Technipfmc Plc · NYSE:FTI
Technipfmc — Technip — Global Natural Resources Conference – Goldman Sachs 2016
68 slides from Technipfmc's conference presentation, Nov 9, 2016
Slide 1: Building Solutions for the Energy Industry
Building Click toSolutions fortext edit Master the Energy stylesIndustry Laurent Decoret – Group SVP Innovation & Technology Aurélia Baudey-Vignaud – Head of Investor Relations Global Natural Resources Conference – Goldman Sachs - London, November 9, 2016
Slide 2: Safe Harbor
Safe Harbor T his presentation 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 w
Slide 3: 3Q 2016 Highlights
3Q 2016 Highlights CLIENT Highly valued project management expertise and long- INSIGHT lasting customer relationships supported group profitability at c.10% Continued cost reductions to achieve €1 billion by 2017 EFFICIENCY of which €900 million in 2016 BALANCE Solid balance sheet with net cash at €
Slide 4: Project Execution and Cost Reduction Supporting Profitability
Project Execution and Cost Reduction Supporting Profitability Adjusted Adjusted Adjusted Order Intake Revenue OIFRA(1) Net Cash €1.5 billion €2.9 billion €285 million €1.8 billion Onshore / Offshore Subsea Group (1) Adjusted Underlying Operating Income from Recurring Activities after Income/(Loss) o
Slide 5: Sound Quarterly Order Intake Showcases Technip's Proven Strategy
Sound Quarterly Order Intake Showcases Technip’s Proven Strategy ALLIANCE Jebel Ali Refinery expansion Dvalin Lancaster Long-lasting client relationship Unique long tie-back solutions First Alliance award § Client: ENOC § Client: DEA Norge § Client: Hurricane § Large EPC(2) for the design § Importan
Slide 6: 3Q 2016 Operational and Financial Highlights
3Q 2016 Operational and Financial Highlights
Slide 7: €1 Billion Cost Reduction Plan On-Track
€1 Billion Cost Reduction Plan On-Track SG&A(1) accelerated decrease with (17)% SG&A(1) compared to 3Q15 reduction Fleet streamlining and improved efficiency § Olympic Challenger returned to owner in 3Q16 § €195 million OPEX savings expected in 2016 compared to 2014 Footprint Company rationalization
Slide 8: Backlog and Contracted Work Provides Visibility for 2017 and Beyond
Backlog and Contracted Work Provides Visibility for 2017 and Beyond Subsea 3Q 2016 Order Intake: €486 million €5.1 billion €1.0 billion €2.6 billion €1.5 billion 2016 (3 months) 2017 2018 & beyond Onshore & Offshore 3Q 2016 Order Intake: €1,028 million €7.2 billion €1.3 billion €3.6 billion €2.2 bil
Slide 9: 2016 Objectives: Guidance Upgrade
2016 Objectives: Guidance Upgrade Subsea - Upgraded § Adjusted revenue above €5.0 billion (previously between €4.7 and €5.0 billion) § Adjusted operating income from recurring activities(1) around €700 million (previously around €680 million) Onshore / Offshore - Unchanged § Adjusted revenue between
Slide 10: Technip in the Current Market Environment
Technip in the Current Market Environment
Slide 11: Yamal Project: 2016 Objectives Achieved
Yamal Project: 2016 Objectives Achieved Paving the Way to 2017 Train 1 Delivery Successful sail away of all 78 modules for Phase 1(1) § 75 modules (1) delivered and being installed in Sabetta, Russia FACTS KEY § Largest fleet of heavy carriers making successive shipments through the Northern Sea Rou
Slide 12: Differentiating Vessel Capabilities Supporting Pre-salt Development in Brazil
Differentiating Vessel Capabilities Supporting Pre-salt Development in Brazil Skandi Vitória Skandi Niterói § Renewed in May 2016 § Renewed in June 2016 Skandi Açu § Successful delivery on August 13, 2016 Estrela Do Mar Coral Do Atlantico § Chartered until 2024 § 650t crane vessel: largest tension c
