- Total Company inbound orders of $6.2
billion; book-to-bill of 2.1
- Net income of $20.9 million and
adjusted EBITDA of $295.8 million
- Updated 2019 financial guidance
reflects strong orders and execution in Onshore/Offshore and lower
North American activity in Surface Technologies
Regulatory News:
TechnipFMC plc (NYSE:FTI) (Paris: FTI) today reported first
quarter 2019 results.
Total Company revenue was $2,913 million. Net income was $20.9
million, or $0.05 per diluted share. These results included
after-tax charges and credits totaling $6.4 million of expense, or
$0.01 per diluted share; adjusted diluted earnings per share were
$0.06.
Adjusted EBITDA, which excludes pre-tax charges and credits, was
$295.8 million; adjusted EBITDA margin was 10.2 percent (Exhibit
7).
Other significant pre-tax items impacting the quarter, for which
we do not provide guidance, included the following:
- $11.6 million of foreign exchange
losses included in corporate expense, or $0.02 per diluted share on
an after-tax basis; and
- $84.7 million of increased liability
payable to joint venture partners included in interest expense, or
$0.19 per diluted share on an after-tax basis.
Summary Financial Statements – First Quarter 2019
Reconciliation of U.S. GAAP to non-GAAP financial measures are
below and in financial schedules.
Three Months Ended
(In millions, except per share
amounts)
March 31,
2019
March 31,
2018
Change Revenue $2,913.0 $3,125.2
(6.8%)
Net income $20.9 $95.1
(78.0%)
Diluted earnings per share $0.05 $0.20
(75.0%)
Adjusted EBITDA $295.8 $386.6 (23.5%)
Adjusted EBITDA margin 10.2% 12.4% (222
bps)
Adjusted net income $27.3 $131.5
(79.2%)
Adjusted diluted earnings per share $0.06
$0.28 (78.6%)
Inbound orders $6,184.5 $3,487.0
77.4%
Backlog $17,777.6 $14,012.0
26.9%
Doug Pferdehirt, CEO of TechnipFMC, stated, “Quarterly orders of
$6.2 billion were our highest since the fourth quarter of 2014.
This reflects the strength of our integrated subsea model, our
demonstrated capabilities in downstream and gas monetization, and
continued growth in international surface markets. With total
Company book-to-bill of 2.1 in the quarter, backlog grew 22 percent
sequentially to $17.8 billion.”
“In Onshore/Offshore, we continue to execute well and achieved
notable project milestones during the period. Orders of $3.1
billion were more than double our revenues in the quarter, driven
by major downstream and offshore projects. Additionally, we are
prioritizing five LNG projects that are most strategic to
TechnipFMC and offer the highest probability of successful
execution. ”
“In Surface Technologies, weaker-than-expected activity in North
America significantly impacted our quarterly results and has led to
a change in the market outlook. We no longer anticipate the
recovery in North America as originally forecasted. Outside of the
Americas, our expectations remain unchanged at high-single digit to
low-double digit activity growth.”
Pferdehirt continued, “Strong Subsea orders of $2.7 billion
resulted in a book-to-bill of 2.3, driven by an increased
contribution from integrated EPCI (iEPCI™). Our integrated FEED
(iFEED™) capabilities serve as a key differentiator and have been
instrumental in securing new iEPCI™ awards. The number of new
iFEED™ studies nearly doubled in 2018. Many of these are
proprietary, providing an exclusive opportunity set to
TechnipFMC.”
“In the first four months of 2019, we have secured seven new
integrated projects, representing an aggregate contract value of
$1.4 billion. This expansion of our integrated portfolio includes
projects from BP, Lundin, ENI and ConocoPhillips – all first-time
iEPCI™ adopters. Given this early success and our expanding
opportunity set, we are confident that iEPCI™ project awards will
exceed 25 percent of our Subsea order inbound in 2019.”
Pferdehirt concluded, “Our Company has returned to growth, and
we are well-positioned to benefit from the recovery underway in
many of our key end-markets. Our strong balance sheet ensures that
we have sufficient capital to grow the business, while supporting
our commitment to return excess capital to shareholders. When these
actions are combined with strong operational execution, we can
drive our capital returns higher over time. This focus on
shareholder capital has been a part of management compensation
since the formation of TechnipFMC, and it reflects how we will
continue to manage our balance sheet and our business going
forward.”
Operational and Financial Highlights – First Quarter
2019
Subsea
Financial Highlights
Reconciliation of U.S. GAAP to non-GAAP financial measures are
below and in financial schedules.
Three Months Ended
(In millions)
March 31,
2019
March 31,
2018
Change Revenue $1,185.3 $1,180.2
0.4%
Operating profit $49.9 $54.4
(8.3%)
Adjusted EBITDA $139.7 $172.0
(18.8%)
Adjusted EBITDA margin 11.8%
14.6% (279 bps)
Inbound orders $2,677.6 $1,227.8
118.1%
Backlog $7,477.3 $6,110.9 22.4%
Subsea reported first quarter revenue of $1,185.3 million,
largely unchanged from the prior year. Modest growth in services
offset the decline in project revenues reflected in the lower level
of vessel utilization.
