Investor Presentaiton
October 12, 2021
CERAMIC TILES SHOULD NOT BE SEEN ENTIRELY AS A CONSTRUCTION PLAY.
Over the past ten years, the sales of ceramic tiles in Mexico have outperformed the GDP growth of both the country and the construction sector, because of the following dynamics:
• -80% of the demand for ceramic tiles is attributed to home remodeling.
• Under-penetrated market, with -60% of Mexican dwellings having a concrete or dirt floor (~63% in 2010).
High barriers of entry (distribution and branding) that give strong pricing power, enabling the industry to increase prices (at least) in line with inflation.
The following chart shows how the three largest companies in Mexico (LAMOSA, CERAMIC and VITROMEX) have replicated the industry's outperformance.
Mexico Ceramic Tile Sales vs. National and Construction GDP Growth
-YOY Growth
210
200
190
180
170
160
150
140
130
120
110
100
90
80
80
70
10
2009
LAMOSA
INTERCERAMIC
VITROMEX
National GDP
Construction GDP
-
GBM
2019
2020
LAMOSA/CERAMIC: THE ROAD TO GROWTH IS PAVED WITH TILES. | 13
2010
2011
2012
2013
2014
2015
2016
2017
2018
Source: GBM Research with companies' dataView entire presentation