Slide 13: Market Outlook
Market Outlook SHALLOW WATER CONTINUING GREENFIELD OPPORTUNITIES LNG DEVELOPMENT REFINING AND PETCHEM GREENFIELD & BROWNFIELD DOWNSTREAM OPPORTUNITIES RESILIENCE TIEBACK OPPORTUNITIES DOWNSTREAM GAS & DOWNSTREAM RESILIENCE FOCUS LIBRA & OTHER PRE-SALT LNG DEVELOPMENTS DEVELOPMENTS TIEBACK OPPORTUNIT
Slide 14: Integrated Solutions: A Proven Model
Integrated Solutions: A Proven Model Jangkrik, ENI, Indonesia TECHNOLOGY, EQUIPMENT & SUBSEA ONSHORE / OFFSHORE CONSULTING § Fabrication of flexibles and umbilical § Design, EPCI(1) and commissioning of § EPC(2) of onshore gas treatment plant flexibles and umbilical Juniper, BP, Trinidad & Tobago TE
Slide 15: Technip: Taking the Industry Further
Technip: Taking the Industry Further CLIENT Project management valued expertise, differentiating INSIGHT assets and solid track record best position Technip EFFICIENCY Cost reduction efforts to protect profitability BALANCE Shape the future sustainably for all our stakeholders SHEET BROAD-BASED Prov
Slide 16: Annex
Technip
Slide 17: Technip at a Glance
Technip at a Glance Technip
Slide 18: Technip: World Leader Bringing Innovative Solutions to the Energy Industry
Technip: World Leader Bringing Innovative Solutions to the Energy Industry § A world leader in project management, engineering and construction for oil & gas, chemicals and energy companies § ~31,000 people in 45 countries § 2015 Adjusted Revenue: €12 billion; Adjusted OIFRA (1): €802 million Subsea
Slide 19: Global Business with Unique Worldwide Footprint
Global Business with Unique Worldwide Footprint Evanton Technip Umbilicals(1) Ltd: Newcastle Orkanger Pori Stavanger North Sea Canada 1st office: St. Petersburg 1978 Aberdeen Oslo Zoetermeer Moscow North America 1st office: London Warsaw 1971 Flexi France: Paris Lyon Boston Le Trait Marseille Weymou
Slide 20: Worldwide Presence across Multiple Markets Addressing all Clients
Worldwide Presence across Multiple Markets Addressing all Clients Backlog of €12.3 billion diversified by geography and by market split Middle East Others 8% 1% Europe / Russia / Refining / Heavy Central Asia Deepwater Asia Pacific Oil / Petrochems 51% >1,000 meters* 11% 17% 23% Americas 16% Shallow
Slide 21: Pursue a Balance of Contract Sizes
Pursue a Balance of Contract Sizes(1) Subsea Onshore & Offshore § €5.1 billion backlog § €7.2 billion backlog § Largest projects: § Largest projects: § Kaombo, Angola § Yamal LNG, Russia § Bahr Essalam, Mediterranean Sea § Jebel Ali refinery expansion, UAE § Jangkrik, Indonesia § 7 projects in €100
Slide 22: Key Projects Worldwide
Key Projects Worldwide North Sea Canada § Åsgard Subsea Compression, Norway § Edradour & Glenlivet, Scotland § Kraken, Scotland Asia Pacific § Johan Sverdrup & Oseberg Vestflanken, Norway North America § Prelude FLNG, Australia § Sasol ethane cracker, Louisiana, USA § Wheatstone, Australia § Block S
Slide 23: Onshore/Offshore: Strong Enabler to Capture Downstream Market Resilience
Onshore/Offshore: Strong Enabler to Capture Downstream Market Resilience in 2016 & 2017 MIDOR refinery, Egypt Over 50 years of greenfield & § Involvement since refinery brownfield expertise construction in the 1990’s § Direct FEED award leading to EPC § Technip helped arrange ECA (1) and project fin
Slide 24: Technip Onshore Capabilities
Technip Onshore Capabilities Full Range of Expertise Gas Monetization Petrochemicals Refining Others § LNG(1) § Ethylene § Clean Fuels § Mining and Metals § NGL(2) § Polyolefins § Grassroots § Infrastructures § GTL(3) § Aromatics § Heavy Oil § Renewable Activities § Gas Treatment § Fertilizers § Upg
