Tenaris S.A.

Good day and thank you for responding by. Welcome to the first quarter 2021 Tenaris S.A. Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. If anyone should require assistance during the conference, please press star, then zero on your touchstone telephone. As a reminder, this conference call is being recorded. I would now like to turn the conference over to your host, Speaker Giovanni Sardegna, Head of Investor Relations. Please go ahead, sir.

Giovanni Sardegna Thank you, Nora, and welcome to Tenerife 2021 Post-Quarter Conference Call. Before we start, I would like to remind you that we will be discussing forward-looking information in this call, and that the actual results may vary from those expressed or implied during this conference call. With me on the call today are Paolo Rocca, our Chairman and CEO, Alicia Mondolo, our Chief Financial Officer, Guillermo Vogel, Vice Chairman and member of our Board of Directors, Germán Curá, Vice Chairman and member of our Board of Directors, Gabriel Podskubka, President of our Eastern Hemisphere Operation, and Luca Zanotti, President of our U.S. Operations. Before passing over the call to Paolo for his opening remarks, I would like to briefly comment our quarterly results. Our sales in the first quarter reached $1.2 billion, down 33% compared to those of the previous year, but up 5% sequentially, mainly driven by a recovery in sales in North America, partially offset by lower sales in the eastern hemisphere. Average selling prices in our tubes operating segment declined 4% compared to the corresponding quarter of 2020, and 5% sequentially, mainly due to a poorer geographic sales mix. Our EBDA for the quarter, which included $23 million of additional costs associated to the winter storm in Texas, was up 2% sequentially to $196 million, reflecting continued improvement in our industrial performance. Our EBDA margin was stable at around 17%. Our quarterly net income of $106 million benefited from a strong contribution from our investment in Ternium. During the quarter, working capital increased by $83 million, mainly due to higher inventories, which reflect the increased level of activity. With operating cash flow of $70 million and capital expenditures of $45 million, our free cash flow amounted to $25 million. Our positive financial position remained flat during the quarter at around $1.1 billion. Now, I will ask Paolo to say a few words before we open the call to questions. Thank you.

Thank you, Giovanni, and good morning to all of you. Our first quarter results show the progress we are making with our repositioning in the U.S. market, despite the impact of the Texas freeze, which affected production volume as well as costs. The living activity has been increasing steadily through the first part of the year, though it remains significantly below pre-pandemic levels and is supported by current oil and gas price levels and operator cash flow.