Regulatory News:
Technip (Paris:TEC) (ISIN:FR0000131708) (ADR:TKPPY):
THIRD QUARTER 2016: STRONG FINANCIALS
- Net Income up 12.4% versus 3Q 15
to €184 million
- Adjusted Operating
Margin1 at c.10%, up 0.4% versus 3Q 15
- Adjusted net cash resilient at
€1.8 billion
- Order intake at €1.5 billion in
line with recent quarters
- Adjusted revenue at €2.9
billion, stable at constant currency versus 3Q 15
EFFECTIVE EXECUTION AND COST REDUCTION
- Successful offshore campaigns, strong
vessel utilization in Subsea, and successful sail away of all 78
modules for phase 1 of Yamal LNG project
- Cost reduction plan on track: €900
million savings by year-end 2016 out of a total of over €1
billion
FULL YEAR 2016 OBJECTIVES UPGRADED
- Subsea upgraded: adjusted revenue above
€5.0 billion (previously between €4.7 and €5.0 billion), adjusted
Operating Income From Recurring Activities2 around €700 million
(previously around €680 million)
- Onshore/Offshore unchanged: adjusted
revenue between €5.7 and €6.0 billion, adjusted Operating Income
From Recurring Activities2 around €280 million
MERGER UPDATE
- Major regulatory milestones
achieved
- Shareholder meetings called for
December 5, 2016
1 Adjusted operating income from recurring activities after
income/(loss) of equity affiliates, divided by adjusted revenue.2
Adjusted operating income from recurring activities after
income/(loss) of equity affiliates.
Note: The third quarter 2016 results presented in this
press release were prepared on the adjusted basis as described in
Technip’s fourth quarter 2015 press release. These results reflect
the financial reporting framework used for management purposes.
- 3Q 16 revenue at €2,126 million within
IFRS framework and €2,919 million within adjusted framework
- 3Q 16 net income at €184 million within
both IFRS and adjusted frameworks
On October 25, 2016, Technip’s Board of Directors approved the
condensed interim consolidated financial statements for the first
nine-month period ended September 30, 2016.
€ million
(except Diluted Earnings per Share)
3Q 15
3Q 16
Change 9M 15
9M 16 Change Adjusted
Revenue 3,108.9
2,919.4 (6.1)%
9,090.6 8,494.4
(6.6)% Subsea 1,547.0 1,397.2 (9.7)% 4,388.4
4,148.8 (5.5)% Onshore/Offshore 1,561.9
1,522.2 (2.5)%
4,702.2 4,345.6 (7.6)%
Adjusted Underlying EBITDA1 371.8 352.7
(5.1)% 968.5 981.8 1.4% Adjusted
Underlying EBITDA Margin 12.0%
12.1% 12bp 10.7%
11.6% 90bp
Adjusted
Underlying OIFRA2 292.0 284.6
(2.5)% 745.2 780.9 4.8% Subsea 232.0
229.1 (1.3)% 647.5 610.6 (5.7)% Onshore/Offshore 75.5 70.3 (6.9)%
152.2 213.5 40.3% Adjusted Underlying Operating Margin3
9.4% 9.7% 36bp
8.2% 9.2%
100bp One-off Charge (14.4) (9.0) nm (584.8) (98.5) nm
Underlying Net Income4 184.3
203.2 10.3%
475.3 523.9
10.2% Net Income of the Parent
Company 163.9
184.3 12.4%
(56.9) 422.0
nm Diluted Earnings per Share5 (€) 1.35
1.46 8.0%
(0.50) 3.44 nm
Order Intake
1,746 1,514
4,757 3,927
Backlog 17,459
12,285 17,459
12,285
1 Adjusted operating income from recurring activities after
income/(loss) of equity affiliates excluding exceptional items,
depreciation and amortization. No exceptional items in 9M16.2
Adjusted operating income from recurring activities after
income/(loss) of equity affiliates excluding exceptional items. No
exceptional items in 9M16.3 Adjusted operating income from
recurring activities after income/(loss) of equity affiliates
excluding exceptional items, divided by adjusted revenue. No
exceptional items in 9M16.4 Net income of the parent company
excluding exceptional items. See annex V.5 As per IFRS, diluted
earnings per share are calculated by dividing income/(loss)
attributable to the parent company’s shareholders, restated for
financial interest related to dilutive potential ordinary shares,
by the weighted average number of outstanding shares during the
period, plus the effect of dilutive potential ordinary shares
related to the convertible bonds, dilutive stock options and
performance shares calculated according to the “Share Purchase
Method” (IFRS 2), less treasury shares. In conformity with this
method, anti-dilutive stock options are ignored in calculating EPS.
Dilutive options are taken into account if the subscription price
of the stock options plus the future and still outstanding IFRS 2
charge is lower than the average market share price during the EPS
reference period.
Thierry Pilenko, Chairman and CEO, commented: “A robust
operational performance associated with strong cost reduction
measures enabled Technip to record a solid third quarter including
an adjusted margin on recurring operations nearing 10%. In
addition, we have made considerable progress towards our merger
with FMC Technologies passing major regulatory milestones. Last, we
recorded a first project win for our alliance.
