Italian steel pipe maker Tenaris saw a surprise 2% increase in third-quarter net sales, reaching $2.98 billion, the first rise in eight quarters. Sales in North America remained stable, offsetting weaknesses in other regions. However, the company warned that margins would be impacted by increased tariff costs.

Despite a lack of drilling activity in Argentina and lower sales in Europe, Tenaris reported that tubular products and services sales were strong in the U.S. and Canada. The company expects sales in the final quarter to remain steady, but cautioned about the impact of rising tariff costs on costs and margins.

EU steel producers are operating at only 67% capacity due to rising imports and U.S. tariffs. The European Commission proposed cutting tariff-free steel import quotas by nearly half and imposing a 50% duty on excess shipments to boost operating capacity to 80%.

In response to trade measures, the U.S. imposed a 25% tariff on most steel and aluminium imports in March, which was increased to 50% for most countries in June. Tenaris’ earnings before interest, taxes, depreciation, and amortization rose by 9% to $753 million, boosted by a $34 million gain from returning U.S. anti-dumping deposits paid on imports from Argentina.

Read more at Yahoo Finance: Italy’s Tenaris posts surprise 2% rise in sales on stable US, Canada drilling