Investor Relations Overview
March 2024
Disclaimer
Forward-looking statements
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. Forward-looking statements usually relate to future events, market growth and recovery, growth of our new energy business, and anticipated revenues, earnings, cash flows, or other aspects of our operations or operating results. Forward-looking statements are often identified by words such as "guidance," "confident," "believe," "expect," "anticipate," "plan," "intend," "foresee," "should," "would," "could," "may," "will," "likely," "predicated," "estimate," "outlook" and similar expressions, including the negative thereof. The absence of these words, however, does not mean that the statements are not forward-looking. These forward-looking statements are based on our current expectations, beliefs, and assumptions concerning future developments and business conditions and their potential effect on us. While management believes these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate. All of our forward-looking statements involve risks and uncertainties (some of which are significant or beyond our control) and assumptions that could cause actual results to differ materially from our historical experience and our present expectations or projections. Known material factors that could cause actual results to differ materially from those contemplated in the forward-looking statements include our ability to close the Measurement Solutions transaction, on a timely basis, if at all and the risks associated therewith; unpredictable trends in the demand for and price of oil and natural gas; competition and unanticipated changes relating to competitive factors in our industry, including ongoing industry consolidation; our inability to develop, implement and protect new technologies and services and intellectual property related thereto, including new technologies and services for our new energy business; the cumulative loss of major contracts, customers or alliances and unfavorable credit and commercial terms of certain contracts; disruptions in the political, regulatory, economic and social conditions of the countries in which we conduct business; the refusal of DTC to act as depository and clearing agency for our shares; the impact of our existing and future indebtedness and the restrictions on our operations by terms of the agreements governing our existing indebtedness; the risks caused by our acquisition and divestiture activities; additional costs or risks from increasing scrutiny and expectations regarding ESG matters; uncertainties related to our investments in new energy business; the risks caused by fixed-price contracts; our failure to timely deliver our backlog; our reliance on subcontractors, suppliers and our joint venture partners; a failure or breach of our IT infrastructure or that of our subcontractors, suppliers or joint venture partners, including as a result of cyber-attacks; risks of pirates and maritime conflicts endangering our maritime employees and assets; any delays and cost overruns of new capital asset construction projects for vessels and manufacturing facilities; potential liabilities inherent in the industries in which we operate or have operated; our failure to comply with existing and future laws and regulations, including those related to environmental protection, climate change, health and safety, labor and employment, import/export controls, currency exchange, bribery and corruption, taxation, privacy, data protection and data security; the additional restrictions on dividend payouts or share repurchases as an English public limited company; uninsured claims and litigation against us; tax laws, treaties and regulations and any unfavorable findings by relevant tax authorities; potential departure of our key managers and employees; adverse seasonal weather, and other climatic conditions and unfavorable currency exchange rates; risk in connection with our defined benefit pension plan commitments; our inability to obtain sufficient bonding capacity for certain contracts, as well as those set forth in Part I, Item 1A, "Risk Factors" of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and our other reports subsequently filed with the Securities and Exchange Commission.
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.
Investor Relations Overview | 2
Contents
- Operational and financial highlights
- Company overview
Investor Relations Overview | 3
Section 1:
Operational and financial highlights
Investor Relations Overview | 4
Q4 2023 Operational summary
Highlights
- Subsea inbound of $1.3 billion; full-year orders of $9.7 billion driven by record level of iEPCI™ awards
- Subsea ending backlog of $12.2 billion; highest level since creation of TechnipFMC
- Sequential revenue growth in Subsea Services; asset maintenance and ROV services offset typical seasonality
- Surface Technologies sequential revenue growth driven by international and NAM markets, both benefiting from higher wellhead equipment sales
