Tenaris S.A. Q4 2025 Earnings Call - Tariff headwind offset by operational muscle and a growing offshore backlog

Conference Operator: Good day, and thank you for standing by. Welcome to the fourth quarter at the Tenaris S.A. Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker’s presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today’s conference is being recorded. I would now like to hand the conference over to your speaker today, Giovanni Sardagna, Investor Relations Officer. Please go ahead.

Giovanni Sardagna, Investor Relations Officer, Tenaris S.A.: Thank you, Gigi, and welcome to Tenaris 2025 fourth quarter and annual results conference call. Before we start, I would like to remind you that we will be discussing forward-looking information during the call and that our actual results may vary from those expressed or implied during the call. With me on the call today are Paolo Rocca, our Chairman and CEO, Carlos Gómez Álzaga, our Chief Financial Officer, Gabriel Podskubka, our Chief Operating Officer, and Guillermo Moreno, President of our U.S. Operations. Before passing over the call to Paolo for his opening remarks, I would like to briefly comment our quarterly results.

During the fourth quarter of 2025, sales reached $3 billion, up 5% compared with those of the corresponding quarter of the previous year, and 1% sequentially, as our sales to rig direct customers in the United States and Canada continued to show resilience, and in Argentina, we resumed our fracking and coil tubing services. Our EBITDA for the quarter was down 5% sequentially to $717 million, or 24% of sales. These results include the full impact of the 50% Section 232 tariffs in the U.S. Average selling prices in our tube operating segment decreased by 1% compared to the corresponding quarter of last year and were flat sequentially. During the quarter, cash flow from operation was $787 million.

Our net cash position at the end of the quarter decreased to $3.3 billion, following the payment of an interim dividend of $300 million in November last year, $537 million spent on share buybacks, and capital expenditure of $123 million during the quarter. The board of directors have decided to propose for the approval of the annual general shareholders meeting, to be held at the beginning of May, the payment of an annual dividend of $0.89 per share or $1.78 per ADR, which includes the interim dividend of $0.29 per share or $0.58 per ADR that we paid at the end of November of last year.

If approved, a dividend of $0.60 per share or $1.20 per ADR will be paid on May 20, up 7% compared to the dividend per share of the corresponding period of the previous year, thanks to the benefit of our buyback program. Now, I will ask Paolo to say a few words before we open the call to questions.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Thank you, Giovanni, and good morning to all of you. 2025 was a year in which Tenaris demonstrated the resilience of its operation in the face of a disruptive geopolitical environment and lower activity in key markets. Thanks to our extensive geographical presence, the depth of the service we offer to our customer, and the commitment of our employees, we were able to respond rapidly to the various situation we faced. Our results remained remarkably stable through the year, which we completed with an EBITDA of $2.9 billion and a net income of $2 billion on net sales of $12 billion. Free cash flow amounted to $2 billion, all of which were distributed to shareholders through dividend and share buybacks.

We are proposing a further increase of the annual dividend per share of 7% over that for the previous year. At the same time, we maintain a net cash position of $3.3 billion. In the U.S. and Canada, the years was marked by further oil and gas industry consolidation and productivity improvement, a lower rig count, and the extension of Section 232 tariff to the import of all steel products, including the steel bars we require for our seamless pipe operation at Bay City, and their subsequent increase to 50%.

In this environment, Tenaris raised the performance of its U.S. production and supply chain system, with its coupled steel shop, main pipe production plants at Bay City, at Hickman and Enbridge, and various pipe processing facilities acting in concert to achieve a record level of production and supply, 90% of our U.S. sales. In both the U.S. and Canada, we strengthened our market position and extended the differentiation we offer under our Rig Direct service model. As customers targeted operational efficiency, we continue to develop and roll out our Run Ready and Well Integrity services that support them by increasing safety and reliability at the well site. Major oil and gas companies are seeking new production reserves to meet a more resilient long-term demand outlook, and are looking beyond the shales with their faster decline curves to deepwater development and exploration in frontier region....

Tenaris, with its capacity to develop product for complex operation and to support fast-track development with service and the supply of advanced coated line pipe solution at scale, is working with most of these companies as they develop such project. As new offshore project are sanctioned around the world, we see many opportunities to renew our order backlog, while we execute on existing commitment. Currently, we are delivering casing for Shell Sparta 20K project in the U.S. deepwater, extending our services for ExxonMobil’s operation in Guyana, and preparing a service base for TotalEnergies’ Grand Morné development in Suriname, while planning the production of seamless and welded line pipe and coating for the third phase of TPAO Sakarya gas development in the Black Sea.

