Vallourec's profit for the first quarter of 2018 increases on higher US prices

The French steel tube maker,?Vallourec, reported on Wednesday a 4% increase in its first-quarter core profits. This was within the range of guidance it had previously provided. Its profit growth was boosted by higher market prices in America. Vallourec reported earnings before interest taxes, depreciation, and amortization of $220 million for the quarter January-March. It had expected them to be between 165 and 195 millions euros (194 and 229 million dollars) when it announced its fourth-quarter results.

From the beginning of January, the company changed its reporting currency. It went from using the euro to U.S. dollars.

Vallourec, a company that provides tubing to oil and gas, low-carbon energy, and industrial markets, reported stable volume in North America. However, higher U.S. prices have more than offset increases on energy and raw materials costs.

The company stated that the impact of the Middle East situation was contained as it observed resilient customer activity on its key markets within the region.

Vallourec's revenue from the Middle East accounted for more than 25% of its total revenues. Its main clients are?Aramco, in Saudi Arabia, and ADNOC, in the UAE.

The CEO Philippe Guillemot told journalists that "these customers have pipelines which 'enable them to export oil without having to?pass through the Strait of Hormuz. Their business was buoyant in the first quarter, and it is expected to be so again in the second quarter."

(source: Reuters)