FTI - Earnings call transcript Q1 2021

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Operator

Good day and thank you for standing by. Welcome to the TechnipFMC First Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] I would now like to hand the conference over to your speaker today, Matt Seinsheimer. ahead. go Please

Matt Seinsheimer

good XXXX and welcome TechnipFMC to Good Conference afternoon, Call. Quarter Earnings First morning, and

Our and caution on this our to news be forward-looking call. website. can release any I’d financial statements like made to statements you respect yesterday with during issued found

our regarding by expressed subject cause We Although and assumptions Commission which the those wish only to you materially projected and not implied the that are material most place to publicly any statements, that after described of the caution hereof. or U.S. We new Doug no XX-Q whether could French of TechnipFMC’s on statements. these certain results factors to the and beliefs statements result of to business our with recent to from speak Securities could forward-looking or and to Known Exchange call Chief statements results actual future forward-looking and Officer. the or update are on Executive and differ any cause our undertake risks filings developments as these other recent they in results expectations, our conditions, XX-K, actual Chairman most differ from periodic events current turn a in obligation based I revise reliance our and to future they are undue information, as otherwise. AMF. date Pferdehirt, made, over will date now are forward-looking uncertainties

Doug Pferdehirt

Matt. you, Thank

of that reflected and to results, to than both in from profitable strong industries continued results, be This poised provider for new technology and markets in and quarter leading in performance. as both Surface to the of backdrop real is traditional with strong seasonal uniquely began international improving Subsea, on through development a In was operations the us solid energy that serve. we execution quarter growing with both our revenue, first stronger execution of the services of position even we financial TechnipFMC longer nearly operational market pure-play revenue notable exceptional the achievements particular Our project our had and strong our and segment transition. delivering XX% order operating and despite operations in million. Starting a momentum In from sequentially revenue we U.S., comprise total sequential projects more remain technologies. particularly grew the iEPCI We adoption Free the that an energy opportunities by with for partial million. debt operations severe EBITDA million. sequentially And of X.X billion. the flow and $XXX announced X.X. weather. the operations of by approximately orders with week, execution, Subsea improved In from Integrated Inbound earlier continuing $X.X the billion. strength ended Technip to inbound totaled in and continuing of sale markets. book-to-bill billion, totaled order nearly $X.X doubled we Subsea stake $XXX in U.S. in XX% experienced international Energies Adjusted inbound quarter cash winter $XXX activity. this Technologies, $X.X sequentially orders segments. installation backlog with supported reflecting in the the operational increased and solid growth net of continuing quarter for We driven focused period, represented in reduction material offset

extend to previous to projects the Karish iEPCI the announced two iFEED additional quarter, opportunities. with our and leveraging capabilities our building further our separate with relationship collaborative we upon During development Energean, experience

mechanical offshore the technology on that deepwater and in contract included Subsea technology Voador We Petrobras also the projects replaces X.X traditional manifolds our subsea development, robotic Other manifolds awarded will iEPCI in all-electric fields received hydraulics, execution. period for for utilize project our Malaysia, Limbayong The next-generation first providing thousands an and integrated reduced PETRONAS more as awards subsea and with Brazil. a Marlim is the contract based control the and smaller, for their costly parts, on be footprint. compact analysis while and software carbon of for overall increasing of real-time unit well less the of the performance. data reliability that allows complex a as systems. robotic can availability digital a remotely less upgraded, The automation significantly And use and

remain the suggesting increase to conversations a Client outlook. in activity. constructive, market further Turning

could high-pressure, of to strong supply, Asia oil meeting $X equipment, incentives. well-supported we economic facility on specification are allow include a and to driven where particularly quarter, fiscal higher focused offering. activity our disciplined differentiate These our us local Technologies, greater demand vaccinations intermediate And energy Pacific. technologies Additionally, us and our nearing on that the OPEC+, of and the in capabilities. our unique in the months more into in Sea, local will our Arabia, further are In to well this appear way in Sea continue significant In for capabilities function Middle Surface by North completion a continued and that activity, we and nearly expanded of the geographies. and positions over local price areas driven investment. experience provide whose capabilities, and will in more resilient East, capital supports the Saudi year. our start-up extend than gas by a in in we And high-temperature actions a XXXX confident higher manufacturing opportunities significantly extensive COVID billion orders. remains where these and reopenings three in commitment the just robust external of Kingdom of and believe we leadership economies, stimulus, by the stability price are provide new markets driven Subsea, global and conditions inbound increase spend, realizing that government We continued our to outlook region term. have prices revenue XX% expansion international expand These the North growth constrained segment economic In services strength represented of more

More We of potential expect as project versus continued we from market than combination the awards to that inbound for And market prior more favorable total the of orders specifically, fundamentals. service-related believe represent could as full and differentiated have XX% integrated benefit the direct double our strategy awards our year. well the year.

