FMC Technologies Reports Fourth Quarter 2009 Diluted Earnings Per Share of $0.75
Highlights:
-- Record subsea systems revenue of $822 million
-- Energy Production Systems operating profit up 10 percent
-- Full year 2009 company operating profit a record $619 million
-- Company provides 2010 guidance for diluted earnings per share of $2.45 to $2.65
HOUSTON, Feb. 16 /PRNewswire-FirstCall/ -- FMC Technologies, Inc. (NYSE: FTI) today reported fourth quarter 2009 revenue from continuing operations of $1.2 billion, including a record $822 million in subsea systems. Diluted earnings per share from continuing operations were $0.75 compared to $0.74 in the prior-year quarter.
(Logo: http://www.newscom.com/cgi-bin/prnh/20081222/LAM028LOGO)
Led by higher operating margin and volume in subsea systems, fourth quarter operating profit in Energy Production Systems increased 10 percent from the fourth quarter of 2008. Operating profit in Energy Processing Systems was down 49 percent from the prior-year quarter due mainly to continued market weakness in the fluid control business.
Full Year 2009 Results
The 2009 total company revenue of $4.4 billion was led by subsea systems, whose revenue increased three percent to a record $3.1 billion. Total company operating profit increased six percent to a record $618.5 million. The full year 2009 diluted earnings per share from continuing operations of $2.87 were up six percent from the 2008 diluted earnings per share of $2.72.
"As a result of a healthy backlog and strong execution, we are pleased to report another year of earnings growth," said Peter D. Kinnear, Chairman, President and Chief Executive Officer. "While we anticipate 2010 revenue to be slightly lower than 2009, we expect a significant rebound in orders and a rebuilding of our backlog. Our estimate for 2010 diluted earnings per share is $2.45 to $2.65."
Review of Operations – Fourth Quarter 2009
Energy Production Systems
Energy Production Systems' record fourth quarter revenue of $988.8 million increased $16.0 million from the prior-year quarter. Revenue for subsea systems was a record $822 million, up four percent from the prior-year quarter. Surface wellhead revenue was down six percent from the fourth quarter of 2008 but was up five percent compared to the third quarter of 2009.
Energy Production Systems' operating profit of $131.2 million increased 10 percent over the prior-year quarter. The increase in operating profit was due to higher operating margins across the segment and increased volume in subsea systems.
Energy Production Systems' inbound orders for the fourth quarter were $584.5 million, including subsea systems orders of $411 million. Backlog for Energy Production Systems was $2.3 billion, including $2.0 billion in subsea systems at the end of the fourth quarter.
Energy Processing Systems
Energy Processing Systems' fourth quarter revenue of $177.1 million was 23 percent lower than the prior-year quarter but was up seven percent from the third quarter of 2009. The sequential revenue increase came primarily from the measurement solutions business.
Energy Processing Systems' fourth quarter operating profit of $20.6 million was down 49 percent from the prior-year quarter, primarily driven by lower volume and operating margin in the fluid control business resulting from weakness in the North American market.
Energy Processing Systems' inbound orders were $171.6 million for the fourth quarter, which was up 22 percent sequentially driven in part by the fluid control business and was at the highest level since the third quarter of 2008. Backlog for the segment finished the quarter at $221.1 million.
Corporate Items
Corporate expense in the fourth quarter was $10.2 million, an increase of $1.1 million from the prior-year quarter.
Other expense, net, was $5.4 million, a decrease of $16.4 million from the prior-year quarter. The decrease from the prior-year quarter included $7.0 million in lower LIFO charges, a reduction of $5.3 million in net foreign exchange losses, and a reduction of $4.7 million in pension expenses.
The company ended the quarter with net cash of $40.6 million. Net interest expense was $3.0 million in the quarter.
The company repurchased 376 thousand shares of common stock in the quarter for $21.5 million and now has 5.4 million shares remaining in its stock repurchase authorization.
Depreciation and amortization for the fourth quarter was $28.3 million, up $3.7 million from the previous quarter, and capital expenditures totaled $34.0 million.
The company recorded an effective tax rate of 30.3 percent for the fourth quarter.
Summary and Outlook
FMC Technologies reported diluted earnings per share from continuing operations of $0.75, which was an increase from $0.74 in the prior-year quarter. Fourth quarter revenue from continuing operations was $1.2 billion, including a record $822 million in subsea systems.
Energy Production Systems' operating profit was up 10 percent over the fourth quarter of 2008. Total company operating profit for the full year 2009 increased six percent to a record $618.5 million.
The company provided guidance for 2010 diluted earnings per share from continuing operations in a range of $2.45 to $2.65.
FMC Technologies, Inc. (NYSE: FTI) is a leading global provider of technology solutions for the energy industry. The Company has approximately 10,400 employees and operates 19 manufacturing facilities in 14 countries. FMC Technologies designs, manufactures and services technologically sophisticated systems and products such as subsea production and processing systems, surface wellhead systems, high pressure fluid control equipment, measurement solutions, and marine loading systems for the oil and gas industry. For more information, visit www.fmctechnologies.com.
