Paris, October 17, 2007
Achieving Profitable Growth
- Focus on the Group's core business: solutions for the Oil & Gas industry
- Proactive commitment to technology and know-how
- €1 billion investment program to develop the Group's industrial and marine assets
- Further expansion in key regions
- Foster operational performance
Thierry Pilenko, Chairman and CEO of Technip presented today the Group's strategic framework and objectives for the year 2010 to achieve profitable growth.
In a buoyant market environment for oil and gas services, the Group holds leading positions on its three market segments: the development of Subsea hydrocarbon fields, Offshore platforms adapted to varied water depths, and major Onshore projects such as natural gas liquefaction (LNG), grass roots refineries and new petrochemical units.
Technip will focus on its core business in order to best respond to the needs of the oil and gas industry by capitalizing upon the Group's strengths:
- a proactive commitment to technologies and know-how in order to provide innovative solutions to meet the challenges of the "new frontiers" (offshore developments at water depths exceeding 3,000 meters, Arctic developments, treatment of unconventional resources, onshore mega projects, reduction of CO2 emissions),
- development of the integrated industrial and marine capacities in the Subsea segment (vessel fleet, flexible pipe and umbilical fabrication plants) with an investment program of approximately €1 billion by 2010,
- further geographic expansion to be as close as possible to clients, in particular in the Middle East and Asia-Pacific regions, and a stronger presence on "new frontiers": Canada (tar sands) and the Arctic.
To improve operating performance, Technip will concentrate on four initiatives:
- a gradual change of the risk profile of Onshore activities with, in particular, a larger share of services contracts and contractual terms adapted to each project;
- the strengthening of execution capacity, both internally and externally, and the commitment to become the reference company in the industry in terms of Quality and Safety,
- the implementation of a more focused, empowered and accountable operational organization led by a Chief Operating Officer, with six Regions that are fully accountable for projects and client relations, an integrated business unit in charge of Subsea assets and technologies, and eight product lines providing expertise to the Regions,
- developing talent worldwide with, in particular, the deployment of the "Technip University", an ambitious mentoring program, and new schemes to reward individual performance.
This strategic framework will provide Technip with the means to expand its leadership in the oil and gas industry, increase its profitability, and attain its financial goals for 2010:
- group operating margin ratio of 8%,
- double digit annual growth in Subsea activities with a return on capital employed (ROCE) above 15%,
- improved profitability in Offshore and Onshore, with an operating margin ratio target of 6%.
According to Thierry Pilenko : "In an era when oil and gas projects are increasingly complex and demanding, Technip, united in this strategic and operational framework, has the means to make a decisive contribution to the development of new technologies and provide our clients with sustainable solutions to optimize the management of the world's energy resources"