SAN PEDRO GARZA GARCIA, NUEVO LEON, Mexico, April 28 -- Results for the quarter reflected the weakness prevailing in macroeconomic conditions in the U.S. and Mexico. Additionally, performance during the quarter was affected by the impasse during the pre-war period, as well as a colder than expected winter in the U.S. Furthermore, the 18.3 percent YoY devaluation of the Mexican Peso vs. the U.S. dollar affected the YoY comparison of the Company's results when converted into dollars (even though, in the long-run it benefits its competitive domestic position over imports, as well as exports). In terms of sales, approximately 50 percent of the Company's sales are domestic, and even though 66 percent of them are dollar-linked, there's a lagged-effect in terms of price increases subsequent to devaluation in certain segments. In terms of costs, approximately 75 percent of the Company's cost structure is dollar-linked.
Highlights for the quarter were as follows:
- Consolidated net sales for the quarter declined YoY by 6.2 percent to
US$525 million
- Consolidated EBITDA for the quarter decreased YoY by 21.8 percent to
US$80 million
- Consolidated net loss for the quarter of US$15 million, as a result of
a non-cash exchange loss of US$23 million, and the absence, when
compared to 1Q'02, of the legal tax rate reduction, which benefited
deferred taxes last year
- Consolidated outstanding debt remained flat QoQ. This includes the net
outstanding balance of the proceeds from a medium term note issued on
February 2003 for Ps$1.14 billion as well as the additional restricted
cash associated with a syndicated facility executed at Flat Glass on
1Q'03 and the temporary repurchase of invoices from an off-balance
factoring agreement.
-- Consolidated net sales. Sales were affected by the difficult
macroeconomic conditions during the first quarter aggravated by the
deadlock generated during the pre-war period. The divestiture of
Ampolletas on April of 2002 accounted for 23 percent of the YoY
decline for the quarter. Also, as mentioned, the 18.3 percent YoY
devaluation of the Mexican Peso against the U.S. dollar affected the
YoY comparison. Excluding the currency devaluation effect, sales YoY
would have decreased by 3.3 instead of a 6.2 percent.
Flat Glass' sales declined by 2.0 percent YoY, or US$6 million, mainly
within the U.S. non-residential construction segment and the OEM auto
market. At Glass Containers, sales declined 10.8 percent, or
US$25 million, due to: the divestiture of Ampolletas, which accounted
for 32 percent of the decline; the distortion created by the currency
devaluation effect, and a particularly cold winter in the U.S. that
had a negative impact on beer and soft drink consumption. Glassware'
sales decreased by 11.2 percent, or US$7 million, also affected in
dollar terms from the currency devaluation effect YoY and by lower
sales in the industrial domestic segment.
-- Consolidated EBITDA. Assuming constant exchange rates, consolidated
EBITDA would have decreased by 18.5 instead of 21.8 percent. In
addition, 18 percent of the reduction in EBITDA YoY is attributed to a
strategic decision to reduce inventory levels during 1Q'03 vs. 1Q'02.
For the quarter, EBITDA at Flat Glass declined YoY by 3.1 percent, or
US$1 million, as a result of lower sales. At Glass Containers, EBITDA
declined YoY by 30.6 percent, or US$17 million, as the result of lower
fixed costs absorption and lower sales. Also, the Ampolletas'
divestiture accounted for 10 percent of the decline. At Glassware,
EBITDA declined YoY by 49 percent, or US$5 million, as a result of
lower fixed costs absorption.
-- The Company reported a consolidated net loss of US$15 million, which
includes a non-cash exchange loss of US$23 million, compared with a
non-cash exchange gain of US$21 million on 1Q'02, and a negative
effect on the YoY comparison over taxes of US$12 million resultant of
the absence, when compared to 1Q'02, of the legal tax rate reduction
which benefited deferred taxes last year.
-- On March 31, 2003, consolidated outstanding debt was US$1,576 million.
This included the net outstanding balance of the proceeds from the
Ps$1.14 billion, six-year, bullet, medium term note (MTN*) issued in
the Mexican market on February 13, 2003. It also considers additional
restricted cash associated with the execution of a Syndicated Facility
at Flat Glass during 1Q'03; the net obligation of a U.S. private
placement and the temporary repurchase of invoices from an off-balance
factoring agreement. Net of these items plus the proceeds pending to
be applied from the MTN issue of Ps$1.0 billion made on December 30,
2002, debt would have decreased YoY by 11 percent and remained flat
QoQ.
(*) Certificados Bursatiles
(1) For analysis purposes, all comments and figures discussed in this
announcement are related to amounts in nominal dollars unless
otherwise expressed. Certain amounts may not sum due to rounding.
The consolidated financial results, income statement, and cash flows for the three-month period ended March 31, 2002 and for the last twelve months periods ending March 31, 2003 and March 31, 2002, account for Vitromatic, S.A. de C. V. as a discontinued operation. All figures provided in this announcement are in accordance with Generally Accepted Accounting Principles in Mexico, except otherwise indicated. Dollar figures are in nominal U.S. dollars and are obtained by dividing nominal pesos for each month by the applicable exchange rate as of the end of that month. Certain amounts may not sum due to rounding.
