TechnipFMC (FTI) 23 Feb 232022 Q4 Earnings call transcript

Thank you for holding, and welcome everyone to the TechnipFMC Fourth Quarter 2022 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. [Operator Instructions] Thank you.

I will now turn the call over to Matt Seinsheimer, Senior Vice President, Investor Relations and Corporate Development. Mr. ahead. go please Seinsheimer,

Good quarter good XXXX Jack. to and TechnipFMC’s fourth earnings morning you, afternoon, and welcome Thank conference call.

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

differ on actual statements and from are beliefs subject statements. materially certain current risks and results business assumptions or these forward-looking these our and they Although regarding that conditions, cause could uncertainties to are based in by expressed expectations, future developments those to implied

Known are wish on forward-looking undue statements, differ forward-looking with hereof. recent any undertake filings material or no factors of caution speak or information, to future after to as that XX-Q in statements could are otherwise. most cause to periodic of result We the our whether other the actual We events you not only U.S. revise from results any projected our to and reliance XX-K, update they as Securities publicly our most a made, obligation and of our place recent described new the Commission. date which results date Exchange

call Chief Doug over turn TechnipFMC’s Chair Pferdehirt, and I now will Executive the Officer. to

of the growth we Subsea continued and in Inbound in we XXXX. full And The multiyear Thank XXXX. call. growth the resulted XX% our midst our at billion by fourth are which growth strength backlog versus year. further for for we to Subsea prior a It as we by you, grew quarter inbound in cycle XX% across evidenced growth is Matt. you $X.X XX% anticipate a of increased driven year inbound morning discuss to Thank of company in good the the will moment, billion, $X.X orders in the billion, year-end. earnings Good as afternoon. participating in experienced clear in that $X.X

$X.X XX% of grew in year. of in improved $XXX billion, adjusted the and EBITDA million while increase financial our third. reflect year, metric improved to to position. and In for These the We X% our year compared adjusted company on strong operating full to million demonstrate nearly total to when when the deliver and segments prior For was revenue also commitment nearly XXXX, both margin results an one our the continued improvement objectives. operations revenue impact generated exchange, continuing the flow reduced by cash materially same $XXX excluding of in EBITDA we gross debt financial from foreign free

intention At XXXX, Day distributions announced our the in we half our Analyst XXXX. in to second begin of shareholder

authorization our by million the Given put $XXX the the and plan valuation a repurchased opportunity with progress our a shares in of made debt, full our we in by action We share we XX in in million significant months accelerated the program buyback the shares reducing line time and saw steady $XXX year-end. July. outstanding of immediately

in this second We we a committed also to quarterly which dividend, the remain half intend of year. initiate to

of and outside strength defined are levered and advantage this cycle of the full and offshore lead believe generated positioned many of leg that America as geographically international positions International will have is is revenue North More growth important the XXXX, uniquely we that up to take of XX% to these East markets market, expansion. remain the growth. than our be leading next largely we markets. this land continue beyond of in TechnipFMC can Middle and Looking confident to the

Focusing first offshore. on

has of project represent XX nearly potential customer all activity. basins. grown offshore by record Our average over this an $XXX base level a months, continues amongst Subsea which projects activity opportunities greenfield in award large highlights list potential list, momentum million, The the project larger expanding major next to in for to with driven size the on

In these many we markets, of such direct in to awarded to which continue company. Mexico, are visible as major Africa, tieback the our Sea activity strong forecast the more opportunities, West North addition and to Gulf of

several commercial quarter, $X These totaling growing very billion who highlights the Norway. are We BP’s benefits for have first our project, for projects a award announced the start solid the High first Development direct choosing award clients, of in list model. iEPCI This the a of Aker include integrated Utsira further to year. the

further continues a XXXX, base We to of in direct the iEPCI our expect as more of awards grow, awards. total When we XXXX. our services increase a increase a are leading in Subsea And activity. material see awards, year Subsea integrated iEPCI services and than value XX% inbound project expect we in in forecasting record to represent taken together, installed to for to

