Vallourec S.A.

Good day and welcome to Valorex 2026 first half results presentation hosted by Philippe Guillemot, Chairman of the Board and Chief Executive Officer, and Nathalie Delbreuve, Chief Financial Officer. For the first part of the web conference, all participants will be in listen-only mode. During the question and answer session, you may ask questions by dialing pound key five on your telephone keypad to enter the queue. and now I'd like to hand the call over to Daniel Thomson, Director of Investor Relations. Please go ahead, sir.

Thank you, Grace. Good morning, ladies and gentlemen, and thank you for joining us for Valeric's second quarter 2026 results presentation. I'm Daniel Thomson, Director of Investor Relations at Valeric. I'm joined today by Valeric's Chairman and Chief Executive Officer Philippe Guillemot and Valeric's Chief Financial Officer Nathalie Delbreuve. Before we begin our presentation, I would like to note that this conference call will be recorded. A replay will be available following the call. You can find the audio webcast on our investor relations website. The presentation slides referred to during this call are also available for download here. Today's call will contain forward-looking statements. Future results may differ materially from statements or projections made on today's call. The forward-looking statements and risk factors that could affect those statements are referenced on slide two of today's presentation. These are also included in our universal registration document filed with the French financial markets regulator, the AMF. This presentation will be followed by a Q&A session. I'll now turn the call over to Philippe Guillemot.

