Tubacex (TUB) Q3 2024 earnings summary

Executive summary

• Strategic agreement with Mubadala Investment closed, bringing €182.1M cash inflow, reducing net financial debt, and boosting OCTG business.

• Q3 2024 delivered the highest quarterly EBITDA of the year at €28M, with a margin of 16.4%.

• Sales for 9M 2024 reached €569.1M, down 11.4% year-over-year, with EBITDA €78.1M (13.7% margin), and net profit €14.2M (down 48.9%).

• Backlog remains robust at €1.6B, concentrated in high value-added products, providing strong visibility for 2025.

• ADNOC project manufacturing commenced; Abu Dhabi plant to be commissioned in Q4, with capex reaching €48.2M.

Financial highlights

• 9M 2024 sales declined 11.4% year-over-year to €569.1M; Q3 sales down 17.4% to €171.1M.

• EBITDA for 9M 2024 was €78.1M (down 16.8% year-over-year); Q3 EBITDA €28M (down 5%).

• EBIT for 9M 2024 was €45.8M (8.0% margin), net profit €14.2M (2.5% margin), both down year-over-year.

• Net financial debt reduced to €260.7M post-Mubadala, from €442.8M at September-end.

• Working capital increased to €328.4M (42.1% of sales), mainly due to ADNOC project investments and inventory for future projects.

Outlook and guidance

• Progressive improvement in results and margins expected in Q4 and into 2025.

• ADNOC project and Abu Dhabi plant expected to drive significant growth in 2025 and 2026.

• NT2 2027 plan targets revenue of €1.2–1.4B, EBITDA above €200M, and NFD/EBITDA below 2x.

• Abu Dhabi plant billing for a major order set to begin in 2025, expected to drive further deleveraging.