Tecnoglass Inc. (TGLS) Q4 2025 Earnings Report, Transcript and Summary

Good day, and welcome to the Tecnoglass, Inc. Fourth Quarter 2025 Earnings Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Mr. Blake Warren of Investor Relations. Please go ahead, sir.

Thank you for joining us for Tecnoglass Fourth Quarter and Full Year 2025 Conference Call. A copy of the slide presentation to accompany this call may be obtained on the Investors' section of Tecnoglass website. Our speakers for today's call are Chief Executive Officer, Jose Manuel Daes; Chief Operating Officer, Chris Daes; and Chief Financial Officer, Santiago Giraldo. . I'd like to remind everyone that matters discussed in this call, except for historical information, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding future financial performance, future growth and future acquisitions. These statements are based on Tecnoglass' current expectations or beliefs and are subject to uncertainty and changes in circumstances. Actual results may vary in a material nature from those expressed or implied by the statements herein due to changes in economic, business, competitive and/or regulatory factors and other risks and uncertainties affecting the operation of Tecnoglass' business. These risks, uncertainties and contingencies are indicated from time to time in Tecnoglass' filings with the Securities and Exchange Commission. The information discussed during the call is presented in light of such risks. Further, investors should keep in mind that Tecnoglass' financial results in any particular period may not be indicative of future results. Tecnoglass is under no obligation to and expressly disclaims any obligation to update or alter its forward-looking statements, whether as a result of new information, future events, changes in assumptions or otherwise. I will now turn the call over to Jose Manuel, beginning on Slide #4.

Thank you, Blake, and thank you, everyone, for participating on today's call. We are pleased to report another year of strong performance for 2025, our record revenues of $984 million reflect the strength across our businesses and our consistent ability to gain market share and capitalize on demand for our differentiated offerings. These results are a testament to the dedication of our team and the durability of the competitive advantages we have built over many years. Our single family residential business delivered yet another record year with revenues growing to an all-time high of $403 million. Growth was driven by our expanding dealer network, geographic diversification into new markets, a strong pricing execution, and the momentum in our vinyl product line. Our multifamily and commercial businesses was similarly strong with revenues growing to $580 million on robust demand for our high-performance products in high-end residential and luxury lodging projects. From an operational standpoint, I am particularly proud of our team's ability to maintain our industry-leading margin profile through a unique challenging year. This reflects our consistent pricing discipline and significant cost control measures. These actions more than offset the impact of tariffs and increased raw material costs supporting a stable gross margin for the year. We also continue to ramp up our vinyl windows product portfolio and diversified our manufacturing footprint through the Continental Glass System acquisition, both of which help us expand our presence into different markets and diversify our operational platform. This robust operational performance, along with our disciplined working capital management translated directly into strong cash generation. Cash flow from operations of $136 million for the full year allowed us to return substantial value to our shareholders through dividends and our share repurchase program. To that end, we repurchased $118 million in shares during the year, including $88 million in the fourth quarter alone. We announced today the Board has expanded our share repurchase authorization by $100 million, reflecting the confidence in our continued cash flow generation capabilities, the strength of our balance sheet and our commitment to delivering superior returns to shareholders. In summary, 2025 was a year that demonstrated the durability and adaptability of our business model. We grew revenue to nearly $1 billion, maintained our gross margin profile in the face of significant external headwinds, diversified our manufacturing and product platform and returned substantial capital to shareholders. Our performance, along with our record backlog positions us well for another year of record revenue and value creation in 2026. I will now turn the call over to Chris to provide additional operating highlights.

