve our security measures and planning. We currently have engaged an external assessor and may in the future determine to engage an assessor(s), consultant(s), auditor(s) or other third party(s) to supplement our processes.
We conduct regular reviews and other exercises to evaluate the effectiveness of our information security program and improve our security measures and planning. We currently engage an external assessor and may in the future determine to engage an assessor(s), consultant(s), auditor(s) or other third party(s) to supplement our processes.
Added
One of the Audit Committee members has a Bachelor’s degree in Computer Science, is Certified in AI from MIT, and serves as the cybersecurity expert on the board of another company, bringing relevant expertise in cybersecurity and technology risk management. 37 Our cybersecurity team is deeply integrated into our risk management process, led by the Director of Information and Technology and our Cybersecurity Coordinator.
Added
Since 2022, the Director has overseen the company’s cybersecurity strategy, engaging with leading vendors, participating in industry events such as CPX, and leading the 2024 security policy redesign with an external advisor. The Cybersecurity Coordinator, a certified expert in ISO27001 and ISO27032, specializes in ethical hacking, SOC management, network security, and standards compliance, ensuring a well-documented and secure cybersecurity architecture.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties. We own and operate a total of 5.6 million square feet of manufacturing facilities. Our main 5.4 million square foot manufacturing complex, located in Barranquilla, Colombia, houses a glass production plant, aluminum plant and window and facade assembly plant.
Biggest changeItem 2. Properties. We own and operate a total of 5.8 million square feet of manufacturing facilities. Our main 5.5 million square foot manufacturing complex, located in Barranquilla, Colombia, houses a glass production plant, aluminum plant and window and facade assembly plant.
We believe that our existing properties are adequate for the current operating requirements of our business and that additional space will be available as needed. 36
We believe that our existing properties are adequate for the current operating requirements of our business and that additional space will be available as needed.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed2 unchanged
Biggest changeHowever, with the information at our disposition as this time, there are no indications that such claims will result in a material adverse effect on our business, financial condition or results of operations. Item 4. Mine Safety Disclosures. Not Applicable. PART II
Biggest changeHowever, with the information at our disposition as this time, there are no indications that such claims will result in a material adverse effect on our business, financial condition or results of operations.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

5 edited+1 added−2 removed4 unchanged
Biggest changeThe graph assumes an investment at the close of trading on December 29, 2023, and assumes the shareholder opted for share dividends during all periods. 38 Repurchases Share repurchase activity during the months within the fourth quarter of the fiscal year ended December 31, 2023 was as follows: Periods Total Number of Shares Purchased Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs(1) October 2, 2023 Open market and privately negotiated purchases 67,850 $ 32.9 67,850 October 3, 2023 Open market and privately negotiated purchases 87,287 $ 32.4 87,287 October 4, 2023 Open market and privately negotiated purchases 34,411 $ 32.3 34,411 October 24, 2023 Open market and privately negotiated purchases 80,000 $ 32.3 80,000 October 25, 2023 Open market and privately negotiated purchases 15,666 $ 32.4 15,666 October 26, 2023 Open market and privately negotiated purchases 17,896 $ 32.5 17,896 October 27, 2023 Open market and privately negotiated purchases 43,748 $ 32.5 43,748 November 9, 2023 Open market and privately negotiated purchases 60,373 $ 32.3 60,373 November 10, 2023 Open market and privately negotiated purchases 1,898 $ 32.5 1,898 November 13, 2023 Open market and privately negotiated purchases 2,838 $ 33.0 2,838 November 16, 2023 Open market and privately negotiated purchases 37,216 $ 34.4 37,216 December 15, 2023 Open market and privately negotiated purchases 100 $ 35.8 - Total 678,065 $ 34.7 676,515 $ 26,527,637 (1) On November 3, 2022, the Board of Directors authorized the purchase of up to $50 million of the Company’s common shares.
Biggest changeThe graph assumes an investment at the close of trading on December 31, 2024, and assumes the shareholder opted for share dividends during all periods. 39 Repurchases Share repurchase activity during the months of the fourth quarter of the fiscal year ended December 31, 2024 was as follows: Periods Total Number of Shares Purchased Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs(1) October 7, 2024 Open market and privately negotiated purchases 500 $ 56.96 $ 28,480 - October 30, 2024 Open market and privately negotiated purchases 610 $ 56.96 $ 34,746 - December 11, 2024 Open market and privately negotiated purchases 3,740 $ 56.96 $ 213,030 - Total 4,850 $ 276,256 $ 76,527,637 (1) On November 3, 2022, the Board of Directors authorized the purchase of up to $50 million of the Company’s common shares, which authorization was subsequently increased to up to $100 million in November 2024.
The program does not obligate the Company to acquire a minimum amount of shares. Under the program, shares may be repurchased in privately negotiated and/or open market transactions, including under plans complying with Rule 10b5-1 under the Exchange Act.
The program does not obligate the Company to acquire a minimum number of shares. Under the program, shares may be repurchased in privately negotiated and/or open market transactions, including under plans complying with Rule 10b5-1 under the Exchange Act.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our ordinary shares are listed on the New York Stock Exchange under the symbol “TGLS”. Holders As of December 31, 2023, there were 284 holders of record of our ordinary shares.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our ordinary shares are listed on the New York Stock Exchange under the symbol “TGLS”. Holders As of December 31, 2024, there were 222 holders of record of our ordinary shares.
