TPT September 2007

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September/October 2007
Industry News
Interpipe, Ukraine, is on a fastrack to
financial, technical and trading growth,
according to company figures and
independent verification from international
financial agencies Fitch and Standard &
Poor.
Already a leading producer of seamless
pipe and wheels for the domestic and
eastern European market, the company
has increased its global sales by over 10
per cent annually for the last five years. In
this time, the company has also increased
the countries it serves from 46 to 76. This
growth has elevated the company into
the league of fastest growing global pipe
manufacturers.
With an annual production of 1.4 million
tons and gross revenue of around US$1.6
billion, Interpipe’s share of the world
seamless pipe market already exceeds 4
per cent, with further expansion planned in
the coming years.
In 2006, the company achieved a sales
revenue of US$1.44 billion and gross profit
of over US$503 million. This equated to a
sales growth of 11.8 per cent for seamless
pipe and 20.3 per cent for welded pipe.
This growth has been accelerated by the
process of restructuring all Interpipe entities
under one holding company. In addition to
a rebranding process, several large-scale
projects were initiated in 2006, including
the construction of an electric steel making
facility in Dnepropetrovsk.
A reflection of this growth and expansion,
the company has been awarded a positive
rating by international financial agencies
Fitch and Standard & Poor. Fitch rated
Interpipe as ‘B+’ (long-term) and ‘B’ (short-
term), with an outlook rating of ‘stable’.
Ratings agency Standard & Poors gave
Interpipe a long-term credit rating of ‘B+’
and a rating of ‘uaA’ (by national scale).
These ratings reflect Interpipe’s good
position among its international pipe
peers, based on its low indebtedness
and relatively high profitability, driven
by favourable industry prospects and
a low-cost production base. Its 2006
earnings (EBITDA) margin was 25.5 per
cent compared with an international pipe
producers’ average of 22.6 per cent.
Standard & Poor’s analysts expect Interpipe
to benefit from a good market position, with
strong demand for seamless and welded
pipes in the medium term. Fitch pinpointed
Interpipe’s diversified product portfolio (ie
pipes and wheels) as highly beneficial,
together with its high export revenue (79
per cent for pipe).
To further build its export portfolio, Interpipe
has just gained pre-qualification from a
number of leading oil producers. Interpipe
Niko Tube has been approved for inclusion
in the Kuwait Oil Company’s approved list
of manufacturers (API 5CT pipe), while
Interpipe Niko and Interpipe NTRP have both
gained pre-qualification from the UAE's Abu
Dhabi National Oil Company (API 5L pipe).
Interpipe’s short-to-medium plan for
2007-2009 involves investment of almost
US$730 million. This investment includes
new product development, improved
process control and non-destructive testing,
extension of special finishing floors, and de-
bottlenecking and flow rationalization.
Interpipe – Ukraine
Fax: +380 562 389482
Website:
Ukraine’s Interpipe: expanding plans for global growth
fi The company’s geographical distribution has increased from 46 to 76 countries in 4 years
› (Above) Interpipe’s success in figures; and (top) a major part of Interpipe’s strategic investment is the turnkey
installation of a 1.3 million ton electric arc meltshop in Dnepropetrovsk