Thank you, Jose Manuel. Moving to Slide #5 and 6. We maintain a sharp focus on operational execution throughout 2025. Our overall performance through a dynamic macroeconomic environment reflects the durability of our differentiated platform and the dedication of our team to delivering best-in-class products and service to our customers. In 2025, we delivered double-digit revenue growth in our multifamily and commercial business driven by continued strong performance in our key markets and incremental contribution from our Continental Glass System asset acquisition completed at the beginning of the year. Continental continues to integrate smoothly into our operation, enhancing our capabilities in high-end architectural glass and glazing while providing us with a diversified manufacturing presence in Florida. Activity remains healthy across our commercial markets, given our expansion into new markets and ability to gain market share, which is reflected in our double-digit revenue growth expectations for 2026. The strength of our activity is also reflected directly in yet another backlog record number, which closed the year up 16% to a record $1.3 billion. Our book-to-bill ratio of 1.1x in the fourth quarter extended our track record to 20 consecutive quarters above 1.1x. Our project cancellation rate is near 0 given our late-stage installation profile and our backlog has demonstrated consistent sequential growth every quarter since 2021. I will also reiterate a key point that the composition of our backlog has shifted more towards high-end, large-sized projects recently, which tend to be less sensitive to higher interest rates and overall affordability constraints. Moving to Slide #7. Our single-family residential business achieved record full year revenues of $403 million compared to $372 million in 2024. The year-over-year improvement reflects dealership growth, geographic expansion and ongoing contributions from our vinyl products. Despite challenging macro conditions, we were encouraged to see orders received during the fourth quarter grow by double digits year-over-year with additional momentum into the new year as January orders outperformed the prior 2 months, giving us confidence heading into 2026. Over the course of 2025, our dealer base expanded considerably, driven largely by expansion into new geographies beyond our traditional core markets. Our Los Angeles showroom is expected to open in the first quarter of this year, adding to our existing showrooms in Florida, South Carolina, New York, Texas and Arizona and serving as a hub for our legacy light aluminum line in the Southwest. Our vinyl expansion continues to progress well with robust quoting activity validating the significant market opportunity ahead. Across all product lines, our quality, efficient lead times and superior service and competitive pricing continues to be key difference makers in attracting and retaining dealers. Turning to Slide #8. The broader market backdrop as we enter 2026 gives us additional confidence in our long-term trajectory. Total U.S. construction spending is expected to grow approximately 1% this year with residential spending projected to increase approximately 2% as affordability conditions improve. Contractor sentiment has moved back into expansion territory with the National Remodeling Conditions Index at 54.5 and the backlog component strengthened meaningfully to 70.4 in the first quarter of 2026 from 54.6 in the fourth quarter of 2025, a leading indicator that aligns well with what we are seeing in our own order activity. From a regional perspective, the South Atlantic, Mid-Atlantic and West South Central census divisions where our business is more concentrated are projected to be among the strongest performing regions for residential construction spending in 2026. This geographic alignment between our platform and the market expected to outperform underpins our growth outlook for 2026. Additionally, we continue to expect that market share gains in the new geographies and product segments will allow us to outperform market growth in years to come. I will now turn the call over to Santiago to discuss our financial results and full year outlook.