This announcement contains historical information, certain management's expectations and other forward-looking information regarding Vitro, S.A. de C.V. and its Subsidiaries (collectively the "Company"). While the Company believes that these management's expectations and forward-looking statements are based on reasonable assumptions, all such statements reflect the current views of the Company with respect to future events and are subject to certain risks and uncertainties that could cause actual results to differ materially from those contemplated in this report. Many factors could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic, political, governmental and business conditions worldwide and in such markets in which the Company does business, changes in interest rates, changes in inflation rates, changes in exchange rates, the growth or reduction of the markets and segments where the Company sells its products, changes in raw material prices, changes in energy prices, particularly gas, changes in the business strategy, and other factors. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated or expected. The Company does not assume any obligation, to and will not update these forward-looking statements. The assumptions, risks and uncertainties relating to the forward-looking statements in this report include those described in the Company's annual report in form 20-F file with the U.S. Securities and Exchange Commission, and in the Company's other filings with the Mexican Comision Nacional Bancaria y de Valores.
Vitro, S.A. de C.V. , through its subsidiary companies, is one of the world's leading glass producers. Vitro is a major participant in three principal businesses: flat glass, glass containers, and glassware. Its subsidiaries serve multiple product markets, including construction and automotive glass; fiberglass; food and beverage, wine, liquor, cosmetics and pharmaceutical glass containers; glassware for commercial, industrial and retail uses; plastic and aluminum containers. Vitro also produces raw materials, and equipment and capital goods for industrial use. Founded in 1909 in Monterrey, Mexico-based Vitro has joint ventures with major world-class partners and industry leaders that provide its subsidiaries with access to international markets, distribution channels and state-of-the-art technology. Vitro's subsidiaries have facilities and distribution centers in eight countries, located in North, Central and South America, and Europe, and export to more than 70 countries worldwide. For further information, please visit our website at: http://www.vitro.com/
First Quarter 2003 results
Conference Call and Web cast
Tuesday, April 29, 2003
11:30 AM U.S. EDT - 10:30 A.M. U.S. CDT (Monterrey time)
A live web cast of the conference call will be available to investors and the media at http://www.vitro.com/ through Friday, May 30, 2003. For inquiries regarding the conference call, please contact Luca Biondolillo of Breakstone & Ruth via telephone at (646) 536-7012, or via email at Lbiondolillo@breakstoneruth.com.
Consolidated Results Sales
Consolidated net sales for the quarter decreased YoY by 6.2 percent, or US$35 million, to US$525 million. This was the result of a decline in sales at Flat Glass of 2.0 percent or US$6 million; at Glass Containers of 10.8 percent or US$25 million; and at Glassware of 11.2 percent or US$7 million.
As mentioned, the 18.3 percent YoY devaluation of the Mexican Peso vs. the U.S. dollar affected the YoY sales comparison, particularly considering that approximately 17 percent of the Company's sales are peso denominated. Assuming constant exchange rates, sales would have decreased by 3.3 percent YoY. At the same time, it should be noted that in the longer term, a stable fair-valued peso benefits the domestic competitive position of the Company's products over imports.
At Flat Glass sales declined mainly due to continued weakness and uncertainty in the U.S. economy aggravated by the war in Iraq. Particularly affected were the non-residential construction segment, and the OEM auto market in the U.S. These declines were partially offset by increases in the domestic construction segment and the Spanish operations.
Glass Containers' sales decrease reflects the Ampolletas' divestiture during April 2002, which accounted for 32 percent of the decline at the division (23 percent of the overall decline). Sales were also impacted by the currency devaluation effect, and the steeper-than-usual seasonal declines in the beer and soft drink segments that are indirectly exported, as a consequence of the unusually cold winter in the U.S.
Glassware's sales were down at the industrial segment of the domestic market, partially offset by an increase in the domestic retail and wholesalers segments since a weaker peso makes imports less competitive against the Company's domestic products. A decrease in demand in the plastics segment also affected sales.
EBIT and EBITDA
Consolidated EBIT and EBITDA for the quarter decreased YoY by 35.9 and 21.8 percent, respectively, to US$32 million and US$80 million. As with sales, the YoY devaluation of the Mexican Peso against the U.S. dollar produced a temporary negative effect when numbers are measured in dollar terms. Assuming constant exchange rates, consolidated EBITDA would have decreased by 18.5 percent instead of 21.8 percent.
Flat Glass' EBIT and EBITDA decreased YoY by 8.5 and 3.1 percent, or by US$2 and US$1 million. It should be noted that without the effect of the non-recurring charges taken in 4Q'02, EBIT and EBITDA would have risen QoQ by 37.1 and 15.6 percent respectively.
Glass Containers' EBIT and EBITDA decreased YoY by 44.3 and 30.6 percent, or by US$13 and US$17 million, respectively, as a result of the lower fixed costs absorption resulting mainly from lower sales from the beer and soft drink segments. EBIT and EBITDA were also affected by the divestiture of Ampolletas, which contributed 10 percent to the YoY decline.
At Glassware, both EBIT and EBITDA decreased YoY by US$5 million, reflecting the decline in sales thus resulting in lower fixed costs absorption. The plastic segment was affected by increases in the cost of raw materials of oil sub-products.
