The following is a summary of the Subsea 7 S.A. (SUBCY) Q2 2024 Earnings Call Transcript:
Financial Performance:
Q2 adjusted EBITDA was $292 million, up 80% year-over-year with a margin of 17%.
Q2 revenue rose to $1.7 billion, up 15%, driven by Subsea and Conventional units.
Business Progress:
Completed the Gas to Energy project in Guyana ahead of schedule using Seven Borealis.
Investing in new assets like the 250-tonne crane class vessel, renamed Seven Merlin.
Opportunity:
Tender pipeline at $21 billion signals robust outlook for Subsea, Renewable segments.
Engaging in bids for major offshore wind projects in Europe and the U.S.
Risk:
Geopolitical and financial market uncertainties could impact project financing.
Currency fluctuations could affect net finance costs and profitability.
Financial Performance:
Subsea 7 reported a Q2 adjusted EBITDA of $292 million, a 80% increase year-over-year with a margin of 17%.
Revenue increased to $1.7 billion, up 15% compared to Q2 2023, primarily driven by Subsea and Conventional business units.
Net income for Q2 was $63 million compared to $14 million in the same period last year.
Order intake reached $4 billion due to new awards in multiple regions with a book-to-bill ratio of 2.3x for the quarter.
The backlog by the end of the the first half was a record $12.5 billion, providing good visibility into future revenue.
Business Progress:
Subsea 7 has successfully completed projects, such as the Gas to Energy project in Guyana, ahead of schedule using the Seven Borealis ship.
Focused on selective tendering in the renewables sector to maintain margins and returns.
Investments in new assets like the 250-tonne crane class construction vessel, renamed Seven Merlin, to support future projects.
Developed enabling products to optimize field development and performance such as specialized, corrosion-resistant rigid pipelines and optimized pipeline bundles.
Opportunities:
Continued positive outlook for the Subsea and Renewable segments, supported by a robust tendering pipeline valued over $21 billion.
Expansion in emerging geographic markets like Brazil and through new energy projects in Guyana.
Engagement in bidding activities for significant offshore wind projects in Europe and the U.S.
Strategic investments in new vessels and technology to enhance operational efficiency.
Risks:
Geopolitical and financial market uncertainties which may affect project financing and execution.
Fluctuations in currency which can impact net finance costs and overall profitability.
More details: SUBSEA 7 S.A. ADR EACH REPR 1 COM SPON IR
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