The ability of our subsidiaries in Colombia to declare dividends up to the total amount of their capital is not restricted by current laws, covenants in debt agreements or other agreements.
The ability of our subsidiaries in Colombia to declare dividends up to the total amount of their capital is not restricted by current laws, covenants in debt agreements or other agreements. Recent Sales of Unregistered Securities None.
The payment of dividends in the future, if any, will also be contingent upon our revenues and earnings, if any, capital requirements and our general financial condition and limitations imposed by our outstanding indebtedness. 37 Because we are a holding company, our ability to pay dividends depends on our receipt of cash dividends from our operating subsidiaries, which may further restrict our ability to pay dividends as a result of the laws of their jurisdictions of organization, agreements of our subsidiaries or covenants under any existing and future outstanding indebtedness we or our subsidiaries incur.
Because we are a holding company, our ability to pay dividends depends on our receipt of cash dividends from our operating subsidiaries, which may further restrict our ability to pay dividends as a result of the laws of their jurisdictions of organization, agreements of our subsidiaries or covenants under any existing and future outstanding indebtedness we or our subsidiaries incur.
Removed
Recent Sales of Unregistered Securities In connection with our Saint-Gobain joint venture, on October 28, 2020, we paid $10.9 million for a lot of land through the issuance of an aggregate of 1,557,142 ordinary shares of the Company to affiliates of the Chief Executive Officer and Chief Operating Officer’s family, valued at $7.00 per share, which represented an approximate 33% premium based on the closing stock price on October 27, 2020.
Added
The payment of dividends in the future, if any, will also be contingent upon our revenues and earnings, if any, capital requirements and our general financial condition and limitations imposed by our outstanding indebtedness.
Removed
The land was later contributed in December as payment for our 25.8% interest in Vidrio Andino. The ordinary shares were issued in reliance on an exemption from registration under Section 4(a)(2) of the Securities Act as they were issued in a transaction by an issuer not involving any public offering.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

34 edited+16 added−40 removed37 unchanged
Biggest changeNon-operating income was comprised primarily of income from rental properties and gains on sale of scrap materials and charges to customers on credit card payments, as well as non-operating expenses related to certain charitable contributions outside of the Company’s direct sphere of influence.
Biggest changeNon-operating income for the period is comprised primarily of interest income from short-term investments, income from rental properties and gains on sale of scrap materials as well as non-operating expenses related to certain charitable contributions outside of the Company’s direct sphere of influence. 44 Interest expense and deferred cost of financing decreased $1.7 million, or 19.0%, to $7.4 million during the year ended December 31, 2024, from $9.2 million during the year ended December 31, 2023, as the Company voluntarily prepaid $62.0 million to reduce its debt balance and benefited from having a favorable interest rate hedge in place for 100% of its outstanding debt.
Our track record of successfully delivering high profile projects has earned us an increasing number of opportunities across the United States, evidenced by our expanding backlog and overall revenue growth. 39 Our structural competitive advantage is underpinned by our low-cost manufacturing footprint, vertically integrated business model and geographic location.
Our track record of successfully delivering high profile projects has earned us an increasing number of opportunities across the United States, evidenced by our expanding backlog and overall revenue growth. Our structural competitive advantage is underpinned by our low-cost manufacturing footprint, vertically integrated business model and geographic location.
Non-operating income is comprised primarily of interest income from short term investments and deposits, rental properties and gains on sale of scrap materials and charges to customers on credit card payments, as well as non-operating expenses related to certain charitable contributions outside of the Company’s direct sphere of influence. 43 Interest expense and deferred cost of financing increased $1.0 million, or 12.5%, to $9.2 million during the year ended December 31, 2023, from $8.2 million during the year ended December 31, 2022, reflecting an increase in floating interest rates while our debt balance remained stable.
Non-operating income is comprised primarily of interest income from short term investments and deposits, rental properties and gains on sale of scrap materials and charges to customers on credit card payments, as well as non-operating expenses related to certain charitable contributions outside of the Company’s direct sphere of influence. 45 Interest expense and deferred cost of financing increased $1.0 million, or 12.5%, to $9.2 million during the year ended December 31, 2023, from $8.2 million during the year ended December 31, 2022, reflecting an increase in floating interest rates while our debt balance remained stable.
In addition to glass, we manufacture aluminum and vinyl products such as profiles, rods, bars, plates, and other hardware specifically designed for window manufacturing. Our products are manufactured in a 5.6 million square foot, state-of-the-art manufacturing complex in Barranquilla, Colombia that provides easy access to North, Central and South America, the Caribbean and the Pacific.
In addition to glass, we manufacture aluminum and vinyl products such as profiles, rods, bars, plates, and other hardware specifically designed for window manufacturing. 40 Our products are manufactured in a 5.8 million square foot, state-of-the-art manufacturing complex in Barranquilla, Colombia that provides easy access to North, Central and South America, the Caribbean and the Pacific.
On May 3, 2019, we consummated the joint venture agreement with Saint-Gobain, acquiring a 25.8% minority ownership interest in Vidrio Andino, a Colombia-based subsidiary of Saint-Gobain, solidifying our vertical integration strategy by acquiring an interest in the first stage of our production chain, while securing ample glass supply for our expected production needs.
In 2019 we consummated the joint venture agreement with Saint-Gobain, acquiring a 25.8% minority ownership interest in Vidrio Andino, a Colombia-based subsidiary of Saint-Gobain, solidifying our vertical integration strategy by acquiring an interest in the first stage of our production chain, while securing ample glass supply for our expected production needs.
