Tenaris S.A. (NYSE and Mexico: TS and MTA Italy: TEN) (“Tenaris”)
today announced its results for the quarter ended June 30, 2021 in
comparison with its results for the quarter ended June 30, 2020.
Summary of 2021 Second Quarter
Results
(Comparison with first quarter of 2021 and second quarter of
2020)
|
2Q 2021 |
1Q 2021 |
2Q 2020 |
Net sales ($ million) |
1,529 |
1,182 |
29% |
1,241 |
23% |
Operating income (loss) ($ million) |
152 |
52 |
194% |
(91) |
|
Net income (loss) ($ million) |
290 |
101 |
188% |
(50) |
|
Shareholders’ net income (loss) ($ million) |
294 |
106 |
176% |
(48) |
|
Earnings (losses) per ADS ($) |
0.50 |
0.18 |
176% |
(0.08) |
|
Earnings (losses) per share ($) |
0.25 |
0.09 |
176% |
(0.04) |
|
EBITDA ($ million) |
301 |
196 |
54% |
59 |
414% |
EBITDA margin (% of net sales) |
19.7% |
16.6% |
|
4.7% |
|
Our second quarter sales were up 29%
sequentially, led by a recovery in North and South America but with
sales increasing in all reporting regions. EBITDA, which included
an extraordinary gain of $33 million from the recognition of fiscal
credits in Brazil, continues to recover supported by higher
shipments and an increase in average selling prices that
compensated higher raw material costs. Operating income is
increasing strongly while our net income continues to be boosted by
the contribution from our investments in Ternium and Usiminas.
With the increase in activity levels, working
capital during the quarter rose by $314 million. Cash used in
operating activities totaled $50 million and with capital
expenditures of $51 million during the quarter, our free cash flow
was negative with an outflow of $102 million. After a dividend
payment of $165 million in May 2021, our net cash position declined
to $854 million at June 30, 2021.
Market Background and Outlook
The global economy continues to improve,
although rates of infection from newer and more infectious COVID-19
variants remain high in many parts of the world. Oil prices have
returned to pre-COVID levels as global consumption increases, OPEC+
countries contain production levels and large U.S. shale producers
restrain capital spending. Natural gas prices have also risen.
Seasonally adjusted drilling activity has risen
in the U.S. and Canada in the first half and is expected to
continue to rise in the second half though at a slower pace. In
Latin America, it has risen in the first half and is expected to
consolidate close to current levels. In the Eastern Hemisphere,
drilling activity has started to recover slowly.
We anticipate sales will continue to increase in
the third quarter, led by North and South America but tempered by
ongoing destocking in the Middle East and a seasonal slow down in
Europe. EBITDA margins should reach 20% as price increases and
higher absorption of fixed costs continue to compensate for the
impact of significant cost increases.
Our North American industrial facilities
continue ramping up to meet higher demand. We have hired 700
additional employees in the U.S. since October as we ramped up our
facilities in Bay City and McCarty (TX) to full production and
reopened our facilities in Conroe (TX) and Koppel (PA). We will
reopen our facilities in Ambridge (PA) and Baytown (TX) in August
and expect to hire a further 450 persons by the end of the year. We
are also advancing with our investments to consolidate our Canadian
industrial operations in Sault Ste Marie (ON), where we are now
producing premium products.