Middle While East. we the growth, expect continue revenue strengthening likely be primary to the also in offshore in particularly investment activity our of driver land-based resources, is significant to

our have position Arab Kingdom Saudi to further our expanded we markets United the and in the Arabia. we footprint talent as market a and such strong have Here in-country of Emirates leverage

ten-year have to and services. trees Dhabi agreement on associated our Abu wellheads, commenced framework with provide We work Company National Oil

and completed expansion Arabia, part of Total our capable In-Kingdom Value local and Saudi develop commitment the in manufacturing program to also will a XXXX. of We Saudi our Aramco’s workforce Vision which capabilities support Add diverse as

opportunities the Middle largest the decade. believe this East represents We market one of to continue

impacts midpoint for XX% least exceed will follows the an at Let prior summarized best we billion, range. as but guidance using can company me of increase in how outlook the year. inbound orders to remarks, versus In XXXX, headlines year XXXX $X our details of now expect Subsea this his discuss provide and more be the Alf for beyond. market our view full

we In addition see project Subsea $X.X strong pipeline, inbound increasing the to billion. services to

of line We anticipate both of $X.X top prior XX% We similar revenue. to increase Moving for versus total results the approximately year. billion, anticipate growth an segments. company

represented just we over half which growth markets, of to the However, in expect total all segment international Surface come of Technologies nearly the XXXX. in from

Alf call for to Before context let me prior I turn specific forecast. changes, provide first material the to discuss these our to revisions the over

upside One key in in Analyst including at efficiency, stronger inflection that operating today, for topics was increased margins. services. transition model, contribution of drivers place vessels, increased still XXXX potential at Subsea the to we in utilization are time the margin, backlog outlined a operating and the an plants the The primary our configure-to-order Day Subsea from of and

clear volume find we to partner to toward also greater security. as partners in of environment a resource However, a on ourselves different The selectivity. strength customer development. led project work energy more new alliance our one collaborative will reflects even the be very has today environment, market to a that of This focus of leads and increased relationships, those of particularly prove greater our value approach

well on greater X.X that create suited importantly, company terms to where are and on budget. and and Subsea value with outcome. customers also seen see deliver the this capabilities a but in industrialization unmatched provider time create in environment. efficiencies has for that will ongoing They again of greater differentiation, iEPCI working within also have over in value on greater The the projects are even and We certainty and contract result ability they demonstrated time. initiatives focused our technology TechnipFMC likely of by conditions, more alignment comprehensive supported time and

on outlook financial in and performance. we our summary, We a having market many XXXX targeted delivered strong XXXX notable further achievements. closed a step-up In enter with

Most Our view. XXXX can Subsea expect importantly, we reflects mark this, the to value marketplace, with And significant of we rather the improved $XX on We revised more major XXXX company. endpoint, bring milestone billion does encompasses our our business. XXXX on see the a most It operational progress through current not to inbound our the path XXXX our and for environment, outlook financial momentum expect within we will ahead. improved now the journey returns. but demonstrate ambitious a much

now will the to I over Alf. turn call

quarter was $X.X period Total quarter. of to company increase sequentially in versus in quarter at in billion, $XXX charges loss full EBITDA continuing Doug. million, $XX it share, $XXX or billion of was operations, full billion orders an the Technologies per year inbound were revenue $X $X.XX with loss Total loss. of company X% after-tax with excluded $X.X which Total billion. when $X.X Surface million was backlog inbound and year adjusted foreign increased $X.X exchange million billion, exchange XX% from billion. $XX fourth the The $X.X excluding putting company a included million of the Thanks, inbound foreign $X.X was prior of adjusted the year. orders inbound million. Subsea the

quarter. the to guidance $XX us flow free delivered both For allowing our at year flow we of million, operations the full expectations million and $XXX year. just cash Cash capital in the beginning expenditures achieve segments, quarter, million of that $XXX were was from the we results continuing in the exceeded over resulting for provided

of For and flow reduction debt equivalents the We million the with the of quarter full third a year, from free $XXX was $X.X billion. million. was $XXX quarter. was cash cash $XXX Net ended million, which cash

year, me This of million. close. just we share to let in quarter, means shareholder completed distributions. that the to shares $XXX million five below for full still price flow our shareholders, free last strength. we the average distributed while over months. improving We XX% In to program our Now amounting we night’s $XX financial fourth just repurchased year the cash our repurchased shares of And full turn total to have XX% that XX% bringing an repurchase is at

