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TMK Announces 1Q 2014 Operational Results

EquityStory.RS, LLC-News: OAO TMK / Key word(s): Miscellaneous
TMK Announces 1Q 2014 Operational Results

24.04.2014 / 09:09

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April 24, 2014 PRESS RELEASE

TMK Announces 1Q 2014 Operational Results

The following contains forward looking statements concerning future events.
These forward looking statements are based on current information and
assumptions of TMK management concerning known and unknown risks and
uncertainties.

TMK, one of the world's leading producers of tubular products for the oil
and gas industry, announces its operational results for the first quarter
of 2014.

1Q 2014 Highlights

- In the first quarter of 2014, TMK shipped a total of 1,022 thousand
tonnes of steel pipe to consumers, down 3% and 8% year-on-year and
quarter-on-quarter respectively. The drop in shipments is mainly due to
lower demand for seamless and welded line pipe, as well as large
diameter pipe (LDP).

- Seamless pipe shipments amounted to 626 thousand tonnes, which is flat
year-on-year but down 3% quarter-on-quarter.

- Welded pipe shipments in the reporting period fell by 9% year-on-year
to 396 thousand tonnes. It was LDP and welded line pipe segments that
saw a decline. Welded pipe shipments dropped by 16% quarter-on-quarter.

- The total shipments of OCTG pipe, TMK's core product, remained flat as
compared to the previous quarter and were up 13% year-on-year, reaching
491 thousand tonnes.

- Shipments of premium connections in the first quarter of 2014 amounted
to 193 thousand joints, up 18% year-on-year, but down 4%
quarter-on-quarter.

- Decrease in shipments and less favorable product mix of OCTG pipe
(including premium connections) and seamless line pipe, coupled with
the rouble devaluation, will put some downward pressure on TMK's 1Q
financials in comparison to the expectations.

1Q 2014 Summary Results

(thousand tonnes)

Product         1Q 2014   4Q      Q-o-Q, %   1Q 2014   1Q 2013   Y-o-Y, %

                          2013

Seamless Pipe

                    626     642        -3%       626       625       0.1%

Welded Pipe

                    396     471       -16%       396       433        -9%

Total

                  1,022   1,113       - 8%     1,022     1,058       - 3%

including

OCTG                491     493      -0.5%       491       434        13%

1Q 2014 Market Overview and Performance by Division

Russian Division

By 2014, key tubular products consumers had stocked up considerable
inventories, which reduced demand for oil and gas pipe and and industrial