Analysis of 2021 Second Quarter Results
Tubes
The following table indicates, for our Tubes business segment,
sales volumes of seamless and welded pipes for the periods
indicated below:
Tubes Sales volume (thousand metric tons) |
2Q 2021 |
1Q 2021 |
2Q 2020 |
Seamless |
611 |
496 |
23% |
446 |
37% |
Welded |
79 |
71 |
10% |
108 |
(27%) |
Total |
690 |
568 |
21% |
554 |
25% |
The following table indicates, for our Tubes business segment,
net sales by geographic region, operating income and operating
income as a percentage of net sales for the periods indicated
below:
Tubes |
2Q 2021 |
1Q 2021 |
2Q 2020 |
(Net sales - $ million) |
|
|
|
|
|
North America |
706 |
514 |
37% |
485 |
45% |
South America |
230 |
166 |
38% |
145 |
58% |
Europe |
170 |
143 |
19% |
169 |
1% |
Middle East & Africa |
228 |
196 |
16% |
308 |
(26%) |
Asia Pacific |
62 |
60 |
4% |
83 |
(24%) |
Total net sales ($ million) |
1,397 |
1,080 |
29% |
1,190 |
17% |
Operating income (loss) ($ million) |
130 |
38 |
243% |
(75) |
|
Operating margin (% of sales) |
9.3% |
3.5% |
|
(6.3%) |
|
Net sales of tubular products and services
increased 29% sequentially and 17% year on year. On a sequential
basis volumes sold increased 21% and average selling prices
increased 6% pulled by higher raw material costs, lower inventory
levels and higher demand. Sales increased in all reporting regions,
particularly in North and South America reflecting a recovery in
drilling activity and higher prices. In North America, we
experienced a strong increase in OCTG sales in the United States,
with higher prices across the region. In South America we had
higher sales in Brazil and Argentina. In Europe we had higher sales
of mechanical products to the industrial sector. In the Middle East
and Africa we had higher sales in the Middle East while sales in
Africa remain low. In Asia Pacific, we had a stable level of sales
across the region.
Operating results from tubular products and
services amounted to a gain of $130 million in the second quarter
of 2021 compared to a gain of $38 million in the previous quarter
and a loss of $75 million in the second quarter of 2020. Operating
results for our Tubes segment included severance charges of $8
million in the quarter, $5 million in the previous quarter and $52
million in the second quarter of 2020. During the quarter operating
results include a $33 million gain related to the recognition of
fiscal credits in Brazil, while in the previous quarter we suffered
$23 million higher costs associated to the Winter Storm Uri. Our
operating margin improved as price increases and a better
industrial performance related to the increase in volumes,
compensate for higher raw material costs.
Others
The following table indicates, for our Others business segment,
net sales, operating income and operating income as a percentage of
net sales for the periods indicated below:
Others |
2Q 2021 |
1Q 2021 |
2Q 2020 |
Net sales ($ million) |
132 |
102 |
29% |
51 |
157% |
Operating income (loss) ($ million) |
21 |
13 |
62% |
(15) |
|
Operating margin (% of sales) |
16.3% |
13.0% |
|
(29.5%) |
|
Net sales of other products and services
increased 29% sequentially and 157% year on year. The sequential
increase in sales is mainly related to higher sales of industrial
equipment in Brazil, higher sales of sucker rods and sales from our
new oil services business in Argentina which offers hydraulic
fracturing and coiled tubing services.
Selling, general and administrative
expenses, or SG&A, amounted to $297
million, or 19.4% of net sales, in the second quarter of 2021,
compared to $255 million, 21.6% in the previous quarter and $286
million, 23.0% in the second quarter of 2020. SG&A expenses
during the quarter included $6 million of leaving indemnities
compared to $3 million in the previous quarter and $26 million in
the second quarter of 2020. Sequentially SG&A increased 16%,
mainly due to higher selling expenses associated with the recovery
in sales.
Other operating results
amounted to a gain of $34 million in the second quarter of 2021,
compared to $8 million gain in the previous quarter and $3 million
loss in the second quarter of 2020. The gain of the quarter is
mainly due to a $33 million recognition of fiscal credits in
Brazil.
Financial results amounted to a
gain of $10 million in the second quarter of 2021, compared to a
gain of $12 million in the previous quarter and a loss of $14
million in the second quarter of 2020. The gain of the quarter
includes a $17 million gain attributable to interests from fiscal
credits in Brazil, which were partially offset by foreign exchange
derivatives results.
