We put you first. And keep you ahead.

113 Pages·2009·1.84 MB·English

FMCTechnologiesInc
1803GearsRoad
HoustonTX77067
2815914000
We put you first. And keep you ahead.
2008 ANNUAL REPORT
fmctechnologies.com
CorporateOffice Form10-K
FMCTechnologies,Inc. AcopyoftheCompany’s2008AnnualReportonForm
1803GearsRoad 10-K,asfiledwiththeU.S.SecuritiesandExchange
Houston,TX77067 Commission,isavailableatwww.fmctechnologies.com
2815914000 oruponwrittenrequestto:
A C
BOUT THE OVER
FMCTechnologiesgeneratedrecordrevenuesof NamedbyFORTUNEMagazineasAmerica’sMost InvestorRelations FMCTechnologies,Inc.
InvestorRelationsmaybecontactedatthe CorporateCommunications
$4.6billionin2008,strengtheningourpositionasthe AdmiredOilandGasEquipment,ServiceCompany
followingaddress: 1803GearsRoad
leadingglobalprovideroftechnologysolutionsand inthreeofthelastfouryears,FMCTechnologiesis
Houston,TX77067
servicestotheoilandgasindustry.Supportedbya recognizedasaperformance-basedcompanythat FMCTechnologies,Inc.
portfolioofproductsandservicesthatareasdiverse deliversthehighestlevelofquality,integrityand InvestorRelations However,certaininformationrequiredunderPartsII
RobertK.Cherry andIIIoftheCompany’s2008AnnualReportonForm
asour9,800worldwideemployees,wecontinued reliabilityineverythingwedo. Weunderstandour
1803GearsRoad 10-Khavebeenincorporatedbyreferencefromthe
toadvancethecapabilitiesandpossibilitiesofoil customers’businessesandhelpthemovercometheir
Houston,TX77067 Company’sProxyStatementforits2009Annual
productionthroughthedesignandmanufactureof mostdifficultoperationalchallenges.Bydeveloping 2815914560 MeetingofShareholders.
sophisticatedandvalue-addedtechnologies. thetechnologiesandservicesolutionstheyrequireto ir.fmctechnologies.com
succeed,wewillcontinuetoputourcustomersfirst. CertificationsrequiredbySection302oftheSarbanes-
StockExchange OxleyActof2002,asamended,areattachedas
Ourpeopleandourtechnologiescontinuedtosetthe Andkeepthemahead.
FMCTechnologiesislistedonthe ExhibitstotheCompany’s2008AnnualReporton
standardforreliability,efficiencyandperformancein
NewYorkStockExchangeunderthesymbolFTI. Form10-K.FMCTechnologies’CEOtimelysubmitted
2008.Thisincludedthemanufactureofequipment
theCEOAnnualCertificationrequiredbySection
AnnualMeeting
foranumberofglobalprojects,includingsubsea 303A.12(a)oftheNewYorkStockExchangeListed
TheAnnualMeetingofStockholderswillbeheldat
separationandprocessingsystemsforTotal’sPazflor CompanyManualin2008totheNewYork
11:00a.m.onFriday,May15,2009at:
StockExchange.
fieldfeaturedonthefrontcover.Othertechnology
investmentsrangedfromlightwellintervention TheWoodlandsWaterwayMarriottHotel FMCTechnologieswas
systemstoourpatentedliquidnaturalgasoffloading 1601LakeRobbinsDrive incorporatedinDelawarein2000.
TheWoodlands,TX77380
arms,aswellasthedesignanddeliveryofourleading
Noticeofthemeeting,togetherwithproxy Auditors
pumps,wellheads,swiveljointsandmeters.
