TechnipFMC PLC J.P. Morgan Natural Resources Conference and Dinner Takeaways

Research evidence excerpt

TechnipFMC PLC J.P. Morgan Natural Resources Conference and Dinner Takeaways

pportunity list has shifted geographically over the

past five years, with growth now concentrated in the U.S. Gulf (driven by deeper, high-

pressure activity), South America (Guyana, Suriname, Brazil), and East Africa

(Mozambique, Namibia), as well as Asia Pacific (India, Indonesia, and Malaysia).

Management expects further growth in these regions as regulatory barriers continue to

ease and technology enables more economical project development.

• Competitive landscape favors operating landscape. With a focus on reducing cycle

time, rather than competing on price, FTI has improved client economics and reinforced

its opportunity set to continue to expand margins. Management views competition less

as other industry peers and more as the flow of capital, especially from U.S. shale, and

has successfully shifted incremental capital offshore by supporting favorable project

returns. The company’s selective approach to tendering, strategically avoiding projects

with challenging regulatory environments, ensures that resources are allocated to the

highest-value opportunities. FTI’s customer-centric structure is seen as a key to durable

margins, with little pushback from clients where the construct is mutually beneficial.

FTI’s offering remains differentiated as management sees no limit to the share of direct

awards it can capture, especially as new customers and smaller players enter the offshore

market and seek turnkey solutions that truncate project cycle times and the path to first

oil (or gas).

• Outlook. Looking ahead, FTI expects meaningful growth in inbound orders and revenue,

particularly as the total market has expanded by 30% over the past two years based on the