HOUSTON, Oct. 20, 2015 /PRNewswire/ -- FMC
Technologies, Inc. (NYSE:FTI) today reported third quarter 2015
revenue of $1.5 billion, down 22
percent from the prior-year quarter primarily due to the continued
decline in the North American land market that severely impacts our
Surface Technologies segment and the negative impact of the
strengthening U.S. dollar in our Subsea Technologies segment.
Diluted earnings per share were $0.35, which includes pre-tax impairment charges
of $60.2 million, or $0.20 per diluted share, and total Company
pre-tax business restructuring charges of $17.9 million, or $0.06 per diluted share.
Total inbound orders were $1.5
billion, including $1.0
billion in Subsea Technologies orders. Backlog for the
Company was $5.0 billion, including
Subsea Technologies backlog of $4.3
billion.
According to John Gremp, Chairman
and CEO of FMC Technologies, "The North American onshore market's
prolonged decline negatively impacted our company's financial
results. In response, we continued to take significant actions to
reduce our costs."
He added, "Our Subsea Technologies segment delivered strong
operating performance in the third quarter and we received two
major awards resulting in another quarter of more than $1.0 billion in orders."
"We achieved several critical milestones this quarter, not only
for our company, but for the industry. We reached an agreement with
Shell to provide our first subsea multiphase pump. We added Chevron
as the fifth operator in our joint industry program for
standardizing high pressure/high temperature subsea systems. And,
Forsys Subsea, our joint venture with Technip, received two
integrated front-end engineering studies. These are tangible
examples of how the industry is adopting standardization,
innovative technology, and new business models to improve deepwater
project economics," said Gremp.
Review of Operations – Third Quarter 2015
Subsea Technologies
Subsea Technologies third quarter revenue was $1.1 billion, down 16 percent from the prior-year
quarter due to the strength of the U.S. dollar. Excluding the
negative impact of the strong U.S. dollar, total revenue was down
less than four percent year-over-year.
Subsea Technologies operating profit decreased 16 percent from
the prior-year quarter to $170.7
million, primarily due to $14.6
million of business restructuring costs. Excluding the
negative impact of the strong U.S. dollar and the restructuring
charges incurred in the current quarter, total operating profit was
up approximately four percent year-over-year.
Subsea Technologies operating margins were 16.9 percent,
excluding the business restructuring charges.
Subsea Technologies inbound orders for the third quarter were
$1.0 billion. Backlog was
$4.3 billion, including a negative
quarterly impact of translation to backlog of $344.7 million.
Surface Technologies
Surface Technologies third quarter revenue was $361.0 million, down 35 percent from the
prior-year quarter due to much lower activity levels in the North
American market.
Surface Technologies reported an operating loss of $22.5 million, when including impairment charges
of $58.0 million primarily related to
our Surface Technologies' Canadian operations and restructuring
charges of $1.6 million related to
all businesses. The impaired Canadian assets are linked to the 2012
acquisition of Pure Energy Services Ltd. and due to the prolonged
decline in market activity.
Surface Technologies operating profit decreased 66 percent from
the prior-year quarter to $37.1
million, excluding impairment and restructuring charges. The
decrease was driven by the North American activity declines and
less favorable pricing.
Surface Technologies operating margins were 10.3 percent,
excluding the impairment and business restructuring charges.
Surface Technologies inbound orders for the third quarter were
$398.1 million. Backlog was
$495.0 million.
Energy Infrastructure
Energy Infrastructure third quarter revenue was $97.1 million, down 22 percent from the
prior-year quarter primarily due to further activity decreases in
our measurement solutions business.
Energy Infrastructure reported operating loss of $2.0 million compared to the prior year quarter
profit of $5.1 million. The loss
primarily resulted from reduced revenue and $1.7 million of additional business restructuring
charges.
Energy Infrastructure inbound orders for the third quarter were
$81.8 million and backlog was
$172.8 million.
Corporate Items
Corporate expense in the third quarter was $14.7 million, a decrease of $1.4 million from the prior-year quarter.
Other revenue and other expense, net, decreased $13.2 million from the prior-year quarter to
$21.9 million of expense, primarily
due to a $20.9 million charge related
to an intercompany foreign currency transaction in 2014.
