Tecnoglass Inc

Overview

Tecnoglass is a leading vertically integrated manufacturer, supplier and installer of architectural glass, windows, and associated aluminum and vinyl products for the global commercial and residential construction markets. Tecnoglass earned the #1 spot on Forbe’s list of America’s 100 most successful small-cap companies for 2024, and was ranked among the four largest glass fabricators in 2024 by Glass Magazine. Headquartered in Barranquilla, Colombia, the Company operates out of a 5.8 million square foot vertically-integrated, state-of-the-art manufacturing complex that provides easy access to the Americas, the Caribbean, and the Pacific. Tecnoglass supplies over 1,000 customers in North, Central and South America, with the United States accounting for 96% of revenues. Tecnoglass’s tailored, high-end products are found on some of the world’s most distinctive properties, including the Aston Martin Residences (Miami), Miami World Tower (Miami), 3ELEVEN (New York), Raffles Hotel (Boston), Norwegian Cruise Line Terminal B (Miami), One Thousand Museum (Miami), Paramount Miami Worldcenter (Miami), Salesforce Tower (San Francisco) and AE’O Tower (Honolulu).

Our Business

General

We are experienced and highly skilled in the vertical integration of architectural glass manufacturing, distribution, and professional fitting. Our expertise extends to the production of top-quality windows, as well as the supply of aluminum, vinyl, and other components. Our dedicated and knowledgeable team serves a diverse range of commercial and residential construction projects worldwide, guaranteeing outstanding products and seamless installation services. With a focus on innovation, combined with providing highly specified products with the highest quality standards at competitive prices, we have developed a leadership position in each of our core markets. In the United States, which is our largest market, we were ranked among the four largest glass fabricators serving the United States in 2024 by Glass Magazine. In addition, we believe we are the leading glass transformation company in Colombia. Our customers, which include developers, general contractors or installers for hotels, office buildings, shopping centers, airports, universities, hospitals and multi-family and residential buildings, look to us as a value-added partner based on our product development capabilities, our high-quality products and our unwavering commitment to exceptional service. We were ranked by Fortune Magazine as the 27th fastest-growing company in the United States for 2024, based on Tecnoglass’ strong revenue growth, earnings per share growth, and three-year annualized return to shareholders for the period ended June 30, 2024.

With over 40 years of experience in architectural glass and aluminum assembly, we specialize in transforming various glass products. Our offerings include tempered safety glass, double thermo-acoustic glass, and laminated glass. Our wide range of finished glass products are utilized in diverse buildings for floating facades, curtain walls, windows, doors, handrails, as well as interior and bathroom spatial dividers. In addition to glass, we manufacture aluminum and vinyl products such as profiles, rods, bars, plates, and other hardware specifically designed for window manufacturing.

Our products are manufactured in a 5.8 million square foot, state-of-the-art manufacturing complex in Barranquilla, Colombia that provides easy access to North, Central and South America, the Caribbean and the Pacific. Our products can be found on some of the most distinctive buildings in these regions, including the Aston Martin Residences (Miami), Miami World Tower (Miami), 3ELEVEN (New York), Raffles Hotel (Boston), Norwegian Cruise Line Terminal B (Miami), One Thousand Museum (Miami), Paramount Miami Worldcenter (Miami), Salesforce Tower (San Francisco) and AE’O Tower (Honolulu). Our track record of successfully delivering high profile projects has earned us an increasing number of opportunities across the United States, evidenced by our expanding backlog and overall revenue growth.

Our structural competitive advantage is underpinned by our low-cost manufacturing footprint, vertically integrated business model and geographic location. Our integrated facilities in Colombia and distribution and services operations in Florida provide us with a significant cost advantage in both manufacturing and distribution, and we continue to invest in these operations to expand our operational capabilities. Our lower cost manufacturing footprint allows us to offer competitive prices for our customers, while also providing innovative, high quality and high value-added products, together with consistent and reliable service. We have historically generated high margin organic growth based on our position as a value-added solutions provider for our customers.

