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Tenaris' 2024 Q4 & Full Year Financials: Decline in Revenue, Resilient Performance Amidst Challenges

Synopsis: Tenaris, a leader in tubular products and services, has announced its financial results for Q4 2024 and the entire year. The company saw a decrease in net sales by 16% year-over-year, with challenges such as lower demand in key markets like North America and the Middle East. Despite a drop in revenue, the company showcased resilience in its operations, especially in the Middle East and South America, and experienced a slight increase in operating income compared to Q3 2024.
Monday, February 24, 2025
OCTG
Source : ContentFactory

Key Aspects of Tenaris' 2024 Fourth Quarter Results

Tenaris S.A., a global manufacturer of steel pipes and related services, has shared its performance for the fourth quarter of 2024 and the entire year, covering a variety of financial and operational metrics. Despite a drop in revenue, Tenaris continues to showcase strong operational dynamics in certain markets, including the Middle East and South America, while facing challenges in North America and Asia Pacific.

Tubes Business Segment Overview:

In the Tubes business segment, which includes seamless and welded pipes, Tenaris experienced varied results:

• Seamless pipes sales volumes remained almost unchanged, with a marginal decrease of 2% compared to Q4 2023.

• Welded pipes sales volumes saw a significant drop of 33% compared to the same period in 2023.

In total, Tubes sales volume decreased by 9% year-over-year and 3% sequentially, driven largely by reduced demand in key markets.

Geographic Breakdown of Tubes Business:

• North America faced a substantial decline in sales of 25% compared to Q4 2023, primarily due to lower prices and reduced activity in Mexico.

• South America showed some growth with a 1% increase in sales, driven by strong performance in Brazil.

• Europe saw a 13% increase in sales, aided by pipeline projects and robust sales in Turkey.

• Asia Pacific, Middle East, and Africa experienced a 22% decline in sales, mainly due to lower activity in Saudi Arabia.

Despite the drop in sales, operating income from tubular products was $533 million, slightly improved from $527 million in Q3 2024. However, operating income declined by 32% compared to Q4 2023, mainly due to falling prices and a costlier product mix.

Overall Q4 Financial Performance:

• Net sales for Q4 2024 were $2.8 billion, a decline of 16% year-over-year, with a slight 2% drop compared to Q3 2024.

• Operating income stood at $558 million, a 4% increase from Q3 2024 but a 32% decrease from Q4 2023.

• Net income increased by 13% sequentially to $519 million, but decreased by 55% compared to the previous year.

Annual Performance:

• For the full year 2024, Tenaris' net sales dropped by 16% to $12.5 billion, primarily due to a decline in market prices and lower demand in key regions.

• Operating income for 2024 was $2.4 billion, marking a 44% decrease compared to 2023.

• Net income for 2024 amounted to $2.1 billion, a decrease of 48% compared to the previous year.

Despite these setbacks, the company achieved a strong free cash flow of $310 million for Q4 2024, and its net cash position stood at $3.6 billion by the end of the year.

Key Takeaways:

• Seamless pipe volumes showed a slight decline of 2% YoY, while welded pipe volumes plummeted by 33%.

• North America and Asia Pacific faced significant declines in sales due to reduced activity and lower prices.

• South America and Europe showed resilience, with South America having higher sales in Brazil and Europe benefiting from key projects.

• Net sales in Q4 2024 decreased by 16% YoY, totaling $2.8 billion.

• Operating income for Q4 was $533 million, a 1% increase from Q3 2024, but a sharp drop from the previous year.

• Net income decreased by 55% YoY, totaling $519 million in Q4 2024.

• Free cash flow was $310 million, with a net cash position of $3.6 billion at year-end.

• For the full year 2024, net sales dropped by 16%, totaling $12.5 billion, while operating income decreased by 44% to $2.4 billion.

• The EBITDA margin for Q4 2024 was 25.5%, a decline from 28.6% in Q4 2023, reflecting lower demand and price drops.