Italy's Tenaris sees lower sales in next two quarters on N. America slowdown, stoppages

Italian steel pipe maker Tenaris TEN sees sales and margins dropping in the second quarter due to sluggish drilling in North America and a decline in the third quarter due to stoppages at many of its mills.

The Luxembourg-based group on Thursday reported a better-than-expected 17% yearly fall in first-quarter sales to $3.44 billion, with core earnings (EBITDA) down 33% to $987 million.

The yearly drop was mainly due to lower prices of oil country tubular goods in the Americas, with sales and EBITDA marginally higher than in the fourth-quarter, Tenaris said in a statement.

"Although oil prices have risen, there has been no pick up in drilling activity in the USA so far this year and in North America it remains below last year's level," the statement said.

While lower than a year earlier, sales and EBITDA came ahead of analyst expectations.

Post results, Jefferies hailed "beats across all reporting lines", while J.P. Morgan mentioned the mitigating effect of international and offshore strength on the group's margins.

"Key for the shares is management commentary on the 2H24 outlook given the weaker than expected U.S. land rig demand", J.P. Morgan said.