Sebastian Sherwin

Sebastian Sherwin inquired about Tenaris's margin trajectory for 2026, specifically the impact of hot rolled coil on ERW margins, asking for quantification of potential cost headwinds and when they would flow through COGS. He also asked if the company expects to operate at the top end of its 20-25% EBITDA margin guidance in the second half of 2026, driven by offshore work.

Answer

Gabriel Podskubka, COO, confirmed a strong offshore market and backlog, with H1 2026 offshore revenues expected to be higher than H2 2025, and H2 2026 at least as positive. He highlighted strong deepwater FIDs projected for 2027 and 2028. Guillermo Moreno, President of U.S. Operations, stated that the recent increase in hot rolled coil prices and reduction in ERW pipe prices are pressuring margins, mainly reflected in Q2 2026. He expects some recovery in Q3 and Q4 due to Pipe Logix recovery and reduced imports.

Sebastian Sherwin inquired about Tenaris's margin trajectory for 2026, specifically the impact of hot rolled coil on ERW margins and when this might flow through to COGS. He also asked if the significant offshore work expected in the second half of 2026, including projects like Sakarya and Suriname, would enable Tenaris to operate at the top end of its 20%-25% EBITDA margin guidance.

Answer

Gabriel Podskubka, COO, stated that the offshore market is operating at high levels with a strong backlog, expecting higher offshore revenues in H1 2026 compared to H2 2025. He noted that some H2 2026 projects depend on FIDs, but the long-term offshore cycle looks sustained. Guillermo Moreno, President of U.S. Operations, explained that increased hot rolled coil prices and reduced ERW pipe prices are pressuring margins, primarily impacting Q2 2026, with potential recovery in Q3 and Q4 based on Pipe Logix and import trends.