Thank you, Dan. Welcome, ladies and gentlemen, and thank you for joining us to discuss Valourec's second quarter 2026 results. You can see today's agenda on slide three. Now let's turn to slide five to discuss our results and outlook. In the second quarter, we delivered a strong performance once again. with group EBITDA of 190 million U.S. dollars in line with the midpoint of our guidance and at a solid 21.4% margin. Despite sequentially lower volumes in our intentional business, Qube's profitability remains highly robust at 722 U.S. dollars per ton, similar to the level of Q1. This highlights the strength and resilience of our business model amidst a complex operating environment in the Middle East. Our cash conversion continued to improve year on year, with more than 60% of EBITDA converted to cash this quarter. We ended the period with a net cash balance of US$183 million, the highest level since 2009. Turning to the outlook, we expect tubes volumes to increase and ABJ per ton to decrease sequentially in the third quarter, reflecting a less favorable mix and timing of additional costs related to Middle East shipments to be reimbursed largely in the coming quarters. In mine and forest, production sold is expected to be around 1.4 million tons. As a result, we expect Q3 EBDA to range between 170 and 210 million U.S. dollars, with a wider range reflecting the increased uncertainty related to the renewed hostilities in the Strait of Hormuz. Turning to our markets. In the US, higher activity levels and constrained imports due to the existing tariffs and ongoing trade investigations are supporting solid utilization of our assets. Market pricing continues to improve, reflecting favorable OCTG fundamentals. with inventory levels across the board now below the five-year average. In international markets, our primary customers in the Middle East are leveraging local supply chains such as ours to accelerate their activity. At the same time, select customers who are more directly affected by disruptions in the Strait of Hormuz continue to defer deliveries as they await greater operational visibility. Global tendering activity remains high, and we see customers moving ahead with project developments, notably in offshore markets. We announced several important high-value contract awards in this domain over the quarter, including the largest line-pipe contract in Valourette's history for ExxonMobil, Guyana's Deepwater, Hammerhead and Longtail projects. These and other recent bookings underpin higher invoicing from late 2026 with more contract announcements to come in the second semester this year. Turning to capital allocation, with the announcement of a €2.05 per share interim extraordinary dividend to be paid in August and the completion of €110 million in share repurchases in H1 2026, We are cementing our position as one of the most shareholder-friendly companies both in our peer group and the wider market. After a quarter-end, we were pleased to announce a final agreement with our partners for the exit of our 20% stake in HKF. In New Energies, our deep dive presentation hosted in June highlighted Valorex's advantage position as a key enabler in the rapidly growing geothermal market where demand for premium tubular solutions continues to increase. We believe this market could reach a scale comparable to the seamless OCTG markets of South America or Africa by 2030 While in the near term, geothermal customer demand over the next six months is expected to exceed the prior 12 months total. Finally, to support our customers growing pipeline of offshore deep and ultra deep water developments, Valorec is investing in advanced coating and thermal insulation technology that are increasingly critical to flow assurance and project economics. I will discuss our advanced coating solutions offering later in the presentation. Let's move to the market environment on slide seven. In international markets, drilling activity was stable outside the Middle East in the second quarter with an uptick in June. In the Middle East, Offshore activity rebounded from the low point in March back to pre-war levels, while onshore activity remained lower, primarily driven by countries with limited export routes outside the Strait of Hormuz. Market pricing continued to increase during the same quarter, compensating for increased costs associated with the disruption in the Middle East. Turning to slide 8 for a closer look at the Middle East. You can see on the chart on the left that drilling activity in Saudi Arabia continues to accelerate, while activity in the UAE mostly recovered to pre-war levels by June. As a reminder, these two countries account for around two-thirds of drilling activity and value-added volumes in the region. Meanwhile, activity in other Middle East countries remains almost 30% or 60 rigs below February's level, with Iraq most impacted today. While there is considerable uncertainty in the near term around the timing of the full reopening of the Strait of Hormuz, We continue to expect a region-wide rebound in drilling activity as countries seek to maximize their domestic production capacity. We already see strong appetite from both NOCs and IOCs to collaborate to achieve higher production levels in the coming years, with a few projects to bypass the strait of our moves already underway. This activity rebound, combined with much-needed restocking of TBRs, will drive higher OCTG demand over the coming quarter. Turning to slide 9, we can see the latest data from Heistat pointing to a significant increase in major project approvals of final investment decisions in the remainder of 2026 through 2028 in both onshore and offshore markets, some of which have already been approved since the publishing of this report. As energy security and diversity of supply becomes a top priority amongst nations, we are seeing our customers progressing the development of their project portfolios with increased urgency. These projects are expected to drive a multi-year increase in global upstream capex through 2030, with a growing share of offshore and unconventional projects in the oil and gas supply stack, both of which exhibit higher decline rates than conventional onshore developments. We believe these trends placed to our strength, increasing both OCTG demand and the need for premium tubular solutions in deeper, higher pressure and unconventional developments. Let's turn to slide 10 to discuss how Valourec is increasingly well positioned to capture this growth in offshore and deep water in the coming years. To address the growing pipeline of offshore deep water projects in our customers' portfolio, Valorec acquired and successfully integrated ThermoTile do Brasil last year. Since then, we have seen many commercial successes driving high utilization of this line pipe coating asset. In May this year, we announced breakthrough contracts from ExxonMobil Guiana under our long-term agreement signed in 2021. Under this contract, Valorec will deliver more than 40,000 tons of line pipe, of which 22,000 tons will be insulated with Exxon's Proxima resin systems with Goldilocks Subsea insulation technology. This represents Valorect's largest ever line pipe contract. Valorect has become the first licensee of these technologies by ExxonMobil and we are investing in an upgrade of our line pipe coating assets in Serra, Brazil. Other commercial successes enabled by our advanced coating expertise and integrated offering include a major contract for Azulay Energy Spage Development Offshore Angola, involving one of the thickest thermal insulation systems ever implemented in the subsea industry. Further, we announced last week A large contract by Allseas for the Atapu II project offshore in Brazil. In the chart on the right, you can see that after a temporary lower period over 2024 to 2026, the line pipe market is expected to accelerate from 2027 again. Importantly, the percentage of this market requiring thermal insulation coating is also seen increasing, with up to 45% of offshore projects worldwide expected to incorporate thermal insulation coating. As you can see from the chart, our manufacturing base in Brazil is ideally positioned to service the largest offshore markets requiring this technology. Moving to the North American market on slide 11. On the element front, drilling activity has begun to respond to higher prices with the U.S. rate increasing by around 7% versus pre-war levels. The increase in activity combined with restrained import volumes, which I will cover on the next slide, is driving a reduction in OCTG inventories across the board, which are declining below the five-year average. As a result, OCTG pricing continues to increase reflecting favorable supply-demand dynamics which we expect to continue based on the strength of our recent bookings. Turning to imports on slide 12. On the left chart, you can see that OCTD imports remain well below the 2025 level despite higher prices with seamless imports accounting for less than 10% of total shipments in the US. We expect the investigation into alleged unfair trade practices from Austria, the largest single source of seamless imports, as well as Taiwan and the EU to continue driving greater market share for local producers such as Valoret. We will see the benefit of higher prices in our P&L from the third quarter and more so in the fourth quarter. Overall, we see an increasingly positive oil and gas market ahead in the US, complemented by rapidly growing demand from geothermal customers. I will now hand the call over to Nathalie to comment on our financial results.