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TechnipFMC plc (FTI) Stock Up 3.6% Despite Wider Q1 Loss
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TechnipFMC plc’s (FTI - Free Report) stock has gone up 3.6% since the first-quarter 2022 earnings announcement on Apr 27.
Despite the first-quarter loss being wider than the consensus mark and revenues lagging estimates, this stock performance could be attributed to the improving fundamentals of the company, backed by a year-over-year rise in inbound orders and backlog.
Behind the Earnings Headlines
TechnipFMC reported a first-quarter 2022 adjusted loss of 3 cents per share, in line with the year-ago quarter but wider than the Zacks Consensus Estimate of a loss of 1 cent. This underperformance was due to lower-than-anticipated earnings from the Subsea and Surface Technologies segments.
Adjusted EBITDA from the Subsea unit totaled $129 million, falling short of the Zacks Consensus Estimate of $132 million, while the Surface Technologies unit’s profit came in at $22 million, lagging the Zacks Consensus Estimate of $26.36 million.
For the quarter ended Mar 31, this seabed-to-surface oilfield equipment and services provider’s revenues of $1.56 billion missed the Zacks Consensus Estimate by 1.58% and also declined from the year-ago quarter’s $1.63 billion.
Giving some respite to investors, FTI’s first-quarter inbound orders increased 23.3% from the year-ago period’s level to almost $2.2 billion, reflecting strong revenue visibility.
Also, the company’s backlog rose. As of March end, TechnipFMC’s order backlog stood at $8.89 billion, improving about 23.2% from the 2021 reading.
Subsea: Revenues in the quarter under review were $1.29 billion, down 7% from the year-ago sales figure of $1.39 billion, due to reduced activities in Africa. However, adjusted EBITDA was reported at $129 million, down by about 4.5% from the year-ago quarter’s level, due to higher depreciation and amortization. The quarterly inbound orders jumped 24.7% to $1.89 billion, while the backlog rose 12.9%.
Surface Technologies: This smaller segment of the company recorded revenues of $266.7 million, up 8.6% year over year, primarily due to growth in North America, which benefited from the continued increase in drilling and completion activity. However, the unit’s adjusted EBITDA decreased by 18.2% to $22 million due to lower international revenues and the impacts of the manufacturing transition. The segment’s inbound orders rose 43.3%, while the quarter-end backlog increased 216.4%.
Financials
In the reported quarter, TechnipFMC spent $27.3 million on capital programs. As of Mar 31, the company had cash and cash equivalents of $1.2 billion and long-term debt of $1.72 billion, with a debt-to-capitalization of 33%.
2022 Outlook
TechnipFMC retained revenue expectations from the Subsea unit in the $5.2-$5.6 billion range for 2022 and maintained the 2022 Surface Technologies unit revenue guidance between $1.15 and $1.30 billion and an EBITDA margin in the range of 11%-12%.
This London-based oilfield services provider maintained that its free cash flow generation projection for 2022 is expected in the $100-$250 million band. The company guided to an annual capital expenditure view of $230 million and net interest expenses between $105 and $115 million.
Zacks Rank & Key Picks
TechnipFMC currently carries a Zacks Rank #3 (Hold). Some better-ranked players from the energy space that recently came out with their earnings reports include Hess Corporation (HES - Free Report) , Cenovus Energy (CVE - Free Report) and Chevron Corporation (CVX - Free Report) . While Hess and Cenovus each sport a Zacks Rank #1 (Strong Buy), Chevron carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Hess reported first-quarter 2022 earnings per share (EPS) of $1.30, beating the Zacks Consensus Estimate of $1.12. Higher commodity price realizations backed the strong quarterly results.
As of Mar 31, 2022, Hess had $1,370 million in cash and cash equivalents. HES’ long-term debt was $7,934 million at the first-quarter end. The current maturity of the long-term debt is $22 million.
Cenovus Energy reported first-quarter 2022 EPS of 62 cents, missing the Zacks Consensus Estimate of 83 cents. Lower-than-expected earnings can be attributed to increased transportation and blending costs and expenses for purchased products.
As of Mar 31, 2022, Cenovus had cash and cash equivalents of C$3,399 million. The total long-term debt was C$11,744 million. CVE increased the quarterly base dividend to 10.5 Canadian cents per share, suggesting a 200% increase from 3.5 Canadian cents per share.
Chevron reported adjusted first-quarter EPS of $3.36, missing the Zacks Consensus Estimate of $3.44 on the weaker-than-expected performance in the downstream segment.
As of Mar 31, Chevron had $11.7 billion in cash and cash equivalents and total debt of $29.3 billion, with a debt-to-total capitalization of 16.7%. CVX paid out $2.7 billion in dividends and bought back $1.3 billion worth of its shares.