We have a strong presence in the Florida market, which represents a substantial portion of our revenue stream and backlog. Our success in Florida has primarily been achieved through sustained organic growth, with further penetration taking place into other highly populated areas of the United States. As part of our strategy to become a fully vertically integrated company, we have supplemented our organic growth with some acquisitions that have afforded us incremental control over our supply chain while maintaining efficient lead times. For instance, in 2016, we completed the acquisition of ESW, which gave us control over the distribution of products into the United States from our manufacturing facilities in Colombia. In March 2017, we completed the acquisition of GM&P, a consulting and glazing installation business that was previously our largest installation customer.

The continued diversification of the group’s presence and product portfolio is a core component of our strategy. In particular, we are actively seeking to expand our presence in United States outside of Florida. Since 2017, we have been expanding our presence in U.S. residential markets which went from less than 5% of our sales to nearly 41.9% of our sales for the full year 2024. We believe that the quality of our products, coupled with our ability to price competitively given our structural advantages on cost, and our efficient lead times given our vertically integrated model, will allow us to generate further growth in the future.

We have focused on working withThe Power of Quality, always making sure that our vision of sustainability is immersed into every aspect of our business, including social, environmental, economic and governance variables (“ESG”), that help us make decisions and create value for our stakeholders. We purposefully implement initiatives aligned with our global sustainability strategy, which rests on three fundamental pillars: promoting an ethical and responsible continuous growth, leading eco-efficiency and innovation, and empowering our environment. As part of this strategy, the Company has voluntarily adhered to UN Global Compact Principles since 2017. In 2021, in pursuit of our cooperation with the attainment of the Sustainable Development Goals (“SDGs”) created by the United Nations, we joined a program to dynamize, strengthen and make visible the reduction of greenhouse gas emissions set out by the Colombian government by 51% in 2030 and to reach carbon neutrality by 2050.

Competitive Strengths

Our success has been grounded in our ability to offer high quality products at competitive prices and with efficient lead times. We are able to competitively price our products, while still achieving strong margins, due to a number of unique cost advantages. In addition to our vertically integrated business model, we benefit from structural cost advantages in manufacturing and distribution due to our geographic location. Alongside these structural advantages, we are committed to quality, product innovation and customer service. We believe these competitive strengths create a significant barrier to entry, which is underpinned and sustained by the experience of our senior management team and the loyalty of our highly motivated employees.

Vertical Integration

We believe we are unique within the industry in vertically integrating the purchasing of raw materials and the manufacturing, distribution, and installation of our products. By vertically integrating each of these functions, we are able to eliminate inefficiencies throughout the supply chain and generate strong margins. These efficiencies are only enhanced as our business grows and we benefit from operating leverage and economies of scale.

In 2019 we entered into a joint venture agreement with Compagnie de Saint-Gobain S.A. (“Saint-Gobain”), a world leader in the production of float glass, a key component of our manufacturing process, whereby we acquired a 25.8% minority ownership interest in Vidrio Andino Holdings S.A.S (“Vidirio Andino”), a Colombia-based subsidiary of Saint-Gobain. The joint venture agreement includes plans to build a new plant that will be located approximately 20 miles from our primary manufacturing facility in Barranquilla Colombia, in which we will also have a 25.8% interest. The new plant will be funded with proceeds from the original cash contribution made by us, operating cash flows from the Bogota plant, debt incurred at the joint venture level that will not be consolidated into our company.

The joint venture agreement includes plans to build a new plant in Galapa, Colombia that will be located approximately 20 miles from our primary manufacturing facility, in which we will also have a 25.8% interest. The new plant will be funded with proceeds from the original cash contribution made by us, operating cash flows from the Bogota plant, debt incurred at the joint venture level that will not be consolidated into our company and an additional contribution by us of up to approximately $12.5 million if needed (based on debt availability or other sources).