Slide 25: Technip Offshore Capabilities
Technip Offshore Capabilities Floating Platforms Fixed Platforms § Leader in FLNG with a combination of onshore and offshore § Small and large conventional platforms with topsides technologies installation by heavy lift vessel, floatover or crane § Delivered some of the world’s largest FPSOs § Desig
Slide 26: FLNG Leader with First Mover Advantage
FLNG Leader with First Mover Advantage Shell Prelude FLNG Q1 2013 Q3 2014 Q2 2016 Topside steel cut Furnace commissioning First topside installed Q4 2012 Q4 2013 Q4 2015 Q3 2016 Hull steel cut Launched Hull Turret mooring system Jumper installation and 135 meter flare § LNG capacity: 3.6 mtpa instal
Slide 27: Yamal LNG Project Overview
Yamal LNG Project Overview Project Overview § Client: Yamal LNG (Novatek, Total, CNPC, Silk Road Fund) § Technip leader of partnership (50%) with JGC (25%) & Chiyoda (25%) § 3 trains of 5.5 mtpa capacity each § ~ 200 modules weighing ~450,000 tons in total to be shipped to Sabetta § Early involvemen
Slide 28: Onshore/Offshore: Diversified Projects and Worldwide Footprint
Onshore/Offshore: Diversified Projects and Worldwide Footprint What we do Example of on-going projects Gas Monetization § Prelude FLNG, EPCI, Australia Gas treatment LNG(1) § Yamal LNG, EPC, Russia FLNG(2) Yemen LNG, Yemen GTL(3) Refining § RAPID, UIO (4), Malaysia Hydrogen § MIDOR Refinery, Early W
Slide 29: Technology, Equipment and Consulting
Technology, Equipment and Consulting How we built these businesses Partnerships Acquisitions Capex R&D § FMC Technologies § Stone & Webster § Asiaflex plant § Sustained investments in § RPS Group Process Technology § Açu plant 2015: €86 million § Sasol GTL(1) § Zimmer § Le Trait upgrade § Innovation
Slide 30: Integrated Subsea Solutions at Conceptual Stage
Integrated Subsea Solutions at Conceptual Stage (1) (2) Providing independent subsea architecture development and component Proprietary Technologies Improving equipment and installation selection converge in subsea architecture Electrically Trace In-line Monitoring Heated Pipe-in- Technologies pipe
Slide 31: Technology: A Clear Market Differentiator
Technology: A Clear Market Differentiator Sustained R&D Investments Examples of Subsea Technologies €86 million of § Electrically Trace € million R&D in 2015 Heated Pipe-in-Pipe 90 75 § Al Cable Power 60 Umbilical 45 Examples of Process Technologies 30 § DIESTA: Dual enhanced heat 15 transfer surfac
Slide 32: Technip Process Technology Diversifies Revenue Streams
Technip Process Technology Diversifies Revenue Streams Offering three types of services Licenses Process Design / Engineering Proprietary Equipment § Licensed proprietary § Process design packages / § Design, supply and installation technologies chosen at early engineering to guarantee plant of crit
Slide 33: Broad Offer of Technology, Equipment and Consulting Solutions
Broad Offer of Technology, Equipment and Consulting Solutions What we do Example of on-going projects Equipment § Libra and Lula Alto pre-salt flexible supply, Brazil Supply § Block 15/06 East Hub umbilical supply, Angola Le Trait, France § Shell frame agreement Early § Forsys FEEDs Involvement § Ge
Slide 34: Broad Execution Capabilities in Subsea
Broad Execution Capabilities in Subsea Heavy Lift J-Lay & S-Lay Reel-Lay J-Lay & Subsea Reel-Lay Heavy Lift Ultra-deep water infield lines Deepwater infield lines Deep-to-shore (Very high tensions: alliance with Heerema) 34 3Q 2016 Results
Slide 35: High Performing Fleet Per Type of Vessel