shareholders, XXXX, represent and fully shares committed continue in As we we value. to we demonstrated to believe have attractive our cash to returning that are

is Let will spoke translate remarks, company growth. for and the This that and his the our XXXX breadth our tailwind for that – further in financial yet to we results guidance. we of me beyond. Doug to expect stronger now another outlook will move strength into prepared In order market

won’t our provided We time. item year fiscal for guidance each speak the release. have to earnings current I this at in detailed

will QX our context few a expectations provide I around for items, results. including However,

for services. range, in Let in At a of of growth billion EBITDA growth XX% also guidance revenue me XX%, This results year. we which at of our margin assumes begin anticipate the the with adjusted full Subsea continued of Subsea. $X.X midpoint

impacts reflect of with first results. revenue should continue and essentially drives revenue a line margin year activity. quarters the QX second and both with that the Conversely, quarters and vessel-based both of which activity, fourth third this higher. Subsea in experienced the first and and As uplift from services quarter, Subsea, typically seasonality to a seasonality In benefit weather-related each reminder, in seasonal negatively our margin, installation results

For Surface a billion prior range, will almost We the markets. EBITDA adjusted margin resulting guidance anticipate entirely of revenue Technologies, XX% nearly XX%, be of we in midpoint growth growth of driven our year anticipate the international at full versus by revenue $X.XXX at of year.

United international in revenue year result in the growth first half Arabia in approximately should Our Arab the Emirates over the continued of ramp-up activity and Saudi XX%. of

lines across estimate product impacted region, segment Our percentage results be growth impact approximately total revenue by eliminate which negatively to American we underperforming the by XXXX. and will taken North in actions locations X points will

on we importantly, these a favorable will expect actions profitability. impact More have

Looking XX% expect at the revenue the total we fourth decremental with quarter, versus sequentially, EBITDA approximately decline by segment XX% approximately margins to of quarter. first

of Beyond is X% to XX% of guiding we well the year segments, $XXX million, conversion for capital improved revenue. EBITDA $XXX as a year, year the cash the over full $XXX And which just of flow to reflecting the finally, higher anticipate the million of cash. as EBITDA above to range prior more expenditures than we of million, free midpoint are

Inbound the that XXXX. now orders at Day. orders billion approximately update Within want from inbound an approximately provided we services through include our intermediate-term $XX to see billion would in Subsea give XXXX. $X.XX Subsea, on we I totaling of financial following the outlook Analyst for This XXXX XXXX. Now,

Revenue billion margin and of adjusted XX%. approximately $X EBITDA of approximately

cash provided expect XXX unchanged. comparing in flow to items guidance free other All our our convert adjusted three total result and of company remain expansion in of $X.X XX% When would subsea EBITDA just in XXXX Subsea Additionally, in a billion. revised framework this EBITDA previously this margin outlook pertaining outlook we results, approximately to EBITDA Subsea XXXX years be and normalized to point XXXX. basis into

percentage evolve to Our revenue mix financial expected a also years. have of project chart XXXX performance in in total scheduled few that a outlines presentation, of included the call will we In and next revenue current our XXXX. current backlog earnings both over that from continue view our XXXX a reflects as the

our XX% existing come For will from of anticipate XXXX, we backlog. revenue

number that to is XXXX, For closer XX%.

takeaway in of much this margin would inbound the our that the also that The any of year point key layering services before market are out of is backlog one I that projects inflection over current and here was inbound reflects environment. messages time. the EBITDA

negatively be margin that EBITDA Subsea. to XX% margin the We in XXXX. will by And impacted even are XXXX the upside highest not for that remain importantly, As is we suggesting the chart, beyond we this can implied anticipate XX% more legacy by still there is achieve backlog. number project we confident

takeaways. with I closing, share will In you my key

First, total company important the for notably we delivered our as targets as most flow. commitments for year, well financial Surface and Subsea the free on profitability Technologies cash

for and in initiated higher of than cash Second, guidance range we expansion demonstrates midpoint XXXX the that year. have a margin prior level of conversion the flow at