In Latin America, the Mexican government is taking steps to address the financial difficulties of Pemex, which took a toll on oil and gas drilling activity in the country last year. While in Argentina, domestic companies have been able to raise more than $4 billion in financing to develop infrastructure and expand production operation in the Vaca Muerta fields. We supplied the Vaca Muerta South pipeline and are currently supplying the Duplica Norte pipeline. We are also investing to expand our new fracking and coil tubing service business and expect to put a third set of equipment to work before the end of the year. In Venezuela, following the intervention of the U.S. government, we are resuming our service to Chevron operation and building up our service capability in the country to support any increase in drilling activity.

In the Middle East, we continue to consolidate our presence with the award of a long-term agreement for the supply of OCTG to the Northwest Field development in Qatar, while in the Emirates, we enhance our Rig Direct service to ADNOC, delivering a record amount of OCTG. In Saudi Arabia, also, conventional drilling activity was reduced during the year. We completed an expansion at our local large diameter facility, from which we are supplying line pipe for the development of gas infrastructure, in addition to the OCTG we supply for Aramco drilling operation. Our global integrated industrial and supply chain operation have been key to our ability to respond effectively to the different events we faced during the year. We continue to invest in enhancing the efficiency and digital integration of these operations, as well as reducing their environmental impact.

We made further progress toward our midterm target of reducing the carbon emission intensity of our operations, as we brought our second wind farm in Argentina into operation. The two wind farms now supply essentially all of the energy requirement for our electric steel shop and operation in Canada. As an industrial company, our commitment to the safety of our employees and to the environmental sustainability in our communities is absolute. Also, our indicators have improved this year. We continue to reinforce our preventive action and monitor our performance in this aspect. Tenaris, with its presence across the world, competitive differentiation in product service, the quality and compliance of its operation, and the financial strength to support the strategy, remains well placed to confront an unpredictable and volatile future.

I would like to thank all our employees and the communities who sustain our operation for their constant commitment and engagement that have made possible our results and achievement this year. I would also like to thank our customer and our supplier for their ongoing trust and support. Thank you very much, and we are open to any question you may have.

Conference Operator: As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Mark Bianchi from TD Cowen.

Mark Bianchi, Analyst, TD Cowen: Hi, thank you. I wanted to start by asking about the outlook here in first quarter, and maybe you could talk about, to the extent you’re comfortable, how things progress beyond first quarter. When you talked about being close to current levels in fourth quarter, is that? Should we interpret that as meaning flat? And are there any nuances with volume and price that we should be thinking about as we build that out, and then any comments sort of beyond first quarter would be great.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Well, thank you, Mark. Well, within our visibility today and considering many parts moving in the energy market, and also in general, geopolitical environment, I think is not easy to have a medium-term forecast. Now, what we see is a relative stability of our performance and our position in the market during the first quarter, and it’s not so easy. We do not see today point that should disrupt our operation even in the second quarter. But for the time being, as we say, we feel comfortable in forecasting a first quarter in which the level of margin and, in general, the results we can get are more or less in line with the fourth Q.

It’s difficult to have a more long-term forecast, considering the volatility of the environment in which we are moving.

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: Yep. Makes sense. Thank you for that. And then the other one, maybe somewhat related, the margin resilience in the fourth quarter was quite good. And I’m curious how much of that benefited from some of the actions that you’re taking, I think you mentioned couple in the press release, to try to offset some of the tariff headwind that you’ve experienced. I think previously we talked about that being something like $140 million a quarter of tariff costs that you’re having to deal with. So I’m curious, how much progress did you make on that in 4Q, and what is the opportunity going forward?

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Well, in we are, let’s say, continuously operating, in the efficiency of our operation, including our capacity to produce more steel in, in the U.S. So we expect for the first quarter of next year, that, a lower level of tariff will get into our, EFRs. Because in the end, we are operating on this, even in the past few months, and we think that what is getting into our results in the first Q, will be, relatively slightly lower of what we have in, in the, in the fourth Q.

But on the other side, the indicator of prices in North America, I mean, are not—in spite of the impact on the hot rolled coils and other products of the steel industry, are moving relatively slow in the pipe business, and especially in a welded pipe. So considering the impact of slightly lower tariff and where we are in term of Pipe Logix, and so, I think in what is moving around in the world, I think this is the component that justify our vision of a relatively stable top line and margin data for the first quarter.

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: Great. Thank you very much. I’ll turn it back.

Conference Operator: Thank you. One moment for our next question. Our next question comes from the line of Matt Smith from Bank of America.

