Financial Data and Key Metrics Changes - TechnipFMC has established itself as a premier offshore equipment company with a strong backlog and higher margins through its Subsea two point zero offering [1][5] - The company is on track to book $30 billion in orders over the last three years and expects another $10 billion next year [7][8] Business Line Data and Key Metrics Changes - The Subsea business has seen an increase in customer base and geographical reach, expanding from 10-12 customers to a broader market [8][10] - Subsea two point zero now represents over 50% of inbound orders, indicating a shift towards more predictable and efficient project execution [32][37] Market Data and Key Metrics Changes - The offshore market is experiencing a resurgence, with increased confidence from clients leading to higher investments [5][15] - Brownfield investments are expected to continue growing due to their high returns and existing capital infrastructure [16] Company Strategy and Development Direction - The company focuses on reducing cycle times and improving project delivery through its Subsea two point zero and integrated offerings [24][48] - TechnipFMC aims to maintain its competitive edge by ensuring predictable project execution and enhancing client confidence in offshore investments [25][42] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the sustainability of the offshore resurgence and the company's ability to grow orders, revenue, and earnings [6][14] - The company acknowledges the need for continuous improvement in execution and delivery to meet higher industry standards [41][46] Other Important Information - TechnipFMC has built new facilities in Saudi Arabia and the UAE to enhance its international business capabilities [58][59] - The Surface Technologies business is primarily driven by the Middle East, with significant contributions from Saudi Arabia and the UAE [56][62] Q&A Session Summary Question: How is the order book evolving? - The order book has expanded with more customers and projects, reflecting a growing interest in offshore investments [8][10] Question: What is the mix of orders between greenfield and brownfield? - The mix includes a surprising level of greenfield projects, with brownfields continuing to attract high levels of investment due to their better returns [14][16] Question: How does TechnipFMC differentiate itself from competitors? - The company competes for capital flows, emphasizing the quality of offshore reservoirs and the ability to deliver projects on time and within budget [22][24] Question: What is the significance of Subsea two point zero? - Subsea two point zero allows for more predictable project execution and has become a significant portion of the order book, driving future earnings growth [32][33] Question: What are the key markets for the Surface Technologies business? - The key markets include the Middle East, particularly Saudi Arabia and the UAE, which are technically challenging but align with the company's strengths [56][62]

Financial Data and Key Metrics Changes - TechnipFMC has established itself as a leading offshore equipment company with a strong backlog and higher margins through its Subsea two point zero offering [1] - The company is on track to book $30 billion in orders over the last three years and expects another $10 billion next year, indicating a growing backlog that will convert to revenue and earnings [8][7] Business Line Data and Key Metrics Changes - The Subsea business has seen an expansion in its customer base, moving from 10-12 customers to a broader range due to increased offshore investment and TechnipFMC's integrated offerings [9] - Subsea two point zero currently represents 70% of the order book, with expectations for this to grow as it provides predictability and efficiency in project delivery [24][30] Market Data and Key Metrics Changes - The company has expanded its geographical reach, moving from three to four operational pockets globally to a more extensive network, enhancing its market presence [9] - The shift in capital flows towards offshore projects has been noted, with clients showing increased confidence in investing offshore due to TechnipFMC's ability to deliver projects on time and within budget [14][23] Company Strategy and Development Direction - TechnipFMC's strategy focuses on reducing cycle times and improving project delivery through its Subsea two point zero and integrated offerings, which enhance predictability and performance [22][46] - The company is competing for capital flows rather than just against other companies, emphasizing the importance of delivering better project economics and execution [20][47] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the sustainability of the offshore resurgence and the company's ability to grow in orders, revenue, and earnings [6][7] - The management acknowledged the industry's past inefficiencies and emphasized the importance of improved execution and delivery standards in the current market [39][42] Other Important Information - The Surface Technologies business is primarily driven by the Middle East, with significant contributions from Saudi Arabia and the UAE, and is expected to see growth in 2026 [56][61] - TechnipFMC has built new facilities in Saudi Arabia and the UAE to meet local content requirements and support international operations [58][59] Q&A Session Summary Question: How is the order book evolving? - The order book has expanded with more customers and projects, reflecting a growing interest in offshore investments and TechnipFMC's integrated offerings [8][9] Question: What is the mix of orders between greenfield and brownfield projects? - The company has seen a surprising increase in greenfield projects, while brownfield investments continue to be significant due to their high returns [15] Question: How does TechnipFMC differentiate itself from competitors? - The company focuses on capital flows and project execution rather than just competing with other companies, emphasizing the quality of offshore reservoirs and the importance of reducing cycle times [20][47] Question: What is the expected growth for the Surface Technologies business? - The international Surface Technologies business is shaping up nicely, with a focus on project-based work in the Middle East [61][63]

Financial Data and Key Metrics Changes - TechnipFMC has established itself as a leading offshore equipment company with a strong backlog and visibility, indicating structurally higher margins through its Subsea 2.0 offering [1][4] - The company is on track to book $30 billion in orders over the last three years, with an expectation of another $10 billion in the next year [6][10] Business Line Data and Key Metrics Changes - The Subsea 2.0 offering currently represents about 70% of the order book but only 30% of revenue, indicating potential for revenue growth as the backlog converts [21][24] - The company has seen an expansion in its customer base and geographical reach, moving from 3-4 operational pockets globally to a much broader presence [7][8] Market Data and Key Metrics Changes - The offshore market is experiencing a resurgence, with increased confidence from clients leading to a higher volume of investments in offshore projects [4][11] - Greenfield projects have surprised the company, making up about 50% of inbound orders in 2024, indicating a shift in capital flows towards offshore investments [10][11] Company Strategy and Development Direction - The company focuses on reducing cycle times and improving project delivery predictability, which is critical for attracting capital investments [18][39] - TechnipFMC's strategy emphasizes the importance of technology and execution, with ongoing investments in robotics and other innovations to enhance manufacturing efficiency [41][42] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the sustainability of the offshore market resurgence and the company's ability to grow in all areas, which is not typical in the industry [4][5] - The company acknowledges the need for continuous improvement in project delivery standards compared to previous cycles, which were characterized by inefficiencies [34][35] Other Important Information - The Surface Technologies business represents a smaller segment, with significant revenue coming from international markets, particularly the Middle East [45][46] - New facilities in Saudi Arabia and the UAE are expected to enhance the company's operational capabilities and meet local content requirements [48] Q&A Session Summary Question: How is the order book evolving? - The order book has expanded with more customers and projects, reflecting a growing interest in offshore investments [6][10] Question: What is the mix of orders expected in the coming years? - The mix will include a combination of greenfield and brownfield projects, with a notable increase in brownfield investments due to better returns [11][12] Question: How does Subsea 2.0 impact revenue? - Subsea 2.0 is expected to drive revenue growth as it becomes a larger portion of the order book, with increased manufacturing efficiency [21][24] Question: What are the key markets for Surface Technologies? - The key markets include the Middle East, particularly Saudi Arabia and the UAE, which are technically challenging but align with the company's strengths [45][46] Question: What is the outlook for international business growth? - The international business is shaping up positively, with expectations for growth in 2026 [50]