Consolidated Financing Cost
For the quarter, the Company recorded a consolidated financing cost of US$44 million, compared with a gain of US$4 million for the same quarter of 2002. This was mainly due to non-cash exchange losses of US$23 million for the quarter, compared with a non-cash exchange gain of US$21 million for 1Q'02. This item represented 52 percent of total financing cost, generated by the 2.2 percent depreciation of the Mexican peso against the U.S. dollar over the 2003 January-March period.
The weighted average cost of debt for the quarter was 9.16 percent, higher than the same period of 2002. This was mainly due to the recent, longer-term transactions closed by the Company that improved liquidity but affected costs slightly.
Taxes
During the quarter, the YoY comparison in deferred income taxes was affected by the previous year's one time benefit reduction of the Mexican corporate tax rate from 35 percent to 32 percent as an income. The increase in accrued income tax during the quarter is due to higher taxable gains in some of the Company's foreign subsidiaries that are not consolidated for Mexican tax purposes.
Consolidated Net Income
For the quarter, the Company posted a consolidated net loss of US$15 million, compared with consolidated net income of US$36 million for the same period of 2002. This mainly resulted from higher total financing costs, particularly non-cash items, a decline in operating profits and higher deferred taxes.
Capital Expenditures
During the first quarter, the Company made capital expenditures (CAPEX) of US$38 million, of which 23 percent were invested at Flat Glass, mainly to refurbish one of its furnaces. CAPEX at Glass Containers represented 67 percent of total investments, from which US$21 million were used to refurbish and expand capacity at its Queretaro facility. Glassware' CAPEX represented 10 percent of total investments mainly for maintenance purposes of its OEM and hand made product lines.
Consolidated Financial Position
On March 31, 2003, consolidated outstanding debt was US$1,576 million, compared with US$1,455 million on December 31, 2002. Consolidated outstanding debt rose QoQ by US$121 million, or 8.3 percent, mainly as a result of the issuance of a Ps.1.14 billion, six-year, bullet, medium term note (MTN*) in the Mexican market, on February 13, 2003. Proceeds from this MTN will be used to strengthen the financial position of the Company and align the debt currency structure of the Company with its cash flow generation. Debt as of March 31, 2003 also considers additional restricted cash associated with the execution of a Syndicated Facility at Flat Glass during 1Q'03 and the temporary repurchase of invoices from an off-balance factoring agreement. Net of these proceeds, consolidated outstanding debt would have remained flat QoQ. YoY debt decreased by 11 percent when netting the factors described above, plus the outstanding balance of the proceeds pending to be applied from the MTN issue of Ps$1.0 billion made on December 30, 2002 and the net obligation of a U.S. private placement.
On March 31, 2003, leverage (total debt/EBITDA) was 4.2 times, compared with 3.7 times on December 31, 2002. Net of the effect of the above-mentioned MTN transactions, leverage on March 31, 2003, would have been 3.8 times.
* Certificados Bursatiles
Debt Profile as of March 31, 2003
- Continuing with the Company's strategy of strengthening its financial
profile, the Company's average life of debt increased to 3.4 years
from 3.1 years for the fourth quarter of 2002. Net of the effect of
the February 13, 2003, MTN issue, Vitro's average life of debt would
have been 3.6 years.
- Long-term debt represented 69 percent of total debt as of March 31,
2003. And net of the effect of the February 13, 2003, MTN issue,
long-term debt would have been 75 percent.
- 43 percent of debt maturing in the period April 2003 - March 2004, or
approximately US$214 million, is related to trade finance.
(1) As previously mentioned, the Company purchased an interest rate cap
to protect US$350 million in debt. Including the cap transaction, the
rate profile of the Company's debt was 66 percent fixed rate, 18
percent floating rate plus a fixed spread and 16 percent market
conditions.
Cash Flow(*)
For the quarter, net interest expenses increased YoY as a result of higher gross debt levels and additional costs from derivative transactions. Investments in working capital of US$44 million were affected by the temporary re-purchase of receivables at one of our foreign subsidiaries. Taking out the effect on clients of such re-purchase, investments in working capital would have been US$6 million, considerably lower than in 1Q'02. The decrease was accomplished mainly by reductions in inventories, especially at Glass Containers and Glassware, as well as clients. Dividends paid for the period corresponded to minority interests from joint venture partners in the U.S. and Central America. Cash taxes were lower YoY due to exchange losses. Despite lower YoY EBITDA generation, the Company's net free cash flow generation improved over 1Q'02 taking out the effect of the above-mentioned temporary repurchase of receivables.
(*) Starting with the fourth quarter of 2002, the Company aligned its definition of "Working Capital" to include other current assets and liabilities in addition to the variations in clients, inventories and suppliers. For comparison purposes, working capital for 2002 was adjusted in accordance with this new definition.
Flat Glass
(50 percent of Consolidated Sales)
Sales
Sales for the quarter declined YoY by 2.0 percent, to US$262 million, from US$268 million for the same quarter in 2002 due to the continued weakness of the U.S. economy aggravated by the impasse generated during the pre-war period. Also, the effect of the depreciation of the peso vs. the U.S. dollar, which resulted in lower dollar sales due to the conversion of peso sales.
Particularly affected was the U.S. non-residential construction segment and the OEM auto market. The negative impact of these factors was partially offset by increases in sales in the auto replacement market in Mexico and the U.S. through our own distribution channels, and by a remarkable YoY increase in sales at Vitro Cristalglass in Spain, for which results include the recently acquired Portuguese operation, which accounted for 18 percent of the increase.