Subsea reported operating profit of $49.9 million; adjusted
EBITDA was $139.7 million with a margin of 11.8 percent. Operating
profit declined versus the prior-year quarter primarily due to more
competitively priced backlog and lower vessel utilization, offset
in part by cost reduction activities. These same factors drove the
year-over-year decline in adjusted EBITDA.
Vessel utilization rate for the first quarter was 55 percent,
down from 62 percent in the fourth quarter and 60 percent in the
prior-year quarter.
First Quarter Subsea Highlights
- Total Egina (Nigeria)Delivered
final subsea tree for one of the largest subsea projects in West
Africa.
- Total Kaombo (Angola)Completed
hookup campaign for the South floating production, storage and
offloading unit.
- Skandi Olinda PLSV
(Brazil)Commenced eight-year charter contract with
Petrobras.
Subsea inbound orders for the quarter were $2,677.6 million,
resulting in a book-to-bill of 2.3. The following announced awards
were included in the period:
- BP Atlantis Phase 3 iEPCI™ Project
(Gulf of Mexico)Significant* iEPCI™ contract by BP for the
Atlantis Phase 3 project. Following final investment decisions from
all partners, TechnipFMC will manufacture, deliver and install
subsea equipment. The contract also includes provisional services
for tooling and personnel required to install the hardware.* A
“significant” award ranges between $75 million and $250
million.
- Lundin Solveig (Luno II) and
Rolvsnes iEPCI™ Projects (North Sea)Substantial* iEPCI™
contract from Lundin Norway for the Solveig (Luno II) and Rolvsnes
development. The contract covers the delivery and installation of
subsea equipment including umbilicals, rigid flowlines, flexible
jumpers and subsea production systems.* A “substantial” award
ranges between $250 million and $500 million.
- Petrobras Mero I Pre-Salt Project
(Brazil)Large* engineering, procurement, construction and
installation contract by Petrobras, on behalf of the Libra
Consortium, for the Mero 1 pre-salt field. The contract covers
engineering, procurement, construction of all rigid lines, as well
as the installation and pre-commissioning of all the infield riser
and flowline system. It also includes the installation of rigid
pipelines, flexible risers and flowlines, steel tube umbilicals and
other required subsea equipment.* A “large” award ranges between
$500 million and $1 billion.
- Equinor Johan Sverdrup Phase 2
Project (North Sea)Significant* contract from Equinor for the
Johan Sverdrup Phase 2 development. The contract covers the
delivery and installation of the subsea production system including
integrated template structures, manifolds, tie-in and controls
equipment.* A “significant” award ranges between $75 million and
$250 million.
- Eni Merakes iEPCI™ Project
(Indonesia)Large* iEPCI™ contract by Eni for the Merakes
project. This contract covers five deepwater wells, and their
50-kilometer tie back to the existing Jangkrik Floating Production
Unit in Indonesia. The project scope includes engineering,
procurement, installation and pre-commissioning of subsea
equipment.* A “large” award ranges between $500 million and $1
billion.
- Total Lapa Pre-Salt Project
(Brazil)Significant* contract for the Lapa field by Total. The
contract covers the supply of flexible pipes for oil production,
gas lift and gas injection as well as associated accessories. The
field will be connected to the floating production storage and
offloading unit (FPSO) Cidade de Caraguatatuba, already in
operation.* A “significant” award ranges between $75 million and
$250 million.
Subsea
Estimated Backlog Scheduling as of March
31, 2019
(In millions)
Consolidated
backlog*
Non-
consolidated
backlog**
2019 (9 months) $3,387.1 $140.3
2020
$2,480.3 $136.7
2021 and beyond
$1,609.9 $659.6
Total $7,477.3
$936.6
* Backlog does not capture all revenue potential for
subsea services.
** Non-consolidated backlog reflects the proportional
share of backlog related to joint ventures that is not consolidated
due to our minority ownership position.
Onshore/Offshore
Financial Highlights
Reconciliation of U.S. GAAP to non-GAAP financial measures are
below and in financial schedules.
Three Months Ended
(In millions)
March 31,
2019
March 31,
2018
Change Revenue $1,335.1 $1,573.4
(15.1%)
Operating profit $155.7 $202.9
(23.3%)
Adjusted EBITDA $194.8 $215.0
(9.4%)
Adjusted EBITDA margin 14.6%
13.7% 93 bps
Inbound orders $3,138.9 $1,849.6
69.7%
Backlog $9,862.7 $7,491.6 31.7%
Onshore/Offshore reported first quarter revenue of $1,335.1
million. Revenue decreased 15.1 percent from the prior-year quarter
as we moved closer to completion on major projects, primarily Yamal
LNG. Projects awarded in recent quarters are in early stages of
completion and will contribute more significantly in subsequent
quarters as the projects progress.
Onshore/Offshore reported operating profit of $155.7 million;
adjusted EBITDA was $194.8 million with a margin of 14.6 percent.
Operating profit decreased 23.3 percent versus the prior-year
quarter primarily due to the revenue decline and a change in
revenue mix. These same factors drove the year-over-year decrease
in adjusted EBITDA; adjusted EBITDA margin increased 93 basis
points from the prior-year results.
