Current economic climate not like 2009 - Vallourec CEO

Reuters quoted Mr Philippe Crouzet CEO of steel tube maker Vallourec as saying that the current economic climate, while uncertain, was not comparable to 2009 when the company's production halved.

He said that but Vallourec could start cutting jobs in Europe, where costs are higher, if the economy slows down. More than half the drop two years ago was down to a correction in stock levels because some oil and gas customers had two years' worth of inventories. He added that "We are not in the same situation."

Vallourec manufactures seamless tubes for the oil, gas, petrochemical, automotive and electricity sectors, and demand for its products is heavily influenced by market conditions driving those industries. Total sales to the energy sector made up 78% of its global 2010 turnover of EUR 4.49 billion.

Its shares tumbled last week after the company trimmed its second half earnings forecast, saying the uncertain economic climate had made customers outside its core energy markets more cautious.

(Sourced from www.reuters.com)