Okay.

So we can start?

Okay. Well, thank you, Carmen, and sorry for the delay. We had some technical issue with the phone here in Luxembourg. Well, welcome to Canaris' 2026 third quarter conference call. Before we start, I would like to remind you that we will be discussing forward-looking information in the call, and that the actual results may vary from those expressed or implied during this call. With me on the call today are Gabriel Podskubka, our CEO, Carlos Gomez Alzaga, our chief financial officer, and Guillermo Moreno, president of our U.S. operations. Before passing over the call to Gabriel for his opening remarks, I would like to briefly comment our quarterly results. Our third quarter sales reached $3.1 billion, up 4% year-on-year and 5% sequentially. mainly reflecting higher demand in North America and an increase in shipment to customers in the Middle East. Average selling prices in our tubes operating segment, excluding services performed on third-party pipes, increased 4% compared to the corresponding quarter of last year and 2% sequential. Our EBDA for the quarter was up 16% sequentially to $750 million. with operating cash flow of $366 million which included an increasing of $270 million in working capital and capital expenditure of $98 million. Our free cash flow for the quarter was $268 million and our net cash position increased to $3.8 billion from the end of the quarter. Now I will ask Gabriel to say a few words before we open the call to questions.

Thank you, Giovanni. and I would like to extend a warm welcome to all of you participating in our call today. Our third quarter results were better than we had expected and reflected favorable product mix and an efficient industrial performance. We also managed to complete some delayed shipments in the Gulf that we had not anticipated and rescheduled the maintenance of some facilities until next year. Although the conflict and the disruption in the Middle East continues, Oil has begun to flow through the strait, and regional producers are looking to move forward with their projects. In Saudi Arabia, drilling activity increased during the quarter, resulting in more call-offs under our long-term agreement, and we secured a fast-track order for a link to the east-west pipeline. Aramco is also realizing significant efficiencies in its Jafura operations, which will allow to operate at a lower rig count without reducing pipe consumption. At the ADDIPEC conference in Abu Dhabi earlier this week, we presented a next generation premium connection designed to meet the performance of requirements of increasingly complex operating conditions in ultra deep water, high pressure, and extended rich wells. ADNOC has begun drilling wells with extended laterals of 13,000 meters and wants to increase those lengths. The Tenaris Hydro White connection is designed to make such objectives possible as it harnesses all our experience and technology in premium connection, design, and manufacturing. Customers continue to advance investments to meet the need for enhanced energy security and diversification of supply. Tenaris is particularly well positioned in this context as unconventional drilling activity increases in the Americas and offshore project sanctioning rises around the world. In the United States, higher drilling activity and higher production costs are resulting in higher OCDG prices as inventories are drawn down. We continue to increase production in our integrated domestic system as we work to satisfy customer demand. It is 20 years since we began to produce OCDG in the U.S. Since then, we have been the largest domestic production system and been an integral player in the transformation of the U.S. market. Our ambition does not stop here, and we will continue to build our position in this pivotal market. The development of Vaca Muerta Shell In Argentina continues a pace held by the government's RIGI investment program. A total of 43 billion in energy investments have already been authorized under the program, and a further 100 billion investments are pending approval. Production and activity are increasing, and infrastructure is being built. As our sales of OCDG and fracturing services increase, We have been awarded the supply for two new pipeline projects for the delivery in the first half of next year. As Venezuela seeks to revive its oil industry with a new hydrocarbon framework, Chevron and other major oil companies are committing to long-term agreements. We have been awarded a long-term contract to supply OCDG with rig direct services for Chevron's operations and to supply We have commented before on our backlog of offshore pipelines and our strong positioning in offshore projects more generally. During the third quarter, we have been delivering both seamless and welded pipes for the Zakaria project in Turkey, and we anticipate that our deliveries for offshore pipelines will increase in the fourth quarter and into 2027 as developments in the Mediterranean and Suriname move forward. Last week, we participated in the formal ceremony in Cyprus for the launch of the Kronos project. We received the award from ENI for the supply of OCDG and pipes and coating for this offshore pipeline. The project is being developed with a fast track approach, making use of existing regional infrastructure with first gas expected in the first half of 2028. In Europe, we receive unconditional clearance from the European Union Competition Authorities for the acquisition of Artrom. This transaction would mark a significant expansion of our position in the European market for industrial pipes, as well as our industrial presence in Romania. As we gear up for a further increase in sales in the coming quarters, our industrial system all over the world is working efficiently. This is an exciting time for Tenaris as we respond to the challenges of meeting the increasingly demanding requirements of our customers in a context of geopolitical volatility and supply chain disruption. Our constant focus on improving the service we provide to our customers, developing new products for increasingly complex operational conditions, and investing to achieve industrial excellence throughout our global industrial system position us uniquely to meet the challenges ahead. And now we are opening the room for questions.

