What Tecnoglass (TGLS) Said on Its Q3 Earnings Call

Key Points

• Record Q3 revenue rose 19.2% to $310.6 million, prompting Tecnoglass to raise its 2026 revenue outlook to $1.1 billion–$1.14 billion. Adjusted EBITDA fell to $47.7 million, and the company lowered its EBITDA forecast to $210 million–$220 million.
• Profitability was pressured by the Colombian peso’s appreciation, higher aluminum and labor costs, and tariffs; gross margin declined to 34.1% from 42.7% a year earlier. Management expects gross margin to improve sequentially in Q4, with further improvement anticipated in 2027.
• Commercial and multifamily backlog reached a record $1.43 billion, up 13.2% year over year, with revenue in those segments rising 31%. Single-family residential revenue increased 4%, and management plans additional product-specific price increases.

Tecnoglass NYSE: TGLS reported record third-quarter revenue and raised its full-year sales outlook, but higher tariffs, aluminum costs and a stronger Colombian peso weighed on profitability.

The window and glass products manufacturer said revenue rose 19.2% from a year earlier to $310.6 million, driven by growth in both its multifamily and commercial business and its single-family residential operations. Adjusted earnings before interest, taxes, depreciation and amortization fell to $47.7 million from $79.1 million.

Management said the quarter included an $8.4 million non-cash inventory revaluation related to the peso’s appreciation. Excluding that effect, adjusted EBITDA would have been approximately $8.4 million higher, Chief Financial Officer Santiago Giraldo said.

Tecnoglass raised its 2026 revenue outlook to $1.1 billion to $1.14 billion and revised its adjusted EBITDA forecast to $210 million to $220 million. Giraldo said the EBITDA revision mainly reflected the inventory revaluation, while higher-than-expected revenue was helping offset elevated raw material costs and a stronger local currency.

Margins pressured by currency, tariffs and materials

Third-quarter gross margin fell to 34.1% from 42.7% a year earlier. Giraldo said the Colombian peso appreciated approximately 20% year over year and accounted for roughly 580 basis points of the decline, including the inventory revaluation and the effect on peso-denominated costs.

The average all-in U.S. aluminum price rose approximately 52% year over year, with higher costs reaching Tecnoglass on a lag as earlier purchases moved through inventory. Colombian labor costs also rose following a 23% minimum wage increase at the start of the year, and a greater share of installation revenue weighed on the sales mix, Giraldo said.

Selling, general and administrative expenses rose to 23.8% of revenue from 18.2% a year earlier. Section 232 tariffs on finished aluminum windows accounted for approximately $15.5 million of the increase during the first full quarter with the 10% tariff in place, according to Giraldo.

Management expects fourth-quarter gross margin to improve sequentially as pricing actions, lower aluminum costs and a smaller inventory revaluation effect more than offset the strong peso. Responding to an analyst’s estimate of a 38% to 39% fourth-quarter gross margin, Giraldo said that was how the company was modeling it.

Giraldo said the company has secured aluminum at lower prices for the rest of 2026 and into the first quarter of 2027. He expects gross margins to improve further in 2027 as more pricing and automation benefits take effect, though he noted that exchange rates and aluminum prices remain variables. Tecnoglass has not provided formal 2027 guidance.

Commercial backlog reaches a record

Multifamily and commercial revenue rose 31% to $192.4 million as projects progressed into later stages. Backlog ended the quarter at a record $1.43 billion, up 13.2% from a year earlier, while the book-to-bill ratio was 1.2 times, Chief Operating Officer Christian Daes said.

Florida represented roughly three-quarters of backlog, down from more than 85% a year earlier as the company expanded geographically. CEO José Manuel Daes described demand in Florida as strong, while saying Tecnoglass was also pursuing projects in other markets.

The company signed its largest project to date in October. Giraldo said the Florida project was already included in the reported backlog because an affirmed letter of intent had been in place at quarter-end.

Residential pricing and vinyl expansion

Single-family residential revenue rose 4% to $118.1 million. Excluding orders pulled into the second quarter ahead of May pricing actions, revenue in the business increased 17%, Christian Daes said.

José Manuel Daes said Tecnoglass plans to announce another residential price increase. The changes would vary by product, ranging from 3% to as much as 15%, with larger increases on some aluminum-intensive products.

Giraldo said the company continues to expect approximately $15 million in vinyl revenue this year and projects $3 million to $5 million per month next year, depending on market conditions. The vinyl product line is now fully developed, he said, allowing for a broader rollout across different geographies.

Capital expenditures totaled $66.1 million in the quarter, including a land purchase for a potential U.S. facility and payments for capacity and automation investments. Giraldo said Tecnoglass expects to hold off on a facility decision for roughly nine months while it evaluates market conditions, equipment efficiency, staffing needs and potential returns.

The company ended the quarter with approximately $380 million in liquidity and net leverage of 0.9 times. It has no significant debt maturities before the end of 2030, Giraldo said.

About Tecnoglass (NYSE:TGLS)

Tecnoglass Inc NYSE: TGLS is a manufacturer of architectural glass, windows and aluminum products for residential and commercial construction. The company produces impact- and non-impact-resistant windows and doors, insulated and laminated glass, curtain wall systems, storefronts, railings and related architectural components.

Founded in 1994, Tecnoglass is headquartered in Barranquilla, Colombia, where it operates integrated manufacturing facilities serving the building-products market.

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