accelerated have shareholders to we million shares continue plans XXXX. repurchased Third, our distribute cash in in intend the XXXX, our to $XXX we of buyback and we program to

also initiate second a dividend year. to half of have reaffirmed our the We intention this in

back envisioned our XXXX. current for have of that multiyear finally, And is intermediate to outlook the updated than cycle more term we had impact robust XXXX the in we reflect

ability offshore returns our and further Middle company. East our to Our and cycle, the drivers the improve the this economic markets leverage to of key of

open Operator, now questions. the you for line may

Instructions] [Operator with David Anderson Certainly. Barclays.

line is open. Your

Doug. Hey to must your from put fall pocket A It three of when years visibility good we have morning out those nice big the guides. be interim in back XXXX now. of change

bit. wondering into primarily a the more you in in XXXX. the was of kind of if what of little I could function about really this drove Is it a bit talked of guide dig You kind expansion margin Subsea kind a little

of higher of you’re modular the your model? the iEPCI saying about and also there. leverage in I’m awards or that’s of You today configured-to-order – assuming think throughput XX%

think think you from of is XX% revenue the that backlog I in we or backlog XXXX XXXX said about XX% And backlog of touched then I it on secondarily, in today. just

these the of components in kind kind Thanks. is just So that, projects? you just me some pricing behind this on factoring maybe can Or understand please? of of help

to our start, clients embarked Dave. we reflect to we if on model. while offshore – investment years fundamentally of maybe our ago, changing the Sure, got journey energy how back Good morning. for make development, on here, we It’s operating six a choice

We experiencing a are journey, and a of few the of results combination that now that’s things.

adoption the Subsea inbound XX% had of we and First X.X. previously XXXX, to years. and market expected is of that now we approximately expanding the X.X our that We see in and even foremost in coming Subsea XXXX be said further

keep not But in plant that through today. mind, inbound is the of flowing all

in to our a years, configure-to-order great go significant model modular obviously what X.X to actually operating less the to if ability we So to confidence to we or be able as look as it’s demonstrate to continues result which the of at shift delivering coming than efficiency which our and what us our to the model. of This build bit a as Subsea today, our operating deliveries, to we’re will XX% gives you towards referred refer profitability. benefits XX%

that’s on future at that we’re company not that I Those award work of I times, we’re work, the years, iEPCI. up the The we awards which opportunity sets That the projects engineering in of way, ever increase. lead set at pointed work iEPCI, design FEED out, year call to the it’s that then look iFEED that iFEED, and available X.X. iEPCI, will is in We that adoption record at emphasize which iEPCI an is rest all-time doing, And the And the stated continue is percent a market. addition, our which many as not for front-end level the highest when also, include is And proprietary is by of Subsea high. that to the be to we you been. iEPCI. for the a this the FEED to direct doing also

that that basis change, today, So that pricing it’s market create additional focus benefits we points things, the a these material look that currently gives from – that on margin, the to the we for sustainable a are Subsea beholding these further are great been working where improvement of when from energy we’re not seeing guidance. us updated on XXXX XXXX we’ve security, But we just an to and achieve clearly, the at half of now we updated confidence. guidance decade XXX these and combination it’s increase of a factors

guess that years, or you that kind the in this the the whatnot. about XXXX type, does industry structure terms billion last of your analogy huge about on of we years, next this look you it how projects, changed the to different as visibility the customer like next when the kind I a talked next you been I IOC book XXXX three out think the in has at of think in cycle. coming I’m So, just kind is cycle compare something Maybe obviously, when over just that the three was $XX when of visibility didn’t market this had order looks the XXXX, what on like with much I orders [ph] and trying to for prior guess And of size three curious what exist XXXX. business. about you about how about say, Aker in as of the really there’s years? of, talk Can this the is, kind of that Subsea just

the we this – talk this all Dave, about time.