Third Quarter Performance
In Subsea, we started handover to clients on a range of
projects, including T.E.N. in Ghana ahead of schedule. Vessel
utilization remained strong at 86% reflecting efficient management
of our high-end fleet, including in Brazil where we have 5 vessels
on charter. We continued to be busy also across our flexible
manufacturing plants. In Onshore/Offshore, on the Yamal project, we
completed the sail away of all 78 modules planned for the first
phase of the project, and their delivery on the Sabetta site in
Siberia is ahead of schedule. Mobilisation on site has also been
impressive this year, with over 10,000 people now active on the
site construction and hook-up.
Our cost reduction efforts continued as planned and enabled us
to sustain our adjusted group margins at 9.7% (compared to 9.4%
last year) despite revenues being down 6.1% year-on-year.
Technip's adjusted OIFRA was therefore €285 million compared to
€260 million in the second quarter and €292 million a year ago. Net
income rose 12.4% to €184 million.
Our cash-flow showed the expected outflow of working capital as
we applied contract advances to project progress but net cash was
resilient at €1.8 billion.
Order intake was in line with last quarters, with nearly €0.5
billion in Subsea and €1 billion in Onshore/Offshore, with the
Greater Enfield and Jebel Ali projects being the most important
awards.
Market Outlook
Our teams are busy tendering on new projects, even if the
picture is varied across geographic regions.
Onshore/Offshore remains quite robust and we continue to see
opportunities to get involved early with customers, positioning
ourselves for future projects. The resilience of this segment is
underpinned by our long-lasting client relationships, our front-end
presence and our proprietary technology. We continue to be well
positioned on a number of promising early stage Onshore/Offshore
projects.
In Subsea, we are seeing pockets of growing demand, for example
greenfield in the North Sea, and sustained interest for long
tiebacks and field extensions. Also, our clients continue to work
with us on securing structural cost reduction in offshore
developments. This interest has accelerated over last six months
through our Technip / FMC Technologies Alliance, with 17 integrated
early stage studies at the Forsys Subsea joint venture and our
first follow-on business - a fast track development of the
Lancaster field in the North Sea.
Overall, we remain confident in our ability to drive change in
our industry and therefore to enable our clients to make new
offshore investments on a profitable basis, even in a low oil price
environment.
Turning to our full year 2016 objectives, our Subsea guidance is
upgraded with adjusted revenues expected above €5 billion and
adjusted OIFRA around €700 million, while our Onshore/Offshore
guidance remains unchanged in every respect.
We expect to enter 2017 with a good backlog and promising
prospects, and intend to continue to drive out costs down and focus
on solid project execution. Based on these elements, we would
expect for 2017: Subsea to deliver roughly stable adjusted margins
on lower adjusted revenues; Onshore/Offshore to deliver rising
adjusted profit and adjusted margins on slightly lower
revenues.
Merger with FMC Technologies
A number of important milestones have been reached over the last
three months. Along with obtaining anti-trust in most countries, we
have foreign investment approval both in the US and France. The
necessary regulatory fillings have also been validated.
As a result, we confirm that both companies will hold their
shareholders' meetings on December 5, 2016. This would enable our
merger to close in January, earlier than originally planned.
Conclusion
To conclude, Technip’s teams have shown their ability in the
third quarter to capitalize on the backlog to deliver solid revenue
and profit, even in the current downturn of our industry. We have
retained a robust, liquid balance sheet. Based on our proven model,
we are proving capable of winning diversified and integrated new
projects. Last, we are taking further our strategy to create a
broad based oilfield services company through the merger with FMC
Technologies, which will create the third largest company in our
sector, well placed to create substantial value for all our
stakeholders.”
I. ORDER INTAKE AND BACKLOG
1. Third Quarter 2016 Order Intake
During third quarter 2016, Technip’s order intake was
€1.5 billion. The breakdown by business segment was as follows:
Order Intake1 (€ million)
3Q
2015 3Q 2016 Subsea
530 486 Onshore/Offshore 1,216 1,028
Total 1,746
1,514
Subsea order intake included a large contract for the
development of the Greater Enfield Project in the North West Shelf,
Australia. This project covers project management, design,
engineering, procurement, installation and pre-commissioning (EPIC)
of flowlines, flexible risers, umbilicals and other subsea
structures. The flexible pipes will be manufactured in Asiaflex in
Malaysia, while the umbilicals will be supplied by Technip
Umbilicals’ facility in Newcastle, UK. A range of vessels from the
Group’s fleet will be involved in the project.
Onshore/Offshore order intake included a large
engineering, procurement and construction (EPC) contract covering
the design and construction of new processing and ancillary units
for the expansion of the Jebel Ali refinery in United Arab
Emirates, on which Technip worked when it was first built. The main
package of the project consists of adding a new Condensate
processing train to the existing facility, expanding its daily
capacity to 210,000 barrels, up from 140,000 barrels per day.
In Russia, Technip was awarded a contract to provide engineering
and procurement of three proprietary SMK™ grassroots furnaces at
Kazan, Republic of Tatarstan. The furnaces will be part of an
ethylene plant at the site. The project represents another step in
the ongoing cracking furnaces replacement program of the
client.