Thank you, Christian. Turning to the drivers of revenue on Slide #10. Total revenues for the fourth quarter increased 2.4% year-over-year to $245.3 million. The growth was driven by positive momentum in our multifamily and commercial business. This was partially offset by a modest decline in single-family residential, which saw pricing and share gains that we had a very challenging prior year comparison. Full year revenues increased 10.5% to a record $983.6 million. The full year growth came from both our multifamily and commercial and single-family residential businesses, reflecting strong execution on our record backlog, healthy conditions in our core Southeast high-end commercial portfolio, geographic expansion and continued traction in our vinyl product line. Looking at the profit drivers on Slide #11. Full year adjusted EBITDA reached $291.3 million, representing a margin of 29.6% compared to 31% in the prior year. On a full year basis, gross margin increased slightly to 42.8% compared to 42.7% in the prior year. The essentially stable full year gross margin despite challenging macroeconomic factors during the second half reflects stronger pricing and operating leverage that more than offset the impact of tariffs and higher raw material costs, a strengthening Colombian peso and higher salary expenses throughout the year. Full year SG&A as a percentage of revenue was approximately 20% compared to 17.2% in the prior year, mainly due to the tariffs paid during 2025, which increased our selling expenses year-over-year. Full year performance was stronger in the first half given different macro headwinds that started toward the middle of the year. Accordingly, adjusted EBITDA for the fourth quarter 2025 was $62.2 million, representing an adjusted EBITDA margin of 25.4% compared to $79.2 million or 33.1% in the prior year quarter. Consistent with the dynamics we highlighted on our last earnings call, the fourth quarter carried the full weight of the cost headwinds and stronger local currency that intensified through the second half of the year. Fourth quarter gross margin was 40% compared to 44.5% gross margin in the prior year quarter. The year-over-year change in gross margin was driven by 3 key factors: first, an unfavorable revenue mix with a higher proportion of installation revenues, which reached a record high during the fourth quarter; second, near all-time high U.S. aluminum costs, which continued their steep climb throughout the fourth quarter and significantly impacted our raw material costs; and third, a significant revaluation of the Colombian peso, which strengthened approximately 9.5% year-over-year in the quarter, creating an unfavorable effect on our margins. These headwinds were partially offset by stronger pricing flowing through from the adjustments we implemented earlier in the year. SG&A for the fourth quarter was 21.8% of revenue compared to 16.4% of revenue in the prior year quarter. The increase primarily reflected aluminum and reciprocal tariff expenses on stand-alone component sales, higher personnel expense from annual salary adjustments and stronger Colombian peso during the period and higher transportation and commission expenses associated with revenue growth. We provide a closer look at the primary headwinds that impacted our margins in the second half of 2025 on Slide #12, namely aluminum and FX, which continued to move sharply following our last earnings call. With respect to aluminum, it is important to distinguish between the 2 separate dynamics. The $25 million tariff impact we communicated earlier in the year was fully offset through our pricing actions. The more significant headwind was the sharp escalation in underlying aluminum cost independent of tariffs. Global aluminum spot rates spiked higher. And on top of that, U.S. Midwest aluminum premiums more than doubled during the year, creating industry-wide margin pressure that accelerated materially in the second half of the year. Separately, we faced aluminum and reciprocal tariffs on stand-alone component sales, which we have proactively addressed through targeted mitigation actions, including pass-through pricing on standalone glass and aluminum products and securing U.S. aluminum supply to mitigate tariff headwinds. As cost mitigation offsets our pricing adjustments implemented earlier in the year partially offset a portion of the higher aluminum cost in the fourth quarter. Looking ahead, our continued expansion into vinyl windows and eventual normalization of input costs or potential future pricing adjustments to reduce the impact of aluminum cost as a percentage of sales over time. We continue to evaluate incremental pricing actions as warranted by market conditions, but have not embedded this assumption within our guidance scenarios and could represent potential upside to our outlook. Looking at foreign exchange dynamics, the Colombian peso appreciated approximately 12% during full year 2025, moving from COP 4,308 to COP 3,791 per dollar. Given the approximately 20% to 25% of our costs are peso denominated, this appreciation made our Colombian cost base more expensive and pressure margins, compounded by salary adjustments in Colombia during the year. To partially mitigate this exposure, we hedged a portion of our Colombian peso exposure during 2025 and will continue to be opportunistic in executing hedges in 2026 above our current guidance assumptions, creating potential upside to guidance. Now examining our strong cash flow and balance sheet on Slide #13. We generated $135.8 million in operating cash flow for the full year 2025, driven by effective working capital management and solid underlying profitability. Capital expenditures of $89 million included scheduled payments on previous investments as well as expenditures related to the Continental Glass Systems acquisition. Our balance sheet remains solid with liquidity of approximately $465 million at year-end, including a cash position of approximately $100.9 million and $365 million of availability under our revolving credit facility and bilateral lines of credit. In September, we refinanced our senior secured credit facility, expanding capacity to $500 million, reducing spreads by 25 basis points and extending the maturity to 2030. We have no significant debt maturities until year-end 2030. With net debt to LTM adjusted EBITDA of 0.24x, we maintain a conservative leverage profile that provides significant financial flexibility to continue investing in growth initiatives and returning capital to shareholders. On Slide #14, our strong track record of generating returns above the broader industry continues to validate our disciplined capital allocation approach. Over the past 3 years, our strategic investments in operational excellence and