Matt Smith, Analyst, Bank of America: Hi there. Good morning, good afternoon. My first question was around the international business and on pricing. Just whether you have seen any signs at all of pricing pressure, given how some of the international benchmarks have traded down, I guess, since summer 2025? Any color you could give on different regions could be useful. Thank you.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Thank you, Matt. I would say that, as you know, our business globally is composed of many different niche, high-demanding product, different region, different level of service. So, I would say, to some extent, that the price impact is more easy to understand and project in North America than internationally. But by the way, I will ask Gabriel to give you a vision of what we see in front of us on the ground.

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: Yeah. Thank you, Paolo. Good morning, Matt. On the pricing on the international markets, we see in general some stability, a balanced demand and supply, especially on the premium products, where we are mainly focused. So, premium, sour service, high technical, qualified pipelines. This demand is quite strong, driven by offshore, by Middle East, in sour gas and sour service development. So we see the demand on these, on these segments, quite stable. We have, in many cases, long-term agreements that have some formulas related to raw materials. So I would say that the majority of our backlog and our business in international market are driven by stability in the pricing.

It is true that there are some spot tendering, where we’re seeing a slight deterioration in environment, especially when we are talking about of lower end applications, but this is not the most important part of our business, and this is something that we monitor. So I would say, given all the moving pieces and the increasing component of our offshore within 2026, in our international mix, I would say that pricing in the international market are quite stable for Tenaris.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Thank you, Gabriel. Let me just add one point on which maybe that is the European. In Europe, maybe it’s early to perceive the impact, but the CBAM and the safeguard that is supposed to raise the quota- to raise the tariff to 50% and reduce the quota by almost 50%, may have a favorable impact on a relatively important segment of our international business that is all supported by the industrial power gen activity into into Europe. To some extent, I think in the view of the overall say future of our operation, maybe not immediately, but we should be able to really improve our situation and pricing in Europe.

Also this reflect with the present exchange rate, getting to our top line relatively well.

Matt Smith, Analyst, Bank of America: Perfect. Well, thank you for all that color. I wanted to ask a second question around the buyback, if I could. So I appreciate the current tranche, $600 million, is still ongoing. We’ll have to sort of await the next announcement later in the year. So just wanted to ask, you know, check whether your philosophy around the buyback has changed at all since last year, or should we very much expect this to continue to be a material component of shareholder returns in the near future? Thank you.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Yes, thank you, Matt. As you were saying, you know, with the general assembly and the board decided for a program of share buyback of $1.2 billion from May 2025 until May in 2026, divided in two tranche, the second tranche has been approved again in October. Now, the decision, obviously, is to the assembly and the board for the decision on this ground. But the, let’s say, the factor that were relevant for the decision on the shareholder didn’t change so much.

We will see if in the assembly in May and the board after this should decide on this, when the second tranche of $600 will be should be closed. They will consider the different factor, the level of cash availability in the company, the perspective of this, and on this basis, they will consider a possibility to continue the program of share buyback.

Matt Smith, Analyst, Bank of America: Perfect. Well, thank you very much for all that color. Happy to pass it on.

Conference Operator: Thank you. One moment for our next question. Our next question comes from the line of Arun Jayaram from JP Morgan.

Arun Jayaram, Analyst, JP Morgan: Good morning, Paolo and team. I was wondering if we could talk about your expectations around potentially getting to an inflection point in the Pipe Logix pricing indices, just given your thoughts on, you know, import trends and where, when and where could, do you expect us to see that pricing inflection point? Because it continues to trend down, call it, in low, you know, percentage points at this point, looking at the most recent pricing data.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Yes, thank you, Arun. Well, you know, the factors that are, let’s say, having an impact on the Pipe Logix, are different. But you should also consider that there is a Pipe Logix for seamless and a Pipe Logix for welded. What we see is that, to some extent, the Pipe Logix for welded is having a drag down on the overall impact, something that maybe we, we’re not fully estimating before. Why? When we saw the hot rolled coil index going up, as it is going up today, we were considering that, this should have driven an increase in the, in the welded pipe.

But the import of welded pipe coming in based on the Chinese or Southeast Asia or other sources, flat product, is, let’s say, containing movement in the Pipe Logix for welded. And this is, to some extent, having also an impact on the Pipe Logix for seamless product. Now, the hot rolled coil went up so much, there is clearing the way for some import in the welded product and putting under stress the producer of welding product, based on hot rolled coils coming from the U.S. In my view, this is kind of temporary, because anti-dumping action against import, importation or import of welded will contribute to the gradual alignment of the Pipe Logix to the higher level of the hot roll.

This is not something that we can anticipate immediately for the first quarter, but over time, should be acting, should be a factor.