This joint venture has solidified our vertical integration strategy by providing us with an interest in the first stage of our production chain, while securing ample glass supply for our expected production needs.

This business model also allows us to maintain strict quality control, from the sourcing of input materials to the installation of our finished products. Our vertically integrated business model therefore enables us to provide consistent high-quality products to our end-customers. Ownership of the entire production process also reduces our dependence on third parties, allowing us to respond more quickly to our customers’ needs and reducing lead-times for new or customized products.

Our vertical integration allowed us to successfully navigate the global supply chain constraints of 2020 and 2021 which severely impacted many sectors of the global economy, including shortages in supply of materials, slowdown of logistic operations and cost inflation.

Cost of Production Advantages

We enjoy significant cost advantages because of our location in Colombia that we would not be able to realize if our production facility was located in the United States. We believe we are able to offer competitive prices, in part, as a result of our low labor and energy costs relative to those in the United States while maintaining efficient transportation costs into the markets we serve. Employees at our manufacturing facilities in Colombia earn above the local minimum wage, yet these wages are typically much less than the cost of a comparable employee located within the United States. In 2018, we completed a solar panel project with the capacity to generate approximately five megawatts of eco-friendly energy on-site at our manufacturing facilities. This investment has allowed us to reduce energy costs, while also having a positive tax effect due to our ability to deduct the investment from our taxable income in compliance with applicable Colombian tax regulations. To date, more than 15,000 solar panels have been installed on the roofs of Colombian manufacturing plants to generate reliable and clean energy. While enhancing production cost efficiencies, along with ESG initiatives, we entered into a long-term power purchase agreement to cogenerate 9MW through two gas engines with a heat recovery system.

Low-Cost Distribution

Our principal manufacturing facility is located in Barranquilla, Colombia, which is strategically located near three of the country’s major ports: Barranquilla, Cartagena and Santa Marta. These ports provide us with maritime access to all major global markets. The Barranquilla port is just 16 kilometers away from our production facility. From there, our products can be shipped to Miami in three days and New York in one week. In addition, for short lead-time projects, our products can be transported by air from Barranquilla to Houston or Miami within a few hours.

As a result of the significant trade imbalance between Colombia and the United States for goods transported in container ships, we are able to transport our products to the United States in containers that would otherwise return empty to the United States. We are therefore able to distribute our products to the eastern, southern and western regions of the United States at very attractive rates, which are often lower than a comparable domestic land shipment within the United States. Demand for high-specification architectural glass is typically highest in large coastal cities, which we are able to ship directly, while most of our competitors must utilize relatively expensive land transportation services to deliver finished goods to these sites.

Commitment to Quality and Innovation

Our commitment to quality is evidenced by our significant investments in land, warehousing space, machinery and equipment. Since 2022, we have invested nearly $260 million in the latest technologies to enhance the efficiency and accuracy of our production lines, and ultimately to improve the quality of the products that we deliver to our customers. We believe these significant investments position us to meet our growth objectives over the next several years. We operate state-of-the-art glass making equipment, glass laminating lines, aluminum presses, vinyl assembling lines, and high-volume insulating equipment which facilitate more precise manufacturing, enabling us to offer a broader selection of and higher quality products and remain agile in responding to customer demands, while generating less raw material waste.

We believe our investments in technology have positioned us well for continued growth in the years ahead given the flexibility afforded by our current installed capacity, improved profitability, and enhanced cash generation. Recent examples of our high return investments within the last three years include:

Our quality assurance department maintains rigorous oversight over the production process to ensure the consistent production of high-quality products. In addition, we adhere to quality standards that meet all guidelines and requirements for the Insulating Glass Certification Council (“IGCC”) and Safety Glazing Certification Council (“SGCC”) certification programs.

Finally, our commitment to quality also extends to our partnerships and alliances. Most notably, for certain products, we offer Kuraray Sentryglass®. These laminated glass interlayers are five times stronger than conventional laminating materials.

