Aug 6, 2026 earnings call — Hormuz Strait disruption and interim dividend decision
Board approved an interim dividend of $0.59 per share or $1.18 per ADS, approximately $600 million, to be paid the 25th of November.
Revenue $3.0B (est $2.9B) · EPS $0.95 (est $0.79)
Key quotes
"Our second quarter results clearly reflect the impact of the Middle East conflict and disruption in the Strait of Hormuz."
"In the United States, we are adding work shifts at our industrial facilities. Our Bay City mill is producing at record levels, and we continue to invest to improve the production capabilities of our Koppel steel shop and our Ambridge seamless pipe mill."
"As you mentioned, the Board has decided to increase the interim dividend to $600 million, doubling, as you mentioned, given the strong balance sheet and sustained cash generation of the company."
Analyst Q&A 5
Dividend change and Middle East impact
Q (Arun Jayaram): Analyst asked why the Board doubled the interim dividend and whether that level is sustainable long term. He also asked what assumptions management used for H2 2026 about the Strait of Hormuz disruption and how the underlying business looks excluding that noise.
A: The Board increased the interim dividend to $600 million because of a strong balance sheet and sustained cash generation, and it favors dividends to preserve share liquidity. The Board will decide future sustainability and it is subject to approval at the shareholder annual meeting; based on past practice this could continue. For the Strait of Hormuz, management removed $130 million of backlog from the base case; if navigability is restored it would be an upside and it would take 70 to 90 days to ship and invoice that material, with H2 revenues and EBITDA expected in line with H1 and a Q4 uptick anticipated.
"As you mentioned, the Board has decided to increase the interim dividend to $600 million, doubling, as you mentioned, given the strong balance sheet and sustained cash generation of the company." — Gabriel Podskubka (CEO)
Backlog impact on Q4 and dividend timing
Q (Marc Bianchi): Analyst asked how the compromised northern Gulf backlog would translate to Q4 EBITDA if the Strait were passable. He also asked if the company intends the usual 1/3 interim and 2/3 final dividend split.
A: Management said that without the northern Gulf disruption, the fourth quarter projection would be pretty much in line with the first quarter. If the Strait reopens in the short term, they could ship and invoice an additional $130 million within the fourth quarter but would need about 90 days to do so; that material has a premium margin. On capital returns, the 1/3 interim and 2/3 pattern is a Board decision and reflects past practice.
"without this northern part of the Gulf, our projection for the fourth quarter will be pretty much in line with the first quarter that you're indicating." — Gabriel Podskubka (CEO)
U.S. activity, pricing, and imports
Q (Sebastian Erskine): Analyst asked whether flat North America sales reflect U.S. pricing lag versus Pipe Logix and how price and volume should evolve in H2. He also asked when imports could become competitive again net of trade measures.
A: Management said U.S. activity rose about 10% since the start of the year (around 50 rigs) and they expect another 10 to 15 rigs, with shipments growing in line with activity. Prices normally follow Pipe Logix with a one quarter delay; Pipe Logix has risen around 9% and at least 5% more is expected by year end. On imports, 2026 imports have been contained by Section 232 and trade cases; if the new trade case has a positive determination imports should stay contained, and for imports to grow would require a more relevant price increase.
"Since the beginning of the conflict or the beginning of the year, we have seen that Pipe Logix has increased around 9%." — Guillermo Moreno (PRESIDENT)
Quarterly profitability trend
Q (Isacco Brambilla): Analyst asked if Q2 is the weakest quarter for EBITDA margin and whether margins will improve through H2.
A: Management said Q2 and Q3 will be similar in revenues and pretty much in line on EBITDA margin, so they expect the uptick only starting in Q4. They noted Q3 still carries lower volume and extra logistics costs similar to Q2, and when Q4 volume goes north of 1 million tons that will help fixed cost absorption and margins.
"I believe the second quarter and the third quarter will be similar in revenues and pretty much in line on EBITDA margin." — Gabriel Podskubka (CEO)
Fracking unit margins and Q3 mix
Q (Jamie Franklin): Analyst asked what a normalized margin looks like for the fracking business and for an update on the third unit by year end. He also asked for more detail on Q3 seasonality and product mix effects.
A: Management said Q2 and Q3 will have some under-utilization of their two fracking units in Argentina and the third unit will start operations in the fourth quarter, which will raise invoicing. They would not disclose normalized margins for competitive reasons but said the fracking business has an EBITDA ratio that is contributing and accretive to the Tenaris average. For Q3 mix, Europe has seasonal shutdowns reducing seamless volumes and they began shipments of the Sakarya welded SAW pipeline from Brazil to Turkey, which will continue for 3 or 4 quarters and has price and margin below the company average.
"I will not disclose it for competitive reasons, but I would say that it is a business that is with an EBITDA ratio contributing and accretive to the average of Tenaris." — Gabriel Podskubka (CEO)