Tenaris S.a. · MIL:TEN
Tenaris — Investor Day (March 2007)
16 slides from Tenaris's investor day presentation, Mar 8, 2007
Slide 1: Investor Day - 2007
Investor Day - 2007 Paolo Rocca – Chairman and CEO March 8, 2007
Slide 2: Disclaimer
Disclaimer This presentation contains “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 th
Slide 3: Company focused on energy
Company focused on energy Net sales – 2003 Q4 Net sales – 2006 Q4 Tubes Industrial Tubes Industrial 9% Others Industrial 16% 6% Others Industrial Others Energy 4% 1% Others Energy Projects Energy 1% 7% Projects Energy 5% Tubes Energy 74% Tubes Energy 77% US$0.7 bn US$2.5 bn 2007 Investor Day Tenaris
Slide 4: Expanding in North America
Expanding in North America Net sales – 2003 Q4 Net sales – 2006 Q4 Far East & Oceania Far East & Oceania 6% 11% North America Middle East & Africa 30% North America Middle East & Africa 12% 36% 25% Europe 23% Europe South America South America 16% 24% 17% 2007 Investor Day Tenaris 4
Slide 5: Oil and gas: demand growing and reserves not being replaced
Oil and gas: demand growing and reserves not being replaced • Global demand for oil and gas continues to grow • But discovery of new reserves is falling further and further behind 60 50 40 30 20 10 0 1930 1940 1950 1960 1970 1980 1990 2000 Source: BP Statistics and Woodmac Discoveries (Mb/Year) Prod
Slide 6: Drilling activity is at a 20 year high
Drilling activity is at a 20 year high Rig count international Rig count North America Rigs Rigs 1,000 2,500 900 800 2,000 700 600 1,500 500 400 1,000 300 200 500 100 0 0 1999 2000 2001 2002 2003 2004 2005 2006 1999 2000 2001 2002 2003 2004 2005 2006 Oil Gas Misc Oil Gas Source: Baker Hughes Interna
Slide 7: Depletion leading to higher OCTG and line pipe consumption
Depletion leading to higher OCTG and line pipe consumption Depletion rates increase in mature fields in North America and elsewhere North America production – Oil & Gas China Production – Oil (Index 100=2002) (Index 100=2002) 250 250 200 200 150 150 100 100 50 50 0 0 2002 2003 2004 2005 2006 2002 20
Slide 8: Increasing well complexity requires specialized high-end products
Increasing well complexity requires specialized high-end products Expansion of horizontal and deviated Expansion of global offshore wells in USA drilling fleet 100% 1,200 90% 80% 1,000 +14% 70% 800 60% 50% 600 40% 30% 400 20% +55% 10% 200 220 0% 142 Jan-91 Jan-92 Jan-93 Jan-94 Jan-95 Jan-96 Jan-97 J
Slide 9: Increasing focus on high-end products
Increasing focus on high-end products Th metric tons 4,500 4,000 3,500 • In 2006 Q4 high-end exceeds 3,000 40% of seamless volume 2,500 • Investing to increase high-end 2,000 capacity 1,500 1,000 • With Hydril high-end will 32% increase further 500 32% 36% 0 2004 2005 4Q 2006 annualised High end sea
Slide 10: Participating in the world's complex projects
Participating in the world’s complex projects Snohvit Skarv Ormen Lange Gjoa Narianmar Novatek Long Lake Surmont Orenburg Primoria Astrakhan Karachaganak Tengiz Kashagan ACG In Salah Ourhoud In Amenas Puguang Thunder Horse Elephant Qatargas Atlantis Gassi Touil Pearl GTL Tahiti Mukhaizna Corocoro Yu
Slide 11: Building a leading position in the world's largest market
Building a leading position in the world’s largest market Worldwide OCTG consumption • Around 20% market share in North by region - 2006 America (USA and Canada) OCTG RoW Latin 10% • Products covering full range of drilling America1 applications from onshore shallow to 5% complex deepwater wells FSU
Slide 12: With Hydril, leader in premium connection technology
With Hydril, leader in premium connection technology Worldwide Premium Coupled joints Integral joints Connections Share Others 14% Tenaris 21% JFE 5% Grant 8% Hydril 16% VAM (Sumitomo) 14% VAM 22% TenarisBlue® Hydril 523™ 2007 Investor Day Tenaris 12
Slide 13: Human resources enable future growth
Human resources enable future growth Employees by country • 370 graduates entered Global Trainee 2006 program in 2006, including 250 engineers Japan Others 3% 4% Brazil • TenarisUniversity established to oversee Argentina 11% training and knowledge management 28% • Average 67 hours of training per w
Slide 14: Growth in operating results
Growth in operating results Millions of US$ 2004 2005 2006 Q4 2006 Net Sales 3,718 6,210 7,728 2,461 Tubes 3,273 5,124 6,824 2,132 Projects 280 790 454 172 Others 165 296 450 156 EBITDA 1 1,014 2,160 3,047 902 EBITDA margin 27% 35% 39% 37% Net income 3 785 2 1,278 1,945 5 575 5 Net income margin 21%
Slide 15: Summary
Summary • Strengthening position as leading supplier of tubular products and services to the global energy industry • Building a solid platform in North America • Well positioned to benefit from increased drilling activity and well complexity • Strong financial performance with solid growth prospect
Slide 16: 2007 Investor Day Tenaris
2007 Investor Day Tenaris Tubular Technologies. Innovative Services. Tenaris 16