and was billion, of I chain volume, supply a morning about research, $XX who terms organization to manufacturing just we’ve both when our the question. fundamental never of you cycles, experienced visibility, point but our engineering, the prior to before. this matter by As The this. which and this the talking change the fact, – to your way, the runs gentleman is in

customers the we’ve to us to actually point on months that right career. it’s direct deliver that this experienced, out, right seen XX more delivery And that planning so always and seen what’s take award fundamentally on that’s my very never can even our what to would to was projects, clients this planning a that continue our robust we’ve And that not the always with on-time we’ve months, our projects time And even I’ll continue that Dave. growth significant to, But I’ve budget. XX performance. we makes us to in we taken cycle, changed, deterioration now, in are have ensure as horizon, resources a the comfortable you which have work. expect had on We really we and projects

They only our but project. us the this current They security, are also supply in And period in booking project, projects, trust now and our and of not booking well energy they iEPCI greenfield want not not want on focusing to greenfield that’s had we customers deliver. previously. security, but Our X.X. capacity visibility greenfield want They just advance our future capacity. the have they’re and

last in orders? before you smaller IOCs. Are XX – cycle? here. think one year’s Is Sorry had all of something for We squeeze more to the half than continuing you of about to you that broadening in cycle Are like see the by base? that different dominated customer that last last starting is Are these companies said you the shift? think question seeing think you kind customers of first that I

to future some most they actually established secure their capacity the I of Sorry, to of for and the to expand Indeed, it’s actually have on we’ve capacity be the some but both our discussion – earlier new projects. – that who largest clients clients, customer also are focused the was having ensuring I’ll but XX, that unique brief. now applies seen over also

Appreciated. Doug. lot, a Thanks

with Arun JPMorgan. Jayaram

Your line open. is

November as sausage I longer-term significant can terms years. XXXX. know, how you in what could somewhat good us investors pretty Doug, about give what long-term you I up in you of questioning confidence sense looks give been if the a achieve wondering over thoughtful really the But follow just energy in skeptical been you have the but guys talk to to of a know XXXX? of of was I was told you made line us forecast, just on guidance, morning. us wanted Doug, and the of to that David’s versus Yes, outlook have maybe be upgrade

morning. Good Arun. Sure,

of reputation extremely We’re think have a – conservative. being I

visibility exceeding also be have about view talk took of question. we achieving my same our What a mean, the And has quite clearly the our it’s And is whatever in I approach. when be. may or particularly it to or hasn’t our response the changed. to reputation Arun. capacity, the changed or forecast guidance, earlier – our whatever unique, We tree market, approach to earlier the we it of guidance the inbound

studies, opportunity that you will, we’re kind our of list doing projects to call like kind on doing a giving you partners have company And This not see from you you Subsea on relying opportunity integrated on your the so award projects you’re there’s alliance a company, to-be-found services, those that projects, amount you in significantly will they’re we’re which have not or your is where forecast, a increasing set certain going you do not And have is you do call-offs and/or projects big, see project your to-be-found guidance. is know we they this would when Subsea bucket, named when achieve that tiebacks. have FEED our what field the if direct of which, list proprietary for FID. you a then which a Subsea by a to when rejuvenation, the importantly, brownfield a way, a of of result more we’re

you plans billion outlook I guided would push future about or EBITDA of cash million of cash an flow. driving That’s where expect cash that? is on super talk And it follow-up to about you could conversion the if I call wondering $XXX mean the adjusted My maybe $X.X just XXXX towards was increase for XX%, in flow, provided update helpful. what free you’ve just free for that to is you

call no a – this the debt net You net a, at debt of have end guys will it, year.

just thoughts free drivers the future flow that uses of get and to that your wanted cash I So, of on the

flow conversion cash free stronger rate.

a No, XXXX. thanks way question. for very simple the with in And start let’s for it maybe

flow some and of about? pace And even into and free other talk that what than cash going about those the the goes EBITDA I are are statement. expense do grow I to We profitability growth. our items factors the same not at going expense, pace earnings like a All as corporate at talk grow things higher factors interest clearly to CapEx.

and with, get how number, that’s call XX% of that neutral for you combine capital if – a you that kind So to of in type roughly it, working XXXX. outlook

Great.

