2012
2
Contents
� Overview and Strategy
� Financial Results
Overview and Strategy
4
� Seamless Steel tubes Company
� Global International Footprint 87% of Sales
� Oriented to the Energy Sector 83% of Sales
� Focus on Special Products and Niches - 63% of Sales
� Strategic Plan 2011-2016 150 Mll Eur investment plan under execution
5
Business Lines
% of Sales*, 2012:
Seamless tubes Automotive Distribution
• Manufacture of Small and Medium size diameter Tubes
• TIER 1 supplier of tubular-shaped components and other autoparts such as suspension "links“
• Distribution of tubular products (carbon and alloy steel, copper, PPR ...), fittings, insulation and related products
• Manufacture of Large size diameter tubes
• Cold rolled seamless steel tubes
82% 9%8%
* Other businesses: 1% of sales
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Core Seamless Steel Tube Manufacturing Business
� Production sites located in the Basque Country (Nor thern Spain)
� Wide portfolio of products
� Production process vertically integrated
Tubos Reunidos Industrial
Manufacture of small and mid-size
diameter tubes
Productos Tubulares
Manufacture oflarge diameter
tubes• Diameter: 26.7 – 180 mm. (6-120mm
upon cold-drawn).
• Thickness: 2.6 – 19 mm.
• Carbon, alloyed and high alloy.
• Diameter: 190-558 mm.
• Thickness: 6.30 – 120 mm.
• Carbon, high alloy and stainless.
69% of sales 31% of sales
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Global Commercial Footprint
25 Agents
9 Delegations
Seamless Tube Business
8
Sales in International Markets
% of Seamless Steel Tubes sales, €M% of Consolidated Sales, €M
� Historic Presence in International Markets
� Geographic Diversification
� 87% of Seamless Steel Tubes Sales in International Markets
� 54% of Seamless Steel Tubes Sales out of Europe
57% 57% 58% 63% 65% 69% 75% 78%
2005 2006 2007 2008 2009 2010 2011 2012
Spain International markets
3,3%
8,3%
15,9%
26,8%
33,4%
12,4%
5,0%
7,1%
14,1%
31,3%
29,7%
12,7%
0% 5% 10% 15% 20% 25% 30% 35% 40%
New Markets
Middle East
Far East
North America
Europe
Spain
2012 2011
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Energy Sector
OCTG (Oil Country
Tubular Goods)
Pressure Pipes Line Pipes
Oil & Gas: Drilling, Casing, Tubing
High -Pressure
&Temperature Service: Heaters,
Boilers, Heat exchangers
High Pressure, Fluid
Conduction
Oil & Gas: 44%
Power Generation: 23%
Petrochemicals: 16%
Other: 17%
Energy Sector: 83 % of sales
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Focus on Special Products and in niche segments
63 % of sales (2012)
LARGE DIAMETER TUBES IN HIGH ALLOY AND STAINLESS STEELS
Process pipes for power generation and petrochemicals in extreme conditions
TUBES OF HIGH COLLAPSE RESISTANCE
OCTG: unconventional E&P technologies
TUBES FOR HIGH PRESSURE – HIGH TEMPERATURE REQUIREMENTS
TUBES OF SPECIAL LENGTH: UP TO 27 METERS
HRSG power generation
Heat exchangers for termosolar plants
Critical and super critical boilers for power generation plants
DIVERSIFIED PORTFOLIO
22% 11%
5%25%
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Focus on Special Services: Flexibility
• Medium – size projects
• Spot Market
• Repairs
DELIBERY LEAD TIMES
ORDER SIZES
FINISHING REQUIREMENTS
SPECIAL DIAMETER, THICKNESS AND LENTH COMBINATIONS
FLEXIBILITY
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Strategic Lines and Positioning Target
Differentiation: large companies QUALITY + SPECIALI ZATION and FLEXIBILITY of our size
� Diversification
� Major consumer markets
� High growth markets
� R&D&I
� Special products: greatest growth and profitability
� Diversified portfolio of niche segments
� Differentiation in delivery lead times and order sizes: flexibility
� Efficient production processes
� Cost control
� Low leverage
Global Presence
Specialization in High Value-Added
Products Service Quality and Flexibility
Competitiveness and Financial
Strength
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Strategic Plan 2011-2016: Objectives & Achievements
1
2011 2012 2016
Focus on our Core Business:Seamless Steel Tubes
2012: Only 1 non core business
78%
61,7%
3,5%
90%
70%
10%
Energy Sector (% of sales, €)
Specialization (% of sales, €)
New markets (% of sales, €)
Investment Plan (% executed)
83%
63%
5%
2
3
4
5 2012: 25%, 2013: 50%
Increase margins vs volume
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€150M� 2012: 35 Mll Eur
Investment Plan 2012-2016
Goals:� To increase the volume of special products
manufactured
� To increase the range of special products
� To enter new markets through new products
� To consolidate leadership in high value-added niches
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Premium Products for the Energy Sector
� Larger and more efficient power generation facilities, with work cycles at higher pressure and temperature…
� Special steels with resistance to high pressures, temperatures and aggressive environments