First Quarter Onshore/Offshore Highlights
- MIDOR refinery (Egypt)Detailed
design and procurement activities as well as site preparation
ongoing.
- BP Tortue Ahmeyim gas FPSO
(Mauritania and Senegal)Engineering, Procurement, and
Construction (EPC) phase launched following successful delivery of
FEED.
- Sasol petrochemical complex (United
States)TechnipFMC and partners completed construction scope of
work on Sasol Project in Louisiana.
- Shell Prelude FLNG
(Australia)Performed first condensate export at the end of
March.
Onshore/Offshore inbound orders for the quarter were $3,138.9
million, resulting in a book-to-bill of 2.4. The following
announced awards were included in the period:
- ExxonMobil Refinery Expansion
(United States)Large* reimbursable contract from ExxonMobil for
detailed engineering, procurement, and construction for the
recently announced crude expansion project in Beaumont, Texas. The
awarded scope covers the addition of four new units – atmospheric
pipe still, kerosene hydrotreater, diesel hydrotreater and benzene
recovery at ExxonMobil’s Refinery.* A “large” award ranges between
$500 million and $1 billion.
- BP Greater Tortue Ahmeyim
Development FPSO (Mauritania and Senegal)Large* contract by BP
for the engineering, procurement, construction, installation and
commissioning (EPCIC) of the FPSO unit to be deployed offshore on
the maritime border of Mauritania and Senegal. This award is a
continuation to the FEED contract awarded in April 2018.* A “large”
award ranges between $500 million and $1 billion.
- MIDOR Refinery Expansion and
Modernization (Egypt)Major* EPC contract by Middle East Oil
Refinery (MIDOR) for the modernization and expansion of their
existing complex near Alexandria, Egypt. This EPC contract covers
the debottlenecking of existing units as well as the delivery of
new units including a Crude Distillation Unit, a Vacuum
Distillation Unit, a hydrogen production facility based on our
steam reforming technology, as well as various process units,
interconnecting, offsites and utilities.* A “major” award is over
$1 billion.
In addition to these announced awards in the period, we continue
to strengthen our Process Technology business unit with important
new partnerships, including:
- Mid-scale, modular LNG solutions
offeringWe have developed a number of standardized, modular
mid-scale LNG train designs with capacities ranging from 1 to 3
Mtpa (million metric tons per annum) using Air Products’ AP-SMR™
and AP-DMR™ processes. Delivered by Engineering Procurement and
Fabrication models, these designs offer more certainty around cost
and schedule. We have received contracts in China and North
America.
- ExxonMobil Chemicals Master License
and Engineering Agreement (MLEA) for Ethylene
technologyLong-term MLEA for our proprietary ethylene
technology and process design package starting with a proposed 1.2
million tons plant in Huizhou, China.
Onshore/Offshore
Estimated Backlog Scheduling as of March
31, 2019
(In millions)
Consolidated
backlog
Non-
consolidated
backlog*
2019 (9 months) $4,299.4 $564.8
2020
$3,252.3 $642.6
2021 and beyond
$2,311.0 $558.3
Total $9,862.7
$1,765.7
* Non-consolidated backlog reflects the proportional share of
backlog related to joint ventures that is not consolidated due to
our minority ownership position.
Surface Technologies
Financial Highlights
Reconciliation of U.S. GAAP to non-GAAP financial measures are
below and in financial schedules.
Three Months Ended
(In millions)
March 31,
2019
March 31,
2018
Change Revenue $392.6 $371.6
5.7%
Operating profit $10.5 $30.6
(65.7%)
Adjusted EBITDA $30.1 $50.3
(40.2%)
Adjusted EBITDA margin 7.7%
13.5% (587 bps)
Inbound orders $368.0 $409.6
(10.2%)
Backlog $437.6 $409.5 6.9%
Surface Technologies reported first quarter revenue of $392.6
million, an increase of 5.7 percent from the prior-year quarter.
The revenue growth was primarily driven by higher demand for
pressure control equipment outside the Americas. North American
revenue declined in the period as a result of lower activity.
Surface Technologies reported operating profit of $10.5 million;
adjusted EBITDA was $30.1 million with a margin of 7.7 percent.
Operating profit decreased versus the prior-year quarter primarily
due to the continued decline in completions-related activity,
one-time charges related to new product introduction and
unfavorable product line mix in North America. Operating profit
outside the Americas was negatively impacted by delays in shipments
of backlog orders now expected to be delivered throughout 2019.
These same factors drove the year-over-year decrease in adjusted
EBITDA.
North American activity has declined further since the fourth
quarter of 2018. Completions-related revenue declined mid-single
digits in the quarter, below levels anticipated when 2019 financial
guidance was provided in December. The Company now expects North
American activity for the remainder of the year to remain largely
unchanged from current levels. Reduced operator spending in North
America has also negatively impacted pricing as the market adjusts
to the excess product and service supply created by the lower
activity.
