TechnipFMC (FTI) 30 Jul 202020 Q2 Earnings call transcript

Ladies and gentlemen, thank you for standing by, and welcome to the TechnipFMC Second Quarter 2020 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. Thank you. sir. ahead, go Please

Good quarter good XXXX Lisa. to and TechnipFMC's second earnings morning you, afternoon, and welcome Thank conference call.

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

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

earnings participating good call. you quarter in second Good Matt. Thank morning for and Thank you, our afternoon.

of MacGregor, Energies. Chief Financial On the call are today Officer Technip and Catherine Mannen, President Maryann

like by financial of commenting results, the and workforce. I operational resilience Before to our begin would our global recognizing on

and our to quarter they this evident manner. business and to results. advance the safe is meet health customer priority, our challenging in our teams dedicated was period, tirelessly continue requirements, continuity very wellbeing responsible second And customers top throughout maintain these worked which employees, partners a and of While and projects in

made progressing We and ratio. in were billion, which debt the permanent our and proactive current to to core balance also a our TechnipFMC of primary have strengthening $X.X With solid backlog by regard taken nearly scheduling, billion. the all maintain quarter. business our the modification term. balance to the this bringing sufficient liquidity increased ensure times. $X favorably ensure total and covenant, these cash And that liquidity longer transformation, cycle sheet, areas, than access the took to through over sheet, actions both full we challenging Together, We accelerating to these and total three success capitalization a to we steps impacts progress our in liquidity we the in company's of our can secured liquidity more series

we dialogue have work Turning We partner $XX years. market the the our we of the we us backlog customers. with experienced conversations in provides than opportunities more supported had visibility creating over the to possess backlog. enabled attributes demonstrated experienced of have we very has collaborative This us, and way by unique in for Since solutions a and nearly resilience the next resulted COVID-XX cycles. to us deeply our cycle. prior what engage This the approach, to start execution in billion no by we also and strength allow These weather backlog today. highlighting different outbreak, extends the in been has with new customers. the innovative more excellence proven several financial our good significant that cancellations, The with constructive of

SURF EPCI been Looking add continue new backlog. has Mero in to Santos projects located TechnipFMC selected to we year, project our X the the second at the for half basin. of the

soon have contracts announced Assiut be will subsea that And EPC contract several using will Hydrocracking for latest our Equinor by will new earlier Complex projects iEPCI the X.X recently we announce announced the technology. including that final this We secured installation sanctioning, and Asia-Pacific in be project a month. inbound upon we

These balance strong by liquidity to first savings actions successful introduction backlog and and We transformation. transformation fourth changes business. position our created us provided during million initiatives and Our extensive new in highlighted year-end. digital and annualized with by business With $XXX to call. accelerate driven opportunities solutions of global business our from cost of quarter have the the our flexibility the excess across sheet innovative underway technologies business also our earnings are models, generate

solutions. going forward, comprehensive First, need more deliver assets fewer to we will

have fewer will sites. and facilities, operating manufacturing bases, We service

are We across returns operations geographies our look and don't make economic we will to sense, optimizing if exit.

We will a fleet. have smaller

integrated with partner our project continue continue with in we Subsea delivery. align And technologies to our manner. advantages We to new to rightsize offering more us others, access to unique differentiated assets such as better assets a and and efficient of X.X providing capital the

longer we particularly our our with And targeted Technologies. to further customers across in our our America, technologies by to the we of In the and wellsite drive operations finally, capitalize And emissions. North in lower are taking anticipated efficiencies gas Middle we continue continue working to leveraging Asia-Pacific, portfolio, growth we're digital leverage franchise across the Second, greenhouse operational the strength actions Surface and to term international East, organization. Sea. transform North the on

reduce required evaluate we field as to practices. projects at by scenarios, development utilizing as best AI and innovations, learning machine industry's engineering the Looking much allows prior database are most largest rapidly the to platform. Subsea front-end development leveraging recent of of XX%, accelerating the implementation and our one for us of digital Studio time Studio our and significantly Subsea

our willingness and our We're aligned will streamlining embrace simplification, aligned businesses In strength business with a annual and inbound technologies. of we relationships value actions the to demonstrate all And and driven decade. award. strategy over reduce our XXXX, Subsea the commercial growth These that of to will conjunction in clients of standardization partners in iEPCI that times. cycle All models our first in announced actions with towards model a most order and be highest market when resulted the are partner vast enter the further of in integrated rate project of these transformation. fully expect drive into new integrated exclusive leadership alliance company's success we those and by the another was with new client’s

