Steel pipe giant Tenaris TENR.MI expects a further increase in sales in the first half of the year after posting strong results in the latest three months of 2021, driving a 2.4% rise in its Milan-listed shares on Thursday.
The company, which makes seamless and welded steel pipes for oil and gas exploration activities, said in that sales in the first six months of the year should rise on higher prices in North America and shipments to an offshore pipeline in Europe.
"In the second quarter, we should see a significant recovery of sales in the Middle East and Africa," it added in a statement.
The company said that earnings before interest, taxes, depreciation and amortization (EBITDA) rose 151% to $483 million in the fourth quarter as a recovery in drilling activity and in oil country tubular goods (OCTG) prices in North America spurred a significant increase in sales.
Profit margins were up 23.5% compared with a 21.6% rise the previous quarter in spite of higher raw material and energy costs, beating the company's own expectations of a steady EBITDA margin in the last three months of the year.
The company added profit margins should also continue to increase in the first half of 2022.
Analysts at JP Morgan said in a note that such EBITDA margin guidance is particularly relevant, while Credit Suisse noted that the market should "take the results slightly positively."
Tenaris added it would pay out a dividend of $0.28 per share.
(Reporting by Federico Maccioni, editing by Maria Pia Quaglia and Keith Weir)