Technip's Third Quarter 2013 Results Momentum in backlog maintained – full year objectives revised Business Wire PARIS -- October 31, 2013 Regulatory News: Technip (Paris:TEC)(ISIN:FR0000131708) (ADR:TKPPY): THIRD QUARTER 2013 RESULTS *Order intake of €3.1 billion *Backlog increased to €15.9 billion, of which €8.0 billion in Subsea *Revenue of €2.4 billion *Operating margin^1 of 9.2% *Net income of €150 million FULL YEAR 2013 OBJECTIVES REVISED *Group revenue to between €9.3 and €9.4 billion *Subsea revenue lowered to around €4.1 billion *Subsea operating margin lowered to around 14% *Onshore/Offshore revenue raised to around €5.2 billion *Onshore/Offshore operating margin raised to between 6.5% and 7% PREVIOUS OBJECTIVES *Group revenue growing 11% to 16% to between €9.1 and €9.5 billion *Subsea revenue growing to between €4.3 and €4.6 billion, with operating margin around 15% *Onshore/Offshore revenue growing to between €4.7 and €5.1 billion, with operating margin between 6% and 7% On October 29, 2013, Technip’s Board of Directors approved the third quarter 2013 consolidated accounts. € million (Except Diluted 3Q 12* 3Q 13 Change 9M 12* 9M 13 Change Earnings per Share) Revenue 2,085.9 2,411.9 15.6% 5,903.4 6,851.3 16.1% EBITDA^2 270.9 284.8 5.1% 732.9 806.1 10.0% EBITDA 13.0% 11.8% (118)bp 12.4% 11.8% (65)bp Margin Operating Income from 217.0 221.8 2.2% 589.5 637.3 8.1% Recurring Activities Operating 10.4% 9.2% (121)bp 10.0% 9.3% (68)bp Margin Operating 213.0 221.8 4.1% 582.5 637.3 9.4% Income Net Income 147.2 150.0 1.9% 395.4 428.6 8.4% Diluted Earnings per 1.22 1.24 1.6% 3.31 3.56 7.4% Share^3 (€) Order 2,848 3,142 8,674 8,812 Intake Backlog 13,518 15,851 * restated for retrospective application of amended IAS 19 standard “Employee Benefits” as of January 1, 2013 ^1 Operating income from recurring activities divided by revenue. ^2 Operating income from recurring activities before depreciation and amortization. ^3 As per IFRS, diluted earnings per share are calculated by dividing profit or loss attributable to the Parent Company’s Shareholders, restated from financial interest related to dilutive potential ordinary shares, by the weighted average number of outstanding shares during the period, plus the effect of dilutive potential ordinary shares related to the convertible bonds, dilutive stock options and performance shares calculated according to the “Share Purchase Method” (IFRS 2), less treasury shares. In conformity with this method, anti-dilutive stock options are ignored in calculating EPS. Dilutive options are taken into account if the subscription price of the stock options plus the future IFRS 2 charge (i.e. the sum of annual charge to be recorded until the end of the stock option plan) is lower than the average market share price during the period. Thierry Pilenko, Chairman and CEO, commented in detail on the quarter and the outlook: “In the third quarter, Technip's performance was contrasted between our two activities. On the one hand, Onshore/Offshore was a good performer: segment revenues were up 30% with margins of 6.6% in the middle of our target range. On the other hand, Subsea revenues were up only 2% (after c. €100 million of currency translation effects) although margins were at 14.7%, overall slightly ahead of our expectations at the end of the second quarter. Subsea profitability was affected by around €20 million of currency effects, €10 million of one-off costs (vessel depreciation) and a push-out of projects in the Gulf of Mexico. In particular, the Deep Energy vessel is in the Gulf of Mexico completing what has been, however, a significantly longer final commissioning period than planned. Group cash flow was strong during the quarter with e.g. €165 million of positive working capital, confirming the trend we forecasted at the end of the first semester. Overall, revenues and profit were held back across the Group by currency translation effects (year-on-year around €150 million and €30 million respectively). Order intake was strong at over €3 billion and included major project wins in the Middle East and Brazil. We continued to execute our strategy during the quarter with key alliances formed for example with China Huanqiu Contracting & Engineering Corporation (HQC) in Onshore procurement and with Sasol in gas-to-liquid (GTL). Progress on our strategic new assets continued – including construction of manufacturing facilities, Açuflex in Brazil and Newcaflex in England. For the rest of the year, the contrast in our activities is likely to continue. The fourth quarter in Subsea will see a busier schedule of installation operations in the US Gulf of Mexico than planned. As a result, there is an increased dependence in the region on managing schedule conflicts, on which we are actively working with our customers, as well as on the performance of the Deep Energy vessel on her first projects. Operations in other regions have been successful over the last quarter but the US Gulf of Mexico is important for segment profitability in the fourth