This release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are information of a non-historical nature and are subject to risks and uncertainties that are beyond the Company's ability to control. These risks and uncertainties are described under the caption "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2008 and may be modified in subsequent quarterly reports filed by the Company with the Securities and Exchange Commission that may be accessed on the Company's website. The Company cautions shareholders and prospective investors that actual results may differ materially from those indicated by the forward-looking statements.
FMC Technologies, Inc. will conduct its fourth quarter 2009 conference call at 9:00 a.m. EST on Wednesday, February 17, 2010. The event will be available at www.fmctechnologies.com. An archived audio replay will also be available after the event at the same website address. In the event of a disruption of service or technical difficulty during the call, information will be posted at www.fmctechnologies.com/earnings.
FMC TECHNOLOGIES, INC. AND CONSOLIDATED SUBSIDIARIES
----------------------------------------------------
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
-------------------------------------------
(Unaudited and in millions, except per share amounts)
Three Months Ended Twelve Months Ended
December 31 December 31
----------- -----------
2009 2008 2009 2008
---- ---- ---- ----
Revenue $1,160.2 $1,205.1 $4,405.4 $4,550.9
Costs and expenses 1,023.8 1,064.7 3,875.3 4,020.1
------- ------- ------- -------
136.4 140.4 530.1 530.8
Other expense, net (0.3) (11.5) (2.7) (23.0)
---- ----- ---- -----
Income before net interest
expense and income taxes 136.1 128.9 527.4 507.8
Net interest expense (3.0) (0.7) (9.5) (1.5)
---- ---- ---- ----
Income from continuing
operations before income taxes 133.1 128.2 517.9 506.3
Provision for income taxes 40.3 34.3 155.1 152.0
---- ---- ----- -----
Income from continuing
operations 92.8 93.9 362.8 354.3
Income (loss) from discontinued
operations, net of income taxes 0.3 (2.6) 0.5 8.4
--- ---- --- ---
Net Income 93.1 91.3 363.3 362.7
Less: net income attributable
to noncontrolling interests 0.1 - (1.5) (1.4)
----- ----- ------ ------
Net income attributable to FMC
Technologies, Inc. $93.2 $91.3 $361.8 $361.3
===== ===== ====== ======
Basic Earnings per share
attributable to FMC
Technologies, Inc.:
Income from continuing
operations $0.75 $0.75 $2.91 $2.76
Income (loss) from
discontinued operations 0.01 (0.02) - 0.07
---- ----- --- ----
Basic earnings per share $0.76 $0.73 $2.91 $2.83
===== ===== ===== =====
Basic weighted average shares
outstanding 123.1 125.5 124.3 127.8
===== ===== ===== =====
Diluted earnings per share
attributable to
FMC Technologies, Inc.:
Income from continuing
operations $0.75 $0.74 $2.87 $2.72
Income (loss) from
discontinued operations - (0.02) 0.01 0.06
--- ----- ---- ----
Diluted earnings per share $0.75 $0.72 $2.88 $2.78
===== ===== ===== =====
Diluted weighted average shares
outstanding 124.6 127.5 125.7 129.7
===== ===== ===== =====
Net income attributable to
FMC Technologies, Inc.:
Income from continuing
operations $92.9 $93.9 $361.3 $352.9
Income (loss) from
discontinued operations 0.3 (2.6) 0.5 8.4
--- ---- --- ---
Net income attributable to FMC
Technologies, Inc. $93.2 $91.3 $361.8 $361.3
===== ===== ====== ======
FMC TECHNOLOGIES, INC. AND CONSOLIDATED SUBSIDIARIES
----------------------------------------------------
BUSINESS SEGMENT DATA
---------------------
(Unaudited and in millions)
Three Months Ended Twelve Months Ended
December 31 December 31
----------- -----------
2009 2008 2009 2008
---- ---- ---- ----
Revenue
-------
Energy Production Systems $988.8 $972.8 $3,721.9 $3,670.7
Energy Processing Systems 177.1 229.6 698.4 883.2
Other revenue (1) and
intercompany eliminations (5.7) 2.7 (14.9) (3.0)
---- --- ----- ----
$1,160.2 $1,205.1 $4,405.4 $4,550.9
======== ======== ======== ========
Income before income taxes
--------------------------
Segment operating profit
------------------------
Energy Production Systems $131.2 $119.1 $516.1 $420.7
Energy Processing Systems 20.6 40.7 102.4 165.5
---- ---- ----- -----
Total segment operating
profit 151.8 159.8 618.5 586.2
Corporate items
---------------
Corporate expense (10.2) (9.1) (35.4) (37.5)
Other revenue and other
expense, net (1) (5.4) (21.8) (57.2) (42.3)
Net interest expense (3.0) (0.7) (9.5) (1.5)
---- ---- ---- ----
Total corporate items (18.6) (31.6) (102.1) (81.3)
----- ----- ------ -----
Income from continuing
operations before income taxes
attributable to FMC
Technologies, Inc. $133.2 $128.2 $516.4 $504.9
====== ====== ====== ======
(1) Other revenue comprises certain unrealized gains and losses on
derivative instruments related to unexecuted sales contracts. Other
expense, net, generally includes stock-based compensation, other
employee benefits, LIFO adjustments, certain foreign exchange gains
and losses, and the impact of unusual or strategic transactions not
representative of segment operations.
