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Maverick Tube Reports
Record 1st Quarter Results

April 21, 2004 — Maverick Tube Corp. announced net income of $28.7 million on net sales of $311.3 million for the quarter ended March 31, 2004.

Net income, $28.7 million ($0.68 per share) compares to net income in the same quarter last year of $242,000 ($0.01 per share). Net sales, $311.3 million, compare to net sales of $219.4 million for first quarter of 2003.

The company adopted Financial Accounting Standards Board (FASB) Interpretation No. 46, "Consolidation of Variable Interest Entities" and recorded a $1.6 million (net of $1.0 million in taxes) non-cash cumulative charge to recognize the prior losses of Pennsylvania Cold Drawn, LLC (PCD), which reduced net income by $0.04 per diluted share. PCD purchased the assets of the Drawn over Mandrel (DOM) Tubular Business pursuant to an asset purchase agreement dated March 31, 2002. Excluding the cumulative effect adjustment, the company would have reported net income of $30.3 million ($0.72 per diluted share) for the first quarter of 2004, compared to net income of $242,000 ($0.01 per diluted share) for the comparable period of last year.

Total tons of U.S. energy related products shipped during the first quarter increased to 163,846 tons, up 32%, compared to the first quarter of 2003. This increase was primarily due to a 24% increase in drilling rates in the U.S. during the quarter compared to the first quarter of 2003, with a 29% increase in gas-related drilling and a 4% increase in oil-related drilling. Energy shipments in Canada decreased 6%, down to 96,598 tons, during the first quarter over last year's rate, with drilling levels increasing 7% from the first quarter of last year. First quarter shipments of industrial products increased to 118,847 tons, or 19%, compared to the first quarter of 2003, primarily attributable to improved industry conditions.

Comments—Gregg Eisenberg, President and CEO said, "The rig count moved ahead 24% in the U.S. and 7% in Canada compared to the comparable quarter of last year. However, imports into the U.S. were up 72% from a year ago and 6% from last quarter. Inventory held by distributors and end users increased approximately 57,000 tons as compared to a 38,000-ton decrease in the first quarter of last year. As a result, domestic OCTG shipments in the U.S. were up 18% and 22% from the first quarter of last year and from last quarter, respectively. In comparison, Maverick's domestic shipments of OCTG products in the U.S. increased by 37% from the year-ago quarter and by 21% from last quarter. In Canada, domestic shipments of OCTG products increased 28% from last year's quarter and 7% from the last quarter. In comparison, Maverick's shipments of OCTG products in Canada decreased by 2% from the year-ago quarter and 3% from last quarter."

Eisenberg went on to say, "I was pleased with our results during the quarter, a record profit quarter for Maverick. We were faced with sharply higher replacement costs from our steel suppliers, and have had good success in passing these increases onto our customers. The quarter benefited from the lower-priced inventory we had available, which coupled with higher selling prices, yielded higher-than-normal margins. All segments of Maverick's business performed well during the quarter. We remain optimistic that these positive financial results will continue in the coming quarters."

Maverick Tube Corp. is a St. Louis, Missouri, based manufacturer of tubular products used in the energy industry for drilling, production, well servicing and line pipe applications, as well as industrial tubing products (HSS, electrical conduit and standard pipe) used in various applications.

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