Equity in earnings of non-consolidated
companies generated a gain of $146 million in the second
quarter of 2021, compared to a gain of $79 million in the previous
quarter and a gain of $4 million in the second quarter of last
year. These results are mainly derived from our participation in
Ternium (NYSE:TX) and Usiminas, and reflect the good dynamics at
the flat steel sector derived from record high steel prices.
Income tax charge amounted to
$17 million in the second quarter of 2021, compared to $42 million
in the previous quarter and a gain of $49 million in the second
quarter of last year. During the quarter the tax charge includes a
$24 million deferred tax gain, which is mainly explained by the
gain from the revaluation of tax basis in Italy and Argentina,
partially offset by a tax rate increase in Argentina.
Cash Flow and Liquidity of 2021 Second
Quarter
Net cash used in operating activities during the
second quarter of 2021 was $50 million, compared to $70 million
generated in the first quarter of 2021 and $448 million generated
in the second quarter of last year. During the second quarter of
2021 cash used in working capital amounted to $314 million.
With capital expenditures of $51 million, we had
a negative free cash flow of $102 million during the quarter. After
a dividend payment of $165 million in May 2021, our net cash
position amounted to $854 million at June 30, 2021, from $1.1
billion at March 31, 2021.
Analysis of 2021 First Half Results
|
6M 2021 |
6M 2020 |
Increase/(Decrease) |
Net sales ($ million) |
2,710 |
3,003 |
(10%) |
Operating income (loss) ($ million) |
203 |
(600) |
134% |
Net income (loss) ($ million) |
391 |
(716) |
155% |
Shareholders’ net income (loss) ($ million) |
400 |
(708) |
157% |
Earnings (losses) per ADS ($) |
0.68 |
(1.20) |
157% |
Earnings (losses) per share ($) |
0.34 |
(0.60) |
157% |
EBITDA ($ million) |
497 |
338 |
47% |
EBITDA margin (% of net sales) |
18.4% |
11.3% |
|
Our sales in the first half of 2021 decreased
10% compared to the first half of 2020 as volumes of tubular
products shipped declined 9% and average selling prices declined 4%
while an increase in the Others segment partially compensates the
decline. Despite the reduction in sales, EBITDA increased by $159
million in the first half of 2021 compared to a year ago, as our
industrial performance improved due to a more efficient utilization
of production capacity as activity levels recovered, lower
structural costs and severance charges, which declined steeply from
$77 million in the first half of 2020 to $14 million in the first
half of 2021. Additionally, during the first six months of 2021 we
had a $34 million gain from the recognition of fiscal credits in
Brazil, partially offset by $23 million higher costs associated to
the Winter Storm Uri. Operating income amounted to $203 million in
the first six months of 2021 compared to a net loss of $600 million
a year ago, which included an impairment charge of $622 million.
Net income in the first six months of 2021 benefited from a $225
million gain from our equity participations, mainly Ternium.
Cash flow provided by operating activities
amounted to $20 million during the first half of 2021, including an
increase in working capital of $397 million, which reflects the
recovery in activity levels. After capital expenditures of $97
million, we had a negative free cash flow of $76 million. Following
a dividend payment of $165 million in May 2021, our positive net
cash position amounted to $854 million at the end of June 2021.