Superior Customer Service

In addition to manufacturing high quality products at competitive prices, our customer value proposition is supplemented by short lead-times, on-time delivery and after-sale support. Through the coordinated efforts of our sales teams, product specialists and field service teams, we deliver high quality service to our customers, from the initial order to the delivery and installation of our products, when applicable. We believe our ability to accompany our clients throughout every phase of their projects’ design, engineering, consulting, manufacturing and installation along with our ability to coordinate these efforts as a one-stop-shop is a key differentiator from our competition.

High Barriers to Entry

The ability of new competitors to enter the markets that we serve is limited due to the technical certifications required on high specification building projects, such as IGCC, IqNet Icontec 14001 and ISO9001. We attribute our success, in large part, to our ability to produce a broad range of sophisticated products, as well as our reputation for delivering high quality, made-to-order architectural glass and building enclosures on time. Our employees have extensive training, knowledge and experience at manufacturing high specification products. We believe the vertically-integrated nature of our operations means that there are high barriers to successfully entering our markets and competing with us on price, quality and agility. In addition, the equipment needed to operate in the glass and window industry is expensive, therefore requiring significant upfront capital investment.

Loyal and Highly Motivated Employees

Capitalizing on our various competitive advantages also requires a skilled and dedicated workforce. We actively encourage and facilitate the development of our employees through rolling training programs, with multiple training sessions held every week. These programs increase the skills of our employees and are designed to allow our employees to keep pace with the new technologies being installed at our manufacturing facilities. We are committed to developing our employees and remaining at the forefront of technology in our industry. These investments have also contributed to workplace safety, with our Lost Time Injury Frequency Rate (LTIFR), which measures the number of lost-time injuries per million hours worked during the financial year, of 2.3% which is substantially lower than the average for manufacturing companies in Colombia which stood at approximately 9.1% for 2024.

We value our employees and invest in them and our local communities. For several decades, our Tecnoglass ES Windows Foundation has committed resources to create projects to assist and contribute to the region’s development. For many years, we have allocated resources from the foundation to initiate and support various regional development projects. In 2024, our scholarship program allowed over 530 students to pursue higher education at Colombian universities. We support local educational entities and organizations pursuing societal change and community enhancement. Our multiple programs also include collaboration with partners to promote sports and encourage healthy lifestyles among the youth. Our goal at the Tecnoglass ES Windows Foundation is to create positive and lasting impacts on our employees and the communities we serve. Through our home improvement program, we acknowledge the commitment and dedication of the Tecnoglass group employees by supporting them to enhance their homes or purchase their own, ensuring the well-being of their families. During 2024, we delivered more than 107 housing improvements.

These and other initiatives have allowed us to maintain a strong relationship with the communities and our employees. We continuously strive to make a difference for our people, contributing to building a better future for the region and our country.

Strategy

We have identified the following strategic priorities that we believe are important in advancing our business:

Further Geographic Penetration in the United States

We have successfully established a leading reputation in the Florida construction market by providing high value, impact-resistant architectural glass products. Our products have become widely regarded in Florida for their quality and are certified in compliance with all U.S. regulations.

Given advantageous secular and demographic trends, sales in Florida comprised 89% of United States revenue in the year ended December 31, 2024. In recent years, we have successfully grown our geographic presence in the United States outside of Florida, particularly into markets along the east coast, and as a result, nearly 16% of our U.S. backlog is for projects outside of Florida. Coastal markets are particularly attractive to us, as they can be directly accessed by ship, resulting in transportation costs from our manufacturing facilities that are similar to our transportation costs to Florida. These regions are also affected by hurricanes, significant temperature fluctuations and other extreme forms of weather that foster demand for our products. We are actively expanding our sales presence in these costal markets and have already successfully completed several projects in large U.S. markets such as New York, Boston, Washington D.C. and Baltimore as well as cities along the U.S. Gulf Coast, such as Houston.