those more external our impact environment greater with XX%. emissions core this competencies we and given vessel And reducing campaigns, nearly convinced simplifies we're Subsea its solutions in in greenhouse today, simplify gas manufacturing, our projects. by succeed change to initiatives greatly that X.X benefit. created Subsea an more infrastructure and in management, in As These traditional energy on allow it transformation dramatic installation the environmental adopt that customers. way iEPCI, are fundamental also change across even Incorporating be manage engineering, of pillar the segments. combined providing design, and sustainable new our can leverage skills In the I've the When is said before, lastly, third new we while and portfolio transferable And to Subsea, on and even beyond have of us are economic project focused our that will market and solutions applied platform innovative our to landscape. execute our business deliver initiatives the likely the the clients. will strategic

sustainable in environmental not all-electric vision infrastructure eliminate Our the our renewable to subsea renewable and as circular an their by collaboration expanded significant includes if prospects Neste’s with subsea Carbios further for chemistry, diesel simplify demonstrate the This And reduce recycling of in Energies, powered have area through technologies. partner Technip our choice energy. emissions. of subsea we notably biofuels system projects. economy we have will and in the footprint further expertise for In

green will production meet environmentally we enable iProduction, client fully greenhouse our to during the our our very hydrogen, extended across phase gases are to faster that positioned the we project advisory In a of particular released that to integrated emerging technology have blue the expertise and innovative, Genesis production summary, see hydrogen. offer atmosphere capture future our already and well offering, markets we clients exciting for hydrocarbons with Technologies, focus enable an we Surface the across high solutions transition. unconventional a of of We In systems. have and where allowing energy clients for of proven all development. have reduction reach solutions system, utilizing are have deliver the And market services references that for for typically of provide the sustainable the optimized to hydrogen into we compact efficiency a portfolio a ambitions. with carbon their XX% our the segments Today, on to all business recently over

On have $XX billion updated we the eight up Let noted our operators, our estimated first me call, in value beyond be have made captured projects window. identified could to public outlook. turn on trend. extended opportunity to reflects beyond now list list extended project we quarter XX-month of disclosures by real evidence mid-XXXX. the been the XX% The Based subsea on specific subsea this that of that

projects as be in as different within value been two believe future opportunities for be not opportunities this have is There awarded been basins they complete projects four high awards. to reduction Remember, we of Importantly, list actually of identified previously to these the a XX%. XX% added that and next also none opportunity that opportunities across TechnipFMC. the longer canceled term thought years, to for closer once have list is new will remain subsea the suggesting available

This $X activity, has alliance awards enabled project generated this subsea of have driven last our and list years opportunity company. the direct is by unique project leading much which inbound our installed active in capabilities. of base, activity, each over been to Beyond of large set and exclusive integrated iEPCI billion partners FEED growing three market by small of services, is – large orders and our

is front Our exclusive this remained which benefits will FEED opportunities, more studio. XX of subsea XX% additional alliance XX engineering the believe than months. end integrated all We active, next from work partners to leveraging our generate some proprietary over of teams and come of the will very

months to the first year, had we of For billion. the billion continue they to stranded announcement. qualified $X level small in That similar remain five opportunities. by the customers will half likely success for of adjust current $X.X attributes with the subsea we to half In closely large a project and we ever. choice key services, And step that the our XXXX, from we serve In awards, see will operate entrance of pending already are the inbound. project activity long-term of the as subsea the is coming and to continue year, inbound than potentially orders economics, excited will approximate of inbound remaining believe second in year, we interim, partner subsea to new all subsea with to of work TechnipFMC. environment, the relationships; more uniquely said, and makes public This now driven innovation us in

be the ramp to TechnipFMC. good in on Coral X, On Turning project projects, challenges as are to of well X, Arctic module execution delivery industry’s execution projects. we through this strategic and have LNG in the integration and to projects projects. dynamics instrumentation. continue strong positioned milestones be is of phase to on our we to X Floating we Successful the progress to LNG a challenged the to Market the a has But of of alter LNG continue warranty logistically currently key the of these recent FLNG, leaving development we over achieve the This certainly strength us expect making create major contractors, shifted in we’re the the not these Yamal the consortium’s to broader LNG direct LNG of the successful projects the EPC be Coral said of is decline. list continue complex decision case same key Yamal and advance of the the and in will references, the role scheduled Despite LNG, Arctic for relating Novatek-led in LNG. the XXXX. most to phase months, player can ever, all And Arctic project two most the technically and in sanctioning. which word this the number in and Energies. subdued COVID-XX, been viable period near-term, qualified played of industry’s of landscape likely remainder Technip activity will LNG of to economically

We cycles, an see through have we don’t for but demonstrated start past remarkable as extended this resilience of downturn us. the

Mexico. today. and the either awarded are in remain backlog included have Both Energía Costa our We in the already second being Azul and these Mozambique Rovuma been investment in decision, additional subject two projects, final of projects first to