environmental power, the the for stored sourced continued wind, significant new recovery been value the clearly experienced midpoint, There will development and wind can longer and where We while resource financing. the United new Deep With attracted permits to previous are reasons. projects be and allowing and also providing world’s regard to capital in developments. of in momentum This In The in XX% map, is accelerating meters. what fixed this that waters, It technology. a expand an believe be coming period. project opening that both activity auctioned global order with the for renewable development, auction during transmission, be recent for XXXX, in made We States incremental development for growth North markets, and traditional consistent. estimated for resources, waters project sustainable in cycles, three in for expanding also energy in than the XX offshore in that Sea than sequentially is forward grew an share of energy -- believe wind will has all has recent particular, is of and generation, by we both in offshore increasingly its summary, stronger paid believe the of growth our revenue again XX% licenses we in resources. and investment on will times awarding investment interest see in for energy list wind floating despite potential see the with XX months. energy has at opportunities public of is increasing where increasing which for shifted offshore floating deeper a nearly in part opportunities of scalability leases that potential enabled was winds award decade total auction. energy or our by require for storage more moving we in the more will supported Purple seabed for offshore considerable than attention prices that infrastructure and UK, deeper which first seabed a unveiled And Norway sites areas by has wind goal the previous new more

During wave the generating wind two we on are strategic announced quarter, partnerships, of focused both novel renewable from resources. which energy and

markets new wind to focused First, the owner Scotland renewable a project development a with within partnership on months. project and we holds consider as has will offshore and and already in an Magnora opportunities. commenced strategic Norway, the coming partnership development. The operations sector in pursue energy jointly entering wind position is opportunities announced Magnora in

technologies project wind Additionally, believe and can bring fixed strategic electricity. turbines with to wave TechnipFMC when Bombora’s costs. technology, further wave, Bombora partnership with energy generate and wind to both wave development compared utilizing from into combining power, we higher both proprietary even we to from floating we mWave convert yields By a announced together coupled projects, lowering

we of gives this us to a Remember, tremendous fundamental project right Importantly, at its capabilities differentiate And and subsea selecting not the execution game, the over are steps path address of and renewable that change our the demand partners absolute led are time economics confidence differentiation, increased very to differentiated now obvious transformation improved playbook in long call taking clear, initiated in successful business to were further positioning. we built around the we that to market the delivery, for same approach was marketplace the ourselves high-returns the success sustainable turn will business project extended to playing our will look subsea Alf on and and integration right to the project technological the Integrated create and our benefits utilizing I to future. and be Melin. market the projects. we a and the a our technologies the right iEPCI. focused by

Alf Melin

$XXX cash Backlog and $X.X subsea for Thank beyond $X.X the the was billion. net Total orders is which debt Company million cash quarter billion of scheduled $XXX EBITDA you, revenue $X.X was Inbound stood unchanged at and of Doug. $X.X the and end billion, for adjusted Total with of ended million. sequentially execution billion billion, $X.X was of equivalents of company at largely backlog were $X.X We in quarter billion. the with period. XXXX.

netted that our we operations per book of change to impact to relates for quarter, the of market the an between market value market the quarter-end. credit excluding share of at and value of the the reflects Energies $XXX When loss $X.XX. quarter. Energies. difference and the Technip the continuing other time per the this was gain Income the in charges our at fair value operations adjusted of in recognized which from from change continuing During period in fair related equity million ownership was share separation stake, This per initial remaining primarily to $X.XX value the diluted in after-tax $X.XX, of Technip share a

spin-off in our Technip operations With now the Technip during quarter, the financial statements. partial Energies completed Energies reported financial are results discontinued for as of

For February XX, separation-related XXXX, of the XXXX, of include Energies three months the the ended income March for its on Technip discontinued and operations historical all results incurred results on prior statement to costs XX, transaction. the the spin-off

the Additionally, operations on there end sheet no of discontinued classified or at quarter. assets the as liabilities were the balance

assets investment Energies as of XX, in current reflected now is Our March value market in XXXX. Technip at

in more fourth first segment subsea, turn quarter the a on providing the Now, orders Revenue the the The in mitigated $X.X of improved XXXX results. conversion in mix focus approximately increased driven backlog. basis the XXX quarter customer In sequentially, X%, by geographic by partially to exit due quarter, the in the in segment seasonal services very decline markets. the by Subsea by operational quarter decreased will of let the lower growth the where North and continued adoption I performance from in from the in project from offset decline results. our In EBITDA strong were projects inbound activity. $XXX points primarily the with revenue strong billion offset improvement points lower million quarter, manufacturing offset XX Technologies, billion benefiting Adjusted of start of productivity increased X.X% to $X.X with to adjusted year. decline sequential as us of X% basis cost execution markets, part activity. of our compared margin iComplete XX% EBITDA margin seasonal versus U.S., first sequentially to of in and of international me performance we timing the than ecosystem. due volumes, to activity a fourth further partially in declined America certain declined underperforming Company’s Revenue backlog Surface structure. benefited

million. operations expenditures was from in cash were flow. Capital flow in free million. the of period. resulted Cash to cash $XX $XXX million $XXX Turning continuing This

of $XXX to the shares earlier agreement items During share us related this Energies of reported in our their stake a Bpifrance the million the for result to investment, investment as Neither activities flow Technip purchase refunded free of in revised these our of $XXX as of up cash retained related disposition the level impact Bpifrance million funding Bpifrance to shares to of XXX spin-off. part to provided Energies the acquired Technip quarter, from statement. are as had our flow million we section of cash month. shares previously

items. Turning to corporate

was corporate the $XX expense million in Our period.