Recent examples of our high return investments within the last two years include: ● Automation of six window assembly production lines, increasing efficiencies, labor and material waste costs with an estimated reduction of on-site damage by 30%; ● Additional aluminum expansion project to increase capacity by approximately 400 tons/month; ● Further automation of additional glass lines, increasing efficiencies on an end-to-end basis reducing lead times, headcount and on-site damage by approximately 40%; ● Upgrading vacuum magnetron sputter coating machinery which will allow to coat glass before tempering; ● Automation of two centralized aluminum warehouses for storing, sorting and delivering extrusion matrices and aluminum profiles to our internal production processes that reduce lead times for the assembly of architectural systems and reduce on-site damage to materials; ● Acquiring 1.5 million square feet of land adjacent to our existing facilities for future expansion and for our sport facility complex available to factory employees; and ● Establishing new vinyl window assembly lines with annualized capacity of approximately $300 million.
Recent examples of our high return investments within the last three years include: ● Further automation of window assembly production lines, increasing efficiencies, labor and material waste costs with an estimated reduction of on-site damage by 30%; ● Additional aluminum expansion project to increase capacity by approximately 400 tons/month; ● Further automation of additional glass lines, increasing efficiencies on an end-to-end basis reducing lead times, headcount and on-site damage by approximately 40%; ● Upgrading vacuum magnetron sputter coating machinery which will allow us to coat glass before tempering; ● Automation of two centralized aluminum warehouses for storing, sorting and delivering extrusion matrices and aluminum profiles to our internal production processes that reduce lead times for the assembly of architectural systems and reduce on-site damage to materials; ● Acquiring 1.5 million square feet of land adjacent to our existing facilities for future expansion and for our sport facility complex available to factory employees; ● Establishing new vinyl window assembly lines with annualized capacity of approximately $300 million; and ● Entering the second phase of [expanding] our architectural metal facade plant, which specializes in engineering, designing, and manufacturing tailor-made facades.
On May 3, 2019, we consummated a joint venture agreement with Saint-Gobain, a world leader in the production of float glass, a key component of our manufacturing process, whereby we acquired a 25.8% minority ownership interest in Vidrio Andino, a Colombia-based subsidiary of Saint-Gobain.
In 2019 we entered into a joint venture agreement with Saint-Gobain, a world leader in the production of float glass, a key component of our manufacturing process, whereby we acquired a 25.8% minority ownership interest in Vidrio Andino, a Colombia-based subsidiary of Saint-Gobain.
The United States accounted for 95%, and 96% of our combined revenues in 2023 and 2022, respectively, while Colombia accounted for approximately 3% and 2%, and other Latin-American destinations accounted for approximately 2% during both years.
The United States accounted for 96%, and 95% of our combined revenues in 2024 and 2023, respectively, while Colombia accounted for approximately 2.8% and 3.0%, and other Latin-American destinations accounted for approximately 1.7% during both years.
As a result of the foregoing, the Company recorded a net income for the year ended December 31, 2022 of $156.4 million compared to $68.4 million in the year ended December 31, 2021. Cash Flow from Operations, Investing and Financing Activities During the year ended December 31, 2023 and 2022, operating activities generated approximately $138.8 million and $141.9 million, respectively.
As a result of the foregoing, the Company recorded net income for the year ended December 31, 2023 of $183.5 million compared to $156.4 million in the year ended December 31, 2022. Cash Flow from Operations, Investing and Financing Activities During the years ended December 31, 2024 and 2023, operating activities generated approximately $170.5 million and $138.8 million, respectively.
In the United States, which is our largest market, we were ranked as the third largest glass fabricator serving the United States in 2023 by Glass Magazine. In addition, we believe we are the leading glass transformation company in Colombia.
In the United States, which is our largest market, we were ranked among the four largest glass fabricators serving the United States in 2023 by Glass Magazine. In addition, we believe we are the leading glass transformation company in Colombia.
Strong sales during 2023 were driven by U.S. commercial and single-family residential market activity. U.S. sales increased $106.7 million, or 15.5%, from $688.4 million in 2022 to $795.1 million in 2023. U.S. Commercial market sales increased $77.7 million, or 20.3%, from $382.0 million in 2022 to $459.7 million in 2023 as we continue to execute on our growing backlog.
U.S. sales increased $106.7 million, or 15.5%, from $688.4 million in 2022 to $795.1 million in 2023. U.S. Commercial market sales increased $77.7 million, or 20.3%, from $382.0 million in 2022 to $459.7 million in 2023 as we continue to execute on our growing backlog.
During the year ended December 31, 2023, we paid $78.0 million to acquire property, plant and equipment, which in combination with $9.3 million acquired under credit, amount to total capital expenditures of $87.3 million. During 2022, we used $71.3 million for the acquisition or property and equipment.
During the year ended December 31, 2024, we paid $79.6 million to acquire property plant and equipment, which in combination with $6.4 million acquired under credit or debt, amount to total capital expenditures of $86.0 million. During the year ended December 31, 2023, we used $78.0 million for the acquisition of property and equipment.
As a result of the foregoing, the Company recorded net income for the year ended December 31, 2023 of $183.5 million compared to $156.4 million in the year ended December 31, 2022.
As a result of the foregoing, the Company recorded a net income for the year ended December 31, 2024 of $161.3 million compared to $183.5 million for the year ended December 31, 2023.