Thank you. And if you have a reminder to ask the question, simply press star 1-1 to get in the queue and wait for your name to be announced. To withdraw your question, press star 1-1 again. One moment while we compile our Q&A roster. One moment for our first question, please. It comes from Mark Bianchi with TD Cowen. Please proceed.

Thank you very much. Impressive margins here in the third quarter, and it sounds like you're expecting further improvement in 4Q. I'd be curious if we could unpack that a little bit, maybe how much volume would you anticipate and any comments on how MIX should affect your average price and then just how to think about the margin that you're able to achieve in 4Q.

Good morning, Mark. Indeed, it was a very good quarter. I think congratulations to all the Tenerife team that were able to produce a good performance in the third quarter. Going into the fourth quarter, we expect a further step in revenues. I would say close to 10%. is what we see today. That would be mostly volume as we increase sales in the majority of our markets. We are having a mixed effect that is limiting the price increase in the fourth quarter. On one hand, we have a positive pricing dynamics on our seamless tubulars. But at the same time, in the fourth quarter in particular, we're having an increase of welded large pipelines that contribute to the overall revenues, but has an average price that is lower than the seamless. So at the end, partially offset this price increase that we see on the seamless side. So this is what we see for the top line. Then on margins, I believe that we're going to be around 25% with new conditions, given the increase in the top line and an improvement related to absorption of the new volumes.

Okay, that's very helpful. And I'm not going to ask you to guide to first quarter, but just as we think about the press release made the comment of The baseline for thinking about beyond and into 27, I believe. It sounds like by stating that's a baseline, there's nothing unusual in there that maybe goes away as we progress into 27. So maybe you could address that. But also, it sounds like you're continuing to have some overhang from the Middle East disruption. Maybe you could refresh us on how much that is. and then this maintenance that was deferred, it sounds like that's deferred into 27. How should we think about how that affects anything? Is that just going to show up normally in third quarter or would it be at another time?

Yeah, indeed it's a bit early to give a precise guideline on the first quarter of 27. There are a lot of moving parts, as you know, and we are certainly operating at an uncertain and volatile geopolitical environment. but still within this we believe that revenues in the first quarter of 27 will be higher. We still have on the pricing in the U.S. we still have a few points still that we are uncertain what will happen so this will be also part of the contribution and uncertainty in the first quarter of 27. But we see Thank you very much. A partial resumption of delivery of pipes to the upper part of the Gulf. Therefore, the previous two quarters were pretty much very contained. Some of our customers in the north part of the Gulf are starting to increase their activity. They found ways through this ship-to-ship methodology to bring some crude out of the straits. So this is increasing partially, already happening in the third quarter of 26, and we'll probably continue in the fourth quarter of 26 at a, I would say, contained level compared to what the backlog and what the traditional business has been, but starts to resume as well. So we'll start also from that point of view, having a nice contribution from that part of the Middle East. But I will leave it at this point. They are without more precision, even the uncertainty that we have around.

Okay, very good. Thank you so much. I'll turn it back.

Thank you. Our next question comes from Arun Yararam with JP Morgan Securities. Please, go ahead.

