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Glossary 

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AMF: French Financial Market Authority

AMF is the French stock market authority. It governs and oversees the conduct and professional ethics of the markets and protects the interests of investors and shareholders.

Annual Report
The annual report is a corporate brochure designed to provide our shareholders, customers and interested parties with information relating to the activity of the Group over the past fiscal year. It contains summary financial information. The Reference Document provides all legal, economic and financial information for the Group for a given fiscal year. Both reports are published prior to the Annual Shareholders Meeting.
Annual Shareholders’ Meeting / Extraordinary Shareholders’ Meeting
The Supervisory Board calls an annual meeting of shareholders once a year for ordinary management actions: approval of financial statements, election of board members, etc. An extraordinary meeting of shareholders is called to approve decisions affecting the share capital of the company.
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Balance Sheet
A balance sheet is a snapshot of the company’s accounts at the end of fiscal year. It shows the resources of the company (assets) and its debts (liabilities).
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CAC 40

The benchmark French stock market index The index represents a capitalization-weighted measure of the 40 most significant values among the 100 highest market caps on the Paris Bourse (now NYSE Euronext Paris). Vallourec has been included in the CAC 40 index since December 2006.  
CAC = “Cotation Assistée en Continu”, or continuous automated trading.

CACEIS Corporate Trust

Custodian and transfer services for the management of Vallourec shares:

Contact:

Telephone:  + 33 (0)1 57 73 34 44

Fax:  +33 (0)1 49 08 05 08

Address:  CACEIS Corporate Trust

Investor Relations

92862 – Issy-Les-Moulineaux Cedex 09

Capital Employed
Financial resources used by a company to develop its business. It is the sum of shareholders’ equity, minority interests and net debt.
Capital Expenditure (CAPEX)
Investments in plant, machinery, equipment (fixed assets) to be used in the business activity. Capital expenses are capitalized on the balance sheet, and depreciated over the expected useful life of the assets.
Cash Flow Statement
The cash flow statement is a document containing information about the cash generated by a company’s operations. It is either reinvested or distributed to shareholders (dividend). Cash flow corresponds roughly to after-tax earnings plus depreciation and amortization, less minority interests. See also: Operating cash flow
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Deferred Settlement Service (SRD)
Service available for the most traded stocks through which settlement for orders or delivery of shares is deferred to the last trading day of the month. Vallourec shares are eligible for this service.
Dividend
The part of the company’s net income distributed to shareholders.
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Earnings per Share
Basic earnings per share are calculated by dividing the annual net income by the weighted average number of outstanding share during the fiscal year. 
Diluted earnings per share are calculated by dividing the annual net income by the weighted average number of outstanding shares plus the effect of any dilutive instruments.
EBITDA (Earnings Before Interests, Taxes, Depreciation and Amortization)
Also known as operating profit before depreciation, EBITDA is the operating revenue less total operating costs . EBITDA is used as a key financial indicator.
EBITDA as % of Sales
A key financial indicator which illustrates the profitability of the company.
Euronext Paris

Name of the firm which organizes, manages and develops the securities market, and acts as market regulator (financial transactions, monitoring of companies listed on the stock market) with the delegated authority of France’s Financial Market Authority.  

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Free Float
The part of a company’s capital in public ownership and tradable on the stock markets. The higher the free float, the greater the liquidity of the shares. 100% of Vallourec’s capital is floated.
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Gearing
The gearing ratio is calculated by dividing net debt by shareholders’ equity.
Goodwill
Goodwill is the difference between the purchase price (acquisition) of a company and the net value of the subsidiary after re-evaluation.
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IFRS (International Financial Reporting Standards)
International Financial Reporting Standards are international standards (formerly IAS – International Accounting Standards) established by the IASB (International Accounting Standards Board). European companies must adhere to these standards which have been set out in order to standardise financial reporting methods.
ISIN code (International Securities Identification Number)
Code composed of 12 characters used to identify financial products quoted on the stock exchanges (Vallourec ISIN code: FR00000120354).
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Liquidity
Ratio of the volume of shares traded over the total number of shares in circulation.
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Market Capitalization
A company’s market value equal, at any given time, to the quoted share price multiplied by the number of shares in circulation.
Minority Interests
Minority interests represent the share attributable to minority shareholders in the shareholders’ equity and net income of consolidated subsidiaries.
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Net Debt
Net debt is defined as financial debt less short term investments, cash and cash equivalents.
Net Income
The profit or loss made by the company. Net income is the residual part of the profit after the company has paid what it must to creditors and the State (i.e. tax).
Net Income, Group share
Net income, Group share is the residual part of the profit after the company has paid what it must to creditors, the State (i.e. tax), and minority interests. Net Income, Group share is the part of the profit which can be distributed to the shareholders in the form of dividends or put into the reserves in order to increase the capital of the company.
NYSE Euronext Paris
Name of the firm which organizes, manages and develops the securities market, and acts as market regulator (financial transactions, monitoring of companies listed on the stock market) with the delegated authority of France’s AMF
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Operating Cash Flow
Operating cash flow represents the cash flow generated by the company’s day-to-day operations. It differs from the EBITDA by the amount of change in working capital. It can be considered as a source of funding for our activity.
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Profit & Loss Account
The profit & loss account, or income statement, states all the operations achieved within the fiscal year. These operations can be recurrent or exceptional, positive or negative in terms of cash flow. Operations with a positive result represent revenue and operations with a negative result represent an expense. The difference between the revenues and expenses is the result of the fiscal year (profit or loss)
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Quorum

Minimum percentage of shares with voting rights required to be present or represented for an Annual

Shareholders’ Meeting to be validly constituted.

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Registered Document
The registered document contains all legal, economic and accounts information concerning a company for a given fiscal year.
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Sales
Consolidated sales of all the subsidiaries of the Group recorded over a period.
Sales Volume
Sales volume corresponds to the volume in metric tonnes of hot-rolled tubes produced by Vallourec’s rolling mills and delivered to customers.
Share
Tradable security representing a portion of the company’s capital. The owner of a share, the shareholder, is a part-owner of the company and enjoys certain rights.
Shareholders’ Equity
The part of the company’s capital belonging to its shareholders. It includes the value of issued shares, retained earnings and Net Income for the financial year.
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Voting Rights
Voting rights are rights attached to shares, and allow shareholders to vote on the resolutions presented at the Annual General Meeting.
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Working Capital
The working capital of a company is the value of its current assets (trade receivables and inventories) less current liabilities (trade payables) and provisions for risks and charges. 
A company’s working capital is the money it has available to meet current obligations (those due in less than a year).
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Yield
The yield of a share is calculated by the comparison between the last dividend paid by the company and the share price. It therefore represents the level of remuneration received by the shareholder.