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What Drove TechnipFMC’s Second-Quarter Earnings?

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Dec. 4 2020, Updated 10:52 a.m. ET

TechnipFMC’s revenues and net income in Q2 2018

TechnipFMC (FTI) released its Q2 2018 financial results on July 25. In the second quarter, TechnipFMC recorded total revenues of ~$2.96 billion, down 23% from ~$3.85 billion in Q2 2017. In Q2 2018, FTI’s reported net income was $105.7 million, a 36% deterioration over Q2 2017 when FTI reported $164.9 million in net income.

In comparison, Schlumberger’s (SLB) year-over-year revenues increased 11.3% in Q2 2018, while Baker Hughes’s (BHGE) year-over-year revenues increased 2.5% on a combined business basis. Halliburton’s (HAL) second-quarter revenues increased 24% compared to a year ago.

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Negative drivers                                   

  • The downturn in the offshore and subsea energy market continued to affect FTI negatively in Q2 2018.
  • Prior-period declines in inbound orders related to the market downturn affected Q2 2018 revenues negatively.
  • Various international projects nearing completion affected FTI’s financial results negatively.

Positive drivers

  • higher project activity in Asia-Pacific and Europe, Middle East, India, and Africa
  • increase in demand for hydraulic fracturing services, wellhead systems, and pressure control equipment, and services
  • inbound orders in the Onshore/Offshore segment more than doubled in the second quarter compared to a year ago
  • improved cost structure due to cost reduction activities
  • higher vessel utilization in the Subsea segment
  • benefits of merger synergy following merger of Technip and FMC Technologies.

For more detail, read Market Realist’s Technip-FMC Technologies Merger: Reaching the Finale.

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