Yeah, good morning. I just wanted to follow up on Mark's question. If maybe you could elaborate on how the recovery in the Middle East could shape up And does your fourth quarter outlook, which assumes 10% revenue growth, called 25% margins, does that include a full recovery to the Middle East? I'm just trying to understand of how the recovery could kind of play out and what you're assuming as we think about the fourth quarter.

Yeah. Good morning, Aaron. In terms of middling, we are, I think, the fourth quarter and the first quarter of 27. will be pretty much similar to what we did in Q3. We are still not factoring in a full recovery in our shipments to Middle East. I was mentioning before to Mark on the partial resumption of oil-related demand in Iraq, Kuwait, and Qatar. Shipments are not recovering fully. We are still going through the alternative logistics, so there's still some difficulty to get material to this part of the Gulf and certainly the demand of OCTG associated with the LNG in Qatar is something that is not recovered and we're not shipping those pipes as of today. When we go to the rest of the Middle East, we see Saudi and the Emirates that continue to be very resilient in a very tough environment. Their drilling activity continues pretty much in line with what how they started the year even before the conflict. And we have through alternative routes being able with the local manufacturing and imported material to complement and service the rigs in the area. So I would say this has been resilient all along and continue to be. And we don't expect any major increase or decrease in the near future. So I would say a partial recovery of the Middle East and many more in the next two quarters. Then we will see how the situation evolves. There is always an upside if fully the recovery of the whole part of the gas opens up. But this is not something that we are factoring in our base scenarios.

Understood. Understood. That's very helpful. My follow-up is, you know, obviously we get a lot of, you know, transparency on the U.S. market between Pipelogix, and obviously we have a lot of activity measures like the rig count. I was wondering if you could give us a little bit more color on what you're seeing internationally as we start thinking about the 2027 outlook. Perhaps you could maybe elaborate on how you expect things to trend in LATAM, Venezuela, Argentina, as well as Mexico, which are historically been important markets for Tenaris. and offshore. That would be just helpful just to give us a little bit of color on how things could trend outside of North America.

Yeah. Okay. There are a lot of color in a lot of the moving parts. I will start with the Middle East we explained. Argentina, I think the environment is quite positive. I think on all the announcements that we commented on the RIGI, we see that translating gradually. Thank you very much. We will certainly participate in the growth of Argentina, and clearly this is not the end. There is a famous pipeline that is going to be put into operation in 2027, and this will unbottleneck pipeline capacity, which will allow for further increase of drilling even beyond these numbers that I'm giving. So I think we are quite positive on Argentina's engine of growth for 2027. Offshore, we see the strong and resilient. All discussions with our majors, with our customers that are leading the space in deep water are increasing activity, and they are quite advanced on sanctioning of new projects that might happen even before the end of the year or in 2027. So this is a space that has been strong and will continue to be strong. You mentioned Venezuela. I think Venezuela is another area that from a low starting point, we're closing the year with probably around $60 million of revenues in 2026. And this is something that we expect to continue growing into 2027. We are the leading player there. Today we have five leagues operating in the country. Our number for next year will probably be around 17, 18. So clearly there is, from a very low point, Thank you very much. Thank you very much. Thank you. Our next question comes from Isako Brambilla with Mediobanca. Please proceed.

Good afternoon, good morning to everybody. Thanks for taking my questions. I will start from a follow-up on North America, just asking how much of volumes acceleration we're showing should be attributed to North America, and if you can give us a sense of the contribution to the 12% quarter-on-quarter growth for the region from volumes and prices.

Very good, Isako. On North America, clearly a major component of that segment is the U.S., so we have Guillermo today to give a bit more color on the dynamic on volumes and pricing in the U.S., and then I will complement with the rest. Guillermo, please.