The Company ended the quarter with net debt of $583.2 million. Net interest expense was
$8.1 million in the quarter.
The Company repurchased approximately 1.7 million shares of
common stock at an average cost of $33.95 per share in the quarter.
Depreciation and amortization for the third quarter was
$71.3 million and capital
expenditures were $49.8 million.
The Company recorded an effective tax rate of 19.2 percent for
the third quarter.
Summary and Outlook
FMC Technologies reported third quarter diluted earnings per
share of $0.61, excluding impairment
charges of $0.20 per diluted share
and business restructuring charges of $0.06 per diluted share.
The Company recorded Subsea Technologies revenue of $1.1 billion with margins of 16.9 percent,
excluding the business restructuring charges in the third
quarter.
Total inbound orders of $1.5
billion in the third quarter included $1.0 billion in Subsea Technologies orders.
The Company continues to expect at least $3 billion of Subsea Technologies awards in
2015.
The Company's backlog stands at $5.0
billion, including Subsea Technologies backlog of
$4.3 billion.
FMC Technologies, Inc. (NYSE: FTI) is the global market leader
in subsea systems and a leading provider of technologies and
services to the oil and gas industry. We help our customers
overcome their most difficult challenges, such as improving shale
and subsea infrastructures and operations to reduce cost, maintain
uptime, and maximize oil and gas recovery. Named by Forbes®
Magazine as one of the World's Most Innovative Companies in 2013,
the company has approximately 18,500 employees and operates 24
production facilities in 14 countries. Visit
www.fmctechnologies.com or follow us on Twitter @FMC_Tech for more
information.
This release contains "forward-looking statements" as defined in
the Private Securities Litigation Reform Act of 1995. The
words such as "expected," "continue," "outlook," and similar
expressions are intended to identify forward-looking statements,
which are generally not historical in nature. Such
forward-looking statements involve significant risks, uncertainties
and assumptions that could cause actual results to differ
materially from our historical experience and our present
expectations or projections. FMC Technologies cautions you not
to place undue reliance on any forward-looking statements, which
speak only as of the date hereof. Known material factors that
could cause actual results to differ materially from those
contemplated in the forward-looking statements include those set
forth in the Company's filings with the Securities and Exchange
Commission, including its Annual Report on Form 10-K, Quarterly
Reports on Form 10-Q and Current Reports on Form 8-K, as well as
the following: demand for our systems and services, which is
affected by changes in the price of, and demand for, crude oil and
natural gas in domestic and international markets; potential
liabilities arising out of the installation or use of our systems;
U.S. and international laws and regulations, including
environmental regulations, that may increase our costs, limit the
demand for our products and services or restrict our operations;
disruptions in the political, regulatory, economic and social
conditions of the foreign countries in which we conduct business;
fluctuations in currency markets worldwide; cost overruns that may
affect profit realized on our fixed price contracts; disruptions in
the timely delivery of our backlog and its effect on our future
sales, profitability, and our relationships with our customers; the
cumulative loss of major contracts or alliances; rising costs and
availability of raw materials; a failure of our information
technology infrastructure or any significant breach of security;
our ability to develop and implement new technologies and services,
as well as our ability to protect and maintain critical
intellectual property assets; the outcome of uninsured claims and
litigation against us; deterioration in future expected
profitability or cash flows and its effect on our goodwill;
continuing consolidation within our customers' industries and a
downgrade in the ratings of our debt could restrict our ability to
access the debt capital markets. FMC Technologies undertakes no
obligation to publicly update or revise any of its forward-looking
statements after the date they are made, whether as a result of new
information, future events or otherwise, except to the extent
required by law.
FMC Technologies, Inc. will conduct its fourth quarter 2015
conference call at 9:00 a.m. ET on
Wednesday, February 17, 2016.
The event will be available at
www.fmctechnologies.com. An archived audio replay
will be available after the event at the same website address.
In the event of a disruption of service or technical
difficulty during the call, information will be posted at
www.fmctechnologies.com/earnings.