if in Then heard But in we we’re, like at of you couple ahead year. the the look what the where terms here obviously position our we lot, we you’ve happy – call. of with achieved are a as past comments from in first first and foremost, have

debt We Day reduced set at be cash and have achieved which achieved target of million said distribution million shareholder really $X.X out we our We the share largely of the $XXX buyback year. what billion the by really in acceleration over we position accomplish Analyst structure, to could program past that us $XXX in July. And was this we debt. capital here for through

dividend second committed already are Doug half. the in we the for as And said,

value to our our to flexibility retaining the That’s where say focus. going term, strong shareholders. the we’re to be return remain favorable at we position, buyback to maintaining, time, same look also have of you when a continue best this forecast, will this opportunity it’s delivering Now cash with to a – here short in the balance first we but sheet think to but at our the we And shareholder program, all, we committed in really to our be contribution. strong would of outlook going in obviously continue share light the that

Great. Thanks a lot.

Scott with Gruber Citigroup.

Your is line open.

morning. Yes. Good

Scott. morning, Good

less return years. step normal of I appetite given for that be think you next be a just on the business? the your and kind the which going curious, stay wanted guidance. just And be back, implies on about of should in the at just evolution price if the solid. of as Doug, just curious mid-teens, on given I’m taker is look XXXX capital about of integrated think your for portfolio you certainly to what evolution industry, should I’m I But looks what return the how few the forward. you model, the a to

we and It’s Indeed, with long taking welcome are to a actions the want great from was to that to and Scott, improve we company much a customers’ mid-teens And offshore at where at, cycle is improved same through-cycle looking for line as really today. return. we we’re embarked on our are a operating improvement while a what Subsea unique that I call. in this a six model journey would our emphasize in different the again, time, years well, returns just drive the substantial ago that question, return project peak creating not

our plans. of than a today as we flows expenditures we’re what are Subsea far it we’re of look less Subsea what the at would done efficiency so level integrated in that some our That’s have through also And company we the are But things deploying if additional doing, capital on you historical talked about average. and because X.X projects. of X.X the that of

also individuals being people a That’s suppliers we even compete cooperate it at of And well be as we’re time or our well us it’s with the and of development others. our be might other good as ecosystem it that’s really clients, – in our for as the But at We DNA us work partnering. with. against our at fleet. as times company,

continue So with fleet it those combined within and but working world-class are and to of market to are of own that we as well have the and ready fleet of capabilities able ourselves are to our as vessels, be overall couldn’t we are Saipem our We of fleet, have proud we Allseas success capabilities as our and enhance to continue willing also by more unique access together. to which we be many allows us partner outside to see like companies with and that. market we have grow others this the

the mentality, about, is just So being grow on opportunities Alf shareholder focusing that which around returns the we make sustainable it which talked returns cycle is being one through really and a able greater on investments focusing to much different that with really the create by in disciplined distributions.

say to fair mid-teens return. you’re Would satisfied it not it. that Is be fair? with a Got

just would same midpoint which under script, line the as is that of, my our in journey. my along on remarks was closing I only a the bucket throw this

a ambitious ahead. much more have journey We

the you. Thank Appreciate color, it. Got Doug.

Hallead Kurt with Benchmark.

Your line is open.

Hey Doug, how you? are

Kurt. Great, voice. to Good hear you

Yes. again. to be Good on

bar know and really be before you on some points Doug, XXXX data So and out views to again you raised for you people asking XXXX. are putting going the your for

what just okay? decision-making and ready No, So All so of First here a talk I’m performance delivery of element. kind you kind referenced for your kind your you through get customer foremost, kind of curious process, when that, as right. driving of key like drives,

You look and energy and down customers you how the factors of take how even developing of kind valuing And cost But that think, your those those has would components, And how maybe fields. couple how three delivery, evolved? right, rank security. to of energy the drive years? the of cost you changed, last conversations which these have are with three, element, one you of in the between offshore security kind I – continuing at do how mentioned those those when customer over

by and in security. our conversations, capacity or each an obviously some I supply I then are it’s to securing other. capacity, fundamentally if starts the them interchangeable had underscored obviously say order, security they’re But two put in energy actually it’s would somewhat but I first energy securing would security say dependent upon with it capacity, supplier