Volumes were down mainly in the auto segment. Prices remained constant in dollar terms.
EBIT and EBITDA
Consolidated EBIT for the quarter was US$23 million, representing a YoY decline of 8.5 percent. This was mainly due to the decline in sales.
Quarter over quarter, excluding the effect of the non-recurring charges of US$9 million taken in 4Q'02, EBIT would have risen by 37.1 percent.
EBITDA for the quarter was US$40 million, reflecting a 3.1 percent YoY decrease, as the result of factors discussed above.
Glass Containers
(39 percent of Consolidated Sales)
Sales
Consolidated sales for the quarter declined YoY by 10.8 percent to US$207 million, from US$232 million. Ampolletas' divestiture during April 2002, accounted for 32 percent of the decline at the division. Sales were also affected by declines in the domestic beer, and to a lesser extent, soft drink markets. Sales to these segments in the domestic market become actually indirect exports to the U.S., where demand for these products during the quarter was lower than expected due to a colder than usual winter. On the other hand, sales to the wine & liquor segment continued to rise. Although prices have remained stable in constant peso terms, the YoY effect of the devaluation has affected the business' average prices when measured in U.S. dollars.
The Central American operations posted a strong quarter, reflecting a YoY increase of 3.5 percent.
Exports increased YoY by 1.2 percent to US$56 million as an improved sales mix and price increases more than compensated for the decline in volumes experienced for the quarter.
EBIT and EBITDA
EBIT for the quarter decreased YoY by 44 percent to US$16 million, mainly due to the sales factors described above which resulted in lower capacity utilization and lower fixed costs absorption.
EBITDA for the quarter decreased YoY by 30.6 percent to US$37 million, mainly due to the factors discussed above.
Glassware
(10 percent of Consolidated Sales)
Sales
Sales for the quarter declined YoY by 11.2 percent to US$52 million, mainly as a result of lower sales to the domestic industrial market. The peso devaluation during the quarter favored sales to the domestic retail and wholesale segments, as imports became less attractive. However, these increases were not enough to offset lower sales to the industrial segment. Exports were affected by continued weak consumer confidence.
Glass sales accounted for approximately 79 percent of total sales at the business unit.
Sales at the plastic subsidiaries declined YoY by 10 percent, mainly due to lower sales within the plastic plate, cup, and cutlery segment, especially with retailers.
EBIT and EBITDA
As a result of lower sales and increases in cash flow generation, fixed costs absorption was reduced resulting in negative EBIT for the quarter. EBIT at the plastic segment was affected by lower fixed costs absorption as a result of lower sales, as well as a YoY increase in the cost of raw materials, particularly of oil sub-products. Additionally, pricing pressures in the plastic plate, cup, and cutlery segment impacted margins as a result of over capacity in the sector.
EBITDA for the quarter was US$6 million, reflecting a YoY decrease of 49 percent, resulting from the factors discussed above.
Key Developments Debt Refinancing
On February 13, 2003, the Company issued a MTN in the Mexican market for Ps.1.14 billion, six-years, bullet, maturing on February 5, 2009. As of the end of 1Q'03, most of the proceeds from this issue, along with the other MTN issued on December 30, 2002 are being temporarily invested, though they will be used to extend the average life of Vitro's debt profile at the holding company level by replacing short-term debt and current maturities of long-term debt.
The Company closed a US$201 million syndicated loan facility within Flat Glass to improve the business unit's debt profile. Considering the final structure of the facility, its average life is 3.1 years with an average rate of Libor + 2.28 percent. Proceeds were mostly used to pay down short-term maturities and some long-term debt with less favorable financial conditions.
After the closing of these transactions, the average life of the Company's consolidated net outstanding debt improved, as of March 31, 2003 to 3.6 years, from 3.4 years with long-term debt accounting for 75 percent of total debt.
Table 1: Total Sales
Table 1
Total Consolidated Sales
(Millions)
YoY% YoY%
1Q'03 1Q'02 Change LTM'03 LTM'02 Change
Total Consolidated Sales 525 560 (6.2) 2,308 2,386 (3.3)
Flat Glass 262 268 (2.0) 1,093 1,129 (3.1)
Glass Containers 207 232 (10.8) 951 981 (3.0)
Glassware 52 59 (11.2) 250 267 (6.6)
-- --
Domestic Sales 240 273 (12.1) 1,097 1,172 (6.4)
Export Sales 135 141 (4.4) 580 586 (1.0)
Foreign Subsidiaries 151 147 2.9 632 628 0.7
% Foreign Currency Sales*/
Total Sales 54.4% 51.3% 3.1 pp 53.0% 50.9% 2 pp
% Export Sales/Total Sales 25.7% 25.2% 0.5 pp 25.1% 24.6% 0.5 pp
* Exports + Foreign Subsidiaries
Table 2: EBIT and EBITDA
Table 2
EBIT and EBITDA
(Millions)
YoY% YoY%
1Q'03 1Q'02 Change LTM'03 LTM'02 Change
Consolidated EBIT 32 50 (35.9) 176 215 (17.9)
Margin 6.1% 8.9% -2.8 pp 7.6% 9.0% -1.4 pp
Flat Glass 23 25 (8.5) 80 122 (34.5)
Glass Containers 16 29 (44.3) 105 97 8.9
Glassware (1) 4 -- 21 30 (31.3)
Consolidated EBITDA 80 103 (21.8) 381 429 (11.2)
Margin 15.3% 18.4% -3.1 pp 16.5% 18.0% -1.5 pp
Flat Glass 40 41 (3.1) 149 186 (20.0)
Glass Containers 37 54 (30.6) 197 200 (1.4)
Glassware 6 11 (49.1) 48 57 (16.1)
Table 3: Total Cost of Financing
Table 3
Total Financing Cost
(Millions)
YoY% YoY%
1Q'03 1Q'02 Change LTM'03 LTM'02 Change
Nominal Dollars
Interest Expense 33 31 5.7 131 139 (5.6)
Interest Income (3) (0) 840.4 (8) (2) 270.9
Foreign Exchange Loss (Gain) 23 (21) -- 196 (63) --
Monetary Position (Gain) (15) (22) (31.0) (71) (69) 2.3
Other Financial Expenses (Net)* 6 8 (21.7) 24 33 (28.1)
Total Financing Cost (gain) 44 (4) -- 271 37 636.1
* Net of non related interest products.