The following table shows our net sales by business segment for
the periods indicated below:
Net sales ($ million) |
6M 2021 |
|
6M 2020 |
|
Increase/(Decrease) |
Tubes |
2,476 |
91% |
2,848 |
95% |
(13%) |
Others |
234 |
9% |
155 |
5% |
51% |
Total |
2,710 |
|
3,003 |
|
(10%) |
Tubes
The following table indicates, for our Tubes business segment,
sales volumes of seamless and welded pipes for the periods
indicated below:
Tubes Sales volume (thousand metric tons) |
6M 2021 |
6M 2020 |
Increase/(Decrease) |
Seamless |
1,108 |
1,111 |
0% |
Welded |
150 |
278 |
(46%) |
Total |
1,258 |
1,389 |
(9%) |
The following table indicates, for our Tubes business segment,
net sales by geographic region, operating income and operating
income as a percentage of net sales for the periods indicated
below:
Tubes |
6M 2021 |
6M 2020 |
Increase/(Decrease) |
(Net sales - $ million) |
|
|
|
North America |
1,220 |
1,364 |
(11%) |
South America |
396 |
370 |
7% |
Europe |
314 |
303 |
4% |
Middle East & Africa |
424 |
638 |
(34%) |
Asia Pacific |
122 |
173 |
(29%) |
Total net sales ($ million) |
2,476 |
2,848 |
(13%) |
Operating income (loss) ($ million) |
169 |
(553) |
|
Operating margin (% of sales) |
6.8% |
(19.4%) |
|
Net sales of tubular products and services
decreased 13% to $2,476 million in the first half of 2021, compared
to $2,848 million in the first half of 2020 due to a reduction of
9% in volumes and a 4% decrease in average selling prices. Sales
decreased in the Middle East & Africa region, in Asia Pacific
and in North America, partially compensated by an increase in South
America and Europe. Average drilling activity in the first half of
2021 declined 25% both in the United States & Canada and
internationally compared to the first half of 2020.
Operating results from tubular products and
services amounted to a gain of $169 million in the first half of
2021 compared to a loss of $553 million in the first half of 2020.
Tubes operating results in the first six months of 2020 were
affected by $75 million of severance charges and by an impairment
charge of $582 million. In the first six months of 2021 Tubes
operating results were negatively affected by $13 million of
severance charges but they benefited from a $34 million gain from
the recognition of fiscal credits in Brazil, partially offset by
$23 million higher costs associated to the Winter Storm Uri.
Despite the reduction in sales our industrial performance improved
due to the increased utilization of production capacity.
Others
The following table indicates, for our Others business segment,
net sales, operating income and operating income as a percentage of
net sales for the periods indicated below:
Others |
6M 2021 |
6M 2020 |
Increase/(Decrease) |
Net sales ($ million) |
234 |
155 |
51% |
Operating income (loss) ($ million) |
35 |
(47) |
174% |
Operating margin (% of sales) |
14.8% |
(30.0%) |
|
Net sales of other products and services
increased 51% to $234 million in the first half of 2021, compared
to $155 million in the first half of 2020, mainly due to higher
sales of excess raw materials, pipes for plumbing applications in
Italy and industrial equipment in Brazil.
Operating results from other products and
services amounted to a gain of $35 million in the first half of
2021, compared to a loss of $47 million in the first half of 2020.
Results in the first six months of 2020 were affected by an
impairment charge of $40 million related to sucker rods and coiled
tubing businesses. The improvement in operating results is mainly
driven by the increase in sales following a recovery in activity
and in the level of capacity utilization of our production
facilities.
Selling, general and administrative
expenses, or SG&A, amounted to $552 million in the
first half of 2021, representing 20.4% of sales, and $643 million
in the first half of 2020, representing 21.4% of sales. During the
first half of 2021 SG&A includes $8 million of severance
charges, compared to $36 million in the first half of 2020. Apart
from leaving indemnities main SG&A reductions were in selling
expenses related to the reduction in sales, in services and fees
and in amortizations of intangible assets.
Other operating results
amounted to a gain of $42 million in the first half of 2021,
compared to a loss of $2 million in the first half of 2020. The
gain in 2021 is mainly due to a $34 million recognition of fiscal
credits in Brazil.
Financial results amounted to a
gain of $21 million in the first half of 2021, compared to a loss
of $36 million in the first half of 2020. The $17 million net
finance income in the first six months of 2021 includes a $17
million gain attributable to interests from fiscal credits in
Brazil. Additionally, in the first half of 2021 we had a $5 million
foreign exchange gain net of foreign exchange-derivative results,
which is mainly related to the Euro depreciation on Euro
denominated intercompany liabilities in subsidiaries with
functional currency U.S. dollar and the Brazilian real appreciation
on U.S. dollar denominated intercompany liabilities in subsidiaries
with functional currency Brazilian real, both largely offset in the
currency translation reserve in equity.