Listed in annex IV are the main contracts announced since July
2016 and their approximate value if publicly disclosed.
2. Backlog
At the end of third quarter 2016, Technip’s backlog was
€12.3 billion, compared with €13.5 billion at the end of second
quarter 2016 and €17.5 billion at the end of third quarter
2015.
Estimated Backlog2
Schedulingas of September 30, 2016 (€ million)
Subsea
Onshore/Offshore Group 2016 (3
months) 1,006 1,337
2,343 2017 2,566 3,639 6,205 2018 and beyond
1,506 2,231 3,737
Total 5,078
7,207
12,285
1 Order intake includes all projects for which revenues are
consolidated in our adjusted financial statements.2 Backlog
includes all projects for which revenues are consolidated in our
adjusted financial statements.
II. THIRD QUARTER 2016 OPERATIONAL & FINANCIAL HIGHLIGHTS
– ADJUSTED BASIS
1. Subsea
Subsea main operations for the quarter were as
follows:
- In the Americas:
- In the US Gulf of Mexico, the
Deep Blue successfully completed its offshore operations on the
Thunder Horse South Expansion and Odd Job projects, and also
completed the first trip of a combined installation campaign on the
Blind Faith and the South Santa Cruz and Barataria developments.
Meanwhile, the final completion certificate for Stones DC1 was
received.
- In Brazil, at our manufacturing
plants in Vitória and Açu, flexible pipe production progressed for
the pre-salt fields of Lula Alto, Iracema Norte and Libra Extended
Well Test, and was completed for the Iracema Sul field. Meanwhile,
the pipe-lay support vessel (PLSV) Skandi Açu was delivered and
started working under its 8-year long term charter contract.
- In Central America, the first
diving trip on the Juniper project was completed by the
Wellservicer which was subsequently mobilized on Mariscal Sucre
Dragon development in Venezuela.
- In the North Sea, offshore
operations continued on Quad 204 where the North Sea Atlantic
completed all riser connections to the Glen Lyon FPSO and started
infield works. On Edradour, the Deep Energy and the Skandi Africa
successfully completed the 2016 offshore campaign, the former
installing rigid pipelines and the latter manifolds and umbilicals.
On Greater Stella, the Apache completed the oil export pipeline
installation campaign, while the Orelia was mobilized in the end of
the quarter to perform the tie-ins and commissioning.
- In Asia Pacific, the Deep Orient
vessel completed the offshore operations related to the jumper
metrology on Prelude in Australia and was mobilized once again on
the project in the end of the quarter to perform the jumper
installation campaign. Meanwhile, in Indonesia, the G1201 completed
the S-lay campaign on Jangkrik at the end of the quarter, and
started transit to Trinidad and Tobago to work on the Juniper
project.
- In West Africa, the Deep Pioneer
successfully completed its offshore operations on T.E.N. in Ghana
and on the Mpungi North, part of the Block 15/06 development in
Angola, while the G1200 vessel continued working on Moho Nord in
Congo. On Kaombo, engineering and procurement progressed and
umbilicals fabrication continued in our manufacturing plants, while
the welding of the rigid pipes started in the Dande spoolbase, in
Angola.
Overall, the Group vessel utilization rate for the third
quarter of 2016 was 86%, below the 89% in the third quarter of 2015
and above the 77% in the second quarter of 2016. The Olympic
Challenger lease charter expired, returned to its owner and left
the Technip fleet.
Subsea financial performance is set out in the following
table:
€ million
3Q
2015 3Q 2016
Change Subsea
Adjusted Revenue 1,547.0 1,397.2 (9.7)%
Adjusted EBITDA 302.4 289.5 (4.3)% Adjusted EBITDA Margin 19.5%
20.7% 117bp Adjusted OIFRA after Income/(Loss) of Equity
Affiliates* 232.0 229.1 (1.3)% Adjusted Operating Margin
15.0% 16.4% 140bp
* No one-off charge accounted in Subsea adjusted operating
income from recurring activities.
2. Onshore/Offshore
Onshore/Offshore main operations for the quarter were as
follows:
- In the Middle East, the
float-over of the topsides was accomplished for the FMB platforms,
offshore Qatar. Meanwhile, in United Arab Emirates, fabrication
continued for the Umm Lulu complex and mobilization started for the
design and construction of new processing and ancillary units for
the expansion of the Jebel Ali refinery.
- In Asia Pacific, installation
works were successfully completed for the Malikai tension leg
platform (TLP) offshore Malaysia, while the Petronas FLNG Satu
neared Ready For Start Up. In South Korea, integration and
commissioning activities continued on the Prelude FLNG. In Brunei,
construction was completed for the Maharaja Lela & Jamalulalam
South project.
- In Europe and Russia, all 78
modules of the phase 1 of the Yamal LNG project sailed away to
Sabetta. 75 modules have already been delivered to the site and 3
modules are currently passing through the Northern Sea Route. In
Slovakia, construction activities progressed well for the Duslo
ammonia plant with the erection of steel structures ongoing. In the
Czech Republic, procurement activities continued for the Litvinov
polyethylene plant.