We intend to continue growing the business organically outside of Florida. As we explore growth opportunities in new U.S. markets, we intend to leverage the strong reputation we have developed with national commercial construction contractors, architects, and designers for providing high quality products at the most competitive prices.

In late 2023, we entered into the vinyl window market, expanding our product portfolio to more than double our addressable market, and offering customers a wider selection of solutions to meet their project needs. We intend to capitalize on our existing distribution base for our aluminum products to obtain significant synergies given the significant number of dealers and distributors that already sell both aluminum and vinyl windows. Additionally, we expect to benefit from a wider product offering in markets where vinyl frames and windows are more prevalent than aluminum ones. We started deliveries of vinyl products in 2024 and gradually continued to grow our order flow through year end, a trend that we expect to continue as we move forward with the onboarding of new clients in different geographies.

Penetrate the U.S. Residential Market

In addition to increasing our penetration in the U.S., we continue to seek to further expand our offerings in the U.S. To this end, in April 2017, we launched “ES Windows: Elite Collection” and “ES Windows: Prestige Collection” to target the U.S. residential new and replacement sectors. We have received significant interest for the new products within these categories to date and positive reactions from our customers. Currently, residential sales represent a considerable portion of our total sales, and we believe we will continue growing into this end market in the U.S through share gains, new products and a commitment to execution. We had a significant demand in the U.S. residential market, representing 41.9% of our total sales for the year ended December 31, 2024, compared to less than 5% for the year ended December 31, 2017, and 40.3% for the year ended December 31, 2023. The U.S. private residential construction market exceeded $950 billion in spending during the twelve months ended December 31, 2024, according to the United States Census Bureau. Single Family Residential housing starts in the U.S. increased by 6.5% during December 2024 compared to December 2023, according to the U.S. Census Bureau. We believe that our core strengths that have facilitated our success to date, namely the quality of our products and the structural cost advantages that allows us to price our products competitively, will similarly contribute to our ongoing success and continued penetration into the U.S. residential end market in order to target several other geographies. In line with the geographic penetration strategy, we have started expanding our presence to other markets by opening product showrooms in other states. As of the date of this Annual Report, showrooms in New York City, Charleston, SC, Houston, TX, and Bonita Springs, FL, have been opened to service its respective regions. Additionally, showrooms in Phoenix, AZ and Los Angeles, CA are in the lease negotiating stages and we expect such showrooms to open in 2025.

Continued Investment in Technology to Meet Evolving Demands

We have a track record of developing innovative new products, and we intend to continue our focus on new product opportunities in the future. We are constantly identifying shifts in global trends and customer needs and designing new products to meet those changes in demand. In order to continue this success, it is critical that we invest in the latest technologies available in our industry. For example, with the installation of our soft-coating facility, we became able to manufacture low emissivity glass that is energy efficient allowing us to meet growing demand for “green” products.

We operate state-of-the-art architectural glass transformation equipment, glass laminating lines, aluminum presses, vinyl assembling lines, and high-volume insulating equipment, which facilitate more precise manufacturing and generate less raw material waste. We seek to leverage this platform of cutting-edge equipment to adapt our products to evolving demands in both current and new markets. We expect that our focus on innovation, which is founded upon our investments in technology, will position us well to take advantage of new opportunities.

We have carried out enhancements at our glass and aluminum facilities to increase production capacity and automate operations. We anticipate that these high return investments will continue generating efficiencies in the production processes. We improved efficiency in our glass production during 2023 and 2024 by further automating certain key manufacturing processes to increase capacity, while reducing material waste and overall lead times. In 2022, we invested in additional automation of our internal production processes that reduce lead times for the assembly of architectural systems and capacity expansion which was fully operational by the second half of 2023. In addition, during 2023, we made investments in our newly installed vinyl assembling lines to manufacture and distribute cutting-edge vinyl windows for new and existing customers starting in November 2023. During 2024 we completed the second phase of expanding our architectural metal facade plant, which specializes in engineering, designing, and manufacturing tailor-made façade. We expect to continue funding these capital investments mainly with cash on hand.