quarter as there is a lower level of subsea installation activity in those other regions. We have revised our full year guidance as follows: for the Onshore/Offshore segment, we expect full year revenues and margins towards the top of our target range, revenues of around €5.2 billion, and operating margins between 6.5 and 7%. In Subsea, however, we expect full year revenues of around €4.1 billion. The fourth quarter revenues and currency impacts will hold back profitability and full year Subsea margins, previously targeted around 15%, are likely to be around 14%. Our revised guidance for both segments also assumes that foreign exchange movements will affect revenue and margin in a similar way as in the third quarter. Looking ahead to 2014, we have a strong, diversified book of business for execution across both segments to drive revenue growth. In Onshore/Offshore, we will look to start 2014 in line with our long-term target margins. In Subsea, we can confirm that there will be much less new asset start-up cost compared to 2013 and the positive contribution of subsea installation work on large, multi-year Subsea projects will materialize as the year progresses. By the end of the year, we will have gained much greater clarity on the schedule of new large, multi-year Subsea awards expected this year (including TEN in Ghana announced this morning); the timing and extent of the first orders for our new flexible pipe plant at Açu (which will determine the speed and extent of its ramp-up in 2014), our plan to accelerate vessel maintenance and enhancements in first half 2014, and the final close-out early next year of the current Gulf of Mexico projects. Accordingly, we intend to communicate further on 2014 by the end of December. The medium-term trends for both segments – Subsea and Onshore/Offshore – continue to be positive. Our broad, diversified client base continues to drive ahead with key projects. We see project award momentum over the coming months in for example downstream North America and Asia Pacific, large offshore projects in Africa, pre-salt flexible pipe awards in Brazil and frontier subsea areas like the West of Shetland in the North Sea. Accordingly, we will continue to drive our strategic development in line with the key pillars of our strategy. In the coming months we will remain most of all closely focused on our current projects so as to maintain our strong execution track record.” I. PORTFOLIO OF PROJECTS 1. Third Quarter 2013 Order Intake During third quarter 2013, Technip’s order intake was €3,142.2 million. The breakdown by business segment was as follows: Order Intake (€ million) 3Q 2012 3Q 2013 Subsea 1,224.3 1,756.7 Onshore/Offshore 1,623.7 1,385.5 Total 2,848.0 3,142.2 Subsea Third quarter Subsea order intake included four new Pipe-Lay Support Vessels (PLSVs) for Petrobras, two 300 ton top tension capacity to be built in Brazil and two other 650 ton to be built in Norway, all vessels in 50/50 partnership with DOF. In the US Gulf of Mexico, Technip will be in charge of the project management, engineering, fabrication and installation of the production system for the Stones gas pipeline in the Walker Ridge area, for which flowlines and risers will be welded at our spoolbase in Mobile, Alabama, and offshore installation will be performed by our Deep Blue pipelay vessel. A contract was also awarded for the development of the Delta House field for the fabrication and installation of flowlines and risers in deep waters, which will involve both the Deep Blue and the G1200 vessels. In Norway, Technip was awarded a contract by Statoil to fabricate and supply flexible pipes for riser replacement, using our latest high-technology product developments. Onshore/Offshore Onshore/Offshore order intake for the quarter included engineering, procurement, and construction (EPC) projects for the Umm Lulu and FMB platforms, respectively located in Abu Dhabi and Qatar, both of which will be installed using Technip’s float-over method. In the US, order intake included the early phases of a contract to design, supply and build two polyethylene plants for Chevron Phillips Chemical in Texas, strengthening Technip’s position in the US downstream market. This contract enters full EPC phase in the fourth quarter. A contract was also won to supply Technip’s proprietary ethylene technology and Front End Engineering Design (FEED) for an ethane cracker at Sasol’s Lake Charles site, in Louisiana. During the quarter, Technip signed several agreements and partnerships, including a frame agreement with Petrobras for offshore project services in Brazil, an alliance with Sasol for FEED services for future gas-to-liquid (GTL) projects, and two joint ventures with China Huanqiu Contracting & Engineering Corporation (HQC), reinforcing our position in the Chinese market. Listed in annex IV (b) are the main contracts announced since July 2013 and their approximate value if publicly disclosed. 