customers our complex some company, with execution amount arguably down trust reliable and confidence then a really significant they capital world spend. affordable to certainty are because comes energy the do of their of and putting to great ensure our most in And a and that complicated work supply. the has and that it

it’s by So just And humbled this to that. being be position. phenomenal by really in start we

you mode of award which customers. not is the And individual into in with humble. for approaching discussion, a of And then that go an a almost three our normal some when and direct decades companies, now remain in operation we honor we’ve for just it’s many cases, situation been

success. our Our client success is

we is stay the success, success on. what project’s Our focused and that’s

simplification, as do and deliver to and think we industrialization I continue around that And as what do. we can standardization we long

technology leading have provider. to You the be

it’s of company, what more and to intimate And terms to delivery, the part we you proven I unique to of that’s have relationships. have have to built be You be it. and do, in record trust have couldn’t and upon proud track our deep

color. that Appreciate Great. Okay.

obviously, business. So part attention lot the well of on spent of Subsea a the

on right? be of XX% East Middle XX% you’re You of see revenue And forward. from in your the curious the international So going what’s Surface, XXXX. growth I’m coming year mentioned to or bulk kind about going

So do long-term investment customers horizons. be long-term These these had think maybe all the could with who Where mix extrapolate international XXXX? come projects that. you have are

portion of you’re international mix Kurt, total Surface a asking the as Technologies? the

Yes. Yes.

to the Look, rig North over America term. long-term and modestly. a term, but Okay. the It’s grow the grow, hard of in North America don’t going period, it’s clearly, could with We grow materially. market not our activity view view it short market. have But the likely to see certainly is completions consensus, the short maybe which to that decline, in is is growing grow activity much

growth. much we’re not expecting So

the group. prepared grow my our in revenue from in Technologies the with of in to land mentioned of growth part come line I America the remarks, business, that terms international all growth Surface although from business year-over-year, Surface Subsea of North for the not we will of As part expect

Kurt, personalize the very, time in we’ve observing business And is. the opportunities our content customer, the local support in East. forward. meeting capabilities spent investment in Middle Aramco, a East. in pleasure the This demonstrate – of manufacturing key is We for results and that with path country. Kingdom. fully we’re very spending about our investment our bit and made that. excited our last increasing to the had week maybe the our where the the the focus little I And Middle and in in it I

Great. sneak of appreciate for and color. between, Maybe that of could if one you share about think that strategy say, guys shareholder as split dividends the you’re setting I How in second I more repurchase the on do the year? half this kind return.

seeing a are maybe to pursue. as to, we I we opportunity, said near valuable in remarks, our No. the still term, are shares allocation think still prepared we capital in our Kind as of alluded really

program. So about, the we half rather as but is us staying second talked but program accelerating buyback committed execute us share definitely, we don’t remain dividend that, the And most to really share near-term same with on. at to the the the setup with flexibility I buyback giving see time, the current

thanks for Okay. – guess that. I

about I to curious cash to was of $XX where about the free of I going allocate Or share going thinking how think just other question think you’re was you mix. you’re million dividend, your repo? my kind are that to to is return like, going XX% the of the share go to

this shareholder balancing and or don’t think is to our continuing the a us decision focused but have maintaining on specific returns. driving clearly, being that But year this yet are priority the yet. sheet, for get strong a balance to right, very our generating for manage we on I between we

great. That’s you. Thank

Instructions] Marc Cowen. with Bianchi [Operator

Your is open. line

would Hi, visibility thing have you that into this you outlook that asking maybe bottlenecks But have. are things lot in customers the like with that, some are providing? thank assets are that Certainly, you’re asked happen worth availability that you what around guess in what is industry for. topside you. other one instance, there have need monitoring, coincidence a I of to people on order for

Marc, for focus thanks question. constantly. it’s something Absolutely, the we Hey on

morning. differently But Look, is We would really execution I it As than manufacturing supply this historically. head in that have it our say we do. we mentioned, naive chain aren’t it conversation was to do it a we risks. risk, aren’t with there be well. I But done there do this what

when part the It late, to broadly over cost. you XX sold you mode of result months that XXX% And the industry, on were I’m delivered in a we when we I’m of speak the that, was the to were projects the and saw projects being industry, in. past, budgetary delivered and bespoke absolutely being manufacturing going say going

only the our now that Subsea XX% ago, that call to and We company are said, for up developing we now, is X.X I as orders. product of seven a new years started architecture

us to supply be our synchronized configure-to-order allows more model. with allows It much to go to also this This us chain.