- In Africa, early works
progressed well for the MIDOR refinery modernization and expansion
project in Egypt.
- In the Americas, construction
activities continued on the CPChem polyethylene plant in Texas and
on Sasol’s ethane cracker and derivative complex near Lake Charles,
Louisiana. The mechanical completion of the jacket was achieved for
the Juniper platform in Trinidad and Tobago.
Onshore/Offshore financial performance is set out in the
following table:
€ million
3Q
2015 3Q 2016
Change Onshore/Offshore
Adjusted Revenue 1,561.9 1,522.2 (2.5)%
Adjusted OIFRA after Income/(Loss) of Equity Affiliates* 75.5 70.3
(6.9)% Adjusted Underlying Operating Margin 4.8%
4.6% (22)bp
* No one-off charge accounted in Onshore/Offshore adjusted
operating income from recurring activities.
3. Group
The Group’s adjusted operating income from recurring
activities after income/(loss) of equity affiliates is set out
in the table below. Corporate charges fell to €15 million from €16
million in the third quarter 2015.
€ million
3Q
2015 3Q 2016
Change Group
Adjusted Revenue 3,108.9 2,919.4 (6.1)%
Adjusted OIFRA after Income/(Loss) of Equity Affiliates* 292.0
284.6 (2.5)% Adjusted Underlying Operating Margin
9.4% 9.7% 36bp
* No one-off charge accounted in adjusted operating income from
recurring activities.
In the third quarter of 2016, compared to a year ago, the
estimated translation impact from foreign exchange was
negative €94 million on adjusted revenue and negative €21 million
on adjusted operating income from recurring activities after
income/(loss) of equity affiliates.
4. Adjusted Non-Current Items and Group Net Income
Adjusted non-current operating items of €(9) million were booked
in the quarter mainly related to the restructuring plan. We
continue to expect to deliver €900 million of cost savings in 2016
out of a total of over €1 billion. In addition, we booked €12
million of transaction costs in the quarter related to the
combination with FMC Technologies.
Adjusted financial result in the third quarter of 2016
included net interest expenses of only €4 million and a €9 million
positive impact from changes in foreign exchange rates and the fair
market value of hedging instruments.
€ million (except
Diluted Earnings per Share and Diluted Number of Shares)
3Q 2015 3Q 2016 Change Adjusted
OIFRA after Income/(Loss) of Equity Affiliates* 292.0
284.6 (2.5)% Adjusted Non-Current Operating Result (14.0)
(21.6) 54.3% Adjusted Financial Result (39.2) 4.1 nm Adjusted
Income Tax Expense (70.3) (83.4) 18.6% Adjusted Effective Tax Rate
29.4% 31.2% 179bp Adjusted Non-Controlling Interests (4.6) 0.6 nm
Net Income of the Parent Company 163.9 184.3
12.4% Underlying Net Income 184.3
203.2 10.3% Diluted Number of Shares
125,439,384 126,896,391 1.2%
Diluted Earnings per Share (€)
1.35 1.46 8.0%
* No one-off charge accounted in adjusted operating income from
recurring activities.
5. Adjusted Cash Flow and Statement of Consolidated Financial
Position
As of September 30, 2016, the cash and cash equivalents
were as follows (€ million):
Adjusted Cash1 as of June 30,
2016 4,494.9 Adjusted Cash Generated from/(used
in) Operating Activities (198.9) Adjusted Cash Generated
from/(used in) Investing Activities (35.3) Adjusted Cash Generated
from/(used in) Financing Activities* (161.8) Adjusted FX Impacts
47.7
Adjusted Cash1 as of September 30,
2016 4,146.6
*out of which share buy-back for €135.7 million
As of September 30, 2016, the adjusted net cash position
was €1,824 million, down €368 million compared with €2,192 million
as of June 30, 2016, reflecting project progress and the share
buy-back during the quarter.
Adjusted capital expenditures for the third
quarter of 2016 were €35 million, compared with €74 million
one year ago.
The Group’s balance sheet remains robust and liquid.
Adjusted shareholders’ equity of the parent company
as of September 30, 2016 was €4,817 million, compared with
€4,536 million as of December 31, 2015.
1 Adjusted cash and cash equivalents, less bank overdraft.
6. Other
As previously disclosed, on March 31, 2016, Dong terminated, on
the grounds of an alleged material breach, a contract signed on
February 27, 2012 with a consortium of Technip France and DSME.
This contract covered engineering, procurement, fabrication,
hook-up, and commissioning assistance for a fixed wellhead and
process platform and associated facilities for the Hejre field
offshore Denmark. Dong announced that it will not complete the
platform and will seek to avoid taking delivery and ownership of
the platform. This dispute is currently progressing through a
series of arbitration proceedings managed by the competent arbitral
tribunal pursuant to which Dong and the consortium members will
present their respective claims and arguments. The consortium
members reiterate that they do not agree with Dong's actions or
grounds.