Outside the Americas, the Company continues to anticipate
high-single digit to low-double digit activity growth, supported by
the Middle East market. We expect limited benefit from pricing in
2019.
Inbound orders for the quarter were $368 million. Backlog was
$437.6 million. Given the short-cycle nature of the business,
orders are generally converted into revenue within twelve
months.
Corporate and Other Items
Corporate expense in the first quarter was $93.6 million. This
includes charges and credits totaling $21 million of expense
associated with the merger as well as restructuring and other
severance charges. Excluding charges and credits, corporate expense
was $72.6 million which included $11.6 million of foreign exchange
losses.
Net interest expense was $88.2 million in the quarter, which
included an increase in the liability payable to joint venture
partners of $84.7 million.
The Company recorded a tax provision during the quarter of $14.5
million. Adjusted net income was negatively impacted by the
reversal of a $40.3 million non-cash valuation allowance which will
benefit tax expense in future periods.
Total depreciation and amortization for the quarter was $119.4
million, including depreciation and amortization related to
purchase price accounting for the merger of $8.5 million.
The Company repurchased 2.2 million shares during the quarter.
Total consideration was $50.1 million; cash impact in the quarter
was $33 million due to the timing of settlement.
Cash flow from operations in the quarter was $121.4 million. The
Company ended the period with cash and cash equivalents of $4,965.3
million; net cash was $1,031.4 million.
Other Accounting Items
On January 1, 2019, we adopted ASU 2016-02, Leases (Topic 842),
using a modified retrospective transition method and applying the
new standard to all leases.
Adoption of the new lease accounting guidance had a material
impact on our consolidated balance sheet but did not have a
material impact on our consolidated income statement. As of March
31, 2019, the balances of our operating lease liability and
operating lease right-of-use asset were as follows:
- an operating lease liability of
approximately $1,133.9 million which represents the present value
of the remaining lease payments discounted using the Company’s
applicable weighted average incremental borrowing rates; and
- an operating lease right-of-use asset
of approximately $1,105.9 million which represents the lease
liability of $1,133.9 million adjusted for lease incentives,
prepaid rent, and other balances.
The difference between the additional lease assets and lease
liabilities, net of the deferred tax impact, was recorded as an
adjustment to reduce retained earnings by approximately $1.8
million ($2.3 million prior to tax effect).
Details regarding the adoption of IFRS 16 will be provided in
the Half-Year Financial Report for the half year ending June 30,
2019.
2019 Financial Guidance1
Updates to the Company’s full-year guidance for 2019 are
included in the revised table below and detailed on the following
page:
2019 Guidance *Updated April 25, 2019
Subsea
Onshore/Offshore Surface Technologies
Revenue in a range of $5.4 – 5.7 billion Revenue in a range of $6.0
– 6.3 billion* Revenue in a range of $1.6 – 1.7 billion*
EBITDA margin at least 11% (excluding amortization related impact
of purchase price accounting, and other charges and credits) EBITDA
margin at least 14%* (excluding amortization related impact of
purchase price accounting, and other charges and credits) EBITDA
margin at least 12%* (excluding amortization related impact of
purchase price accounting, and other charges and credits)
TechnipFMC Corporate expense,
net $160 – 170 million for the full year (excluding the impact
of foreign currency fluctuations)
Net interest
expense $40 – 60 million for the full year (excluding the
impact of revaluation of partners’ redeemable financial liability)
Tax rate 28 – 32% for the full year (excluding the
impact of discrete items)
Capital expenditures
approximately $350 million for the full year
Cash flow
from operating activities positive for the full year
Merger integration and restructuring costs approximately $50
million for the full year
Cost synergies $450 million
total savings ($220m exit run-rate 12/31/17, $400m exit run-rate
12/31/18, $450m exit run-rate 12/31/19)
_______________________________
1 Our guidance measures adjusted EBITDA margin, corporate
expense, net (excluding the impact of foreign currency
fluctuations), net interest expense (excluding the impact of
revaluation of partners’ redeemable financial liability), and tax
rate (excluding the impact of discrete items) are non-GAAP
financial measures. We are unable to provide a reconciliation to
comparable GAAP financial measures on a forward-looking basis
without unreasonable effort because of the unpredictability of the
individual components of the most directly comparable GAAP
financial measure and the variability of items excluded from each
such measure. Such information may have a significant, and
potentially unpredictable, impact on our future financial
results.
Updates to the Company’s full-year guidance for 2019 are
detailed below:
- Onshore/Offshore revenue in a range of
$6.0 – 6.3 billion; revenue has been increased from the previous
guidance range of $5.7 – 6.0 billion.
- Onshore/Offshore EBITDA margin of at
least 14% (excluding amortization related impact of purchase price
accounting, and other charges and credits); EBITDA margin guidance
has been increased from the previous guidance of at least 12%.
- Surface Technologies revenue in a range
of $1.6 – 1.7 billion; revenue has been decreased from the previous
guidance range of $1.7 – 1.8 billion.
- Surface Technologies EBITDA margin of
at least 12% (excluding amortization related impact of purchase
price accounting, and other charges and credits); EBITDA margin
guidance has been decreased from the previous guidance of at least
17%.
