HOUSTON, April 26, 2016 /PRNewswire/ -- FMC Technologies,
Inc. (NYSE:FTI) today reported first quarter 2016 revenue of
$1.2 billion, down 29 percent from
the prior-year quarter. The decline was driven by lower activity
and the negative impact of the strengthening U.S. dollar. Diluted
earnings per share were $0.09, which
includes total Company pre-tax impairment and other charges,
restructuring and other severance charges, and inventory
write-downs of $47.6 million, or
$0.13 per diluted share.
"Subsea Technologies delivered operating margins of 13.1
percent, excluding charges, as we benefited from solid execution
and restructuring savings," said John
Gremp, Chairman and CEO of FMC Technologies.
Total inbound orders were $671.6
million, including $345.9
million in Subsea Technologies orders. Backlog for the
Company was $4 billion, including
Subsea Technologies backlog of $3.4
billion.
"While operators' reduced capital spending continues to delay
large deepwater projects, we believe that our subsea service orders
will remain fairly resilient in 2016," added Gremp.
Review of Operations – First Quarter 2016
Subsea Technologies
Subsea Technologies first quarter
revenue was $864 million, down 25
percent from the prior-year quarter. After excluding the
$57 million of negative impact due to
the strong U.S. dollar, total revenue was down 20 percent
year-over-year.
Subsea Technologies operating profit decreased 35 percent from
the prior-year quarter to $109.5
million. Operating results include an $8 million negative impact related to the strong
U.S. dollar. The segment results also include $3.7 million of charges. Total operating profit,
excluding foreign currency impact and charges in both periods, was
down approximately 28 percent year-over-year, primarily due to the
decline in subsea revenues.
Subsea Technologies operating margins were 13.1 percent,
excluding charges.
Subsea Technologies inbound orders for the first quarter were
$345.9 million. Backlog was
$3.4 billion.
Surface Technologies
Surface Technologies first
quarter revenue was $265.5 million,
down 41 percent from the prior-year quarter, primarily due to the
significant decline in North American land activity.
Surface Technologies reported an operating loss of $28.6 million, which includes charges of
$41.8 million. Adjusted operating
results were down 81 percent from the prior-year quarter, when
excluding charges in both periods, primarily driven by the severe
North American activity decline and less favorable
pricing.
Surface Technologies operating margins were 5 percent, excluding
charges.
Surface Technologies inbound orders for the first quarter were
$258.5 million. Backlog was
$429.4 million.
Energy Infrastructure
Energy Infrastructure first
quarter revenue was $84.1 million,
down 17 percent from the prior-year quarter. The revenue decline
was primarily due to lower market activity in our measurement
solutions business.
Energy Infrastructure reported an operating loss of $3.3 million, which includes charges of
$2.1 million.
Energy Infrastructure inbound orders for the first quarter were
$73.8 million and backlog was
$157.7 million.
Corporate Items
Corporate expense in the first quarter
was $14.3 million, a decrease of
$2 million from the prior-year
quarter. Other revenue and other expense, net, increased
$3.6 million from the prior-year
quarter to $30 million of expense,
due largely to the strength of the U.S. dollar.
The Company ended the quarter with net debt of $209.6 million, down $30.2
million sequentially, due to strong operating cash flow. Net
interest expense was $7.5 million in
the quarter.
The Company repurchased approximately 1.1 million shares of
common stock at an average cost of $25.58 per share in the quarter.
Depreciation and amortization for the first quarter was
$63.3 million and capital
expenditures were $35.3 million.
The Company recorded an effective tax rate of 23.4 percent for
the first quarter.
Summary
FMC Technologies reported first quarter
diluted earnings per share of $0.22,
excluding total Company pre-tax impairment and other charges,
restructuring and other severance charges, and inventory
write-downs of $47.6 million, or
$0.13 per diluted share.
The Company recorded Subsea Technologies revenue of $864 million with margins of 13.1 percent in the
quarter, excluding charges.
Total inbound orders of $671.6
million in the first quarter included $345.9 million in Subsea Technologies orders.
The Company's backlog stands at $4
billion, including Subsea Technologies backlog of
$3.4 billion.
