Masisa sales revenues drop in Q3 as result of divestments14 January 2020
Masisa’s sale of two panel mills in Mexico in 2019 was largely responsible for the company posting a large drop in sales revenues in Q3.
The company said its divestment of the Durango and Zitácuaro mills to Arauco specifically resulted in a US$36.6m revenue drop compared to Q3, 2018.
Total revenue from consolidated sales amounted to US$98.2m, which is equivalent to a decrease of US$73.2m compared to the third quarter of 2018.
Other reasons for the reduction include lower forest sales in Chile and Argentina and the deconsolidation of the business in Venezuela.
The Mexican divestments were also the main reason for a US$5m decrease in EBITDA to US$8.8m for the industrial commercial business in Q3.
Masisa has been focusing its efforts to strengthen its commercial strategy and maximise its profitability.
Its divestments of the industrial assets of Argentina, Brazil and two of the three plants in Mexico has allowed it to raise funds of about US$420m, which is expected to complement the sale of forest assets announced to the market.
The forest sale process for assets in Chile and Argentina was announced in April after the company decided that its new business model did not require vertical integration.
“These divestments will allow Masisa to have a more solid balance, which will allow its commercial activity to be focused on businesses with greater added value in the Andean Region, Central America, the US, Canada, Asia and other export markets, maintaining its productive capacity to supply the region from Chile,” the company said.
Masisa said earnings in its industrial commercial business in Chile and its export markets were up slightly due to a growth in wood moulding volumes in the export market (+22.5%) and for the positive impact on EBITDA of the application of IFRS 16.
This increase was partially offset by trade disputes between the US and China that affect the lumber business, by lower volumes of MDF boards in the local market of Chile, Peru, Ecuador and Colombia, and lower average board prices in Peru, Ecuador and Colombia.
Masisa continues to operate a plant in Chihuahua, Mexico consisting of a particleboard line with an installed annual capacity of 220,000m3, melamine coating lines with a total installed annual capacity of 76,000 m3 and three lines of finishes (foils, veneers and kitchen covers).