the Information contained in this press release includes statements concerning future events. These statements are based on current views and assumptions of management of the Company subject to known and unknown risks and uncertainties.
pipe Metallurgical Company (TMK), one of the world's largest producers of pipes for the oil and gas industry, announces its operational results for the second quarter and first half of 2020.
the Group's Results include the operating results of the Russian and European divisions, the company's production assets are located in Russia, Romania and Kazakhstan.
For comparative purposes, operating results of the Group presented the results of the Us division (2 January 2020 TMK has completed the sale of 100% of shares of IPSCO Tubulars Inc.).
Final results for the 2nd quarter and first half of 2020
1 floor. 2020
1 floor. 2019
2nd quarter 2020 compared to 1st quarter 2020
- Total pipe shipments decreased by 8% compared to the first quarter of 2020, mainly as a result of lower shipments of welded pipes in the Russian division.
- shipments of seamless pipe increased by 6% compared to the previous quarter due to increased shipments of seamless OCTG in the Russian division (8% compared with the first quarter of 2020) and the growing shipments of seamless industrial pipe in the Russian and European divisions.
- shipments of welded pipes decreased by 40% compared to the first quarter of 2020 due to the lower shipments in all segments of welded pipe in the Russian division, in particular, reduction of deliveries of pipes of large diameter by 42% compared to the previous quarter. The challenging macroeconomic situation has put pressure on consumption of pipe products, which negatively affected the dynamics of shipments of welded pipes.
the First half of 2020 in comparison with the first half of 2019.
-Total pipe shipments decreased by 13% compared to the first half of 2019 because of lower shipments of seamless pipes in the Russian and European divisions and a reduction in shipments of welded pipes in the Russian division. This was due to the unfavorable economic situation in the world resulting from a pandemic COVID-19 and the volatility of oil prices.
- shipment volumes of seamless pipes decreased by 8% compared to the same period last year because of lower shipments of seamless OCTG in the Russian division is 8% and weaker demand for seamless industrial pipe in the European division.
- shipments of welded pipes have decreased by 26% compared to the same period last year as a result of lower shipments in all segments of welded pipe in the Russian division.
Comment of the General Director of TMK Igor Korytko:
"In the second quarter of 2020, the macroeconomic situation in the world remained challenging and continued to exert pressure on the level of demand for our tubular products. This was the reason for the decline in the total volume of our shipments compared with the first quarter. We have noted some recovery in shipments of seamless OCTG in the Russian division, accompanied by a stable demand for pipes with premium connections, as well as increased consumption of seamless pipes for industrial use in Europe compared to the previous quarter of this year. However, we do not expect the overall level of demand for tubular products will seriously improve in the short term."
Forecast for the third quarter of 2020
We expect in the third quarter of 2020 the volume of shipments in the Russian division will continue to be under pressure due to the continuing difficult market situation and carry out planned works on modernization and technical maintenance of the main enterprises of the Russian division.
We expect that the consumption of industrial pipe in the European market will continue to recover gradually.
TMC announces operating results for the second quarter of 2020.