Equity in earnings of non-consolidated
companies generated a gain of $225 million in the first
half of 2021, compared to a gain of $6 million in the first half of
2020. These results are mainly derived from our participation in
Ternium (NYSE:TX) and Usiminas, and currently reflect the good
dynamics at the flat steel sector derived from record high steel
prices.
Income tax amounted to a charge
of $59 million in the first half of 2021, compared to $86 million
in the first half of 2020.
Cash Flow and Liquidity of 2021 First Half
Net cash provided by operating activities during
the first half of 2021 amounted to $20 million (including an
increase in working capital of $397 million), compared to cash
provided by operations of $964 million (including a reduction in
working capital of $763 million) in the first half of 2020. Working
capital, mainly inventories and trade receivables, increased in the
first half of 2021 following the recovery in activity from very low
levels in the second half of 2020.
Capital expenditures amounted to $97 million in
the first half of 2021, compared to $114 million in the first half
of 2020. Negative free cash flow amounted to $76 million in the
first half of 2021, compared to a positive free cash flow of $850
million in the first half of 2020.
After a dividend payment of $165 million in May
2021, our net cash position amounted to $854 million at June 30,
2021, from $1.1 billion at December 31, 2020.
Tenaris Files Half-Year Report
Tenaris S.A. announces that it has filed its
half-year report for the six-month period ended June 30, 2021 with
the Luxembourg Stock Exchange. The half-year report can be
downloaded from the Luxembourg Stock Exchange’s website at
www.bourse.lu and from Tenaris’s website at ir.tenaris.com.
Holders of Tenaris’s shares and ADSs, and any
other interested parties, may request a hard copy of the half-year
report, free of charge, at 1-888-300-5432 (toll free from the
United States) or 52-229-989-1159 (from outside the United
States).
Conference call
Tenaris will hold a conference call to discuss
the above reported results, on August 5, 2021, at 10:00 a.m.
(Eastern Time). Following a brief summary, the conference call will
be opened to questions. To access the conference call dial in +1
866 789 1656 within North America or +1 630 489 1502
Internationally. The access number is “9397370”. Please dial in 10
minutes before the scheduled start time. The conference call will
be also available by webcast at
ir.tenaris.com/events-and-presentations
A replay of the conference call will be
available on our webpage http://ir.tenaris.com/ or by phone from
1.00 pm ET on August 5 through 1.00 pm on August 13, 2021. To
access the replay by phone, please dial +1 855 859 2056 or +1 404
537 3406 and enter passcode “9397370” when prompted.
Some of the statements contained in this press
release are “forward-looking statements”. Forward-looking
statements are based on management’s current views and assumptions
and involve known and unknown risks that could cause actual
results, performance or events to differ materially from those
expressed or implied by those statements. These risks include but
are not limited to risks arising from uncertainties as to future
oil and gas prices and their impact on investment programs by oil
and gas companies.Consolidated Condensed Interim Income
Statement
(all amounts in thousands of U.S. dollars) |
