FMC Technologies Reports Third Quarter up 46 Percent
Highlights:
- Subsea inbound orders of $766 million up $490 million from the prior-year quarter and 81 percent year-to-date
- Energy Systems operating profit up 42 percent compared to prior-year quarter
- The Company increases guidance for earnings from continuing operations to a range of $2.16 to $2.21
- The Company announces its intent to spin-off its FoodTech and Airport Systems businesses in a tax-free distribution to shareholders
FMC Technologies, Inc. (NYSE:FTI) today reported third quarter 2007 revenue of $1.1 billion, up 22 percent over the third quarter of 2006 led by the strength of its subsea systems business. Diluted earnings per share from continuing operations were $0.60, up 46 percent from $0.41 per diluted share in the prior-year quarter.
Inbound orders in the quarter totaled $1.5 billion of which $766 million was in subsea systems. Backlog reached $3.7 billion, including a record $2.6 billion for subsea systems.
Operating profit in Energy Systems was strong year-over-year, up 43 percent in Energy Production Systems and up 41 percent in Energy Processing Systems.
"We continue to see positive returns from being positioned as the technology leader in our industry," said Peter D. Kinnear, President and Chief Executive Officer. "Our energy segments again showed robust growth improving year-over-year in orders, backlog, sales, and operating profit, allowing us to raise our estimate for continuing operations for the full year to $2.16 - $2.21 per fully diluted share." Mr. Kinnear added, "We are also announcing our intent to spin-off our FoodTech and Airport Systems businesses to shareholders in a tax-free distribution. With the growth in the energy businesses over the past few years, FoodTech and Airport Systems have become a smaller part of the total company. We now feel that they would perform better as an independent public company focused on their respective markets."
Energy Production Systems
Energy Production Systems' third quarter revenue of $683.8 million increased 21 percent over the prior-year quarter, due mainly to increased subsea systems sales. Revenue for subsea systems was $521 million in the quarter, up 17 percent from the prior-year quarter. Surface wellhead revenue improved 31 percent from the prior-year quarter.
Energy Production Systems' operating profit of $70.4 million increased 43 percent over the prior-year quarter. The increase was due both to higher volume and operating margin in subsea systems. Surface wellhead operating profit improved due to higher volume.
Energy Production Systems' inbound orders were $943.0 million for the third quarter, up $533.0 million over the prior-year quarter due to the strength of orders for subsea systems. Subsea systems inbound orders were $766 million in the quarter, up 178 percent from the prior-year quarter and 81 percent year-to-date. Energy Production backlog of $2.9 billion was up 88 percent from the prior-year quarter and up 10 percent sequentially. Subsea backlog was a record $2.6 billion at the end of the third quarter.
Energy Processing Systems
Energy Processing Systems' third quarter revenue of $199.6 million was 14 percent higher than the prior-year quarter. The revenue improvement over the prior-year quarter was primarily the result of strong demand from service companies for fluid control products, including WECO®/Chiksan® equipment, which were up 25 percent from the prior-year quarter and 11 percent sequentially.
Energy Processing Systems' third quarter operating profit of $38.0 million was 41 percent higher than the prior-year quarter. The improvement was largely the result of higher volume and operating margins in both fluid control and measurement solutions.
Energy Processing Systems' inbound orders were $219.3 million for the third quarter, up 4 percent over the prior-year quarter and up 16 percent sequentially. Backlog is $357.2 million, up 31 percent from the prior-year quarter on strong fluid control, loading systems and measurement systems orders.