2. Backlog by Geographic Area At the end of the third quarter 2013, Technip’s backlog rose to €15.9 billion, compared with €15.2 billion at the end of second quarter 2013, and €13.5 billion at the end of third quarter 2012. The movements in the backlog were affected by currency fluctuations against the euro this quarter. This backlog remains diversified in terms of project types, sizes, technologies and geographical areas as set-out in the table below: Backlog (€ million) June 30, Sept. 30, Change 2013 2013 Europe, Russia, Central Asia 4,168 3,704 (11.1)% Africa 2,549 2,466 (3.3)% Middle East 1,204 1,777 47.5% Asia Pacific 2,963 2,785 (6.0)% Americas 4,301 5,119 19.0% Total 15,185 15,851 4.4% 3. Backlog Scheduling Approximately 15% of the backlog is estimated to be scheduled for execution in 2013. Backlog Estimated Scheduling Subsea Onshore/Offshore Group as of September 30, 2013 (€ million) 2013 (3 months) 1,014 1,385 2,399 2014 2,978 3,766 6,744 2015 and beyond 3,990 2,718 6,708 Total 7,982 7,869 15,851 II. THIRD QUARTER 2013 OPERATIONAL & FINANCIAL HIGHLIGHTS In the third quarter 2013, foreign exchange had a negative impact year-on-year estimated at around €150 million on revenue and a negative impact estimated at around €30 million on operating income from recurring activities. The euro appreciated strongly against all our main operating currencies compared to a year ago, notably areas such as the North Sea and Brazil where we have substantial subsea activity. Profitability was also impacted by accelerated depreciation and additional charges for employee incentive plans. 1. Subsea Subsea main operations for the quarter were as follows: *In the North Sea, our pipelay vessel Apache II performed works on the Gannet and Juliet projects in Scotland. In Norway, our new construction vessel the Deep Orient performed works on the Goliat and Åsgard projects, installed the smoothbore riser for the Norne field, and is now in transit to Asia. Ramp-up and engineering started for the design of large diameter steel flowlines for Snøhvit CO, while activities continued for the Quad 204, Greater Stella and Bøyla projects. *In the Americas: *In Brazil, installation began for the first batch of Integrated Production Bundle risers and flowlines for the Papa-Terra field. Engineers started the detailed design of flexible pipes to be installed on the pre-salt field of Iracema Sul. *In the US Gulf of Mexico, many projects entered offshore phases in the quarter. The Deep Blue pipe-lay vessel completed works on the Walker Ridge gas gathering system and is currently installing flowlines and risers on the Jack and Saint Malo fields. The G1200 finished the first pipeline installation on Williams Tubular Bells. In Canada, the first pipelines were installed for the recently awarded South White Rose Extension project. *In West Africa, the design of steel tube umbilicals and flexible pipes for the Egina field in Nigeria progressed. Engineering activities continued for the design of the flexible and rigid pipes for the Moho Nord project in Congo, whilst the CoGa project was completed. *In Asia Pacific, umbilicals were designed for the Wheatstone project in Australia. In Malaysia, engineering activities continued for the Prelude FLNG subsea scope as well as for the Malikai field gas pipelines. Meanwhile, offshore operations started for the Panyu project in China and the installation of steel tube umbilicals was initiated for Gumusut. *Overall Group vessel utilization rate for the third quarter 2013 was 75% compared with 77% for the third quarter 2012. Subsea financial performance is set out in the following table. It was in particular impacted by low growth in revenues in the quarter, the strong appreciation of the Euro against all our main operating currencies, an one-off depreciation charge against a vessel, as well as the push-out of projects in the Gulf of Mexico. € million 3Q 2012* 3Q 2013 Change Subsea Revenue 1,074.9 1,094.4 1.8% EBITDA 210.4 213.5 1.5% EBITDA Margin 19.6% 19.5% (7)bp Operating Income From Recurring 163.3 160.8 (1.5)% Activities Operating Margin 15.2% 14.7% (50)bp * restated for retrospective application of amended IAS 19 standard “Employee Benefits” as of January 1, 2013 Concerning assets, the construction of the two 550 ton pipelay vessels continued well in Korea. Construction progressed as well on our new high-technology flexible pipe manufacturing plant in Açu, Brazil. The main building was nearly completed with the first delivery of machines and reels, and operators pursued their training at our Vitoria plant, before transfer to Açu. Our new pipelay vessel, the Deep Energy, transited to Mobile, Alabama, to complete a commissioning period that is longer than planned. Meanwhile, in England, the Newcaflex plant upgrade neared completion. During the quarter, we paid €15 million in initial payments for the four new PLSVs and will pay additional amounts in the fourth quarter. Capex for the year will exceed €570 million accordingly. 