Yes. Good morning, Isako. In the case of the U.S., since the beginning of the conflict, we have seen An important activity increase and demand of OCTG of around 15%. And our sales have been growing in line with this. And we expect some additional growth in the current quarter. On top of that, and as you said, sorry, as Arun said, prices are very well reflected by biologics and the formulas of our contract. Piblogic increased in Q3 around 8-9% and in October an additional 6%. This is going to be reflected in our revenues of Q4 and Q1 of 2027. So we are seeing a solid demand. We think that moving forward it's going to be kind of flattish compared to where we are today. Maybe some upside potential in oil, but compensated by some short-term downside potential in gas due to the low price of the Henry Hub. And this is what we are seeing mainly for the U.S.

Thank you, Guillermo. Yes, just to complement North America, we also saw part of the 12% that you were referring to of the increase of the third world in North America was also related to to Canada and Mexico as well. In Canada, we commented before, we have a growing trend on volumes and also pricing. And also in Mexico, we're seeing a gradual recovery of drilling activity with Pemex and some of the other projects that are being led by independents as well. So we see also a gradual increase that we saw in Q3 contributing. So I would say U.S., Canada, and Mexico contributed to the growth in that quarter.

Okay, thanks a lot. Second question is on, more generally speaking, margin outlook for 2027 and the main building blocks. For sure, it is still early to give a precise guidance, but directionally, how should we think about the balance between price increase, benefits from operating scale, and rising pressure on the other end in terms of input and Logistics costs, looking forward to next year.

Yeah, this is an important point, difficult to be precise, but clearly with the things that we explained on the positive environment, given the importance of energy security, I think the whole situation in the Middle East is creating incentives in the different Thank you very much. Guillermo spoke about this, but I think the market is quite tight in the U.S., so we'll see how this plays out. But demand and cost pressures are moving pricing upwards. In the international space, pricing are quite balanced, I would say today, at healthy levels. On the one hand, we have a higher demand for offshore. On the other hand, we have sparked demand. of the Middle East that is subdued. So we will see how this plays out. But overall, we are having stability. And also in Europe, that for us is an important market. And we announced the target acquisition of Artrom. I think we have a positive contribution in Europe where we have an important presence in the mechanical and industrial segment. Artrom will contribute and practically double our market share in this space. So we see stable demand. We see a safeguard in Europe being implemented with the reduction of imports from China and other importers. So we see some pockets of further growth to increase gradually volumes over time and strengthen in pricing as well. We see that will certainly give us a further advantage on absorption of cost as we increase The scale of our operations.

Thanks a lot.

Thank you. One moment for our next question. It comes from the line of Joe Leitch with Morgan Stanley. Please proceed.

Hey, good morning and thanks for taking our questions. So just going back to the Middle East, you talked about the link to the east-west pipeline order. Can you just talk to the magnitude of that order? And then maybe more broadly, how are you thinking about the broader opportunity for pipeline expansions as countries focus on supply diversification? And can you talk about how Tenaris is positioned to potentially participate in supplying some of those future projects? Thank you.

Yes, indeed. Especially the Emirates and Saudi are working to develop alternative routes to the strait. They are working also to connect some of the new fields that they are bringing on stream. So both countries are working on the possibilities of increasing the infrastructure to make their delivery more resilient. This is something that we are participating, especially in Saudi. We have a GPC mill located in Jubail in Saudi Arabia that is specifically targeted towards these large infrastructure projects, both in oil and in gas. And we have in our portfolio already in the backlog projects related to the expansion of oil in some of the Suluco and Safania projects. We are also contributing to this connection, as you were mentioning before, on some of the main pipeline. We are concluding the delivery of the CCS pipeline as well. So even independently of the conflict, there is a need of connecting infrastructure for export and infrastructure for gas. We are working now in what will be the master gas phase four that is connecting the gas of Jafura with the different parts of Saudi Arabia as well. So I think we are well positioned to capitalize and we have been already capitalizing on our local position manufacturing of these pipelines in Saudi. In the U.S., we also have a coating facility in Raif al-Khaimah that is particularly contributing to the pipeline infrastructure there as well. So this is something that also supports Our business in Saudi Arabia and the Emirates. And we see an effort in this case of the Emirates of constructing a second pipeline to Fujairah to help evacuate oil out of the straits. So we see this as an active activity that gives pipeline opportunity for us but also makes very resilient the drilling where we participate in the OCDG as we are leading players both in the Emirates and Saudi. So I think this is constructive for Canaris going forward.

