TMK Announces 9M 2013 Operational Results

TMK, a leading global manufacturer and supplier of steel pipes for the oil and gas industry, announces its operational results for 9 months of 2013

1. TMK shipped a total of 3,200,000 tonnes of steel pipe to customers in the first nine months of 2013, up 1.7% YoY, on the back of stronger demand for welded OCTG pipe and large diameter pipe. Shipments fell by 2.1% QoQ.

2. Seamless pipe shipments fell by 2.8% YoY to 1,807,000 tonnes in the first nine months of 2013. Shipments fell by 9.0% QoQ to 563,000 tonnes due to scheduled repair of rolling mills at Seversky Tube Works and Volzhsky Pipe Plant.

3. Welded pipe shipments rose by 8.3% YoY up to 1,393,000 tonnes in the first nine months of 2013, mainly driven by increasing demand for LDP and line pipe from Russian customers as well as welded OCTG in the USA. Compared to the Q2 of 2013, the Q3 welded pipe shipments were up by 7.1%.

4. Total OCTG shipments, TMK’s core product, increased by 4.2% YoY, but were down 4.1% QoQ.

5. Shipments of premium connections totaled 573,000 joints in the first nine months of 2013, up 22.7% YoY. Shipments were down 1.9% QoQ.

Russian Divison

In the first nine months 2013, TMK’s Russian division shipped 2,239 thousand tonnes, up 1.9% year – on – year. Shipments fell by 2.9 % to 731 thousand tonnes quarter – on – quarter. In the first nine months of 2013, LDP shipments totalled 350 thousand tonnes, up 12% year – on – year , but down 7.0% quarter – on – quarter, mainly due to some pipeline projects being finalised in the first half of 2013 and, for new projects, postponed to a later date. Due to ever increasing oilfield – to – storage transportation demands in Russia, TMK’s Russian division saw a rise in welded line pipe shipments by 24 .4% year – on – year and by 1 4. 5% quarter – on – quarter while shipments of seamless OCTG pipe remained almost flat year – on – year but down 10 .2 % quarter – on – quarter as a result of the scheduled repair of rolling mills at the Russian plants mentioned above. Shipments in the welded and seamless industrial pipe segments were in line with the previous year but increased quarter – on – quarter by 2 5.8 % and 8 .0 %, respectively, driven by a rising demand from the machine building and construction industries in the third quarter of 2013.