Increasing operational efficiency and resuming operation in the markets served by the Company brought significant growth
JOINVILLE, Brazil, Oct. 28, 2020 /PRNewswire/ -- Tupy ends the third quarter of 2020 with net revenue of BRL 1,250 million, a growth of 94% when compared to 2Q20, when the crisis reached its peak. The recovery that started in June made the Company reach a gross operational profit of BRL 282 million with a gross margin of 23%, and a net profit of BRL 128 million (growth of 93% when compared to 3Q19) - the highest figures ever achieved. EBITDA also broke record with BRL 249 million and a margin of 20%. Adjusted EBITDA achieved BRL 257 million with a margin of 21%.
This result has been achieved by revisiting essential processes and strengthening the Tupy Production System (TPS), which are now enabled by a new management team and other personnel who brought in their expertise from other markets. Other actions taken include redesigning flows, applying data analytics to identify the best mix of raw materials, stoppage of less efficient equipment, besides meaningful changes to the procurement process by applying the best worldwide practices. In Mexico, margins improved significantly and machine operations, which began in 2019, overcame the ramp up and going past the learning curve, collaborate even further with the profitability of the Company. All such initiatives have been carried out to increase the operational effectiveness of the Company.
Cash generation achieved BRL 152 million in that term, showing a growth of 28% when compared to the previous year. Therefore, the Company cash position of the Company was at BRL 1,434 million in September.
"The figures we bring this quarter are the result of two key bedrocks: people and processes. Increasing interaction and synergy among the areas prove to be relevant in undertaking structural changes. The initiatives that have been enforced in all plants made the Company more efficient and qualified to adapt operations to the changes of volumes and ready to grow", says Tupy CEO Fernando Cestari de Rizzo.
The role of innovation in operational effectiveness
The adoption of new technologies that apply the concept of open innovation already in deployment for product development has also been expanded. For instance, the development of complex mathematical models that support metallurgy engineering area to optimizing the combination of material and equipment parameters, so as to turn them more technically and economically efficient. Another project currently tested applies artificial intelligence to analyze multiple variables, predictively identify any non-compliances in the process, and suggest the improvements required.
Role in the community and efforts against COVID-19
The Company continues with a strict safety protocol within all the plants, besides keeping at home approximately 600 people identified as members of the risk group, as well as female parents of children with ages up to 10. In the communities of both Brazil and Mexico, donations have been made to entities directly involved in health care. The Screening and Testing Center built on the recreational facilities of Tupy, in Joinville, Brazil, has provided care for more than 20 thousand people, directly supporting the Brazilian public health system against an overload.
Brazilian multinational company that develops and produces structural components built in cast iron with highly complexity geometrics and metallurgy. Such engineering solutions are applied to sectors that include transport, infrastructure, agribusiness, and the power industry, and contribute to the quality of life of the large public by supporting the access to health care, basic sanitation, drinkable water, food production and distribution, and to the international market. The technical innovation involved in producing and creating those solutions rests in the Company's expertise attained through more than 80 years of history. The production is mainly based on Brazilian plants located in Joinville-SC and Mauá-SP, and abroad, in the cities of Saltillo and Ramos Arizpe in Mexico. In addition, the Company holds business offices in São Paulo, USA, and Germany.