Three-month period ended June 30, |
Six-month period ended June 30, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
Continuing operations |
Unaudited |
Unaudited |
Net sales |
1,528,511 |
|
1,241,045 |
|
2,710,300 |
|
3,003,356 |
|
Cost of sales |
(1,113,782 |
) |
(1,042,322 |
) |
(1,996,781 |
) |
(2,335,987 |
) |
Gross profit |
414,729 |
|
198,723 |
|
713,519 |
|
667,369 |
|
Selling, general and administrative expenses |
(296,785 |
) |
(285,964 |
) |
(551,811 |
) |
(643,009 |
) |
Impairment Charge |
- |
|
- |
|
- |
|
(622,402 |
) |
Other operating income (expense), net |
33,750 |
|
(3,354 |
) |
41,577 |
|
(2,098 |
) |
Operating income (loss) |
151,694 |
|
(90,595 |
) |
203,285 |
|
(600,140 |
) |
Finance Income |
21,517 |
|
3,792 |
|
27,215 |
|
5,669 |
|
Finance Cost |
(5,831 |
) |
(7,418 |
) |
(10,506 |
) |
(15,860 |
) |
Other financial results |
(6,074 |
) |
(9,894 |
) |
4,680 |
|
(25,636 |
) |
Income (loss) before equity in earnings of non-consolidated
companies and income tax |
161,306 |
|
(104,115 |
) |
224,674 |
|
(635,967 |
) |
Equity in earnings of non-consolidated companies |
145,829 |
|
4,406 |
|
224,970 |
|
6,295 |
|
Income (loss) before income tax |
307,135 |
|
(99,709 |
) |
449,644 |
|
(629,672 |
) |
Income tax |
(16,953 |
) |
49,402 |
|
(58,697 |
) |
(86,367 |
) |
Income (loss) for the period |
290,182 |
|
(50,307 |
) |
390,947 |
|
(716,039 |
) |
|
|
|
|
|
Attributable to: |
|
|
|
|
Owners of the parent |
293,940 |
|
(47,961 |
) |
400,286 |
|
(708,029 |
) |
Non-controlling interests |
(3,758 |
) |
(2,346 |
) |
(9,339 |
) |
(8,010 |
) |
|
290,182 |
|
(50,307 |
) |
390,947 |
|
(716,039 |
) |
Consolidated Condensed Interim Statement of Financial
Position
(all amounts in thousands of
U.S. dollars) |
At June 30, 2021 |
|
At December 31, 2020 |
|
Unaudited |
|
|
ASSETS |
|
|
|
|
|
Non-current assets |
|
|
|
|
|
Property, plant and equipment, net |
6,024,114 |
|
|
6,193,181 |
|
Intangible assets, net |
1,404,265 |
|
|
1,429,056 |
|
Right-of-use assets, net |
224,514 |
|
|
241,953 |
|
Investments in non-consolidated companies |
1,144,191 |
|
|
957,352 |
|
Other investments |
292,162 |
|
|
247,082 |
|
Deferred tax assets |
239,384 |
|
|
205,590 |
|
Receivables, net |
211,869 |
9,540,499 |
|
154,303 |
9,428,517 |
Current assets |
|
|
|
|
|
Inventories, net |
2,145,560 |
|
|
1,636,673 |
|
Receivables and prepayments, net |
85,989 |
|
|
77,849 |
|
Current tax assets |
179,942 |
|
|
136,384 |
|
Trade receivables, net |
1,093,496 |
|
|
968,148 |
|
Derivative financial instruments |
7,234 |
|
|
11,449 |
|
Other investments |
573,679 |
|
|
872,488 |
|
Cash and cash equivalents |
587,337 |
4,673,237 |
|
584,681 |
4,287,672 |
Total assets |
|
14,213,736 |
|
|
13,716,189 |
EQUITY |
|
|
|
|
|
Capital and reserves attributable to owners of the parent |
|
11,485,222 |
|
|
11,262,888 |
Non-controlling interests |
|
178,485 |
|
|
183,585 |
Total equity |
|
11,663,707 |
|
|
11,446,473 |
LIABILITIES |
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
Borrowings |
290,071 |
|
|
315,739 |
|
Lease liabilities |
189,386 |
|
|
213,848 |
|
Deferred tax liabilities |
283,190 |
|
|
254,801 |
|
Other liabilities |
240,923 |
|
|
245,635 |
|
Provisions |
84,327 |
1,087,897 |
|
73,218 |
1,103,241 |
Current liabilities |
|
|
|
|
|
Borrowings |
310,344 |
|
|
303,268 |
|
Lease liabilities |
40,994 |
|
|
43,495 |
|
Derivative financial instruments |
3,503 |
|
|
3,217 |
|
Current tax liabilities |
82,814 |
