01—Abstract
Summary
Summary of the 10-Q filed April 26, 2024. Cited figures are marked; the original filing is the authoritative source.
TechnipFMC plc (FTI) reported a strong first quarter in 2024, with total revenue increasing by 18.9% year-over-year to $2,042.0 milliona.
This growth was primarily driven by the Subsea segment, which saw a significant increase in revenue and operating profit. The company also completed the sale of its Measurement Solutions business, recognizing a substantial gain. Despite an increase in cash used by operating activities, overall liquidity remains strong with ample availability under its revolving credit facility.
The company also announced an upgrade to investment grade credit rating by S&P Global Ratings. Financially, TechnipFMC demonstrated significant improvement, with net income attributable to TechnipFMC plc soaring to $157.1 millionb from $0.4 million in the prior year's quarter. This was bolstered by the gain on the disposal of the Measurement Solutions business.
The company continues to focus on its core Subsea and Surface Technologies segments, with a robust order backlog providing visibility for future revenue. Management expresses confidence in the ongoing resilience of the energy market and highlights strategic initiatives in areas like offshore wind, carbon capture, and hydrogen solutions.
02—Key points
Key Highlights
- Total revenue for the first quarter of 2024 increased by 18.9% to $2,042.0 million, driven by strong performance in the Subsea segment.
- Net income attributable to TechnipFMC plc significantly improved, reaching $157.1 million ($0.35/0.36 diluted/basic EPS) compared to $0.4 million ($0.00 EPS) in Q1 2023, largely due to a $75.2 million gain on the sale of the Measurement Solutions business.
- The Subsea segment reported a substantial revenue increase of 25.0% to $1,734.8 million and operating profit grew by 134.4% to $156.6 million.
- The company completed the sale of its Measurement Solutions business on March 11, 2024, for $186.1 million in cash, recognizing a gain on disposal.
- The order backlog remained strong, totaling $13,492.5 million as of March 31, 2024, with the Subsea segment backlog increasing to $12,455.5 million.
- TechnipFMC's credit rating was upgraded to investment grade ('BBB-') by S&P Global Ratings on March 7, 2024.
- The company continued its capital return program, repurchasing $150.1 million of shares and paying $21.7 million in dividends during the quarter.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2024, TechnipFMC plc kept $0.08.
- Revenue$2.04B100.0%
- Cost of revenue−$1.71B83.6%
- Gross profit$335.8M16.4%
- Operating costs−$75.8M3.7%
- Operating income$260.0M12.7%
- Interest, other & tax−$102.9M5.0%
- Net income$157.1M7.7%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2024filed April 26, 2024Financial Statements
Q1 FY2024 against Q1 FY2023
| Line item | Q1 FY2024Q1 FY2023 | Change |
|---|---|---|
| Revenue | $2.04B$1.72B | +18.9% |
| Cost of Revenue | $1.71B— | — |
| Gross Profit | $335.80M— | — |
| R&D Expenses | $17.60M$15.40M | +14.3% |
| SG&A Expenses | $159.80M$153.90M | +3.8% |
| Operating Expenses | $1.88B$1.67B | +13.0% |
| Operating Income | $260.00M$89.20M | +191.5% |
| Interest Expense | $26.40M$27.00M | −2.2% |
| Net Income | $157.10M$400K | +39175.0% |
| EPS (Basic) | $0.36— | — |
| EPS (Diluted) | $0.35— | — |
| Shares Outstanding (Basic) | 433.60M442.10M | −1.9% |
| Shares Outstanding (Diluted) | 446.30M455.00M | −1.9% |
05—Questions
Frequently Asked Questions
What was the primary driver of TechnipFMC's revenue growth in the first quarter of 2024?
The primary driver of TechnipFMC's revenue growth in the first quarter of 2024 was the strong performance of its Subsea segment. Subsea revenue increased by 25.0% year-over-year, supported by a higher backlog and increased installation activities, sales of subsea production equipment, and supply of flexible pipe in key geographies like Brazil, Guyana, and Angola.
How did the sale of the Measurement Solutions business impact the company's financial results?
The sale of the Measurement Solutions business was a significant event, completed on March 11, 2024, for $186.1 million in cash. This resulted in a gain on disposal of $75.2 million being recognized in the first quarter of 2024, which substantially contributed to the company's net income improvement compared to the prior year.
What is the company's outlook for the energy market and its impact on TechnipFMC?
TechnipFMC anticipates continued resilience and growth in the global energy market, supported by increasing energy demand and a focus on energy security. The company sees a shift in capital flows towards offshore and Middle East markets, and expects new technologies and expanded subsea services to drive innovation and market expansion. They are also committed to the energy transition, with initiatives in greenhouse gas removal, offshore floating renewables, and hydrogen solutions.
How is the company managing its liquidity and capital resources?
TechnipFMC maintains a strong balance sheet and sufficient liquidity. As of March 31, 2024, the company had $696.8 million in cash and cash equivalents and $1,250.0 million of availability under its revolving credit facility, with no letters of credit outstanding. The company continues to focus on maintaining sustainable leverage and generating cash flow for investment and shareholder distributions.
06—Continue