materials,willbemailedtostockholdersinadvance KPMGLLP
ofthemeeting. Houston,TX77067
StockTransferAgent
Addressstockholderinquiries,includingrequestsfor
stocktransfers,to:
NationalCityBank
CorporateTrustOperations
P.O.Box92301
Cleveland,OH44193-0900
Telephone:[phone]
Fax:[phone]
Email: [email protected]
AnnualReport2008
Inside
ToOurEmployeesandShareholders........................................2
LetterfromtheCFO......................................................................6
BusinessReview
EnergyProductionSystems................................................8
EnergyProcessingSystems..............................................16
CoreValues....................................................................................20
BoardofDirectorsandOfficers................................................22
Form10-K......................................................................................24
Financial Highlights
(Inmillions,exceptpershareandcommonstockdata) 2007 2008
Totalrevenue $ 3,648.9 $ 4,550.9
Incomefromcontinuingoperations $ 260.6 $ 352.9
Dilutedearningspershare:
Incomefromcontinuingoperations $ 1.95 $ 2.72
Financialandotherdata:
Commonstockpricerange $ 27.76-$66.86 $ 20.34-$80.86
Net(debt)cash $ 0.2 $ (154.9)
Orderbacklog $ 4,490.7 $ 3,651.2
Numberofemployees 8,900 9,800
Revenue:
EnergyProductionSystems $ 2,882.2 79% $ 3,670.7 81%
EnergyProcessingSystems $ 767.7 21% $ 883.2 19%
Eliminations $ (1.0) 0% $ (3.0) 0%
Total $ 3,648.9 $ 4,550.9
$3,671
$421
$2,882
$2,250 $288
$1,771
$191
$1,270 $165
$128 $142
$672 $768 $883 $90 $101
$493 $522 $54
$27
2004 2005 2006 2007 2008 2004 2005 2006 2007 2008
RevenuebySegment–$M OperatingProfitbySegment–$M
EnergyProductionSystems EnergyProcessingSystems
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FMCTechnologies,Inc.
We maintain a STRONG COMPETITIVE ADVANTAGE due
to our innovative & sophisticated technology solutions.
Fortheseventhstraightyear,FMCTechnologies Wecompletedthespin-offofFoodTechandAirport
achievedrecordresults.Revenueincreased Systems,nowJBTCorporation,allowingustobe
25percentto$4.6billion,ledbythegrowthof completelyfocusedonourenergybusinesses.The
oursubseasystemsbusiness,andearningsper spin-offwasimplementedthroughatax-free
sharefromcontinuingoperationsof$2.72wereup dividendtoallFMCshareholders.
39percentcomparedto2007.Theseandourother
financialresultsunderscoretheinvestmentswe Globalsubsearevenuereached$3billionin2008,
havemadeinourpeople,facilitiesandtechnology, andduringtheyear,wereceivedordersforatotal
andourabilitytodevelopandmaintainstrong of122newsubseaproductiontreesfor38projects
customerrelationshipsandlong-termalliances. from22differentcustomers.Theseawardscame
Manyofournewtechnologiesenablemoreefficient fromallmajoroffshorebasinsaroundtheworld–
andcost-effectiveproductionofoilandgasthatwill theGulfofMexico,theNorthSea,Brazil,West
allowFMCtocontinuetosupportourcustomers’ AfricaandtheFarEast.
increasingchallengesofdeepwaterdevelopments.
IntheGulfofMexico,Shell’sPerdidodevelopment
wastheseconddeploymentofFMC’ssubsea
separationtechnologiesandthefirstuseofsubsea
separationinthisregion.Inaddition,wesetanew
worldsubseacompletiondepthrecordof9,356feet
(2,850meters)withPerdido,surpassingour
previouslyestablishedrecordsetin2007with
Anadarko’sIndependenceHubprojectat8,995feet
(2,740meters).
Brazil GulfofMexico
PeterD.Kinnear SubseaProduction–WaterDepthRecords
Chairman,PresidentandCEO
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AnnualReport2008
Wesawthesuccessfulprogressionofseveral Whilesubseasystems,ourlargestandfastest S
R
previouslyawardedprojectsduringtheyear. growingbusiness,hadanotheroutstandingyear,the
E
Specifically,webeganworkonourlargestsubsea otherbusinessesinourenergyportfolioalso D
L
orderever,the$980millionPazflorproject, deliveredsolidperformances.Oursurfacewellhead
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operatedoffshoreAngolabyTotal.Thisprojectis businesshadrecordgrowth,withsignificant H
E
significantduetoitscomplexityaswellassize, increasesinorders,revenueandprofitability.
