Tenaris (TEN) Q3 2024 earnings summary

Executive summary

• Q3 2024 sales were $2.9 billion, down 10% year-over-year and 12% sequentially, mainly due to lower prices and demand in the Americas and reduced shipments to Argentina.

• EBITDA for Q3 2024 was $688 million (23.6% margin), up 6% sequentially but down 31% year-over-year, aided by the absence of a prior extraordinary provision.

• Net income for Q3 2024 was $459 million, up 32% sequentially but down 16% year-over-year, reflecting recovery after prior extraordinary provisions.

• Free cash flow for Q3 2024 was $373 million, with a net cash position of $4 billion at quarter-end after $182 million in share buybacks.

• Interim dividend increased by 35% to $0.27 per share (approx. $300 million), and a $700 million share buyback was approved.

Financial highlights

• Nine-month 2024 net sales were $9.68 billion, down 15% year-over-year; EBITDA was $2.33 billion (24% margin), down 40%.

• Net income for the first nine months was $1.56 billion, down 45% year-over-year.

• Free cash flow for the nine months reached $1.86 billion.

• Capital expenditures for the first nine months were $512 million.

• Net cash provided by operating activities was $2.37 billion, a decrease from $3.56 billion in the prior year.

Outlook and guidance

• Q4 2024 sales and EBITDA expected to be lower than Q3, mainly due to reduced sales in Mexico and Saudi Arabia and delayed OCTG pricing impact.

• First quarter 2025 projected to see a 10% rebound in sales and volumes, with margins remaining steady.

• North American activity and prices expected to increase in Q1 2025, driven by customer budget resets and contract rollovers.

• Deepwater Brazil and Guyana/Suriname offshore projects to drive growth into 2025 and 2026.

• Second half 2024 results projected to align with September investor day guidance.