FMC TECHNOLOGIES,
INC. AND CONSOLIDATED SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
|
(In millions
except per share amounts, unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
September
30
|
|
September
30
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
Revenue
|
$
|
1,545.0
|
$
|
1,976.7
|
$
|
4,935.4
|
$
|
5,786.4
|
Costs and
expenses
|
|
1,422.2
|
|
1,680.3
|
|
4,426.0
|
|
5,017.5
|
|
|
122.8
|
|
296.4
|
|
509.4
|
|
768.9
|
|
|
|
|
|
|
|
|
|
Gain on sale of
Material Handling Products
|
|
-
|
|
(1.3)
|
|
-
|
|
84.3
|
|
|
|
|
|
|
|
|
|
Other expense,
net
|
|
(12.7)
|
|
(26.5)
|
|
(34.1)
|
|
(29.2)
|
|
|
|
|
|
|
|
|
|
Income before net
interest expense and income taxes
|
|
110.1
|
|
268.6
|
|
475.3
|
|
824.0
|
Net interest
expense
|
|
(8.1)
|
|
(8.0)
|
|
(24.4)
|
|
(24.5)
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
|
102.0
|
|
260.6
|
|
450.9
|
|
799.5
|
Provision for income
taxes
|
|
19.5
|
|
90.1
|
|
112.3
|
|
264.8
|
|
|
|
|
|
|
|
|
|
Net income
|
|
82.5
|
|
170.5
|
|
338.6
|
|
534.7
|
Net income
attributable to noncontrolling interests
|
|
(0.5)
|
|
(0.7)
|
|
(1.1)
|
|
(3.4)
|
|
|
|
|
|
|
|
|
|
Net income
attributable to FMC Technologies, Inc.
|
$
|
82.0
|
$
|
169.8
|
$
|
337.5
|
$
|
531.3
|
|
|
|
|
|
|
|
|
|
Earnings per share
attributable to FMC Technologies, Inc.:
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.36
|
$
|
0.72
|
$
|
1.46
|
$
|
2.24
|
Diluted
|
$
|
0.35
|
$
|
0.72
|
$
|
1.45
|
$
|
2.24
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
230.2
|
|
236.4
|
|
231.6
|
|
236.8
|
Diluted
|
|
231.0
|
|
237.0
|
|
232.5
|
|
237.3
|
FMC TECHNOLOGIES,
INC. AND CONSOLIDATED SUBSIDIARIES
|
BUSINESS SEGMENT
DATA
|
(Unaudited and in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
Nine Months
Ended
|
|
|
September
30
|
|
|
September
30
|
|
|
2015
|
|
2014
|
|
|
2015
|
|
2014
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsea
Technologies
|
$
|
1,093.7
|
$
|
1,300.4
|
|
$
|
3,490.3
|
$
|
3,831.0
|
Surface
Technologies
|
|
361.0
|
|
556.0
|
|
|
1,170.6
|
|
1,546.4
|
Energy
Infrastructure
|
|
97.1
|
|
124.9
|
|
|
299.4
|
|
419.6
|
Other revenue (1) and
intercompany eliminations
|
|
(6.8)
|
|
(4.6)
|
|
|
(24.9)
|
|
(10.6)
|
|
$
|
1,545.0
|
$
|
1,976.7
|
|
$
|
4,935.4
|
$
|
5,786.4
|
|
|
|
|
|
|
|
|
|
|
Income before
income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment operating
profit
|
|
|
|
|
|
|
|
|
|
Subsea
Technologies
|
$
|
170.7
|
$
|
204.4
|
|
$
|
522.9
|
$
|
539.8
|
Surface
Technologies
|
|
(22.5)
|
|
109.5
|
|
|
67.9
|
|
276.6
|
Energy
Infrastructure
|
|
(2.0)
|
|
5.1
|
|
|
6.2
|
|
38.8
|
Intercompany
eliminations
|
|
-
|
|
0.1
|
|
|
-
|
|
-
|
Total segment
operating profit
|
|
146.2
|
|
319.1
|
|
|
597.0
|
|
855.2
|
|
|
|
|
|
|
|
|
|
|
Corporate
items
|
|
|
|
|
|
|
|
|
|
Corporate expense
(2)
|
|
(14.7)
|
|
(16.1)
|
|
|
(45.0)
|
|
(47.8)
|
Other revenue (1) and
other expense, net (3)
|
|
(21.9)
|
|
(35.1)
|
|
|
(77.8)
|
|
13.2
|
Net interest
expense
|
|
(8.1)
|
|
(8.0)
|
|
|
(24.4)
|
|
(24.5)
|
Total corporate
items
|
|
(44.7)
|
|
(59.2)
|
|
|
(147.2)
|
|
(59.1)
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes attributable to FMC
Technologies, Inc. (4)
|
|
|
|
|
|
|
|
|
|
$
|
101.5
|
$
|
259.9
|
|
$
|
449.8
|
$
|
796.1
|
|
|
(1)
|
Other revenue
comprises certain unrealized gains and losses on derivative
instruments related to unexecuted sales contracts.