|
|
90,593 |
|
Other liabilities |
246,040 |
|
|
202,826 |
|
Provisions |
10,768 |
|
|
12,279 |
|
Customer advances |
37,580 |
|
|
48,692 |
|
Trade payables |
730,089 |
1,462,132 |
|
462,105 |
1,166,475 |
Total liabilities |
|
2,550,029 |
|
|
2,269,716 |
Total equity and liabilities |
|
14,213,736 |
|
|
13,716,189 |
Consolidated Condensed Interim Statement of Cash
Flows
|
Three-month period ended June 30, |
Six-month period ended June 30, |
(all amounts in thousands of U.S. dollars) |
2021 |
|
2020 |
|
2021 |
|
2020 |
|
Cash flows from operating activities |
Unaudited |
Unaudited |
|
|
|
|
|
Income (loss) for the period |
290,182 |
|
(50,307 |
) |
390,947 |
|
(716,039 |
) |
Adjustments for: |
|
|
|
|
Depreciation and amortization |
149,627 |
|
149,203 |
|
294,096 |
|
316,180 |
|
Impairment charge |
- |
|
- |
|
- |
|
622,402 |
|
Income tax accruals less payments |
(12,658 |
) |
(88,553 |
) |
(567 |
) |
(2,295 |
) |
Equity in earnings of non-consolidated companies |
(145,829 |
) |
(4,406 |
) |
(224,970 |
) |
(6,295 |
) |
Interest accruals less payments, net |
(12,001 |
) |
(1,765 |
) |
(12,047 |
) |
1,371 |
|
Changes in provisions |
5,562 |
|
(291 |
) |
9,598 |
|
(11,781 |
) |
Changes in working capital |
(313,764 |
) |
446,069 |
|
(397,090 |
) |
763,040 |
|
Currency translation adjustment and others |
(11,472 |
) |
(2,371 |
) |
(39,826 |
) |
(2,926 |
) |
Net cash (used in) provided by operating
activities |
(50,353 |
) |
447,579 |
|
20,141 |
|
963,657 |
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
Capital expenditures |
(51,274 |
) |
(45,541 |
) |
(96,565 |
) |
(113,585 |
) |
Changes in advance to suppliers of property, plant and
equipment |
(2,624 |
) |
544 |
|
(5,728 |
) |
117 |
|
Acquisition of subsidiaries, net of cash acquired |
- |
|
- |
|
- |
|
(1,063,848 |
) |
Proceeds from disposal of property, plant and equipment and
intangible assets |
416 |
|
647 |
|
5,339 |
|
1,165 |
|
Dividends received from non-consolidated companies |
49,131 |
|
278 |
|
49,131 |
|
278 |
|
Changes in investments in securities |
65,991 |
|
(286,733 |
) |
242,923 |
|
(255,439 |
) |
Net cash provided by (used in) investing
activities |
61,640 |
|
(330,805 |
) |
195,100 |
|
(1,431,312 |
) |
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
Dividends paid |
(165,275 |
) |
- |
|
(165,275 |
) |
- |
|
Dividends paid to
non-controlling interest in subsidiaries |
(3,207 |
) |
- |
|
(3,207 |
) |
- |
|
Changes in non-controlling
interests |
- |
|
1 |
|
- |
|
2 |
|
Payments of lease
liabilities |
(10,404 |
) |
(9,982 |
) |
(26,304 |
) |
(24,943 |
) |
Proceeds from borrowings |
191,515 |
|
223,090 |
|
286,120 |
|
442,248 |
|
Repayments of borrowings |
(135,617 |
) |
(256,628 |
) |
(303,888 |
) |
(571,122 |
) |
Net cash (used in) financing activities |
(122,988 |
) |
(43,519 |
) |
(212,554 |
) |
(153,815 |
) |
|
|
|
|
|
(Decrease) Increase in cash and cash
equivalents |
(111,701 |
) |
73,255 |
|
2,687 |
|
(621,470 |
) |
Movement in cash and cash equivalents |
|
|
|
|
At the beginning of the
period |
695,127 |
|
839,864 |
|
584,583 |
|
1,554,275 |
|
Effect of exchange rate
changes |
1,813 |
|
(2,221 |
) |
(2,031 |
) |
(21,907 |
) |
(Decrease) Increase in cash
and cash equivalents |
(111,701 |
) |
73,255 |
|
2,687 |
|
(621,470 |
) |
|
585,239 |
|
910,898 |
|
585,239 |
|
910,898 |
|
Exhibit I – Alternative performance
measures
EBITDA, Earnings before interest, tax, depreciation and
amortization.
