Tubos Reunidos 2023 performance improves, outlook positive

Spanish seamless tube supplier Tubos Reunidos (TR) saw most of its main indicators grow in 2023 compared to the previous year, Kallanish notes.

“The year was characterised by an outstanding performance in the first half, based on the high prices seen in the seamless pipe market, and by weaker demand in H2 due to the high level of stocks held by distributors and end customers, which resulted in a slowdown in incoming orders,” TR comments.

The positive sales performance was supported by a reduction in costs and efficiency measures as part of its Strategic Plan, the company notes.

TR anticipates a normalisation of sales volumes and prices in 2024, with lower activity in H1 and a gradual recovery in demand throughout the year. The company however says it will be difficult for values to recover to levels seen in 2023.

“The year [2024] started with a high degree of uncertainty, a macroeconomic environment with relatively high inflation and interest rates that remain high for longer than expected. Moreover, the significant inflow of pipes imported at low prices is a factor that must be taken into account, insofar as it adds additional pressure to a sluggish market situation in Europe,” TR observes.

In the US, the company sees as positive the extension until December 2025 of quota allowances for EU steel and aluminium. “Demand for pipes is expected to recover as current stock surpluses held by distributors and end customers are reduced,” TR adds.

The tube supplier confirms a significant part of its activity in 2024 will focus on low-emission production. This will strengthen a segment that will be one of the key areas of its growth and value generation.

The group’s revenue in 2023 grew 3.7% versus 2022 to €532.9 million ($577.7m). The North American market represented 46% or €245m of revenue compared to 54% in 2022. The remaining markets where TR operates also performed positively, especially in Europe due to high price levels.

The company posted an Ebitda of €106.8m last year, an improvement by €42.3m compared to 2022.

Todor Kirkov Bulgaria