Summary of Technip’s Second Quarter 2015 Results
Performance in line with July 6th announcement with strong revenue growth. Restructuring plan on track: 2Q one-off charge of €570 million
- · Order intake of €1.5 billion; backlog at €18.8 billion
- · 18% growth in adjusted revenue to €3.1 billion
- · Underlying operating income from recurring activities2 up 17% to €282 million, with €250 million in Subsea and €53 million in Onshore/Offshore
- · 2Q one-off charge of €570 million in line with July 6th announcement
· Adjusted Subsea revenue between €5.2 and €5.5 billion, adjusted operating income from recurring activities5 at around €840 million
· Adjusted Onshore/Offshore revenue around €6 billion, adjusted underlying operating income from recurring activities2 between €210 and €230 million
On July 28, 2015, Technip’s Board of Directors approved the second quarter and first half 2015 adjusted consolidated financial statements.
Note: The second quarter and first half 2015 results presented in this press release were prepared on the adjusted basis described in Technip’s fourth quarter and full year 2014 results press release. These results reflect the financial reporting framework used for management purposes.
Thierry Pilenko, Chairman and CEO, commented:
“Second quarter results were in line with the expectations we set out in our July 6th announcement. During the quarter, we continued to pursue our key strategy initiatives, to position ourselves on significant new projects and we launched a major restructuring plan across the Group to address the challenging market outlook we anticipate.
Subsea continued its outperformance: revenue grew 26%, and adjusted operating income from recurring activities of €250 million demonstrated a robust operating margin of 16.1%. During the quarter, good progress was made on projects across the world, as reflected in a strong vessel utilization rate of 89%.
After announcing our alliance with FMC Technologies in March, we formally launched the Forsys Subsea joint venture together, on June 1st as planned.
Onshore/Offshore grew revenues slightly faster than expected at 12%. Adjusted operating income from recurring activities is impacted by the one-off charge announced on July 6th. Stripping this out,underlying operating profits were €53 million, in line with expectations.
We have progressed well on some of our key projects, such as Burgas in Bulgaria, Ethylene XXI in Mexico, RAPID in Malaysia and Prelude in Korea.
Technip booked €1.5 billion of new orders, similar to the first quarter 2015 level, diversified and balanced between Subsea and Onshore/Offshore. This order intake reflects key elements of our strategy: a strong contribution from reimbursable and services contracts; success in areas such as Brazil pre-salt where we have technology leadership; positioning in early phase work for future projects such as the Browse FLNG in Australia and the Alexandria refinery in Egypt.
In our July 6th announcement, we set out in detail our views on the market outlook and these have not changed: the oil and gas industry is likely to be adversely impacted for longer than anticipated by the downturn. Our restructuring plan targets savings in Technip’s cost base of €830 million,
focusing the business on its core strengths.
By acting early and decisively, Technip’s teams are mobilized to put the Group on the front foot in a challenging environment.
Looking forward, we maintain our strategic direction and will continue to invest in, and expand,our capabilities. By having an earlier and broader view of projects, we are able to apply our technologies, the lessons learned from other projects and intelligent standardization to optimize project returns. Clients across the spectrum are responding positively to these initiatives, giving us confidence that our strategy will position Technip to deliver the lower project costs and value creation our industry needs.”
Follow us: @OilAndGasPress on Twitter | OilAndGasPress on Facebook
Contact e-mail: firstname.lastname@example.org