So much as our suppliers partners. with chain. like They award way. the cases, our us supply do customers partners, that partners. I cases, talked about exclusive treat In earlier, the same our direct We we in many same exact many treat

drawing. same have wait with and have the So the to chain supply with engineering configure to with we don’t intimacy our – order, that on they an

every the past, you you a set – of only your drawings. part parts the part not X.X, way if – comes if don’t manufacturing. still manufacturing and/or and the for of have Can just that today. In Subsea that, it’s imagine but materials you’re machine single Every machine parts part with engineering rough to your of that raw parts own disruption causes for not and supply your single

have suppliers now can trickle-down it’s So they leader. effect. They know who the market trust we’re a It capacity. where us. we have know well works They extremely the we know

and delivery. obviously from their our and now, beneficial cadence, that a hugely planning on they drawing. actually XX on to forward to from the from beneficial months and it accelerated we it’s can own have to an have us XX and behalf don’t give extended said, We from with stocking we I cases, some engineering machining are In they now parts a a them capital to that as them working an months on-time wait orders it’s visibility, because and on flow

the the fundamentally without couldn’t architecture beginning configure-to-order today. to see of changed the it model this we’re develop really the but to it So X.X product our to benefits foresight company. done and We have just tenacity has reap

through the deliveries the but are not said, the of As coming plant that majority years. will over tree ramp X.X I our today, Subsea up flowing

don’t our great I you think results of Doug. a get of for improvement Alf the whatever things second quarter, SKUs progression with share hear the about the on free cash. how Thanks the had Great. if is quarter. more steer second out play I balance bit little just rate first And the but as of then in able quarter? guess be – one us the for first on you’re just help beyond Okay. could year, to just over It’d on about so that maybe we to we

Sure. Absolutely, we’ll do so.

the the had still $X.X it’s fourth in as you with had just start a flow a if quarter, billion had as flow we over us. advertising but start fourth is very the So we – for free generation quarter quarter big we cash strong planned, obviously cash with

said may in if to going Now flow we to you pattern follow very have generation. did and that, you the our having as year – to as us, generation cash followed a similar both cash but know, we’re free flow the in very particular, first XXXX, the where being XXXX, and quarter a in XXXX with of start we weak weak start very

that be just probably. year’s probably you going something And to look say neighborhood at results that penciling to and can last in it’s

business, So normal the and collections seasonality achievement we billings customer around into profile EBITDA quarters. the and we largely Subsea evolution it’s to and of associated then – tied the seasonal me and of that maybe that’s our for mentioned just revenue the the the milestones that and business we brings with Subsea some which have, the

now as we of low fourth in today. seasonal a said, season and quarter in right because are as quarter Subsea will we with type very we line much be, sit here

also any fourth bit of While quarter very second tail the the quarter see first but off a way pickup so to all – but little third should a we not the pickup quarter, quarter going a and revenue maybe in I that’s see really in the back margin be definitely will strong, the what in levels, Subsea.

ability will, driven of we ADNOC East more will is it the both quarter margin and Surface a kind after a of very But this improve revenue as in lower by in convert to Dhabi. will Doug little Middle And and Abu it Aramco and with it be in in our we said a with and little about quarters. orders, the Saudi strong quarter have more EBITDA. forward go an overall, contribution where think of I see different Arabia here as quarter. a both The revenue in uptick story bit a fourth we bit will activity

Surface a approach huge a And it – there, gradual. works up bit it, will from more to then be for more little a call to say there gradual keep overall, rather but than that stepping and step in up QX but how rather

it I’ll back. Thanks Super. much. so turn

closing remarks. for Mr. Seinsheimer call over turn to the now will I back

Time fourth call available concludes p.m. today. Greenwich on of This website approximately quarter X be call. replay will conference our the beginning A at Mean our

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call. today’s concludes This

may now disconnect. You