|
(2)
|
Corporate expense
primarily includes corporate staff expenses.
|
(3)
|
Other expense, net,
generally includes stock-based compensation, other employee
benefits, LIFO adjustments, certain foreign exchange gains and
losses, and the impact of unusual or strategic transactions not
representative of segment operations.
|
(4)
|
Excludes amounts
attributable to noncontrolling interests.
|
FMC TECHNOLOGIES,
INC. AND CONSOLIDATED SUBSIDIARIES
|
BUSINESS SEGMENT
DATA
|
(Unaudited and in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
September
30
|
|
September
30
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Inbound
Orders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsea
Technologies
|
$
|
1,049.0
|
$
|
1,072.4
|
$
|
2,612.7
|
$
|
3,841.3
|
Surface
Technologies
|
|
398.1
|
|
543.5
|
|
1,030.6
|
|
1,572.4
|
Energy
Infrastructure
|
|
81.8
|
|
134.2
|
|
290.3
|
|
383.5
|
Intercompany
eliminations and other
|
|
(2.9)
|
|
(2.7)
|
|
(13.0)
|
|
(9.7)
|
Total inbound
orders
|
$
|
1,526.0
|
$
|
1,747.4
|
$
|
3,920.6
|
$
|
5,787.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
30
|
|
|
|
|
|
|
2015
|
|
2014
|
|
|
|
|
Order
Backlog
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsea
Technologies
|
$
|
4,287.6
|
$
|
5,855.2
|
|
|
|
|
Surface
Technologies
|
|
495.0
|
|
750.6
|
|
|
|
|
Energy
Infrastructure
|
|
172.8
|
|
241.5
|
|
|
|
|
Intercompany
eliminations
|
|
(2.8)
|
|
(20.0)
|
|
|
|
|
Total order
backlog
|
$
|
4,952.6
|
$
|
6,827.3
|
|
|
|
|
FMC TECHNOLOGIES,
INC. AND CONSOLIDATED SUBSIDIARIES
|
RECONCILIATION OF
NON-GAAP TO GAAP FINANCIAL MEASURES
|
(In millions
except per share amounts, unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Month
Ended
|
|
|
September
30
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(after-tax)
|
|
|
|
|
Net Income
attributable to FMC Technologies, Inc., excluding
charges
|
|
$ 140
|
|
$ 187
|
|
|
|
|
|
Impairment
charges
|
|
(45)
|
|
-
|
|
|
|
|
|
Restructuring
charges
|
|
(13)
|
|
-
|
|
|
|
|
|
Intercompany foreign
currency charge
|
|
-
|
|
(17)
|
|
|
|
|
|
Net Income
attributable to FMC Technologies, Inc., as
reported
|
|
$ 82
|
|
$ 170
|
|
|
|
|
|
Diluted EPS,
excluding charges
|
|
$ 0.61
|
|
$ 0.79
|
|
|
|
|
|
Diluted EPS, as
reported
|
|
$ 0.35
|
|
$ 0.72
|
FMC TECHNOLOGIES,
INC. AND CONSOLIDATED SUBSIDIARIES
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
September
30,
|
|
December
31,
|
|
|
2015
|
|
2014
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
711.5
|
$
|
638.8
|
Trade receivables,
net
|
|
1,738.6
|
|
2,127.0
|
Inventories,
net
|
|
874.5
|
|
1,021.2
|
Other current
assets
|
|
871.0
|
|
649.4
|
Total current
assets
|
|
4,195.6
|
|
4,436.4
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