Rigorous Adherence to Quality Standards

Maintaining the high-quality standards for which we have become known is essential to the execution of our strategy. All of our internal processes are continually and independently supervised by Tecnoglass’s Quality Assurance department. The Quality Assurance department maintains rigorous oversight of optimization indicators covering energy, water, recyclable waste and other facets of the production process. Constant monitoring of these indicators is integral to ensuring that we consistently produce high quality products. Approximately 5% of our production is randomly selected to verify compliance with a variety of quality standards, such as water leaks, functionality, manufacturing, and accessories, according to ASTM International (“ASTM”) and American Architectural Manufacturers Association (“AAMA”) rules.

These measures allow us to effectively detect issues and take specific actions to mitigate their reoccurrence. As we grow and our use of technology evolves, our Quality Assurance team must also evolve its tests, controls and remedies. We believe this rigorous adherence to quality control will ensure that we will continue to provide the highest quality products and, ultimately, promote customer satisfaction.

Products

We manufacture and sell the following products:

Brands and Trademarks

Our main brands are Tecnoglass, ESWindows and Alutions. Our registered trademarks include The Power of Quality, Energia Solar, ES, ES Imagine Extraordinary, Tecnoglass, Alutions, Eswindows, Tecnobend, Tecnoair, Tecnosmart, ECOMAX by ESWINDOWS, ESWINDOWS Interiors, ESW Windows and Walls, Solartec by Tecnoglass, Prestige by ESWINDOWS, Eli by ESWINDOWS, Alessia by ESWINDOWS, Elite Line by ESWindows, ULTRAVIEW by Tecnoglass, and MULTIMAX by ESWIDOWS. We rely on a combination of patent, trademark, unfair competition and trade secret laws, as well as confidentiality procedures and contractual restrictions, to establish, maintain and protect our proprietary rights.

Sales, Marketing and Customer Service

Sales and Marketing

Our sales strategy primarily focuses on attracting and retaining customers by consistently providing exceptional customer service, leading product quality, and competitive pricing. Our customers also value our shorter lead times, knowledge of building code requirements and technical expertise, which collectively generate significant customer loyalty. We primarily market our products based on product quality, outstanding service, shorter lead times and on-time delivery.

Our products are marketed using a combination of internal sales representatives, independent sales representatives and directly to distributors. We believe this strategy is highly efficient for our business. Our internal sales representatives receive a portion of their performance-based compensation based on sales and profitability metrics. Additionally, some of our sales and marketing efforts are handled by area sales representatives who work on a commission basis.

We do not rely on significant traditional advertising expenditures to drive net sales. We have established and maintain credibility primarily through the strength of our products, our customer service and quality assurance, the speed at which we deliver finished products and the attractiveness of our pricing. Our advertising expenditures consist primarily of new showrooms opening, provisions for events, and maintaining our subsidiaries’ websites.

Customer Service

We believe that our ability to provide customers with outstanding service is a strong competitive differentiator. Our customer relationships are established and maintained through the coordinated efforts of our sales and production teams. We employ a highly responsive and efficient team of professionals devoted to addressing customer support with the goal of resolving any issue in a timely manner. In order to promote customer loyalty and employee development, we developed an employee training program with the primary objectives of educating our staff to be aware of client and supplier needs and familiarizing them with our strategic goals in order to improve the competitiveness, productivity and quality of all products offered.

Working Capital Requirements and Debt Facilities

During the year ended December 31, 2024, we generated $170.5 million of cash from operating activities. We anticipate that working capital will continue to be a net benefit to cash flow in the near future, which in addition to our current liquidity position, provides ample flexibility to service our obligations through the next twelve months.

Our debt is comprised primarily of a Senior Secured Credit Facility which consists of a term loan and a Committed line of Credit. The term loan had a balance of $110 million as of December 31, 2024, matures in late 2026 and bears interest at SOFR plus a spread of 1.5%. The committed line of credit of $150 million was mostly unused as of December 31, 2024.