III. FULL YEAR 2016 OBJECTIVES UPGRADED
- Subsea upgraded: Adjusted revenue
above €5.0 billion (previously between €4.7 and €5.0 billion),
adjusted Operating Income From Recurring Activities1
around €700 million (previously around €680 million)
- Onshore/Offshore unchanged: adjusted
revenue between €5.7 and €6.0 billion, adjusted Operating Income
From Recurring Activities1 around €280
million
1 Adjusted operating income from recurring activities after
income/(loss) of equity affiliates.
°
° °
The information package on Third Quarter 2016
results includes this press release and the annexes which follow,
as well as the presentation published on Technip’s website:
www.technip.com
NOTICE
Today, Thursday, October 27, 2016, Chairman and CEO Thierry
Pilenko, along with Group CFO Julian Waldron, will comment on
Technip’s results and answer questions from the financial community
during a conference call in English starting at 9:30 a.m.
Paris time.
To participate in the conference call, you may call any of the
following telephone numbers approximately 5 - 10 minutes prior to
the scheduled start time:
France / Continental Europe:
+33 (0) 1 70 77 09 44
UK:
+44 (0) 203 367 9453
USA:
+1 855 402 7761
The conference call will also be available via a simultaneous,
listen-only audio-cast on Technip’s website.
A replay of this conference call will be available approximately
two hours following the conference call for three months on
Technip’s website and at the following telephone numbers:
Telephone Numbers
Confirmation Code
France / Continental Europe:
+33 (0) 1 72 00 15 00
303880#
UK:
+44 (0) 203 367 9460
303880#
USA:
+1 877 642 3018
303880#
Cautionary note regarding forward-looking
statements
This press release contains both historical and
forward-looking statements. These forward-looking statements are
not based on historical facts, but rather reflect our current
expectations concerning future results and events, and generally
may be identified by the use of forward-looking words such as
“believe”, “aim”, “expect”, “anticipate”, “intend”, “foresee”,
“likely”, “should”, “planned”, “may”, “estimates”, “potential” or
other similar words. Similarly, statements that describe our
objectives, plans or goals are or may be forward-looking
statements. These forward-looking statements involve known and
unknown risks, uncertainties and other factors that may cause our
actual results, performance or achievements to differ materially
from the anticipated results, performance or achievements expressed
or implied by these forward-looking statements. Risks that could
cause actual results to differ materially from the results
anticipated in the forward-looking statements include, among other
things: our ability to successfully continue to originate and
execute large services contracts, and construction and project
risks generally; the level of production-related capital
expenditure in the oil and gas industry as well as other
industries; currency fluctuations; interest rate fluctuations; raw
material (especially steel) as well as maritime freight price
fluctuations; the timing of development of energy resources; armed
conflict or political instability in the Arabian-Persian Gulf,
Africa or other regions; the strength of competition; control of
costs and expenses; the reduced availability of
government-sponsored export financing; losses in one or more of our
large contracts; U.S. legislation relating to investments in Iran
or elsewhere where we seek to do business; changes in tax
legislation, rules, regulation or enforcement; intensified price
pressure by our competitors; severe weather conditions; our ability
to successfully keep pace with technology changes; our ability to
attract and retain qualified personnel; the evolution,
interpretation and uniform application and enforcement of
International Financial Reporting Standards (IFRS), according to
which we prepare our financial statements as of January 1, 2005;
political and social stability in developing countries;
competition; supply chain bottlenecks; the ability of our
subcontractors to attract skilled labor; the fact that our
operations may cause the discharge of hazardous substances, leading
to significant environmental remediation costs; our ability to
manage and mitigate logistical challenges due to underdeveloped
infrastructure in some countries where we are performing
projects.
Some of these risk factors are set forth and discussed in
more detail in our Annual Report. Should one of these known or
unknown risks materialize, or should our underlying assumptions
prove incorrect, our future results could be adversely affected,
causing these results to differ materially from those expressed in
our forward-looking statements. These factors are not necessarily
all of the important factors that could cause our actual results to
differ materially from those expressed in any of our
forward-looking statements. Other unknown or unpredictable factors
also could have material adverse effects on our future results. The
forward-looking statements included in this release are made only
as of the date of this release. We cannot assure you that projected
results or events will be achieved. We do not intend, and do not
assume any obligation to update any industry information or
forward-looking information set forth in this release to reflect
subsequent events or circumstances.
****
This press release does not constitute an offer or invitation
to purchase any securities of Technip in the United States or any
other jurisdiction. Securities may not be offered or sold in the
United States absent registration or an exemption from
registration. The information contained in this presentation may
not be relied upon in deciding whether or not to acquire Technip
securities.
This presentation is being furnished to you solely for your
information, and it may not be reproduced, redistributed or
published, directly or indirectly, in whole or in part, to any
other person. Non-compliance with these restrictions may result in
the violation of legal restrictions of the United States or of
other jurisdictions.
****
°
° °
Technip is a world leader in project management, engineering and
construction for the energy industry.
From the deepest Subsea oil & gas developments to the
largest and most complex Offshore and Onshore infrastructures,
close to 31,000 people are constantly offering the best solutions
and most innovative technologies to meet the world’s energy
challenges.
Present in 45 countries, Technip has state-of-the-art industrial
assets on all continents and operates a fleet of specialized
vessels for pipeline installation and subsea construction.