1,396.3
|
|
1,458.4
|
Goodwill
|
|
519.4
|
|
552.1
|
Intangible assets,
net
|
|
253.8
|
|
314.5
|
Other
assets
|
|
346.1
|
|
410.7
|
Total
assets
|
$
|
6,711.2
|
$
|
7,172.1
|
|
|
|
|
|
Short-term debt and
current portion of long-term debt
|
$
|
33.5
|
$
|
11.7
|
Accounts payable,
trade
|
|
537.4
|
|
723.5
|
Advance payments and
progress billings
|
|
656.3
|
|
965.2
|
Other current
liabilities
|
|
1,144.2
|
|
1,083.2
|
Total current
liabilities
|
|
2,371.4
|
|
2,783.6
|
|
|
|
|
|
Long-term debt, less
current portion
|
|
1,261.2
|
|
1,293.7
|
Other
liabilities
|
|
554.6
|
|
617.1
|
FMC Technologies,
Inc. stockholders' equity
|
|
2,505.5
|
|
2,456.3
|
Noncontrolling
interest
|
|
18.5
|
|
21.4
|
Total liabilities and
equity
|
$
|
6,711.2
|
$
|
7,172.1
|
FMC TECHNOLOGIES,
INC. AND CONSOLIDATED SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(Unaudited and in
millions)
|
|
|
|
|
|
|
|
Nine Months
Ended
|
|
|
September
30
|
|
|
2015
|
|
2014
|
Cash provided
(required) by operating activities:
|
|
|
|
|
Net income
|
$
|
338.6
|
$
|
534.7
|
Depreciation and
amortization
|
|
182.5
|
|
173.4
|
Gain on sale of Material
Handling Products
|
|
-
|
|
(84.3)
|
Trade accounts receivable,
net
|
|
181.3
|
|
(276.2)
|
Inventories, net
|
|
105.2
|
|
(105.4)
|
Accounts payable,
trade
|
|
(140.6)
|
|
(13.4)
|
Advance payments and
progress billings
|
|
(241.3)
|
|
253.1
|
Asset impairment
charges
|
|
64.4
|
|
-
|
Other
|
|
12.0
|
|
1.4
|
Net cash provided by
operating activities
|
|
502.1
|
|
483.3
|
|
|
|
|
|
Cash provided
(required) by investing activities:
|
|
|
|
|
Capital
expenditures
|
|
(211.0)
|
|
(283.7)
|
Proceeds from sale of
Material Handling Products, net of cash divested
|
|
-
|
|
105.6
|
Other investing
|
|
(0.7)
|
|
8.9
|
Net cash required by
investing activities
|
|
(211.7)
|
|
(169.2)
|
|
|
|
|
|
Cash provided
(required) by financing activities:
|
|
|
|
|
Net decrease in
debt
|
|
(7.7)
|
|
(20.6)
|
Purchase of stock held in
treasury
|
|
(148.0)
|
|
(129.8)
|
Other financing
|
|
(26.9)
|
|
(45.5)
|
Net cash required by
financing activities
|
|
(182.6)
|
|
(195.9)
|
|
|
|
|
|
Effect of changes in
foreign exchange rates on cash and cash equivalents
|
|
(35.1)
|
|
(5.8)
|
|
|
|
|
|
Increase in cash and
cash equivalents
|
|
72.7
|
|
112.4
|
|
|
|
|
|
Cash and cash
equivalents, beginning of period
|
|
638.8
|
|
399.1
|
|
|
|
|
|
Cash and cash
equivalents, end of period
|
$
|
711.5
|
$
|
511.5
|
Logo -
http://photos.prnewswire.com/prnh/20081222/LAM028LOGO
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/fmc-technologies-reports-third-quarter-2015-diluted-earnings-per-share-of-061-excluding-impairment-and-restructuring-charges-300163373.html
SOURCE FMC Technologies, Inc.