TechnipFMC breaks subsea order records, expects to reach $9 billion in 2023

TechnipFMC has received $4.1 billion in subsea inbound orders in the second quarter of 2023, a 62.2% increase compared to Q1 2023 and a 113.4% increase compared to the same period in 2022. Records were set for the company’s iEPCI full-field subsea development and integrated project execution and Subsea 2.0 subsea production system.

TechnipFMC’s total revenue in Q2 was $1,972.2 million, while loss from continuing operations was $87.2 million. Adjusted income from continuing operations was $44 million and adjusted EBITDA, which excludes pre-tax charges and credits, was $205.9 million.

Total company backlog increased 25% sequentially to $13.3 billion.

“Our second quarter results reflect both strong operational performance and continued delivery on our financial commitments,” said Doug Pferdehirt, Chair and CEO of TechnipFMC. “We have strategically placed ourselves in a very differentiated position. More than 90 percent of our total company orders and revenue are generated outside the North America land market.

“We are fundamentally changing the way we operate our business to ensure that we create greater value for all stakeholders. This is clearly being recognized by the market, with the quarter representing the highest level of inbound activity for both iEPCI and Subsea 2.0 in our company’s history.”

The company’s Subsea segment reported revenue of $1,618.4 million, an increase of 16.6% from the first quarter, said to be largely driven by increased project activity in South America, the North Sea, and the Gulf of Mexico. The adjusted EBITDA was $233.8 million, an increase of 64.8%.

The segment’s operating profit was $153.4 million, an increase of 129.6% from Q1. According to the financial report, this increase was primarily due to higher revenue, improved margins in backlog, and increased installation and services activity.

The full-year expectation for Subsea orders has been revised higher and is expected to reach $9 billion.

“Subsea orders included six integrated projects, including the direct award of our largest iEPCI to date, a contract from Equinor for the BM-C-33 development in Brazil. Year-to-date, iEPCI has accounted for more than 50% of our order intake. We continue to expect iEPCI to achieve its highest ever inbound in 2023, enabled by a record level of iFEED activity that often converts to direct award,” Pferdehirt said.

“Subsea inbound for the first half of the year totaled $6.7 billion, giving us confidence to raise our full year outlook. We now expect orders to reach $9 billion in 2023. We anticipate 70% of these orders will come from a combination of iEPCI, Subsea Services and all other direct awards, highlighting the quality of our inbound.”

Surface Technologies reported revenue of $353.8 million, an increase of 7.3% from the first quarter, driven primarily by higher activity in the Middle East and North America, and operating profit of $25.7 million, an increase of 14.7%.

The segment’s adjusted EBITDA was $46.9 million, an increase of 16.4% when compared to the first quarter. According to TechnipFMC, results increased largely due to higher revenue and improved operational performance.

To remind, TechnipFMC reported full-year inbound orders of $8.1 billion for 2022, a 20% increase compared to 2021, said to be driven by $6.7 billion in orders from the Subsea segment.

“The market backdrop remains very strong. The FEED pipeline continues to expand, with more projects in advanced stages moving towards final investment decision. Our Subsea Opportunities List, which highlights projects available over the next 24 months, remains robust. Longer-term visibility is also improving, with clients securing capacity for projects that extend to 2030. These are among the many tangible signs that support our view that this will be an extended market cycle,” Pferdehirt concluded.