R
withthreesubseaseparationsystemsinaddition EnergyProcessing,comprisedofourfluidcontrol, A
H
to49subseatrees. loadingsystems,measurementsolutionsand
S
materialhandlingsolutionsbusinesses,setrecord
&
Anotherimportantdevelopmentwasthesigningof resultsforrevenueandprofitabilityaswell.Notably,
severalnewstrategic,multi-yearallianceagreements SamsungandFlexLNGawardedourloading S
E
withourcustomersAnadarkoPetroleum,Devon systemsbusinessacontractforoffshoreliquefied E
Y
Energy,LLOGExplorationandNobleEnergy.These naturalgas(LNG)offloading.Thecontractisthe
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alliancesbenefitbothFMCandourcustomersby largestreceivedinthehistoryofourloading L
providingaframeworkforbudgeting,forecasting, systemsbusiness.Inaddition,ourmaterialhandling P
M
procurementanddelivery,thusmakingproject solutionsbusinesswasselectedtodesignand
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executionmoreefficient.Wearealsoproudofour supplythehandlingsystemsforthePrairieState
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continuedlong-termrelationshipswithcustomers, EnergyCampusProjectinIllinois,thelargest
U
includingBP,Chevron,CNR,ConocoPhillips,Eni, coal-firedpowergenerationplantunder O
Hess,Nexen,Petro-Canada,Petrobras,Shell, constructionintheUnitedStates.
O
StatoilHydro,TotalandWoodsideEnergy.
T
Topositionthecompanyforfuturegrowth,we
purchaseda45percentinterestinSchilling
RoboticsLLC,amanufacturerofremotelyoperated
vehicles(ROVs),manipulatorsystemsandother
high-technologyequipmentusedinsubseaoiland
gasexploration.Asmoresubseasystems,suchas
subseaprocessingsolutions,areinstalledonthe
oceanfloor,weenvisionanincreaseduseofROVs
duringthelifeofthesubseafield,includingthe
initialinstallation,maintenanceandmonitoringof
equipmentontheseabed.
Toremainatechnologyleaderandthesupplierof
choicetoourcustomers,itisessentialthatwe
continuallydevelopnew,innovativeequipment,
servicesandsolutionsforourcustomers.FMC
currentlyhasmorethan30newsubseatechnologies
indifferentstagesofdevelopmentthatwillbenefit
ourcustomers.Severalwillbelaunchedin2009.
ASchillingRoboticsROVreadytobelaunchedinto
thewater.
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FMCTechnologies,Inc.
FMCTechnologieshasalongstandinghistoryof HSEexcellenceisdeeplyembeddedinourcorporate
safeoperationthatpromotesemployeehealthand cultureandhasbeenouroperatingmodelfor
environmentalstewardship.Wecontinuedthat decades.ItisoneofourCoreValues,alongwith
outstandingHealth,SafetyandEnvironmental(HSE) Integrity,Innovation,Collaboration,Respectand
performancein2008. Accountability.
TwoofthemeasurementsweusetoassessourHSE IformallyintroducedtheseCoreValuestoall
progressareRecordableandLostWorkdayIncident employeesinthefourthquarterof2008.Inthis
rates,bothcalculatedperevery200,000hours year’sannualreport,Ihavealsodedicatedasection
worked.Thesmallerthenumber,thebetterour introducingourvaluestoeveryshareholder.Our
performance.Lastyear,ourRecordableIncident CoreValuesrepresentwhatFMCexpectsofeach
Ratewas0.57;ourLostWorkdayIncidentRatewas employee.Theyalsoserveasapromiseofwhatour
0.06,farsurpassingtheindustrybenchmarksofthe employees,customers,shareholders,communities
top-performingoilandgasservicecompanies.By andsupplierscanexpectfromFMC.Quitesimply,
comparison,thesecompaniesexperiencedarateof theyarethefoundationforhowwewillconduct
0.77forrecordableincidentsand0.23forlost business.Theywillserveasaguideforouractions
workdayincidents. anddecisionseveryday,andwilldistinguishthe
FMCTechnologiesbrandworldwide.Thisincludesa
Weestablishednewmetricsforhigh-riskactivities pledgetobeastrongcorporatecitizeninallaspects
inanefforttopreventpotentialinjuries,including ofourbusiness.
