Tenaris: Initiation of Coverage- $503 Million Free Cash Flow & Offshore Backlog As Pivotal Growth Levers!

Tenaris S.A. reported first quarter sales of $3.1 billion, representing a 6% increase year-on-year and a 4% sequential growth, despite disruptions caused by the Middle East conflict and the closure of the Strait of Hormuz. The sales growth reflected higher activity in Canada, a moderate recovery in Mexico, increased offshore sales in Brazil, stock building in North Africa, and advanced shipments in Saudi Arabia. Average selling prices in the Tubes segment rose by 5% year-on-year and 1% sequentially. Quarterly EBITDA increased 3% sequentially to $735 million with net income up 22% to $564 million, thanks in part to improved results below the operating line. The EBITDA margin remained stable at 24%, balancing higher maintenance shutdown costs with lower tariff expenses. Operating cash flow stood at $618 million, with capital expenditures of $114 million, producing free cash flow of $503 million. After $90 million in share buybacks, the company’s net cash position improved to $3.8 billion.