Vallourec Reports 2020 Results

World leader in premium tubular solutions Vallourec announced its results for the fourth quarter and full year of 2020. Vallourec Chairman Mr Edouard
Vallourec Reports 2020 Results
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World leader in premium tubular solutions Vallourec announced its results for the fourth quarter and full year of 2020. Vallourec Chairman Mr Edouard Guinotte said “Although Vallourec's revenue in 2020 was strongly impacted by the considerable drop of its activity due to Covid pandemic impact on oil demand and E&P activity worldwide, the Group has demonstrated its capacity to adapt, achieving an almost stable EBITDA margin year-on-year.In addition, two weeks ago, we achieved a key milestone in the Group's financial restructuring, by reaching an agreement in principle with our main creditors. The implementation of this agreement, which is still subject to customary conditions precedent, will enable Vallourec to rebalance its capital structure by reducing its debt and securing the necessary liquidity to roll out its strategic plan. It will open a new chapter in Vallourec's history with our future shareholders, Apollo and SVPGIobal, whose in-depth knowledge of our markets will support the Group's value creation ambition.”

Highlights

EUR 3.242 billion revenue down 22% YoY

EUR 258 million EBITDA versus EUR347 million in 2019

EBITDA margin maintained almost stable, at 8.0% of revenue vs 8.3% in 2019

Volume impact of minus30% mainly driven by Oil & Gas in North America and in EA-MEA

Positive price/mix effect of +16% including a better price/mix in Oil & Gas in EA-MEA and South America and lower prices in North America

Currency conversion effect of -8% mainly related to EUR/BRL

2021 Outlook - Mr Guinotte said “Looking ahead, we expect Oil and Gas activity to globally remain subdued in 2021. While dhlling should gradually restart in North America, and continue growing off-shore Brazil, EA-MEA should face difficult market conditions with no recovery visible before 2022. Our Industry markets are expected to slowly restart in 2021, and Vallourec's iron ore mine activity should bring an increased contribution. In this context, we will continue deploying our cost savings and cash management initiatives along the year.”

Oil and Gas activity expected to remain subdued in 2021

Iron ore mine expected to bring an increased contribution

Continuous cost savings and cash management initiatives along the year

EBITDA targeted between EUR 250 and EUR 300 million

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