MEXICO - Sales of Mexican forestry company Proteak, which includes the MDF  (Tecnotabla) and Teak businesses, reached MXN 364.6 million in the third quarter of 2020 (3Q-2020), resulting in a slight increase of 0.4% compared to 3Q-2019 (MXN 363.1 million).

In the MDF business 3Q-2020 sales increased 2.3% compared to 3Q-2019 and export sales represented 8% of total sales. Tecnotabla sales volume stood at 57,339 m3 in 3Q-2020, a record figure representing an increase of 10% vs. 3Q-2019 and 68% vs 2Q-2020. The quarter closed with sales of MXN 327.4 million.

In 3Q-2020 a rebound of local consumption is observed, due to the confinement because of the pandemic, which has promoted the increase of home furniture, renovations and conditioning for the “home office”. In addition to this demand, there is the reactivation of construction projects, which has allowed significant price increases that will take effect in 4Q-2020. In 3Q-2020, Tecnotabla’s market share reached 29% in Natural MDF, and for melamine it reached 35%, 9 p.p. above the end of 2019.

During 3Q-2020 Proteak recorded interest expenses and net bank expenses for MXN 48 million and a favorable exchange result for MXN 43 million. The company's net exposure to exchange rate variations is balanced between the loans denominated in USD and the value of Teak forest assets, whose functional currency is USD. The combination of the above effects results in a net loss after tax for the quarter of MXN 20.4 million.