Soft market causes steep decline in earnings for Vallourec

YOUNGSTOWN

French steel-pipe maker Vallourec said Wednesday its first-quarter sales saw a drop of 17.2 percent from the first quarter of 2014, as the sharp decline in oil prices continues to impact companies that serve the oil and gas industry.

The company said it’s on track with implementing its cost-savings plan, which would cut 2,000 jobs worldwide with three-quarters of them in Europe.

The parent company of Vallourec Star, 2669 Martin Luther King Jr. Blvd., reported first-quarter sales at $1.17 million, compared with $1.4 million in the first quarter of 2014.

“Vallourec is currently facing very difficult market conditions,” said Philippe Crouzet, chairman of the company’s management board, in a statement. “Q1 2015 was severely affected by a drop in high-margin oil and gas sales in the EAMEA region [Europe, the Middle East and Africa]. ... Following the decline in demand, price pressure in the market has intensified for new orders, particularly in North America and for less-differentiated products in the EAMEA region.”

The company reported a loss of $84.41 million for the 2015 first quarter compared with a gain of $62.2 million in the 2014 first quarter.

Read more about the situation in Thursday's Vindicator or on Vindy.com.