Teleconference
The Company will host a teleconference on Friday, April 26, 2019
to discuss the first quarter 2019 financial results. The call will
begin at 1 p.m. London time (8 a.m. New York time). Dial-in
information and an accompanying presentation can be found at
www.technipfmc.com.
Webcast access will also be available on our website prior to
the start of the call. An archived audio replay will be available
after the event at the same website address. In the event of a
disruption of service or technical difficulty during the call,
information will be posted on our website.
###
About TechnipFMC
TechnipFMC is a global leader in subsea, onshore/offshore, and
surface projects. With our proprietary technologies and production
systems, integrated expertise, and comprehensive solutions, we are
transforming our clients’ project economics.
We are uniquely positioned to deliver greater efficiency across
project lifecycles from concept to project delivery and beyond.
Through innovative technologies and improved efficiencies, our
offering unlocks new possibilities for our clients in developing
their oil and gas resources.
Each of our more than 37,000 employees is driven by a steady
commitment to clients and a culture of purposeful innovation,
challenging industry conventions, and rethinking how the best
results are achieved.
To learn more about us and how we are enhancing the performance
of the world’s energy industry, go to TechnipFMC.com and follow us
on Twitter @TechnipFMC.
This communication contains “forward-looking statements” as
defined in Section 27A of the United States Securities Act of 1933,
as amended, and Section 21E of the United States Securities
Exchange Act of 1934, as amended. Words such as “guidance,”
“confident,” “believe,” “expect,” “anticipate,” “plan,” “intend,”
“foresee,” “should,” “would,” “could,” “may,” “will,” “likely,”
“predicated,” “estimate,” “outlook” and similar expressions are
intended to identify forward-looking statements, which are
generally not historical in nature. Such forward-looking statements
involve significant risks, uncertainties and assumptions that could
cause actual results to differ materially from our historical
experience and our present expectations or projections, including
the following known material factors:
- unanticipated changes relating to
competitive factors in our industry;
- demand for our products and services,
which is affected by changes in the price of, and demand for, crude
oil and natural gas in domestic and international markets;
- our ability to develop and implement
new technologies and services, as well as our ability to protect
and maintain critical intellectual property assets;
- potential liabilities arising out of
the installation or use of our products;
- cost overruns related to our fixed
price contracts or capital asset construction projects that may
affect revenues;
- our ability to timely deliver our
backlog and its effect on our future sales, profitability, and our
relationships with our customers;
- our reliance on subcontractors,
suppliers and joint venture partners in the performance of our
contracts;
- our ability to hire and retain key
personnel;
- piracy risks for our maritime employees
and assets;
- the potential impacts of seasonal and
weather conditions;
- the cumulative loss of major contracts
or alliances;
- U.S. and international laws and
regulations, including existing or future environmental
regulations, that may increase our costs, limit the demand for our
products and services or restrict our operations;
- disruptions in the political,
regulatory, economic and social conditions of the countries in
which we conduct business;
- risks associated with The Depository
Trust Company and Euroclear for clearance services for shares
traded on the NYSE and Euronext Paris, respectively;
- the United Kingdom’s proposed
withdrawal from the European Union; risks associated with being an
English public limited company, including the need for
“distributable profits”, shareholder approval of certain capital
structure decisions, and the risk that we may not be able to pay
dividends or repurchase shares in accordance with our announced
capital allocation plan;
- compliance with covenants under our
debt instruments and conditions in the credit markets;
- downgrade in the ratings of our debt
could restrict our ability to access the debt capital markets;
- the outcome of uninsured claims and
litigation against us;
- the risks of currency exchange rate
fluctuations associated with our international operations;
- significant merger-related costs;
- risks related to our acquisition and
divestiture activities;
- failure of our information technology
infrastructure or any significant breach of security, including
related to cyber attacks, and actual or perceived failure to comply
with data security and privacy obligations;
- risks that the legacy businesses of FMC
Technologies, Inc. and Technip S.A. will not be integrated
successfully or that the combined company will not realize
estimated cost savings, value of certain tax assets, synergies and
growth or that such benefits may take longer to realize than
expected;
- risks associated with tax liabilities,
changes in U.S. federal or international tax laws or
interpretations to which they are subject;
- the remedial measures to address our
material weaknesses could be insufficient or additional issues
relating to disclosure controls and procedures or internal control
over financial reporting could be identified; and
- such other risk factors set forth in
our filings with the United States Securities and Exchange
Commission and in our filings with the Autorité des marchés
financiers or the U.K. Financial Conduct Authority.
We caution you not to place undue reliance on any
forward-looking statements, which speak only as of the date hereof.
We undertake no obligation to publicly update or revise any of our
forward-looking statements after the date they are made, whether as
a result of new information, future events or otherwise, except to
the extent required by law.