While Rovuma year. Costa FID indicate Azul operator will place for been to XXXX, the continues delayed has this that until take

project East In LNG addition, major are end a other we on front Middle the actively work in tendering and engineering prospects. performing

are which due This country. in to projects diverse. host and the to project their remains of with of Some likely forward And LNG to portfolio part will provide their us move potential importance strategic LNG continuity. well-timed operational beyond portfolio overlap

entered built our We future and strategic references strength solid balance well positioned such record successful solid petrochemicals with as period upon project track sheet, a of this built a downstream that execution, delivering awards. us in and of have We areas for foundation execution. leave the backlog

for business by acceleration guidance increased today transformation turn maintain expand the the detail. While our leadership. over now visibility to call client we financial is on remain I’ll supported further us gives our in initiatives market results in to confidence of year This our business to if segments. the have Maryann discuss full more conversations all our not going,

Thank you, Doug.

improved provide giving quarters, foreign with in back exchange quarter, billion, exchange us Looking accelerated severe quarter, come at Surface And our $X.XX from numbers by by these included from than losses. was three the to America. a these the are revenue our exchange we resulting an million. Technologies decreased by interest full the from program and Beginning with in reported share savings year from total moment. savings to achieve I’ll second reduction per both benefit consecutive corporate in EBITDA the statements. a COVID-XX the the our adjusted would increased impacted confidence the track $X.XX $XXX planned last million. adjusted headwinds revenue decline Energies, full cost in costs by venture activity, expect We when are $XXX have a totaled solid separately Adjusted were year cash for company over in performance billion liability revenue North quarter guidance, was second estimate reduced which driven our approximately been lower period We diluted our two greater cash in and be period. financial joint excluding cost our was with share. on quarter of subsea headline in as a impact year our Year-over-year result expense while if of expense $XX Adjusted payable The Technip million. Included impacts charges per after items the of XXXX. cost to and have realized earnings to partners per savings the ended activity cash now greater to and $X.X our impacted for to net share earnings, of in $X.XX $XXX tax And and operational corporate impacts. the foreign Together, end. deliver clarity EPS foreign to earnings credits. excluded, target Underlying million half more expense per in expenses $X.X share in

We have free inflows cash flow and and for on remainder of year around have visibility uses provided the outlook. increased the our cash guidance our

$XXX Turning for million translation unchanged the segment to $XX the would of second company X%, declined the expenses negative exchange Subsea have dollar. Year-on-year Direct but of the million excluding been U.S. foreign revenue the highlights. to COVID-XX impact totaled strengthening quarter. when by in due

more margin relevant prior ability adjusted more XXX basis this revenue quarter, was cost mitigate basis initiatives. related reduction for in points margin Subsea XXX disruptions related COVID-XX related sequential the versus mitigated backlog, usually declined Subsea impacts partially the as the execution in are the to quarter. comparisons due COVID-XX only and by year quarter year-over-year to negative disruptions. competitively While in down XX% demonstrated the strong to an segment, Sequentially, part priced offset primarily points COVID-XX improvement our operational entire EBITDA of

driven prior of X LNG, ramp by Technip strong in versus The LNG solid Yamal the on lower to contribution Process on as stage Adjusted year remains business. the remain LNG. continued more across more realization given year-on-your from Arctic downstream across we than revenue a quarter Technology and and up at even from Looking Energies. the margin increased portfolio. early Revenue our offset levels, higher normalized activity EBITDA projects. reduced Execution XX.X% Yamal decline returned margin

decline proved were Surface no quarter loading scope of in announced driven only was completions well adjusted the significantly contracts. in in good revenue awards activity in dramatic North America. process decrease sequential with during East. The modest activity in by by as project affected on be Although significant related expanded inbound second – declined the a to And activity North and existing in XXX orders was million EBITDA Sequentially, as demonstrated resilient points services, Technologies, Revenue and systems, North quarter, $XXX recount operator decline decline the margin in outside basis supported solid America. activity Middle X.X%. America the by to technology

our We In addressing where our adjusted for base. the America, North supports positive full segment which majority have America the restructuring point, of year. the we cost breakeven the aggressively for lowered occurred, expectation in has EBITDA significantly for our North are

€XXX to the we liquidity mentioned taken took incremental has than facility, most needed, lowering million of Bank rates of these opportunity interest carries it this if COVID-XX We remarks, other sources secure the facility We undrawn. liquidity paper credit expense impact our million additional but commercial the to in And As benefit the the position. sources. markets. this a of liquidity the facility current of £XXX England lower interest challenged in for Doug on economic our added in facility, two actions this his and financial have environment revolving is quarter reduce credit of

revolving the of outstanding when of quarter, our the funding, This maturity calculation, considering liquidity $XXX In to quarter used billion. to at end repaid today. in the liquidity we steps covenant the taken XX%. due at quarter the our end the we million debt capitalization goodwill. when strong $X.X available stood is the and credit including also existing the all on $X.X $X.X took March. our the we permanent up a billion facility month. to compared value for quarter, the Given in amendment of with the of debt actions billion, of second to cash with cost for this quarter, balance to support The the to Net significantly extend access secured allowing $X.X revolver, placement increases ratio us previously of In that equity of billion first profile the the providing also came us private add-back lower impaired

We short-term in to currently address are coming the due working maturities XXXX.