Takeaways
Direct awards, iEPCI™ and services exceeded 70% of Subsea orders in 2023
Adjusted EBITDA1 guidance
~$1.25 billion in 2024;
increase of 33% versus 2023
Subsea inbound expectations increased to $30 billion over the three-year period ending 2025
1Total Company, assuming midpoint of guidance range for Subsea, | Investor Relations Overview | 5 |
Surface Technologies and corporate expense; excludes foreign exchange | |
Q4 2023 Financial results
Sequential highlights
- Total Company adjusted EBITDA of $245 million, excluding foreign exchange:
- Subsea declined due to seasonal impact on vessel-based project activity and mix of projects executed from backlog
- Surface Technologies benefited from increased contribution from international services and higher wellhead sales
- Cash provided by operating activities of $701 million, free cash flow of $630 million
- Cash and cash equivalents of $952 million; net debt reduced $534 million to $116 million
- Total shareholder distributions of $77 million through share repurchases and dividends
Segment results
$1.5B
Inbound orders
$13.2B
Backlog
$245M
Adjusted EBITDA
excluding F/X
$630M
Free cash flow
Subsea | 4Q23 | 3Q23 | 4Q22 | QoQ | YoY | ||
Revenue | 1,720 | 1,708 | 1,343 | 1% | 28% | ||
Adjusted EBITDA | 225 | 258 | 140 | -13% | 61% | ||
Adjusted EBITDA margin | 13.1% | 15.1% | 10.4% | -200 bps | 270 bps | ||
Inbound orders | 1,270 | 1,828 | 1,516 | -31% | -16% | ||
Backlog | 12,164 | 12,074 | 8,132 | 1% | 50% |
Surface Technologies | 4Q23 | 3Q23 | 4Q22 | QoQ | YoY | |
Revenue | 357 | 349 | 352 | 2% | 2% | |
Adjusted EBITDA | 52 | 50 | 44 | 5% | 18% | |
Adjusted EBITDA margin | 14.7% | 14.3% | 12.6% | 40 bps | 210 bps | |
Inbound orders | 262 | 317 | 327 | -18% | -20% | |
Backlog | 1,067 | 1,157 | 1,222 | -8% | -13% |
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Subsea opportunities in the next 24 months1
BP
Kaskida
BP
Tiber
SHELL
Leopard
WOODSIDE
Trion
REPSOL
Block 29 (Polok and Chinwol)
PETROBRAS Sergipe Deep Water
PETROBRAS
Buzios 9
PETROBRAS
Buzios 10
PETROBRAS
Buzios 11
EXXONMOBIL Whiptail
EXXONMOBIL
Guyana Ph 7 (Longtail)
TOTALENERGIES
Block 58
PETROBRAS
Atapu 2
SHELL
Gato Do Mato
EQUINOR
Fram Sør
EQUINOR
Johan Sverdrup Ph 3
CHEVRON
Aphrodite
ENERGEAN
Katlan (Olympus)
MELLITAH | ONGC | |||||
Bahr Essalam | ||||||
KG-DWN-98/2 Cluster 3 | ||||||
SHELL | TOTALENERGIES | |||||
Bonga SW | ACCE | |||||
SHELL | TOTALENERGIES | |||||
Bonga North | Cameia | |||||
ENI | ENI | |||||
Baleine Ph 3 | Coral North | |||||
TOTALENERGIES | ||||||
Preowei |
ENI
Gendalo / Gandang
ENI
Maha
PETRONAS
Kelidang
PETRONAS
Bestari
WOODSIDE
Browse Phase 1
ENI
Verus
$250M to $500M $500M to $1,000M above $1,000M
1 February 2024 update; project value ranges reflect potential subsea scope
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2024 Full-year financial guidance1 As of February 22, 2024
Subsea
- Revenue in a range of $7.2 - 7.6 billion
- Adjusted EBITDA margin in a range of 15.5 - 16.5%
Surface Technologies
- Revenue in a range of $1.2 - 1.35 billion
- Adjusted EBITDA margin in a range of 13 - 15%
- Includes anticipated financial results for the Measurement Solutions business for three months ending March 31, 2024
- Corporate expense, net $115 - 125 million (includes depreciation and amortization of ~$3 million; excludes charges and credits)
- Net interest expense $70 - 80 million
- Tax provision, as reported $280 - 290 million
- Capital expenditures approximately $275 million
- Free cash flow2 $350 - 500 million (includes payment for legal settlement of ~$170 million)
1Our guidance measures of adjusted EBITDA margin, free cash flow and adjusted corporate expense, net 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.
2Free cash flow is calculated as cash flow from operations less capital expenditures.
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Q4 2023 Cash flow and net debt
Free cash flow | |
(in $ millions) | $630M |
(72) | |
(303) | |
701 | |
(77) | 11 |
952 | |
691 |
Cash and cash | Cash flow | Capital | Debt reduction | Shareholder | All other | Cash and cash |
equivalents at | from operating | expenditures | distributions | equivalents at | ||
Sep 30, 2023 | activities | Dec 31, 2023 |
Net Debt
(In millions, unaudited)
December 31, | |||
2023 | |||
Cash and cash equivalents | $ | 952 | |
Short-term debt and current portion | |||
of long-term debt | (154) | ||
Long-term debt, less current portion | (913) | ||
Net debt | $ | (116) | |
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Backlog scheduling provides visibility
Subsea1
as of December 31, 2023
2026+
$3.9B2024
$12.2 $4.8B
billion
2025
$3.4B
1 Backlog does not capture all revenue potential for Subsea Services
Surface Technologies
as of December 31, 2023
2024
2025+ $1.1 $484M
$583M billion
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TechnipFMC plc published this content on 04 March 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 March 2024 21:54:04 UTC.