capacity expansion have consistently delivered superior returns for our shareholders, driven by our industry-leading profitability, vertically integrated platform and significant improvements to working capital. These strengths continue to generate sustainable cash flow and shareholder value while preserving financial flexibility to pursue additional growth opportunities. We're also pleased to have returned substantial capital to shareholders through share repurchases and dividends during the year. During 2025, we repurchased $118 million in shares, including $87.6 million in the fourth quarter alone, partially funding that activity through a draw on our revolving credit facility, reflecting our conviction in the intrinsic value of the business. In total, we returned approximately $146 million to shareholders through repurchases and dividends. Given the Board's confidence in our continued cash flow generation capabilities, prudent balance sheet management and commitment to delivering superior returns to shareholders, they approved an expansion on our share repurchase authorization to $250 million in total, resulting in approximately $110 million of remaining repurchasing power. In addition to the expansion of the buyback program, our Board also approved the redomiciliation of the company from the Cayman Islands into the U.S.. Subject to shareholder approval, which will be sought within the next couple of months, the company would now be both headquartered and domiciled in the U.S., continuing our long-term strategy to become even more U.S.-centric as we become a larger company with a complete nationwide footprint. The redomicile into the U.S. will help us achieve tax efficiencies from a corporate level perspective as well as to facilitate dividend distributions to shareholders. Now moving to our outlook on Slide 16. Our full year 2025 performance demonstrated the strength of our business in a toughening macro environment into year-end that has continued into early 2026. Based on the visibility provided by our residential order book and multiyear backlog, we are introducing our full year 2026 outlook for revenues to be in the range of $1.06 billion to $1.13 billion, representing growth of approximately 11% at the midpoint of the range. Additionally, we're introducing our adjusted EBITDA outlook in the range of $265 million to $305 million. Our high-end outlook assumes continued downward trends in interest rates benefiting mortgage rates and improved affordability, a more favorable interest rate environment supporting a broader acceleration in project invoicing. The high-end outlook assumes continued market share gains and strong execution in new geographies and vinyl as well as full backlog execution without significant project delays. At the top end, we expect aluminum input costs to soften approximately 10% by the middle of the year versus year-end 2025 levels and the Colombian peso to trend toward COP 4,000 per dollar, which is essentially stable year-over-year. The top of the range also assumes annual salary adjustments in Colombia that are offset by favorable operating leverage and efficiency gains. The low end of our range contemplates a more challenging environment in which the Fed does not cut rates during the year, constraining residential invoicing momentum with high single-digit revenue growth driven primarily by backlog execution, market share gains and flattish single-family revenues. Under this scenario, we also assume a more gradual expansion in new geographies and vinyl and potential timing shift in certain commercial projects into 2027. The low scenario further assumes stable aluminum input costs versus year-end 2025 and the Colombian peso remaining below COL 3,800 per dollar with annual salary adjustments in Colombia not being fully offset by operating leverage. As mentioned earlier, our guidance range establishes a baseline that excludes several potential upside levers. Specifically, our outlook does not factor in additional pricing actions or opportunistic hedging strategies that we are actively evaluating to further protect margins. From a seasonal perspective, we expect the first quarter of the year to be softer as some of the aforementioned headwinds remain in place currently and the level of orders started picking up earlier this year with actual invoicing expected to take place within the second quarter and beyond. Both assumptions also bake in an incremental amount of installation revenue, in line with our previous discussions around the shift in backlog composition geared to larger projects in which we do both supply the windows and perform installation. Under both scenarios, we expect another year of strong free cash flow generation. Working capital should continue to be a source of cash as we further penetrate residential markets, though this will be partially offset by longer cash conversion cycles in our growing installation business. Capital expenditures are projected to be in the range of $60 million to $75 million, which includes maintenance CapEx at approximately 1% of revenues and the remainder for planned investments in efficiency initiatives. As previously disclosed, in 2025, we initiated a feasibility study for a new state-of-the-art largely automated facility in the U.S. If we decide to move forward with the project and the diligence process is completely favorably, our 2026 investment related to this would be limited to an estimated of $20 million to $25 million for the land acquisition only. This potential land purchase is not included in our current 2026 capital expenditure guidance and remains subject to a final investment decision and the ongoing assessment of demand trends and overall market conditions. Beyond the land purchase, we do not expect significant additional capital deployment on this initiative in 2026 as we complete equipment testing and continue to monitor demand trends. In conclusion, our fourth quarter and full year 2025 results demonstrate our ability to deliver strong results in a dynamic environment. We are leveraging our competitive advantages, including our vertically integrated manufacturing platform, our expanding geographic footprint and our diversified and growing product portfolio to gain share and drive long-term value for our shareholders. With a record backlog, a growing national presence in single-family residential, a strengthened balance sheet and multiple growth initiatives advancing, we entered 2026 with strong momentum. These advantages are structural and durable. Our share gains and geographic expansion are on track, and we remain confident in our ability to continue outperforming the market for years to come. With that, we will be happy to answer your questions. Operator, please open the line for questions.

