Paris (AFP)

More than a thousand jobs eliminated, including 350 in France where a plant in Seine-Maritime will be closed: the industrial Vallourec, still heavily penalized by the pandemic and in debt, announced on Wednesday a new series of measures to strengthen its competitiveness.

Vallourec, a French specialist in seamless tubes and dependent on a hydrocarbon market which has contracted sharply since the start of the health crisis, had already announced in the first half of the year the elimination of 900 jobs in North America, i.e. a third staff in the area.

Now, it plans to cut 1,050 more jobs, out of nearly 19,000 employees worldwide.

For France, the restructuring plan provides for the elimination of 350 jobs, particularly on production units, including the closure of the Déville-les-Rouen (Seine-Maritime) plant.

"It's a real shock for our territory," said in a statement the deputy (LREM) of the department, Damien Adam, referring to "nearly 190 employees" thus concerned and saying he was determined to "do everything" so that the site "finds an activity with an industrial vocation taking up a maximum of jobs".

The elected officials of the Hauts-de-France region and of several municipalities where Vallourec is present also reacted to express their vigilance "on the jobs of the industrial sites of Aulnoye-Aymeries, Saint-Saulve, as well as of the support site of Valenciennes" .

In Germany, the group expects 200 fewer jobs and reductions in working time.

Finally, in Brazil, 500 positions will be eliminated in support functions.

These measures follow a third quarter which saw the group's turnover fall by a third to 716 million euros, while the net loss widened slightly to 69 million euros (compared to 60 million a year ago).

These results are "in line with our expectations", commented the chairman of the management board Édouard Guinotte, emphasizing Vallourec's "resilience".

The group thus announced the renewal for five years of its framework contract with Total, following the extension in July of the partnership with Petrobras.

But the very sharp drop in demand on the Oil and Gas market, particularly in North America, and the decline in activity in industrial sectors in Europe, were only partially offset by a good quarter in Brazil.

In total, deliveries were almost halved over one year to 319,000 tonnes.

- 636 million euros loss -

And the economic context remains "very uncertain", said Édouard Guinotte.

The boss of Vallourec does not expect "any significant change in our activity in the coming quarters", despite "some small tremors of recovery in the United States".

However, the group maintained its financial outlook for the 2020 financial year.

In the first nine months, sales fell by a quarter to 2.4 billion euros and the group recorded a net loss of 636 million (against 227 for the same period of 2019).

Financial director Olivier Mallet said the group was going to provision between 60 and 80 million euros in restructuring charges in the fourth quarter.

In this context of activity severely penalized by the health crisis, which slowed down economies and reduced demand for hydrocarbons, Vallourec began negotiations this fall with its creditors to restructure its debt, which amounted to 3.5 billion. euros at the end of September.

On Tuesday, the group said it was aiming for a debt reduction of just over 50% through a capital conversion.

"The negotiations with the creditors are just starting", said Mr. Guinotte, who wants to achieve "as soon as possible", and in any case before February 2021, date of the maturity of credit lines up to 1.7 billion euros.

© 2020 AFP