Investor Presentaiton
October 12, 2021
LAMOSA: INVESTMENT THESIS
STRONG FCF AND HEALTHY BALANCE SHEET TO ALLOW FOR FURTHER GROWTH OPPORTUNITIES
GBM
A strong free cash flow and healthy balance sheet should allow LAMOSA to keep pursuing organic investments while it continues to consolidate the industry via inorganic opportunities. Speaking of M&A,
the global industry is highly fragmented and LAMOSA is the second-largest player, with a global market share of ~2%. Against that backdrop, given that the company has reached a significant scale, both in
footprint and free cash flow generation, it is in a good position to smoothly integrate small to medium-sized assets to its footprint without compromising its financial position-as it happened in 2020 and 2021.
Therefore, the management's ability to maintain a disciplined approach towards M&A and cherry-pick quality assets and brands is still a critical part of the company's growth story going forward.
Averaging -40% OFCF conversion rates over the last 10 years
OFCF* and Conversion Rate
-Figures in MXN Billion
96%
91%
66%
60%
36%
35%
63%
59%
50%
48%
51%
53%
40%
32%
34%
3.9
3.5
3.5
3.6
3.5
3.7
18%
1.7
1.5
1.1
1.2
1.2
1.1
1.2
0.6
0.7
0.6
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021e
2022e
2023e
2024e
2025e
OFCF*
OFCF Conversion Ratio al
Net Debt and Net Leverage Ratio
-Figures in MXN Billion
Healthy balance sheet despite recent acquisitions
SAN LORENZO
3.9x
↑
euro
Roca
cerámica
3.6x
3.0x
2.5x
2.4x
2.3x
2.3x
2.2x
2.0x
1.5x
1.1x
1.0x
0.7x
0.5x
9.3
7.9
7.9
7.1
7.2
0.1x
-0.3x
7.0
4.6
5.5
6.3
3.5
4.8
4.5
4.4
3.6
1.0
(1.8)
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021e
2022e
2023e
2024e
2025e
Net Debt
Net Debt to EBITDA
*OFCF: Free cash flow before strategic CAPEX, mostly derived from acquisitions
a) OFCF Conversion Ratio: Operating Free Cash Flow/EBITDA
Source: GBM Research
LAMOSA/CERAMIC: THE ROAD TO GROWTH IS PAVED WITH TILES. | 35View entire presentation