Great. That's helpful. Thank you. And then I just wanted to check in on shareholder returns. And just given that cash continued to build during the quarter, operations are strengthening, can you talk to how you're thinking about the potential for future dividends subject to board approval, of course, and then As part of that, any thoughts on potentially changing to a different dividend cadence such as quarterly relative to the current one-third, two-third structure? Thank you.

Thank you, Joe, for the question. Unfortunately, there again, I cannot give you a clear answer. I think this is something that will be a decision of the board. I think in February, it's not so far away. So I think we'll need to wait until then if we have a definition. But clearly, there is an improvement of... of Outlook, and as you said, the company is creating a good cash generation. So I think this is something that will be considered given the opportunities that we have in the market and always having in the top priorities of the company shareholder returns, but I cannot be more precise on that. So we wait until February for that. Sounds good. Thank you for the time. Thank you.

Thank you. Our next question comes from Julia Bokarnikova with Goldman Sachs. Please proceed.

Hi, thank you for taking my questions. I just wanted to follow up on U.S. pricing. How sustainable do you view this current level of prices? Do you think there are more tailwinds and more price increases we could potentially see or there are potentially imports that could come at this level or market is still very well protected? with all the recently produced in-producers. And maybe just how much of that price increase is being offset by higher raw material prices, or most of that is translated into your earnings and UBW time. Thank you.

Very good, Julia. Very relevant point. On the first point, I think it's quite sustainable, the increase that we're seeing of pricing in the U.S., but probably Guillermo can give you A bit more color on what are the drivers and the sustainability and what we expect for the following months in terms of pricing trends in the U.S.

Yes, since the beginning of this year, we have seen prices in the U.S. going up. It increased around 27% up to October. And as I said before, we think that there is room for some additional increases. Mainly, these increases have been driven by, number one, increase of activity of our clients and the demand for OCTG. Second, by the increase of costs, particularly raw materials, steel costs, and logistics costs. And regarding sustainability, well, we think that with this current level of demand, the level of inventories of OCTG on the ground that are Below standard levels, the continuing increase of some costs, particularly hot-rod coils here in the U.S. And new anti-dumping margins defined by the Department of Commerce for the main imports in the U.S. Thank you, Guillermo.

On the point of cost impact, and I think it's a relevant point, Julia, as well, because in the last few quarters, we have been impacted by Thank you, Gabriel.

Yes, as we mentioned in the last quarter, we are seeing the increase in the price of our raw materials hitting our costs, not through the different layers of inventors as they flow. And in this fourth quarter, we're going to be seeing an increase in costs as the price of scrap and the fertilizer has stabilized, but not the because of the fifth effect, we see an increase in this quarter, which is fairly similar to the last quarter. And in the case of scrap and Ferrari spray, they will level out in the first half of 27, and we will continue to see some residual effect of the energy in Europe and of HRC because of the way our contract with the orthoplasty structure, The current levels of the CRU price, we're going to be seeing that pooling around the second quarter of next year.

Okay, so this is the part that enters the latest HRC?

It's the slowest to impact the European.

And then we certainly, with the situation of gas in Europe, energy in Europe is a point of attention, so we're working also on pricing with our customers in Europe to offset that. and this latest increase.

Very helpful. Thank you. Could I just follow up on the exposure to pipe projects, pricing in your contracts in Latin America, like Mexico and Argentina? Should we also model this price increases in the pipe project having positive impact on your realized pricing in the region?

Yes, indeed some of our, especially our contracts in Mexico, Argentina, Colombia to some extent, I think part of the America, PipeLogix is always a reference. It's a market of a very dynamic and competitive market, so has been traditionally being the reference. The formulas are different in each of the contracts, each of the countries and customers, so it's not a directly... In many of the cases, there are factors, other cost factors, and there is certainly some delays, sometimes over one or two months, sometimes over a quarter. But somehow, I think pipe logic is a good indication of the pricing trends, not only in the U.S., but south of the U.S. and even in Canada is also a sort of a reference. So I think this is something that, not fully, but has certainly an impact and has been and will continue to be a Thank you.