Table 4: Taxes and Profit Sharing to Workers
Table 4
Taxes and Profit Sharing to Workers
(Millions)
YoY% YoY%
1Q'03 1Q'02 Change LTM'03 LTM'02 Change
Nominal Dollars
Accrued Income Tax 9 7 18.0 37 26 41.3
Deferred Income Tax (10) (21) (54.0) (74) (22) 243.2
Total Income Tax (1) (14) (93.0) (37) 5 --
Profit Sharing to Workers 2 3 (18.5) 5 5 1.5
Total Taxes and PSW 1 (11) -- (32) 10 --
Table 5
Debt Indicators
(Million dollars; except as indicated)
1Q'03 4Q'02 3Q'02 2Q'02 1Q'02
Interest Coverage
(EBITDA/Int. Exp.) (Times) 2.9 3.1 3.4 3.2 3.1
Leverage
(Total Debt/EBITDA) (Times) 4.2 3.7 3.4 3.8 3.3
Total Debt 1,576 1,455 1,370 1,535 1,513
Short-Term Debt(1) 495 458 492 612 647
Long-Term Debt 1,080 997 878 923 865
Currency Mix (%)
dlls/Pesos/UDI's 57/43/0 66/34/0 72/27/1 88/11/1 95/4/1
Weighted Average
Cost of Debt (%) 9.2 8.8 9.0 8.6 8.6
(1) Short term debt includes current maturities of long-term debt.
Table 6: Cash Flow Analysis
Table 6
Cash Flow Analysis(1)
(Millions)
YoY% YoY%
1Q'03 1Q'02 Change LTM'03 LTM'02 Change
EBITDA 80 103 (21.8) 381 429 (11.2)
(-) Net Interest Expense(2) 29 25 14.1 155 172 (9.9)
(-) Capex 38 23 63.4 115 93 24.6
(+/-) Working Capital(3) 44 63 (29.8) 65 (85) --
(-) Dividends 6 12 (49.7) 29 30 (4.9)
(-) Cash Taxes paid 7 17 (61.1) 11 39 (73.0)
Net Free Cash Flow (43) (38) 13.7 7 181 (96.2)
(1) This statement is a Cash Flow statement and it does not represent
a Statement of Changes in Financial Position according with the
Mexican GAAP
(2) Includes other financial expenses and products.
(3) It's being reexpresed to include; Clients, Inventories, suppliers
and other current assets and liabilities
Table 7: Flat Glass
Table 7
Flat Glass
(Millions)
YoY% YoY%
1Q'03 1Q'02 Change LTM'03 LTM'02 Change
Consolidated Net sales 262 268 (2.0) 1,093 1,129 (3.1)
Domestic Sales 77 80 (2.9) 318 350 (9.2)
Export Sales 62 69 (9.6) 265 264 0.7
Foreign Subsidiaries 123 119 2.9 509 515 (1.0)
EBIT 23 25 (8.5) 80 122 (34.5)
EBITDA 40 41 (3.1) 149 186 (20.0)
EBIT Margin 8.7% 9.3% 0 pp 7.3% 10.7% -3.4 pp
EBITDA Margin 15.3% 15.4% -0.1 pp 13.6% 16.2% -2.6 pp
Volumes
Flat Glass (Thousands
of Metric Tons) 152 163 (6.7) 656 658 (0.2)
Fiber Glass (Thousands
of Metric Tons) 9 8 15.3 36 31 15.5
Capacity utilization
Flat Glass furnaces 92%
Flat Glass auto segment 78%
Fiber Glass 90%
Table 8: Glass Containers
Table 8
Glass Containers
(Millions)
YoY% YoY%
1Q'03 1Q'02 Change LTM'03 LTM'02 Change
Consolidated Net sales 207 232 (10.8) 951 981 (3.0)
Domestic Sales 123 149 (17.8) 593 622 (4.8)
Export Sales 56 56 1.2 236 246 (3.9)
Foreign Subsidiaries 28 27 2.9 122 113 8.3
EBIT 16 29 (44.3) 105 97 8.9
EBITDA 37 54 (30.6) 197 200 (1.4)
EBIT Margin 7.7% 12.3% -4.6 pp 11.1% 9.8% 1.3 pp
EBITDA Margin 18.1% 23.2% -5.1 pp 20.8% 20.4% 0.4 pp
Glass Containers
Domestic (Millions of
Units) 866 940 (7.8) 4,042 3,789 6.7
Exports (Millions of