About FMC Technologies
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. The company has
approximately 16,500 employees and operates 29 major production
facilities and services bases in 18 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 products 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 products; 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; a
downgrade in the ratings of our debt could restrict our ability to
access the debt capital markets; continuing consolidation within
our industry; and our dependence on the continuing services of
certain of our key managers and employees. 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 second quarter 2016
conference call at 9 a.m. ET on
Thursday, July 21, 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
|
|
|
March
31
|
|
|
2016
|
|
2015
|
|
|
|
|
|
|
Revenue
|
$
|
1,208.7
|
$
|
1,695.2
|
|
Costs and
expenses
|
|
1,164.1
|
|
1,496.6
|
|
|
44.6
|
|
198.6
|
|
|
|
|
|
|
Other expense,
net
|
|
(11.3)
|
|
(6.3)
|
|
|
|
|
|
|
Income before net
interest expense and income taxes
|
|
33.3
|
|
192.3
|
|
Net interest
expense
|
|
(7.5)
|
|
(7.3)
|
|
|
|
|
|
|
Income before income
taxes
|
|
25.8
|
|
185.0
|
|
Provision for income
taxes
|
|
6.0
|
|
36.9
|
|
|
|
|
|
|
Net income
|
|
19.8
|
|
148.1
|
|
Net income
attributable to noncontrolling interests
|
|
-
|
|
(0.5)
|
|
|
|
|
|
|
Net income
attributable to FMC Technologies, Inc.
|
$
|
19.8
|
$
|
147.6
|
|
|
|
|
|
|
Earnings per share
attributable to FMC Technologies, Inc.:
|
|
|
|
|
|
Basic
|
$
|
0.09
|
$
|
0.63
|
|
Diluted
|
$
|
0.09
|
$
|
0.63
|
|
|
|
|
|
|
Weighted average
shares outstanding:
|
|
|
|
|
|
Basic
|
|
228.0
|
|
233.0
|
|
Diluted
|
|
228.6
|
|
233.9
|
|
FMC TECHNOLOGIES,
INC. AND CONSOLIDATED SUBSIDIARIES
|
|
|
BUSINESS SEGMENT
DATA
|
|
|
(Unaudited and in
millions)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
March
31
|
|
|
|
2016
|
|
2015
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsea
Technologies
|
$
|
864.0
|
$
|
1,157.2
|
|
|
Surface
Technologies
|
|
265.5
|
|
446.3
|
|
|
Energy
Infrastructure
|
|
84.1
|
|
100.9
|
|
|
Other revenue (1) and
intercompany eliminations
|
|
(4.9)
|
|
(9.2)
|
|
|
$
|
1,208.7
|
$
|
1,695.2
|
|
|
|
|
|
|
|
|
Income before
income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment operating
profit (loss)
|
|
|
|
|
|
|
Subsea
Technologies
|
$
|
109.5
|
$
|
168.7
|
|
|
Surface
Technologies
|
|
(28.6)
|
|
62.9
|
|
|
Energy
Infrastructure
|
|
(3.3)
|
|
2.9
|
|
|
Total segment
operating profit
|
|
77.6
|
|
234.5
|
|
|
|
|
|
|
|
|
Corporate
items
|
|
|
|
|
|
|
Corporate expense
(2)
|
|
(14.3)
|
|
(16.3)
|
|
|
Other revenue (1) and
other expense, net (3)
|
|
(30.0)
|
|
(26.4)
|
|
|
Net interest
expense
|
|
(7.5)
|
|
(7.3)
|
|
|
Total corporate
items
|
|
(51.8)
|
|
(50.0)
|
|
|
|
|
|
|
|
|
Income before income
taxes attributable
|
|
|
|
|
|
|
to
FMC Technologies, Inc. (4)
|
$
|
25.8
|
$
|
184.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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
|
|
|
|
|
March
31
|
|
|
|
|
2016
|
|
2015
|
|
|
|
Inbound
Orders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsea
Technologies
|
$
|
345.9
|
$
|
552.0
|
|
|
|
Surface
Technologies
|
|
258.5
|
|
326.3
|
|
|
|
Energy
Infrastructure
|
|
73.8
|
|
95.8
|
|
|
|
Intercompany
eliminations and other
|
|
(6.6)
|
|
(5.1)
|
|
|
|
Total inbound
orders
|
$
|
671.6
|
$
|
969.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March
31
|
|
|
|
|
2016
|
|
2015
|
|
|
|
Order
Backlog
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsea
Technologies
|
$
|
3,372.5
|
$
|
4,825.0
|
|
|
|
Surface
Technologies
|
|
429.4
|
|
519.5
|
|
|
|
Energy
Infrastructure
|
|
157.7
|
|
173.1
|
|
|
|
Intercompany
eliminations
|
|
(4.5)
|
|
(10.6)
|
|
|