High Performing Fleet(1) Per Type of Vessel (2) Deep Orient Deep Pioneer North Sea Atlantic Flexible Lay Diving Multi & North Sea Giant Deep Arctic Support Construction Skandi Africa Vessel Wellservicer 10 vessels Coral Do Atlantico 3 vessels Orelia Estrela Do Mar Skandi Niteroi Skandi Vitoria Skand
Slide 36: Flexibility in Fleet Management
Flexibility in Fleet Management 2013 2014 2015 2016-2017 New +1 (Deep Arctic) +1 (Deep Explorer) Divested -8 -2 -2 Wholly-owned 19 11 10 9 New +2 +1 (Skandi Buzios) Divested -1 Jointly-owned 3 5 4 6 New +1 +1 (Skandi Africa) Divested -1 -1 -1-2 Leased 5 5 5 3-4 Under Construction 9 6 5 2 Total Fleet
Slide 37: West African Projects Driving Multiple Activities
West African Projects Driving Multiple Activities TEN, Ghana § Main offshore campaigns spread from Evanton Spoolbase 2015 to 2016 Pori Yard Fabrication and Construction spooling of rigid pipe § Main Technip vessels: Deep Energy, Technip Umbilicals Ltd Deep Pioneer Umbilical supply Moho Nord, Congo F
Slide 38: Leveraging our Broad-based Solutions: Mellitah, Bahr Essalam
Leveraging our Broad-based Solutions: Mellitah, Bahr Essalam Project Overview § Client: Mellitah Oil & Gas, a consortium between National Oil Corporation and ENI § Major natural gas field development tied back to the Sabratha platform in the Central Mediterranean Sea § Operations to be performed fro
Slide 39: Subsea: Multiple Projects Filling Plant & Assets Utilization
Subsea: Multiple Projects Filling Plant & Assets Utilization What we do Example of on-going EPCI projects Frontier Projects § Stones, GoM Ultra-deep water § Odd Job, GoM Skandi Vitoria, Brazil § South Santa Cruz and Barataria fields, GoM First Class § T.E.N., Ghana (with ) Partnerships § Kaombo, Ang
Slide 40: Technip: Long Term Partner
Technip: Long Term Partner(1) § Serimax § Heerema A strategic partnership to invest in joint R&D Alliance through combination of unique assets programs and innovative reel-lay welding and engineering resources to help clients best solutions to meet the growing technical address the fast growing subs
Slide 41: TechnipFMC Merger at a Glance
TechnipFMC Merger at a Glance
Slide 42: TechnipFMC: Broadest Portfolio of Solutions for Oil and Gas
TechnipFMC: Broadest Portfolio of Solutions for the Production and Transformation of Oil and Gas ONSHORE/OFFSHORE Deepwater Mining & Metals Shallow Water LNG FLNG Petrochemicals Refining & Hydrogen SURFACE Surface Production & Drilling Systems SUBSEA Jetty Loading Arms Life of field and monitoring S
Slide 43: Key Terms of the Transaction
Key Terms of the Transaction Transaction § TechnipFMC incorporated in the U.K. Structure § U.S. reverse triangular merger for FMC Technologies and European cross-border merger for Technip All-Stock Merger Listing § Shares listed on the NYSE and Euronext Paris with TechnipFMC seeking inclusion in S&P
Slide 44: The Future Executive Leadership Team
The Future Executive Leadership Team 44
Slide 45: Good Progress on Technip and FMC Technologies Merger Process
Good Progress on Technip and FMC Technologies Merger Process October 24, 2016 October 7, 2016 French foreign May 19, 2016 US foreign investment Combination investment approval (MINEFI) Early 2017 announcement approval (CFIUS) Expected October 25, 2016 combination October 4, 2016 October 24, 2016 Doc
Slide 46: Supported by Most Recent Achievements of the Alliance
Supported by Most Recent Achievements of the Alliance ALLIANCE First Alliance Award Unique Subsea Integrated Design 20 17 § Client: Hurricane No. of FEED Studies 15 10 § Alliance selected as exclusive provider of subsea solutions for the Lancaster 5 EPS(1) and for subsequent development of the Great
