Vallourec S.A.: history, ownership, mission, how it works & makes money

A Brief History of Vallourec S.A.

Founded in 1853, Vallourec S.A. has evolved into a leading manufacturer of steel tubes primarily used in the energy and industrial sectors. With headquarters in Meudon, France, the company has established a global presence, operating in over 20 countries and employing more than 19,000 people as of 2022.

In the early 2000s, Vallourec expanded significantly through strategic acquisitions and partnerships. Notable among these was the acquisition of the Brazilian company, Vallourec & Sumitomo Tubos do Brasil (VSB), in 2005, which enabled Vallourec to serve the oil and gas exploration sectors more effectively. The joint venture expanded their operational capabilities and enhanced market access, significantly contributing to revenue growth.

Vallourec reported revenues of approximately €5.1 billion in 2021, a recovery from the €3.19 billion recorded in 2020, primarily buoyed by increased demand in the energy sector post-pandemic. The company’s net profit for 2021 was recorded at €179 million, reversing a loss of €676 million in the previous year.

During the 2014-2015 downturn in the oil and gas industry, Vallourec faced significant challenges, leading to numerous restructuring efforts. The company initiated a comprehensive cost-cutting program, targeting savings of around €300 million by the end of 2016.

In 2021, Vallourec announced a significant strategic initiative focused on decarbonization, setting a goal to reduce its greenhouse gas emissions by 30% by 2030. This initiative is part of a broader commitment to sustainability and aligns with the global energy transition towards cleaner sources.

As of mid-2023, Vallourec's stock performance has shown resilience, with shares trading around €12.50, reflecting a marked increase from €5.89 in early 2021, driven by positive market sentiment and recovery from previous downturns.

The company’s diverse product portfolio includes seamless and welded tubes, which cater to various applications such as oil and gas drilling, power generation, and automotive industries. Furthermore, Vallourec’s innovation and R&D expenditures were approximately €80 million in 2022, focusing on enhancing product quality and developing new technologies.

Vallourec continues to navigate the complexities of the global market, with ongoing investments in innovative technologies aimed at enhancing operational efficiency and environmental sustainability. The company’s strategic direction remains aligned with the evolving energy landscape, underscoring its commitment to meeting the needs of its customers amidst a transformative industry environment.

A Who Owns Vallourec S.A.

Vallourec S.A., a French multinational company, specializes in manufacturing seamless steel tubes and related services for the energy and industrial sectors. As of the end of 2023, the ownership structure of Vallourec is characterized by a diverse group of shareholders, including institutional investors, private equity firms, and individual investors.

Here is an overview of Vallourec’s major shareholders based on the latest publicly available data:

Wendel S.A. stands out as Vallourec's principal shareholder, with an ownership stake of approximately 30.0%. This investment firm has been instrumental in supporting Vallourec through various stages of its corporate strategy, particularly during periods of financial restructuring.

Institutional investors such as BlackRock and Amundi Asset Management hold significant portions of the company, collectively contributing to approximately 15.3% of the total shares. Their interests align with maintaining the company's operational efficiency and market competitiveness.

The free float accounts for approximately 55.8% of the shares, indicating a substantial ownership stake by individual and other institutional investors. This broad investor base can contribute to liquidity in Vallourec's stock trading on the Euronext Paris stock exchange.

In terms of financial performance, Vallourec reported revenues of approximately €5.2 billion in 2022, demonstrating a recovery from previous downturns. The EBITDA margin stood at 12.5%, showcasing improved operational efficiency. The company has continued to focus on strategic partnerships and contracts in the oil and gas industry, which are pivotal for its revenue streams.

Overall, Vallourec's ownership structure reflects a blend of committed institutional investors and a diverse public investor base, alongside solid financial performance that positions the company favorably within its industry.

Vallourec S.A. Mission Statement

Vallourec S.A. is a global leader in premium tubular solutions, primarily catering to the energy and industrial markets. The company's mission statement emphasizes its commitment to innovation, sustainability, and customer satisfaction. It aims to deliver high-quality, reliable products while maintaining a focus on reducing environmental impact and improving operational efficiency.

In fiscal year 2022, Vallourec reported a revenue of €4.1 billion, demonstrating a year-over-year increase of 14%. This growth reflects the company’s strategic focus on high-value markets and innovative solutions.