Units 241 295 (18.2) 1,009 1,126 (10.4)
Total 1,108 1,235 (10.3) 5,051 4,914 2.8
Capacity utilization
(furnaces) 78%
Capacity utilization
(production lines) 82%
Soda Ash
(Thousands Tons) 134.5 129.5 3.9 548.8 545.8 0.6
Capacity utilization 98%
Aluminium Cans (Million
of Units) 210.6 192.3 9.5 934.9 916.5 2.0
Capacity utilization 79%
Table 9: Glassware
Table 9
Glassware
(Millions)
YoY% YoY%
1Q'03 1Q'02 Change LTM'03 LTM'02 Change
Consolidated Net sales 52 59 (11.2) 250 267 (6.6)
Domestic Sales 36 42 (15.1) 172 191 (10.0)
Export Sales 16 17 (1.4) 78 77 2.1
EBIT (1) 4 -- 21 30 (31.3)
EBITDA 6 11 (49.1) 48 57 (16.1)
EBIT Margin -1.9% 6.3% -8.2 pp 8.4% 11.4% -3 pp
EBITDA Margin 10.6% 18.5% -7.9 pp 19.2% 21.4% -2.2 pp
Sales mix glassware
products
Retail 30.0% 27.0% 3 pp 28.9% 23.2% 5.7 pp
Wholesaler 30.0% 26.0% 4 pp 29.0% 27.1% 1.9 pp
Industrial 34.0% 41.0% -6 pp 36.8% 44.9% -8.1 pp
OEM 6.0% 5.0% 1 pp 5.3% 4.8% 0.5 pp
Capacity utilization 50.0%
Sales mix plastic products
Industrial 82.8% 80.8% 2.02 pp 86.5% 83.0% 10 pp
Retail 17.2% 19.2% -2 pp 13.5% 17.0% -3.5 pp
VITRO, S.A. DE C.V. AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS
AS OF MARCH 31, 2003 (IN MILLIONS)
First Quarter
INCOME STATEMENT Constant Pesos Nominal Dollars
2003 2002 % Var. 2003 2002 % Var.
Consolidated Net Sales 5,673 5,665 0.1 525 560 (6.2)
Cost of Sales 4,185 3,976 5.3 387 395 (1.9)
Gross Income 1,487 1,689 (11.9) 138 166 (16.5)
SG&A Expenses 1,147 1,180 (2.9) 106 116 (8.1)
Operating Income 341 508 (33.0) 32 50 (35.9)
Interest Expense 435 380 14.5 40 39 2.1
Interest Income 41 4 962.0 4 0 812.1
Exchange Loss (Gain) 262 (202) -- 23 (21) --
Gain from Monet. Position 162 209 (22.5) 15 22 (31.0)
Total Financing Cost 494 (35) -- 44 (4) --
Other Income (14) (323) (95.6) (1) (34) (96.0)
Share in Net Income of
Non-Consol. Assoc.
Companies (0) (0) (4.9) (0) (0) (16.1)
Inc. (loss) bef. Tax & PSW (167) 221 -- (13) 20 --
Income Tax and PSW 7 (102) -- 1 (11) --
Net Inc. (loss) Cont. Opns. (175) 323 -- (15) 31 --
Income (loss) of Discont.
Oper. -- 51 -- -- 5 --
Extraordinary Items, Net -- --
Net Income (Loss) (175) 374 -- (15) 36 --
Net Income (loss) of Maj.
Int. (221) 202 -- (19) 19 --
Net Income (loss) of Min.
Int. 47 172 (73.0) 5 17 (73.4)
LTM
INCOME STATEMENT Constant Pesos Nominal Dollars
2003 2002 % Var. 2003 2002 % Var.
Consolidated Net Sales 24,311 24,587 (1.1) 2,308 2,386 (3.3)
Cost of Sales 17,475 17,378 0.6 1,659 1,688 (1.7)
Gross Income 6,836 7,209 (5.2) 649 697 (7.0)
SG&A Expenses 4,985 5,001 (0.3) 472 483 (2.2)
Operating Income 1,850 2,208 (16.2) 176 215 (17.9)
Interest Expense 1,705 1,717 (0.7) 163 172 (5.3)
Interest Income 175 24 614.8 16 2 566.0
Exchange Loss (Gain) 2,027 (612) -- 196 (63) --
Gain from Monet. Position 740 692 7.0 71 69 2.3
Total Financing Cost 2,817 388 625.5 271 37 636.0
Other Income 356 (1,112) -- 35 (112) --
Share in Net Income of
Non-Consol. Assoc.