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TechnipFMC plc (FTI) Stock Up 3.6% Despite Wider Q1 Loss
TechnipFMC plc’s (FTI - Free Report) stock has gone up 3.6% since the first-quarter 2022 earnings announcement on Apr 27.
Despite the first-quarter loss being wider than the consensus mark and revenues lagging estimates, this stock performance could be attributed to the improving fundamentals of the company, backed by a year-over-year rise in inbound orders and backlog.
Behind the Earnings Headlines
TechnipFMC reported a first-quarter 2022 adjusted loss of 3 cents per share, in line with the year-ago quarter but wider than the Zacks Consensus Estimate of a loss of 1 cent. This underperformance was due to lower-than-anticipated earnings from the Subsea and Surface Technologies segments.
Adjusted EBITDA from the Subsea unit totaled $129 million, falling short of the Zacks Consensus Estimate of $132 million, while the Surface Technologies unit’s profit came in at $22 million, lagging the Zacks Consensus Estimate of $26.36 million.
For the quarter ended Mar 31, this seabed-to-surface oilfield equipment and services provider’s revenues of $1.56 billion missed the Zacks Consensus Estimate by 1.58% and also declined from the year-ago quarter’s $1.63 billion.
Giving some respite to investors, FTI’s first-quarter inbound orders increased 23.3% from the year-ago period’s level to almost $2.2 billion, reflecting strong revenue visibility.
Also, the company’s backlog rose. As of March end, TechnipFMC’s order backlog stood at $8.89 billion, improving about 23.2% from the 2021 reading.
TechnipFMC plc Price, Consensus and EPS Surprise
TechnipFMC plc price-consensus-eps-surprise-chart | TechnipFMC plc Quote
Segment Analysis
Subsea: Revenues in the quarter under review were $1.29 billion, down 7% from the year-ago sales figure of $1.39 billion, due to reduced activities in Africa. However, adjusted EBITDA was reported at $129 million, down by about 4.5% from the year-ago quarter’s level, due to higher depreciation and amortization. The quarterly inbound orders jumped 24.7% to $1.89 billion, while the backlog rose 12.9%.
Surface Technologies: This smaller segment of the company recorded revenues of $266.7 million, up 8.6% year over year, primarily due to growth in North America, which benefited from the continued increase in drilling and completion activity. However, the unit’s adjusted EBITDA decreased by 18.2% to $22 million due to lower international revenues and the impacts of the manufacturing transition. The segment’s inbound orders rose 43.3%, while the quarter-end backlog increased 216.4%.
Financials
In the reported quarter, TechnipFMC spent $27.3 million on capital programs. As of Mar 31, the company had cash and cash equivalents of $1.2 billion and long-term debt of $1.72 billion, with a debt-to-capitalization of 33%.
2022 Outlook
TechnipFMC retained revenue expectations from the Subsea unit in the $5.2-$5.6 billion range for 2022 and maintained the 2022 Surface Technologies unit revenue guidance between $1.15 and $1.30 billion and an EBITDA margin in the range of 11%-12%.
This London-based oilfield services provider maintained that its free cash flow generation projection for 2022 is expected in the $100-$250 million band. The company guided to an annual capital expenditure view of $230 million and net interest expenses between $105 and $115 million.
Zacks Rank & Key Picks
TechnipFMC currently carries a Zacks Rank #3 (Hold). Some better-ranked players from the energy space that recently came out with their earnings reports include Hess Corporation (HES - Free Report) , Cenovus Energy (CVE - Free Report) and Chevron Corporation (CVX - Free Report) . While Hess and Cenovus each sport a Zacks Rank #1 (Strong Buy), Chevron carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Hess reported first-quarter 2022 earnings per share (EPS) of $1.30, beating the Zacks Consensus Estimate of $1.12. Higher commodity price realizations backed the strong quarterly results.
As of Mar 31, 2022, Hess had $1,370 million in cash and cash equivalents. HES’ long-term debt was $7,934 million at the first-quarter end. The current maturity of the long-term debt is $22 million.
Cenovus Energy reported first-quarter 2022 EPS of 62 cents, missing the Zacks Consensus Estimate of 83 cents. Lower-than-expected earnings can be attributed to increased transportation and blending costs and expenses for purchased products.
As of Mar 31, 2022, Cenovus had cash and cash equivalents of C$3,399 million. The total long-term debt was C$11,744 million. CVE increased the quarterly base dividend to 10.5 Canadian cents per share, suggesting a 200% increase from 3.5 Canadian cents per share.
Chevron reported adjusted first-quarter EPS of $3.36, missing the Zacks Consensus Estimate of $3.44 on the weaker-than-expected performance in the downstream segment.
As of Mar 31, Chevron had $11.7 billion in cash and cash equivalents and total debt of $29.3 billion, with a debt-to-total capitalization of 16.7%. CVX paid out $2.7 billion in dividends and bought back $1.3 billion worth of its shares.