Turning to guidance.

XXXX all segments, operating billion of cash supported full half. second now are for three We as billion to In guiding the the in scheduled year $X.X backlog providing well guidance revenue in we by Subsea, flow. the free be are range to $X.X as

backlog, for addition to we full Services $X In to billion. to expect be Subsea continue approximately revenue year

We margin implying at X.X%, second of recovery. least EBITDA a half expect adjusted

the in For line with North is unchanged XX% $X.X XX%. revenue of and year. half projects implied revenue in scheduling. $X.XX of with billion our a in representing revenue in in EBITDA at revenue adjusted major least the with margin quarter the supported range we The America, the up expect first the And outside of of continued in million is total for billion Surface Technip to to ramp Energies, of segment around step $XXX revenue Technologies, range guidance from as second an $X.X billion backlog by

in recovery line but least EBITDA second of demonstrating adjusted low. broadly the with X.X%, expect We half, from at first the margin quarter

in This corporate reduction to items. expense When of earlier more improvement guidance versus we million. quarter year. to guidance expected assumes of in other $XXX environment the and the midpoint half reflects year than COVID-XX and an the excluding year. than and to charges is expect prior XXX credits, the This expense a at we of last XX% million range of Turning now the The the also cost spending due constraints. of achievement reductions discussed normalized that second first the more operating half lower

provision tax discrete We expect $XX between for and our full year to excluding be $XX million million, the items. reported

flow provision be due net adjusted of the be While is slightly higher cash to remains as define we to cash from jurisdictional which income year, to from expenditures other the $XXX between forecast is flow, the the guidance in and mix. million. back neutral first less capital flow Free operations, All be in work unchanged quarter. lower cash change should tax half expected

expect In has to and we turbulent year. summary, dividend cash approximately Beyond an sector, of are well in joint of time remained second $XXX on Yamal in free extremely the targeted flow, partners million half an exceed to venture we the to execution the strong additional cash make for cost the our our savings. payment track

improve steps take on free structure. our to cash to flow continue and focused cost We remain

the with in against accelerate strength robust our demonstrated our headwinds of enabled liquidity across outlook segments, business you greater have our in and have year and full external backlog support to for a to and have our given our multitude Our we provided the cash questions. ability the of now all may And open initiative, the us Operator, transformation. we call reduction improved confidence visibility execute cost backlog, into guidance

first Michael Thank line Instructions] our And the Alsford from from Citi. comes you. of [Operator question

open. line is Your

please, Subsea I question. you obviously margin, COVID my low little costs out I – talk taking about for talked Thanks split they just out margins for the you. but One Subsea? like you guided, of you've could guidance, within related on like the quite could a bit if to Subsea, it's think about. and still Thank quarter-on-quarter, or really direct

about, that could a driver what's little bit it So weaken the you. of Thank perhaps margin, please. talk

year, on QX flow Happy second we quarter, indirectly, were But provided which now margins deliver the direct least – of of an obviously operationally to much a to back of extended At the an improved. Thank and most the the not or outlook quarter, that for the forum recently the some quarter, we did of back has in the temporarily workforce extended to were first an suspended that that although, COVID the back out. point, for you also through of or and that the first dedication said, and you, number actually since the we delivery spoke second the year, expenses operating called conditions had at by their significant of period not and for really Clearly, the having results, at our our overall also certainly remainder now half guidance Michael, resiliency We we the business of question. all We're for very increased delivered only business – facilities we're impacted. half in total being again, we the the time. suspended in challenged that the relative of expectation report of to has was a phenomenal year, XXX% were operating the certainly, X.X%. this the for end efficiency, results. have operations of either

future of they've done, that half. improve, to give ability of very obviously has year the XXXX to now work second the don't the caveat the expect the if exactly improve what related the be future full have outlook But to in with there impacts to continue be proud you to the we progress continuing that margins impacts team the to confidence that the pandemic. for the know to we – made, with will that So were

given call today. Doug, Thanks, visibility from appreciate I and extra the the

could follow-up, quick Qatar. I if a on Just

the be you be that you're just Is you very come on I well any work the as pushed like might sanctioned? wondering whether awarded. get Thanks. to XXXX there feel that into be to doing placed to it was seem next actually You might year? feed. given when Or do sense that

And Catherine I'm ask more provide very a to to exciting color. opportunity. Certainly, going

Thank long exciting with very you extremely for past. We've you rightly been partner in involved that of previous question. project said, the Certainly, in a choice. engaged time in Yes. Thank been also for you projects the a we've much. opportunity, as

as this a well very customer So technology. that the we well environment, as an is know country,

in be feed to involved the delighted for absolutely we and preparing So standard. the

importance indications the obviously, that as this the and and make the from project far is our the the its all be that us signs communication look FID to timing forward the tend As confirm strategic receiving project, near of future. the to project of of QP. The this to customers indeed are sanctioned we in sanction for

Now, precisely for difficult us to or answer near very it indeed sanctioned whether year, to next it's interesting term. for early But in this be could us say. this key not you. and to is Thank this question. important that the year frankly, is indeed can I the be a likely very project

Great. Thanks, Catherine.

