By Pierre Bertrand
Vallourec's shares traded higher after the French steel tube maker said it intends to pay its first dividend in just over 10 years.
Shares rose 7.1% to 16.34 euros in early afternoon European trading, bringing its share price up nearly 17% from the start of the year.
Vallourec "has proven its ability to control its costs, manage its working capital and ultimately to generate significant cash flow," Chief Executive Philippe Guillemot said. "This marks the group's eighth consecutive quarter of deleveraging which ended with the exit from the safeguard plan implemented in 2021."
The company's debt fell to 240 million euros ($252.7 million) from 741 million euros a year earlier, it said Friday.
Vallourec said it would propose a dividend when releasing full-year results in February, adding that 80% to 100% of its total cash generation in the third quarter and beyond would be returned to shareholders.
"While there has been no clear consensus on shareholder return expectations, lack of a definitive start date likely disappoints," Jefferies analysts Jamie Franklin and Mark Wilson said in a research note.
The company also confirmed its 2024 outlook. Third-quarter net profit fell to 73 million euros from 76 million euros a year ago, and revenue declined 22% to 894 million euros.
Write to Pierre Bertrand at pierre.bertrand@wsj.com
(END) Dow Jones Newswires
November 15, 2024 07:30 ET (12:30 GMT)
Copyright (c) 2024 Dow Jones & Company, Inc.
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