Tenaris S.a. · MIL:TEN
Tenaris — Investor Presentation (November 2007)
22 slides from Tenaris's investor presentation, November 2007
Slide 1: Investor Presentation November 2007
Investor Presentation November 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: Global industrial system serving the energy industry
Global industrial system serving the energy industry • Annual manufacturing capacity of Net Sales 9M07 six million tons of steel pipes Far East & - 3.4 million tons of seamless pipes Oceania 8% South America - 1.9 million tons of welded pipes 22% - 850 K tons of welded pipes for Middle East & pipeli
Slide 4: With unmatched global footprint
With unmatched global footprint Investor presentation Tenaris November 2007 4
Slide 5: Positioned for growth
Positioned for growth • Building a leading market position Worldwide OCTG consumption in USA and Canada by region - 2006 RoW • Leading market position with full 10% range of products in Latin America Latin America 5% (ex-Brazil) FSU USA and 10% • Leading market position in high- Canada 44% end produ
Slide 6: Integrating a solid platform in USA and Canada
Integrating a solid platform in USA and Canada • Full range of products (seamless, welded, premium connections, coiled tubing) with related services • Approx. 20% OCTG market share in USA and Canada combined • Industrial focus on quality, processes and safety • Working with distributors to add value
Slide 7: Changing the OCTG premium connection landscape
Changing the OCTG premium connection landscape TenarisHydril: a unique combination to meet the needs of ever more demanding drilling environments Worldwide Premium Connections Share Coupled joints Integral joints Others 14% Tenaris 21% JFE 5% Grant 8% Hydril VAM 16% (Sumitomo) 14% VAM (Vallourec) 22
Slide 8: Developing advanced deepwater line pipe technologies
Developing advanced deepwater line pipe technologies Steel Catenary Riser Top Tension Riser Bends Upset SCR TDZ Flowlines Investor presentation Tenaris November 2007 8
Slide 9: Managing the supply chain from the mill to the well
Managing the supply chain from the mill to the well • String design • Inventory and pipe management • Just-in-time delivery to the rig • Accessories procurement • Tubular running assistance Investor presentation Tenaris November 2007 9
Slide 10: Participating in the world's most demanding projects
Participating in the world’s most demanding 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 Coro
Slide 11: Investing in human resources to enable future growth
Investing in human resources to enable future growth • 370 graduates entered Global Employees by country Trainee program in 2006, including 2006 250 engineers Others Japan 6% USA 3% 16% Canada • TenarisUniversity established to 5% oversee training and knowledge Romania 6% management Brazil 8% • Aver
Slide 12: 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 Discoveries (Mb/Year) Production (Mb/Year) Source: BP Statistics
Slide 13: 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 China Production Oil & Gas 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 2003 2
Slide 14: Drilling activity in long-term uptrend …
Drilling activity in long-term uptrend … Rig Count International Rig Count North America 1,100 2,200 1,000 2,000 900 1,800 800 1,600 700 1,400 600 1,200 500 1,000 400 800 300 600 200 400 100 200 0 0 1999 2000 2001 2002 2003 2004 2005 2006 9M07 1999 2000 2001 2002 2003 2004 2005 2006 9M07 Oil Gas Mis
Slide 15: … and drilling complexity is increasing
… and drilling complexity is increasing US wells drilled over 15000’ • Deepwater 1700 1500 • Deep directional 1300 1100 • Sour gas 900 700 • Thermal 500 2000 2001 2002 2003 2004 2005 2006 2007E Expansion of horizontal and deviated wells in USA • Arctic 100% 80% • Horizontal and extended reach 60% 40
Slide 16: Expansion of offshore drilling fleet
Expansion of offshore drilling fleet Rigs by region 129 new rigs are scheduled to be (June 2007) delivered between 2007 and 2010 RoW 17% new-build scheduled delivery USA 60 28% 50 4 Brazil 4% 12 40 6 Mexico 30 6% 20 20 36 5 1 West Africa 2 10 7 7% 17 12 North Sea 7 0 15% Far East 2007 2008 2009 2010
Slide 17: Growth in operating results
Growth in operating results Millions of US$ 2004 2005 2006 9M 2007 Net sales 3,718 6,210 7,728 7,553 Tubes 3,273 5,124 6,824 6,400 Projects 280 790 454 561 Pressure control – – – 139 Others 165 296 450 454 Operating profit 806 1,946 2,792 2,225 EBITDA 1 891 2,160 3,047 2,597 EBITDA margin 24% 35% 39
Slide 18: Technical data
Technical data Fixed assets – Dec. 2006 Average daily trading – 9M2007 Far East & Buenos Aires Oceania 1% 3% New York 36% Europe 27% Milan North 63% America 41% South America 29% Investor presentation Tenaris November 2007 18
Slide 19: 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 20: Investor presentation Tenaris November 2007
Investor presentation Tenaris November 2007 20
Slide 21: Complex drilling requires high-end products
Complex drilling requires high-end products Land Land Offsh. Shallow Water Offshore Deep Water Shallow Well Directional Deep Well Directional Deep Well Deep Well 30” 50 m 9 5/8” 300 m 20” 800 m 18 5/8” 850 m 13 5/8” 1800 m 13 5/8” 1550 m 5 1/2” 1800 m 13 3/8” 3500 m 3200 m 9 5/8” 9 5/8” 3200 m 11 ¾”
Slide 22: Share liquidity and distribution
Share liquidity and distribution Average daily trading Free float shares by market Millions of US$ September 2007 280 Buenos Aires, 15% 240 New York, 61% 200 160 Milan, 22% 120 80 40 Mexico, 2% 0 2004 2005 2006 9M2007 New York Milan Buenos Aires Mexico Investor presentation Tenaris November 2007 22