FMC TECHNOLOGIES, INC. AND CONSOLIDATED SUBSIDIARIES
----------------------------------------------------
BUSINESS SEGMENT DATA
---------------------
(Unaudited and in millions)
Three Months Ended Twelve Months Ended
December 31 December 31
----------- -----------
2009 2008 2009 2008
---- ---- ---- ----
Inbound Orders
--------------
Energy Production Systems $584.5 $401.5 $2,709.4 $2,853.2
Energy Processing Systems 171.6 167.4 606.4 865.9
----- ----- ----- -----
Subtotal Energy Systems 756.1 568.9 3,315.8 3,719.1
Intercompany eliminations (9.9) (3.2) (16.9) (7.6)
---- ---- ----- ----
Total inbound orders $746.2 $565.7 $3,298.9 $3,711.5
====== ====== ======== ========
December 31
-----------
2009 2008
---- ----
Order Backlog
-------------
Energy Production Systems $2,332.6 $3,345.0
Energy Processing Systems 221.1 313.2
----- -----
Subtotal Energy Systems 2,553.7 3,658.2
Intercompany eliminations (8.3) (7.0)
---- ----
Total order backlog $2,545.4 $3,651.2
======== ========
FMC TECHNOLOGIES, INC. AND CONSOLIDATED SUBSIDIARIES
----------------------------------------------------
CONDENSED CONSOLIDATED BALANCE SHEETS
-------------------------------------
(In millions)
December 31, December 31,
2009 2008
(Unaudited)
-----------
Cash and cash equivalents $460.7 $340.1
Trade receivables, net 879.2 996.1
Inventories 591.8 559.3
Other current assets 293.9 542.8
----- -----
Total current assets 2,225.6 2,438.3
Property, plant and equipment, net 581.9 494.9
Goodwill 272.7 128.7
Intangible assets, net 154.6 70.2
Investments 141.8 151.2
Other assets 132.9 297.6
----- -----
Total assets $3,509.5 $3,580.9
======== ========
Short-term debt and current portion of
long-term debt $28.5 $23.0
Accounts payable, trade 343.9 439.8
Advance payments and progress billings 670.4 770.3
Other current liabilities 634.6 726.7
Liabilities of discontinued operations 1.1 3.5
--- ---
Total current liabilities 1,678.5 1,963.3
Long-term debt, less current portion 391.6 472.0
Other liabilities 327.6 446.9
Common stock 1.4 1.4
Other FMC Technologies, Inc.
stockholders' equity 1,101.4 689.0
Noncontrolling interest in consolidated
companies 9.0 8.3
--- ---
Total liabilities and equity $3,509.5 $3,580.9
======== ========
FMC TECHNOLOGIES, INC. AND CONSOLIDATED SUBSIDIARIES
----------------------------------------------------
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
-----------------------------------------------
(Unaudited and in millions)
Twelve Months
Ended
December 31
-----------
2009 2008
---- ----
Cash provided (required) by operating
activities of continuing operations:
Income from continuing operations $361.3 $352.9
Depreciation and amortization 93.0 72.6
Trade accounts receivable, net 211.3 (322.7)
Inventories 7.5 (77.1)
Accounts payable, trade (142.8) 140.9
Advance payments and progress billings (182.4) 207.6
Other 248.7 (112.5)
----- ------
Net cash provided by operating activities of
continuing operations 596.6 261.7
----- -----
Cash required by operating activities of discontinued
operations (2.1) (11.1)
---- -----
Cash provided (required) by investing
activities of continuing operations:
Capital expenditures (110.0) (165.0)
Proceeds from disposal of assets 18.9 3.4
Acquisitions, minority ownership
positions and other investing (162.6) (121.3)
------ ------
Net cash required by investing activities of
continuing operations (253.7) (282.9)
------ ------
Cash required by investing activities of discontinued
operations - (4.7)
--- ----
Cash provided (required) by financing activities:
Net (repayment) issuance of debt (80.2) 369.4
Issuance of capital stock 3.1 4.8
Purchase of stock held in treasury (155.7) (324.0)
Proceeds from spin-off of JBT Corporation - 196.2
Other financing (4.8) 6.3
---- ---
Net cash (required) provided by financing activities (237.6) 252.7
------ -----
Effect of changes in foreign exchange rates on cash
and cash equivalents 17.4 (5.1)
---- ----
Increase in cash and cash equivalents 120.6 210.6
Cash and cash equivalents, beginning of period 340.1 129.5
----- -----
Cash and cash equivalents, end of period $460.7 $340.1
====== ======
SOURCE FMC Technologies, Inc.
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