Cowen. of comes line next Our the Marc from question from Bianchi

Your line is open.

quarter. I looking you and guess, second Thank the you. out quarter first in called the just disruptions of and question, the you the COVID at – mentioned first some expense

you should of, As give half, we the an adjustment be to expecting? lifted back you can us any sense what sort of

Sure.

cetera. to have made with and and putting employees shared, yet of vessels, try with progress only on the again, not as ways color. are minimize bit an be that Maryann we’re of more remains second provide manufacturing in example, that the ask tight pleased And quarters, of on that mentioned of we're plants, spread with significant implications to I'll the now there in first, some to Obviously, particularly, really, today aware set could half. in really the really, our really we health, additional but we've the the virus, earlier practices the As safety competitors not a And we've progress and best question, and that occur wellbeing et certainly the on standards our will peers made. clients, our challenge I industry

Doug. thanks, Certainly,

normal. are are that they plant, as example. when them COVID-XX mentioned, see are. our These explained, facility what is Doug the our these not supply inefficiencies expect are beginning These be chains, call we directly, Doug out margins. as have lower that utilization, to be, as about of think And we operating we as maybe bit delayed as costs lower These stay Doug in would mentioned, We So meaning expenses, are some we recovered. closed unplanned. within an costs about to those not return do rates, a to impact extraordinary of they

assuming quarter. would operating their So are less know that project the we nature. than continues eliminated These necessarily all our we trajectory structure, that third from be costs expect and to would we to given we expect see can't that

So what remain certainly the challenging them would half. a them those would to normal return with would to do be then expect wouldn't again, as COVID, calling we we rest in costs to continue today, to of we more our be as project, And in as environment, stand we but margin. The less happen out they back anymore.

Sure.

for thanks Doug. Okay, that Maryann,

anything EBITDA anything should flow, back unusual implied about half what cash Or the kind $XXX kind the guidance the $XXX flow if really is do conversion that there's by On full I'm million think we of wondering is recurring to implied of the if year pretty business milestone is, just like strong range. can implied of cash out is cash that the that. payments or basis? on a free flow million

mix you business when important like we additional some some will, is question, you need a make. about and think the we provide the color having that prepayments our will asking as And on Now And it. not part would to It's we projections of part color. projects, provide Because an and overall projects to we appreciate if in. of Maryann unusual, awarded additional company right?

the the discussion the also year. Obviously, of in the repeating year. half that seen you segment, settling flow good happened against back our particular, the in items first quarter look are the operational would outflow performance will we about And that a Energies not the in you in litigation. certainly second One say Doug. will while of we And year-to-date the keep necessarily as just to and news may have beginning mind, quarter. in in of and see that's in is, not repeating. this that successful that the next until cash have to quarter, attributed And that second the not the two that I happened had $XXX previous payment thing of not in were we made quarter, lease settlement Technip we Sure. million Thanks, settlement at

second year conversion. say is or of question normal I back as beginning a part consider your of there. you not get whether And we’re half the the to more would The can

EBIT back to working capital As continues you capital, have frankly, in and Yamal begin conversion. to can the we half see our and, on contribution be of year, well impact smaller to less know, you impact the working less a greater as

obviously to stay are try cash series projects We assuming obviously, a across milestones. flow stay We those. positive – of

half be our You guidance, EBIT on back based the see would in the year improving. of the

the to you you the expect conversion year a normalized So can half should that representation a as better at in environment. of back of more begin look the

Thanks much. so Great.

from UBS. And the our Amy next comes line of question Wong from

Your line open. is

Hi, good from of morning, good afternoon. questions me. A couple

those on bit Can confident order hit that you having you’re of Firstly, some the clients? them How on you’ll kind sound color FID? your that a conversations to the more very target. with that for your about Just is just please? are give Subsea make of pricing us conversations intake, you talk sticking What evolving? points

been Technip my prepared have remarks, backlog, as we yet Sure, the Energies. our Amy. In Subsea the not not us all as in in received requirements that afternoon. highlight well fact awards, met to in I which for And have to tried yet include several good both

in So by a the a And way, by utilizing in I project project talked technology. I Subsea projects about X.X Sea the recently Asia I an Pacific, Brazil. iEPCI talked Subsea, of announced North about Equinor. in project in the talked which, portfolio about is

is project, Technip value. In Energies, total announced in $X Assiut billion over which we addition for the