[Operator Instructions] And the first question today will come from Sam Darkatsh with Raymond James.

So I'm just going to ask some clarification or quantification questions, Santiago. Apologies for this. You mentioned that the first quarter was softer. Can you give us a sense, generally speaking, of sales, gross margin, EBITDA type of thing that we should be expecting for the first quarter, knowing that 2/3 of it is done at this point?

More or less in line with Q4. That's what we would expect. Remember that in Q1, you also have a couple of weeks of scheduled maintenance shutdown. So you have a shorter quarter in line with Q4 when we shut down at the end of the year. So it would be more or less in line with that.

Got you. And then within the '26 framework at the low end and the high end, what are your expectations for gross margins, general and administrative and then also tariffs?

On tariffs, just the ongoing tariffs on stand-alone product, we continue to supply aluminum from the U.S. by being able to mitigate that impact. On the gross margin from the low to the high end, you have a 200 basis points of difference, from high 30s to low 40s, depending on where we are. And obviously, the main impact would be the input cost as it relates to raw materials, the FX. As you saw in the presentation, we are providing different scenarios that outline what the assumptions would be on either case. SG&A, we expect it to go down in terms of percentage of our sales based on the fact that we will not incur aluminum tariffs as we did in 2025. But obviously, on a nominal basis, when we're growing 11% at the midpoint, you have some variable expenses related to transportation and commissions and salary adjustments that increase the nominal base. But as a percentage of sales, the idea is that we should be slightly lower.

The next question will come from Rohit Seth with B. Riley.

Santiago, can you talk a little bit about the pricing actions that you have not yet implemented? What products are on? And when do you expect to put those price levels out?

Well, this is Jose Manuel. We have to wait and see the reaction of the total market in order to raise our prices. We would like to raise the prices. Obviously, we have done it in all the new jobs, but in residential, our competition is struggling. So they have not raised their prices in order to gain market share, and we have not raised them not to let them take the market that we do have. So we'll have to wait and see.

Okay. And just a follow-up on the vinyl and your new product lines. Can you just quantify how much of the new product lines you achieved in 2025 and what you're expecting to see in 2026?

