Vallourec (VK) Q1 2025 earnings summary

Executive summary

• Q1 2025 EBITDA reached €207 million with a 21% margin, at the high end of guidance, supported by premium positioning and strong international bookings.

• Net cash position improved to €112 million, marking the tenth consecutive quarter of positive cash generation, supported by robust cash flow and working capital release.

• Major international contracts secured and US market prices increased, though full tariff impacts are not yet reflected.

• Announced planned divestment of Serimax to streamline focus on core premium tubular solutions.

• Achieved investment-grade rating from Fitch for the first time in a decade, with positive outlooks from S&P and Moody's.

Financial highlights

• Q1 2025 revenues were €991 million, flat year-over-year; EBITDA at €207 million (20.9% margin), net income group share at €86 million.

• Adjusted free cash flow was €168 million; total cash generation at €104 million; net cash improved to €112 million from €21 million in Q4 2024.

• Basic EPS at €0.37, diluted EPS at €0.34, both down year-over-year.

• Industrial margin at 29.5% (down 2.9pp YoY); selling, general & admin expenses at 8.2% of revenue.

• Gross debt reduced to €975 million; liquidity stable at ~€1.9 billion, including €1,098 million cash.

Outlook and guidance

• Q2 2025 EBITDA expected between €170 million and €200 million.

• H2 2025 EBITDA anticipated to improve over H1, driven by higher international Tubes shipments, pricing, and cost savings.

• Tubes business: Q2 volumes flat to slightly lower, EBITDA/ton flat to slightly higher; H2 international shipments and EBITDA/ton expected to improve.

• Mine & Forest segment results expected to normalize from Q1 highs due to softer iron ore prices; full-year production target is 6 million tonnes.

• H2 expected to outperform H1 based on conservative assumptions.