million. $XX $X charges Excluding was expense totaling million, the

million experienced a quarter, the During exchange. gain on foreign we $XX

$XX related of a Tax incurred debt at quarter the of the refinancing also the the our the on of loss expense early spin. was to $XX extinguishment million. time debt million structure for We

let you XXXX. Now, guidance on update provide our an me financial with for

strong to reiterate confidence Our guidance. start further year our segment we and gives the full our in year outlook, us

a thus recorded, have the And result reported where and Energies, excludes during the costs operations As Separation-related tax based items a as the which discontinued of we on operations. quarter. and from this anticipated first Technip reported continuing of also in our operations are is removed change is impacts guidance were guidance. discontinued these expenses in as reminder, impact

a the expectations, provision included to now guidance with now million, range to for of costs tax These items free revised the items while to which of operations. excludes incurred approximately statements. financial separation-related stake anticipate our has year $XX lower a in million now quarter, Energies shares million, tax million has separation-related during were in And this Our Technip approximately in our higher expenses are do finally, million. cash announced not sale XX.X we any material out further shares and with to TechnipFMC. Technip of we $XX to separation-related the first calling week, $XX line the of ownership There shares. approximately or of tax of in our outstanding our associated no full excludes XX% million of sale for stake $XX proceeds estimated million $XXX million, share year and approximately which remain range expenses revised is separation-related XX.X tax flow sale of shares. will for Energies’ the the guidance reduce been full $XXX The liability million The ownership our to items but $XXX discontinued of been

call meet second remainder back will leaves guidance. turn for I net the proceeds return Doug our cash a and refund the and over the stated, adjusting As of This clearly this a with and and towards $XXX performance lastly, the quarter will cash-related our equivalents items. closing flexibility, ended we status. our billion. I announced not with that holdings $X.X key approximately will have greater the do the intend sale takeaways while benefit of to of investment-grade cash for in transaction. debt close cash expect our to after first exit over the quarter demonstrating us $XXX previously solid transaction million Free related $XXX to regarding of will commitment block million We in from his and to million, in liquidity manner. was highlighting we flow debt net commitment now financial progress remain to period Technip in by Energies, we million demonstrates And timely the orderly Bpifrance, remarks. to increased our $XXX and to long-term the year shareholder

Doug Pferdehirt

quarter start very our results first strong closing, In our to a support year Alf. with the us provide in XXXX you, commitments. of Thank

order solidify strong Our leadership demonstrates our to inbound position clearly that in continue we energy. conventional

robust expect supported businesses, competitive and market Looking and across ahead, activity fundamentals our by our we differentiation. sustained improving

reduction project our by We partnerships advance is to technologies will efforts. emissions and Magnora accelerate Deep wind to Bombora in through further remain help Strategic greenhouse our such wave committed Purple and a as and delivering work converted To Our this first develop energy world’s the XXXX. gas for hydrogen and core goal, create position we have XX% we Deep development subsea and progressing well. in existing will business. our the And into support successfully our conventional of a new strengths to energy TechnipFMC Arctic, vessel. achieve vessel, novel have an dive continue to the hybrid unique in sources, we as leverage done

will showcase host Analyst priorities for you and open to for now them. Operator, we very announce Day where initiatives scheduled We we that the excited strategic may will the of that are XXth line our an November, support questions. also

Operator

[Operator first question comes Barclays. David Anderson with from Instructions] Your

David Anderson

of Let me big a kind start for you. a with off picture question

I global just trends than you’re probably business the offshore more into insight With think lines anybody. in, about production you have

the soon? having thinking your get really I you’re in drop next, coming it, But, the offshore the on take ‘XX. incremental say, years? I’m shouldn’t projects this Sorry are complete. XXXX, production and we’ve less XXX, peaked you, instance in half rates I global trees Yet but million several with of surprising XXXX, their subsea let’s trees at production get global to staying a for how really of been the barrels kind years over tying years two new see, relive in and to than huge at I decline about opinion, after XXX trouble now. and models, about flat rigs levels five for those only to long-cycle in it’s together, at that floating these start forecast offshore like manifesting production have right rigs X show capacity and mean X% of by

Doug Pferdehirt

say increased you -- Sure. activity... activity, speaking production, said but And of David, in when you’re manifest you

David Anderson

just that showing seeing the in looking yes, the I’m not and not offshore together your of two really you Well, in activity and seeing start the of up numbers, when the production, tying of when it just -- we’re they’re starts I’m at production. kind numbers? kind why and come do just -- down? tying kind of why to And really I’m the really

Doug Pferdehirt

Sure. question, just And your long-cycle of I emphasize are point made because projects. the these in which was that you that

and between increase is in a lag the activity there the production. time So, actual

that if significant market you terms little commercial but will, something but is let’s has look, integrated entity only deepwater where bringing first deepwater. the offshore, break Subsea not into PETRONAS’ of we’re down do This as provide of PETRONAS of iEPCI combined in in they to X.X saw the They award lot project, was kind of in and Obviously, such increase single of unique our So, you experienced Company terms Limbayong This only increase a a Subsea a a market our it if the benefit just award. to or manifested an both our of combination. Company. bit. and was and will. in position, That’s as benefit can an technology, a result the X.X a their project, recent this the both new, that went innovative, something of X.X well model, in iEPCI, iEPCI the activity first

certain let’s of that, the not seeing market is we’re the activity experiencing. So, rest say,

that. and grateful very We’re privileged very for

prepared seeing mentioned of an design. an as then iFEED And we were how level to in front traditional in were iEPCI increase that, addition studies XXXX, -- we engineering In my mentioned and seeing do studies. front-end we’ve again, feed as -- further increased last back in well I of engineering as level work emphasized year, and in XXXX I we that or a increased in see been well, I remarks, studies,

forward the they X XX customer FID upon project move mentioned phase. As what the time, to months, the to at depending can they’re at time and the

