French steelmaker Vallourec announced Wednesday that during Q4, sales were up 19 percent to €1.6 billion (US$2.05 billion) over Q3 of fiscal 2011, with sales for the full year increasing 18 percent to €5.3 billion (US$7.02 billion). The increase in sales can be attributed to the positive price and mix effect of strong sales in the oil and gas and power generation markets. Earnings before interest, taxes, depreciation, and amortization (EBITDA) for Q4 was up 12 percent, over Q3, to €254 million (US$336 million) and representing 16.4 percent of sales. The full-year EBITDA rose 2 percent to €940 million (US$1.2 billion) and representing 17.7 percent of sales.
North America--along with Europe--led in sales by region for the year posting 21 percent more sales in 2011 than in 2010, while South America only increased by 4 percent during 2011. The large increase in North American sales can be attributed to strong drilling activity in the shale basins, which drove demand for OCTG and line pipe. The reason for the slow growth in South America is that the activity in Brazil had slowed due to the slowdown in industrial growth and increased competition--although demand for oil and gas products sustained.
Philippe Crouzet, Chairman of the Management Board commented about the 2011 results: "2011 was a year of strong growth in our activity, with both production and sales increasing by close to 20 percent. Most of our plants operated at high utilization rates, and a high degree of flexibility has been restored." Crouzet continued about current projects: "In Brazil, our new plant VSB was inaugurated in September, its first tubes delivered in Q4, and the qualification and ramp-up process will continue through 2012. In the USA, the construction of our new pipe mill will soon be completed with first sales expected in the summer."