Technip shares are listed on the Euronext Paris exchange, and
its ADR is traded in the US on the OTCQX marketplace as an American
Depositary Receipt (OTCQX: TKPPY).
ANNEX I (a) 1
ADJUSTED CONSOLIDATED STATEMENT OF
INCOME
Third Quarter
Not audited
9 Months
Not audited
€ million (except Diluted Earnings
perShare and Diluted Number of Shares)
2015 2016 Change
2015 2016 Change Revenue
3,108.9 2,919.4 (6.1)%
9,090.6 8,494.4 (6.6)%
Gross Margin 456.8 424.6 (7.0)% 1,059.4
1,227.9 15.9% Research & Development Expenses
(19.4) (19.7) 1.5% (61.0) (60.8) (0.3)%
SG&A and Other (150.9) (125.6) (16.8)% (459.8) (397.7) (13.5)%
Share of Income/(Loss) of Equity Affiliates 5.5 5.3
(3.6)% 22.2 11.5 (48.2)%
OIFRA after
Income/(Loss) of Equity Affiliates 292.0
284.6 (2.5)% 560.8
780.9 39.2% Non-Current Operating Result
(14.0) (21.6) 54.3% (417.8) (125.9) nm
Operating Income
278.0 263.0 (5.4)%
143.0 655.0 nm Financial Result
(39.2) 4.1 nm (106.5) (63.2) (40.7)%
Income/(Loss) before
Tax 238.8 267.1 11.9%
36.5 591.8 nm Income Tax
Expense (70.3) (83.4) 18.6% (84.2) (170.7) nm Non-Controlling
Interests (4.6) 0.6 nm (9.2) 0.9 nm
Net Income/(Loss) of the
Parent Company 163.9 184.3
12.4% (56.9) 422.0
nm
Diluted Number of Shares
125,439,384 126,896,391 1.2% 114,325,725
125,301,723 9.6%
Diluted Earnings per Share
(€) 1.35 1.46 8.0%
(0.50) 3.44 nm
1 Note that statements disclosed in annexes I(a) and I(c) do not
report underlying results. Please refer to annex V for the
underlying net income reconciliation.
IFRS CONSOLIDATED REVENUE AND NET
INCOME
Third Quarter
Not audited
9 Months
Not audited
€ million
2015 2016
Change 2015 2016
Change Revenue 2,608.6 2,126.3
(18.5)% 7,945.0 6,413.7
(19.3)%
Net Income/(Loss) of the Parent
Company
163.9 184.3 12.4%
(56.9) 422.0 nm
ANNEX I (b)
FOREIGN CURRENCY CONVERSION
RATES
Closing Rate as of
Average Rate of
Dec. 31,2015
Sep. 30,2016
3Q 2015 3Q 2016 9M 2015
9M 2016 USD for 1 EUR 1.09 1.12
1.11 1.12 1.11 1.12
GBP for 1
EUR 0.73 0.86 0.72 0.85 0.73
0.80
BRL for 1 EUR 4.31 3.62
3.94 3.62 3.52 3.96
NOK for 1 EUR
9.60 8.99 9.14 9.29 8.81
9.38
ANNEX I (c) 1
ADJUSTED ADDITIONAL INFORMATION BY
BUSINESS SEGMENT
Third Quarter
Not audited
9 Months
Not audited
€ million
2015 2016 Change
2015 2016 Change
SUBSEA
Revenue 1,547.0 1,397.2 (9.7)% 4,388.4
4,148.8 (5.5)% Gross Margin 301.0 288.2 (4.3)% 841.3 797.4 (5.2)%
OIFRA after Income/(Loss) of Equity Affiliates 232.0 229.1 (1.3)%
647.5 610.6 (5.7)% Operating Margin 15.0% 16.4% 140bp 14.8% 14.7%
(4)bp Depreciation and Amortization (70.4) (60.4) (14.2)% (194.1)
(175.8) (9.4)% EBITDA 302.4 289.5 (4.3)% 841.6 786.4 (6.6)% EBITDA
Margin 19.5% 20.7% 117bp 19.2%
19.0% (22)bp
ONSHORE/OFFSHORE
Revenue 1,561.9 1,522.2 (2.5)% 4,702.2 4,345.6 (7.6)% Gross Margin
155.8 136.4 (12.5)% 218.1 430.5 nm OIFRA after Income/(Loss) of
Equity Affiliates 75.5 70.3 (6.9)% (32.2) 213.5 nm Operating Margin
4.8% 4.6% (22)bp (0.7)% 4.9% nm Depreciation and Amortization
(9.4) (7.7) (18.1)% (29.2)
(25.1) (14.0)%
CORPORATE
OIFRA after Income/(Loss) of Equity Affiliates (15.5) (14.8) (4.5)%
(54.5) (43.2) (20.7)% Depreciation and Amortization -
- - - - -
1 Note that statements disclosed in annexes I(a) and I(c) do not
report underlying results. Please refer to annex V for the
underlying net income reconciliation.