Customers

Our customers include architects, building owners, general contractors and glazing contractors in the commercial construction market. We currently have approximately 1000 customers. Of our 100 largest customers, which represent over 72% of our sales during the twelve months ended December 31, 2024, approximately 98% are located in North America and 2% in Latin America. No single customer accounted for more than 10% of our revenues during the years ended December 31, 2024, and 2023.

Materials and Suppliers

Our primary manufacturing materials include glass, ionoplast, polyvinyl butyral, and aluminum and vinyl extrusions. Although in some instances we have agreements with our suppliers, these agreements are generally terminable by us or the supplier counterparties on limited notice. Typically, all of our materials are readily available from a number of sources, and no supplier delays or shortages are anticipated.

We source raw materials and glass necessary to manufacture our products from a variety of domestic and foreign suppliers. During the year ended December 31, 2024, two suppliers accounted for more than 10% of total raw material purchases, and in aggregate both account for 25.1% of total raw material purchases. During the year ended December 31, 2023, two suppliers accounted for more than 10% of total raw material purchases, and in aggregate both account for 22.1% of total raw material purchases.

Warranties

We offer product warranties, which we believe are competitive for the markets in which our products are sold. The nature and extent of these warranties depend upon the product. Our standard warranties are generally from five to ten years for architectural glass, curtain wall, laminated and tempered glass, window and door products. Warranties are not priced or sold separately and do not provide the customer with services or coverages in addition to the assurance that the product complies with original agreed-upon specifications. In the event of a claim against a product for which we have received a warranty from the supplier, we transfer the claim back to the supplier.

The cost associated with product warranties was $2.6 million and $1.9 million during the years ended December 31, 2024 and 2023, respectively.

Certifications

Among our many designations and certifications, Tecnoglass has earned the Miami-Dade County Notice of Acceptance (“NOA”), one of the most demanding certificates in the industry and a requirement to market hurricane-resistant glass in Florida. Tecnoglass’s products comply with Miami-Dade county’s safety code standards as its laminated anti-hurricane glass resists impact, pressure, water and wind. Tecnoglass is also the only company in Latin America authorized by PPG Industries and Guardian Industries to manufacture floating glass facades.

Our subsidiaries have received a number of other certifications from other national and international standard-setting bodies.

TG certifications include:

ES certifications include:

ESW certifications include:

Complies with minimum security criteria for U.S. Importer of Customs Trade Partnership Against Terrorism (CTPAT) Tier 3 Category.

ES Metals certification:

ISO 9001:2015 Certificate of Quality Assurance

Tecnoglass Inc:

Verification of the Greenhouse Gas Inventory in Compliance with the GHG Protocol and the ISO 14064-3 Standard, certified by ICONTEC.

Competitors

We have local and international competitors that also focus on glass and aluminum transformation, window ensemble and installation and designing in the commercial and residential construction markets. The market in the United States in which we compete is mainly comprised of manufacturers, distributors and installers of glass curtain walls, windows and doors for commercial and residential buildings. Based on our analysis of the IBIS World Report, we estimate that we capture between 1% and 2% of the U.S. consolidated market by revenue (manufacturing and services), which represents an attractive opportunity for further penetration. In Colombia, we believe we are the leading producer of high-end windows, with over 40 years of experience in the glass and aluminum structure assembly market. The industry has a few well-known players and is mostly fragmented and comprised of small competitors. We currently compete with companies such as Viracon (a subsidiary within the Apogee Enterprises Inc. Group), PGT, Cardinal Glass and Oldcastle Glass among others in the United States and companies such as Vitro, Vitelco and others in the Colombia and Latin America.

The key factors on which we and our competitors compete for business include quality, price, reputation, breadth of products and service offerings, and production speed leading to shorter lead times. We face intense competition from both smaller and larger market players who compete against us in our various markets including glass, window and aluminum manufacturing.