Comparison of years ended December 31, 2022 and December 31, 2021 Our operating revenue increased $219.8 million, or 44.2%, from $496.8 million in the year ended December 31, 2021 to $716.6 million in the year ended December 31, 2022. Strong sales during 2022 were driven by U.S. single family residential and commercial market activity.
Comparison of years ended December 31, 2023 and December 31, 2022 Our operating revenue increased $116.7 million, or 16.3%, from $716.6 million in the year ended December 31, 2022 to $833.3 million in the year ended December 31, 2023. Strong sales during 2023 were driven by U.S. commercial and single-family residential market activity.
Amounts representing modifications accounted for as part of the existing contract are included in the transaction price and recognized as an adjustment to sales on a cumulative catch-up basis. Trade Accounts Receivable Trade accounts receivable are recorded net of allowances for cash discounts for prompt payment, doubtful accounts and sales returns.
Amounts representing modifications accounted for as part of the existing contract are included in the transaction price and recognized as an adjustment to sales on a cumulative catch-up basis.
The new plant will be funded with proceeds from the original cash contribution made by the Company, operating cash flows from the Bogota plant, debt incurred at the joint venture level that will not consolidate into the Company and an additional contribution by us of approximately $12.5 million if needed (based on debt availability). 42 Results of Operations (Amounts in thousands) Twelve months ended December 31, 2023 2022 2021 Operating revenues $ 833,265 $ 716,570 $ 496,785 Cost of sales 442,331 367,071 294,201 Gross profit 390,934 349,499 202,584 Operating expenses (131,172 ) (123,084 ) (85,599 ) Operating income 259,762 226,415 116,985 Non-operating income and expenses, net 5,131 4,218 608 Foreign currency transactions gains / (losses) 686 2,013 (4,308 ) Interest expense and deferred cost of financing (9,178 ) (8,156 ) (9,850 ) Debt extinguishment - - (10,699 ) Income tax provision (77,904 ) (74,758 ) (28,485 ) Equity method income 5,013 6,680 4,177 Net income 183,510 156,412 68,428 Income attributable to non-controlling interest (628 ) (669 ) (277 ) Income attributable to parent $ 182,882 $ 155,743 $ 68,151 Comparison of years ended December 31, 2023 and December 31, 2022 Our operating revenue increased $116.7 million, or 16.3%, from $716.6 million in the year ended December 31, 2022 to $833.3 million in the year ended December 31, 2023.
The new plant will be funded with proceeds from the original cash contribution made by us, operating cash flows from the Bogota plant, debt incurred at the joint venture level that will not be consolidated into our company. 43 Results of Operations (Amounts in thousands) Twelve months ended December 31, 2024 2023 2022 Operating revenues $ 890,181 $ 833,265 $ 716,570 Cost of sales 510,209 442,331 367,071 Gross profit 379,972 390,934 349,499 Operating expenses (152,971 ) (131,172 ) (123,084 ) Operating income 227,001 259,762 226,415 Non-operating income and expenses, net 5,858 5,131 4,218 Foreign currency transactions (loss)/gains (5,665 ) 686 2,013 Interest expense and deferred cost of financing (7,433 ) (9,178 ) (8,156 ) Income tax provision (63,849 ) (77,904 ) (74,758 ) Equity method income 5,397 5,013 6,680 Net income 161,309 183,510 156,412 Income attributable to non-controlling interest - (628 ) (669 ) Income attributable to parent $ 161,309 $ 182,882 $ 155,743 Comparison of years ended December 31, 2024 and December 31, 2023 Our operating revenue increased $56.9 million, or 6.8%, from $833.3 million in the year ended December 31, 2023, to $890.2 million in the year ended December 31, 2024.
In late 2022, we launched two new showrooms, one in New York City and one in Charleston, SC, to serve primarily single-family residential markets in their regions. New showrooms have been completed in Houston, TX, and Bonita Springs, FL, and are expected to be fully operational early in 2024.
In late 2022, we launched two showrooms, one in New York City and one in Charleston, SC, to serve primarily single-family residential markets in their regions. New showrooms have been completed in Houston, TX, and Bonita Springs, FL. Additionally, showrooms in Phoenix, AZ and Los Angeles, CA are in the lease negotiating stages and are expected to open in 2025.
Our products can be found on some of the most distinctive buildings in these regions, including 100 Hood Park Drive (Boston), 601 West 29 th St (New York). Norwegian Cruise Line Terminal B (Miami), Paramount Miami Worldcenter (Miami), Via 57 West (New York), One65 Main (Cambridge), AE’O Tower (Honolulu), Salesforce Tower (San Francisco), and One Thousand Museum (Miami).
Our products can be found on some of the most distinctive buildings in these regions, including the Aston Martin Residences (Miami), Miami World Tower (Miami), 3ELEVEN (New York), Raffles Hotel (Boston), Norwegian Cruise Line Terminal B (Miami), One Thousand Museum (Miami), Paramount Miami Worldcenter (Miami), Salesforce Tower (San Francisco) and AE’O Tower (Honolulu)..
We anticipate that working capital will continue to be a net benefit to cash flow in the near future, which in addition to our current liquidity position, provides ample flexibility to service our obligations through the next twelve months. 41 Capital Resources We transform glass and aluminum into high specification architectural glass and custom-made aluminum profiles which require significant investments in state-of-the-art technology.
We anticipate that working capital will continue to be a net benefit to cash flow in the near future, which in addition to our current liquidity position, provides ample flexibility to service our obligations through the next twelve months.
