Tenaris S.A. Q1 FY2025 earnings call

• Change in management: Guillermo Moreno appointed President of US Operations with over 35 years in Tenaris. - Canada: Consolidating Rig Direct strategy with long-term agreements, shipped record quarterly volume of OCTG this winter. - US: Increased deliveries and extended Rig Direct services, working with largest shale operators. - Argentina: Pipe deliveries for new oil export capacity project, expanding fracking and coil tubing service unit. - Offshore: Solid project backlog with opportunities in 2026, recent success in qualifying products for deep water projects, supply line pipe for West African offshore projects. - Australia: Received multi-year award from Chevron for Gorgon and Wheatstone projects. - Middle East: Record quarterly shipments to ADNOC under long-term service agreement, commenced pipe shipment for Algerian gas processing facility.

Fourth quarter sales reached 2.9 billion, down 15% year-on-year but up 3% sequentially. Average selling price in the Tubes operating segment decreased 11% compared to Q4 2024 and 5% sequentially. EBITDA rose 6%, net income in line with previous quarter. EBITDA margin increased slightly to 24% due to better operating performance and higher volumes. Operating cash flow was 821 million, capital expenditure 174 million, free cash flow 647 million. Net cash position increased to 4 billion from 3.6 billion at end of last year.

• If oil price remains near or below $60 per barrel, slowdown in North American shale drilling activity expected, project sanctioning may be delayed. - Expect lower levels of activity ahead but confident in customer portfolio, flexible industrial and supply chain, and solid balance sheet. - Uncertainty in second half of 2025 regarding economic activity and oil demand, but offshore projects and some National Oil Co. programs expected to continue independently of short-term oil price changes.

• Macroeconomic and geopolitical uncertainty fueling expectation of lower economic activity and oil demand. - Oil price below $60 impact on North American shale drilling activity and potential delays in project sanctioning. - Impact of US tariffs on steel imports (70 million per quarter additional tariff impact) and uncertainty on import quotas and administration actions affecting pipe pricing and supply.

Q: Alessandro Pozzi asked about potential slowdown in US activities and recount level by year end.

A: Paolo Rocca said if oil price stabilizes near current levels, oil companies will adjust CapEx, expecting gradual reduction in activity, no major change in Q2 2025, uncertainty in second half with possible reduction in drilling activity in US.

Q: Arun Jayaram asked about US tariffs on steel impact and imports.

A: Paolo Rocca said tariff on steel affects import of steel bars and pipes, estimating 70 million per quarter additional tariff, but price increase in pipe logic expected to offset this. Guillermo Moreno added on import levels and client activity analysis.

Q: David Anderson asked about offshore volumes and activity.

A: Gabriel Podskubka said offshore market is important for Tenaris, with high resilience, examples like Shell Bonga project, and backlog going into 2026, expecting offshore to be resilient.

Q: Sebastian Erskine asked about cost structure and Mexico.

A: Paolo Rocca said labor cost influenced by productivity structuring, and on Mexico, reduced exposure to Pemex but Pemex's situation is deteriorating with low rigs and production, expecting government plan to materialize but timing uncertain.

Q: Derek Podhaizer asked about EBITDA margin target and North America revenue.

A: Paolo Rocca said with oil price below $60, maintaining 20%-25% EBITDA margin difficult in second half, North America revenue strong due to Rig Direct model and resilient portfolio in Canada and US.

Q: Jamie Franklin asked about cost savings and Argentina sales.

A: Paolo Rocca said over half of 200 million cost savings planned by 1H25 recognized, in Argentina mix of products affects prices with pipe logic being a key factor.

Q: Daniel Thomson asked about share buybacks and Argentina.

A: Paolo Rocca said extension of buyback authorization in General Assembly agenda, Board to consider use of cash, and on Argentina, mix of products and rig activity influencing prices.