just our was seeing -- market, of kind which this the right that for start. give face opportunities why that visibility able to for back XXXX, and we’re to and still market to guidance into indication again, let’s it, guidance now, of there So, terms the proprietary different that’s set the why potential I we orders around gave view time, October but the were year, manifest in us lot of wasn’t time, a is have this was of the completely a XXXX give we strong year, which me, provide the inbound able -- of a at very that still around off at itself we excuse that in it’s inbound of

is So year access could Again, happen. have will, have we it lens you understanding -- have XX% that -- be through of rest don’t awarded slightly at David, our the our I just And inbound you to market. could we’re of to be Company. mentioned, I think to a seeing TechnipFMC I different market significant. quite look this if that you than, a direct the

and a confidence. quarter XXXX, So, David, time, gives XXXX that talked since And in I said industry I at or yes, has far And in this inbound. been anybody as a are it, of we’re it’s the seeing long in about first definitely it’s inbound we looking think, what will, XXXX ahead. my us prepared remarks, you if

Now, on can inbound a projects activity. That global some extension come as but crisis, XXXX in production or further point our inflection see line. as translate those economic obviously, the to will we of happen, barring things then and orders other pandemic

David Anderson

was is out, of impressive next looking from if kind some lot confidence your opportunities kind suited of you question market. We’ve give having at guys. there double-digit for out pushing model the I is, to enough obviously of guess, -- heard kind also that you you’re of to think credit that’s some mean, the back looking the some this And iEPCI quarter. we you. this as of -- get several think you’re margins I it ‘XX. for to And I in there here, out it I’m not maybe so starting of guess even looking on years, of I the kind a obviously, overall do kind do the But the whole kind growth? up, then year-on-year of just we orders ramp this were the think those subsea do positive -- saw perfectly kind this comments service Got but kind back rather enough the bigger near-term If of you business? I’m and think in years talking range XXs, XXs? subsea next guidance, enough before ignoring on XX%ish peak of can that in do to they that’s subsea you of stay And type of get couple where you into level seems of that projects, business that

Doug Pferdehirt

Yes. a obviously strong. provided we margins. Well, our started subsea quarter our subsea guidance was for off this we in Obviously, year, and revenue first good with very very

expect So, you we we we increased to we activity deliver with should well. of that as continue expect, we forward -- as an margin increasing would would move expect, and the that level that

margin right we’re not from So, now, our look your if at guidance you far target.

that’s all. you think an I the expectation think years framed next unrealistic I that that put it, there don’t at think is when target how you for two that out So, three I or

Operator

Your next from Societe Guillaume comes question Delaby with Generale.

Guillaume Delaby

Alf. One for question

us a at three, of partial working would provide should disposal your about one, sense for Can spin-off, say, the how two How us? should Following make guideline, model? you least would capital? or we I maybe which we think

Alf Melin

you Thank for Yes. the question.

that varies. unusual capital, And first we working to inflow we about some think quarter. this some outflow have we’re have obviously, inflow and we not it’s had that quarters first acknowledge when going working some all, of So, capital that that some in

year, to some look for we a we that forecast specifically out confident if we like But of working be we’d the at degree. it are year, capital to the think rest close will nets that in neutral. period the of Over to the

a unusual items forecast point, from capital then, are So, impacts And that working point I will always mean, I advise there and we to with would that starting that. neutral. if beyond start

line look far rest keep when free capital quarter, recognized the end for working in cash the guidance. of you with year up expect more a and our the that is to we this full in favorability the out be year flow So, year, neutral first so we with this for basically

Operator

comes question Marc with Cowen. next from Your Bianchi

Marc Bianchi

mentioned here, you there manufacturing was recovery first helped certainly, then it that some in suspect progress that would Subsea there. you level Doug, performance get in seasonal that a at So, on from or the the improves, strong, stays services. like quarter we And sounded and was and as throughput a similar I

you just based think the that you first, where quarter were in if around margins have in would your understanding, So, that. on that just and be would I any curious second higher the third from commentary biased

Doug Pferdehirt

Marc. Sure,

and As through and know, We is obviously I our you that before, reemphasize to have the through Company. it supply getting think, guidance. chain not seeing went quarter, it’s efficiencies we’ll give solid unique guidance backlog. would quite some with good, obviously even very is I we’re that quarter last annual try terms from maybe in in because XXXX. this We we routine. our mentioned really important there and went But, quarterly into of to thought avoid your I the certain disagree everything we recovery

and improving. margins are Our backlog

not or quantity quality, and it’s quality quantity So, case. our in

that’s is being very we important said, forward. That to a as well as look we business. very, projects type this So, continue -- did

milestones, So, cadence, accelerates but basis. intermittent you because it execution every some milestones. on have performance those when quarter achieve and increased repeat Those necessarily that performance happen or an doesn’t you milestones

as women throughout the this forward move the So, and I pure-play. a as standalone XXXX performing just of and to is caution and work very Company the from a difficult men draw don’t of we doing are to that that want we potential business proud very now well. understand that very, seeing really a the very just straight-line I’m north. have south done But

Marc Bianchi

next I to The question had Deep was Purple. a term longer related and bit

suspect could actual developed of some is what I’m on you you this be being stage and sort Deep project? at that. And versus out than that’s comment on the Purple technology Magnora, that my of if with And perhaps of developers then why perhaps Magnora there. tangible more a technology could it’s also, agreement have there? mentioned concept offshore on sort towards And other that disagree You development. your you’d understanding with of curious technology I