Arun Jayaram, Analyst, JP Morgan: ... Great. And my follow-up, Paulo, I was wondering if you could just provide us your thoughts on how Argentina could play out in 2026 versus 2025. I know that you’re adding a third frack fleet in Argentina, but give us a sense of how you see things progressing in the ground, because we have seen some IOCs adding rigs in that market.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Well, let me tell you that, as I was saying in the previous conference call, after the election in Argentina, November, the confidence on the investment community is increasing in Argentina, and even the oil and gas companies have been able to finance more than $4 billion, collect financing from different tools that will be used to, let’s say, promote and carry on investment planned during 2026. This process has been relatively gradual, but I think that over the second part of 2026, and also following the biggest investment in the infrastructure, we will see this collection of financial capability will transform into higher level of drilling in the country.

This has been slower than probably we were expecting one year ago, because opportunity are there, but also, the level of country risk stayed a little higher after the election than we maybe were estimating. And this is maybe slowing down, or at least is making more gradual, the pickup or increase. Also, you know, some of these resources have been used for consolidation in the industry, especially by local player. And after this consolidation, the investment will go in operation, in the development. First, some of the acquisition has been completed, and gradually, in this field, drilling will increase. I would expect in the second half of 2026, we will see something moving in this sense.

Arun Jayaram, Analyst, JP Morgan: Great. Thank you.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Part of the drilling containment has been coming by the reduction of the operation in the south part of the country. Now, this is, obvious. There has been a closure of operation in the south, so, the key and the core of it, of everything, will be Vaca Muerta.

Arun Jayaram, Analyst, JP Morgan: Thanks, Paulo.

Conference Operator: Thank you. One moment for our next question. Our next question comes to the line of Sebastian Sherwin from Rothschild and Company, Redburn.

Arun Jayaram, Analyst, JP Morgan3: Yeah. Hi, good morning, and thanks for taking my questions. I’d like to just start on the margin trajectory for Tenaris in 2026. I think, Paolo, you mentioned earlier about the impact of kind of Hot Rolled Coil on ERW margins. I mean, looking at that, I think in the U.S., those have compressed about sort of $350 a ton since August. So I guess that would equate to something like a sort of $35-$40 million quarterly cost headwind, but that will take a while to show up. When does that flow through into COGS, or is it something we shouldn’t really be thinking about as a meaningful impact? Any color there would be helpful.

Then I guess on top of that, and more positively, when we look into the second half of the year, you’ve obviously got a lot of offshore work to materialize. So you mentioned Sakarya, you know, Suriname, and presumably, obviously, that’s high margin. So can we expect you to operate at the top end of your kind of 20%-25% EBITDA margin guidance? Is that realistic going forward through the rest of the year and a kind of second half weighting?

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Maybe, well, maybe, Gabriel, you can give an overview of part of the question.

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: Sure.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Then, eventually, we will ask Guillermo-

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: Yeah

Paolo Rocca, Chairman and CEO, Tenaris S.A.: ... on the other pathway.

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: Sure, good morning, Sebastian. Going to you, the part of your question related to offshore and how they will play out during 2026, I would say that the market in the offshore is quite operating at high levels. We have a strong backlog that we need to execute. As Paulo commented in the opening remarks, we are getting ready to deliver this impeccable execution. These are complex projects that require local deployments. You mentioned the Suriname project. We are building the new service base in Suriname. The first shipments will arrive in June, so we are ready to deploy the OCTG and the Rig Direct services there into the second half of the year. We are also, for example, producing today thermal insulation coating in Nigeria to support the Shell Bonga North deepwater development.

So these are an important part of our focus and attention is in delivering these high-value backlog of orders, and we expect revenues in the offshore in the first half of 2026 to be higher than the second half of 2025. When we talk about the second half, it’s true, we have an important backlog of Sakarya and other projects. Some of these additional awards require FIDs. We see some of the FIDs being announced towards the end of this year or even in 2027. So this will depend, so we don’t have fully confirmed the backlog of second half of 2026, but we are confident that it will be at least as positive as the first half of 2026. So overall, I would say the offshore contribution will be important for Tenaris.

And if you look at the industry projections, the available level of FIDs of deep water, that we are seeing for 2027 are pretty strong, higher than the average of 25 and 26, and we are engaging with our customers early on in those projects, much earlier than the FID. So we believe that we’re in an offshore cycle that is gonna be sustained for multiple years.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Yes. You know, this is very important. When we look at the estimate of the investment in deep offshore for 2027 and 2028, the number, apparently estimation, are showing level of investment in the range of $120 billion in 2028. There are almost 3 times some of the low end years in the past 2-3 years. So long term look promising for this. Now, Guillermo, maybe you can add on the U.S. operation, U.S. region.