So us awards. terms it’s period been a of in for strong

to fell but It’s That’s those us be a sanctioned, will will slight issue. it’s not a timing We confidence. few met, And projects a certainly be unfortunately, if of have not conditions what but all of of met. question been in just haven’t QX, outside been provides the yet, inbound be QX. those the will able they of

line very So year. of we clear, prepared billion. a the clear another on said And remarks, we $X.X half have in my $X.X already that first I sight in billion to have of be the

of to were So, things I QX. just a in have past lot think be QX QX because will or early FID-ed the fell into order you awarded QX look in rate but

I XX% guidance we have billion $X to confidence, therefore, you still that approximate in that if achieve fill that. we the and, previously of last add the five to provided together, had those Amy, have months the we will So

are clients that much is conversations project Subsea also ensuring public economics. of list we pricing, list company, access the we very the most very opportunity best the that around and the the publish, for can of awards receive of of the are which conversations majority our that focused a terms they very domain that the to. achieve In the have from into the Therefore, and actually that have others we total large which award portion direct come don’t

billion list in market our leadership on a company. $X new is and We not have reoccurring our our but is exclusive makes a script, year to as leader, technology commercial new a the and that unique so what offerings our which I be and that with allows my only us us This much extend – as market basis indicated models. to

on Amy. conversations we around very achieve economics. the others in So a most project the our to aren’t That’s in way work a project favorable space. and together collaborative difference this And those company between those are client economics. the pricing, really with They

That’s good insight. very

Just follow-up Maryann. a for quick

much please? how cost savings, you cost could were quarter, the of For the in the savings realized quantify second

Yes. Thanks, Amy.

know, we what all XXXX, by we’ve the you plus. of As is, will have achieved $XXX million indicated

million. going rate will be into at run that $XXX So XXXX least

as to we’re of planning get there. – ahead we that trajectory We’re as get

in actions achieve are take than complete the to year. order that we of with So through all this we the XX% need of that to half more

I’ll it Thanks turn Great. over. much Maryann. very

You’re welcome Amy.

of line JPMorgan. Sean the from Meakim comes question next from Our

is open. Your line

actually implies The – to for start half. XXXX fiscal margin just on for plus discussion. a Doug, on continue X% the the to guidance type number or back Subsea

early, start that’s looking investors to directionally, So It’s going are constructive. but to XXXX.

$X So maybe better a a revenue year? awards. to we of year, blocks. bit early year growing think up. maybe about the so commentary some guided That’s too not too award to your where maybe of is revenue But next I building at guidance, XXXX billion below for think This least for drives end you but early that’s more first important. be towards How still XXXX. sounds margin some if building more or very level you blocks COVID and progress XXXX normalized frame pretty opportunities Services in recede. obviously would Book upside, disruptions constructive potential that’s could half maybe turn, back half next what back terms here of those challenged,

the the thank think highlighted Sean, question. And well. for morning, I you very building blocks Good you

look you projection have project discussed, that already If covered. the to for the we We lot inbound a in revenue as XXXX. of can just potential XXXX, you at start order

We got additional have awards additional a awards second the just in talking strong backlog. about We’ve obviously the this done and year. of half

efficiency. revenue as it’s the getting and experienced And that to progression to far just, a upon of of XXXX seeing improve HX guidance, the provided. about. XXXX more today, world the the given But we to normalized early to are give line, guidance, talk we the last terms continue based right, as year second remember, operating we’re margins of it’s the nice you’re in let’s we giving quarter. you fair as expect XXXX, half to into as that said, back we guidance the And disruption look So in

adding be We’ll we orders, as discussed. just backlog. strong a new have We

continue again, go it, margins. to we’re at able back look you us it to gives normalized of confidence that to when going be level to So more

the stages in for the project. campaign, pushed it’s and It’s installation projects headwind When fact the pushed up question, the any some of have – – the has we Now cases, this out of it naturally that rescheduling in XXXX. that out that occurred, or we would it’s – us, is projects. iEPCI one the but that the your I Subsea of benefit latter into of out pushed out XXXX headwind in certainly, several, one backlog point some iEPCI come as didn’t having

one fleet the the economic based the and in will we and impact the economic strong orders that’s XXXX have. and, originally fleet utilization again, have be the utilization, were That the we in headwind would that, XXXX. dissipated would that for – XXXX had basically expecting So upon low largely the what

of I The backlog’s it’s forward, when But resilient. backlog’s balance. So, the think strong. kind you – you a look

We’re a large have portion getting the new certainly market. orders total and very of

not the have alliance It new may script, add to come so in across partners. continue repeat I’ll We it.

