10-QPeriod: Q3 FY2021

TechnipFMC plc Quarterly Report for Q3 Ended Sep 30, 2021

Filed October 27, 2021For Securities:FTI

Summary

TechnipFMC plc (FTI) reported mixed financial results for the nine months ended September 30, 2021. Total revenue saw a slight decrease compared to the same period in 2020, primarily driven by lower activity in the Subsea segment, although the Surface Technologies segment showed an increase. The company generated positive operating cash flow from continuing operations, but net income attributable to TechnipFMC plc was $169.0 million for the nine months, a significant improvement from a net loss of $3,248.3 million in the prior year. This improvement is largely due to the absence of substantial impairment charges recorded in 2020 and the gain from the sale of its investment in Technip Energies. The company also reduced its overall debt significantly, ending the period with a net cash position. Looking ahead, TechnipFMC sees a positive outlook for crude oil prices and an increasing demand for energy. The company is strategically positioning itself to benefit from the ongoing recovery in the offshore market and the transition to renewable energy, evidenced by its investments in areas like carbon capture and storage and advanced composite technologies.

Financial Highlights

49 data points
Beta

Revenue

$1.58B

Net Income

-$32.20M

-2.0% Net Margin

EPS (Diluted)

$-0.07

Total Assets

$10.25B

Cash & Equivalents

$1.03B

Free Cash Flow

$88.60M

Financial Statements
Beta
Revenue$1.58B
R&D Expenses$18.70M
SG&A Expenses$153.40M
Operating Expenses$1.54B
Operating Income$35.60M
Interest Expense$41.40M
Net Income-$32.20M
EPS (Basic)$-0.07
EPS (Diluted)$-0.07
Shares Outstanding (Basic)450.70M
Shares Outstanding (Diluted)450.70M

Key Highlights

  • 1Total revenue for the nine months ended September 30, 2021, was $4.88 billion, a slight decrease of 1.0% from $4.93 billion in the prior year. This was primarily due to decreased Subsea revenue, while Surface Technologies revenue saw a slight decline.
  • 2The company reported a net income attributable to TechnipFMC plc of $169.0 million for the nine months ended September 30, 2021, a substantial recovery from a net loss of $3,248.3 million in the same period of 2020. This improvement is largely due to significantly lower impairment, restructuring, and other expenses ($34.8 million in 2021 vs. $3,356.2 million in 2020) and a gain from the investment in Technip Energies.
  • 3Operating cash flow from continuing operations for the nine months was $231.5 million, compared to $289.7 million in the prior year, indicating a strong ability to generate cash from its ongoing business activities.
  • 4TechnipFMC significantly reduced its long-term debt, ending the period with a net cash position of $1,221.8 million, a substantial improvement from a net debt of $2,191.0 million at December 31, 2020.
  • 5The Subsea segment's order backlog remained strong at $6.7 billion, and inbound orders for the segment reached $3.9 billion for the nine months, indicating robust future business potential.
  • 6The company is strategically expanding into new energy markets, including wind, wave, hydrogen, and carbon capture and storage, highlighted by the acquisition of Magma Global and an alliance with Talos Energy.
  • 7The disposal of its investment in Technip Energies significantly impacted investing activities, providing substantial cash proceeds ($784.5 million in nine months of 2021) and contributing positively to the overall financial results.

Frequently Asked Questions

Total revenue decreased slightly by 1.0% to $4.88 billion for the nine months ended September 30, 2021, compared to the same period in 2020. The Subsea segment experienced lower activity, particularly in the Gulf of Mexico and North Sea, leading to reduced revenue. While the Surface Technologies segment saw a slight decrease overall, it was driven by a reduction in operator activity in North America, though international markets showed some growth.

The spin-off of Technip Energies, completed in February 2021, resulted in Technip Energies' historical results being presented as discontinued operations. TechnipFMC also recorded significant income from the sale of its retained stake in Technip Energies, which positively impacted the net income for the period. The company's investment in Technip Energies contributed $351.8 million in income for the nine months ended September 30, 2021, primarily due to fair value revaluation gains and proceeds from share sales.

TechnipFMC significantly improved its liquidity and debt position. As of September 30, 2021, the company had $1,034.0 million in cash and cash equivalents and managed to reduce its total debt, resulting in a net cash position of $1,221.8 million. This is a substantial improvement from a net debt of $2,191.0 million at December 31, 2020. The company also has a $1.0 billion revolving credit facility with $927.1 million available as of September 30, 2021, providing ample financial flexibility.

TechnipFMC is focused on recovering and expanding in the offshore market, leveraging its integrated Subsea offering (iEPCI™). The company is also strategically diversifying into new energy sectors, including offshore wind, hydrogen, and carbon capture and storage, as demonstrated by its acquisition of Magma Global and alliance with Talos Energy. The outlook for crude oil prices is seen as positive, supporting increased investment in traditional oil and gas production, while the company is also positioning itself for the long-term energy transition.