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PJSC TMK ("TMK" or the "Group"), a leading supplier of steel pipes, pipe solutions and related services for various sectors of the economy, announces its audited consolidated results of operations for the year ended December 31, 2024, in accordance with International Financial Reporting Standards (IFRS).
Over the past year, the situation on the pipe products market remained difficult — according to our estimates, the volume of the Russian pipe market decreased by 6.6% compared to the record year of 2023 and amounted to 11.3 million tons. The high level of interest rates in the economy, restrictions on oil production within OPEC+ and the lack of major projects for laying main gas and oil pipelines have led to a decrease in demand and, as a result, the volume of sales of pipe products in the domestic market. Despite the deteriorating market conditions, the company managed to maintain its leading position in key segments, optimize its working capital and strengthen its liquid position.
During the year, TMK's key focus remained the sale of high-tech pipe products, debt relief, and the implementation of a digital business transformation program. According to the results of 2024, the total volume of sales of pipe products remained unchanged (+0.2% yoy) and amounted to 4,201 thousand tons, of which the volume of sales of seamless pipes was 3,068 thousand tons, and welded pipes - 1,132 thousand tons. tons. Due to the growth of welded pipes in the sales structure and an increase in business expenses, adjusted EBITDA (hereinafter referred to as EBITDA) decreased by 29.0% YoY and amounted to 92.4 billion rubles. Due to the release of working capital, free cash flow increased 2.5 times and amounted to 102.0 billion rubles. In the second half of the reporting period, TMK managed to reduce its net debt to EBITDA ratio to 2.8x as of December 31, 2024. High interest rates continued to put pressure on the Group's net result.
In 2024, the company completed a new phase of transition to digital production. As part of the comprehensive digitalization program, new automated systems responsible for production accounting, identification and tracking of the manufacturing process, as well as for equipment maintenance and repair were put into commercial operation at a number of plants belonging to the Group. In 2024, TMK continued its work.