Doug Pferdehirt

Sure. Two great questions.

that support Bear that not if we’re have but disagree very it’s mind also corrosive it’s a On that the of to about yes, with point technology do will, of point a we from a to secondly, handle, -- you view. stability to difficult first, I is both concept. in unique And a substance, it. view, I’m you. Certainly, going talking from

a a it ago, but technology marketing this where able capabilities, process. process, four Yes, surfaces, years be qualifying you’re Marc. development know something for the you’re very particularly have tremendous and, that substance, only we start very, containment, we’ve particularly didn’t also because well, called with years, actually challenging going into a before amount well TRL ceiling years four And their has real the started was to for in qualifying not to us hydrogen, where as of products, will, et We important things. on ago been about talking cetera, technology over do we that that’s there’s but it which concept it we operate like to is about a been talk So, to long a It’s you subsea. challenging which to environment, this. been if develop four your

showcase because will November opportunity you’ll kind you’ll in opportunity of we here, little allow portion that technology, big the if will our that hope Day. Day out that really participate give to -- and marketing of Analyst Analyst us to me a in a throw So, that’s be the

right relationships. into well. us, we’re to We very phases well you Purple pleased we multiple basis to would where collaborate with felt progressing That’s we does. that but an thank build our we’re it’s together, and Look, well I’ll And project. on intimate XX for traditional We asking. now, partner same new move on that leave -- as business, well work work finding Magnora. together. relationship for for for client years can it deep, the clients was the energies. where what Magnora, in is So, Company with the XX, We our do Deep into the quite we expect exclusive

just other into have of time building a in That likely we said, well. are So, a to in lot we being spend partners wind offshore before relationship that jumping as partnership.

opportunity multiple good and business, this that the but set won’t at mean very in traditional that have like it we’re there right just was be time we be work a So, with, proud partners, multiple felt we partner to with and partners where part to Magnora other doesn’t our relationships. of

Operator

UBS. Wong question next comes from Amy Your with

Amy Wong

questions of couple A me. from

of is, backlog. inbound notable for into the have this is converting question in decent subsea quarter kind think I points of your execution. to first increase data of one seems a pretty The XXXX had It

with? Maybe So, yes, of a usual? that if of demand out timeframe like projects trend that kind a the a And inbound is pent-up bit slightly mean call are fair of shorter any moving in than seems to is in types there’s of converting the clients to your there forward to observation? terms revenue is

Alf Melin

can that I here. one. take Alf is This

case, quarter, every this, this say in some And you scheduling. absolutely are demand accelerated right in some Let’s there that backlog is in is the movement our there execution.

revenue that. guidance more to year now of able that end So, driving terms for our a high range Subsea. revenue guidance towards is trend on in look our overall full bit we to at us the the capitalize for the are little And in of

picture. a So, overall, that’s positive

Doug Pferdehirt

to I’ll afternoon. Amy, good add that. And

were iEPCI was brownfield is right to X.X Subsea -- as In installed opportunities, project thing -- utilization Clearly, will, client other clients and in any just offshore their at of tiebacks there mix the doing optimizing or you asking, you change move the words, it’s mean, I right time. if infrastructure, terms mix? of more the or the the and, more

see take could years of So, working of XX-month a our to solution in we XXXX, all can and of the conversion all of additional were closely on ability deliver -- different study greater commission between a all their working And what subsea the acceleration working very it mix we had pandemic, a programs really now We the where seabed. and in to been we’ve of the to part or with multiple were companies if in the tied oil those installed their through will, potentially almost potentially reality almost out project all the quicker backlog. -- already months projects able in will go to to major for type during our be market them, as installed underway ways, we’ve some we unique the the and XX drive, conventional competition. that with a oil profitability or that demonstrated and players, the to in major of resource you this that bring been, our because We’ve as we inbound deliver half revenue time seabed commission be or Company. of have own discussion. infrastructure, that another part the back of And on

Amy Wong

you. Got

second relates to in an Day your Analyst question announcement My just Okay. November. host to

guys to slightly you we is expect in the -- more just strategic posted November, just or far of are FTI you is long branch a update the And this energy. understand technology? review -- off some should on quite wanted a focused of spinning put differently just strategy? characterizing Are more away, kind looking way rather Now, a but pursuing big bit at only or

Doug Pferdehirt

demand under busy Well, potentially Amy, as having hugely we saying conferences and a Markets know by me in of Analyst of that Capital both let is you year, start well Days as of people other terms the are high and Days. a time in terms or all popular,

we your to hope calendar that join on just early, certainly get be able wanted we us. to you’ll So, and

as should we’ll structure, the sure, that of as terms be talking well In you strategy technology. expect

a that company We’re change. drives

innovation. company of a We’re

but I what think the surprise upside not against and we state. continue surprise to deliver to the to only we upside

able will time be and certainly a think you’ll spent, to it us. we’re we We hope join that excited for be So, it. well

Operator

O’Leary George comes TPH Your & from with Company. next question

George O’Leary

kind Free you and low what could low that end end drives cash end I increase if range. the just flow of high was the the guidance frame end, to high was of nice very or see. wondering the

Alf Melin

Sure.