thoseinvolvingpressuretesting.Equipmentsize
andpressurescontinuetoincrease,andnew Everyday,ouremployeesaroundtheworldare
technologiesarebeingdevelopedtoallow makingalastingimpactonthecommunitiesin
customerstoproduceinevenmoredemanding whichtheyliveandwork.Beyondthecommitment
operatingenvironments.Itistherefore,both ofdailyworkactivities,theyarereachingoutto
practicalandnecessarytoestablishmore theirschools,neighborsandcivicorganizations,
comprehensivepressuretestingproceduresthat providingneededservicesandenrichingthelives
canimprovesafetyforouremployees,customers ofthosearoundthem.
andtheenvironmentsinwhichtheyoperate.
0.80 0.77
0.62
0.57
0.53
0.23
0.17
0.14
0.10
0.06
2005 2006 2007 2008 2008
FMCTechnologies TopOil&
GasServiceCo’s
Recordable&LostWorkdayIncidentRatesper200,000HoursWorked
RecordableIncidents LostWorkdayIncidents
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AnnualReport2008
SincebecomingCEO,Ihaveencouragedour inaccordancewithourpreviouslyannounced
employeestogivetheirtimeandsupporttoanyof successionplan,JosephH.Netherland,after
theworthycausesforwhichtheyarepassionate 35years,retiredfromFMCTechnologies.
about.Iamveryimpressedwithourglobal Hisleadershipanddedicationwillbemissedby
responseasemployeesengagedinnumerous thosewhoworkedwithhim.TheBoardofDirectors
charityandoutreachprograms,includingsupport subsequentlyappointedmeChairmanofFMC
oflocaleducationforschool-agedchildren, Technologies,apositionInowholdinadditionto
sponsorshipofadultliteracyprograms,fundraising mydutiesasPresidentandChiefExecutiveOfficer.
forthebenefitoforphanagesandtheeffortto
provideguidedogsfortheblind. FMCwasabletogeneraterecordresultsby
respondingtocustomerneedsandrecognizingthe
While2008wasanoutstandingyear,wemust trendsofourindustry.Oursoundstrategiesand
continuallystriveforimprovementsineveryaspect financialdisciplineresultedincompetitive
ofourbusiness.Establishingstandardglobal advantagesandsolidifiedourleadershippositionin
processes,utilizingbestpracticesandproviding allkeymarketsinwhichweparticipate.Wemust
superbprojectexecutionareessentialcomponents continuetomanageourbusinesseswitha
tofuturegrowth.Successintheseareaswill dedicationtogrowth,soundfinancialperformance
improvequalityandon-timedeliveryandincrease andtechnologyimprovement,andacommitmentto
profitability. ourcustomerstodeliverqualityinallaspectsof
ourwork.
Today,wemaintainastrong,competitiveadvantage
becauseofourinnovativeandsophisticated Likeeveryyear,2009willoffernewandunique
technologicalsolutions.Aswelookto2009and challengesandopportunities.Bymaintaininga
beyond,itisimperativethatwebuilduponthis consistentfocusonflawlessexecution,continuing
achievementineveryaspectofourbusiness, toinvestinthedevelopmentofinnovative
embeddingaqualityculturethroughoutFMCthat technologiesandensuringwepossessthemost
mirrorsourindustry-leadingsafetyperformance. talentedworkforceintheindustry,wewillremain
Itisequallyimportanttoensurethatweeliminate positionedtosucceedevenintoday’suncertain
inefficienciesfromourprocessesandthatwe businessclimate.
continuetodeliversuperiorproductsandservices,
ontime,toourcustomers.
During2008,wemadeanumberofkey
managementappointments.Theseincluded PeterD.Kinnear
thepromotionofJayA.NuttasController Chairman,PresidentandCEO
ofthecompanyandtheappointmentof FMCTechnologies,Inc.
JeffreyS.BeyersdorferasTreasurer.Inaddition,
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FMCTechnologies,Inc.
SUPERIOR PERFORMANCE & INTEGRITY are
the guiding principles for our business.