Our base case shows that we ended up with vinyl roughly around $10 million for the year. We expect that to increase at least 2.5, 3x for 2026. We feel that there is upside to that base case and the cadence of sales will dictate how much we're able to ramp that up at the end of the year. As we had discussed in previous calls, the main issue was not having the full availability of the products, which we feel good about at this point in time. The dealer base has increased over 20% year-over-year. A lot of that is vinyl dealers. So in essence, the seed has been planted to execute and grow that a few times over year-over-year.

Understood. And so the certification of those products is done. You have the full product line set up and ready to go?

Yes, that is the case. It's just a matter of executing on sales now.

The next question will come from Tim Wojs with Baird.

Maybe just kind of first question. I guess, would you expect to see the U.S. commercial revenue accelerate in '26? I think it grew 11% in '25, but your backlog has clearly been up more than that over the past few years. So should we start to see those growth rates emerge as that backlog starts to convert in a bigger way in '26?

Yes, sir. Commercial is going to grow in '26 and '27 because not only we have a big backlog in Florida mostly, but we are expanding our reach into other markets by our installer GM&P. So we expect to -- the commercial side to keep growing at a very big pace, double digits or more.

Okay. And I guess when you're -- if you're thinking about kind of the backlog and the pipeline, I mean, has anything -- I know the market is choppy, but has anything changed there? I mean, do you guys still expect to see some pretty good backlog growth in '26 as well?

Yes. Yes, for sure. We see a lot of commercial activity in the Northeast that wasn't seen before. And now we are landing jobs in Texas, Utah, Colorado, and we expect with our new brand in California to get a lot of traction there, too.

Okay. Okay. Great. And then Santiago, just what is the residential assumption for revenue at the midpoint of the guide? I think they did, what, $403 million this year?

We ended up $403 million. What we're expecting is on the kind of legacy Florida business to be up low single digits. And then the rest of the growth coming from vinyl and non-Florida opportunities. And we expect that, obviously, altogether to equate to a double-digit growth year-over-year as well. So both segments, we are projecting to grow double digits and on the resi side, coming more from geographical expansion in vinyl.

The next question will come from Julio Romero with Sidoti & Company.

Thanks for the vinyl breakout earlier of about $10 million in '25. I think you said about 2.5 to 3x of that expected in '26. Kind of same question, but for the showrooms, your 5 showrooms, soon to be 6 in the first quarter. Just help us level set the contribution there. And is that separate from the vinyl contribution expected? How would you have us think about that?

Yes, yes, because the showrooms not only have the new vinyl lines, but they have the new legacy line and many new products that we are -- we developed last year, like, for example, the garage door. We have a garage door now, but it was only for impact, hurricane impact in Florida. Now we developed the garage door nationwide, and we expect that to ramp up a lot. And also we have a new few doors and windows that have had, I mean, tremendous success with our clients. They love it. And I think we're going to grow double digits, but we hope it's going to be a lot in the high double digits.

And I guess just to rephrase that a little bit, I guess I'm just asking how much incremental aside from the $10 million in vinyl came from the showrooms in '25 and how much kind of separate from that is '26 that doesn't overlap?

On the showrooms, remember that, that's both commercial and residential, right? So if we wanted to kind of break that out on the resi side for the showroom revenues, we ended up at about $10 million, and we're expecting to do $30 million to $35 million this year. So again, that segment of the business in line with the answer to Tim's question earlier is what is going to drive the single-family residential growth. Both vinyl and non-Florida resi are expected to grow 2.5, 3x this year.

Very helpful. And I guess you also mentioned that on the new plant that you're evaluating, you're also looking at new opportunities such as Buy America projects and a quick turnaround. I was just hoping you could dive into that a little bit for us.