Companies (0) 10 -- (0) 1 --
Inc. (loss) bef. Tax & PSW (610) 717 -- (59) 67 --
Income Tax and PSW (325) 164 -- (32) 15 --
Net Inc. (loss) Cont. Opns. (285) 553 -- (27) 52 --
Income (loss)of
Discont. Oper. (171) 168 -- (17) 17 --
Extraordinary Items, Net -- --
Net Income (Loss) (456) 721 -- (44) 69 --
Net Income (loss) of
Maj. Int. (464) 217 -- (44) 20 --
Net Income (loss) of
Min. Int. 7 504 (98.6) 0 49 (99.9)
VITRO, S.A. DE C.V. AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS
AS OF MARCH 31, 2003 (IN MILLIONS)
Constant Pesos Nominal Dollars
BALANCE SHEET 2003 2002 % Var. 2003 2002 % Var.
Cash & Cash
Equivalents 2,792 872 220.3 262 86 203.4
Trade Receivables 2,367 2,051 15.4 222 207 7.2
Inventories 3,743 3,525 6.2 351 353 (0.6)
Other Current Assets 1,184 1,262 (6.2) 111 127 (12.4)
Current Assets from
Disc. Operations -- 1,032 -- -- 107 --
Total Current Assets 10,086 8,742 15.4 945 880 7.4
Inv. in Uncons. Subs. -- -- -- -- -- --
Prop., Plant & Equipment 18,843 19,040 (1.0) 1,766 1,973 (10.5)
Deferred Assets 1,878 1,829 2.6 176 183 (3.7)
LT Assets from Disc.
Operations -- 3,170 -- -- 333 --
Other Long-Term Assets 811 561 44.6 76 58 30.9
Total Assets 31,618 33,343 (5.2) 2,963 3,427 (13.5)
Short-Term & Curr. Debt 5,287 6,180 (14.5) 495 647 (23.5)
Trade Payables 2,026 2,375 (14.7) 190 245 (22.6)
Other Current Liabilities 2,500 2,023 23.6 234 202 15.7
Current Liabilities
from Disc. Operations -- 1,555 -- -- 160 --
Total Curr. Liab. 9,813 12,134 (19.1) 920 1,255 (26.7)
Long-Term Debt 11,528 8,291 39.0 1,080 865 24.8
Other LT Liabilities 1,917 2,393 (19.9) 180 247 (27.2)
LT Liabilities from
Disc. Operations -- 669 -- -- 70 --
Total Liabilities 23,257 23,486 (1.0) 2,180 2,437 (10.6)
Restated Capital Stock 7,143 7,143 -- 669 669 --
Retained Earnings (1,445) (964) 49.9 (135) (66) 104.5
Minority Interest 2,663 3,677 (27.6) 250 386 (35.4)
Total Shar. Equity 8,361 9,856 (15.2) 784 990 (20.8)
VITRO, S.A. DE C.V. AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS
AS OF MARCH 31, 2003 (IN MILLIONS)
FINANCIAL INDICATORS 1Q'03 1Q'02
Debt/EBITDA (LTM, times) 4.2 3.3
EBITDA/Int. Exp. (LTM, times) 2.9 3.1
Debt/Firm Value (times) 0.7 0.6
Debt/Equity (times) 2.0 1.5
Total Liab./Stockh. Equity (times) 2.8 2.4
Curr. Assets/Curr. Liab. (times) 1.0 0.7
Sales/Assets (times) 0.8 0.8
EPS (Ps$) * (0.8) 0.7
EPADR (US$) * (0.2) 0.2
* Based on the weighted average
OTHER DATA
# Shares Issued (thousands) 324,000 324,000
Shares Outstanding at the end of period
(thousands) 275,973 273,706
Employees 26,332 27,825
VITRO, S.A. DE C.V. AND SUBSIDIARIES
SEGMENTED INFORMATION
AS OF MARCH 31, 2003 (IN MILLIONS)
First Quarter
Constant Pesos Nominal Dollars
2003 2002 % 2003 2002 %
FLAT GLASS
Net Sales 2,849 2,775 2.7% 264 271 -2.6%
Interd. Sales 22 34 -35.2% 2 4 -42.5%
Con. N. Sales 2,827 2,741 3.1% 262 268 -2.0%
Expts. 681 664 2.4% 62 69 -9.6%
EBIT 245 258 -4.8% 23 25 -8.5%
Margin (1) 8.7% 9.4% 8.7% 9.3%
EBITDA 432 418 3.4% 40 41 -3.1%
Margin (1) 15.3% 15.2% 15.3% 15.4%
Flat Glass Volumes
(Thousand Tons)
Const + Auto 152 163 -6.7%
Fiberglass
(Thousand Tons) 9.3 8.0 15.3%
GLASS CONTAINERS
Net Sales 2,254 2,339 -3.6% 209 233 -10.5%
Interd. Sales 17 8 117.2% 2 1 93.6%
Con. N. Sales 2,236 2,331 -4.0% 207 232 -10.8%
Expts. 600 599 0.2% 56 56 1.2%
EBIT 170 284 -40.1% 16 29 -44.3%
Margin (1) 7.6% 12.2% 7.7% 12.3%
EBITDA 404 530 -23.8% 37 54 -30.6%
Margin (1) 18.0% 22.7% 18.1% 23.2%
Glass containers
volumes (MM Pieces)
Domestic 866.3 939.7 -7.8%
Exports 241.3 295.1 -18.2%
Total:Dom.+Exp. 1,107.6 1,234.8 -10.3%
Soda Ash (Thousand Tons) 134.5 129.5 3.9%
Aluminum Cans (MM Pieces) 210.6 192.3 9.5%
GLASSWARE
Net Sales 569 585 -2.7% 52 60 -12.0%
Interd. Sales 5 10 -53.6% 0 1 -58.9%
Con. N. Sales 565 575 -1.8% 52 59 -11.2%
Expts. 177 170 4.2% 16 17 -1.4%
EBIT (12) 37 -- (1) 4 --
Margin (1) -2.1% 6.4% -1.9% 6.3%
EBITDA 59 106 -43.9% 6 11 -49.1%
Margin (1) 10.5% 18.4% 10.6% 18.5%
GLASSWARE (Sales Mix %)
Retail 30.0% 27.0%
Wholesale 30.0% 26.0%
Industrial 34.0% 41.0%
OEM 6.0% 5.0%
PLASTICS (Sales Mix %)
Retail 82.8% 80.8%
Industrial 17.2% 19.2%
CONSOLIDATED (2)
Net Sales 5,754 5,730 0.4% 533 567 -6.0%
Interd. Sales 81 66 23.6% 7 7 10.0%
Con. N. Sales 5,673 5,665 0.1% 525 560 -6.2%
Expts. 1,458 1,434 1.7% 135 141 -4.4%
EBIT 341 508 -33.0% 32 50 -35.9%
Margin (1) 6.0% 9.0% 6.1% 8.9%
EBITDA 868 1,024 -15.2% 80 103 -21.8%
Margin (1) 15.3% 18.1% 15.3% 18.4%
(1) EBIT and EBITDA Margins consider Consolidated Net Sales.