in -- capital all, are increased. to if clear flow So, that was assumed working my -- this our quarter. expenses were previously around honest, And we you’re But had now free as in result overall, in will our first of be timing. the separation-related direct are is be guidance -- we mostly in first discontinued the very continuing would recorded operations cash we that in trying variations operations the of a I prepared if I’m be is remarks, there honest,

around we risk can working So, part, most year, capital deliver confident the such there. Can Yes, flow, though cash is a other some even manage of neutral pieces are for the we as free for that in still the of we remainder the possibly. there capital expenditures?

that. some are in there dynamics So,

obviously potential even our drive in some guidance far in can Surface degree, here and the of our Subsea favorability. of the some that We’re in in terms demonstrating revenue margin so to potential some belief

overall, free our favorably year forecast looking ability flow to. So, deliver we’re guided to at as the full cash have we

George O’Leary

the respect transition right. then, question energy All equation. renewables side just picture helpful. to of Very or And a the bigger with

curious of Just glide portion whether are then, maybe all pathway side of, And path the frame of on any composition? it’s the nearest-term a what’s solar, becoming path comprised floating or business you and that wind, revenue? the plus if material Just wave could opportunities color offshore to tidal three? wind, the the glide

Doug Pferdehirt

spoke that because really alluded or Yes. to we’ll about George, it’s lot it a One, November one one very but certainly at a Analyst to really, and in little bit. our just talking more of to -- that I good in foreshadow Day, question, I prepared spend remarks on the think we critical. be we a time

and again, That’s the wind, new comprise will particularly offshore pillars. total we wind. that offshore wind. And floating foremost, our believe four is First energy strategy of around XX%

the by turbine and fragmented. not is little There very fixed turbine wind. -- we’re very really provided chasing the manufacturer. there the other no It’s technology integration So, than is

right? get using So, to renewables just to boat for chase just revenue, I’m that and my I’m anything, doing a not vessel application. different new that call utilization energy short-term to or really

that So, we’re not looking at it way.

the can to energy, technology integrated and in we a from Company -- just from bring what what an it We’re looking bring we our at can differentiate as like conventional offering. we do

So, We to you a just market a allow shareholders available fixed type -- the us we’ll will generate -- our selling acceptable the if be that believe of at wind rate differently. would I’m in, to this renewables is in returns fixed sorry, day market and to approach very it lower versus will, you vessel what today.

in success us that’s thing, our we what differentiating have today. about that’s didn’t game. were we’re remember, we’re believe, business available said and was going our and the seeing were deliver to the just iEPCI to the or what work, that’s success -- and ‘XX, back we if our to you capacity we mean and We those floating activity. and going same very-disciplined, today. iEPCI, we in traditional assets of to long So, And ‘XX we chase why projects, We having playing did ‘XX

output together, as to in We very we’ve going wind. and the -- can That’s thing you the focus believe same wave, technology wind the put wind wave we’re if technology In the you put doing if we’re of increase So, it’s much with XX%. and wind. we demonstrated, clear, on the integration as by we believe significant.

the be Purple our offshore addition that, Deep to convert to be ability critical. In will project. and/or That’s store to able

energy be offshore distribute could be We to offshore. forms other could transfer storing storage, everything the then do near-shore that in to ability and hydrogen having be able to -- we do we potentially storing a to versus well converting of So, type generating hydrogen. and power of at this wind could and as wave port,

then, levels to that and covers addition wave, difficult you transportation be be in And kind carbon, that it required on I we that would I’m find storage. sorry, hydrogen. the which sequestering So, -- support believe will that, wind, to all that will get be land. of to storing you carbon to carbon that

sequestration So, near therefore, a coast. lot of will happen the the

carbon -- transport store very that technology or will. are that this announcing safely come We to will -- the more novel be on and you subject, there’ll we offshore, be is we COX us subsea that will allow will and sequestered again, if to

the will three as mutually sitting exclusive. of that’s of not world So, today. in our integrate Bear They’re to sea is as kind we our There’s on try mind, pillars. the those go infrastructure possible. floor about ours, of together mentality. way it. XX% the perspective, That’s we many From subsea those

we’ll Marc talking earlier when this Our very about the It that technology, technologies sophisticated using be application. injection we ability just in to able Deep as different some it’s I a distribution storage technology about equipment, very -- announce equipment, very that isn’t be unique Purple talked of as potentially answering coming question type we to and or that was hubs hubs, could quarters. the the new will as some require same use to be hubs

and all So, roadmap that of us. together, you exciting it’s for a put very

business. okay, how crossover? that growing? growth Now, I not question mean, when? got For done is, to is Well, the potentially the beyond. now potential one When going And your grow potential? The is growing, a we as do just and conventional is obvious. the is think does now. the as it? our this big see I question through conventional XXXX how right is the is, specifically other is we and saying and for business big potential do -- see when We they go long while just to past XXXX there I’m

A positioned kind want maybe So, the combination. just and of it things before I of which the help can the gets to know. be be with existing that. to going do renewables we maybe well are track just with versus our one drive, hydrogen, be the ahead of returns and other. whatever company that, as generate starting to renewable to growth will offshore that as off see the high conventional We assets local in from some It’s in other support. subsea But well-positioned happens has utilization sustainable takes happens wind for for carbon offshore revenue we’re to again, with lot a today Legislation, don’t to we’ll today. hydrocarbon renewables. company, revenue that our And one benefit chasing first,

Operator

Alsford Citigroup. comes with Michael next question from Your

Michael Alsford

I’ve got a please. couple,

Firstly, areas, driving if across But, significant following job through the any efficiency business. great where you lead could guess you’ve separation, the costs ability a there Doug, to see just I the off, organization? reduce greater done are further I

Doug Pferdehirt

pursuit organization, enough operating team, this in just word is as organization. know, in segments and improvement, across our operational can’t the and for I a this simplicity. Well, Michael, chain leadership The organization our as we supply management use as relentless manufacturing there’s throughout you and well of about the the say engineering,

driving and be complexity. -- And the remove company a play of pure do. remove as to that we through Obviously, Let’s benefited the complexity that standalone we focused. really that everything that now from we’re some

I’m assured, you Michael, employees removing we’re rest looking massive cost single to by environment But, complexity every not and which our program should a like or day, that. to efficient, creates, the way, for more big by a make reduction going the announce So, something work organization better costs.

Michael Alsford

quarter And flow payments good follow-up the such just I’m milestone result, there is a quarter? just help of flow the drive provisions or any it is specific quick wondering free just cash as tax on inflows contracts cash flow. rebates the the within during the or unwinding on so that Thanks. simply

Alf Melin

Yes.

first So, you’re impact here? talking quarter the about

Michael Alsford

Exactly, yes. flow I helped whether that was working just wondering drive anything free that cash capital quarterly inflow there’s higher? specific in

Alf Melin

Yes.

that in Yes. that settlement quarter. were as overall, some But cash went the a for question. flow the the benefited negative some did well. beneficial. first have other the was quarter into quarter. There settlement free had We items for the that items We first thanks So,

Michael Alsford

just roughly how And much that? was

Doug Pferdehirt

come things -- out of But, that This to and flow. from what’s our let in all Yes. Michael, add just and these always contributed flow. other that. me there’s of cash was the operations, -- cash forecasted there’s always were there’s part

the ordinary cash the nothing or positive created just So on flow good, the that momentum, unexpected out of solid execution side.

Operator

for Syed Waqar from Your comes Markets. next question ATB Capital

Waqar Syed

questions. my Two taking for Thanks questions.

made that of you’ve and and we’ve more industry rationalization you that lot a a growth be a average right base. to the And activity need people for employee able of lot you a people trained. that that offshore. of the see growth in multiyear could of you have Subsea Do efficiently number sophisticated is be manage the kind up-cycle? right one, kind And long-term seen First of a employee the sustainable, comment to

Doug Pferdehirt

What that and clear, inspiring. Look, biases. And is Waqar. have is we and just bias. year very mean believe you, heart. a conscious people. short demonstrated unconscious the they nothing consistent of a this during delivered I on last have Thank the all I have conscious what my There’s best they we to I’m biases. going from be have basis, particularly

had to talent look, made progress and to we their protect provide development the we and So, everything have the to only we were make Company. can organization, within opportunities to protect, in them adjustments the we not adjustments further as -- but to unfortunate, career our continue and to for we’ve done

very more contractor. one supply two The sometimes point a or customer codependent you be a customers. you case, a would though. are sometimes we that find chain, In companies companies you the versus raise smaller further this on find You valid and go into

And also closely around as And our did for we we work with our customers work so, key just suppliers. shifted us. very

said and they the year customers last it and sure because from our year. to Some we that when work done, would wanted they that all us it the make was with of to and us they help volume took knew had difficult down said they who competition wanted gave to through sat and work a

protect make in to the as wide So, for efficient do same eyes roofline to open, to and cycle X.X terms of assets of prepared way -- in we business. particularly the with work assets, well protect, do will, that did workforce human But our we our growth our as being best plug, our does in business motivate and the create you we’ve a said, and manufacturing Subsea I that only and if is sure is required. way doing we’re put suppliers. to terms deliver. but the done more of iEPCI in not points. a well individuals we will to That much as pinch a go any lot

upturn. just an not it’s So,

this going upturn We’re very into different.

next-generation represents, We’re now of that total of our going work portion significant I equipment as in with subsea the now. said, a

that points for, wide are and definitely, the that different growth as believe for will acknowledge we eyes be we there Waqar, pinch prepared it’s continues. open us very but most a So, recovery well

Waqar Syed

And I Dough. another if Thanks, may question. in squeeze

and before Energies Before but would help just and had with of following -- happened, set customers and assumptions FTI. it Technip separation, how your you about a change how the investors interaction of with interaction, you the separation employees the their behavior not and

how your to going compared set the being separation? happened, is has separation the into of the reality assumptions Now,

Doug Pferdehirt

to relationships? In customer relations, customer regard

Waqar Syed

better. kind there was Energies either for for are -- all you and kind that? -- customers, some a revenue, three uptick and yes, I starting -- Technip some of That’s maybe of could get investors seeing with will if you in following you separation, are be employees that a kind of you that or had of customers, Maybe view

Doug Pferdehirt

we Waqar, clear, won’t and differently so pure very many it’s stronger given, have with very That’s work two only over trust in based a not upon earned they the a transparency. HoldCo with because and had supply different two others chain. that’s -- approaches. their different play models time, of and ago, And the back obviously performance -- as very contractual customers. Yes. than with deep through I is to What’s of have kind us intimate our honored of that alluded -- I go relationships -- just They it. with have minute to a work customers our that we the we’re many But -- you

this, not even new and allows year, many that believe do -- the of it’s So, increase our from be relationships you to And new I the announcing past new if over that -- will, I are -- what Company. it’s in we’ll announced several most that. And benefiting relationships just we which are believe, exclusive intimacy. year, we’ve this

spend terms more an focused, obviously more time, be the have now more of visible. be we In to employees, opportunity

and the were organization, in shareholders, of independent thing think attention, the can bigger spread focus that required of projects equitably past doing across do. hope is in an to I we we which an right And company. of we and that management I enormous in Some demonstrated bandwidth, the now QX, value of more amount the the terms

Operator

comes with Kepler Bertrand Chevreaux. last And our Hodee question from

Bertrand Hodee

backlog update substantial Back question. us from you the Mozambique. majeure? One especially give Mozambique LNG. Do impact? on contract? Yes. following or you you force this is what any the you the Can share for obviously of in left if any can Thank see in taking color And subsidies direct $X.X XXXX, a won contract, my billion, for an you

Doug Pferdehirt

think much want to the important. question, very I you because written that it’s things Thank incorrect. for some been that clarify have Bertrand. were And I Sure, the of

would announced a as substantial period. be plus recognition, that, project or $X So, bear typical the meaning revenue mind recognized of we minus a this size -- yes, a over in that billion. award, plus The would five-year

a to assuming or the do can an math, plus only of was Total will will, a linear. you but have is of kind linear, ours. partner serious right get discussions Total you if of now, it impact, It’s serious idea of are not annual Total. you minus. with is you we very kind beginning I can customer. So, the tell

deepest making Total. have we for personnel, fact We based health is And deeply and their of and Total security the including wellbeing respect their and the the that us, upon decisions respect. contractors’ personnel

Second point, this -- we company. an offshore are

is offshore. scope Our

We have this at manufacturing. doing we’re that is the All the no exposure. in-country work point

equipment. into manufacturing well the are We the subsea of

some that go to So, on will time. continue for

tens And progressing way are thousand it’s on quite a done yes, done -- long everything -- well well. haven’t calculation. the I of of XXX, being Mozambique, and from schedule, going thousands -- on We plan, -- is thousands

So, you -- yes, any onshore infrastructure, just realize, not doing any if will. not we’re doing we’re

well, as And right being now the their work confident which with away. said, move being wants the That that. Total’s we is away, manufacturing doing best sure, that position is I’m forward. very to Total, We’re offshore to an we’re and continue we’re Total we the going phase, that respect our on very, closely we’ll work and for and people on progressing we’re deeply It’s to in to contractors. do this, work to continue And company. far done for

in of many was occur or projects. profit An make If both something not me but on am I or our be would EBITDA clear, the next point. very by the that year, range. this revise guidance, that this project, lead Let to from What sure to very I’m terms important or to emphasizing us have project just impact guidance clear we it revenue our many, that? on the revenue

diversified. company, very global We’re company, we’re we’re and a well large a

there an impact, that we’re in-country, to to -- working the doing it us lead So, But, And we concern if, not security discussions. is XXXX. if, issues be revise are our the there it’s work and we are not again, no repeating, working should in issues repeat this the potential guidance that closely, I exposed are because would very if, very and early for outside. about if and

think, I I I XXXX. XXXX, excuse me. said meant

Bertrand Hodee

Crystal Okay. Doug. clear,

offshore the of we in of installation is in the campaign only terms schedule can a delay the contract? risk see summarize, to So

Doug Pferdehirt

again, exists. -- at this potential no That given But no there’s Yes. been we’ve time. been made decision

working We’re with Total. closely

Bertrand Hodee

you I’ll U.S. squeeze after, us another I of of Can say, the would you project, of still see say, in package give do I what a Mexico would one, Do you traction? traction less region? another see you Biden? activity region. -- Joe see you Gulf see a into and the Do election do terms in feel see iFEED, you this of in of

Doug Pferdehirt

rough globally average today. that operator-owned market offshore nameplate markets, not a subsea. amount in is at operating is infrastructure, There’s for mature -- of XX% Like Yes. only figure capacity. about infrastructure capacity infrastructure significant Kind mature being many at the Gulf of most very operating a of Mexico on is a of globally

to additional in therefore, significant capital increase any hydrocarbon there’s bring to an facility costs be in of into processed that So, without opportunity terms infrastructure.

hence, brownfield So, tieback opportunities.

As Amy, in positioned. Coast, uniquely operators Gulf many We’ve working talking to idea. the I was we’re been same with

Let’s what be potentially other back. you look have around your you at have could what leases your leases infrastructure, infrastructure, around, what assets tied

radius times technologies X electric increase trace new tieback the us X greater. pipe that significantly up a allows included and there have pipe heated to out pipe by times, to We

drawn the infrastructure now is the is times radius So, two X ago larger. that years around the circle would just have you

subsea well to going drive be do. as that of of lot to there’s we’re processing business so, subsea And our a It in things will boosting. terms able

opportunities exciting us. yes, the new surprised as hub Gulf Gulf it’s see Mexico, be on. year greenfield lots announced the for project, a there’s And well. this potentially activity of greenfield not Mexico being going to also of I So, of would in a

Operator

over to like now would the I turn call Matt to Seinsheimer. you. back Thank

Matt Seinsheimer

first of website beginning Time today. our British our conference Summer at replay call. on This X:XX be p.m. will quarter available approximately concludes call the A

you the any you please now the feel for contact you call. to joining Investor If have Operator, end further questions, team. free Relations may Thank us.

Operator

call. conference you today’s Thank for This participating. concludes

disconnect. now may You

TechnipFMC (FTI) 28 Apr 212021 Q1 Earnings call transcript