Tenaris S.a. · MIL:TEN
Tenaris — Investor Presentation (March 2004)
23 slides from Tenaris's investor presentation, March 2004
Slide 1: Investor Presentation
Investor Presentation March 2004
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
Slide 3: Tenaris: 50 years of industrial enterprise
Tenaris: 50 years of industrial enterprise ¾ 1950’s Founding of Tamsa and Siderca ¾ 1967 Listing of Tamsa (first Mexican ADR) in AMEX ¾ 1980’s Capacity expansion for exports ¾ 1993 Start of acquisitions ¾ 2001 Listing of Siderca on the NYSE ¾ 2001 Launch of “Tenaris” brand ¾ 2002 Exchange offer 3
Slide 4: Expansion over the last 15 years
Expansion over the last 15 years Annual production capacity (thousand tons) Seamless operations Welded operations 3,125 Siderca - Argentina Siat - Argentina 250 Confab - Brazil Tamsa - Mexico Dalmine - Italy 2,615 260 Tavsa - Venezuela 2,500 65 65 850 NKKTubes - Japan AlgomaTubes- Canada 350 500 950
Slide 5: Today: a leading global player in steel pipes and services
Today: a leading global player in steel pipes and services Eight steel pipe mills strategically located around the world with a combined production capacity of 3.125 million tons of seamless and 850,000 tons of welded steel tubes Oilfield Pipeline Supported by a global distribution and Services
Slide 6: Global reach with local presence
Global reach with local presence Stavanger z Aberdeen z z Moscow z Calgary AlgomaTubes Rugby zz London z Mannheim Parisz Dalmine z Atyrau z Baku Beijing z NKKTubes z z Houston z Seoul Cairo Tamsa z Dubai Caracas z Tavsa z Kuala Lumpur z Port Harcourt Singapore z Bogota z Quito z Santa Cruz z Confab
Slide 7: Leading market share
Leading market share OCTG seamless world trade Other statistics market Other ¾ 12% of world production West capacity of seamless products Europe USA 9% 4% Tenaris ¾ 19% of world production of 30% seamless OCTGs East Europe & ¾ 19% of world trade of seamless CIS 18% products ¾ 30% of world trade of s
Slide 8: Solid relationships with premier names in Oil & Gas sector
Solid relationships with premier names in Oil & Gas sector 8
Slide 9: With a global manufacturing profile
With a global manufacturing profile Seamless operations Tenaris’s total capacity breakdown 2 Capacity Seamless + Welded Acquisition date 1 Company Country (000 tons) Siderca Argentina 820 Argentina 29% Jun-93 Tamsa Mexico 780 Feb-96 Dalmine Italy 950 Venezuela 2% Oct-98 Tavsa Venezuela 65 Aug-00 NKK
Slide 10: ...a well-balanced portfolio
...a well-balanced portfolio Tenaris volume breakdown Tenaris net sales breakdown Far East 2003 In thousand of tons 2002 2003 & South Oceania America 10% 24% Middle Seamless Pipes Sales Volume 2,283 2,278 East and Africa South America 324 322 12% North America 401 608 Europe 637 617 Europe North Ame
Slide 11: ...solid financial results
. . . solid financial results 2001 2002 2003 (*) US$ millions % Net sales 3,174 100% 3,219 100% 3,180 100% Operating income 442 14% 472 15% 288 9% EBITDA (1) 603 19% 648 20% 488 15% Net income(2) 136 4% 194 6% 210 7% (*) Excluding the loss recorded in respect of the BHP lawsuit, operating income wou
Slide 12: ...a strong balance sheet
…a strong balance sheet Current debt situation (US$ million) Capitalization (assets of US$ 4.3 bn under IAS 1) As of December 31, 2003 4,664 Cash & equivalents 248 Net debt 586 Financial debt 834 Net debt 586 Net debt/equity 29.9% 4,078 Market cap 2 1) Assets as of December 31, 2004 2) Market cap as
Slide 13: ...and competitive strengths
...and competitive strengths ¾ Global production, commercial and distribution capabilities ¾ Ability to provide value-added services worldwide ¾ Ability to design and manufacture technogically advanced products ¾ Solid and diversified customer base ¾ Low-cost operations, primarily at state-of-the-ar
Slide 14: Transforming into a service and technology company
Transforming into a service and technology company Tubular technologies, Innovative services ¾ Supply chain services: ¾ Extensive use of IT: ¾ Just-in-time installed column (JIC) ¾ TenarisTracking ¾ Advanced product development: ¾ New premium joint technology ¾ Deep water applications 14
Slide 15: First year after listing
First year after listing tl 15
Slide 16: Share price performance on the NYSE
Share price performance on the NYSE Price (US$/ADR) 40.00 38.00 36.00 34.00 US$34.55 32.00 30.00 28.00 26.00 24.00 22.00 20.00 18.00 US$16.40 16.00 16-12-02 16-10-03 16-11-03 16-12-03 16-1-03 16-2-03 16-3-03 16-4-03 16-5-03 16-6-03 16-7-03 16-8-03 16-9-03 16-1-04 16-2-04 16
Slide 17: Trading volumes in the four markets
Trading volumes in the four markets Millions of dollars traded per month Volumes traded in the four markets (% of total) 1 135 125 115 Italy 105 8% 95 NYSE 73% 85 75 Argentina 65 14% 55 45 Mexico Dec 02 Jan 03 Feb-03 Mar-03 Apr 03 May-03 Jun-03 Jul-03 Aug 03 Sep-03 Oct-03 Nov-03 Dec 03 Jan-04 Feb-04
Slide 18: Shareholding structure after delistings
Shareholding structure after delistings Tenaris 55.7% 100.0% 51.6% 100.0% 44.3% 47.0% Tenaris Global Tamsa Siderca Dalmine (Mexico) (Argentina) (Italy) Services 70.0% 1 20.0% 80.0% 51.0% 2 39.0% 3 70.0% 30.0% Tavsa AlgomaTubes NKKTubes Confab Siat (Venezuela) (Canada) (Japan) (Brazil) (Argentina) Se
Slide 19: Sidor and BHP
Sidor and BHP ¾ Sidor debt Sidor’s and Amazonia’s aggregate debt reduced from restructuring US$1.9 to US$0.8 billion Tenaris invests additional US$32.9 millions Guarantees released Amazonia’s stake reduced to 60% Tenaris receives US$10.5 million excess cash during October ¾ BHP lawsuit F
Slide 20: Strategic alliances
Strategic alliances ¾ Sandvik Tenaris becomes exclusive distributor for Sandvik’s stainless and specialty steel OCTG thus completing product range ¾ Socotherm Joint marketing of pipe coating services Joint ownership of assets adjacent to Tenaris plants Joint development of new products and s
Slide 21: Strengthening of operations
Strengthening of operations ¾ Purchase of Argentine Argentine operations self-sufficient in power power plant Purchase price of US$23 million 160 MW ¾ Advance purchase of 760 million cubic meters over five years natural gas US$15.3 million advance payment Limiting impact of future gas pr
Slide 22: Some conclusions
Some conclusions ¾ A global company (assets, revenues, customers & operations) ¾ Serving the global energy industry ¾ Leader in its industry sub-sector (seamless OCTG) ¾ Management focused on long-term sustainable growth ¾ Consolidating and extending competitive advantages ¾ Cash flow and financial
Slide 23: Tenaris
Tenaris