As of December 31, 2023, our liquidity position was comprised of $170 million available under committed lines of credit, in addition to a cash balance of $129.5 million.
During the year ended December 31, 2024, the main source of cash was operating activities, which generated $170.5 million. 42 As of December 31, 2024, our liquidity position was comprised of $175.0 million available under committed lines of credit, in addition to a cash balance of $134.9 million.
In late October 2023, 30 year-fixed mortgage rates reached a 23 year high of 7.8% and decreased to 6.7% as of February 2024. These stable to positive macro trends in our core markets and geographies combined with a lean cost structure, leave us well positioned maintain industry leading margins and further diversify our presence into the U.S.
These stable to positive macro trends in our core markets and geographies combined with a lean cost structure, leave us well positioned to maintain industry leading margins and further diversify our presence into the U.S. Liquidity As of December 31, 2024, and December 31, 2023, we had cash and cash equivalents of approximately $134.9 million and $129.5 million, respectively.
We produce fixed body, sliding windows, projecting windows, guillotine windows, sliding doors and swinging doors. ES produces facade products which include: floating facades, automatic doors, bathroom dividers and commercial display windows.
Window production lines are defined depending on the different types of windows: normal, impact resistant, hurricane-proof, safety, soundproof and thermal. We produce fixed body, sliding windows, projecting windows, guillotine windows, sliding doors and swinging doors. ES produces facade products which include: floating facades, automatic doors, bathroom dividers and commercial display windows.
We paid $16.4 million and $12.9 million of dividends to holders of our ordinary shares during the years ended December 2023 and 2022, respectively. During the year ended December 31, 2023, we used $23.5 million to repurchase shares under the $50 million buyback program authorized by our Board of Directors.
We paid $19.7 million and $16.4 million of dividends to holders of our ordinary shares during the years ended December 31, 2024 and 2023, respectively.
Headquartered in Barranquilla, Colombia, we operate out of a 5.6 million square foot vertically integrated, state-of-the-art manufacturing complex that provides easy access to North, Central and South America, the Caribbean, and the Pacific.
Headquartered in Barranquilla, Colombia, we operate out of a 5.8 million square foot vertically integrated, state-of-the-art manufacturing complex that provides easy access to North, Central and South America, the Caribbean, and the Pacific. 41 Our glass products include tempered glass, laminated glass, thermo-acoustic glass, curved glass, silk-screened glass, and digital print glass as well as mill finished, anodized, painted aluminum and vinyl profiles, and produces rods, tubes, bars and plates.
We also have sales forces located in Colombia and Panama with long-standing business relationships in the region to serve Latin American markets.
We also have sales forces located in Colombia and Panama with long-standing business relationships in the region to serve Latin American markets. We have two types of sales operations: contract sales, which are the high-dollar, customer tailored projects, and standard form sales, which reflect lower-value orders that are of short duration.
During the years ended December 31, 2023, and 2022, we made investments primarily in building and construction, and machinery and equipment in the amounts of $87.3 million, and $83.1 million, respectively.
Capital Resources We transform glass and aluminum into high specification architectural glass and custom-made aluminum profiles which require significant investments in state-of-the-art technology. During the years ended December 31, 2024, and 2023, we made investments primarily in building and construction, and machinery and equipment in the amounts of $88.9 million, and $87.3 million, respectively.
During the year ended December 31, 2022, the Company recorded a non-operating gain of $2.0 million associated with foreign currency transactions. Comparatively, the Company recorded a net loss of $4.3 million during the year ended December 31, 2021, within the statement of operations as the Colombian peso depreciated 20.8% during the period.
During the year ended December 31, 2024, the Company recorded a non-operating net loss of $5.7 million associated with foreign currency transactions, compared to a net gain of $0.7 million during the year ended December 31, 2023.
Additionally, the Company paid $3.0 million to buy out the non-controlling interest in ESMetals. 45 Off-Balance Sheet Arrangements We did not have any material off-balance sheet arrangements as of December 31, 2023 or 2022. Critical Accounting Estimates The preparation of financial statements in conformity with U.S.
Additionally, during the year ended December 31, 2024, we used $64.5 million to repay debt from our Senior Secured Line of Credit and other smaller facilities. 46 Off-Balance Sheet Arrangements We did not have any material off-balance sheet arrangements as of December 31, 2024 or 2023. Critical Accounting Estimates The preparation of financial statements in conformity with U.S.
U.S. sales increased $232.0 million, or 50.8%, from $456.3 million in 2021 to $688.4 million in 2022. U.S. single family residential market sales increased $129.1 million, or 72.8%, from $177.4 million in 2021 to $306.4 million in 2022 and accounted for 42.8% of total sales in the year ended December 31, 2022.
U.S. single family residential market sales increased $36.7 million, or 10.9%, from $335.4 million in 2023 to $372.1 million in 2024 and accounted for 41.8% of total sales in the year ended December 31, 2024. Sales to Latin-American markets increased $2.1 million, or 5.4%, from $38.2 million in 2023 to $40.3 million in 2024.
Including assets acquired with debt or supplier credit, total capital expenditures during the period were $83.2 million. We also received dividends from our investment in Vidrio Andino for $2.3 million during 2023. Financing activities used $42.8 million and $44.8 million during the years ended December 31, 2023 and 2022, respectively.
Including assets acquired with debt or supplier credit, total capital expenditures during the period were $87.3 million. Financing activities used $84.5 million and $42.8 million during the year ended December 31, 2024, and 2023, respectively. On April 10, 2024, we paid $2,500 to Incantesimo SAS, related to the acquisition of the remaining 31% equity interest of ES Metals.