Core Insights - TechnipFMC plc (FTI) reported second-quarter 2025 adjusted earnings of 68 cents per share, exceeding the Zacks Consensus Estimate of 57 cents and up from 43 cents in the prior year, driven by strong performance in the Subsea segment [1][9] - The company's revenues reached $2.5 billion, surpassing the Zacks Consensus Estimate by 2.2% and increasing from $2.3 billion in the year-ago quarter [2][9] - FTI's order backlog rose to $16.6 billion, a 19.8% increase year-over-year, despite a decline in inbound orders by 8.4% to $3.1 billion [3][9] Financial Performance - Adjusted EBITDA for the Subsea unit was $482.9 million, exceeding the consensus estimate of $453 million, while the Surface Technologies unit reported adjusted EBITDA of $52.3 million, also above the consensus of $48.6 million [2] - Total costs and expenses for the quarter were $2.1 billion, a 6.3% increase from the previous year's $2 billion [8] - The company generated $344.2 million in cash flow from operations and reported free cash flow of $260.6 million [8] Segment Analysis - Subsea segment revenues totaled $2.2 billion, a 10.3% increase from $2 billion in the prior year, driven by increased project activity in the North Sea and Brazil [5][6] - Adjusted EBITDA in the Subsea segment rose by approximately 35.5% year-over-year, supported by strong execution and higher project activity [6] - Surface Technologies segment revenues were $318.4 million, up 0.6% year-over-year, with adjusted EBITDA increasing by 13.7% due to higher activity in the Middle East [7] Shareholder Returns - The board declared a quarterly cash dividend of 5 cents per share, unchanged from the previous quarter, to be paid on September 3, 2025 [3] - The company repurchased 8.3 million common shares for a total of $250.1 million, resulting in total shareholder returns of $270.7 million for the quarter [4] 2025 Outlook - FTI expects Subsea unit revenues between $8.4 billion and $8.8 billion for 2025, and Surface Technologies revenues between $1.2 billion and $1.35 billion [10] - The anticipated adjusted EBITDA margin for the Subsea segment is 19-20%, while for Surface Technologies it is expected to be 15-16% [10] - Free cash flow is projected to be in the range of $1 billion to $1.15 billion for 2025 [10]

Core Insights - FTI Consulting has appointed Sabine Bennett as a Senior Managing Director in the Australian Healthcare & Human Services practice [1] - Ms. Bennett brings over 16 years of experience in technology-enabled transformation programs for health, aged care, and life sciences clients [2] - The Healthcare & Human Services practice focuses on sector reform, digital transformation, and productivity, having launched in January 2025 [3] Company Overview - FTI Consulting is a global expert firm with over 7,900 employees across 32 countries as of June 30, 2025 [5] - The company generated $3.70 billion in revenues during fiscal year 2024 [5] Industry Focus - The practice aims to support clients in creating digital solutions that enhance patient and clinician experiences [2][3] - Ms. Bennett emphasizes the ambition of Australian organizations in Digital and AI, highlighting the challenges in execution [4]

Core Insights - FTI Consulting has appointed Elizabeth (Liz) Goodman as a Senior Managing Director in the Healthcare and Life Sciences practice within its Strategic Communications segment [1][4] Company Overview - FTI Consulting, Inc. is a leading global expert firm specializing in crisis and transformation, with over 7,900 employees across 32 countries and territories as of June 30, 2025 [6] - The company generated $3.70 billion in revenues during the fiscal year 2024 [6] Appointment Details - Dr. Goodman brings over 30 years of experience in healthcare, health insurance, and health law and policy, focusing on Medicare, Medicaid, and long-term services [2] - In her new role, Dr. Goodman will assist healthcare and life sciences payers and providers in navigating complex business environments, advising C-suite executives on brand equity, stakeholder management, and risk mitigation [3][5] - Her previous roles include Chief Legal and Public Affairs Officer at Commonwealth Care Alliance and Executive Vice President of Government Affairs and Innovation at America's Health Insurance Plans [4] Strategic Goals - Dr. Goodman aims to address regulatory shifts, evolving care models, and changing expectations in the healthcare sector, collaborating with FTI Consulting's experts to develop strategies for business-critical challenges [5] - The hiring of Dr. Goodman is part of the ongoing expansion of the Healthcare and Life Sciences practice at FTI Consulting, following several recent appointments in public affairs and corporate reputation [5]

