The global economy ended 2014 with 3.4% growth. The United States and China, the two major reference markets, have grown at a rate of 2.4% and 7.4% respectively, while emerging and developing market economies have continued to contribute more than two-thirds of global growth, although at a slower pace than in the past. These positive data are intermingled with certain risks, both economic and geopolitical, which call for maximum caution in analyzing recovery.

The Eurozone still advances slowly, backed by falling oil prices, further relaxation of monetary policies, the more neutral stance of fiscal policy and the recent depreciation of the euro against the dollar, although strong uncertainties remain with regard to the labour market, low inflation and the effects of monetary policy. Moreover, emerging economies have performed very unevenly: China is growing strongly, although at lower rates than in the past; India has implemented rigorous macroeconomic policies and has maintained its growth rate at 7.2%; and Brazil and Russia have witnessed a sharp slowdown, with growth rates of 0.1% and 0.6% respectively.

Finally, it is worth noting the sharp appreciation of the euro against other world currencies, especially in emerging countries, with a great influence on the Group’s operations. This assessment is a result of lower growth in these economies due to higher inflation rates, political and social uncertainty in some cases, and strong outflow of speculative capital from these emerging economies and their return to the US, given the possible change in monetary policy by US authorities.

In this still uncertain economic context, the Group’s most relevant economic figures in the year 2014 are as follows:

  • Consolidated turnover was 1,646 million euros, representing an increase of 4.7% with respect to the previous year.

  • Consolidated EBITDA (the earnings before interest, tax, depreciations and amortizations) was 221 million euros, accounting for almost 13.4% of turnover

  • Consolidated net income — after tax — attributable to the Group reflects a profit of 53 million euros, an amount similar to the previous year.

  • The Group’s shareholders’ equity was 1,216 million euros at year-end 2014, and net financial debt at December 31 2014 stood at 378 million euros.

  • The year’s investments in tangible and intangible fixed assets were 122 million euros compared to 80 million euros in 2013. The key investments focused on the installation of a new line in Brazil to manufacture ceramic tile featuring technical porcelain technology, and expansions in India, Malaysia and China aimed at meeting the growth in demand in their own markets. The various acquisitions that have taken place are also worth noting. Two of them are aimed at increasing our footprint in the markets of Northern Europe and Australia, one involved the acquisition of a supplier in India and, finally, we expanded our shareholding in two companies located in Spain and Egypt, which has involved taking control and management of both.

Evolución de la cifra de negocio
Impacto del tipo de cambio en el volumen de negocio


The Group’s turnover for 2014 was 1,646 million euros, representing an increase of 4.7% with respect to the previous year. This has been conditioned again by the significant overall depreciation in relation to the euro experienced by most currencies with which the Group operates (the organization’s accounting consolidation currency). This has been especially the case in emerging countries where the Group’s operational volume is very high, such as the Russian ruble (-16.9%), the Brazilian real (-8%) and the Indian rupee (-4%). Excluding the effect of exchange rates on the consolidation of foreign operations in euros, turnover would have grown by 9.8% to 1,726 million in local currency.

It is important to note that, together with BRIC countries (Brazil, Russia, India and China), the vast majority of the markets in which the Group is present have also contributed to organic growth in turnover. European markets have posted very noticeable growth (Spain, Switzerland, United Kingdom, Germany, Czech Republic and Portugal), not to mention Morocco, Malaysia and Egypt. Worth noting is the increase of 12.1% compared to 2013 which has been seen in Spain — the Group’s second market in turnover — after seven years of uninterrupted sales falls. Improving operations in Spain is due to both macroeconomic reasons and, especially, to the actions that the Group has undertaken to grow in product categories other than sanitary ware (faucets, furniture and accessories), which have seen a significant increase in demand.

Evolución de la cifra de negocio
Impacto del tipo de cambio en el volumen de negocio


EBITDA totaled 221 million euros and the net result reflects a profit of 53 million euros, similar to 2013 results. This consolidates the turnaround which began the previous year. Depreciation against the euro of most of the major currencies with which the Group operates has also had a negative impact on EBITDA and net income in euros. Not taking into account this negative exchange rate impact (at 2013 exchange rates), EBITDA for 2014 would have stood at 235 million euros.t should also be noted that the year has been shrouded in an environment of economic uncertainty in many Western and emerging countries, coupled with the constant pressures to reduce retail prices in most markets. These negative aspects were offset internally with a production cost containment and reduction policy — especially in markets enjoying significant volume growth —, improved logistics efficiency and strict structure cost control.

Finally, it should be noted that the income tax figure for 2014 includes a deferred tax adjustment of approximately 8 million euros, resulting from the corporation tax rate reduction in Spain (from 30% to 28% in 2015 , and down to 25% in 2016), which has been taken into account by all Spanish companies.

Evolución de los resultados
Evolución tipo de cambio vs euros


Investments and Financial Structure

Investments in tangible and intangible fixed assets were 122 million euros this year, compared to 80 million in 2013 and 108 million in 2012. Investments focused mainly on projects to expand production capacity in markets where significant increases in sales volume are recorded, mainly India, Malaysia and China. Thanks to investments made, the Group has a productive capacity that can meet growing domestic demand in these emerging economies. Significant investments were made in Brazil and a new production line with technical porcelain technology was installed at the Campo Largo ceramic tile factory. The 2014 financial year has also seen the consolidation of the various strategic investments made in previous years and operations in Spain after the reconfiguration of the industrial map carried out in recent years.

It is also worth noting that, after two years without any acquisitions, the company’s international expansion has continued in 2014 through various operations totalling 50 million euros. The company Gemini Industries Pty Ltd has been acquired in Australia with the aim of expanding the Group’s commercial presence and market share. In Norway we have acquired the rights to sell bathroom products made by VVS Marketing, a long-standing and considerable prestigious brand in this market. In India we have bought, through the company Roca Bathroom Products Pvt Ltd, 74% stake of the company Espiem Plastics Ltd., which manufactures plastic products for the bathroom. The Group now owns 100% of its share capital. Finally, in 2014 we also acquired the remaining 50% stake in the Spanish company Industrias Cosmic, S.A. and its subsidiary located in China. We also acquired 25% (minus one share) more of the 50% already owned in the Egyptian company National Industrial & Trading Co. “Gravena S.A.E.” and their subsidiary companies, thereby taking control and management of both groups.

Regarding the financial structure at year-end 2014, three significant points can be made:

  • Net debt has increased by 18 million euros, reaching 378 million euros at December 31, 2014. This increase is due to the investments and acquisitions plan undertaken by the Group during the year.

  • The early renewal of the syndicated financing long-term loan maturing on April 30, 2015 took place on December 29, 2014. The contract was signed for the first time on April 30, 2009 and was renewed, also in advance, on November 3, 2011. This new funding is structured in two tranches: a loan totaling 275 million euros at six years amortizable and average life of five years, and a revolving credit for a maximum amount of 100 million euros in five years, renewable to six. The Group continues to meet the financial obligations set out in the syndicated financing contract, which stipulate compliance with certain economic parameters.

  • At the end of 2014 the Group had additional unused credit lines amounting to 135 million euros.

Evolución de la cifra de negocio

Financial structure variation in millions of euros other liquid assets, minus short-term and long-term debts with banks.