Favorable demographics in states such as South Carolina, Florida, Texas, and North Carolina, where we have a strong presence, contribute to continued growth. Despite the overall decline of housing permits in U.S. south region, down 9% year over year, from a very strong 2022; permits in key cities in Florida, where we maintain a strong presence, increased by 3%.
We expect to benefit from growth in our largest markets in the United States by gaining market share, broadening our geographic footprint. Favorable demographics in states such as South Carolina, Florida, Texas, and North Carolina, where we have a strong presence, contribute to continued growth.
The positive cashflow from operations during the year ended December 31, 2023, has been related to our industry leading profitability, and enhanced working capital efforts.
The strong cashflow from operations during the year ended December 31, 2024, was mainly associatedwith our industry leading profitability, and enhanced working capital efforts. The main sources of operating cash during the year ended December 31, 2024, were driven by trade accounts payable, and contract assets and liabilities.
Operating expenses increased $37.5 million, or 43.8%, from $85.6 million for the year ended December 31, 2021 to $123.1 million for the year ended December 31, 2022.
Despite the year over year reduction of gross profit margin, gross margin sequentially increased during the year ended December 31, 2024. Operating expenses increased $21.8 million, or 16.6%, from $131.2 million to $153.0 million for the year ended December 31, 2023 and 2024, respectively.
The largest use of cash in operating activities were other assets, comprised primarily of prepaid taxes, which used $27.5 million during the year ended December 31, 2023, related to the aggregate of $107.2 million related to income taxes paid during the period, most of which was paid by the Colombian subsidiaries during the second quarter of 2023.
Additionally, taxes payable used $3.5 million during the year ended December 31, 2024, resulted from taxes being paid during the period, as the Colombian subsidiaries fully paid their 2023 income tax during the second quarter of 2024. We used $77.3 million and $76.0 million in investing activities during the years ended December 31, 2024, and 2023, respectively.
Removed
Our glass products include tempered glass, laminated glass, thermo-acoustic glass, curved glass, silk-screened glass, and digital print glass as well as mill finished, anodized, painted aluminum and vinyl profiles, and produces rods, tubes, bars and plates. Window production lines are defined depending on the different types of windows: normal, impact resistant, hurricane-proof, safety, soundproof and thermal.
Added
According to the U.S Census Bureau, average residential construction spending increased 6.2% in 2024, from $875 billion in 2023, to $930 billion in 2024. Addittionally, single family housing stars increased 6.5% in 2024.
Removed
We have two types of sales operations: contract sales, which are the high-dollar, customer tailored projects, and standard form sales, which reflect lower-value orders that are of short duration. 40 We expect to benefit from growth in our largest markets in the United States by gaining market share, broadening our geographic footprint.
Added
According to the FMI’s 2025 north American engineering and contruction overview, single family residential construction in the U.S is expected to increase at a compound aunual growth rate of 6% until 2028, highly driven by interest rates buydowns.
Removed
Additionally, according to Key Media Research (“KMR”) data, U.S. nonresidential building construction put in place is expected to continue expanding through 2024, at an annualized rate of 4.6% to $800 billion, and projected to remain at similar levels through 2026.
Added
Remodeling and reparing activity, Is also expected to trend up over the next years as new home prices remain at all-time high levels. On the other hand, the latest Nonresidential Construction Index (NRCI) score of 56.9, 20% above the previous quarter, reflects improving economic conditions and expanding industry opportunities from the commercial construction market for 2025.
Removed
Residential construction put in place in the U.S. is expected to increase 1.3% during 2024, after a 5.6% decrease presented in 2023. Borrowing costs are expected to decrease during 2024, as interest rates start to stabilize and probably decline.
Added
Income from this investment is recorded using the equity method and is presented within the Consolidated Statement of Operations as a component of non-operating income as the Company is not subject to income tax over this investment.
Removed
Liquidity As of December 31, 2023 and 2022, we had cash and cash equivalents of approximately $129.5 million and $103.7 million, respectively. During the year ended December 31, 2023, the main source of cash was operating activities, which generated $138.8 million.
Added
The joint venture agreement includes plans to build a new plant that will be located approximately 20 miles from our primary manufacturing facility in Barranquilla Colombia, in which we will also have a 25.8% interest.
Removed
The purchase price for our interest in Vidrio Andino was $45 million, of which $34.1 million was paid in cash and $10.9 million paid through the contribution of land on December 9, 2020.
Added
Strong sales during 2024 were driven by U.S. commercial and single-family residential market activity. U.S. sales increased $54.8 million, or 6.9%, from $795.1 million in 2023 to $849.9 million in 2024. U.S. Commercial market sales increased $18.1 million, or 3.9%, from $459.7 million in 2023 to $477.8 million in 2024 as we continue to execute on our growing backlog.
Removed
On October 28, 2020, we acquired said land from a related party in exchange for an aggregate of 1,557,142 ordinary shares of the Company, valued at $7.00 per share, which represented an approximate 33% premium based on the closing stock price as of October 27, 2020.
Added
Gross profit during the year ended December 31, 2024, was $380.0 million, a decrease of $10.9 million, or 2.8%, from $390.9 million during the year ended December 31, 2023.
Removed
The land will serve the purpose of developing a second float glass plant nearby our existing manufacturing facilities which we expect will carry significant efficiencies for us once it becomes operative, in which we will also have a 25.8% interest.
