Shares of Tecnoglass (TGLS +3.57%) were down 10.9% as of 3:15 p.m. ET Monday after the high-end window and architectural glass company announced strong third-quarter results, but followed with underwhelming forward guidance.
Tecnoglass' quarterly revenue grew 4.4% year over year to $210.7 million, translating to adjusted (non-GAAP) net income of $46.6 million, or $0.98 per share. Analysts, on average, were looking for slightly lower adjusted earnings of $0.97 per share on revenue of $207.6 million.
NYSE: TGLS
Key Data Points
Tecnoglass' solid third quarter just wasn't enough
The company's top-line growth was entirely organic, including a 2% increase in revenue from the single-family residential end market to 87.8 million, and 6% growth from multi-family/commercial revenue sources to comprise the remainder.
"Steady demand for our best-in-class, innovative products contributed to record single-family residential revenues, which continues to outperform despite a challenging environment," said Tecnoglass Chief Operating Officer Christian Daes. Daes added that positive momentum continues within the company's multi-family/commercial segment, with a backlog growing to $836 million, "giving us confidence in the trajectory of this business with a solid project pipeline into 2025."
On Tecnoglass' tempered guidance
Based on visibility for the timing of project deliveries through the end of the year, however, Tecnoglass also reduced its full-year 2023 outlook to call for revenue of $835 million to $848 million -- down from $830 million to $855 million previously -- or 17% growth at the midpoint. Coupled with expectations for unfavorable noncash foreign currency exchange, as well as a higher mix of installation revenue in Q4, the company also lowered its outlook for 2023 adjusted EBITDA to be in the range of $300 million to $308 million, down from its prior range of $320 million to $335 million.
That's not to say Tecnoglass is a broken business. But the market obviously hates to see any given company lower its full-year guidance even after delivering a quarterly beat. It's hard, then, to blame some investors for taking a step back from the stock today.
