Technip posts rise in profit

Technip personnel31 October 2013, News Wires – French engineering giant Technip saw profits rise slightly during the third quarter of the year as revenue climbed.

The company’s net income for the three months to 30 September totalled €150 million ($205.5 million), up 1.9% on the €147.2 million booked during the same period last year.

The upward trend in profits came as revenue climbed 15.6% year-on-year, from nearly €2.1 billion in the third quarter of 2012 to more than €2.4 billion this year.

Order intake during the recent quarter totalled more than €3.1 billion, up from 2012’s third quarter order intake of €2.8 billion.

While overall results were positive, Technip noted foreign exchange had dragged down its revenue about €150 million year-on-year, while it also had a negative affect on operating income from recurring activities, estimated at about €30 million.

Technip chief executive Thierry Pilenko said the company’s performance was contrasted between its two business segments, with the onshore/offshore division reporting a 30% jump in revenue with margins of 6.6%, while the subsea segment only booked a 2% climb in revenue, albeit with margins of 14.7%.

He added that the contrast in the company’s activities was likely to continue for the remainder of the year.

“The fourth quarter in subsea will see a busier schedule of installation operations in the US Gulf of Mexico than planned,” Pilenko said.

“As a result, there is an increased dependence in the region on managing schedule conflicts, on which we are actively working with our customers, as well as on the performance of the Deep Energy vessel on her first projects.

“Operations in other regions have been successful over the last quarter but the US Gulf of Mexico is important for segment profitability in the fourth quarter as there is a lower level of subsea installation activity in those other regions.”

Technip revised its full year guidance, with the onshore/offshore segment expected to post full year revenues and margins towards the top end of the company’s target range, with revenues of about €5.2 billion, and operating margins between 6.5% and 7%.

It did however lower its full year target for subsea operating margin and revenue to 14% and €4.1 billion respectively.

“The fourth quarter revenues and currency impacts will hold back profitability and full year subsea margins,” Pilenko said.

“Our revised guidance for both segments also assumes that foreign exchangemovements will affect revenue and margin in a similar way as in the third quarter.”

As of 30 September the company’s order backlog stood at €15.9 billion, compared to €13.5 billion at the same point last.

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