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Most significant data

Most significant data

The year 2013 has witnessed signs of global economic recovery, especially in the second half of the year. Highlights include macroeconomic improvements in both the U.S.A. and Japan — gross domestic product (GDP) growth of 1.9% and 1.6%, respectively — combined with emerging signs of recovery in the euro zone. Meanwhile, emerging economies have continued their expansion phase, although with signs of depletion in some cases.

Confidence has been restored to some extent, and there have been significant reductions in some of the risks affecting global financial stability, in particular, the euro zone crisis, the risk of fiscal collapse in the U.S.A. and significant capital outflows from emerging countries.

Evolución de la cifra de negocio

Turnover

In 2013 the Group posted a turnover of 1,572 million euros, a slight decrease of 1.8% compared to the previous year. This result has been uniquely affected by the depreciation of the euro — the currency for Group consolidation accounts — against currencies in virtually all emerging countries, the Group’s main growth engine in recent years. In particular, there was depreciation well over 10% in the Brazilian real (-13%), Indian rupee (-12%), Argentine peso (-20%) and Egyptian pound (-15%) and high depreciation in the Russian ruble (-6%) and British pound (-5%). In all these currencies, the Group’s operational volume is very high.

Excluding the exchange rates’ impacts on consolidated operations in euros, turnover shows a real growth of 4%, amounting to 1,664 million euros. This organic growth has occurred in the majority of markets in which the Group is present, with very significant increases in economies as diverse as Argentina, Switzerland, Germany, Malaysia, Egypt and Eastern European countries (Romania, Bulgaria and Croatia). Spain — the organization’s traditional market — has seen a drop of 8.1% compared to 2012, the seventh consecutive year of drop in sales, albeit somewhat smaller than in previous years.

Evolución del tipo de cambio del euro (2013)
Impacto del tipo de cambio en volumen de negocio

Results

EBITDA totaled 216 million euros, slightly higher than the amount posted the previous year even though sales were 1.8% lower than in 2012. The gross margin improved significantly, especially due to efforts to contain rising production costs worldwide. This has been the result of optimizing processes to increase productivity and improve performance; substituting imports of raw materials and components with the purchase of goods from local suppliers to mitigate the impact of exchange rates; investing in cost-reduction projects and taking structural measures to streamline the workforce at production facilities in countries with the highest drops in sales in recent years.

Although the Group has maintained strong competitiveness in prices, in most markets it has managed to implement new rates, although sale prices have increased less than local inflation rates. These new rates have been sufficient to compensate for increased costs worldwide. Improved profitability from operations, the launch of a series of high-added value products — especially in the ceramic tile business — and structural cost containment have meant that EBITDA was five million euros higher than in the previous year despite a lower turnover.

Net income reflects a gain of 53 million euros, compared to a loss of 31 million the previous year.The consolidated 2012 results were heavily affected by the costs associated with various downsizing policies and accounting adjustments due to asset impairment. These negative effects were not repeated in 2013; rather, the changes made and the improved economic situation in some markets have allowed for partial reversals of some asset impairments from previous years.

Resultados
Estructura financiera

Investments and financial structure

Investments in tangible and intangible fixed assets were 80 million euros this year, compared to 108 million in 2012. Investments have mainly focused on projects to expand production capacity in Brazil, India and Russia, markets in which the Group continues to invest year after year to ensure adequate production capacity to meet the needs of each market. The expansion activity in emerging economies has been accompanied by the necessary investments in the Group’s different factories and business units in order to maintain an appropriate level of technology, ensure our commitments to safety and the environment, and have information technology systems suitable for the business processes. As in 2012, no expansion operations were undertaken in 2013, and management policy continued to focus on consolidating and enhancing the operations acquired to date.

In terms of financial structure, the net financial debt shrunk 28 million euros from 360 million at 31 December 2013 despite the difficult economic situation faced by the sector. Debt containment has mainly been made possible thanks to efforts by the whole Group to rein in investments and structural costs and to control working capital.


Estructura financiera

The Group continues to easily meet its financial obligations to long-term syndicated loan contracts, which stipulate compliance with certain financial ratios.

Audited annual accounts