Tenaris Profit Gains on Rising North America Drilling

Tenaris SA, the world’s largest maker of seamless pipes, said third-quarter profit gained 33 percent as energy companies boosted drilling in North America.

Net income rose to $304.8 million, or 52 cents per American depositary receipt, from $229.9 million, or 39 cents, a year earlier, the Luxembourg-based company said today in a statement.

Revenue from North America, Tenaris’s biggest market, climbed 65 percent to $848.7 million, while sales in the Middle East and Africa fell 6 percent. Rising oil and gas prices spurred energy producers to complete 123 U.S. wells a day during the July through September period, a 45 percent increase from a year earlier, the American Petroleum Institute said Oct. 26.

“Under these market conditions, we expect revenues and operating income to increase gradually in the fourth quarter and more strongly in the first half of 2011,” Tenaris said.

Sales in Mexico declined in the quarter because of reduced activity at Chicontepec and Burgos and hurricane disruptions, Tenaris said.

North America is a leading performer this quarter for Tenaris “because it starts off from a very low point from last year,” Christian Reos, an analyst with brokerage Allaria Ledesma said in a Nov. 1 telephone interview. “Volumes and prices are up” as activity improves in the region, he said.

Tenaris rose 92 cents, or 2.2 percent, to close at $43.46 at 5:15 p.m. in New York Stock Exchange composite trading. The earnings report was released after the close of regular trading in North American markets. The shares have climbed 10 percent in the past year.

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