Exhibit 1
TECHNIPFMC PLC
AND CONSOLIDATED SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per share
data)
(Unaudited) Three Months Ended March
31, 2019 2018 Revenue $ 2,913.0 $
3,125.2 Costs and expenses 2,778.2 2,885.9 134.8
239.3 Other (expense) income, net (12.3 ) (11.2 )
Income before net interest expense and income taxes 122.5 228.1 Net
interest expense (88.2 ) (87.4 ) Income before income taxes
34.3 140.7 Provision for income taxes 14.5 49.3
Net income 19.8 91.4 Net loss attributable to noncontrolling
interests 1.1 3.7 Net income attributable to
TechnipFMC plc $ 20.9 $ 95.1 Earnings per
share attributable to TechnipFMC plc: Basic $ 0.05 $ 0.20 Diluted $
0.05 $ 0.20 Weighted average shares outstanding: Basic 450.1
464.3 Diluted 453.3 465.7 Cash dividends declared per share
$ 0.13 $ 0.13
Exhibit 2
TECHNIPFMC PLC
AND CONSOLIDATED SUBSIDIARIES
BUSINESS SEGMENT
DATA
(In millions)
(Unaudited) Three Months Ended March
31, 2019 2018
Revenue
Subsea $ 1,185.3 $ 1,180.2 Onshore/Offshore 1,335.1 1,573.4
Surface Technologies 392.6 371.6 $ 2,913.0 $
3,125.2
Income before
income taxes
Segment operating
profit (loss)
Subsea $ 49.9 $ 54.4 Onshore/Offshore 155.7 202.9 Surface
Technologies 10.5 30.6 Total segment operating profit
216.1 287.9
Corporate
items
Corporate expense (1) (93.6 ) (59.8 ) Net interest expense (88.2 )
(87.4 ) Total corporate items (181.8 ) (147.2 ) Net income
before income taxes (2) $ 34.3 $ 140.7
(1) Corporate expense primarily includes corporate staff
expenses, share-based compensation expenses, other employee
benefits, certain foreign exchange gains and losses, and merger
transaction and integration expenses.
(2) Includes amounts attributable to noncontrolling
interests.
Exhibit 3
TECHNIPFMC PLC
AND CONSOLIDATED SUBSIDIARIES
BUSINESS SEGMENT
DATA
(In millions, unaudited)
Three Months Ended
Inbound
Orders (1)
March 31, 2019 2018 Subsea $
2,677.6 $ 1,227.8 Onshore/Offshore 3,138.9 1,849.6 Surface
Technologies 368.0 409.6 Total inbound orders $ 6,184.5
$ 3,487.0
Order
Backlog (2)
March 31, 2019 2018 Subsea $ 7,477.3 $
6,110.9 Onshore/Offshore 9,862.7 7,491.6 Surface Technologies 437.6
409.5 Total order backlog $ 17,777.6 $ 14,012.0
(1) Inbound orders represent the estimated sales value of
confirmed customer orders received during the reporting period.
(2) Order backlog is calculated as the estimated sales value of
unfilled, confirmed customer orders at the reporting date.
Exhibit 4
TECHNIPFMC PLC
AND CONSOLIDATED SUBSIDIARIES
CONDENSED
CONSOLIDATED BALANCE SHEETS
(In millions)
(Unaudited) March 31, 2019
December 31, 2018 Cash and cash equivalents $
4,965.3 $ 5,540.0 Trade receivables, net 2,250.3 2,469.7 Contract
assets 1,383.7 1,295.0 Inventories, net 1,315.2 1,251.2 Other
current assets 1,337.6 1,225.3 Total current assets 11,252.1
11,781.2 Property, plant and equipment, net 3,381.9 3,259.8
Goodwill 7,603.4 7,607.6 Intangible assets, net 1,156.9 1,176.7
Other assets 2,277.6 959.2 Total assets $ 25,671.9 $
24,784.5 Short-term debt and current portion of long-term
debt $ 208.9 $ 67.4 Accounts payable, trade 2,464.5 2,600.3
Contract liabilities 4,252.2 4,085.1 Other current liabilities
2,702.9 2,381.6 Total current liabilities 9,628.5 9,134.4
Long-term debt, less current portion 3,725.0 4,124.3 Other
liabilities 1,864.3 1,056.4 Redeemable noncontrolling interest 38.5
38.5 TechnipFMC plc stockholders’ equity 10,384.7 10,399.6
Noncontrolling interests 30.9 31.3 Total liabilities and
equity $ 25,671.9 $ 24,784.5
Exhibit 5
TECHNIPFMC PLC
AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited) Three Months Ended March
31, 2019 2018 Cash provided (required) by
operating activities Net income $ 19.8 $ 91.4 Adjustments to
reconcile net income (loss) to cash provided (required) by
operating activities Depreciation 88.9 86.4 Amortization 30.5 45.4
Impairments 0.9 0.4 Employee benefit plan and share-based
compensation costs 20.9 7.4 Deferred income tax provision
(benefit), net (90.8 ) (59.9 ) Unrealized loss on derivative
instruments and foreign exchange 29.2 7.3 Income from equity
affiliates, net of dividends received (9.9 ) (13.2 ) Other 72.7
136.0 Changes in operating assets and liabilities, net of effects
of acquisitions Trade receivables, net and contract assets 131.8
(522.7 ) Inventories, net (61.5 ) (59.7 ) Accounts payable, trade