Core Insights - FTI Consulting reported Q2 2025 earnings that exceeded Wall Street expectations despite a mild decline in revenue and earnings per share compared to the previous year [1][2] - The company generated GAAP revenue of $943.7 million, surpassing estimates by $21.7 million, and GAAP earnings per share of $2.13, exceeding the $2.10 estimate [1][2] - The performance varied significantly across different business segments, with some experiencing growth while others faced challenges due to macroeconomic factors [1] Financial Performance - Q2 2025 GAAP revenue was $943.7 million, a decrease of 0.6% year-over-year from $949.2 million in Q2 2024 [2] - GAAP earnings per share fell by 9.0% from $2.34 in Q2 2024 to $2.13 in Q2 2025 [2] - Adjusted EBITDA decreased by 3.7% to $111.6 million from $115.9 million in the prior year [2] - Net income dropped 14.5% to $71.7 million from $83.9 million in Q2 2024 [2] - Operating margin was 10.5%, down from 11.0% in the previous year [2] Business Segments Overview - Corporate Finance & Restructuring segment reported $379.2 million in GAAP revenue, up 9.0% year-over-year, driven by increased demand for restructuring services [5] - Forensic and Litigation Consulting generated $186.5 million in GAAP revenue, a 10.0% increase, benefiting from higher bill rates [6] - Economic Consulting saw a significant decline in GAAP revenue to $191.7 million, down 17.0% due to reduced deal volume [7] - Technology unit's revenue fell 27.9% to $83.6 million, impacted by lower demand for merger-related projects [8] - Strategic Communications achieved strong growth with revenue up 20.8% to $102.7 million, driven by increased demand for reputation management services [10] Cash Flow and Balance Sheet - Cash generated from operations decreased to $55.7 million from $135.2 million in Q2 2024, primarily due to higher forgivable loan issuances and increased compensation payments [11] - Net debt rose to $317.2 million from a net cash position of $166.4 million a year earlier [11] - Total liabilities increased to $1.59 billion, reflecting higher long-term debt and commitments to retain talent [12] Future Guidance - Management updated FY2025 revenue guidance to a range of $3.66 billion to $3.76 billion, indicating flat growth compared to FY2024 [13] - Full-year GAAP earnings per share is projected between $7.24 and $7.84, with adjusted EPS forecasted between $7.80 and $8.40 [13] - The company highlighted potential declines in adjusted EPS for the first time in a decade due to ongoing weakness in certain segments [13]

Core Insights - FTI Consulting, Inc. (FCN) reported strong second-quarter 2025 results with earnings and revenues exceeding the Zacks Consensus Estimate, but the stock price remained flat post-earnings release [1][7] - Adjusted EPS was $2.13, beating estimates by 14% but down 9% year over year; total revenues were $943.7 million, surpassing estimates by 3.6% but declining 0.6% year over year [1][7] Segment Performance - Technology revenues decreased by 27.9% year over year to $83.6 million, primarily due to lower demand for M&A-related "second request" services [3] - Economic Consulting revenues fell 17% year over year to $191.7 million, driven by reduced demand for M&A-related antitrust services, partially offset by higher realized bill rates [3] - Corporate Finance & Restructuring revenues increased by 9% year over year to $379.2 million, attributed to higher demand for restructuring services and increased bill rates [4] - Strategic Communications revenues rose by 20.8% year over year to $102.7 million, mainly due to an increase in pass-through revenues and demand for corporate reputation services [5] - Forensic and Litigation Consulting revenues grew by 10% year over year to $186.5 million, supported by higher realized bill rates for risk and investigations services [8] Financial Metrics - Adjusted EBITDA was $111.6 million, down 3.7% year over year, with an adjusted EBITDA margin declining by 410 basis points to 8.7% [9] - The company ended the quarter with cash and cash equivalents of $152.8 million, down from $226.4 million in the prior quarter, and generated $55.7 million from operating activities [10] Guidance - FCN projects full-year 2025 revenues between $3.66 billion and $3.76 billion, with EPS expected to range from $7.24 to $7.84 [11] - The company anticipates additional capital expenditures of $29 million to $36 million for the remainder of 2025 [12]