2. Onshore/Offshore Onshore/Offshore main operations for the quarter were as follows: *In the Middle East, the Jubail packages 2A and 5A were nearing completion, while procurement activities progressed for the Halobutyl project in Saudi Arabia. Engineering and procurement works ramped up for the BAPCO Sulfur Recovery Unit modification project in Bahrain, as well as for the Upper Zakum 750 EPC1 project in Abu Dhabi. The design phase started for the flares modification project awarded by Adma-Opco and for the Umm Lulu gas treatment field. *In Asia Pacific, in Malaysia, the construction of the hull and topsides for the Malikai Tension Leg Platform (TLP) was ongoing, as well as for the Petronas FLNG 1. In Australia, the design and procurement phases progressed for Ichthys’ Floating Production Storage and Offloading unit (FPSO), the Wheatstone’s gas processing platform neared completion, whilst the assembly of modules progressed in Korea for Shell’s Prelude FLNG. *In the Americas, in Canada, detailed engineering and design ramped up for a polyethylene expansion project. Procurement activities for the Westlake ethylene plant continued in Kentucky, whilst FEED activities started for the BG Trunkline LNG and neared completion for the Mosaic fertilizer, both in Louisiana. Other FEEDs progressed, notably Pacific NorthWest LNG in Canada, and Petrocarabobo and Petrourica in Venezuela. Meanwhile, in Mexico, on-site activities progressed for the Etileno XXI plant, and the main equipment was delivered. In Brazil, the design phase ramped up for the topsides of the P-76 FPSO. *Elsewhere, in Russia, detailed engineering started on the major Yamal LNG project. In Norway, engineering and procurement phases continued for the Aasta Hansteen Spar, whilst the first purchase orders were placed for the Martin Linge platform. In Finland, construction moved forward for the Heidelberg Spar at Technip’s yard in Pori. In Bulgaria, the procurement phase for the Burgas refinery was completed and its construction continued. Onshore/Offshore financial performance is set out in the following table: € million 3Q 2012* 3Q 2013 Change Onshore/Offshore Revenue 1,011.0 1,317.5 30.3% Operating Income From Recurring 72.4 86.9 20.0% Activities Operating Margin 7.2% 6.6% (57)bp * restated for retrospective application of amended IAS 19 standard “Employee Benefits” as of January 1, 2013 3. Group Technip Group’s Operating Income From Recurring Activities including Corporate charges as detailed in annex I (c) is set out in the following table: € million 3Q 2012* 3Q 2013 Change Group Revenue 2,085.9 2,411.9 15.6% Operating Income From Recurring 217.0 221.8 2.2% Activities Operating Margin 10.4% 9.2% (1.2)% * restated for retrospective application of amended IAS 19 standard “Employee Benefits” as of January 1, 2013 Financial result on contracts recognized as revenue amounted to €1.8 million in third quarter 2013. 4. Group Net Income Operating income was €222 million in the third quarter 2013, versus €213 million a year ago. Financial result in third quarter 2013 included a €12.1 million negative impact from changes in foreign exchange rates and fair market value of hedging instruments, compared with a €9.5million positive impact last year. The variation in Diluted Number of Shares is mainly due to stock options granted to Technip’s employees. € million, except Diluted Earnings per 3Q 2012* 3Q 2013 Change Share, and Diluted Number of Shares Operating Income 213.0 221.8 4.1% Financial Result (5.0) (29.4) 5x Share of Income / (Loss) of Equity - 0.7 nm Affiliates Income Tax Expense (59.2) (41.6) (29.7)% Effective Tax Rate 28.5% 21.5% (7.0)% Non-Controlling (1.6) (1.5) (6.3)% Interests Net Income 147.2 150.0 1.9% Diluted Number of 125,063,329 125,466,978 0.3% Shares Diluted Earnings per 1.22 1.24 1.6% Share (€) * restated for retrospective application of amended IAS 19 standard “Employee Benefits” as of January 1, 2013 5. Cash Flow and Statement of Financial Position As of September 30, 2013, the Group’s net debt was €55 million compared to €271 million at the end of June 2013. Net Cash Position as of June 30, 2013 (271.2) Net Cash Generated from / (Used in) Operating Activities 404.1 of which: Cash Generated from / (Used in) Operations 238.9 Change in Working Capital Requirements 165.2 Capital Expenditures (175.0) Dividends Paid - Other including FX Impacts (12.9) Net Cash Position as of September 30, 2013 (55.0) Capital expenditures for the third quarter 2013 increased to €175 million compared to €110 million one year ago. Year-to-date, they amounted to €457 million versus €358 million one year ago. Capex for the year will exceed €570 million accordingly. Shareholders’ equity as of September 30, 2013, was €4,084 million compared with €3,962 million as of December 31, 2012, restated. In October 2013, Technip issued three private placements with long maturities for general corporate purposes (€125 million and €130 million over 10 years, €100 million over 20 years) for an aggregate amount of €355 million. III. FULL YEAR 2013 OBJECTIVES REVISED *Group revenue to between €9.3 and €9.4 billion *Subsea revenue lowered to around €4.1 billion *Subsea operating margin lowered to around 14% *Onshore/Offshore revenue raised to around €5.2 billion *Onshore/Offshore operating margin raised to between 6.5% and 7% ° ° ° The information package on Third Quarter 2013 results includes this press release and the annexes which follow, as well as the presentation published on Technip’s website: www.technip.com NOTICE Today, Thursday, October 31, 2013, Chairman and CEO Thierry Pilenko, along with CFO Julian Waldron, will comment on Technip’s results and answer questions from the financial community during a conference call in English starting at 10:00a.m. CET. To participate in the conference call, you may call any of the following telephone numbers approximately 5 - 10 minutes prior to the scheduled start time: France / Continental Europe: +33 (0)1 70 77 09 42 UK: +44 (0)203 367 9461 USA: +1 866 907 5924 The conference call will also be available via a simultaneous, listen-only audio-cast on Technip’s website. A replay of this conference call will be available approximately two hours following the conference call for 90 days on Technip’s website and for two weeks at the following telephone numbers: Telephone Confirmation Numbers Code France / Continental +33 (0)1 72 283440# Europe: 00 15 00 UK: +44 (0)203 283440# 367 9460 USA: +1 877 642 283440# 3018 Cautionary note regarding forward-looking statements This presentation contains both historical and forward-looking statements. These forward-looking statements are not based on historical facts, but rather reflect our current expectations concerning future results and events, and generally may be identified by the use of forward-looking words such as “believe”, “aim”, “expect”, “anticipate”, “intend”, “foresee”, “likely”, “should”, “planned”, “may”, “estimates”, “potential” or other similar words. Similarly, statements that describe our objectives, plans or goals are or may be forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to differ materially from the anticipated results, performance or achievements expressed or implied by these forward-looking statements. Risks that could cause actual results to differ materially from the results anticipated in the forward-looking statements include, among other things: our ability to successfully continue to originate and execute large services contracts, and construction and project risks generally; the level of production-related capital expenditure in the oil and gas industry as well as other industries; currency fluctuations; interest rate fluctuations; raw material (especially steel) as well as maritime freight price fluctuations; the timing of development of energy resources; armed conflict or political instability in the Arabian-Persian Gulf, Africa or other regions; the strength of competition; control of costs and expenses; the reduced availability of government-sponsored export financing; losses in one or more of our large contracts; U.S. legislation relating to investments in Iran or elsewhere where we seek to do business; changes in tax legislation, rules, regulation or enforcement; intensified price pressure by our competitors; severe weather conditions; our ability to successfully keep pace with technology changes; our ability to attract and retain qualified personnel; the evolution, interpretation and uniform application and enforcement of International Financial Reporting Standards (IFRS), according to which we prepare our financial statements as of January 1, 2005; political and social stability in developing countries; competition; supply chain bottlenecks; the ability of our subcontractors to attract skilled labor; the fact that our operations may cause the discharge of hazardous substances, leading to significant environmental remediation costs; our ability to manage and mitigate logistical challenges due to underdeveloped infrastructure in some countries where we are performing projects. Some of these risk factors are set forth and discussed in more detail in our Annual Report. Should one of these known or unknown risks materialize, or should our underlying assumptions prove incorrect, our future results could be adversely affected, causing these results to differ materially from those expressed in our forward-looking statements. These factors are not necessarily all of the important factors that could cause our actual results to differ materially from those expressed in any of our forward-looking statements. Other unknown or unpredictable factors also could have material adverse effects on our future results. The forward-looking statements included in this release are made only as of the date of this release. We cannot assure you that projected results or events will be achieved. We do not intend, and do not assume any obligation to update any industry information or forward-looking information set forth in this release to reflect subsequent events or circumstances. **** This presentation does not constitute an offer or invitation to purchase any securities of Technip in the United States or any