IPSCO Inc. announced record net income in 2005 of $585.8 million, compared to $454.9 million in 2004. The increased earnings are primarily attributable to higher average selling prices, increased margins across most product lines, and a stronger product mix due to record sales of energy tubular products.

IPSCO's sales increased 20% in 2005 to $3.03 billion compared to $2.53 billion in 2004. Record energy tubular shipments and strong large diameter pipe shipments totaled 903,000 tons, an increase of 5% over the prior year, and were offset by a 4% decline in steel mill products and an 18% decline in industrial products shipments. About 32%, or 1.1 million tons, of IPSCO's total shipments in 2005 were tubular products.

The company believes that end user demand for steel mill products will remain relatively stable in 2006. They expect high oil and gas prices to continue to drive high rig counts and demand for OCTG products. The current 2006 forecasts suggest that drilling activity will increase 6-8% over 2005, which was itself a very strong year. Large diameter pipe bookings have been very strong and IPSCO expects spiral pipe facilities to be running at full capacity throughout 2006.

IPSCO plans to invest approximately $150 million of capital in tubular and steel making facilities in 2006. The company anticipates that higher costs of steel making inputs in the first quarter will result in some margin compression.