Guillermo Moreno, President of U.S. Operations, Tenaris S.A.: Yeah. Thank you, Paolo, and good morning, Sebastian. Well, regarding your question about the trajectory of margins in the U.S., and particularly for our ERW pipes, clearly the recent increase of prices of the hot rolled coil and still the reduction of prices for the same products is putting a lot of pressure on our margins. And that are going to be reflected mainly in the second quarter.

For the following quarters, with all the volatility that we are seeing, it’s more difficult to forecast, as Paolo explained before, but and will depend mainly on the ability of the pipe logistics to recover, that we think that eventually will, based on the push of the cost, Hot Rolled Coil, and the scrap, and also because of the expectation that the import will continue to go down in the future.

Arun Jayaram, Analyst, JP Morgan3: Thank you very much. I really appreciate the color. I’ll, I’ll hand it back now.

Conference Operator: Thank you. One moment for our next question. Our next question comes from the line of Stephen Gengaro from Stifel.

Arun Jayaram, Analyst, JP Morgan4: Thank you. Thanks for taking the question. Good morning, everybody. So two things for me, really. One is, can you talk a little bit about your expectations in 2026 for any, any material changes in working capital, as we sort of try to think about, free cash flow generation? And then maybe aligned with that, what level of cash do you feel like you need on the balance sheet to run the business? Like, at what level’s excess versus what’s sort of normal, necessary operational cash?

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Thank you, Stephen. Well, in general, remember, it’s not only a question of the capital we need to run the business, but we also need to have always in mind that the capital we need to have available for any expansion or opportunity that may come in front. But this is an important consideration for the board, for everybody, when we consider financial strategy in the flows to the shareholder. But as far as the working capital is concerned, I would ask Carlos an overall view, because there are some area, like the receivable from some of the clients that is improving. And so you can give us a view of how you see this.

Guillermo Moreno, President of U.S. Operations, Tenaris S.A.: Sure. Thanks, Paolo. Okay, for the 2026, we expect to be quite neutral in working capital, but we will have some swings over the year, no? Especially in the first quarter, we’re expecting an increase in working capital, mainly driven by our accounts receivable. As you saw during the fourth quarter, we have a big reduction in receivables, mainly driven by collections in some way, big collections from Pemex. I think with Pemex, we have arrived to a level that from now on will maintain or increase a little bit. So we won’t be seeing a working capital reduction coming from there.

Then we are seeing also some terms we are negotiating some terms with customers in the U.S. that might impact a little bit our working capital needs. Also, we are seeing some slight increase in sales for the first quarter that will also imply an increase in accounts receivable.

Arun Jayaram, Analyst, JP Morgan4: Okay.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Great. In terms, in terms of inventory, maybe for managing our, you know, in our balance sheet, the service component of the company is very visible. We have the fixed capital that is slightly higher than our working capital, because in the end, we have a lot of inventory to support our service strategy and our Rig Direct strategy. You think, Gabriel, we can imagine some reduction of this streamlining inventory, or we will be visually you imagine a stable situation here?

Guillermo Moreno, President of U.S. Operations, Tenaris S.A.: In general, Paolo, we are always looking for opportunities to improve, and this is the case. In all our Rig Direct programs, we are managing and,

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: ... and balancing the ability to supply and have the right stock at the right moment, and have efficient working capital, so this is a constant work. We have done an improvement during the year that will continue this year on the working process material, so this is something related to our industrial efficiency, where we have been improving, and we have more room to improve. And then there is a part of steel, as we have this important LSAW pipelines, that we need to buy the steel in anticipation. So typically, there is a longer lead time on these large pipelines that are also reflected throughout the year. But this is an area of attention, and we always think there is room for improvement.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: It is important for projects like Sakarya?

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: For example.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Long term, a long period of time.

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: Yes.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: And also our operation may demand working capital for serving ADNOC. I know we have a long operation and there’s stock demand,

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: We are serving every month, 550 rigs worldwide, so this requires to have the right material close to this rig.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Serving 550 rigs every day implies to keep all the inventory, even in remote region, or at least like in the Gulf. But still, you know, working every day to understand how we can optimize this, but by the way. Okay. Thank you.

Arun Jayaram, Analyst, JP Morgan4: Thank you. No, that’s very helpful. Thank you. Thanks for all the color.

Conference Operator: Thank you. One moment for our next question. Our next question comes from the line of Alessandro Pozzi, from Mediobanca.