ANNEX I (d)
ADJUSTED REVENUE BY GEOGRAPHICAL
AREA
Third Quarter
Not audited
9 Months
Not audited
€ million
2015 2016
Change 2015 2016
Change Europe, Russia, Central Asia 1,202.9
1,432.0 19.0% 3,385.6 3,810.8
12.6%
Africa 428.2 446.9 4.4%
1,371.9 1,341.9 (2.2)%
Middle East
193.0 133.1 (31.0)% 698.2 513.4
(26.5)%
Asia Pacific 581.6 315.9
(45.7)% 1,540.5 1,044.0 (32.2)%
Americas 703.2 591.5 (15.9)%
2,094.4 1,784.3 (14.8)%
TOTAL
3,108.9 2,919.4 (6.1)%
9,090.6 8,494.4 (6.6)%
ANNEX II
ADJUSTED CONSOLIDATED STATEMENT OF
FINANCIAL POSITION
Dec. 31, 2015
Audited
Sep. 30, 2016
Not audited
€ million Fixed Assets 6,507.9 6,277.4 Deferred Tax
Assets 481.8 471.9
Non-Current Assets
6,989.7 6,749.3 Construction Contracts –
Amounts in Assets 652.0 885.7 Inventories, Trade Receivables and
Other 3,366.5 3,651.8 Cash & Cash Equivalents 4,501.4
4,146.6
Current Assets 8,519.9
8,684.1 Assets Classified as Held for Sale
26.4 0.6 Total Assets
15,536.0 15,434.0
Shareholders’ Equity (Parent Company) 4,536.4 4,817.0
Non-Controlling Interests 8.5 19.5
Shareholders’
Equity 4,544.9 4,836.5 Non-Current
Financial Debts 1,626.0 1,560.8 Non-Current Provisions 243.0 210.7
Deferred Tax Liabilities and Other Non-Current Liabilities
215.0 195.0
Non-Current Liabilities
2,084.0 1,966.5 Current Financial Debts 937.1
761.9 Current Provisions 435.7 580.4 Construction Contracts –
Amounts in Liabilities 2,308.2 1,721.7 Trade Payables & Other
5,226.1 5,567.0
Current Liabilities
8,907.1 8,631.0 Total Shareholders’ Equity
& Liabilities 15,536.0 15,434.0
Net Cash Position
1,938.3 1,823.9 Adjusted
Statement of Changes in Shareholders’ Equity (Parent Company)
Not audited (€ million)
: Shareholders’ Equity as
of December 31, 2015 4,536.4 Net Income 422.0
Other Comprehensive Income 76.0 Capital Increase 136.6 Treasury
Shares (133.0) Dividends Paid (236.6) Other 15.6
Shareholders’
Equity as of September 30, 2016 4,817.0
ANNEX III (a)
ADJUSTED CONSOLIDATED STATEMENT OF CASH
FLOWS
9 Months
Not audited
€ million
2015 2016 Net Income/(Loss)
of the Parent Company (56.9) 422.0
Depreciation & Amortization of Fixed Assets 266.1 200.9 Stock
Options and Performance Share Charges 19.9 13.5 Non-Current
Provisions (including Employee Benefits) 145.3 (3.9) Deferred
Income Tax (72.8) (59.8) Net (Gains)/Losses on Disposal of Assets
and Investments (28.3) 15.5 Non-Controlling Interests and Other
13.4 18.1
Cash Generated from/(used in) Operations
286.7 606.3 Change in Working Capital
Requirements 123.0 (281.7) Net Cash
Generated from/(used in) Operating Activities 409.7
324.6
Capital Expenditures (218.2) (97.1) Proceeds from
Non-Current Asset Disposals 5.2 (71.3) Acquisitions of Financial
Assets (2.3) 0.0 Acquisition Costs of Consolidated Companies, Net
of Cash Acquired (31.7) 0.0
Net Cash Generated from/(used
in) Investing Activities (247.0) (168.4)
Net
Increase/(Decrease) in Borrowings (102.7) (287.9) Capital Increase
21.3 0.7 Dividends Paid (88.9) (100.8) Share Buy-Back and Other
(5.8) (135.7)
Net Cash Generated from/(used in) Financing
Activities (176.1) (523.7)
Net Effects of Foreign
Exchange Rate Changes 78.2 12.8 Net
Increase/(Decrease) in Cash and Cash Equivalents 64.8
(354.7)
Bank Overdrafts at Period Beginning (0.9) (0.1) Cash
and Cash Equivalents at Period Beginning 3,738.3 4,501.4 Bank
Overdrafts at Period End 0.0 0.0 Cash and Cash Equivalents at
Period End 3,802.2 4,146.6
64.8 (354.7)
ANNEX III (b)
ADJUSTED CASH & FINANCIAL
DEBTS
€ million
Dec. 31, 2015Audited
Sep. 30, 2016Not audited
Cash Equivalents 2,555.7 2,430.9 Cash 1,945.7 1,715.7
Cash &
Cash Equivalents (A) 4,501.4
4,146.6 Current Financial Debts 937.1 761.9 Non-Current
Financial Debts 1,626.0 1,560.8
Gross Debt (B)
2,563.1 2,322.7 Net Cash Position (A –
B) 1,938.3 1,823.9
ANNEX IVCONTRACT AWARDSNot
audited
The main contracts we announced during third quarter 2016
were the following:
Subsea Segment:
- A frame agreement to provide
Inspection, Repair and Maintenance (IRM) services for 2016 with
possible extension to include 2017 and 2018 on the client’s North
Sea subsea infrastructure. The frame agreement covers provision of
equipment, including diving equipment, underwater intervention and
engineering services, Onshore management and engineering support,
provision of ancillary personnel and equipment to support execution
of the work, diver inspection, ROV inspection, maintenance, repair,
construction and decommissioning. Repsol Sinopec Resources UK
Limited, UK,
- A large subsea contract for the
development of the Greater Enfield Project, covering project
management, design, engineering, procurement, installation and
pre-commissioning (EPIC) of carbon steel production flowline,
carbon steel water injection flowline, flexible risers and
flowlines, umbilicals, subsea structures and valves and multi-phase
pump system. The flexible pipes will be manufactured in Asiaflex,
located in Malaysia, the umbilicals will be supplied by Technip
Umbilicals’ facility located in Newcastle, UK and the offshore
installation at a water depth of between 340 and 850 meters will
use several vessels from Technip’s fleet. Woodside, North West
Shelf, Australia.