Well, we are in the stage. This is Christian. We are going to be testing the new technology in Colombia first and make sure that we can reach a level of automation enough, so we require the least amount of people to work. I mean we don't want to have another place with 9,000 employees. We want to have 1,500 or the most 2,000 and be able to first deliver faster, also make about the same amount of money because there will be some savings on transportation and the tariffs and all that. And it will be to have also a good thing to have in the states. But obviously, this is not going to take care -- take place this year because we're going to be testing at the end of the year, all the technology. So it will be a decision that we'll make by February or March of next year of what to build in the U.S. and how to build it. We are close to buying the land. But it's also important for us to -- I mean, to our products to be Buy American. And another thing is that regardless of the product being manufactured in Colombia, almost all raw materials come from the U.S. So we are a Buy American company anyways.

Yes, absolutely. And I think maybe just to look at Christian, for another angle is just when I hear Buy America projects, I think about like federally funded infrastructure projects or something of that nature. So could your window products potentially participate in projects such as those?

Well, they used to be able to participate with the free trade agreement that we had in place because all the materials were manufactured in the U.S., but not anymore. So with the new plant, if we build it next year, that will be an advantage that we will have to be able to do federal buildings, too. So we're trying to keep growing and our idea is to double our sales in the next 3 to 5 years. And you know that we don't -- we're not doing this only for the money, but because it's our life, and we love what we do. And we've been doing it for over 40 years. So this is the way to go.

The next question will come from Jean Veliz with D.A. Davidson.

I apologize perhaps repeating some of the things you mentioned. But could you just kind of like walk me through with some of the cadence of the nonresidential -- the commercial and single-family kind of work that you'll be doing through first half and then second half compared with 2025. I guess what I'm getting to is I'm wondering, is there -- as you're expanding into Northern Florida and some of perhaps dynamic changes that it's occurring in your commercial side, is that influencing how you move to the backlog?

So let me rephrase and make sure I'm getting your question right. In terms of cadence of revenues, the way that we're projecting this is that each sequential quarter is going to be incremental revenues as we move through the year. As we said earlier, the first quarter is expected to be kind of more or less in line with Q4. And then sequentially, both because of the backlog visibility that we have and the geographical penetration and the vinyl ramp-up, we're expecting revenues both in the single-family residential and the commercial segments to go higher as we move through the year. So it's going to be backloaded based on those assumptions.

Okay. Appreciate that. And then just thinking about the impact of aluminum, is that under your assumption, does that alleviate then in the second half? Or is there a sequential taper coming off your 1Q guidance?

No. I mean if you look at the presentation that we put together and what we discussed here is that there's 2 scenarios. On the downside, we're assuming stable pricing in line with what you saw at the end of last year, which is kind of more or less what we're seeing today. If you're looking at the upside, we're assuming that aluminum prices taper off and we get a benefit in the second half of the year because as of now, we're almost 2 months into this and aluminum prices remain elevated.

Makes sense. And just on the vinyl, is there a space for a bigger upside as you have more and more products available, and you mentioned that there is better bundles that you -- and better opportunities when you sell these different products that have vinyl in them. Can we look -- is the 3x -- yes, is the 3x just the top? Or is there more of an upside that you could grow from there on that vinyl?

3x is the minimum we expect. We are very conservative on that side. If everything falls into place, we expect to do -- let's assume that this year, we were selling around $1 million a month. We expect from the second half of the year to do 5x, $5 million a month. And we believe that we're going to do -- that's going to ramp up next year to do at least $10 million. That's what we expect. But we'll have to see. But $30 million is a conservative estimate.

This concludes our question-and-answer session. I would like to turn the conference back over to Mr. Jose Manuel Daes for any closing remarks.

Well, thank you, everyone, for participating on today's call. And in spite of all that is happening in the market, in spite of the tariffs, in spite of the aluminum going up, in spite of the devaluation of the dollar, we have done very well. The company is going to keep striving. We have a lot of plans of growth for '26, '27 and '28. And we're going to make our clients happy and our investors more than happy. Thank you.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.