EBITDA provides an analysis of the operating
results excluding depreciation and amortization and impairments, as
they are non-cash variables which can vary substantially from
company to company depending on accounting policies and the
accounting value of the assets. EBITDA is an approximation to
pre-tax operating cash flow and reflects cash generation before
working capital variation. EBITDA is widely used by investors when
evaluating businesses (multiples valuation), as well as by rating
agencies and creditors to evaluate the level of debt, comparing
EBITDA with net debt.
EBITDA is calculated in the following manner:
EBITDA= Operating results + Depreciation and amortization +
Impairment charges/(reversals).
(all amounts in thousands of U.S. dollars) |
Three-month period ended June 30, |
Six-month period ended June 30, |
|
2021 |
2020 |
|
2021 |
2020 |
|
Operating income (Loss) |
151,694 |
(90,595 |
) |
203,285 |
(600,140 |
) |
Depreciation and
amortization |
149,627 |
149,203 |
|
294,096 |
316,180 |
|
Impairment |
- |
- |
|
- |
622,402 |
|
EBITDA |
301,321 |
58,608 |
|
497,381 |
338,442 |
|
Free Cash Flow
Free cash flow is a measure of financial performance, calculated
as operating cash flow less capital expenditures. FCF represents
the cash that a company is able to generate after spending the
money required to maintain or expand its asset base.
Free cash flow is calculated in the following manner:
Free cash flow = Net cash (used in) provided by operating
activities - Capital expenditures.
(all amounts in thousands of U.S. dollars) |
Three-month period ended June 30, |
Six-month period ended June 30, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
Net cash (used in) provided by
operating activities |
(50,353 |
) |
447,579 |
|
20,141 |
|
963,657 |
|
Capital expenditures |
(51,274 |
) |
(45,541 |
) |
(96,565 |
) |
(113,585 |
) |
Free cash
flow |
(101,627 |
) |
402,038 |
|
(76,424 |
) |
850,072 |
|
Net Cash / (Debt)
This is the net balance of cash and cash
equivalents, other current investments and fixed income investments
held to maturity less total borrowings. It provides a summary of
the financial solvency and liquidity of the company. Net cash /
(debt) is widely used by investors and rating agencies and
creditors to assess the company’s leverage, financial strength,
flexibility and risks.
Net cash/ debt is calculated in the following manner:
Net cash= Cash and cash equivalents + Other investments (Current
and Non-Current)+/- Derivatives hedging borrowings and investments–
Borrowings (Current and Non-Current).
(all amounts in thousands of U.S. dollars) |
At June 30, |
|
2021 |
|
2020 |
|
Cash and cash equivalents |
587,337 |
|
910,957 |
|
Other current investments |
573,679 |
|
445,217 |
|
Non-current investments |
286,264 |
|
36,516 |
|
Derivatives hedging borrowings
and investments |
6,833 |
|
(23,458 |
) |
Current borrowings |
(310,344 |
) |
(467,115 |
) |
Non-current borrowings |
(290,071 |
) |
(231,799 |
) |
Net cash /
(debt) |
853,698 |
|
670,318 |
|
Giovanni
Sardagna Tenaris
1-888-300-5432www.tenaris.com
Tenaris (BIT:TEN)
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