Our next question comes from Matt Smith with Bank of America. Please proceed.

Hi there. Good morning. Good afternoon. Thanks for taking my questions. I had a couple. Forgive me for revisiting topics already being discussed to a certain extent. The first one was around distributions, and hopefully this is and many more. Thank you very much for the question. As I was commenting before, I don't have much

Much color to add on this specific point. It's something that is a decision of the board. So I think we are only four months away of Feb. I think I will invite you maybe to repeat the question back then and hopefully we'll have more significant information on this point. So far, I would say that this is still an open point.

Okay, understood. Fair enough. And then I wanted to come back to your comments around 4Q setting the baseline into 2027. You know, I think given what I can observe and the comments that have been made on the call, you know, it looks as though early 2027, let's say, particularly because that's what we have more visibility on, it's likely to see sequential improvements versus 4Q, at least as it relates to margins. I'm thinking about the lagged effect of U.S. pricing, particularly if we have further increases in U.S. pricing and positive mix effects from offshore shipments. So for me, I sort of struggle to see your EBITDA margins lower than 25 percent as I look into 27. Is that a fair assessment or would you add any color there? Thank you.

That's a very fair assessment. Matt, I follow every part of your logic and I think it's quite sound. So I would agree with all the points that you pointed out. So we're seeing exactly the same in these moving parts. But I think your conclusion is a very fair assumption of what we're seeing today. We'll see how, as you said, the moving parts move until then.

Okay, well I think we've covered a lot of ground so I'm happy to pass it on. Thank you guys.

Thank you.

Thank you. Our next question comes from Guillaume Delaby with Bernstein. Please proceed.

Yes. Good afternoon. Thank you for taking my questions. I have two, if I may. The first one is regarding international pricing. Should we factor in some kind of increase in international pricing starting maybe H2 pricing Thank you very much. A one-year cycle and could it be also, I would say, should we assume that the international slash offshore cycle could be a three to four-year cycle? So what is your approach, your perceptions of this next to come U.S. cycle and probably this longer term offshore cycle? Thank you.

Yeah, Guillermo, thank you for your questions. On the first point, I think international pricing, as I was saying, today is quite stable in average, given the balance of supply-demand. But I think this is, I would say, a temporary condition until the demand of the Middle East gets fully resumed. Because I believe that in our... International pricings are related to long-term agreements. In these cases, we have a formula where many of the raw materials that we talked about before are also factoring in those. So over time, and with probably a higher inertia of the contrast that we have in the U.S., for example, typically six to nine months inertia, we will see pricing over long-term agreements in the international space Thank you very much. and many more. I'm talking about the segments where we We are targeting and participating. On your second point on the crystal ball, I wish I had it, Jim, but what I see is that some of the dynamics that you were referring to and some of the segments that we're following, I'm quite confident to believe that we are talking about a multi-year cycle, and this is the case of the offshore and the deep water. I believe that the sanctioning of projects that we are seeing and will continue to see next year. These are decisions that these projects are not stopped or scaled down when there are variations of price of oil. These projects typically go ahead in any environment and scenario. And we believe that the projects that are today are even being sanctions and break-evens of $40 per barrel. I mean, I think the majors are not sanctioning these projects on the price level that we see today, but under much more stringent conditions. So I think this project and this trend of offshore is a space that will continue almost in any scenario for a multi-year. Then the other part of the spectrum, we have the unconventionals. We mentioned U.S., Canada, Argentina. There is probably a portion of that demand that could go in a few months Thank you very much. Thank you very much, Gabriela. Very comprehensive. Thank you very much. You're welcome. Thank you. One moment for our next question that comes from Jamie Franklin with Jefferies.

Please proceed.

