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Tubacex restructures its manufacturing plants
Tubacex Tubos Inoxidables (T.T.I)
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Company: Tubacex Tubos Inoxidables (T.T.I), Spain
Attn: Fernando Gomez Pujana

*Group discontinues production at Altx, one of its US factories

*The Groups consolidated profit forecasts for this year remain unchanged

(Llodio, 27 November 2002). In view of the way in which the stainless steel tubing market is evolving and bearing in mind the fall in manufacturing activity in the United States, TUBACEX has decided to restructure the production in its plants approving the indefinite suspension of the operations at the plant of its subsidiary, Altx Inc, in Albany, the capital of New York State and moving the production to its centers in Greenville (Pennsylvania), Llodio (Spain) and Ternitz (Austria), according to a statement issued by the company to the Securities and Exchange Commission (CNMV) and following todays Board of Directors meeting.

This decision has been taken because, after three years from its acquisition, Altx has not reached its initial industrial and business targets. The decision is in line with the strategic principle of structural competitiveness and profitability in all Group business units and is, at the same time, a continuation of the flexibility policies that ensure the Groups production capacities and cost structures can be adapted at all times to the market situation.

The decision has been made at a time when the North American market is experiencing difficulties and domestic demand is suffering a slowdown.

As a result of the Boards decision, around 6% of the Groups workforce will be reduced. The restructuring process of this North American subsidiary is scheduled for completion by the end of December 2002.

The decision does not affect the Groups other plant in the US, which in spite of the adverse market situation, will post good results for the year, continuing with the companys positive development since it was taken over in 1995.

Ongoing commercial operations and the market supplied by Altx will now be handled by the Groups plants in America and Europe and, as a result, todays decision will not impact on the companys market share, currently standing at 22%.

TUBACEX is now the leading exporter of seamless stainless steel tubing to the North American market.



Consolidated net profit forecast remains unchanged for 2002

TUBACEX is maintaining its original consolidated results forecast for 2002. Net profits will be up on 2001, in line with quarterly results for the year. Up to September of this year TUBACEX had made a net profit of 11.64 million euro, 5.3% up on the previous year.

In continuing to pursue conservative accounting policies, the Group will apply the resolution approved by the Institute of Accounting and Auditing on 15 March 2002 and will set aside tax profits in recognition that deferred taxes have to be accounted for at the end of year 2002 in order to cover its investments in Altx, in accordance with International Accounting Standards (IAS) accounting principles. These profits come from the carry forward of unused tax losses and unused tax credits, the future recovery of which is completely assured.

TUBACEX Board of Directors believes that the decision taken will help guarantee and optimise the Groups future profitability levels and will further strengthen the company pledge to continue implementing consistent and sustainable dividend policies for its shareholders.


     Tel: 00-34-94-6719300   Fax: 00-34-94-6725062
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