other jurisdiction. Securities may not be offered or sold in the United States absent registration or an exemption from registration. The information contained in this presentation may not be relied upon in deciding whether or not to acquire Technip securities. This presentation is being furnished to you solely for your information, and it may not be reproduced, redistributed or published, directly or indirectly, in whole or in part, to any other person. Non-compliance with these restrictions may result in the violation of legal restrictions of the United States or of other jurisdictions. **** ° ° ° Technip is a world leader in project management, engineering and construction for the energy industry. From the deepest Subsea oil & gas developments to the largest and most complex Offshore and Onshore infrastructures, our 38,000 people are constantly offering the best solutions and most innovative technologies to meet the world’s energy challenges. Present in 48 countries, Technip has state-of-the-art industrial assets on all continents and operates a fleet of specialized vessels for pipeline installation and subsea construction. Technip shares are listed on the NYSE Euronext Paris exchange and ADR is traded in the US on the OTCQX marketplace as an American Depositary Receipt (OTCQX: TKPPY). ANNEX I (a) CONSOLIDATED STATEMENT OF INCOME IFRS, not audited € million Third Quarter 9 Months (Except Diluted Earnings per Share, and 2012* 2013 Change 2012* 2013 Change Diluted Number of Shares) Revenue 2,085.9 2,411.9 15.6% 5,903.4 6,851.3 16.1% Gross Margin 395.4 412.8 4.4% 1,108.4 1,208.5 9.0% Research & Development (17.6) (20.4) 15.9% (50.2) (51.1) 1.8% Expenses SG&A and Other (160.8) (170.6) 6.1% (468.7) (520.1) 11.0% Operating Income from 217.0 221.8 2.2% 589.5 637.3 8.1% Recurring Activities Non-Current Operating (4.0) - nm (7.0) - nm Result Operating 213.0 221.8 4.1% 582.5 637.3 9.4% Income Financial (5.0) (29.4) 5x (31.1) (48.4) 55.6% Result Share of Income / - 0.7 nm - 0.8 nm (Loss) of Equity Affiliates Income / (Loss) 208.0 193.1 (7.2)% 551.4 589.7 6.9% before Tax Income Tax (59.2) (41.6) (29.7)% (153.0) (157.9) 3.2% Expense Non-Controlling (1.6) (1.5) (6.3)% (3.0) (3.2) 6.7% Interests Net Income / 147.2 150.0 1.9% 395.4 428.6 8.4% (Loss) Diluted Number 125,063,329 125,466,978 0.3% 123,857,522 124,720,328 0.7% of Shares Diluted Earnings per 1.22 1.24 1.6% 3.31 3.56 7.4% Share (€) * restated for retrospective application of amended IAS 19 standard “Employee Benefits” as of January 1, 2013 ANNEX I (b) FOREIGN CURRENCY CONVERSION RATES IFRS, not audited Closing Rate as of Average Rate of Dec. 31, Sept. 30, 2012 2013 3Q 2012 3Q 2013 9M 2012 9M 2013 USD for 1 EUR 1.32 1.35 1.25 1.32 1.28 1.32 GBP for 1 EUR 0.82 0.84 0.79 0.85 0.81 0.85 BRL for 1 EUR 2.70 3.04 2.54 3.03 2.46 2.79 NOK for 1 EUR 7.35 8.11 7.39 7.93 7.51 7.66 ANNEX I (c) ADDITIONAL INFORMATION BY BUSINESS SEGMENT IFRS, not audited Third Quarter 9 Months € million 2012* 2013 Change 2012* 2013 Change SUBSEA Revenue 1,074.9 1,094.4 1.8% 2,847.2 3,119.9 9.6% Gross Margin 235.0 233.7 (0.6)% 642.6 691.3 7.6% Operating Income from Recurring 163.3 160.8 (1.5)% 426.8 454.6 6.5% Activities Operating Margin 15.2% 14.7% (50)bp 15.0% 14.6% (42)bp Depreciation and (47.1) (52.7) 11.9% (123.0) (141.7) 15.2% Amortization EBITDA 210.4 213.5 1.5% 549.8 596.3 8.5% EBITDA Margin 19.6% 19.5% (7)bp 19.3% 19.1% (20)bp ONSHORE/OFFSHORE Revenue 1,011.0 1,317.5 30.3% 3,056.2 3,731.4 22.1% Gross Margin 160.4 179.1 11.7% 465.8 517.2 11.0% Operating Income from Recurring 72.4 86.9 20.0% 214.0 249.9 16.8% Activities Operating Margin 7.2% 6.6% (57)bp 7.0% 6.7% (30)bp Depreciation and (6.8) (10.3) 51.5% (20.4) (27.1) 32.8% Amortization CORPORATE Operating Income from Recurring (18.7) (25.9) 38.5% (51.3) (67.2) 31.0% Activities Depreciation and - - nm - - nm Amortization ANNEX I (d) REVENUE BY GEOGRAPHICAL AREA IFRS, not audited Third Quarter 9 Months € 2012* 2013 Change 2012* 2013 Change million Europe, Russia, 662.9 841.4 26.9% 1,784.4 2,031.1 13.8% Central Asia Africa 189.7 188.0 (0.9)% 506.7 517.8 2.2% Middle 254.0 191.2 (24.7)% 794.8 715.8 (9.9)% East Asia 329.1 465.2 41.4% 937.3 1,374.6 46.7% Pacific Americas 650.2 726.1 11.7% 1,880.2 2,212.0 17.6% TOTAL 2,085.9 2,411.9 15.6% 5,903.4 6,851.3 16.1% * restated for retrospective application of amended IAS 19 standard “Employee Benefits” as of January 1, 2013 ANNEX II CONSOLIDATED STATEMENT OF FINANCIAL POSITION IFRS Dec. 31, 2012* Sept. 30, 2013 € million (not audited) (not audited) Fixed Assets 6,033.4 6,175.0 Deferred Tax Assets 332.1 306.6 Non-Current Assets 6,365.5 6,481.6 Construction Contracts – 454.3 735.4 Amounts in Assets Inventories, Trade Receivables 2,504.8 2,779.1 and Other Cash & Cash Equivalents 2,289.3 2,174.9 Current Assets 5,248.4 5,689.4 Assets Classified as Held for 9.9 - Sale Total Assets 11,623.8 12,171.0 Shareholders’ Equity (Parent 3,948.9 4,070.4 Company) Non-Controlling Interests 13.2 13.5 Shareholders’ Equity 3,962.1 4,083.9 Non-Current Financial Debts 