Hi there, thanks for taking my questions. So just two. Firstly, obviously the strong margin improvement this quarter, you spoke to the favourable product mix and the efficient industrial performance. There's also a comment in the press release on postponement of maintenance. Thank you very much. Thank you very much. On your first point, indeed, we re-evaluated the need of a maintenance shutdown in a couple of our mills in North America. We proceeded with a

with the maintenance interventions in Europe as planned during the summer. But a couple of those were postponed into first half of 2027. We did a revaluation of the technical need of these facilities, if this could be done at the moment of plan or could be postponed around a few months, given the environment of high demand that we have. And we took the decision to postpone it. So this is something that will... will come into the first half of 2027, even the period of high demand. And the impact on cost, if you want, maybe Carlos can help me and see how this is factored into our financials.

Yes, yes, thank you, Gabriel. Well, the level that we expect for the fourth Q is very similar to the one that impacted our P&L in the third Q, and we are seeing an increase in... Thank you, Carlos.

On your second point related to the tariffs, given the increase of demand in the U.S., I think probably the number that you had of 120 million today is higher than that. We are probably flying at the level of 140, 150 million per quarter of tariffs. This is what is probably representing the reality of today, given the increased volume Thank you. Our next question is from Emmanuel Galazzi with Equitat. Please go ahead.

Good afternoon, everybody. Thank you for taking my question. I have two follow-ups. The first one is on the cost side and basically on the logistics. I was wondering if you are starting to see any sign of normalization on the logistic cost and how do you see the logistic cost evolving in 2027? and the second one is on the capital allocation. How should we think about CAPEX in 2027? Any specific needs to increase CAPEX for the coming year?

Thank you very much. I think it's a relevant point on the logistics. This is something, unfortunately, that we are not having a relief, but I will ask Carlos to give a bit more color on the impact on the logistics in Italy and in general. in our costs, and also he can follow up as well on our guidance of CapEx for the year. Thank you, Ariel.

Yes, in terms of the impact of our NGNA of the increased cost logistics, what we're seeing for the fourth Q is to have a very similar level on a per ton basis as we did in the Q3 of the variable component of our NGNA. and we are starting to see some relief in Q1 and then more so in Q2 of next year as things start to hopefully normalize over there. In terms of capital expenditure, this quarter was particularly low. We expect to increase the execution during the last quarter of the year and yes, for the For 2027, we expect to fly at a level which will be more in line with the fourth quarter of this year.

Thank you very much.

We are talking about around $600 million for 2027.

Thank you.

Thank you. One moment for our next question. It comes from Mark Bianchi with TD Cowen. Please proceed.

Thanks for taking another question. Just related to the capex for 27, it looks like based on your guidance here for volumes, you'll be over sort of a million tons a quarter, four million a year. What's the capability for Tenaris to satisfy that? And at what point do you think you need to invest more heavily for capacity expansion?

Thank you, Mark. I believe that first we're investing in CapEx, also we're investing in capital because we are also part of the usage of cash. It also will support the increasing volumes that we're seeing. As a matter of fact, I think in this quarter that we just closed, we had a working capital variation of $270 million. And I think we are even seeing a value that is similar or even slightly higher for the fourth quarter as we are building and the inventories to fulfill this increase on demand. Going back to CAPEX, I think we launched increasing capacity master plan program for Canada of $230 million. This was announced a few months ago, so I think strengthening our Canadian and North America footprint is important and we're going to launch that. We're doing the acquisition of Artron, which is also an additional investment increasing capacity, still making and rolling in Europe. We have also an ongoing capital expenditure program in the north of the U.S. to strengthen our rolling mill and still making there. So I think as we see a need and opportunities to strengthen our capacity, capabilities, the bottlenecking, this is something that is a high priority in our agenda. So we'll continue to support with our Thank you. And this will conclude our Q&A session. I will turn it back to Giovanni Sardana for closing comments.

Thank you, Carmen, and thank you all for joining us. Sorry again for the technical issue we had earlier today in joining this call. Thanks.

Thank you for participating in today's conference. You may now disconnect.