Alessandro Pozzi, Analyst, Mediobanca: Hi, thank you for taking the questions. The first one is really going back to the Q2 guidance. You mentioned a bit of an impact from higher raw material costs. I was wondering if you could perhaps quantify, give a sense of what that could be in Q2? And also, as we look throughout the year, I was wondering if there is any quarter where we could see an impact from mix, for example, more line pipe versus seamless, and having an idea of the cadence of line pipe volumes, I think could be quite interesting. And also on maintenance, whether you have any big maintenance quarters. Second question on Argentina. Can you comment on the level of competition that you’ve seen there?

We’ve seen an Indian company getting a contract for a pipeline, and I was wondering your thoughts about the competition there, as volumes, as you pointed out, are going up, possibly from second half. Thank you.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Thank you, Alessandro. Well, on the first point, there is a, let’s say, the impact of the role. You know, when we look at the medium term, in term of this, we always keep follow basically four point: the Pipe Logix for seamless, the Pipe Logix for welded, the cost of hot-rolled coil, and the cost of scrap. So on these four variables that are moving are acting on our, let’s say, the indicator in the formula of our co-contract many times, and also the costs that are underlying. Up to now, I mean, what we see is an increase in the c- in the hot-rolled coils that is not followed by the Pipe Logix in welded, because there is import from companies that could stay below the line of price, even paying 50%.

This is sitting in our, to some extent, in our margin, but we think that this would be the reaction by the Pipe Logix, some anti-dumping action to contain import. And I will ask Guillermo, if you see this happening in a medium term, I mean, when we can recover the increased cost of the hot-rolled coils in our top line?

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: Yeah, I think that, I’m following what I said before. I mean, remember, there is always a lag between the Pipe Logix and how they reflect in our prices. So normally, we have one quarter delay. And while the impact of the hot-rolled coils, it comes sooner than that. Our expectation would be that we should start to see some reaction in Q3, but particularly in Q4.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Yeah. Thank you, Guillermo. Now, on the line pipe seamless, after the acquisition of Schikor, the line pipe for us is very relevant, and we are, I think, very competitive. But maybe, Gabriel-

Alessandro Pozzi, Analyst, Mediobanca: Yeah.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: You see, some changes in the balance between two?

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: Yes, Paolo. Alessandro, regarding your question about the cadence of the pipeline projects, I would say that it’s quite stable during the four quarters of this year. This is the visibility that we have today, and pretty much in line in volumes with what we had on 2025, where we had important projects like Sacagawea. I mean, like, Raya in 2025 in Brazil. This year, we are concluding some pipelines in Argentina in the first quarter and second quarter, then we will have Sacagawea in the third and fourth quarter. We have a, I would say, a relatively stable plan of pipelines in Saudi Arabia as well, and then the deep water pipelines that we have in different parts of the world.

I would say there is not a significant imbalance in our shipments of line pipes at all.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Thank you, Gabriel. On the last point, in a tender in Argentina, well, this was a tender for a large project for producing LNG in Argentina. The project is carried on by a private company that is com- let’s say, include different shareholder, but it’s a private company. They made a tender, very open tender to everybody, and basically, we lose the tender because we were higher than the lowest bidder. The bidder, as you were saying, was an Indian company. Things like this happens, obviously. Now, what we are doing, we are analyzing the offer to see if this is an offer that is following the trade practice or is exposed to potentially an anti-dumping case raised by us.

For the time being, we didn’t take a decision here. We are just studying the condition, the condition of the local market for the Indian company, the condition of the pricing of this, because we think this is important. We also remember that, you know, Argentina had signed an agreement with the United States, in which both parties are committing themselves to address the unfair trade practices in both countries. It is logical for the U.S. to advance or introduce clause of this in the relation with different regional, different area. And this is part of the agreement, the reciprocal trade and investment agreement between Argentina. So we think there should be a good environment to analyze the specific situation of this offer and this tender.

Alessandro Pozzi, Analyst, Mediobanca: All right. Thank you. I don’t know if I can squeeze in a last one on Venezuela. In your opening remarks, you mentioned that Chevron is ramping up drilling activities. Could you quantify the Venezuela opportunities short term, longer term for Tenaris?

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Yes, on this, Gabriel, you follow closely this.

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: Yes, Alessandro, Venezuela, clearly the situation is evolving, it’s a dynamic environment, but clearly there are signs that things are gonna move positively with the hydrocarbons law and the recent OFAC licenses, I think there are clear signs that some resumption of activity will occur. Today, Tenaris is in a unique position. We are fully serving Chevron, the only major that is operating in Venezuela. They have a plan to accelerate rigs and demand for tubulars, and we are ramping up for that. This is today something limited, but we expect to expand into 2026. So we are also following the licenses of the other majors that might be coming back to Venezuela soon.

