Difficult 2Q-2020 for Proteak due to COVID-19

MEXICO -Proteak, the largest forestry company in Mexico, announced its financial and operating results for the second quarter of 2020 (2Q-2020).

In the 2Q-2020 results were generally affected by a drop in the demand for MDF wooden panels due to the health contingency from COVID-19.

In 2Q-2020 Tecnotabla, the MDF panel manufacturing operation, reached sales of MXN 203 million, a 28.2% drop of against the same period of 2019. In 2Q-2020 Tecnotabla’s volume reached 34,541 m3, a 33% drop compared to the same period of 2019. In 2Q20, the percentage of laminated board sales was 14% and exports to the United States represented 18% of MDF panel sales.

During the period Tecnotabla maintained a solid total market share, positioning itself in second place. The market share in 2Q-2020 was 23% for raw MDF and 29% in laminated MDF.

The COVID-19 pandemic marked a change in the strategy for the Tecnotabla brand in 2Q-2020. Among the many actions, the company developed new melamine designs and new products. In addition, they adapted to the new reality with digital strategies, webinars and "Do It Yourself" tutorials. It also improved the CRM system for telemarketing with samples, activations, training, complaint entries and satisfaction surveys.

In 2Q-2020, consolidated production (MDF panels and teak) was 37% lower than in 2Q-2019 due to the pandemic. The quality factor reached a record 99.2%.

Consolidated EBITDA in 2Q-2020 closed at MXN -20 million vs MXN 29 million in the same period of 2019 and total revenues reached MXN 252 million in 2Q-2020, which represents a drop of 30.8 percent compared to 2Q-2019 (MXN 364 million).