Vallourec Drops in Paris on Second-Half Profit Goal Cut
Vallourec SA (VK), a French producer of steel pipes for the oil and gas industry, declined the most in more than a month in Paris after cutting its forecast for second-half profit.
Vallourec fell as much as 10 percent, the steepest intraday decline since Aug. 18.
Second-half earnings before interest, tax, depreciation and amortization will be at a similar level to the first six months of the year, the company said today in a statement. Vallourec forecast in July that Ebitda would be “slightly” higher in the second half versus the first.
Valloure cited the “cautious attitude of the distributors in non-energy markets as a consequence of economic uncertainties” and currency movements for the forecast cut.
Boulogne Billancourt, France-based Vallourec said last month that the cost of steelmaking ingredients such as iron ore was crimping margins. High raw material costs and weak demand are hobbling steel-product makers’ efforts to emerge from the industry’s worst crisis in 60 years following the financial crisis.
Vallourec traded 2.11 euros lower at 41.87 euros as of 9:30 a.m. in Paris.
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