2008wasanotherstrongandprofitableyearfor reduceourdependencyonexternalcreditmarkets,
FMCTechnologies.Operatingprofitfrom allowingmanagementtodirectthecashintonew
continuingoperationsroseto$506million,a profitableinvestments.
25percentincrease,andincomefromcontinuing
Toensureourbusinessesremainprofitable,we
operationsincreasedto$353million,a35percent
haveprocessesinplacethatmonitorandassessthe
improvementovertheprioryear.Earningspershare
ongoingprofitabilityandcapitalrequirementsof
fromcontinuingoperationsrose39percentto
eachoperatingunit.Weexaminetrends,including
$2.72,whileafter-taxreturnoninvestment
profitability,workingcapital(receivables,inventory,
increasedto30percentattheendof2008.Total
customeradvancesandpayablesduetosuppliers)
companybacklog,agoodindicatoroffuture
andcapitalspending.Evaluatingtheseandother
revenue,stoodat$3.7billion.
performancemetricsallowsustoanticipate
AfundamentalreasonforthesuccessofFMClies challengesandreactquicklyandeffectivelywhen
inourcapabilitytogenerateoperatingcashflow, opportunitiesarise.Thecomingyearwilllikelytest
whichwas$262millionin2008.FMC’sabilityto theseprocesses,giventheexpecteddeclinein
generatepositivecashflowisafunctionofthe oilfieldactivity.
intrinsicprofitabilityofourproductsandservices
andthelimitedamountoffixedandworkingcapital
needsofourbusinessunits.Sinceourbusinessesdo
notrequirelargeamountsofcapitaltofunction,
theyarecapableofgeneratingexcesscashflowin
mosteconomicenvironments.Asaresult,we
$4.5
$3.7
$2.3
$1.7
$1.3
2004 2005 2006 2007 2008
WilliamH.Schumann,III
ExecutiveVicePresidentandCFO
Backlog–$B
6
AnnualReport2008
Highreturnsoncapitalindicatethatabusinessis FMCisafinanciallysoundcompanyandispoised T
R
wellmanagedandpossessesadvantagesoverits tosurvivethischallengingeconomicenvironment.
O
competition.Employingmorecapitalathigherrates Asalways,ourgoalsaretofurtherstrengthenour P
E
ofreturncreatesshareholdervalue.During2008,we industryleadershipposition,becomeaneven
R
usedourexcesscashto: strongercompanyandgenerateexcessfreecash
O
flow,resultinginanincreaseinshareholdervalue.
• Investapproximately$165millionincapital F
Webelievewehavethestrategies,disciplineand
C
expenditurestosustainourcurrentbusinesses
peopleinplacetocontinuetoachievethosegoals.
andfundtheorganicgrowthofnew
businesses,suchaswellinterventionsystems
andinvestmentsintechnologydevelopments.
• Acquirepartialownershipofnewbusinesses, WilliamH.Schumann,III
suchasSchillingRoboticsLLC,tobring ExecutiveVicePresidentandCFO
additionalgrowthopportunities. FMCTechnologies,Inc.
• Repurchase5.7millionsharesofstocktoreturn
capitaltoshareholders.
Asyoureviewourfinancialstatements,youwill
seethatFMChasaverystrongbalancesheet.We
currentlyhaveapproximately$495millionindebt,
whichisaverysmallfigureforacompanyofour
size.Ourcashlevelatyearendof$340million
resultedinanetdebtpositionof$155millionat
December31,2008.Our$600millionrevolving
creditfacilityhasunusedcapacityof$114million,
whichprovidesuswithsufficientliquidity.
Moreover,webegan2009byaddinganothercredit
facilityof$350milliontoprovideuswithadded
flexibility.Duetooursoundbalancesheet,FMCis
inaverystrongpositiontoinvestinfuturegrowth
opportunities.
$542.8 30.3 $179.6 $165.0
23.7
$115.6
16.2
$261.8 13.8 $69.9
$167.6 9.7
$26.9
$51.7
($79.0)
2004 2006 2007 2008 2004 2005 2006 2007 2008 2004 2005 2006 2007 2008
2005
OperatingCashFlow–$M ReturnonInvestment–% CapitalExpenditures–$M
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FMCTechnologies,Inc.
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