Technipís Fourth Quarter & Full Year 2010 Results
17 February 2011On February 15, 2011, Technipís Board of Directors approved the audited full year 2010 consolidated accounts. Chairman and CEO Thierry Pilenko commented: ďIn 2010, Technip reinforced its focus on profitable and sustainable growth. Our revenues for 2010 were at the top end of our expectations at €6.1 billion. We delivered profitability ahead of our initial goals driven by strong execution. Technipís operating profit margin was above 10% for the second year running and we met our revised objectives, with an operating margin of 16.7% in Subsea and 6.2% in Onshore/Offshore combined.
Order intake accelerated in the second half of the year despite a challenging competitive environment. We grew our backlog by over €1 billion during the year. Our backlog at the end of the year stood at €9.2 billion, our highest since the end of 2007, while the backlog scheduled forexecution beyond the current year is the highest we have had since 2006. This enables us to grow whilst meeting our objectives for diversification and risk profile.
Looking ahead to 2011, we are positive about the outlook for our industry. Oil prices and input costs are at levels which make most projects worldwide economically viable, allowing our clients to focus on growing production. This is reflected in renewed activity in the North Sea and Canada, for example. The areas supporting our structural growth - deepwater developments, refining in emerging markets, and gas production, including FLNG - remain robust. Regions such as Brazil, the Middle East and Australia show no signs of slowing down. Our clients continue to look for the best solutions for fully optimizing their assets from well to wheel, which plays to Technipís technological strengths. Nonetheless, competition remains intense. Although we see no overall significant inflation of project costs, given inflation in some underlying raw materials this is more of a risk - for the industry and for our clients - than a year ago. New regulations and geopolitical factors - whether in the Gulf of Mexico or North Africa - also add a level of uncertainty to the outlook.
Technipís backlog is strong as we enter 2011. The improved visibility in the last three months allows us to revise our 2011 initial view upwards. We target a Subsea margin above 15% and an Onshore/Offshore margin between 6.0% and 6.5%.
We will continue to focus on our long-term growth. We have already identified four key initiatives: initial plans for a new fabrication facility in Brazil focusing on high-end products; a new built flexlay vessel dedicated to Asian markets; expansion of our steel tube umbilical capabilities and a strategic foothold in offshore wind. Our initial capital expenditure expectations are above €400 million and we see attractive opportunities to add to this. Our balance sheet remains strong, with a good net cash position and attractive long term financing secured.
Our 2010 performance and 2011 outlook enable us to recommend that shareholders approve a dividend increase - from €1.35 per share to €1.45 per share.
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