Slide 47: Diversified Mix of Integrated FEED Studies
Diversified Mix of Integrated FEED Studies Forsys Subsea studies by type Customer Type Scope (Tree Count) Field Type NOCs 21+ XTs Independents 1-10 XTs Brownfield Greenfield 11-20 XTs IOCs Relationships Geography Africa GOM Non- Alliance alliance Asia Pacific North Sea The Forsys Subsea studies cove
Slide 48: TechnipFMC is the Sole Player Offering Full Suite of Capabilities
TechnipFMC is the Sole Player Offering Full Suite of Capabilities Conceptual Design Life-of-Field Project Execution Decommissioning & FEED & Maintenance Equipment Engineering Procurement Construction Installation Rationalized supply Maximised subsea reliability and architecture Unique asset and upti
Slide 49: Reinvent Products
Reinvent Products Compact Subsea Manifold § Reduce product complexity with proprietary technology § Create differentiated products that focus on deliverability and installability § Case Study: Traditional versus Compact Subsea Manifold § Simplicity – 50% fewer parts § Deliverability – 50% schedule r
Slide 50: Integrate Complementary Technologies
Integrate Complementary Technologies Subsea processing Connector Manifold ETH PiP(1) Flexible pipe Direct Tie-In Increased Optimized Simplified efficiency connectivity architecture (1) ETH PiP: Electrically Trace Heated Pipe-in-Pipe 50
Slide 51: Offshore Remains Critical to the Future
Offshore Remains Critical to the Future… ~36 Million Barrels / Day of Incremental Production …With a Large Portion to Come from Deepwater Required by 2025e… MMb/d MMb/d 12.0 110 ~8.5 10.0 100 8.0 90 6.0 80 4.0 70 2.0 60 0.0 2016 2025 2015 Decline Incremental 2025 Current Sources of Production Deepwa
Slide 52: …and It Accounts for Majority of Majors' Production
…and It Accounts for Majority of Majors’ Production …While More Than 50% of the Majors’ 2P Reserves Offshore Contributes Significantly to Majors’ Production… Remaining Is Offshore 2016 Production by Classification (%) (1) Remaining 2P Reserves by Classification (%) (1) 100% 100% 4% 10% 15% 16% 18% 3
Slide 53: SPS and SURF Remain Critical Components of Offshore Development
SPS and SURF Remain Critical Components of Offshore Development SPS and SURF components represent up to 1/3rd of deepwater development costs and remain well-positioned for a market recovery given the importance of offshore production to future hydrocarbon supply SPS / SURF is One of the Largest Comp
Slide 54: Significant Potential for Cost Synergies
Significant Potential for Cost Synergies… Pre-Tax Cost Synergies of approximately $400m expected by 2019 Supply Chain § Commodity raw material cost savings Base plan Stretch § Better terms with shared suppliers § Beneficial scale effect from § Additional cost higher volumes reduction opportunities C
Slide 55: Clear Leadership and Balanced Governance
Clear Leadership and Balanced Governance Board of Directors Technip FMC Technologies Board of Directors Douglas Pferdehirt Thierry Pilenko 14 Board members with an equal number of Technip and FMC Technologies appointees Management Team Thierry Pilenko Douglas Pferdehirt Executive Chairman Chief Exec
Slide 56: Strong Financial Profile
Strong Financial Profile TechnipFMC Backlog $16bn $4bn c.$20bn Revenue $13.5bn $6.4bn c.$20bn EBITDA¹ $1.4bn $1.0bn $2.4bn Margin (%) 10.6% 15.2% 12.1% Gross Cash $4.7bn $1.0bn $5.7bn Position Attractive shareholder return policy Shareholder Offer shareholders an attractive and Share repurchase incl
Slide 57: TechnipFMC: Driving Change by Redefining Oil & Gas Production