So this is, I would say, still in the $50 million for 2026, but with a clear perspective of a higher potential into 2027, and when maybe more clear plans about the other majors are materialized. But overall, a big upside potential in the midterm, depending on how things evolve.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Yeah.

Alessandro Pozzi, Analyst, Mediobanca: Okay, so you say-

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Remember, Chevron will not be all alone. There will be other company moving, and I think our position in Venezuela is unique. Remember, we in Venezuela, we’re operating the only seamless pipe plant, until the plant was expropriated in 2008 by the government, by Chavez. And at that time, we were the company serving the oil industry in Venezuela, so we also have human resources or people that are familiar with the operation in Venezuela, the service, the complexity of this, the product demand and so. Even if a lot of time passed, but we still, I think, we have a very competitive and differentiated position.

Alessandro Pozzi, Analyst, Mediobanca: All right. Thank you. Sorry, did you say $15 million EBITDA, 1, 5?

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: $50 million of revenue, 50.

Alessandro Pozzi, Analyst, Mediobanca: Revenue, all right. Yeah. Thank you very much.

Gabriel Podskubka, Chief Operating Officer, Tenaris S.A.: Welcome.

Conference Operator: Thank you. One moment for our next question. Our next question comes from the line of Luigi De Bellis from Equita SIM.

Luigi De Bellis, Analyst, Equita SIM: Hi, good morning. Thank you for taking my question. Just one for me. On the Middle East and Mexico, could you share your view on the evolution for the coming quarter for both Middle East and Mexico? Thank you.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Thank you, Luigi. Well, starting, let’s say from Mexico. Mexico, there has been a number of positive advance in supporting Pemex, the government capitalize Pemex with a program of $20 billion. That is important. Now Pemex is also issuing bonds and getting accessing to the market for important sum, like $1.7 billion. I mean, relevant access with a government guarantee. Now, what we do not see yet is the organi- the definition of the plans that Pemex will execute during 2026. We do not have clear indication of this. The private company are moving slowly, and some of the group is moving. Obviously, Woodside in the Tryon is moving on.

But some of, let’s say, the contract that may have enabled private company to come and develop the resources, in my view, this is moving relatively slowly today. Maybe by the end, the middle of 2026, we will have a better understanding of how they will organize, let’s say, the development of the clearly huge resources that Mexico has. Now, the question on Middle East, medium-term vision, I think, Gabriel, you also may comment on this.

Guillermo Moreno, President of U.S. Operations, Tenaris S.A.: Yes, sure. Luigi, for the question on Middle East, I would say that, there’s not much change on what we have been reporting the last couple of quarters. Activity remains high. All the main key countries are investing. We have a strong position there with our long-term agreements in Saudi, UAE, Qatar, and part of the market in Iraq as well. So I would expect our revenues and shipment in the next quarters, first and second quarter of 2026, to be pretty much in line with the last two quarter of 2025. The only noticeable news is a probable uptick of drilling activity in Saudi.

This is still to be confirmed, but, probably during the second quarter of 2026, or maybe later in the year, we will see a comeback of rigs in Saudi, which reduce rigs during 2025. So we’ll monitor that, and there could be a potential upside, but for the second half of this year on the side.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Thank you.

Luigi De Bellis, Analyst, Equita SIM: Thank you.

Conference Operator: Thank you. One moment for our next question. Our next question comes from the line of Marco Cristofori from Intesa.

Marco Cristofori, Analyst, Intesa: Good morning, everyone. Thank you for taking my question, which relate on shale oil, shale industry in the U.S. Let’s say that since the end of 2023, we’ve seen declining rig counts, but a growing crude output. So, and also breakeven are going strongly, strongly down according to oil measure. So do you think that this trend could allow a further increase of your volumes in the U.S.? And secondly, there are several insight that the shale in the U.S. could reach a plateau in the second half of 2027. So, how do you see the evolution of the shale industry in the U.S.? Thank you.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Yeah. Thank you, Marco. I would ask to Guillermo to give his view on on the evolution of this. In the question of plateau, frankly, I wouldn’t I don’t think we are able to predict the plateau. It will depend on the overall price of oil around, and there are many issue that are unpredictable concerning the major production reason, region, and so on and so forth. So US the plateau has been forecasted in the past at a lower level, and it’s continuously surprising us with higher. And so I wouldn’t bet on where this number will be in 2027. Guillermo, on the question of the productivities.

