Oilfield equipment manufacturer FMC Technologies Inc. (FTI) reported robust fourth-quarter 2014 results, continuing the trend seen over the past four quarters. Higher revenues from the subsea technologies unit along with an improved North American fluid control business led to the strength.
The Houston, TX-based company posted adjusted diluted earnings per share of 88 cents, up 11.4% from the year-earlier quarter adjusted figure of 79 cents. The bottom line also comfortably surpassed the Zacks Consensus Estimate of 78 cents.
FMC Technologies reported revenues of $2,156.2 million, up more than 5% from $2,047.8 million in fourth-quarter 2013. The top line also beat the Zacks Consensus Estimate of $2,105 million.
For 2014, FMC Tech’s diluted per share profits of $2.95 surged 40.5% from the 2013 level and surpassed the Zacks Consensus Estimate of $2.86. Revenues of $7,942.6 million rose 11.5% from the prior-year figure.
Segmental Analysis
Subsea Technologies: Segment revenues were $1,435.4 million, up 3.3% from the fourth quarter of 2013. Operating profit of $208.4 million came almost in line with the year-ago quarter profit. Improved execution favored the results.
Surface Technologies: Segment revenues rose almost 19.5% year over year to $584.3 million.
Segment operating profit of $116.4 million surged 71% from the year-ago period. The favorable comparison reflects higher fluid control business in North America and strong activities in international surface wellhead operation.
Energy Infrastructure: The segment revenues for the October-December period were $137.8 million, 20.2% lower than the fourth-quarter 2013 level.
Operating profit decreased to $13.7 million from $22.6 million earned in the year-ago quarter. The decline in profit was owing to the absence the company’s Material Handling Products business which was divested in second-quarter 2014.
Backlog
As of Dec 31, 2014, FMC Technologies reported total backlog (including intercompany eliminations) of $6,619.4 million, lower than the prior-year quarter level of $6,998.2 million. Out of this, backlog for Subsea Technologies was $5,793.1 million, while Surface Technologies and Energy Infrastructure backlog were $654.2 million and $187.0 million, respectively.
Balance Sheet
In the reported quarter, FMC Technologies spent $120.7 million on capital programs. As of Dec 31, the company had cash and cash equivalents of $638.8 million and debt of $1,308.9 million, with a debt-to-capitalization ratio of 34.8%.
Zacks Rank & Other Stock Picks
FMC Technologies is a leading manufacturer and supplier of technology solutions for the energy industry. The company currently has a Zacks Rank #5 (Strong Sell).
Better-ranked players in the energy sector include InterOil Corporation (IOC), Golar LNG Partners LP (GMLP) and Tesoro Corporation (TSO). InterOil and Golar LNG sport a Zacks Rank #1 (Strong Buy) while Tesoro carries a Zacks Rank #2 (Buy).
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