I'm Robert Dietrich. I'm the Chief Financial Officer of Armstrong Fluid Technology. Armstrong is a Toronto-based, family-owned, global manufacturer of heating and cooling equipment, which we call HVAC. That's the term I'll use. Throughout our 80-year history, Armstrong has introduced groundbreaking innovations that have elevated industry practice and substantially improved the quality and performance of pumping and HVAC installations around the world.
For those in the room, this building is heated and cooled through the pumping of water. Quite simply, we pump water through buildings.
With over 1,000 employees worldwide, we operate eight manufacturing facilities on four continents. Armstrong utilizes a global supply chain to ensure consistent quality and performance from our products regardless of the plant's location. This is delivered through a global IT infrastructure and standardized software applications in all of our facilities.
Like most industries, HVAC equipment markets are global, with a small number of dominant players. Armstrong's competitive advantage is built upon innovation, leading our industry in energy efficiency. Armstrong innovations include vertical in-line pumping, integrated motor control, parallel sensorless pumping, and, most recently, Internet connectivity to provide lifetime performance management. All these are industry terms and I don't expect that you would understand them; it's just to illustrate that to be competitive in a global market, you have to be innovative and you need to use technology. These innovations cut across global markets, providing us with a global brand equity.
HVAC plants in buildings such as this are one of the leading consumers of energy in the world. Reduction of this consumption is a primary goal of most countries. This is through modification of the building code or adoption of energy-efficient designs for new construction, and acceleration of replacing energy-obsolete HVAC equipment in the built environment.
Current policies and practices in Mercosur countries, Brazil and Argentina, for example, are insufficient to meet their country's stated climate objectives under the Paris accord. For Armstrong, this indicates an attractive market for retrofitting energy-obsolete HVAC equipment and is one of the drivers for our ongoing investment in Brazil.
Armstrong established a subsidiary in Brazil in 2012 and began operations in 2014. The decision to establish an assembly operation in Brazil was contentious for us, as it added significant overhead to the company. However, duties and customs clearance procedures and local content requirements outweighed our preferred approach of exporting from Canada. Four years later, we have a business with approximately $2.5 million in revenue. We have yet to receive any payback on that investment.
As previously mentioned, Brazil is an ideal market for Armstrong's focus on energy efficiency. Given the slow economic climate in new construction, it is an ideal time to be focusing on energy retrofits. Substantially all of our business in Brazil is from this source of business. Electricity rates in Brazil are higher than we experience in Ontario. This is a favourable environment to encourage energy conservation and abatement through adoption of new technologies. As we bring Brazil to a profitable operation, we will begin to develop business in Argentina with electricity rates similar to those in Canada. Given the climate tracker position of Argentina, as was mentioned earlier, energy abatement will also be attractive in that market.
Armstrong has modelled its business to benefit from freer trade in the world. We create and develop technology in Canada, often utilizing Canadian-based technology suppliers. We first introduce new products into the Canadian market, where we have a strong market position and the customer base is sophisticated. Additionally, governments, including the health care and education sectors, comprise a large segment of the Canadian building landscape and are important reference sites for us to develop international customers.
Armstrong is a strong proponent of Canada's policy of entering into multiple multilateral trade agreements. The benefits for a company of our size are numerous. It enables access to a global supply chain, with the attendant advantages of longer production runs, standardizing on designs, accessing centres of excellence, and attractive competitive costs. It lowers duties and accelerates customs clearance.
It encourages the rationalization of standards and building and electrical codes. It enhances protection of intellectual property and normalizes dispute mechanisms. It often leads to more efficient capital markets, cross-border banking services, and better opportunities to manage customer credit and lower credit risk.
In particular, Armstrong is supportive of negotiations to establish a trade agreement with Mercosur. This will provide us with opportunities to broaden our product offering in Brazil, for example, without having to expand our facilities. We also expect that Brazilian firms could join our global supply chain, reducing our reliance on India and China. Today we import some motors from Brazil from a company called WEG, which is one of the largest motor suppliers in the world. It would also enable us to better support an expansion into other Mercosur countries, leveraging the investment we have already made in other Spanish-speaking countries, such as Mexico and Colombia.
Those are my brief opening comments, and I'd be happy to answer any questions.