The Vallourec group specializing in the manufacture of seamless tubes will cut 1,050 jobs around the world to strengthen its competitiveness.

France will thus see 350 jobs in this industrial sector disappear.

This decision follows the group's loss of activity, particularly in the oil and gas market.

The French manufacturer of seamless tubes Vallourec announced Wednesday the elimination of a total of around 1,050 jobs.

Three countries are concerned: France will suffer 350 job cuts, Germany 200 and Brazil 500. The group's objective is to "strengthen competitiveness" in a context of declining activity.

The group's turnover fell by a third in the third quarter, to 716 million euros, while the net loss widened slightly to 69 million euros (against 60 million a year earlier) , the company said in a statement.

Deliveries halved

Over the past quarter, Vallourec mainly suffered from the very sharp drop in demand on the Oil and Gas market, linked to the pandemic.

This drop, particularly notable in North America, was partly offset by good activity in Brazil.

But in total, deliveries were almost halved to 319,000 tonnes in the third quarter.

In this situation, the group is planning new structural restructuring measures, including for France the closure of the thermal treatment facilities in Déville-lès-Rouen, which represents around 350 jobs.

In Germany, Vallourec is also continuing its workforce reductions with 200 fewer jobs in 2021-2022 and is also counting on reductions in working hours.

In Brazil, the group will reduce support functions by 500 positions.

"No significant change" in activity expected in 2021

Vallourec was, however, able to generate positive free cash flow of 35 million euros, and improved its gross operating profit margin (to 9.9%, up 2 percentage points) thanks to 'cost savings.

The chairman of the management board Edouard Guinotte emphasized the group's "resilience" during a conference call.

The quarterly results are in line with "our expectations", he said.

But in a context which "remains very uncertain", Edouard Guinotte is not expecting "any significant change in our activity in the coming quarters", despite "some small tremors of recovery in the United States".

However, the group confirmed its outlook for 2020, including positive free cash flow in the second half, and gross savings of 130 million euros over the year.