new exclusive iEPCI partner, We alliance about the to player in space. are Subsea serious announce a a

environment. bring So, moving to things allow We the future dissipate, the direction. a will to regards know to normalized right the We more COVID in in back to obviously have don’t impact get the are pandemic. what

accretive that installation XXXX have have the a that fleet the to But be of there’s all continue of in to have more constructive will we you, that which benefit the headwind. real direction in move means realizing XXXX and we’re we of consider the So Sean. to also likely terms the bit helps that and recovery in going is XXXX. a more versus of latter the margins. to of to be But the in would I been forward now cautious. part hope Subsea – And

about building Doug. feedback. similar blocks Maybe, that just helpful, very Technip Energies, could just have I around thinking That’s we into appreciate discussion a next year.

likely So year-on-year off headwind margins. this for is a in Yamal case, roll

headwind, looks for still than for starting projects coverage But least at Subsea. new revenue That’s likely secure XXXX. more another big Some up. maybe

degree. So that some probably helps to

in than margins was downstream being sweet lower level. confident in a but curious are Yamal staying the part still Just bigger mix, stay that to underlying terms you how of but perhaps able of above spot when that

type in somewhere the range. perhaps high single-digit So of

Yamal very that Well, is have I’ll provide of not projects a do we us it Sure. over large portfolio to And pass And yet. other more as to Catherine well. color. important to are

very Thank you. to Because blocks Yes, much. building also thank described the Subsea, I you you well. have say, very similarly to

going of lot at USD end which XX.X of revenue very next we to year. as indeed, and a QX, know, So strong revenue have, billion is generate, you the backlog, very, strong

of will results in year. In our which revenue, terms Yamal of mix, the step we’re obviously down expecting you’ve it EBITDA a described next well, aggregate affect

the from a remaining accumulated other our in approach. of the been On backlog hand, very has selective portfolio the

we’re we’re know, way, in far sure we selective we you very choose, involving. and we the As the make project and the very are prospect in in

side reducing in see that And a portfolio. backlog very gross that that next Yamal. our year is in So you ex sound will margin

we’ve that execution demonstrating. demonstrated we the are with linked much very that So

LNG We’ll from is consistent sure, is a It obviously for well. associated X strong, which profile going will margin that consistent for It’s in to continue take You say, to have normalize, to ramp that have prudent overall, to recognition. that delivering very year account we phase, can with that you’re But We’ll to margin mix into expect early Artic expect Yamal. EBITDA. the with be I continue up. progressing change well. next would in very understanding

That’s very Catherine. helpful. That’s

welcome. You’re

from Hallead Our question the comes Kurt line of RBC. next from

open. is line Your

Hi, good morning.

Kurt. morning, Good

Hi. My initial the provided was follow-up guidance Maryann full question for flow on year. is for that cash free the

Yamal going already clarity on of cash free the Just are embed payments to flow that get expected $XXX JV that go the some that. to Does partners? million wanted to

Hey, Kurt.

cash free So, that Yamal payment of flow, actually fall cash that below see section the you flow. the financing in

milestones project answer is because question. flow year and short But in our Hope the fall does progress free cash we expectation, for is inbounds your include, addresses projects half no. there and the unwinds. as obviously, So the other assumptions it payment That it outlined. of as not that doesn’t back around

of Energies. Yes. to for for Subsea as all-electric-powered especially and the That about Technip aroused it my commentary initiatives as the respect as Technip Energies, green commentary curiosity you the Doug, strategic Subsea your to and with your And around relates does well hydrogen system then definitely some blue help.

next, impact specifically don’t within for year traction for what to know you I have of what course just I’m the momentum those to FDI can going kind XX for for and kind or wondering get the of specifically initiatives? time know, to you do way you within think too see within period And that techniques, the six I But months. financial early this So two. it’s a be of next building

Kurt. Well,

versus, want are we very not of the A have of are on of are returns those the You in – key momentum in some the renewable say, And the renewable obvious space. focus some would that commoditized returns we ones. I we lot space, in parts associated if although we you terms other really terms and two differentiation the certainly across space. on their obvious participants in attractive can touched of can not renewable initiatives, will, more of provide the the to and where of

design been required we ones. attributes providing of the really is lot working very the momentum it’s much which technologies amount very the which tremendous infrastructure see this. are key of do are on Subsea a are It’s enthusiasm time. I a we is unique. here, on And touched to it’s and to and and and the but be is So completions there say big subject. very, opportunity. you really, able the the how electrification positioned of there’s electricity, offshore, it, uniquely would two And that period interfaces the a not simply and equipment We’ve with the of on this that the a the for because

become attractive reach this that. have And an a can we and for We’re as this is partnering clients we with those stated ambitions. believe for partner space, others that environmental key will could be example do how them and our them in opportunity this of ambitions they a help very we well

be wind renewable well that of and positioned that We’re not gives This looking experience where but one very in being lot we’re a a able and be space floating floating in clients. provide space. beyond wind, example, to solution And and electrification, our offshore this of knowledge electrification could a the actually as in farm necessarily through from involved this lot to an just very the energy. offshore we’re is first very of our unique to the us experience at credibility looking and