Added
The gross profit margin during the year ended December 31, 2024, decreased to 42.7% from 46.9% during the year ended December 31, 2023, primarily related to a 5.9% appreciation of the Colombian Peso impacting our costs denominated in Colombian Pesos against our predominantly US Dollar revenue stream.
Removed
U.S. commercial market sales increased $102.9 million, or 36.9%, from $279.0 million in 2021 to $382.0 million in 2022 as we continued to execute on our growing backlog. Sales to Latin-American markets decreased $12.2 million, or 30.3%, from $40.5 million in 2021 to $28.2 million in 2022 as we focused our efforts on more attractive U.S. markets.
Added
Additionally, the year over year comparison was also impacted by our mix of revenue, with sales from installation projects, wich bears lower margins, now accounting for 18.2% of our total revenues for the year ended December 31, 2024, compared to 15.4% for the year ended December 31, 2023, as well as higher salaries which were adjusted by the government at the beginning of the year and higher headcount to adjust for ongoing growth, which accounted for 210 basis points of our gross margin deterioration.
Removed
Gross profit increased $146.9 million, or 72.5%, to $349.5 million during the year ended December 31, 2022, compared with $202.6 million during the year ended December 31, 2021. This resulted in gross profit margin reaching 48.8% during the year ended December 31, 2022, up from 40.8% during the year ended December 31, 2021.
Added
The increase was mainly driven by personnel expense, up $9.4 million from $35.7 million during the year ended December 31, 2023, to $45.1 million during the year ended December 31, 2024, due to administrative salary adjustments, and operating headcount increase to support our growing operation, resulting in 74 basis points deterioration of our operating margin; and by a negative effect in COP denominated amounts related to a 5.9% appreciation of the Colombian Peso against US Dollar over the period.
Removed
The 800-basis point improvement in gross margin was mainly attributable to operating leverage on higher sales, favorable product pricing dynamics, ongoing efficiency efforts, and favorable foreign exchange rates resulting from a depreciation of the Colombian peso.
Added
During the year ended December 31, 2024 and 2023, the Company recorded non-operating income of $5.9 and $5.1 million, respectively.
Removed
The increase was driven by $16.2 million, or 70.4%, increase in shipping expense resulting from sales increasing 44.2% along with some increases in shipping rates and a higher mix of sales going into the more atomized US residential market, a $3.4 million in non-recurring professional fees, and by a $4.6 million one-time settlement payment associated with a dispute related to a project. 44 During the years ended December 31, 2022 and 2021, the Company recorded net non-operating income of $4.2 million and $0.6 million, respectively.
Added
The effective income tax rate of 28.4% and 29.8% for the years ended December 31, 2024 and 2023, respectively, are below the average statutory rates of 31.3% and 30.4% during each of those periods, respectively, as the proportion of our taxable income shifted jurisdictions resulting from new developments of our product designs, trademarks and other intellectual property rights as well as from growing profit in US subsidiaries.
Removed
Interest expense and deferred cost of financing decreased $1.7 million, or 17.2%, to $8.2 million during the year ended December 31, 2022, from $9.9 million during the year ended December 31, 2021, despite increases in floating interest rates as a result of a reduction of our debt balance.
Added
Trade accounts payable generated $14.7 million during the year ended December 31, 2024, mainly as a result of our growing operation, while our days payable outstanding increased only slightly, compared with $17.4 million used during the year ended December 31, 2023.
Removed
During the years ended December 31, 2022 and 2021, the Company recorded an income tax provision of $74.8 million and $28.5 million, respectively, reflecting an effective income tax rate of 33.3% and 30.7%, respectively. The effective income tax rates for both years approximate the statutory rate of 33.8% and 29.6% for the fiscal years 2022 and 2021, respectively.
Added
In addition, contract assets and liabilities generated $14.3 million during the year ended December 31, 2024, mostly due to an increase in billings in excess of costs, as main projects are being executed, and large projects from our backlog are starting operations; compared to $13.9 million generated during the year ended December 31, 2023, as we executed on our growing backlog.
Removed
The main source of operating cash during the year ended December 31, 2023, were contract assets and liabilities, which generated $13.9 million, resulting from a combination of a decrease in retainage as several jobs in the US were finalized, a reduction of unbilled receivables tied to our advance on projects currently in execution, and increased advances received from customers.
Added
The largest use of cash in operating activities was trade accounts receivable, which used $44.4 million in the year ended December 31, 2024, compared with a use of $0.8 million during the prior year period, driven by an increase in pace of large commercial installation jobs during the third and fourth quarter of 2024, which entail longer cash cycles.
Removed
Comparatively, contract assets and liabilities generated $16.2 million during the year ended December 31, 2022.
Added
The main use of cash in investing activities during the year ended December 31, 2024 was related to scheduled payments on previous investments to increase capacity and efficiency as well as new investments in land and equipment.
Removed
Comparatively, other assets used $0.5 million during the year ended December 31, 2022, related to the return of prepaid value added taxes of Colombian subsidiaries offsetting income tax payments during 2022.
Removed
Cash provided by operating activities during the year ended December 31, 2023, was negatively impacted by $25.8 million non-cash unrealized foreign currency transaction losses compared to a net gain of $15.4 million, during the year ended December 2022, as a result of a 20.5% appreciation of the Colombian Peso against the US Dollar, during 2023.