(148.6 ) (332.2 ) Contract liabilities 186.1 462.0 Income taxes
payable (receivable), net 20.8 15.9 Other current assets and
liabilities, net (126.3 ) 39.7 Other noncurrent assets and
liabilities, net (43.1 ) (105.8 ) Cash provided (required) by
operating activities 121.4 (201.6 ) Cash provided
(required) by investing activities Capital expenditures (178.2 )
(53.2 ) Payment to acquire debt securities (59.7 ) — Acquisitions,
net of cash acquired — (62.0 ) Proceeds from sale of assets 0.9 1.8
Other — (0.2 ) Cash provided (required) by investing
activities (237.0 ) (113.6 ) Cash required by financing
activities Net increase in short-term debt 114.5 2.4 Net decrease
in commercial paper (450.4 ) (117.6 ) Proceeds from issuance of
long-term debt 96.2 0.5 Repayments of long-term debt — (5.3 )
Purchase of ordinary shares (33.0 ) (92.6 ) Settlements of
mandatorily redeemable financial liability (174.9 ) — Other —
1.4 Cash required by financing activities (447.6 )
(211.2 ) Effect of changes in foreign exchange rates on cash and
cash equivalents (11.5 ) 9.6 Increase (decrease) in cash and
cash equivalents (574.7 ) (516.8 ) Cash and cash equivalents,
beginning of period 5,540.0 6,737.4 Cash and cash
equivalents, end of period $ 4,965.3 $ 6,220.6
Exhibit 6
TECHNIPFMC PLC AND
CONSOLIDATED SUBSIDIARIESRECONCILIATION OF GAAP TO NON-GAAP FINANCIAL
MEASURES(In millions, unaudited)
Charges and Credits
In addition to financial results determined in accordance with
U.S. generally accepted accounting principles (GAAP), the first
quarter 2019 Earnings Release also includes non-GAAP financial
measures (as defined in Item 10 of Regulation S-K of the Securities
Exchange Act of 1934, as amended) and describes performance on a
year-over-year basis against 2018 results and measures. Net income,
excluding charges and credits, as well as measures derived from it
(including Diluted EPS, excluding charges and credits; Income
before net interest expense and taxes, excluding charges and
credits ("Adjusted Operating profit"); Depreciation and
amortization, excluding charges and credits; Earnings before net
interest expense, income taxes, depreciation and amortization,
excluding charges and credits ("Adjusted EBITDA"); and net cash)
are non-GAAP financial measures. Management believes that the
exclusion of charges and credits from these financial measures
enables investors and management to more effectively evaluate
TechnipFMC's operations and consolidated results of operations
period-over-period, and to identify operating trends that could
otherwise be masked or misleading to both investors and management
by the excluded items. These measures are also used by management
as performance measures in determining certain incentive
compensation. The foregoing non-GAAP financial measures should be
considered by investors in addition to, not as a substitute for or
superior to, other measures of financial performance prepared in
accordance with GAAP. The following is a reconciliation of the most
comparable financial measures under GAAP to the non-GAAP financial
measures.
Three Months Ended March 31, 2019 Net
income (loss) attributable to TechnipFMC plc Net
income (loss) attributable to noncontrolling interests
Provision for income taxes Net interest
expense Income (loss) before net interest expense and
income taxes (Operating profit) Depreciation and
amortization Earnings (loss) before net interest
expense, income taxes, depreciation and amortization (EBITDA)
TechnipFMC plc, as reported $ 20.9 $ (1.1 ) $ 14.5 $ 88.2 $ 122.5 $
119.4 $ 241.9 Charges and (credits): Impairment and other
charges 0.5 — 0.2 — 0.7 — 0.7 Restructuring and other severance
charges 11.6 — 4.2 — 15.8 — 15.8 Business combination transaction
and integration costs 8.9 — 3.2 — 12.1 — 12.1 Reorganization 19.2 —
6.1 — 25.3 — 25.3 Purchase price accounting adjustment 6.5 — 2.0 —
8.5 (8.5 ) — Valuation allowance (40.3 ) — 40.3 —
— — — Adjusted financial measures $ 27.3
$ (1.1 ) $ 70.5 $ 88.2 $ 184.9 $ 110.9
$ 295.8 Diluted earnings (loss) per share
attributable to TechnipFMC plc, as reported $ 0.05 Adjusted diluted
earnings (loss) per share attributable to TechnipFMC plc $ 0.06
Three Months Ended March 31, 2018
Net income attributable to TechnipFMC plc Net
income (loss) attributable to noncontrolling interests
Provision for income taxes Net interest