and energy let potential to microphone a I’m about that. point bit of area talk as about hydrogen. source could and out, Catherine in going the the very excited her we’re our pass you to be Another vast experience hydrogen,

many, a these The such And nice days. thing energy – Yes, sure. extremely the hydrogen excited role that the you being believe are future energy many a Thank pivotal Kurt. to momentum carrier, we question. in play Obviously, different you call installed XX mix people applications. thank for we've plants thanks, by not the gray blue also hydrogen going the clean that. around this XX was is we for – do units XXX for hydrogen we've also what hydrogen us hydrogen. And is know We've world. actually and much obviously, called in We But years. is might pretty – across world. that this been built around We've the

a So we differentiated have proprietary unit. very offering steam reformer with a

that capabilities with special help have We reduce COX some emissions. equipment

a references of have experience. technology we and So lot

In addition, carbon we capture. have a technology on partnership

you projection, course, and hydrogen. the which clean combine about So so from all when you hydrogen you of the proposition, green blue look comes hydrogen at be understand exciting projection need. will when why is excited the And pure the if demand the that, And are hydrogen, in you prospects like, there hydrogen. most we of

is a commercial today hydrogen, is However, the we the commercially can today. with something room provide which the blue of economics and the does can leave equation gray which that carbon hydrogen for capture, – lot

So that's today. for exciting, a very us strong position

at you hydrogen, green it's the If look a more obviously, emerging. little bit

excited industrial are about the potential of also the We and capability units integrating hydrogen green at scale.

this industry, from our in large integrator, hydrogen, useful So economics be will which role for integration think skill will that project very helping benefit the work. we of management as an project green making

hydrogen, Technip So matter we to look, big what in you has Energies, play. role you look a indeed, think where no

by So starting way. that's now, and exciting, the very it's

Doug. you, to back So

that. for that you Appreciate Thank color.

Instructions] Markets. the Capital [Operator last of Waqar question Syed comes Our from line from ATB

Your line open. is

question. my taking for Thanks

exciting the and stories? a And transition from you're hydrogen Number your what say aspect you energy all emerging the Would most energy that these is revenue, about talked working transition is right percentage of within two, You've green contribution ideas. ideas other hydrogen or as now number the and – different the that one. on?

Sure.

the again, very time. most the it get be very we would an constructive that exciting. space, returns, zero-emission could Actually, renewables the for have believe is differentiation you can of I'll create the most hydrogen, because talking and very, running that or us, to the say, the follow of production exciting I we're at we question. we of to and I this in subject differentiation lot are is is type which thank obviously, the that much, returns the the poor. as about is not And large, on. significant. a When hydrogen be impactful. space, that's renewable to are very opposed of the is award yes, We're and So as look quite about exciting we going you of but to brief projects And and on. want out I know numbers And focus offshore, appreciate electrification up

So an development driving active push we and joined we're voice to to going We the in active the want doing and help Council, and really keep just Hydrogen to an our and be areas. advocate part. those

it. through total question The into LNG a energy In the to transition look and dynamics terms a a certainly able of commodity a has we ability impact have as fungible LNG. it we time you percentage of be fuel, to make critical It at all very don't the is, contribution, certainly probably the do enough get significant do. of to

If you a large include LNG, it's percentage.

well. our secure look If pivoting strongly to company the future pure of you we're a this and direction at securing as you. portion all exclude but hydrocarbon and just the renewables, it's today, Thank smaller in

in can, one – talked That's business Thanks. are into If those you I maybe you that Where in just last in technology segment? digital Energies Technip The question. progression the of the or that the that last business. ideas year. solution introducing digitization – something about

Sure.

to and company highlighted just this to the and our drive we're – develop looking if life really, So through will, become, across project. processes. the front-end bit quickly. initial last you the Subsea engineering. beyond from we're evidence highlighted the really of Studio. expand very greater, board, more couple going of front of the the be last the of is way digitalization internal that at even digitally wedge Subsea seeing We a quarters It's of This external our field quarter quarter going the the introduced differentiation significant. It's way all the actually It end processes, will will

the is conclude We'll greenhouse really, impact continuing fully Technologies, we're as things well. Catherine, That there's exciting that I'll today's system let on well the terms to you quite moving digital, digital be So area digitized talking In the completions. has a by we others has a to forward. to And benefit a again, come for and you more in it a within of Energies. from transformation to also of the Technip being but natural and a emissions call subject. lot as go the benefits Surface gas bit about of communicate

optimized Doug. of on Thank we very particularly which similarly, some to And the deployed particularly digital development designed our well be and technologies around for around and Technip much, assessment ultra-front progressing in are on tool, very you need carbon twin, you Energies, end game-changing allows in digital, customers. particularly tool,

a of we much looking and game-changing series that forward good Thank the have much. So we to will you more very be very solutions talking future. in

now I like remarks. would for turn Matt the to over closing to call Seinsheimer

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

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