Removed
We used $76.0 million and $72.6 million in investing activities during the year ended December 31, 2023 and 2022, respectively. The main use of cash in investing activities during 2023, was related to the automation of our architectural system assembly processes and incremental land purchases as further described above in the Capital Resources section.
Removed
The Company’s policy is to reserve for uncollectible accounts based on its best estimate of the amount of probable credit losses in its existing accounts receivable.
Removed
The Company periodically reviews its accounts receivable to determine whether an allowance for doubtful accounts is necessary based on an analysis of past due accounts and other factors that may indicate that the collectability of an account may be in doubt.
Removed
Other factors that the Company considers include its existing contractual obligations, historical payment patterns of its customers and individual customer circumstances, and a review of the local economic environment and its potential impact on the collectability of accounts receivable.
Removed
Account balances are deemed to be uncollectible and are charged off within 90 days of having recorded an allowance and all means of collection have been exhausted and the potential for recovery is considered remote.
Removed
Inventories Inventories of raw materials, which consist primarily of purchased and processed glass, aluminum, vinyl, parts and supplies held for use in the ordinary course of business, are valued at the lower of cost or net realizable value. Cost is determined using a weighted-average method.
Removed
Inventory consisting of certain job specific materials not yet installed (work in process) are valued using the specific identification method. Cost for finished product inventory are recorded and maintained at the lower of cost or market. Cost includes raw materials and direct and applicable indirect manufacturing overheads.
Removed
Also, inventories related to contracts in progress are included within work in process and finished goods and are stated at using the specific identification method and lower of cost or market, respectively, and are expected to turn over in less than one year.
Removed
Reserves for excess or slow-moving raw materials inventories are updated based on historical experience of a variety of factors including sales volume and levels of inventories at the end of the period.
Removed
The Company does not maintain allowances for the lower of cost or market for inventories of finished products as its products are manufactured based on firm orders rather than built-to-stock. 46 Income taxes The Company is subject to income taxes in some jurisdictions. Significant judgment is required when determining the worldwide provision for income taxes.
Removed
The provision for income taxes is determined using the asset and liability approach of accounting for income taxes. Under this approach, deferred taxes represent the future tax consequences expected to occur when the reported amounts of assets and liabilities are recovered or paid.
Removed
The provision for income taxes represents income taxes paid or payable for the current year plus the change in deferred taxes during the year. Deferred taxes result from differences between the financial and tax basis of the Company’s assets and liabilities and are adjusted for changes in tax rates and tax laws when changes are enacted.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

5 edited+0 added−1 removed8 unchanged
Biggest changeThis market risk exposure is net of the effect from interest rate hedging derivative financial instruments further described in the footnotes to the financial statements. 47 We are subject to market risk due to changes in the value of foreign currencies in relation to our reporting currency, the U.S. Dollar.
Biggest changeHowever, following recent repayments we made oin our debt in 2024, only an immaterial portion of our debt is exposed to market risk, net of the effect from interest rate hedging derivative financial instruments further described in the footnotes to the financial statements, and fluctuations in interest rates would not have a significant impact on our cost of financing. 47 We are subject to market risk due to changes in the value of foreign currencies in relation to our reporting currency, the U.S.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. We are exposed to ongoing market risk related to changes in interest rates, foreign currency exchange rates and commodity market prices. A rise in interest rates could negatively affect the cost of financing for a significant portion of our debt with variable interest rates.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. We are exposed to ongoing market risk related to changes in interest rates, foreign currency exchange rates and commodity market prices. Previously, a rise in interest rates could negatively affect the cost of financing for a significant portion of our debt with variable interest rates.
Dollar would result in our annual revenues increasing by $1.3 million and our costs and expenses increasing by approximately $8.1 million, resulting in a $6.8 million decrease to net earnings based on results for the twelve months ended December 31, 2023. Similarly, a significant portion of the monetary assets and liabilities of these subsidiaries are generally denominated in U.S.
Dollar would result in our annual revenues increasing by $1.3 million and our costs and expenses increasing by approximately $9.6 million, resulting in a $8.3 million decrease to net earnings based on results for the twelve months ended December 31, 2024. Similarly, a significant portion of the monetary assets and liabilities of these subsidiaries are generally denominated in U.S.
Dollar denominated monetary liabilities exceed their monetary assets by $37.3 million, such that a 1% devaluation of the Colombian peso will result in a loss of $0.4 million recorded in the Company’s Consolidated Statement of Operations as of December 31, 2023. Additionally, the results of the foreign subsidiaries must be translated into U.S.
Dollar denominated monetary liabilities exceed their monetary assets by $11.6 million, such that a 1% devaluation of the Colombian peso will result in a loss of $0.1 million recorded in the Company’s Consolidated Statement of Operations as of December 31, 2024. Additionally, the results of the foreign subsidiaries must be translated into U.S.
Some of our subsidiaries’ operations are based in Colombia, and primarily transact business in local currency. Approximately 3% of our consolidated revenues and 24% of our costs and expenses are effectively incurred in Colombian pesos, thereby mitigating some of the risk associated with changes in foreign exchange rates.
Dollar. Some of our subsidiaries’ operations are based in Colombia, and primarily transact business in local currency. Approximately 2.8% of our consolidated revenues and 25% of our costs and expenses are effectively incurred in Colombian pesos, thereby mitigating some of the risk associated with changes in foreign exchange rates.
Removed
If interest rates were to increase over the next 12 months by 100 basis points, net earnings would decrease by approximately $0.5 million based the current composition of our indebtedness.

Other TGLS 10-K year-over-year comparisons