Tenaris Profit Jumps as Oil Drilling Boosts Demand for Pipes
Tenaris SA (TS), the world’s largest maker of seamless steel pipes, said fourth-quarter profit rose 25 percent, beating analyst estimates, on increased demand from oil and natural-gas explorers and higher prices.
Net income attributable to shareholders rose to $399.6 million, or 34 cents per American depositary receipt, from $320.9 million, or 27 cents, a year earlier, the Luxembourg- based company said today in a statement. Tenaris was expected to post profit of $383.9 million, excluding some items, the average of nine analysts’ estimates compiled by Bloomberg. (TEN)
Increasing oil drilling in North America, Tenaris’s biggest market, and in other regions stoked demand for the company’s products. The average number of active U.S. oil and gas rigs rose 18 percent to 2,007 in the year through Dec. 30, according to Baker Hughes Inc. (BHI) Average selling prices rose 11 percent in the quarter, Tenaris said.
“In most places around the world, oil and gas activity increased over the course of 2011,” said Christian Reos, an analyst at brokerage Allaria Ledesma & Cia. in Buenos Aires, before the results were announced. Sales volume rose “above all in seamless pipes, with higher prices across all areas of the business.”
Net sales climbed 33 percent to $2.75 billion. Sales in North America gained 36 percent to $1.17 billion. In South America and Europe sales rose 33 percent and 30 percent, respectively.
Tenaris declined 1.4 percent to 15.47 euros in Milan, after rising as much as 2.9 percent earlier today. The stock dropped 9.1 percent in the last 12 months.
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