[PART I - Financial Information](index=4&type=section&id=PART%20I%20-%20Financial%20Information) [Item 1. Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) For the six months ended June 30, 2025, TechnipFMC reported a 9.2% increase in total revenue to $4.77 billion and a 19.8% rise in net income attributable to the company to $411.5 million compared to the prior year, with total assets growing to $10.08 billion and operating cash flow significantly improving to $785.9 million [Condensed Consolidated Statements of Income](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) The company reported significant year-over-year growth in both the second quarter and first half of 2025, with total revenue for the six months ended June 30, 2025, increasing to $4.77 billion and net income attributable to TechnipFMC rising to $411.5 million Consolidated Income Statement Highlights (Unaudited) | Indicator (In millions, except EPS) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change | | :--- | :--- | :--- | :--- | | **Total Revenue** | $4,768.3 | $4,367.6 | +9.2% | | **Income Before Income Taxes** | $605.1 | $456.1 | +32.7% | | **Net Income Attributable to TechnipFMC** | $411.5 | $343.6 | +19.8% | | **Diluted EPS** | $0.97 | $0.78 | +24.4% | Q2 Consolidated Income Statement Highlights (Unaudited) | Indicator (In millions, except EPS) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change | | :--- | :--- | :--- | :--- | | **Total Revenue** | $2,534.7 | $2,325.6 | +9.0% | | **Income Before Income Taxes** | $374.8 | $245.5 | +52.7% | | **Net Income Attributable to TechnipFMC** | $269.5 | $186.5 | +44.5% | | **Diluted EPS** | $0.64 | $0.42 | +52.4% | [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets increased to **$10.08 billion** from **$9.87 billion** at year-end 2024, driven by higher contract assets and inventories, while total liabilities remained stable at **$6.79 billion** and total stockholders' equity grew to **$3.30 billion** Condensed Consolidated Balance Sheet Highlights (Unaudited) | Indicator (In millions) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $950.0 | $1,157.7 | | **Total Assets** | **$10,081.9** | **$9,869.2** | | Total current liabilities | $5,091.0 | $4,864.8 | | Long-term debt | $425.1 | $607.3 | | **Total Liabilities** | **$6,785.3** | **$6,730.8** | | **Total Equity** | **$3,296.6** | **$3,138.4** | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the first six months of 2025, cash provided by operating activities significantly increased to **$785.9 million** from **$104.2 million** in the prior-year period, though a sharp rise in cash used in financing activities, including **$500.2 million** in share repurchases, resulted in a net decrease in cash and cash equivalents of **$207.7 million** Six-Month Cash Flow Summary (Unaudited) | Cash Flow Activity (In millions) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Cash provided by operating activities | $785.9 | $104.2 | | Cash provided (required) by investing activities | $(140.8) | $87.1 | | Cash required by financing activities | $(880.8) | $(417.9) | | **Change in cash and cash equivalents** | **$(207.7)** | **$(243.5)** | - Key financing activities in H1 2025 included **$500.2 million** in share repurchases and **$241.6 million** in debt repayments, significantly increasing cash used in financing compared to H1 2024[20](index=20&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail the company's financial performance, highlighting strong revenue growth in the Subsea segment, particularly in Latin America, with the order backlog growing to **$16.6 billion**, an improved debt profile due to repayments and investment-grade credit rating upgrades, and continued shareholder returns through dividends and an accelerated share repurchase program - The Subsea segment is the primary revenue driver, with Latin America being the largest geographical market, contributing **$1.48 billion** in the first six months of 2025[38](index=38&type=chunk) - Total order backlog stood at **$16.6 billion** as of June 30, 2025, with the Subsea segment accounting for **$15.8 billion**[48](index=48&type=chunk)[49](index=49&type=chunk) - The company's credit ratings were upgraded to investment grade by S&P and Fitch, and to 'Baa3' by Moody's, leading to the release of collateral on its credit facilities[80](index=80&type=chunk)[81](index=81&type=chunk) - In the first six months of 2025, the company repurchased **$500.2 million** of its ordinary shares and paid **$41.6 million** in dividends[84](index=84&type=chunk)[85](index=85&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management maintains a positive long-term