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TechnipFMC (FTI) Q1 Earnings Miss Estimates, Sales Beat
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TechnipFMC plc (FTI - Free Report) reported first-quarter 2023 breakeven adjusted earnings. The Zacks Consensus Estimate was pegged at a profit of 3 cents. The underperformance was due to higher total costs and expenses.
However, the bottom line improved from the year-ago quarter’s reported loss of 3 cents per share. The improvement can be attributed to better-than-expected performances of the Subsea and Surface Technologies segments.
Adjusted EBITDA for the Subsea unit totaled $142 million, which missed the Zacks Consensus Estimate of $147 million. The same for the Surface Technologies unit came in at $40.3 million, which beat the consensus mark of $35.21 million.
Revenues of $1.7 billion beat the Zacks Consensus Estimate by 2.6%. The top line also increased from the year-ago quarter’s reported figure of $1.56 billion.
FTI’s first-quarter inbound orders improved 30.8% to almost $2.9 billion from the year-ago period’s level. This indicates strong revenue visibility.
As of March end, order backlog was $10.6 billion, implying an almost 19.2% improvement from the prior-year quarter’s reading.
Subsea: Revenues in this segment were $1.4 billion, up 7.8% from the year-ago quarter’s recorded figure of $1.3 billion. This was primarily due to an increase in project activities in Brazil and the Gulf of Mexico.
Adjusted EBITDA was $142 million, up about 10% from the year-ago quarter’s level.Inbound orders increased 34% to $2.54 billion. Backlog rose 21.3%.
Surface Technologies: This segment recorded revenues of $329.8 million, up 23.6% year over year. This was primarily due to growth in North America, which benefited from the continued increase in drilling and completion activities. The unit’s adjusted EBITDA increased 83.1% to $40.3 million. The segment’s inbound orders rose 10.6%. The quarter-end backlog increased 5.1%.
Financials
During the reported quarter, TechnipFMC spent $57.3 million on capital programs. As of Mar 31, the company had cash and cash equivalents of $522.3 million and long-term debt of $1 billion, with a debt-to-capitalization of 23.9%.
2023 Outlook
TechnipFMC retained its revenue expectations from the Subsea unit in the $5.9-$6.3 billion range. It also maintained its revenue guidance for the Surface Technologies unit between $1.3 billion and $1.45 billion. EBITDA margin is expected in the band of 12-14%.
The company reiterated its free cash flow generation guidance in the $225-$375 million range. It also maintained its annual capital expenditure projection of $250 million and net interest expenses view of $100-$110 million.
Par Pacific: PARR is worth approximately $1.63 billion. Its shares have risen 82.1% in the past year.
The company manages and maintains interests in energy and infrastructure businesses. Its operating segment consists of refining, retail and logistics.
Marathon Petroleum: MPC is valued at around $58.02 billion. It delivered an average earnings surprise of 20.91% for the last four quarters and its current dividend yield is 2.30%.
The company currently has a forward P/E ratio of 6.36. In comparison, its industry has an average forward P/E of 9.10, which means MPC is trading at a discount to the group.
Ranger Energy Services: RNGR is valued at around $242.99 million. In the past year, its shares have gained 16.8%.
Ranger Energy Services currently has a forward P/E ratio of 5.30. In comparison, its industry has an average forward P/E of 11.60, which means RNGR is trading at a discount to the group.
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TechnipFMC (FTI) Q1 Earnings Miss Estimates, Sales Beat
TechnipFMC plc (FTI - Free Report) reported first-quarter 2023 breakeven adjusted earnings. The Zacks Consensus Estimate was pegged at a profit of 3 cents. The underperformance was due to higher total costs and expenses.
However, the bottom line improved from the year-ago quarter’s reported loss of 3 cents per share. The improvement can be attributed to better-than-expected performances of the Subsea and Surface Technologies segments.
Adjusted EBITDA for the Subsea unit totaled $142 million, which missed the Zacks Consensus Estimate of $147 million. The same for the Surface Technologies unit came in at $40.3 million, which beat the consensus mark of $35.21 million.
Revenues of $1.7 billion beat the Zacks Consensus Estimate by 2.6%. The top line also increased from the year-ago quarter’s reported figure of $1.56 billion.
FTI’s first-quarter inbound orders improved 30.8% to almost $2.9 billion from the year-ago period’s level. This indicates strong revenue visibility.
As of March end, order backlog was $10.6 billion, implying an almost 19.2% improvement from the prior-year quarter’s reading.
TechnipFMC plc Price, Consensus and EPS Surprise
TechnipFMC plc price-consensus-eps-surprise-chart | TechnipFMC plc Quote
Segmental Analysis
Subsea: Revenues in this segment were $1.4 billion, up 7.8% from the year-ago quarter’s recorded figure of $1.3 billion. This was primarily due to an increase in project activities in Brazil and the Gulf of Mexico.
Adjusted EBITDA was $142 million, up about 10% from the year-ago quarter’s level. Inbound orders increased 34% to $2.54 billion. Backlog rose 21.3%.
Surface Technologies: This segment recorded revenues of $329.8 million, up 23.6% year over year. This was primarily due to growth in North America, which benefited from the continued increase in drilling and completion activities. The unit’s adjusted EBITDA increased 83.1% to $40.3 million. The segment’s inbound orders rose 10.6%. The quarter-end backlog increased 5.1%.
Financials
During the reported quarter, TechnipFMC spent $57.3 million on capital programs. As of Mar 31, the company had cash and cash equivalents of $522.3 million and long-term debt of $1 billion, with a debt-to-capitalization of 23.9%.
2023 Outlook
TechnipFMC retained its revenue expectations from the Subsea unit in the $5.9-$6.3 billion range. It also maintained its revenue guidance for the Surface Technologies unit between $1.3 billion and $1.45 billion. EBITDA margin is expected in the band of 12-14%.
The company reiterated its free cash flow generation guidance in the $225-$375 million range. It also maintained its annual capital expenditure projection of $250 million and net interest expenses view of $100-$110 million.
Zacks Rank and Key Picks
Currently, TechnipFMC carries a Zacks Rank #3 (Hold). Some better-ranked stocks for investors interested in the energy sector are Par Pacific (PARR - Free Report) and Marathon Petroleum (MPC - Free Report) , each sporting a Zacks Rank #1 (Strong Buy), and Ranger Energy Services (RNGR - Free Report) , holding a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Par Pacific: PARR is worth approximately $1.63 billion. Its shares have risen 82.1% in the past year.
The company manages and maintains interests in energy and infrastructure businesses. Its operating segment consists of refining, retail and logistics.
Marathon Petroleum: MPC is valued at around $58.02 billion. It delivered an average earnings surprise of 20.91% for the last four quarters and its current dividend yield is 2.30%.
The company currently has a forward P/E ratio of 6.36. In comparison, its industry has an average forward P/E of 9.10, which means MPC is trading at a discount to the group.
Ranger Energy Services: RNGR is valued at around $242.99 million. In the past year, its shares have gained 16.8%.
Ranger Energy Services currently has a forward P/E ratio of 5.30. In comparison, its industry has an average forward P/E of 11.60, which means RNGR is trading at a discount to the group.