expense Income before net interest expense and income
taxes (Operating profit) Depreciation and
amortization Earnings before net interest expense,
income taxes, depreciation and amortization (EBITDA) TechnipFMC
plc, as reported $ 95.1 $ (3.7 ) $ 49.3 $ 87.4 $ 228.1 $ 131.8 $
359.9 Charges and (credits): Impairment and other charges
2.2 — 0.8 — 3.0 — 3.0 Restructuring and other severance charges 6.2
— 2.3 — 8.5 — 8.5 Business combination transaction and integration
costs 4.1 — 1.5 — 5.6 — 5.6 Purchase price accounting adjustment
23.9 — 7.4 — 31.3 (21.7 ) 9.6
Adjusted financial measures $ 131.5 $ (3.7 ) $ 61.3 $
87.4 $ 276.5 $ 110.1 $ 386.6 Diluted
earnings (loss) per share attributable to TechnipFMC plc, as
reported $ 0.20 Adjusted diluted earnings (loss) per share
attributable to TechnipFMC plc $ 0.28
Exhibit 7
TECHNIPFMC PLC
AND CONSOLIDATED SUBSIDIARIES
RECONCILIATION OF
GAAP TO NON-GAAP FINANCIAL MEASURES
(In millions, unaudited)
Three Months Ended March 31, 2019
Subsea Onshore/Offshore
Surface
Technologies
Corporate
and Other
Total Revenue $ 1,185.3 $ 1,335.1 $ 392.6 $ — $
2,913.0 Operating profit (loss), as reported (pre-tax) $
49.9 $ 155.7 $ 10.5 $ (93.6 ) $ 122.5 Charges and (credits):
Impairment and other charges 0.7 — — — 0.7 Restructuring and other
severance charges 1.6 3.8 1.5 8.9 15.8 Business combination
transaction and integration costs — — — 12.1 12.1 Reorganization —
25.3 — — 25.3 Purchase price accounting adjustments - amortization
related 8.5 — — — 8.5 Subtotal
10.8 29.1 1.5 21.0 62.4 Adjusted
Operating profit (loss) 60.7 184.8 12.0 (72.6
) 184.9 Adjusted Depreciation and amortization 79.0
10.0 18.1 3.8 110.9 Adjusted
EBITDA $ 139.7 $ 194.8 $ 30.1 $ (68.8 ) $
295.8 Operating profit margin, as reported 4.2 % 11.7
% 2.7 % 4.2 % Adjusted Operating profit margin 5.1 % 13.8 %
3.1 % 6.3 % Adjusted EBITDA margin 11.8 % 14.6 % 7.7 % 10.2
%
Three Months Ended March 31, 2018
Subsea Onshore/Offshore
Surface
Technologies
Corporate
and Other
Total Revenue $ 1,180.2 $ 1,573.4 $ 371.6 $ — $
3,125.2 Operating profit (loss), as reported (pre-tax) $
54.4 $ 202.9 $ 30.6 $ (59.8 ) $ 228.1 Charges and (credits):
Impairment and other charges 0.4 2.6 — — 3.0 Restructuring and
other severance charges 2.7 0.9 2.4 2.5 8.5 Business combination
transaction and integration costs — — — 5.6 5.6 Purchase price
accounting adjustments - non-amortization related 6.0 — 3.6 — 9.6
Purchase price accounting adjustments - amortization related 21.9
— (0.1 ) (0.1 ) 21.7 Subtotal 31.0 3.5 5.9 8.0
48.4 Adjusted Operating profit
(loss) 85.4 206.4 36.5 (51.8 ) 276.5
Adjusted Depreciation and amortization 86.6 8.6 13.8 1.1
110.1 Adjusted EBITDA $ 172.0
$ 215.0 $ 50.3 $ (50.7 ) $ 386.6
Operating profit margin, as reported 4.6 % 12.9 % 8.2 % 7.3 %
Adjusted Operating profit margin 7.2 % 13.1 % 9.8 % 8.8 %
Adjusted EBITDA margin 14.6 % 13.7 % 13.5 % 12.4 %
Exhibit 8
TECHNIPFMC PLC
AND CONSOLIDATED SUBSIDIARIES
RECONCILIATION OF
GAAP TO NON-GAAP FINANCIAL MEASURES
(In millions, unaudited)
March 31, 2019 December 31,
2018 Cash and cash equivalents $ 4,965.3 $ 5,540.0
Short-term debt and current portion of long-term debt (208.9 )
(67.4 ) Long-term debt, less current portion (3,725.0 ) (4,124.3 )
Net cash $ 1,031.4 $ 1,348.3
Net (debt) cash, is a non-GAAP financial measure reflecting cash
and cash equivalents, net of debt. Management uses this non-GAAP
financial measure to evaluate our capital structure and financial
leverage. We believe net debt, or net cash, is a meaningful
financial measure that may assist investors in understanding our
financial condition and recognizing underlying trends in our
capital structure. Net (debt) cash should not be considered an
alternative to, or more meaningful than, cash and cash equivalents
as determined in accordance with U.S. GAAP or as an indicator of
our operating performance or liquidity.
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Investor relationsMatt SeinsheimerVice President Investor
RelationsTel: +1 281 260 3665Email: Matt Seinsheimer
Phillip LindsayDirector Investor Relations (Europe)Tel: +44 (0)
20 3429 3929Email: Phillip Lindsay
Media relationsChristophe BélorgeotSenior Vice President
Corporate EngagementTel: +33 1 47 78 39 92Email: Christophe
Belorgeot
Delphine NayralDirector Public RelationsTel: +33 1 47 78 34
83Email: Delphine Nayral