outlook, driven by strong demand in offshore and Middle East markets and technological leadership in iEPCI™ and Subsea 2.0®, with consolidated revenue for H1 2025 growing 9.2% to **$4.8 billion** led by a 10.9% increase in the Subsea segment, and the company's order backlog growing to **$16.6 billion** providing strong future visibility and robust liquidity [Business Outlook](index=28&type=section&id=Business%20Outlook) The company has a positive long-term outlook for oil and natural gas, with offshore and Middle East markets being preferred for investment, and is positioned to leverage its technology, such as iEPCI™ and Subsea 2.0®, to capture growth in both conventional energy and new energy areas, with Subsea inbound orders expected to exceed **$10 billion** for the year - The company maintains a positive long-term outlook for oil and gas, anticipating growth in energy demand, with a focus on offshore and Middle East markets[124](index=124&type=chunk)[125](index=125&type=chunk) - Technological differentiation through iEPCI™ and Subsea 2.0® is a key strategy to improve project economics and reduce cycle times[128](index=128&type=chunk)[129](index=129&type=chunk) - The company is actively expanding into New Energy, focusing on greenhouse gas removal, offshore floating renewables, and hydrogen solutions[126](index=126&type=chunk)[127](index=127&type=chunk) - Subsea inbound orders are expected to exceed **$10 billion** in the current year, contributing to a three-year total of over **$30 billion** by the end of 2025[134](index=134&type=chunk) [Consolidated Results of Operations](index=30&type=section&id=Consolidated%20Results%20of%20Operations) For the second quarter of 2025, revenue increased 9.0% year-over-year to **$2.53 billion**, and net income grew 44.0% to **$268.3 million**, while for the first six months, revenue rose 9.2% to **$4.77 billion**, and net income increased 18.5% to **$411.6 million**, primarily driven by higher activity and favorable project mix in the Subsea segment Q2 2025 vs Q2 2024 Consolidated Results | Indicator (In millions) | Q2 2025 | Q2 2024 | Change (%) | | :--- | :--- | :--- | :--- | | **Revenue** | $2,534.7 | $2,325.6 | +9.0% | | **Gross Profit** | $593.3 | $500.9 | +18.4% | | **Net Income** | $268.3 | $186.3 | +44.0% | H1 2025 vs H1 2024 Consolidated Results | Indicator (In millions) | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | **Revenue** | $4,768.3 | $4,367.6 | +9.2% | | **Gross Profit** | $1,058.2 | $842.3 | +25.6% | | **Net Income** | $411.6 | $347.2 | +18.5% | - Revenue growth in both Q2 and H1 2025 was primarily driven by the Subsea segment's conversion of a higher backlog and increased activity in key regions like Brazil, Israel, Norway, and Nigeria[140](index=140&type=chunk)[150](index=150&type=chunk) [Segment Results of Operations](index=33&type=section&id=Segment%20Results%20of%20Operations) The Subsea segment demonstrated strong performance, with H1 2025 revenue increasing 10.9% to **$4.15 billion** and operating profit surging 44.6% to **$628.2 million**, while the Surface Technologies segment's H1 revenue decreased slightly by 1.3% to **$615.8 million**, and its operating profit fell to **$53.6 million** primarily due to a **$75.2 million** gain on an asset sale in the prior year and higher restructuring costs in the current year Subsea Segment Performance (H1 2025 vs H1 2024) | Indicator (In millions) | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | **Revenue** | $4,152.5 | $3,743.9 | +10.9% | | **Operating Profit** | $628.2 | $434.3 | +44.6% | | **Operating Margin** | 15.1% | 11.6% | +3.5 pts | Surface Technologies Segment Performance (H1 2025 vs H1 2024) | Indicator (In millions) | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | **Revenue** | $615.8 | $623.7 | -1.3% | | **Operating Profit** | $53.6 | $134.0 | -60.0% | | **Operating Margin** | 8.7% | 21.5% | -12.8 pts | - The significant decrease in Surface Technologies' operating profit was primarily due to a **$75.2 million** gain on the sale of the Measurement Solutions business in Q1 2024 and **$16.4 million** in restructuring costs in H1 2025[169](index=169&type=chunk) [Inbound Orders and Order Backlog](index=35&type=section&id=Inbound%20Orders%20and%20Order%20Backlog) Total inbound orders for the first six months of 2025 were strong at **$5.92 billion**, comparable to the prior year, and the total order backlog increased significantly to **$16.65 billion** as of June 30, 2025, up from **$14.38 billion** at the end of 2024, driven by the Subsea segment whose backlog rose by **$2.3 billion** to **$15.81 billion** Inbound Orders (In millions) | Segment | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Subsea | $5,338.6 | $5,241.8 | | Surface Technologies | $581.5 | $624.8 | | **Total** | **$5,920.1** | **$5,866.6** | Order Backlog (In millions) | Segment | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Subsea | $15,810.0 | $13,518.1 | | Surface Technologies | $835.9 | $858.2 | | **Total** | **$16,645.9** | **$14,376.3** | [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20Capital%20Resources) The company's financial position remains strong, with net cash of **$253.7 million** at the end of Q2 2025, robust operating cash flow of **$785.9 million** for the first half, ample liquidity with **$1.25 billion** available under its revolving credit facility, and key capital allocation activities including **$500.2 million** in share repurchases and **$41.6 million** in dividends during the first six months of 2025, further enhanced by recent investment-grade credit rating upgrades Net Cash Reconciliation (In millions) | Component | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $950.0 | $1,157.7 | | Total Debt | $(696.3) | $(885.2) | | **Net Cash** | **$253.7** | **$272.5** | - The company received investment-grade credit rating upgrades from S&P ('BBB-') and Fitch ('BBB-'), and an upgrade from Moody's ('Baa3'), which resulted in the release of collateral securing its credit agreements[184](index=184&type=chunk)[185](index=185&type=chunk)[186](index=186&type=chunk) - The company repurchased **$500.2 million** of ordinary shares in H1 2025 and has **$594.4 million** remaining under its current authorization[189](index=189&type=chunk) - A quarterly cash dividend of **$0.05 per share** was declared, continuing the company's commitment to shareholder returns[187](index=187&type=chunk)[188](index=188&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=38&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that its exposure to market risk has not materially changed since the disclosures made in its Annual Report on Form 10-K for the year ended December 31, 2024 - There have been no material changes in the company's market risk exposure since December 31, 2024[195](index=195&type=chunk) [Item 4. Controls and Procedures](index=38&type=section&id=Item%204.%20Controls%20and%20Procedures) Based on an evaluation as of June 30, 2025, the CEO and CFO concluded that the company's disclosure controls and procedures were effective, with no material changes in internal control over financial reporting during the quarter - The CEO and CFO concluded that as of June 30, 2025, the company's disclosure controls and procedures were effective[196](index=196&type=chunk) - No changes occurred in internal control over financial reporting during Q2 2025 that have materially affected, or are reasonably likely to materially affect, these controls[197](index=197&type=chunk) [PART II - Other Information](index=39&type=section&id=PART%20II%20-%20Other%20Information) [Item 1. Legal Proceedings](index=39&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal actions in the ordinary course of business but does not anticipate that their ultimate resolution will have a material adverse effect on its financial condition, results of operations, or cash flows - Management believes that the most probable outcome of pending legal matters will not have a material adverse effect on the company's financial position[198](index=198&type=chunk) [Item 1A. Risk Factors](index=39&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes or updates to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes to the company's risk factors have occurred since the filing of the 2024 Annual Report on Form 10-K[199](index=199&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=39&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the second quarter of 2025, the company repurchased a total of **8,275,628** ordinary shares for **$250.1 million** at an average price of **$30.21 per share** as part of its publicly announced share repurchase program Issuer Purchases of Equity Securities (Q2 2025) | Period (2025) | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April | 2,825,600 | $28.31 | | May | 3,988,600 | $30.08 | | June | 1,461,428 | $34.25 | | **Total** | **8,275,628** | **$30.21** | [Item 5. Other Information](index=40&type=section&id=Item%205.%20Other%20Information) During the second quarter of 2025, several of the company's executive officers, including the CEO and CFO, adopted Rule 10b5-1 trading arrangements for the future sale and gifting of company shares - Key executives, including CEO Douglas J. Pferdehirt and CFO Alf Melin, adopted Rule 10b5-1 trading plans on June 23, 2025, for future transactions in company stock[205](index=205&type=chunk)[206](index=206&type=chunk)