Vallourec’s mission is aligned with its strategic objectives, which include:

• Enhancing customer experience through tailored solutions
• Fostering innovation in product development
• Pursuing sustainability throughout its operations
• Strengthening its global presence in key markets

A key aspect of Vallourec's mission is its commitment to sustainability. The company aims to achieve a reduction in CO2 emissions by 30% by 2030 as part of its environmental strategy. Vallourec also focuses on circular economy principles, recycling and reusing materials in production processes.

The company's vision is to be recognized as a partner of choice for customers in the energy and industrial sectors. Vallourec invests heavily in R&D, allocating approximately 5% of its annual revenue to develop innovative technologies aimed at enhancing operational performance and sustainability.

Furthermore, Vallourec maintains a strong emphasis on safety and quality within its operations. The company implements rigorous quality control measures and safety standards across its production facilities. In 2022, Vallourec achieved a 97% satisfaction rate in its customer feedback surveys, highlighting its commitment to excellence.

Through its strategic initiatives and commitment to its mission, Vallourec strives to reinforce its position as a leader in the premium tubular sector while contributing positively to the environment and society as a whole.

How Vallourec S.A. Works

Vallourec S.A. is a global leader in premium tubular solutions primarily for the oil and gas industry, along with other sectors such as energy, construction, and automotive. The company specializes in manufacturing seamless steel tubes and offers a wide range of services, including connection solutions and technical support.

As of Q3 2023, Vallourec reported a revenue of **€1.746 billion**, marking a **42%** increase compared to the previous year. The company's EBITDA for the same period was **€307 million**, representing an EBITDA margin of **17.6%**.

• Core business segments include:
• Oil and Gas
• Energy
• Industry
• Construction
• Automotive

The company operates through a network of production plants and service centers around the world. In 2022, Vallourec expanded its capacity by investing **€120 million** in new technology and production capabilities.

Vallourec focuses heavily on R&D, allocating approximately **€45 million** annually to innovate its product range and improve manufacturing processes. The company has also enhanced its environmental strategies, aiming for a **30%** reduction in CO2 emissions by 2030.

In terms of market position, Vallourec's stock (Euronext Paris: VK) has shown a recovery trend, with a closing price of **€12.45** as of September 29, 2023, a notable increase of **65%** year-to-date. The market capitalization stands at approximately **€1.8 billion**.

Vallourec's global presence is significant, with operations in over **20 countries** and a workforce of approximately **18,000 employees**. The company continues to adapt its strategies to the evolving energy landscape, with a growing emphasis on renewable energy solutions.

As of the latest quarterly report, the order book reached **€2.2 billion**, reflecting solid demand in key markets including North America and the Middle East.

In summary, Vallourec S.A. strategically positions itself in the premium tubular market, focusing on high-growth sectors while committing to sustainability and technological advancement to drive long-term success.

How Vallourec S.A. Makes Money

Vallourec S.A., a global leader in premium tubular solutions, primarily generates revenue through the manufacture and supply of seamless and welded steel tubes. The company focuses on markets such as oil and gas, energy, and industrial applications.

In fiscal year 2022, Vallourec reported revenues of approximately €3.1 billion, with a notable increase of 25% compared to the previous year. This growth was driven by higher demand in the oil and gas sector, where prices were buoyed by recovering global energy markets.

The segments contributing to Vallourec's financial performance include:

• Oil and Gas: This segment accounted for roughly 66% of total revenue.
• Power Generation: It made up about 14% of the revenue mix.
• Industry and Other: The remaining 20% derives from industrial applications and other sectors.

In 2022, Vallourec's EBITDA margin improved to 16%, driven by operational efficiency and favorable pricing conditions. The adjustment in pricing strategy allowed the company to pass on rising raw material costs to its customers effectively.

Vallourec is also expanding its business through innovation. In 2023, they invested approximately €100 million in research and development to enhance product offerings and optimize manufacturing processes.

Another key avenue for Vallourec is its strategic partnerships and long-term contracts, particularly in the oil and gas sector. These contracts provide stable revenue streams and mitigate exposure to market volatility.

In terms of geographic revenue distribution, Vallourec generated approximately 40% of its sales from North America, while Europe accounted for 35%. The remaining 25% came from other regions, including Asia and the Middle East.

Vallourec also focuses on sustainability, aiming to reduce its carbon footprint in production. The company has committed to a 30% reduction in greenhouse gas emissions by 2030, aligning with global trends toward environmentally responsible manufacturing.

In summary, Vallourec’s revenue generation is multifaceted, heavily influenced by market demand in oil and gas, coupled with operational efficiencies and strategic positioning in global markets.