Onshore/Offshore Segment:
- A Master Services Agreement (MSA) for a
12 mtpa Liquefied Natural Gas (LNG) export terminal. The MSA will
be utilized to execute engineering services necessary to develop
the project including the Front End Engineering Design (FEED) and
supporting the Federal Energy Regulatory Commission (FERC) process.
SCT&E LNG Inc, Monkey Island, Louisiana, USA,
- A significant service contract awarded
to RusTechnip for the existing GazpromNeft Refinery covering the
engineering, procurement and construction management services
(EPsCm) for the construction of a new Crude Distillation Unit -
Vacuum Distillation Unit complex. PJSC GAZPROM NEFT, Omsk,
Russia,
- An exclusive cooperation agreement to
provide EPC services for its modular pyrolysis plants. The
plants will be based on BTL's Fast Pyrolysis Oil (FPO)
technology which converts biomass to oil through a rapid pyrolysis
process. The agreement combines Technip's global strength in
technology, engineering, procurement and construction with BTL's
experience in the design and commercial operation of one of the
world's first FPO production facilities. BTG BioLiquids B.V. (BTL),
Netherlands,
- A large contract, covering the EPC for
the design and construction of Jebel Ali new processing units and
ancillary units. The main package of the project will add a new
Condensate processing train to the existing facility, expanding its
daily capacity to 210,000 barrels, up from its existing current
140,000 barrels per day. ENOC, Dubai, United Arab Emirates.
Since September 30, 2016, Technip has also announced the
award of the following contracts, which were included in the
backlog as of September 30, 2016:
Subsea Segment:
- A contract for the Samarang
Redevelopment Project Phase 2 EOR, where Technip will manage the
engineering, supply, construction, installation and commissioning
(EPCIC) of flexible pipelines, with diameters ranging from 4” to
6”, as well as EPCIC of associated platform I-tubes. Petronas
Carigali Sdn Bhd, Malaysia.
Onshore/Offshore Segment:
- A contract to provide engineering and
procurement of three proprietary SMK™ grassroots furnaces. The
furnaces will be part of the existing ethylene plant at the site.
This project is another step in the client’s ongoing cracking
furnaces replacement program. This furnace type is particularly
suitable for cracking high-capacity, low-cost ethane and propane
gas feedstock. Kazanorgsintez, Kazan, Republic of Tatarstan,
Russia.
Since September 30, 2016, Technip has also announced the
award of the following contracts, which were not included in the
backlog as of September 30, 2016:
Subsea Segment:
- An important contract for the Dvalin
field development (previously named Zidane) covering a tieback from
a new 4-slot template to the Heidrun platform through a 15km long
Pipe-in-Pipe production line. The contract includes engineering,
procurement and installation of the pipelines, spools, riser bases
and PLEMs (pipeline end modules) as well as rock installation and
commissioning scope. Also included in the contract is the
installation of a control umbilical between Heidrun and the Dvalin
template. DEA Norge AS, Norway.
€ million
Third Quarter
2016
9 Months
2016
Net Income of the Parent Company
184.3 422.0 One-off charges in OIFRA 0.0
0.0 Charges from Non-Current Activities 9.0 98.5 Other 12.6
27.4 Taxes & Financial Result (2.7) (24.0)
Underlying
Net Income 203.2 523.9
View source
version on businesswire.com: http://www.businesswire.com/news/home/20161026006965/en/
TechnipAnalyst and Investor RelationsAurélia
Baudey-Vignaud, +33 (0) 1 85 67 43
81abaudeyvignaud@technip.comorElodie Robbe-Mouillot, +33 (0) 1 47
78 43 86erobbemouillot@technip.comorPublic RelationsLaure
Montcel, +33 (0)1 49 01 87 81orDelphine Nayral, +33 (0)1 47 78 34
83press@technip.comTechnip’s website
http://www.technip.comTechnip’s IR website
http://investors-en.technip.comTechnip’s IR mobile
website http://investors.mobi-en.technip.com
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