|
Total order
backlog
|
$
|
3,955.1
|
$
|
5,507.0
|
|
|
|
FMC TECHNOLOGIES,
INC. AND CONSOLIDATED SUBSIDIARIES
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
2016
|
|
2015
|
|
|
(Unaudited)
|
|
As
Adjusted
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
1,032.3
|
$
|
916.2
|
|
Receivables,
net
|
|
1,413.3
|
|
1,522.4
|
|
Inventories,
net
|
|
719.7
|
|
764.1
|
|
Other current
assets
|
|
672.6
|
|
727.5
|
|
Total current
assets
|
|
3,837.9
|
|
3,930.2
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
1,340.9
|
|
1,371.5
|
|
Goodwill
|
|
520.1
|
|
514.7
|
|
Intangible assets,
net
|
|
237.2
|
|
246.3
|
|
Other
assets
|
|
377.1
|
|
356.7
|
|
Total
assets
|
$
|
6,313.2
|
$
|
6,419.4
|
|
|
|
|
|
|
Short-term debt and
current portion of long-term debt
|
$
|
23.5
|
$
|
21.9
|
|
Accounts payable,
trade
|
|
418.0
|
|
519.3
|
|
Advance payments and
progress billings
|
|
630.0
|
|
664.6
|
|
Other current
liabilities
|
|
975.4
|
|
1,099.5
|
|
Total current
liabilities
|
|
2,046.9
|
|
2,305.3
|
|
|
|
|
|
|
Long-term debt, less
current portion
|
|
1,218.4
|
|
1,134.1
|
|
Other
liabilities
|
|
427.7
|
|
436.8
|
|
FMC Technologies,
Inc. stockholders' equity
|
|
2,604.1
|
|
2,524.1
|
|
Noncontrolling
interest
|
|
16.1
|
|
19.1
|
|
Total liabilities and
equity
|
$
|
6,313.2
|
$
|
6,419.4
|
|
FMC TECHNOLOGIES,
INC. AND CONSOLIDATED SUBSIDIARIES
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(Unaudited and in
millions)
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
March
31
|
|
|
2016
|
|
2015
|
|
Cash provided
(required) by operating activities:
|
|
|
|
|
|
Net income
|
$
|
19.8
|
$
|
148.1
|
|
Depreciation and
amortization
|
|
63.3
|
|
57.8
|
|
Receivables, net
|
|
146.9
|
|
254.8
|
|
Inventories, net
|
|
51.5
|
|
(23.3)
|
|
Accounts payable,
trade
|
|
(110.9)
|
|
(78.5)
|
|
Advance payments and
progress billings
|
|
(53.3)
|
|
(138.9)
|
|
Asset impairment
charges
|
|
34.4
|
|
3.9
|
|
Other
|
|
(42.7)
|
|
(48.3)
|
|
Net cash provided by
operating activities
|
|
109.0
|
|
175.6
|
|
|
|
|
|
|
Cash provided
(required) by investing activities:
|
|
|
|
|
|
Capital
expenditures
|
|
(35.3)
|
|
(86.7)
|
|
Other investing
|
|
(7.4)
|
|
5.3
|
|
Net cash required by
investing activities
|
|
(42.7)
|
|
(81.4)
|
|
|
|
|
|
|
Cash provided
(required) by financing activities:
|
|
|
|
|
|
Net increase in
debt
|
|
84.2
|
|
8.4
|
|
Purchase of stock held in
treasury
|
|
(30.5)
|
|
(30.8)
|
|
Other financing
|
|
(16.4)
|
|
(8.5)
|
|
Net cash provided
(required) by financing activities
|
|
37.3
|
|
(30.9)
|
|
|
|
|
|
|
Effect of changes in
foreign exchange rates on cash and cash equivalents
|
|
12.5
|
|
(7.0)
|
|
|
|
|
|
|
Increase in cash and
cash equivalents
|
|
116.1
|
|
56.3
|
|
|
|
|
|
|
Cash and cash
equivalents, beginning of period
|
|
916.2
|
|
638.8
|
|
|
|
|
|
|
Cash and cash
equivalents, end of period
|
$
|
1,032.3
|
$
|
695.1
|
|
FMC TECHNOLOGIES,
INC. AND CONSOLIDATED SUBSIDIARIES
|
|
RECONCILIATION OF
NON-GAAP TO GAAP FINANCIAL MEASURES
|
|
(In millions
except per share amounts, unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
March
31
|
|
|
2016
|
|
2015
|
|
|
|
|
|
|
(after-tax)
|
|
|
|
|
|
Net Income
attributable to FMC Technologies, Inc., excluding
charges
|
$
|
51
|
$
|
156
|
|
|
|
|
|
|
Impairment and other
charges (1)
|
|
(24)
|
|
(3)
|
|
Restructuring and
other severance charges (2)
|
|
(6)
|
|
(5)
|
|
Inventory write-downs
(3)
|
|
(1)
|
|
-
|
|
|
|
|
|
|
Net Income
attributable to FMC Technologies, Inc., as
reported
|
$
|
20
|
$
|
148
|
|
|
|
|
|
|
Diluted EPS,
excluding charges
|
$
|
0.22
|
$
|
0.67
|
|
|
|
|
|
|
Diluted EPS, as
reported
|
$
|
0.09
|
$
|
0.63
|
|
|
(1) Tax benefit of
$12 million and $1 million during the three months ended March 31,
2016 and 2015, respectively.