TechnipFMC: Driving Change by Redefining the Production and Transformation of Oil & Gas Builds a comprehensive and flexible offering across each market from concept to project delivery and beyond Products: best-in-class equipment and systems provider § Leading and highly complementary equipment offe
Slide 58: Technip Financials
Technip Financials Technip
Slide 59: P&L Performance: Group OIFRA at c.10%
P&L Performance: Group OIFRA at c.10% Y-o-Y Y-o-Y 3Q Revenue 9M 15(1) 9M 16(1) € million 3Q 15(1) 3Q 16(1) § Subsea (10)% Change Change § 86% vessel utilization § Completion of T.E.N. in Ghana 9,091 8,494 (7)% Revenue 3,109 2,919 (6)% § Large projects such as Kaombo still in early phases § Onshore/O
Slide 60: Resilient Cash Flow Conversion
Resilient Cash Flow Conversion Adjusted Net Cash Bridge € million 110 282 (589) (35) (136) 2,192 1,824 Adjusted net Cash from Other working Net Capex Share buy-back Adjusted net cash June 2016 operations capital construction cash Sept. 2016 contracts Adjusted Net cash of €1.8 billion end of Septembe
Slide 61: Margins Performance 2015-2016 Year-to-date
Margins Performance 2015-2016 Year-to-date Adjusted Adjusted OIFRA margin(1) OIFRA margin(1) Subsea Onshore/Offshore 4.8% 5.1% 5.1% 16.1% 16.4% 4.1% 15.0% 14.6% 4.6% 13.7% 3.4% 12.8% 13.1% 1.5% 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 (1) Adjusted Underlying Operating In
Slide 62: Cost Reduction Delivery Ahead of Schedule
Cost Reduction Delivery Ahead of Schedule: €900 million to be Achieved in 2016 Total accumulated cost savings € billion €900 Over million €1 billion (0.27) 2015 cost savings (0.63) ~(0.10) 2016 4.79 cost 4.52 savings 3.89 ~3.79 2014 2016 2017 2015 Baseline (*) Objective(*) Objective(*) Over €1bn sav
Slide 63: Consolidated P&L
Consolidated P&L Third Quarter 9 months Not audited Not audited € million (except Diluted Earnings per Share 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)% Subsea 1,547.0 1,397.2 (9.7)% 4,388.4 4,148.8 (5.5)% Onshore/Offshore 1,5
Slide 64: Adjusted Consolidated Statement of Financial Position
Adjusted Consolidated Statement of Financial Position June 30, September 30, € million 2016 2016 Fixed Assets 6,363.8 6,277.4 Deferred Tax Assets 508.4 471.9 Non-Current Assets 6,872.2 6,749.3 Construction Contracts – Amounts in Assets 647.8 885.7 Inventories, Trade Receivables and Other 3,618.3 3,6
Slide 65: Adjusted Consolidated Statement of Cash Flows
Adjusted Consolidated Statement of Cash Flows 9 Months 9 Months € million Not Audited Not audited 2015 2016 Net Income/(Loss) of the Parent Company (56.9) 422.0 Depreciation & Amortization of Fixed Assets 266.1 200.9 Stocks Options and Performance Share Charges 19.9 13.5 Non-Current Provisions (incl
Slide 66: Shareholding Structure, May 2016
Shareholding Structure, May 2016 (November 2015) Treasury Shares North America 0.6% / (0.7%) 27.3% / (37.3%) Others 12.3% / (4.7%) IFP Energies Nouvelles 2.3% / (2.4%) Employees Rest of World* 2.8% / (1.7%) 19.0% / (19.0%) BPI 5.0% / (5.3%) Individual Shareholders French Institutional Investors 7.2%
Slide 67: Technip's Share Information
Technip’s Share Information ISIN: FR0000131708 Bloomberg: TEC FP Reuters: TECF.PA SEDOL: 4874160 OTC ADR ISIN: US8785462099 OTCQX: TKPPY Convertible Bonds: OCEANE 2011 ISIN: FR0011163864 67 3Q 2016 Results
Slide 68: Technip has a sponsored Level 1 ADR
§ Technip has a sponsored Level 1 ADR § Bloomberg ticker: TKPPY § CUSIP: 878546209 § OTC ADR ISIN: US8785462099 § ADR ratio: 1 ORD: 4 ADRs § Depositary bank: § Citibank Shareholder Services § Depositary bank contacts: § ADR broker helpline: § London: +44 207 547 6500 michael.woods@citi.com § New Yor
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