TechnipFMC ((FTI)) has held its Q4 earnings call. Read on for the main highlights of the call.
TechnipFMC’s recent earnings call exuded a strong positive sentiment, driven by impressive growth in orders, revenue, and EBITDA. The company’s robust operational execution, particularly in the Subsea and iEPCI segments, along with the success of the Subsea 2.0 platform, were highlighted as key contributors to this sentiment. Despite some declines in Surface Technologies revenue and Subsea EBITDA margin, the overall financial results and strategic achievements, including increased shareholder returns and a positive outlook for energy markets, painted a favorable picture.
Record Order Inbound and Revenue Growth
TechnipFMC reported a remarkable total company inbound of $11.6 billion for the full year, which propelled the year-over-year growth in backlog to $14.4 billion. The company’s total revenue for the year saw a 16% increase, reaching $9.1 billion, showcasing its strong market position and operational efficiency.
Significant Growth in Subsea and iEPCI Orders
The Subsea segment saw inbound orders rise to $10.4 billion, marking the fourth consecutive year with a book-to-bill ratio greater than one. Additionally, iEPCI orders experienced nearly 25% year-over-year growth, reaching an all-time high, underscoring the company’s strategic focus and market demand for its offerings.
Strong Financial Performance
TechnipFMC’s adjusted EBITDA improved significantly to nearly $1.4 billion, representing a 47% increase compared to the previous year. The company’s full-year free cash flow also grew by 45% to $679 million, highlighting its solid financial health and operational success.
Subsea 2.0 Platform Success
The Subsea 2.0 platform demonstrated strong market adoption, with orders in 2024 significantly outpacing the more than 50% growth of total Subsea awards versus the prior year. This success reflects the platform’s innovative edge and the company’s ability to meet market needs.
Positive Outlook for Energy Markets
TechnipFMC remains optimistic about the energy market’s future, anticipating further growth in demand. Over the past two years, the company has secured $20.2 billion in Subsea orders, reinforcing its confidence in sustained market expansion.
Increased Shareholder Returns
The company returned $486 million to shareholders, nearly doubling the distribution from the previous year. TechnipFMC plans to distribute at least 70% of free cash flow in 2025, demonstrating its commitment to enhancing shareholder value.
Decline in Surface Technologies Revenue
Surface Technologies revenue experienced a 9% decline compared to the previous year. However, excluding the impact of the sale of the Measurement Solutions business, revenue saw a slight increase of 1%, indicating resilience in the face of market challenges.
Subsea Adjusted EBITDA Margin Decrease
The Subsea adjusted EBITDA margin decreased to 16.5%, down 180 basis points from the third quarter. This was attributed to seasonally lower vessel-based activity and a mix of projects executed from backlog, highlighting areas for potential improvement.
Forward-Looking Guidance
Looking ahead, TechnipFMC provided detailed guidance for 2025, expecting Subsea revenue to reach $8.6 billion with an adjusted EBITDA margin of 19.5%. This reflects a 10% revenue growth and a 28% adjusted EBITDA growth compared to 2024. Surface Technologies is projected to achieve $1.275 billion in revenue with a 15.5% adjusted EBITDA margin. Overall, the company anticipates high single-digit total company revenue growth and an adjusted EBITDA increase to approximately $1.76 billion for the full year. They also plan to convert over 50% of adjusted EBITDA into free cash flow, with shareholder distributions expected to grow by at least 30% in 2025.
In summary, TechnipFMC’s earnings call highlighted a strong financial performance and strategic achievements, contributing to a positive sentiment. The company’s growth in orders and revenue, along with its forward-looking guidance, underscores its robust market position and optimistic outlook for the future.