It is its best result since 2008 and the firm has an order book of 303 million euros, 71% more than at the beginning of 2022

Tubos Reunidos has closed the 2022 financial year with consolidated income of 524 million euros and a turnover of 514 million, doubling the amount of 2021 and obtaining 43.5 million euros of net profit, compared to losses of 64.7 million by 2021.

In a statement, the company has highlighted that it is the best result since 2008, which confirms its recovery and compliance with the Strategic Plan.

The company has obtained a turnover of 514 million, doubling the amount of 2021. The EBITDA of the Group has amounted to 64 million euros, increasing the amount obtained in 2021 by 115 million. The Group has generated a net cash flow of 18 million euros, closing the year with 95 million euros in cash and reducing its net debt.

Growth has been notable in volume, but especially in sales prices, which have shown a growing trend as Tubos Reunidos has been able to progressively pass on to the market the strong increases in energy and raw material costs, as well as maintain them. subsequently despite high volatility.

With the data for 2022, Tubos Reunidos currently has an order book worth 303 million euros, 71% higher than at the beginning of last year, which marks a "record" level, especially with a mix of algae steels carbon or low alloys highly concentrated in the OCTG and mechanical segments", the company pointed out.

With regard to investments in 2022, the execution of the unification of the cold drawing units of the Pamplona and Amurrio plants has been undertaken, already completed in the latter, and, on the other, the concentration of the casting processes of the steelworks of Trapaga and Amurrio, thanks to an investment of more than 11 million euros that will make it possible to produce both billets and ingots at the same facility, the starting raw material for the manufacture of tubes of different diameters and compositions.

The unification of both steel mills, which is expected to be completed by the end of the first half of 2023, will allow, in addition to substantially increasing the capacity used and generating significant energy improvements, to obtain a more efficient steel casting process thanks to the optimization of the bottleneck.

This action includes, in a second phase that will be carried out in 2024, the start-up of an AOD process (oxygen and argon decarburization) that will allow the use of lower-cost ferroalloys without compromising quality.

The evolution of 2022 allows "to face 2023 with confidence due to its order book and the favorable signs of the market from the point of view of demand, with the challenge of managing uncertainty and possible volatility in costs", they have assured. from Tubes Reunited.

For the president of the company, Francisco Irazusta, the positive net result of 43.5 million euros is "a very important milestone that allows us to face the investments foreseen in the strategic plan, as well as all the commitments with creditors".

MARKETS

Regarding the past financial year 2022, Irazusta explained that it has been characterized by "the volatility and variability of demands and costs, and I believe that 2023 will follow the same line, with a differential data: this year we started it with an order book of 303 million euros, 71% higher than at the beginning of last year, which allows us to be moderately optimistic".

The activity has been very focused on carbon steel pipes, for three main reasons: an initial portfolio in January 2022 with a significant weight of the commodity product due to the replenishment of inventories by customers and the distribution chain throughout of the previous exercise; strong oil order intake

The main European markets, fully affected by the reduction in gas supply from Russia and focused on the need to promote investments that reduce their dependence on that country, have also performed very well, with strong demand and a favorable evolution of prices.

By geographical areas, the specific increase in sales to North America stands out with 252 million euros, which represents 53% of the Group's total turnover, compared to 25% in 2021. The high volume of exports outside the Union The European Union has also benefited from the appreciation of the dollar against the euro.

The main European markets, fully affected by the reduction in gas supply from Russia and focused on the need to promote investments that reduce their dependence on that country, have also performed very well, with strong demand and a favorable evolution of prices.

On the contrary, it has continued without seeing a reactivation in other areas. The demand for orders from China, still affected by the restrictive policies to face the successive outbreaks of Covid-19, has evolved weaker than expected, while the projects that have been launched in the Middle East have done so at unattractive prices for foreign manufacturers, who are unable to benefit from the region's low energy costs.

Sales growth has occurred in all sectors of activity: upstream (OCTG) represents 33% of total billing volume, with a 439% increase over the year 2021, based on the reactivation of the North American market at pre-levels. -pandemic, but with much higher prices. In second place, pipes for mechanical-industrial application stand out, with an increase of 68 million euros in turnover, 112% compared to 2021. Likewise, there are also increases in downstream sales, 8% over 2021, and midstream 110% compared to 2021 with very little activity.

In relation to projects related to electricity generation, refining and petrochemicals (downstream) that provide a mix of more alloyed and stainless steels, although there has been some reactivation of projects paralyzed due to the pandemic, the pulse we expected in the main markets of Asia and the Middle East.

On the other hand, the variation in personnel expenses is affected by the inclusion, in the 2021 financial year, of expenses associated with the strategic initiatives launched within the Strategic Plan and by the lower expenses derived from the Temporary Employment Regulation Files that affected part of the squad last year. Without this effect, there is an increase in the cost of personnel as a result of the higher level of productive activity, the reactivation of the factory in the United States and the update of salaries due to the impact of the CPI.

Finally, the need to promote the ecological transition for the sake of a sustainable economy is presented as an opportunity for the Tubos Reunidos Group. In addition to being a key industry in conducting energy, the Group is opening new lines of development both for process improvement and for new applications related to clean energy, and in particular with the hydrogen value chain, areas where the sales portfolio is expected to increase in the future.