|
|
(2) Tax benefit of $3
million and $2 million during the three months ended March 31, 2016
and 2015, respectively.
|
|
(3) Tax benefit of $1
million during the three months ended March 31, 2016.
|
|
FMC TECHNOLOGIES,
INC. AND CONSOLIDATED SUBSIDIARIES
|
|
RECONCILIATION OF
NON-GAAP TO GAAP FINANCIAL MEASURES
|
|
(In millions,
unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
March 31,
2016
|
|
|
SubseaTechnologies
|
|
SurfaceTechnologies
|
|
EnergyInfrastructure
|
|
|
|
|
|
|
|
|
(pre-tax)
|
|
|
|
|
|
|
|
Segment operating
profit (loss), excluding charges
|
$
|
113.2
|
$
|
13.2
|
$
|
(1.2)
|
|
|
|
|
|
|
|
|
Impairment and other
charges
|
|
(0.1)
|
|
(35.6)
|
|
-
|
|
Restructuring and
other severance charges
|
|
(3.6)
|
|
(4.0)
|
|
(2.1)
|
|
Inventory
write-downs
|
|
-
|
|
(2.2)
|
|
-
|
|
|
|
|
|
|
|
|
Segment operating
profit (loss), as reported
|
$
|
109.5
|
$
|
(28.6)
|
$
|
(3.3)
|
|
|
|
|
|
|
|
|
Segment operating
profit (loss) as a percent of revenue, excluding charges
|
13.1%
|
|
5.0%
|
|
(1.5)%
|
|
|
|
|
|
|
|
|
Segment operating
profit (loss) as a percent of revenue, as reported
|
|
12.7%
|
|
(10.8)%
|
|
(4.0)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
March 31,
2015
|
|
|
SubseaTechnologies
|
|
SurfaceTechnologies
|
|
EnergyInfrastructure
|
|
|
|
|
|
|
|
|
(pre-tax)
|
|
|
|
|
|
|
|
Segment operating
profit, excluding charges
|
$
|
169.7
|
$
|
71.0
|
$
|
4.3
|
|
|
|
|
|
|
|
|
Impairment
charges
|
|
(0.3)
|
|
(3.6)
|
|
-
|
|
Restructuring and
other severance charges
|
|
(0.7)
|
|
(4.5)
|
|
(1.4)
|
|
|
|
|
|
|
|
|
Segment operating
profit, as reported
|
$
|
168.7
|
$
|
62.9
|
$
|
2.9
|
|
|
|
|
|
|
|
|
Segment operating
profit as a percent of revenue, excluding charges
|
|
14.7%
|
|
15.9%
|
|
4.2%
|
|
|
|
|
|
|
|
|
Segment operating
profit as a percent of revenue, as reported
|
|
14.6%
|
|
14.1%
|
|
2.9%
|
|
FMC TECHNOLOGIES,
INC. AND CONSOLIDATED SUBSIDIARIES
|
|
RECONCILIATION OF
NON-GAAP TO GAAP FINANCIAL MEASURES
|
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
2016
|
|
2015
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
1,032.3
|
$
|
916.2
|
|
Short-term debt and
current portion of long-term debt
|
|
(23.5)
|
|
(21.9)
|
|
Long-term debt, less
current portion
|
|
(1,218.4)
|
|
(1,134.1)
|
|
Net debt
|
$
|
(209.6)
|
$
|
(239.8)
|
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visit:http://www.prnewswire.com/news-releases/fmc-technologies-reports-first-quarter-2016-diluted-earnings-per-share-of-022-excluding-013-of-charges-300257944.html
SOURCE FMC Technologies, Inc.