1,705.7 2,031.1 Non-Current Provisions 229.0 248.4 Deferred Tax Liabilities and 285.8 303.7 Other Non-Current Liabilities Non-Current Liabilities 2,220.5 2,583.2 Current Financial Debts 400.4 198.8 Current Provisions 361.0 256.5 Construction Contracts – 873.0 1,132.0 Amounts in Liabilities Trade Payables & Other 3,806.8 3,916.6 Current Liabilities 5,441.2 5,503.9 Total Shareholders’ Equity & 11,623.8 12,171.0 Liabilities Net Cash Position 183.2 (55.0) Statement of Changes in Shareholders’ Equity (Parent Company) not audited (€ million): Shareholders’ Equity as of 3,948.9 December 31, 2012* 9 Months 2013 Net 428.6 Income 9 Months 2013 Other Comprehensive (153.0) Income Capital Increase 24.7 Treasury Shares (30.9) Dividends Paid (186.0) Other 38.1 Shareholders’ Equity as of 4,070.4 September 30, 2013 * restated for retrospective application of amended IAS 19 standard “Employee Benefits” as of January 1, 2013 and restated with assessment of purchase price allocation of Stone and Webster Process technologies ANNEX III (a) CONSOLIDATED STATEMENT OF CASH FLOWS IFRS, not audited 9 Months € million 2012* 2013 Net Income / (Loss) of the 395.4 428.6 Parent Company Depreciation & Amortization of 143.4 168.8 Fixed Assets Stock Options and Performance 30.0 35.9 Share Charges Non-Current Provisions (including 13.5 22.6 Employee Benefits) Deferred Income 57.4 35.1 Tax Net (Gains) / Losses on Disposal of (5.7) (5.5) Assets and Investments Non-Controlling Interests and 23.5 26.2 Other Cash Generated from / (Used in) 657.5 711.7 Operations Change in Working Capital (442.1) (265.0) Requirements Net Cash Generated from / (Used in) 215.4 446.7 Operating Activities Capital (357.6) (456.5) Expenditures Proceeds from Non-Current 41.5 12.7 Asset Disposals Acquisitions of (3.3) - Financial Assets Acquisition Costs of Consolidated (240.1) (8.2) Companies, Net of Cash acquired Net Cash Generated from / (Used in) (559.5) (452.0) Investing Activities Net Increase / (Decrease) in (54.1) 173.2 Borrowings Capital Increase 114.0 24.7 Dividends Paid (172.6) (186.0) Share Buy-Back (82.6) (40.0) Net Cash Generated from / (Used in) (195.3) (28.1) Financing Activities Net Effects of Foreign Exchange 16.5 (81.4) Rate Changes Net Increase / (Decrease) in (522.9) (114.8) Cash and Cash Equivalents Bank Overdrafts at Period (0.1) (0.3) Beginning Cash and Cash Equivalents at 2,808.7 2,289.3 Period Beginning Bank Overdrafts (1.6) (0.7) at Period End Cash and Cash Equivalents at 2,287.3 2,174.9 Period End (522.9) (114.8) * restated for retrospective application of amended IAS 19 standard “Employee Benefits” as of January 1, 2013 ANNEX III (b) CASH & FINANCIAL DEBTS IFRS not audited Cash and Financial Debts Dec. 31, 2012* Sept. 30, 2013 € million (not audited) (not audited) Cash Equivalents 965.7 929.9 Cash 1,323.6 1,245.0 Cash & Cash Equivalents (A) 2,289.3 2,174.9 Current Financial Debts 400.4 198.8 Non-Current Financial Debts 1,705.7 2,031.1 Gross Debt (B) 2,106.1 2,229.9 Net Cash Position (A – B) 183.2 (55.0) * restated for retrospective application of amended IAS 19 standard “Employee Benefits” as of January 1, 2013 ANNEX IV (a) BACKLOG not audited Backlog by Business Segment As of As of Change € million Sept. 30, 2012 Sept. 30, 2013 Subsea 6,119.6 7,981.3 30.4% Onshore/Offshore 7,398.8 7,869.2 6.4% Total 13,518.4 15,850.5 17.3% ANNEX IV (b) CONTRACT AWARDS not audited The main contracts we announced during third quarter 2013 were the following: Subsea Segment: *Important contract for project management, engineering and manufacture of 76 kilometers of steel tube umbilicals for the Egina field at water depths ranging from 1,150 to 1,750 meters: Total Upstream Nigeria Ltd, offshore Nigeria, *Two flexible pipe supply contracts for the Egina field for which Technip’s Flexi France manufacturing plant in Le Trait will fabricate the flexible pipes: Total Upstream Nigeria Ltd, offshore Nigeria, *A substantial contract for engineering, procurement, installation and construction (EPIC) Ltd for the Alder field for a tieback to the Britannia Bridge Link Platform (BLP), at a water depth of approximately 150 meters: Chevron North Sea Ltd, central North Sea, Scotland, *Eight contracts covering the construction and operations of four new Pipe-Lay Support Vessels (PLSVs) to install flexible pipes, in joint venture with DOF: Petrobras, Brazilian waters, Brazil, *Important engineering, procurement and installation (EPCI) contract for the development of subsea infrastructure for the Stones field located at a water depth of approximately 2,900 meters: Shell, Walker Ridge area, Gulf of Mexico, USA, *Important five-year contract for the supply of highly-resistant steel wires by ArcelorMittal in its Bourg-en-Bresse site, for the development of Technip’s oil and gas offshore fields, with the aim of strengthening its wire activities in the long term: ArcelorMittal, Bourg-en-Bresse, France, *Supply contract to fabricate and deliver flexible risers for the renewal of the flexible pipe based infrastructure on several operated fields: Statoil, Norwegian Continental Shelf, Norway. Onshore/Offshore Segment: *Significant contract to supply proprietary technology, engineering and procurement services for two hydrogen reformers, part of the Deep Conversion project being executed by the consortium for Petroleos de Venezuela SA (PDVSA) to upgrade the Puerto La Cruz refinery: Hyundai-Wison consortium, Venezuela, *An important engineering, procurement, and supply contract for the Moho Phase 1bis development consisting of tie-backs to the existing deepwater Alima Floating Production Unit (FPU) and the shallow-water N’Kossa platform: Total E&P Congo, offshore Pointe Noire, in the Republic of Congo, *A contract for the conceptual engineering study, the basic engineering design (BED), as well as for the procurement of key equipment, for a mid-scale liquefied natural gas (LNG) plant: Shaanxi LNG Investment & Development Co Ltd, Yangling Demonstration Area, Shaanxi Province, China, *Supply contract for Technip’s proprietary reforming technology as well as EPCI of the No. 2 hydrogen plant equipment at NCRA’s refinery, in consortium with its construction partner Performance Contractors Inc.: National Cooperative Refinery Association (NCRA), McPherson, Kansas, USA, *Technip and Sasol established an alliance for front-end engineering services for future GTL projects. This also allows Technip’s to participate in the execution stages of future GTL projects, *A front-end engineering and design (FEED) contract awarded by Trunkline LNG Export, LLC for the potential expansion of the existing liquefied natural gas (LNG) import terminal: Trunkline LNG Export, Lake Charles, Louisiana, USA, *Major contract for the detailed engineering, procurement, fabrication, offshore installation, commissioning and start-up of six bridge-linked platforms, in a consortium led by National Petroleum Construction Company (NPCC): Abu Dhabi Marine Operating Company (ADMA-OPCO), Umm Lulu Full Field, United Arab Emirates, *Four-year frame agreement with Petrobras for project modifications services for the Rio de Janeiro Operations Unit (UO-RIO), including existing offshore platforms: Petrobras, Campos Basin area, Brazil, *Technip and China Huanqiu Contracting & Engineering Corporation (HQC) created two joint ventures to improve access to the European and Chinese procurement markets, based in Rome, Italy and Beijing, China, *Technip and Shell Cansolv signed an agreement to offer a full chain of engineering, procurement and construction (EPC) services for a post-combustion CO Capture and Sequestration (CCS) to the power generation industry. Since September 30, 2013, Technip has also announced the award of the following contracts, which were included in the backlog as of September 30, 2013: Onshore/Offshore Segment: *Substantial contract for the design, supply and installation of two polyethylene plants with capacity of 500,000 metric tons per annum, in a partnership with Zachry Industrial called Gulf Coast Partners: Chevron Phillips Chemical Company LP (Chevron Phillips Chemical), Old Ocean, Texas, USA, *Contract to supply proprietary ethylene technology and FEED for a world-class grassroots ethane cracker which will produce an estimated 1.5 million tons per annum of ethylene: Sasol, Lake Charles, Louisiana, USA, Contract awarded for the engineering, procurement, installation and commissioning for the important FMB offshore project comprising a living quarter platform and a utility platform connected by a bridge: Qatar Petroleum, offshore Qatar. Since September 30, 2013, Technip has also announced the award of the following contracts, which were not included in the backlog as of September 30, 2013: Subsea Segment: *Contract for the development of the Delta House field; covering more than 200 kilometers of infield, export flowlines and risers at water depths of approximately 100 to 2,000 meters: LLOG Exploration Offshore L.L.C, Mississippi Canyon area, Gulf of Mexico, USA, *Two contracts for the engineering, fabrication and installation of flexible pipes, rigid flowlines and umbilicals for the TEN field, at water depths reaching 2,000 meters, in a consortium with Subsea 7: Tullow Ghana Limited, offshore Ghana. Onshore/Offshore Segment: *Major engineering, procurement, construction, installation and commissioning (EPCIC) contract for the development of two gas fields in Block SK316 at a water depth of 100 meters, in a joint venture with Malaysia Marine and Heavy Engineering Sdn Bhd (MMHE): Petronas Carigali, North of Bintulu, Sarawak, Malaysia. Contact: Technip Analyst and Investor Relations Kimberly Stewart, +33 (0)1 47 78 66 74 email@example.com or David Tadbir, +33 (0)1 40 90 19 04 firstname.lastname@example.org or Public Relations Christophe Bélorgeot, +33 (0)1 47 78 39 92 email@example.com or Technip’s website http://www.technip.com Technip’s IR website http://investors-en.technip.com Technip’s IR mobile website http://investors.mobi-en.technip.com
Technip's Third Quarter 2013 Results
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