Financial Data and Key Metrics Changes - Total company revenue for the quarter was $2,500,000,000 with an Adjusted EBITDA of $509,000,000, reflecting a margin of 20.1% when excluding foreign exchange impacts [7][22] - Free cash flow generated was $261,000,000, with total shareholder distributions amounting to $271,000,000 through dividends and share buybacks [7][25] - The total company backlog increased by 5% sequentially to €16,600,000,000 [22] Business Line Data and Key Metrics Changes - In the Subsea segment, revenue was DKK2.2 billion, a 14% increase compared to the first quarter, driven by increased iEPCI project activity in the North Sea and higher installation activity in Brazil [22][23] - Surface Technologies revenue was €318,000,000, a 7% increase from the first quarter, primarily due to higher project and services activity in the Middle East [23][24] - Adjusted EBITDA for Subsea was €483,000,000, up 44% sequentially, with an EBITDA margin of 21.8% [23] Market Data and Key Metrics Changes - In North America, the company has reduced its footprint by 50% over the last three years while improving operating margins and increasing cash flow [10] - International markets now represent nearly two-thirds of Surface Technologies revenue, focusing on core markets with long-term production growth ambitions [10] - Subsea orders achieved $2,600,000,000 in the quarter, with a strong performance in Subsea Services, particularly in greenfield developments [11][12] Company Strategy and Development Direction - The company is focused on transforming its Subsea operations through new commercial models and configurable product offerings, enhancing customer relationships and technology leadership [8][20] - The strategy includes exiting unprofitable markets and consolidating facilities in North America while emphasizing operational efficiency [10] - The company aims to reach a three-year goal of $30,000,000,000 in Subsea inbound by the end of the year, supported by a robust order book [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating current market challenges and highlighted the importance of strong customer relationships and technology innovation [20] - The outlook for offshore activity remains robust, with significant project sanctioning expected in regions like Guyana and Mozambique [17][19] - The company anticipates continued strength in Subsea revenue growth and an adjusted EBITDA margin similar to the current quarter [25][27] Other Important Information - The company has increased its full-year guidance for total company adjusted EBITDA to approximately $1,800,000,000, a 30% increase compared to the prior year [28] - The company has committed to distributing at least 70% of free cash flow to shareholders, with a current distribution rate of 85% [28] Q&A Session Summary Question: Breakdown of Subsea order book composition - Management confirmed that the strong performance in Subsea Services is a result of successful market strategies and direct awards, indicating a positive trend for the business [31][32] Question: Expectations for awards in the second half - Management indicated that both the Subsea opportunities list and direct awards are expected to contribute to future awards, with confidence in maintaining a robust level of direct awards [34][36] Question: Growth trajectory for services revenue - Management confirmed that services revenue is expected to grow in line with Subsea revenue, with a strong installed base contributing to long-term sustainability [42][44] Question: Insights on brownfield and greenfield project appetite - Management noted a strong commitment to advancing both greenfield and brownfield projects, with significant capital flowing into offshore markets [51][53] Question: Emerging areas for activity outside the Golden Triangle - Management highlighted the importance of regions like East Africa and the Eastern Mediterranean, along with ongoing projects in Brazil and Guyana [61][63] Question: Competitive dynamics in the Middle East - Management emphasized the unique challenges of the Middle East market and the company's focus on technology and high-end services to maintain a competitive edge [70][72] Question: Pricing dynamics in the market - Management clarified that over 80% of their business is direct awarded, which mitigates competitive pricing pressures, focusing instead on project returns and cycle time [88][91] Question: Potential of hybrid flexible pipe technology - Management expressed optimism about the hybrid flexible pipe's applicability across various markets, emphasizing its advantages in weight and installation costs [96][98]