Tenaris, the largest global producer of steel pipes for the oil industry, said its profit fell 81 percent in the fourth quarter of 2008, with net profit at US$114.5 million compared to the same period the previous year, when profits reached US$596 million.
The decrease is due in part to the devaluation of their assets which amounted to US$502.9 million and the economic meltdown in the United States, the firm reported in an earnings report published by the Buenos Aires stock exchange. Chesterfield, Missouri-based Maverick Tube Corp., which Tenaris acquired in 2006, was their most devaluated asset.
The firm also cited the drastic decrease in oil prices, from $140 per barrel in July to about $40 in the current marketplace, as a main factor that has damaged the value of its assets and demand for its products.
On the bright side, the company's net sales increased 23 percent from Q4 '07 to Q4 '08, and the company increased its full-year profits by 10 percent from 2007 to 2008. Tenaris added, "2008 was a year of strong growth as we consolidated our product offer in the integrated and expanding North American market."
Luxembourg-based Tenaris, which conducts operations in five continents, is controlled by the Argentinean group Techint.