Guillermo Moreno, President of U.S. Operations, Tenaris S.A.: Yes. I mean, as you said, I mean, the operators in the U.S. have been increasing the, their efficiency and productivity big time in the last two years. So with a much less number of rigs, they are not only producing more, but they are drilling almost the same amount of wells, and they are even going longer. So we are seeing much less risks, but more production, and slightly reduction in the consumption of OCTG compared to what we used... I mean, so there is no, no such correlation that we used to have with the rig count. Now, looking forward, we still see, kind of a stable market for 2026 compared to 2025. We may see some reduction of activity, slight reduction in oil, offset by an increase of, activity in, in gas.

As Paolo said, difficult to predict about production. Everybody’s talking about plateauing, but at the same time, we see them becoming more creative and producing more oil from each well, with the new technologies in terms of fracking, but also in terms of the level of chemicals they use. We need to see up to where the innovation of the industry can go. Clearly, if we are not at the peak, we are not far from it, with this level of activity and rig count. The other variable that we need to take into account is that during the last two years, there has been a reduction of drilled but uncompleted wells. Some of the increase of the activity was also coming from wells that were previously drilled but not completed.

The level of inventories of those wells has gone, has come to kind of a bottom, so we don’t expect much more of this in the coming quarters.

Marco Cristofori, Analyst, Intesa: Okay. Thank you.

Guillermo Moreno, President of U.S. Operations, Tenaris S.A.: Thank you.

Conference Operator: ... Thank you. One moment for our next question. Our next question comes from the line of Kevin Roger from Kepler Cheuvreux.

Kevin Roger, Analyst, Kepler Cheuvreux: Yes, good evening. Thanks for taking the time. I just have one question to follow on the US and all those stories on the tariff implemented by the Trump administration, and notably on the recent news flow that the Trump administration could reduce the tariff on steel and aluminum. I was wondering if you comment a bit more on what should be the implication on your side from a potential reduction on the tariff, if, for example, we come back to a 50% steel tariff to a 25 or something like that, just to understand the potential impact on the US OCTG market, if we move in that direction, please.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Thank you, Kevin. Well, we don’t know about which is the—I mean, we only have an article on the newspaper. We do not have a written definition. If I should say, the issue may come from the impact of the U.S. economy, of the extension of the 232 to the derivative of steel. There are many product derivative of steel, which means that they contain steel, there are basically affect price level in the states, but are not having a beneficial impact of industry in the state that is not producing this. Now, this universe of derivative increase so much that I think the comment of Trump maybe are just indicating a willingness to reshape the what is considered derivative and what is not.

Remember, there has been stages of expansion of the definition of derivative 1, 2, and before going to the third, he is considering what it would be, let’s say, not creating undue distress in the pricing system. So, this is what I understood. He will reconsider the derivative more than reconsidering the level of 50 to 25, because this is a key component of the 232. I don’t see this to change.

Kevin Roger, Analyst, Kepler Cheuvreux: Okay, perfect. Understood. Thanks.

Conference Operator: Thank you. One moment for our next question. Our next question comes from the line of Jamie Franklin from Jefferies.

Jamie Franklin, Analyst, Jefferies: Hi there, and thank you for taking my questions. So firstly, and apologies if I missed the answer to this one, but I just wanted to focus on your other business segments. Obviously a big revenue and margin recovery in 1Q, driven by your fracking and coil tubing services in Argentina. Can you just talk about how you expect that to trend through 2026, and whether we can expect a similar contribution in the first and second quarter, and beyond that? And then the second question, just if you could give us an update on your CapEx expectations for 2026 and kind of an outline of where you expect to be spending. Thank you.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Thank you, Jamie. On the oil and gases, I was saying, during the second part of 2026, we are considering that the activity of oil and gas fracking should go up. The drilling activity will also pick up later on. There will be more need to frack. We are just bringing in one additional set of fracking, because we are anticipating some increase by the end of the year. And this will should drive to some increase on our activity in the second half of 2026. This is basically the position on this. The other point-

Jamie Franklin, Analyst, Jefferies: Cap.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: CapEx, I mean, CapEx will be more or less in line with what we have been spending in 2025. Looking at the forecast, we see even something lower, but I imagine that during the year, new need may come out. Usually there is something that is coming out from specific intervention. So there will be no something lower when we look at this from a planning point of view today, but maybe in the end, we will be close to the level of today.

Jamie Franklin, Analyst, Jefferies: Okay. Very clear. Thank you.

Conference Operator: Thank you. At this time, I’m showing no further questions. I would now like to turn the conference back over to Giovanni Sardagna for closing remarks.

Paolo Rocca, Chairman and CEO, Tenaris S.A.: Well, thank you, Gigi, and thank you all for joining us today. Bye.

Conference Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect.