FTI - Earnings call 3 2023

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Operator

Thank you for holding, and welcome everyone to the TechnipFMC Third Quarter 2023 Earnings Conference Call. [Operator Instructions] I will now turn the call over to Matt Seinsheimer, Senior Vice President, Investor Relations and Corporate Development. Mr. Seinsheimer, please go ahead.

Matt Seinsheimer

Thank you, Jack. afternoon, Call. to good XXXX Third and Conference Earnings morning and TechnipFMC's welcome Quarter Good

release financial news on Our and our be today website. found can statements issued earlier

statements with I'd caution respect made during to like this you any to call. forward-looking

are by differ on in uncertainties Although current statements. Known results hereof. recent to and any forward-looking our actual that these differ place and conditions, described filings could expectations, developments or to and from date subject in speak other to which and to our they statements, these cause We most future our with most are to are that regarding materially as certain projected caution factors beliefs expressed could XX-K, Commission. statements reliance business forward-looking U.S. actual implied of not from the based Securities results those Exchange undue recent assumptions on periodic only the risks material results our XX-Q wish and you cause

no a We will over as our date whether made, obligation any turn information, I Pferdehirt, events call Douglas they and Chair now Officer. TechnipFMC's Executive are or after of the or forward-looking future otherwise. statements revise of to the undertake Chief new result publicly update to

Douglas Pferdehirt

Matt. today's morning you earnings Thank Thank you, in Good and call. participating for afternoon. good

Surface expectations billion, higher. We quarter also driving the delivered exceeding second $X.X improved year momentum came for adjusted is and solid on Subsea Technologies full results at results provided in strong EBITDA and the for third This orders quarter. Subsea our guidance in inbound call. our sequentially we both

million, XX.X% an Adjusted quarter. foreign the impacts. when EBITDA adjusted highlights EBITDA Continuing was with company financial of Revenue was total $X.X exchange excluding margin billion. with $XXX in

included Subsea, ever our billion. company Woodside's These in Total ended flexibles In in award the period Gulf the pre-salt Brazil was orders project. inbound $X.X for and from largest of at in received fields the for significant for $XX.X period. pipe an Mexico Petrobras billion. company we flexible the Total backlog contract Trion

market with technology, leader for and end-to-end capability As us Subsea of both to pipe provides flexible clients. unique this our pioneer design fully systems integrated a

unique architecture. greatly a integrated in We driving improving our enables to economics technology further offering field project simplifies the ability greater into integrate differentiation which This cycle iEPCI reduction our offering. have time, flexible and in

Beyond of unannounced awards in flexibles' exceptionally to level quarter, ongoing activity, the market. which we experienced also of strength high an the the speaks project

by and Subsea services, activities. robust, driven field of In inbound life installation was

Subsea will Given billion. the for believe in to quarters orders the continued strength we XXXX, for billion if will approach extend X we next exceed the current full $X our year. include now confident that And we view are inbound, expectations our $XX the

near-term of and inbound quarter earnings update, will on this of a has diverse as in durability both cycle of doubled an we is XXXX, cycle nearly for extended update this an growing the The versus this provide now through to prior well call. With driven Subsea customer $XX base. billion basins, which the expansion exceed on expect as guidance more the active and number outlook by we our fourth

Additionally, awards nearly this number increased robust XX% studies when FEED to cycle year. quarter, third and of was FEED supported the activity. In half strengthening the of pipeline the the by compared of first a in

awarded XXXX the half FID. of have be potential than project more to in studies upon awarded direct Importantly, to our the company

to that extended are beyond will consider likely that us visibility and present new frontiers even the resilient Subsea XXXX, with second half This in the themselves before provides of we opportunities decade. confidence remain

is Equinor's proportion awards, coming increase other Subsea XX% high reflecting of BM-C-XX High Brazil, project of Sea. contracts, backlog have ended been we the the and Year-to-date, BP's project in billion, Subsea Rosebank book. North order $XX.X project the of year-over-year. direct the quality this U.K. Ocera largest the in integrated X.X period our backlog increasing in awarded X the iEPCI, nearly from Aker a An and industry's

execution scope these significant with beyond as revenues us portion provide certainly and the the extend of of integrated cycle visibility multiyear size times, awards will While project a shorten XXXX.

international sequentially. In Surface Technologies, activity increased

continue as North production framework in in ramp America the Oil our lower with on moderately Abu was We Dhabi our Activity agreement to period. as Saudi up execute in National successfully facility, Arabia well multiyear Company.

to However, operating margin strategic benefiting reduce our sequentially, structure. taken the actions cost improved from previously

commercial will half year closing, second should and full success financial Alf operational results continues results, our our higher. to drive drive strength how and the In discuss in improved the

the inbound, our revisions further now current financial I are years awards are the ahead. more expected sustainable results. segment discuss order Alf these year. And to results Additionally, services to turn of the and strengthening Subsea iEPCI, for the call the higher importantly, XX% our to driven over are outlook and Subsea than in in more and represent which performance high-quality upward by to foundation more direct fueled by now orders will other

Alf Melin

from was billion in excluding the Inbound million Doug. Subsea. which $XXX billion, $X.X was Thanks, quarter when the totaling charges $X million. foreign loss restructuring exchange totaled other and in came $XX Revenue $X.X of million and of quarter $X.X impairment billion. EBITDA

The growth delivered the billion, and was in Brazil. In we from quarter. revenue $X.X up and drivers projects the in by solid increase second mid-single digit driven X% Subsea, both Norway improvement largest were services. results. of Operationally, The was revenue

with Results basis million, quarter. $XXX points XX.X%, the higher of favorable from margin was volume up second a mix. primarily XX from and activity benefited EBITDA Adjusted

primarily up a the which the XX.X%, XXX was a partially offset from in unchanged improved versus part versus in X% North basis sequentially, strategic despite operational benefited from decline, North Technologies, revenue points East. second X% the benefiting prior EBITDA performance was modest largely America, EBITDA $XX prior actions Surface America were versus second in the results million. activity. by the revenue Adjusted Adjusted higher quarter international This Middle In million, International in quarters. decreased increase. revenue taken margin was quarter. lower results was quarter, driven by sequential $XXX decline

charges. excluding $XX expense than $X we lastly, Turning And less $XX the million period. and expense was corporate million. tax when expense to $XX items of Net and other was incurred Corporate interest of loss million in exchange million $XX foreign our in exposure forward. of foreign that XX% was related going will loss Approximately the volatility actions to taken directly the in a quarter. million the believe reduce we exchange was

of we currencies unable the the are period. current results hedge the unfavorable peso the to hedging remaining these we with loss our positions of the were period. portion XX% Argentine euro-denominated the impact Importantly, economically due Approximately elements in cost believe the with our and related to FX was to liability debt onetime in that having movements in of biggest

payment $XX $XXX free a with Cash flow the cash activities was from legal settlement of million million. related Capital quarter. and This previous the French flow to resulted $XX $XXX operating were national prosecutor's million the in included million expenditures office. in

cash equivalents million we marks $XX in tangible financial Net August, commitment and and The period the almost completed debt In another of cash $XXX sustainable strategic of with the more sale for ended step million. higher sale proceeds the million. returns. vessel $XXX forward of Apache pipelay million. to $XXX cash We net X our fell to

in shares million $XX $XX we paid shareholder During million. for the and X.X were million million repurchased $XX Total the distributions dividends. quarter, period for

our expectations segment guidance. an update for provide quarter. our to will I to fourth Moving the first

revenue impacts typical sequentially coming XX% the approximately margin XX%. expect we adjusted seasonal in Subsea, approximately EBITDA For with declining at and

to For Surface increase and Technologies, sequentially we XX%. revenue be approximately EBITDA X% adjusted expect about margin to

at come We full $XXX corporate the year. in to to anticipate the $XXX expense the million. of range to Turning end of high million

the anticipate improvement to year versus $XX now second total full our This earnings on the of approximate million we adjusted company range represents updates, when a for guidance for we million these call. quarter With exchange. outcomes foreign $XXX the a excluding provided EBITDA

the reiterate Lastly, we cash to current free million $XXX $XXX guidance year. of flow for our million

my In takeaways from closing, key with share you the quarter. I will X

First, strong when to our approximately year million results the improved QX, for full exchange. company guidance are $XXX foreign given and excluding EBITDA we increasing outlook for QX

year cash return demonstrating achieve to as And to cash shareholders. our the ongoing full distributed Operator, you flow open over of for now and track third, may quarter, commitment the We Second, the improved free to million, us activity. line generation dividend with questions. keeping initiation our in share expected, period a in our the guidance. $XX on repurchase

Operator

[Operator Instructions] David Anderson at Barclays.

John Anderson

the So on a on start order question just outlook. to maybe --

in shifting So pulled Subsea with so? next the forward? looks going difference you billion. the XX%, With pricing What Or does or $XX well. to you tightening, talk kind what mix also of Could should you in just said you're I the maybe think way firming terms over as quarters, forward I year another? last different going one be $XX kind X that is see expecting customer X.X. different the you've capacity of about be billion look of -- think up or market anything about over

Douglas Pferdehirt

I which guess XX% integrated the and for our being That's now David. Subsea. to way much is is would us offering. by I there level, several describe or Sure, at just driven most in is aspects direct the importantly, direct are inbound that. quality of a unique awarded company higher iEPCI it But being to the highest our awards, our over business

And subsea X.X. unique very again, long, Subsea relationships. Our client architecture, our strong the

that few base. I bit quarters in a the mix a customer also now. a shift There's of of about terms talked for

and more the X.X. into fits we our way. we but to access clients, people and those continue clients in really of the and because And And reserves clients existing reserves. We also iEPCI those again, with just expanding the to favorable way very collaborative a moving open quite high-quality new our customer base arena the of are the work clients, and that frankly, combination the see offshore have,

I the that -- we position quality. to have. market is And excited So given it's have what really be Dave, opportunity the guess, gets obviously we selective I the us

we on high-quality create the So years success inbound those can will focus the for come. high-end, that that to -- really

John Anderson

hear higher. over are to than know the past starting few we're is kind something have subject moving Service breakeven doubled another rates costs So rising costs offshore. more We of rig years. for about

with they're Just higher? a get about move concerned customers costs of locked that? driving up case project wondering your in to get customers that do a you customers, any from urgency Is sense before potentially your that conversations for

typically different, overall do range a kind would comprise? guys kind that just helpful. of what roughly just project, I an they're to percentage you just know but maybe related percentage be all And of of question,

Douglas Pferdehirt

what I'm sorry, the part, second of? percentage

John Anderson

comprises sort business of one of projects. offshore your these Yes,

Just Just is XX%? it to of the things. where of you in XX%? scheme it handle get curious, a better Is trying kind fit on

Douglas Pferdehirt

you, Dave. Thank Sure.

help let So me because it second on the will first FEED part. think into do I me first let part start -- the

a or development cost, that new reservoir so existing tying an Dave, facility, there's to XX% into being where we part represent only because a In the development, that's Broadfield maybe an now you're now, can host back We the and a the of reservoir XX%. of XX% to development extended between facility. back fully company brownfield host up normally of and integrated

will, So you we, we the if cost are driver.

but this second, going portion a to project. cost I'm here of we get Now the a do in value that comprise part off of of large

In X/X, have terms is then would the X/X other rule and has That's and would X/X. is floating whoever greenfield We a X/X. about thumb facility the the building of do development, driller the of a X/X the X/X. where

first question, influence but And It's can the material. greenfield the a development, all this quite time. over economics overall now So less why. bridges your a about be in part time. project about simply falls all here's still to it's in And of it little

to I influence companies to way the rig project talk time reality rates, the economics importantly, overall the the on about day to like time. deliver is first the accelerate is but project to understand oil. project most And So returns best yes, of the

with be driving companies there TechnipFMC, much the iEPCI cost best if don't this they're cycle schedule. of and delivering driving and highest the that year can give Dave, that Again, align we want by that we of probability oh, the shorter. with X.X And time typically way, them TechnipFMC. ahead or to is customers' And on -- use the deliver to what's because behavior, X project our they very sitting it

So time. have of of iEPCI, the that's ability as understand to gives our and offshore, ever which an really project a flight Sure, to we're we that unique us we. and value they're to truly our level, seeing to That's able customers Again, how offerings continue higher always sauce we truly through quality. on so our do secret pure offshore the the to confidence deliver the always what projects are play, be focused really economics economics our a and and company to in company the these drive X.X our there. seeing. been understand we to We're on

Operator

Piper Luke Lemoine Sandler. at

Luke Lemoine

margin late quarter. out at that believe just When much actually hit you target laid visibility which initial this backlog in for 'XX you of 'XX, Subsea 'XX the don't time. XX% there's I

frame. confidence show in kind this get next years? in looking awards, guessing is clarify, X visibility even in somewhat earlier target, year. of your backlog coming ahead margin with and predicated X- your just that for slide to then, you from about. a deck, which you And specific which you've margin comfortable that the margins this 'XX, to are X talked though for just the how I'm some direct maybe saw time of question to my where kind raised pipeline X-year not past is, Just visibility what X.X you iEPCI But target you Since have on you've

Douglas Pferdehirt

No problem, Luke.

spot You're on.

of very was very different back And you a what go happening you was was when If it to at offshore, different, it indeed. XXXX, world. look November

So point, increasing configure-to-order engineered initiatives. but at about largely our to were operating And model. internal XX%, That we an our us impact profound change a that's from our has has talking really operating up on to X.X allowed business. the model Subsea that order had margins through to

can't architecture, to -- the develop but to to can't be of -- first, scale to have you And you you then the the have see configured benefits to really gain you just order. able enough do

opportunity unique will, you if company. So our a it's for

initiatives. the predicated XX%, on we internal largely gave when So

from the improved we we to of to are for as XX% company, the model milestone ever it's and a have out, to conditions us ambitious progression and continues gives iEPCI as hence, for improving continue continue market quarter more only confidence since this to configure-to-order getting extremely the our conditions awards the and repeatedly underlying the you raising extend journey. confident and we've our benefit to X.X to Thank for tripped XX%. well increase the benefit XXXX, the -- XX% because is the pointing and we're already a in ability margins obviously, why XX% more be scale the on Clearly, direct volume and not the get said the the major us market be we

So extremely we remain positive future. of the

Operator

TD at Bianchi Marc Cowen.

Marc Bianchi

this said X-X-X, year, Alf, X-X-X, on the to confirm quickly, EBITDA Maybe just for not you correct?

Alf Melin

what the had from million X-X-X from we prior quarter. Confirm. prior guide Yes, is $XX Mark. that I said. the It's up

Marc Bianchi

Yes.

Okay, super.

Alf Melin

And Mark, add maybe, if I Mark, -- can I something, just to clarify also.

we prior the that if mentioned EBITDA of you XXXX. into in wonder, may quarter, be You remember, we doing we will having growth think -- EBITDA XX% also a

you you XX%. this that this still new $XXX million, now of So apply number can take

on be that same off So million very are $XXX happy in haven't just into I'm But still the to place. XXXX. million, the XX% versus backed clear, clarify you but $XXX going we dynamics

Marc Bianchi

of in came was That if great. to That's going you when Doug, Okay. as FTI eye was correctly, market a are see. far where thought but the grow period remember quite can going a I the my we everybody seems be to that's it XXXXs, different. actually And that early like think was bit kind is next maybe I up to shaping as question. which Subsea today,

XXXX early Your versus things be any offering from hear how different. compare today customer curious on period. that a very to But reflections I'd is perspective, obviously

Douglas Pferdehirt

time. Interesting about a question. lot And my actually, this in I spare just think

with were final more lot customers, but could XXXX, if thinking. final solutions, order So we've the been and new of technologies. say standardized. than really order, of the to around you open much will, to Subsea much standardization When product, be customers to that has able And the going partner-led much talk unlock convince able really be ability optionality, collaborative, to look, about the and open customers configure a not more building to achieve still the from engineer to way we more we're the they be the more to are when standardization input that we idea would to product changed have, our to go but which X.X. The I before changed. And it's is really going That the to was what was since the success our just blocks to to achieved key. standardized, be has to able us enabled much

look, So the a which lot goes our of to their have the credit and time. customers certainly behaviors, changed and of over period improved

mentioned we quite expanded time. Our of basins operated historically the of period base in. in Did over script, operating significantly we're has that customer I in the also have twice that number

market, but areas think you it basins were -- frontier when particular going, fairly that any much, about to They're about these offshore we hearing one keeps that start So continent offshore numbers offshore, one the onshore. just contribute in the the developed. They're being limited areas as world. And then not today. are area. offshore start ones around offshore look that that about. all are was in but you well people of don't when the that has the really this it to going -- we're the those are doubled. And those And around about the in they're particular really look think that beyond to at -- and offshore what not world. talking spread They're we're They're the or momentum

to are. do that direct were because operating do I the even it them that's who ability close to for a award to So you pointing our and our we We're We to able us be of model confidence an we're very in demonstrate company and they by work different our the great to today. believe change the driven give want on. clients in very, a thank XXXX. And again, out. is company different. I company. And greater

Operator

Jefferies. at Wilson Mark

Mark Wilson

results a there. sale The the question, just points. set award the there's other I by do and more Apache those of And planned. wondered of of X at all the Yes, on horizon Doug, coming outlook few CCS first then excellent offshore if vessel, a see just points? outside any you

Douglas Pferdehirt

Thanks, Mark.

vessels company that's strategic develop more us ecosystem future. world-class what in if assets have continue through-cycle our that in to and Regarding that's company determine had we able we've and formed part that's are was trust, differently a things the our on in you. streamline XXth going that about not, And or as on And do and the were we to Saipem Allseas going that how then enables our since the said to a to our to to those reminded we focus not. bring vessel of were our second others And look of excited first, XXXX, the like use we be that just I only our exemplary fleet, are the improve really and And really to our I do in Mark, been company company is January the and if to thank to others We do returns and cost we're was regards continue that own work fleet. returns. partners -- base. I'm and way fixed streamlining we to question. of willing not all to got sorry, to they're need and with, operate the able fleet to your our at business. The by reputation. of

saying question, by second that would On I the indeed. answer

Operator

Kurt The Benchmark Hallead at Company.

Kurt Hallead

backlog assures very deliver expanding I wondering are stuff the it. Making able toward this visibility what some on us client -- you you the have and a Subsea be your what was could you're they that that of on give end do risk And managing the didn't time. to going Doug, if and it increased you on you. to decade. inbound your said, them when position handle obviously, lose the sure how insights as internally I execution provide strong throw you're out way, to to and base in with you

Douglas Pferdehirt

be It's want That TechnipFMC. that And emerging to you're looking we -- to is We Give the the question. clients, have will future. basin. We going to be new well to -- -- that's to securing this able at call. discussion I'm into deliver typically million-dollar is want when the call us typically me confidence is this. I the today. with that they new tell We're going absolutely work that's give me this Kurt, the on assets opportunity. you or when speaking that

say First you're and to demonstrated foremost, what you do, we've that. going do and

cycle continue shorten We to times. the

And We the we clients as and work continue of our to to be to behaviors with we want company. if company continue that with deliver the who because innovation want into our partner industry. a to they are the

profound on -- you key the able how opportunity fundamentally past to the really kind More an engineering them this spent they daily of an our the importantly, only fix at can a really the factors we we the change. And configure before we to in give not factors company What really is And many from -- and we helping doing our we the see we order or at configure on should operating Subsea is in project you the single I though external. to internal changed months is time. Directors you our you order change. that did when on company. have confidence, sounds X to a only output, had you -- walk it fundamental X years if I We anything. is know blocks because those And are the at we order, to that's to and going late actually competitors doing the a have a level. putting to X real week that we're say, visibility to with operating deliver the you're of with success got so not could of did our deliver to place success that understand operating this ability that how order will having those to work them Board detailed engineered me, have And be those we shift but time tracking KPIs additional to schedule or of metric well order will, be you're -- and do metric and we're do through building when key is in time. or, configure in basis the Whereas I'm things sorry, now engineer situation ahead start are to model remember, excuse could too a customers. that are And today. can earlier time, place schedule with can The able look it's the the to to them can chain, look ultimately supply ability see clients are enable our year for success we and quite when of assurance at by ahead has what by the a order, today understand basic, certainty order, ensuring -- scheduled and our of ahead. There the the

operating. very way high we'll able operating to and a at different and walk it it just our all they our in They're very, that locations. a So operating really continue experience to deliver level. locations is that, of of And see through in our clients

Kurt Hallead

piece suggest for respect right? even going later Obviously, the recent with the tone. But with book, right? And the first follow-up different oil oil as here, At if the I insights part are had great kind of stuff and not the market in through beyond color. moving in slated You that's try experience come everything curious a seen you how there demand continued together, the latter can't going right? the your going upcoming, of end the IEA, the forward noise? right? when out to be just you customer kind With curious, in oil that's their together imagine the the tying of this decade is OPEC market, to to deliver kind a XXXX. all to I'm to of of order But data to them telling as the incremental had growth bring decade for through you that projects day, We've the different pitch That's this project dealing product. a sort the is kind that to all out some cycles, the to of a

Douglas Pferdehirt

realistic Kurt, data, you clients, you going And influenced most for outcome that's clear provided to factors. very, for I your -- look I continued commentary the very there's think certainly look that's by you of you for high-quality OPEC. just think And external a and continued references to not the be look the high the we that it's at a the demand using believe used in data beginning, and you in demand. that by the level being listen

Operator

Arun Jayaram at JPMorgan.

Arun Jayaram

as of couple wondering some you announced awards large us I from table flexibles business was in as margin bring could think segment. Petrobras as thoughts peers that a about of your we of other wanted X you And to at and project of contribution is I with maybe with of get that Mexico, well the kind FTI. flexibles. how if current think on give a well? sense quarter the how of Gulf and mix profile versus you that are that the technology your to could maybe this the change that the you just Woodside much in As

Douglas Pferdehirt

Arun. Sure,

few to As have the market -- say, who Gumbo would this work Boy-base the a range you you ] who we ] or we're so do our more secret but you offering chose driven vision focus always the is Subsea an limited the leader. we're We've the as only absolutely pointed an the what there's of or depends has time. have secret But is pioneer, ones cetera. And -- optimized very as flexible potential ones This represents. who with who I is recipe a We're out, is ingredient. We percentage the the The why the in without the This there's end of a to can driven to pressure anybody important. higher was have gone situation it's iEPCI This of prefer makes this us the mover. flexibles. go integrated it we're rating, domain. Eve than [ Coflex limited And business who [ diameter, only far percentage et of offering. critical ingredient. strength, driven Gumbo, the ones is business, we're the of it has our that more from of benefit on tasteful. And Boy-base Technip at if reality first architecture. the

benefit the not our get is product margins. the line, ones iEPCI brings the only influence on as it's on within it So it the has we're only our a and iEPCI have product who we The an company. real value awards also but integrated

Arun Jayaram

follow-up That's for wanted a maybe mentioned little $XXX return. helpful. to And one calculation EBITDA I bit impact believe return ask cash of Maybe flow free cash a is XX% how of settlement, is the you growth the guide Alf does to PNF back. investors the on questions the XXXX of stated I does the clarification million. on is policy for soft flow from return? free is a your the and XX% cash from how how cash that the just

Alf Melin

you thank for No, the question.

next we're cash will a return clear, do that flow So that commitment years. we to to first to of of and at going the have stay out XX% least all, true shareholders over our we free very there X

'XX, So well for to further 'XX distributions also to apply is you what see to in that as really we XX% . that growth XXXX. EBITDA expect of that from rate we are saying the

by impact with year increase of free yes, guidance. roughly next outflow cash million in we answering terms to is the in shareholder still So an payments in EBITDA $XXX to distributions expect of drive overall, of XX%, But line flow. our your short, question, there

the underlying strong if of you something exclude to that fundamental the impact this also of $XXX cash you're going So tells about see you flow year-over-year that million payments.

Operator

Scott at Citigroup. Gruber

Scott Gruber

Doug, I to order upside revenue prepared in upside you addition your remarks, mentioned believe intake. to in service to the the

in I'm have whether you as guys number guys of contemplating billion service targeting to curious well. You been just $X.X that inbound are upside 'XX.

Douglas Pferdehirt

proud of bit our the detail you, a Thanks, as Scott. are services I we on QX Obviously, But enough tell to ask with would we'll our be -- Subsea very QX business. question, were you giving call. more kind our

We have of expectations high Subsea our business.

about of Subsea of from and occurred well production higher our installation our and well as expect the our well optimized their should and inspection, intervene really go seeing higher way. also that there customers out in that's to a producing to issue as more but continue most benefit to repair. into services. And only then Really business not of focus ensure which the maintenance help to we're has them means the you So because intervention cost-effective Subsea services uptime wanting see assets may be activity, awards, downhole ensuring some ability level on the project level

a and of drivers amount services significant our multiple there's So optimism around Subsea business.

Scott Gruber

such repair do competition outlook Got given inspection that the more pricing installation that that that those been there's the imagine and it. inspection going the with margins equipment maintenance is the and the outlook just going going and therefore, margins incremental business better, to installation what's for for up. get margin? have then? pricing award competition resources typically maintenance And can that up, volume Does the create between you for is and forward -- I just and

Douglas Pferdehirt

this Well, an remember, OEM model. is first all, Scott, of

So we we everything install. that service and maintain

only world's We businesses. these largest with and the that from we growing. benefit have It's installed base,

treated that we and we're -- an yes. to work on with with about -- closely upon are talk clients. comfortable with award we're to growth very satisfied market. couple we want based But getting know, that we've we're business. Look, our of in economic ensure a that feel you pricing. As has reflected our all a being I appropriately where activity Subsea been fairly had OEM into basis, the years that, last subsequent lot We Services years over and the very the They an it's business. relative very substantial That don't

Operator

of Bank with Pant Saurabh America.

Saurabh Pant

just a quick quarter. is your outlook Can has Doug, on demand. about of your you context maybe little follow-up capacity, because one that I'm for earlier Doug, And capacity talked the bit industry's really flexible on to out sold the good to question the to It's on to the traction a being XXXX. third to deliver flexibles talk the about large competitors that talk asking and reason demand see on.

capacity trying looking, So FTI. the I'm think demand how particularly looking to at just how the

Douglas Pferdehirt

that if so higher don't faster technology on throughput, in part like much ensure on business, every out. or we developing a just our -- We of focus sold you we The being will. time Yes. deliveries delivery or focus can shorter

including doing methodology hence the by Subsea through is facility in So X.X the doing time utilized. of additional size Or in X.X, of still our the you're the offering and XX%. percent if capacity is industry you sold X.X reduces engineer-to-order as words, you're broadly, X.X, of now we doing, your by which point out, flexibles. other flexibles, look constrained offering, -- we're at including spending expanding without X.X the entire facility rest Subsea put What the out twice our or kind we capital. When existing can through or being across facility our the

So cadence needs. that's can we we through addressing order our thus a have manufacturing can facilities, to how is configured engineer better our a the product order versus market's approach have higher to that

again, point direct other iEPCI secret out iEPCI an The the to our an because, really partners, is, I pointed our would aspect out integrated clearly, ingredient projects of that's on focusing our as project. earlier, I success or awards, we're

some market and in, end, So we will, flexibles portion answering was the I is do do we the prioritization, can the quality, we said market. There that's one on which when but to of That's I you some -- earlier, end flexibles we commoditized flexibles your more a of which work where participate portion do well, the market. lower focus. certainly the colleagues is we high why there not of if high end as is some prioritization, of tend of

Saurabh Pant

And Okay. get because from a just question investors. we follow-up this quick a Awesome, Doug. lot

asked. I just FTI industry's to it a venture. to overall going capability competitors me think we the you of the venture the respond get in about should impact And particular? let recently potential should way the about that? what's how Two on. How So How think investors formed impact does your of on joint ask that joint market,

Douglas Pferdehirt

clarify, X to the talking just about you're So Subsea?

Saurabh Pant

Yes. I'm talking about the one of the joint venture.

Douglas Pferdehirt

the Oh, coming Subsea X companies I'm sorry. together. that are I meant

Saurabh Pant

Yes, yes. yes. Yes, Absolutely.

Douglas Pferdehirt

the and validation I think look, clear first of foremost, the Well of strength market. it's

strength X forward. the in going together companies the You be if see would market wouldn't they didn't -- coming Subsea

it. of our is just any things about right? a that's, we've and things a where company. that's thing. So or also So direct reshaping quite the better I together. awards our it's our lot why offering, these is feel our the Investing value, to one about is companies the believe, actually a to in is market, industry. frankly, and of But bringing go we project quite seen We've industry doing see company, level see to point clients' the to it's of quite both continue we to returns, favorable they Consolidation that are validation. improve a going way in talked see integrated technology, Creating of which an unprecedented

today, operating alone easy it's at And bringing I'll we in it's It not candid. do. So everything companies, when look, lifting the it did not took from took together the heavy ago get our operating back It point XXth the January X merger very years. of our I XXXX. view, journey. completed level or the that of we be let started long to at companies, X in to look, is We XXXX. years believe

you ago. clients we're Subsea singularly And and we we're that. did X tell can projects. focused success years focused their our delivering ours by today, really So world's glad on the on best I singularly very

Operator

ATB of come question at line will Markets. from Waqar Capital Our last the Syed

Waqar Syed

guidance be First X orders quarters, in the around over inbound billion. one, could that Doug, $XX next given Subsea you've

If but you that view upgraded? remain increased. X to Or back over unchanged, has months, the has X outlook relatively been has look that in that confidence last the view

Douglas Pferdehirt

I been question. increased. and say upgraded fair would the it's has A confidence

Waqar Syed

Okay.

EBITDA? XXXX Now any then your does on outlook impact that have for revenues and

Douglas Pferdehirt

not. Absolutely

Maybe about indicated XXXX, in expect an be for will will QX too on target billion clearly, $XX an the we the guide. When quick update of that clarify. be we you -- me as script, answer. was that you giving Let my talk that on

very said a be So which as obviously gave XXXX opportunity fourth We'll to and EBITDA, may that an which for quarter EBITDA number, quarter this a be as view if second well. call, on giving -- our earlier, we for that shows the pattern. on as in But increase it's we is trending quarter, clearly, right inbound, we're were total the going you company just again, strong revisit XXXX the out I mentioned, consecutive increasing XXXX, segmenting take staying we're direction. to you again the

Waqar Syed

likely of I million year, terms this change? year. year-over-year? that next so Okay. And for likely know still then spending, far $XXX kind base in is to early that's it's is for level number of that Or stay to your a XXX capital

Douglas Pferdehirt

is prioritized their to I investors a don't being number visible number spend. it's encourage we upstream, because truth clearly for What offshore. in know And The it's and that of decision-making. an know. really is to I I being to clearly know it's it's And it's people to the realize important use prioritization would prioritized

some confident the to additional perspective, expenditure. capital very continued we add are So growth from to Alf ask in going I'm And the of our comments.

Alf Melin

look be to just going capital long have that guidance the when that range long-term we -- our we I given to want X.X%. range we at the in so to add X.X% are the expenditure, reminder -- of

X.X% that the of X.X%, have seen that the operate more, we end over guidance, continues and the XX range, for a to However, and year. term. right of true next that for revenue we past that at year going level. now that this be probably really It's just be months meaning for can as lower intermediate keep to It's true for and number the guide

Douglas Pferdehirt

appreciate thank for clarifying Alf. to it. and answering just was expenditure our it Thank capital customers' I wealth. No. answering from you you, clear. it the internal I was I be

Operator

to remarks. over Seinsheimer turn back now will parting the I call for Matt

Matt Seinsheimer

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

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

Operator

participation. call. today's conference This thank concludes your for you We

You may now disconnect.

TechnipFMC (FTI) 26 Oct 232023 Q3 Earnings call transcript