Technip Profit Rises 19% as Explorers Start New Oil ProjectsTara Patel
Technip SA, Europe’s second-largest oilfield-services provider, said second-quarter profit rose 19 percent as energy companies pushed ahead with new projects even as crude prices stagnated.
Net income climbed to 162.4 million euros ($214 million) from 136 million euros a year earlier, the Paris-based company said today in a statement. Technip plans to complete about 4 billion euros of projects by the end of 2013, it said, maintaining full-year financial targets.
“We have not seen any meaningful change in our clients’ drive to sanction projects in the last few months,” Chief Executive Officer Thierry Pilenko said on a conference call. Costs also haven’t changed “significantly,” he said.
Technip supplies pipes, platforms and equipment to oil producers, helping them counter output declines at aging fields. Clients’ spending plans remain “robust” even as some projects in the Gulf of Mexico and Australia are delayed by rising costs and design changes, according to Technip. Oil averaged $94.17 a barrel in the quarter, 0.9 percent higher than a year earlier.
Technip rose 2.9 percent to 87.03 euros in Paris trading as of 9:20 a.m. local time.
The company’s contract backlog reached a record 15.2 billion euros at the end of the latest quarter with an intake of 2.8 billion euros during the period, today’s statement shows. It kept a target to increase sales as much as 16 percent to 9.5 billion euros this year.
Technip expects an operating margin in its subsea division of about 15 percent this year, compared with 15.9 percent in the latest quarter. The margin at its onshore-offshore unit will be 6 percent to 7 percent, compared with 6.7 percent in the quarter and 7 percent in 2012.
Most customers see growth of 5 percent to 15 percent in investment spending next year, Pilenko said on the call. “Over the next decade we may not see the same growth rate as we have seen in the past decade,” he said.
Technip, Europe’s largest oil-services provider after Saipem SpA, may make “very targeted, small acquisitions” to gain skills or specific technologies, Pilenko said.