The principal methods of competition in the window and door industry are the development of long-term relationships with window and door distributors and dealers, and the retention of customers by delivering a full range of high-quality customized products on demand with short turnaround times while offering competitive pricing. The vertical integration of our operations, our geographic scope, low labor costs and economies of scale have helped our subsidiaries consolidate their leading position in Colombia and bolstered their expansion in the United States and other foreign markets.

Government Regulations

We are subject to extensive and varied federal, state, and local government regulation in the jurisdictions in which we operate, including laws and regulations relating to zoning and density, building design and safety, hurricane and floods, construction, and similar matters. In particular, the market for our impact-resistant windows and doors depends in large part on our ability to satisfy state and local building codes that require protection from wind-borne debris. Additionally, certain of the jurisdictions in which we operate require that installation of doors and windows be approved by competent authorities that grant distribution licenses. We have invested significantly in our quality assurance department in order to maintain rigorous oversight over the production process to ensure the consistent production of high-quality products. We have been certified in compliance with rigorous safety standards, as described in more detail in the section titled “—Certifications.”

We are subject to laws and regulations relating to our relationships with our employees, public health and safety and fire codes. Although our business and facilities are subject to federal, state and local environmental regulation, environmental regulation does not have a material impact on our operations.

Research and Development

During the years ended December 31, 2024, 2023 and 2022, we spent approximately $2.1 million, $0.9 million, and $0.6 million, respectively, in research and development. The Company incurs costs related to the development of new products and pays for external tests that need to be performed on our products in order to comply with strict building codes.

Human Capital

As of December 31, 2024, we had a total of 9,837 employees, none of whom is represented by a union. As of December 31, 2023, we had a total of 8,531 employees. We actively encourage and facilitate the development of our employees through rolling training programs, with multiple training sessions held on a weekly basis. These programs increase the skills of our employees and are designed to allow our employees to keep pace with the new technologies being installed at our manufacturing facilities. We are committed to developing our employees and remaining at the forefront of technology in our industry. These investments have also helped us manage workplace injuries, with a Lost Time Injury Frequency Rate of 2.3%, which is considerably lower than the average rate of approximately 9.1% for glass and metal manufacturing companies in Colombia for 2024. We have remained union-free since ES’s incorporation in 1983. The Company considers itself an equal opportunity employer and has constantly sought to seek the best talent irrespective of gender or ethnicity. While the jobs associated to the core manufacturing operations are predominantly filled by males, our sales and administrative staff is comprised of approximately 32% females and 68% males. From an ethnicity perspective, our labor force is diverse but predominantly Latino based on our geographic location.

Company History

We are an exempted company incorporated under the laws of the Cayman Islands. We were incorporated in 2013 in connection with a business combination between Tecnoglass subsidiaries TG and ES, and Andina Acquisition Corporation. TG and ES are corporations formed under the laws of Colombia and founded in 1994 and 1983, respectively, by José M. Daes, our Chief Executive Officer, and Christian T. Daes, our Chief Operating Officer.

Additional Information About the Company

We maintain websites for our subsidiaries, TG, ES Windows, GM&P and ES Metals, which can be found at https://www.tecnoglass.com/es/, https://eswindows.com, https://wwwgmpglazing.com, https://es-metals.com, respectively. The corporate filings of Tecnoglass Inc., including our Annual Reports on Form 10-K, our Quarterly Reports on Form 10-Q, our Current Reports on Form 8-K, our proxy statements and reports filed by our executive officers and directors under Section 16(a) of the Securities Exchange Act, and any amendments to those filings, are available free of charge on the Investor Relations page at investors.tecnoglass.com, which are uploaded as soon as reasonably practicable after we electronically file (or furnish in certain cases) such material with the Securities and Exchange Commission, and can also be found at the SEC’s website at http://sec.gov. We do not intend for information contained in any of our websites, including the Investor Relations pages, to be a part of this Form 10-K.