(2) Includes corporate companies and other's sales and EBIT.
VITRO, S.A. DE C.V. AND SUBSIDIARIES
SEGMENTED INFORMATION
AS OF MARCH 31, 2003 (IN MILLIONS)
LTM
Constant Pesos Nominal Dollars
2003 2002 % 2003 2002 %
FLAT GLASS
Net Sales 11,653 11,845 -1.6% 1,103 1,139 -3.2%
Interd. Sales 97 105 -7.3% 9 11 -11.7%
Con. N. Sales 11,556 11,741 -1.6% 1,093 1,129 -3.1%
Expts. 2,768 2,615 5.9% 265 264 0.7%
EBIT 848 1,256 -32.5% 80 122 -34.5%
Margin (1) 7.3% 10.7% 7.3% 10.8%
EBITDA 1,571 1,902 -17.4% 149 186 -20.0%
Margin (1) 13.6% 16.2% 13.6% 16.5%
Flat Glass Volumes
(Thousand Tons)
Const + Auto 656 658 -0.2%
Fiberglass (Thousand Tons) 36.4 31.5 15.5%
GLASS CONTAINERS
Net Sales 10,081 10,118 -0.4% 959 987 -2.8%
Interd. Sales 79 55 44.6% 8 6 37.4%
Con. N. Sales 10,002 10,063 -0.6% 951 981 -3.0%
Expts. 2,527 2,655 -4.8% 236 246 -3.9%
EBIT 1,095 981 11.6% 105 97 8.9%
Margin (1) 10.9% 9.7% 11.1% 9.8%
EBITDA 2,060 2,020 2.0% 197 200 -1.4%
Margin (1) 20.6% 20.1% 20.8% 20.4%
Glass containers
volumes (MM Pieces)
Domestic 4,041.8 3,788.6 6.7%
Exports 1,009.1 1,125.8 -10.4%
Total:Dom.+Exp. 5,051.0 4,914.3 2.8%
Soda Ash (Thousand Tons) 548.8 545.8 0.6%
Aluminum Cans (MM Pieces) 934.9 916.5 2.0%
GLASSWARE
Net Sales 2,639 2,737 -3.6% 252 271 -7.1%
Interd. Sales 24 41 -40.8% 2 4 -43.0%
Con. N. Sales 2,614 2,696 -3.0% 250 267 -6.6%
Expts. 820 799 2.6% 78 77 2.1%
EBIT 216 311 -30.6% 21 30 -31.3%
Margin (1) 8.3% 11.5% 8.4% 11.4%
EBITDA 498 576 -13.5% 48 57 -16.1%
Margin (1) 19.1% 21.4% 19.2% 21.4%
GLASSWARE (Sales Mix %)
Retail 28.9% 23.2%
Wholesale 29.0% 27.1%
Industrial 36.8% 44.9%
OEM 5.3% 4.8%
PLASTICS (Sales Mix %)
Retail 86.5% 83.0%
Industrial 13.5% 17.0%
CONSOLIDATED (2)
Net Sales 24,618 24,838 -0.9% 2,330 2,411 -3.3%
Interd. Sales 307 251 22.3% 23 25 -10.6%
Con. N. Sales 24,311 24,587 -1.1% 2,308 2,386 -3.3%
Expts. 6,115 6,068 0.8% 580 586 -1.0%
EBIT 1,850 2,208 -16.2% 176 215 -17.9%
Margin (1) 7.6% 9.0% 7.6% 9.0%
EBITDA 3,988 4,353 -8.4% 381 429 -11.2%
Margin (1) 16.4% 17.7% 16.5% 18.0%
(1) EBIT and EBITDA Margins consider Consolidated Net Sales.
(2) Includes corporate companies and other's sales and EBIT.