Slide 1: Q2 2018 Earnings Call Presentation
Q2 2018 Earnings Call Presentation July 26, 2018
Slide 2: Disclaimer
Disclaimer Forward-looking statements We would like to caution you with respect to any “forward-looking statements” made in this presentation as defined in Section 27A of the United States Securities Act of 1933, as amended, and Section 21E of the United States Securities Exchange Act of 1934, as am
Slide 3: Q2 2018 Overview
Q2 2018 Overview Financial Results and Operational Highlights Doug Pferdehirt, Chief Executive Officer Maryann Mannen, EVP and Chief Financial Officer
Slide 4: Financial highlights
Q2 2018 Financial highlights Total Company $3.0B REVENUE Subsea $1.2B, Onshore/Offshore $1.3B Surface Technologies $401M Total Company $377M Adjusted EBITDA(1) Operating segments $435M Total Company inbound orders $4.2B INBOUND ORDERS Subsea $1.5B, Onshore/Offshore $2.3B Surface Technologies $415M a
Slide 5: Key operational highlights
Q2 2018 Key operational highlights Orders drive backlog higher Surface Technologies recovers First iEPCI™ project completed 1.4 1.3 1.1 18.1% Shell 0.8 0.8 Adjusted EBITDA margin Kaikias 0.8 0.6 $15.2B Revenue by Geography $14.9B 0.3 $13.9B $14.0B International $13.0B Time to first America -0.2 Q217
Slide 6: Subsea opportunities in the next 24 months
Subsea opportunities in the next 24 months* EQUINOR Johan Sverdrup 2 CHEVRON Rosebank EXXONMOBIL CNOOC Neptun Deep Lingshui 17-2 RELIANCE WOODSIDE MJ-1 Sangomar CHEVRON Anchor & Tigris SHELL Bonga SW ONGC EXXONMOBIL INPEX KGD5 98/2 Liza 2 ENI Ichthys 2 Zabazaba CONOCOPHILLIPS TOTAL Barossa PETROBRAS
Slide 7: Time and Cost Savings
Integration drives sustainable improvements in project economics Integration maximizes cost and time savings Time and Cost Savings Kaikias iFEED™→ iEPCI™ Subsea 2.0™ “Bundled” Conventional Degree of integration Subsea market is moving towards greater project integration iFEED™ + Subsea 2.0™ + iEPCI™
Slide 8: Onshore/Offshore – differentiated growth opportunities
Onshore/Offshore – differentiated growth opportunities Process Technologies / PMC LNG Rising demand for petrochemicals Improving market dynamics ▪ Favorable feedstock to product differentials ▪ Rising FEED activity ▪ Technology definition and selection activity ▪ Increasing tendering opportuniti
Slide 9: Portfolio leverage to major energy growth platforms
Portfolio leverage to major energy growth platforms Subsea LNG Unconventional Product iEPCI™ 90 Mtpa reliability Transforming subsea Global production Leading positions in project economics delivered several products Subsea 2.0™ Revolutionary product 7.8 Mtpa Technology World’s largest LNG Extending
Slide 10: Financial highlights
Q2 2018 Financial highlights Revenue OTHER ITEMS $3.0 billion After-tax charges and (credits) of $26 million Corporate expense of $59 million, excluding charges and Adjusted EBITDA(1) $377 million (credits); includes $24 million, or $0.04 per diluted share, $435 million from Subsea, Onshore/Offs
Slide 11: Segment results
Q2 2018 Segment results Subsea Onshore/Offshore Surface Technologies USD, in millions USD, in millions USD, in millions 1,730 - 30% - 607 bps - 26% + 238 bps + 34% + 613 bps 21.8% 1,813 12.7% 401 18.1% 15.7% 1,342 1,217 10.4% 300 12.0% Revenue Adjusted EBITDA margin Revenue Adjusted EBITDA margin Re
Slide 12: Cash flow impacted by project timing and discretionary spend
Cash flow impacted by project timing and discretionary spend (in $ millions) 6,221 Discretionary Spend Cash required by operating activities of $(284) million; $295M working capital draw of $(477) million a function of project cycles Capital expenditures of $82 million 5,555 Discretionary spen
Slide 13: Backlog visibility
Backlog visibility Subsea(1) 2Q 2018 Inbound orders: $1,516 million Non-consolidated Backlog(2) $6.2 billion $2.3 billion Subsea $1.9 billion $2.0 billion 2018 (6 months) 2019 2018(3) $79 million 2020 & beyond (1) Backlog does not capture all revenue potential for subsea services. 2019 $167 million
Slide 14: 2018 Full Year Guidance
2018 Full Guidance(1) *Updated July 25, 2018 Subsea Onshore/Offshore Surface Technologies Revenue in a range of $5.0–5.3 billion Revenue in a range of $5.6–5.9* billion Revenue in a range of $1.5–1.6 billion EBITDA margin at least 14% (excluding EBITDA margin at least 12%* (excluding EBI
Slide 15: Summary
Summary Q2 2018 highlights Second quarter results support full-year 2018 outlook; guidance for Onshore/Offshore increased Total Company inbound orders of $4.2 billion; orders exceeded revenues in all segments Total Company backlog provides good revenue coverage for 2018; improving visibility f
Slide 16: Appendix
Appendix
Slide 17: Select financial data
Select financial data Three Months Ended Three Months Ended Revenue June 30, 2018 March 31, 2018 December 31, 2017 September 30, 2017 June 30, 2017 Inbound Orders (1) June 30, 2018 March 31, 2018 December 31, 2017 September 30, 2017 June 30, 2017 Subsea $ 1,217.4 $ 1,180.2 $ 1,292.2 $ 1,478.2 $ 1,73
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