� Larger diameters, thicknesses and lengths that maximise performance with lower assembly costs
Oil & Gas
PowerGeneration
TR R&D&I: Premium Products
� “Non-conventional” E&P: Directional Wells, Shale Gas, Off-shore, Arctic Grades,…
� High alloy / specific composition steels: more resistant to corrosion, pressure and temperature
� Special finishing processes: threads, coatings, upsetting
� New diameter / thickness combinations
Special pipes with more complex specifications
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Strengthen Presence in Current and New Markets
USA Europe
China/KoreaIndia
Middle East
Mexico
South America
Sub-Saharan
Africa
North Africa
Eastern Europe
Current Markets
New Markets
Financial Information
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Seamless Steel Tubes Sales*, €M Seamless Steel Tubes EBITDA*, €M
Seamless Steel Tubes EBIT*, €M Seamless Steel Tubes Net Profit*, €M
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2012: Seamless Steel Tubes Business
Sales, €M EBITDA, €M
� Reduction in sales volumes: demand affected in main markets, Europe and US (2nd
semester)
� EBITDA margin increase: better mix and competitiveness improvements
� Net Profit decrease : higher amortizations and financial expenses
Net Profit, €M
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Distribution Business: Reorganisation & Plan for Future
Reorganisation: � Terminate tertiary business, including currently associated structure and assets
Plan for the future:
� Focus exclusively on Industrial business� Products and services complementary to the main
seamless steel tubes activity� Become more International, taking advantage of the
Group sales network
� 2010: Distribution business focused on the domestic market and with a strong presence in the tertiary sector - not a core factor in Grupo Tubos Reunidos strategy: Decision to disinvest
� 2012: The situation of markets has made it difficult to complete the disinvestment process. Determination of a new strategic definition, aligned with the core business of the Group, which involves its reorganisation
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Consolidated Results 2012: Key Figures
� Impact of the new strategic definition of the distr ibution business on the consolidated result, which involves the implementation of a reorganization plan whose single and non-recurring cost was recorded in 2012.
� Without the effect of the distribution business, the Group achieved:
� EBITDA margin improvement: 14.6% in 2012 vs. 13.2% in 2011
� Same level of net profit than in year 2011
Sales, € M Resultado Neto
Seamless Steel Tubes Automotive & Other
Distribution
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Consolidated Cash Flow 2012: Key Figures
� Positive cash generation affected by extraordinary credit tax payment of 20 Mll Eur in 2012
� Long-term financing structure, 89% of net financial debt in 2012, and 95% on 1T 2013
� Undrown credit facilities available for 64 Million Euros
11%
89%
Net DebtFinancial Structure
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Consolidated Income Statement 2012 (€K)
Consolidated Profit & Loss Account 1Q 2013 1Q 2012 201 2 2011
Net Sales 95.196 128.014 464.727 499.581
EBITDA 10.598 20.962 49.574 62.214
% / net sales 11,1% 16,4% 10,7% 12,5%
Amortization 6.985 6.601 26.606 21.210
EBIT 3.613 14.361 22.968 41.004
Net Financial Result -2.693 -3.007 -10.443 -9.403
Pre tax Profit 920 11.355 12.525 31.601
Taxes 2 -3.191 -1.477 -6.426
Net Profit before minorities 922 8.164 11.048 25.175
Discounted Operations 0 0 0 -341
Minority Interests 242 -44 -475 -399
Net Profit 1.164 8.120 10.573 24.435
Financial figures in the income statements for year 2011 and 2012 have been reformulated by reclassifying the distribution activity from "discontinued operations" and "held for sale" to "continuing operations", to allow them to be correctly compared with the financial data for year 2012.
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Consolidated Balance Sheet 2012 (€K)
Consolidated Balance Sheet 1Q 2013 2012 2011
Non Current Assets 400.986 404.268 382.549
Inventory and Accounts Receivables 214.844 220.148 235.650
Cash and Cash equivalents 64.255 51.295 64.169
Current Assets 279.099 271.443 299.819
Assets held for sale 10.922 11.240 11.499
Total Assets 691.007 686.951 693.867
Equity 244.543 243.588 238.326
Deferred Income 9.054 9.369 5.965
LT interest bearing debt 174.850 160.185 159.919
Other liabilities 69.684 66.489 61.526
Non current liabilities 244.534 226.674 221.445
ST interest bearing debt 73.255 71.019 66.162
Accounts payable and others 119.621 136.301 156.420
Current Liabilities 192.876 207.320 222.582
Liabilities from assets held for sale 0 0 5.549
Total liabilities 691.007 686.951 693.867
Net Financial Debt, Million Eur 184 180 164
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