Tenaris 1st-quarter profit down 5.7% on higher expenses
BY DEBBIE CAI
LUXEMBOURG CITY -- Tenaris first-quarter earnings fell 5.7% as the Luxembourg-based steel-pipe manufacturer reported higher expenses.
The company, which has a big presence in Argentina, has been benefiting from strong demand from exploration-and-production companies, as oil and gas drilling increasingly is led by the development of deepwater and unconventional energy reserves. But revenue has generally slowed in recent quarters and the latest period marks the first decline in the company's bottom-line after more than three years of double-digit growth.
In the latest period, sales in North America, which account for slightly more than half of the total, shrank 9.9% to $1.14 billion. South American sales jumped 29% to $595 million.
Tenaris reported a profit of $422.7 million, or 72 cents an American depositary share, down from $448.2 million, or 74 cents an ADS, a year earlier.
Net sales improved 2.3% to $2.68 billion.
Analysts polled by Thomson Reuters had predicted earnings of 73 cents on revenue of $2.74 billion.
Gross margin widened slightly to 38.6% from 38.4%.
In the latest period, expenses rose 8.9% to $479.3 million.
The ADSs were up 18 cents at $44.16 in after-hours trading. The stock is up 13% over the past six months.