* CEO says no meaningful change in client projects
* Sees capex growth among oil & gas clients in 2014
* Q2 net profit 162.4 mln eur vs consensus 158.8 mln
* Group sales 2.42 bln eur vs 2.33 bln consensus
* Current operating margin 10 pct
(Adds CEO comments, detail)
By Michel Rose
PARIS, July 25 French oil services company
Technip posted a sharp rise in second-quarter profit,
beating analyst forecasts as it secured new contracts for pipes
in West Africa and North America, seemingly unaffected by the
woes of its competitors.
The builder of oil rigs maintained its full-year earnings
growth targets after it reported a 19 percent year-on-year rise
in quarterly net profit to 162 million euros ($215 million) and
an operating margin of 10 percent.
It confirmed a forecast for group sales to grow by between
11 and 16 percent in 2013 and its operating margin to be around
15 percent at its subsea unit and 6-7 percent at its
Technip shares rose 2.9 percent by 0705 GMT on Thursday, the
top gainer on the CAC 40 index of French blue-chip stocks
"The margin of 15.9 percent in the subsea division shows the
growth potential for margins from 2014 once new assets, two
vessels and a plant, are up and running," said Julien Laurent,
energy analyst at Natixis in Paris.
The results stand out because competitors such as Italy's
Saipem, the sector leader, and Norwegian groups Aker
and Subsea 7 have all issued profit warnings
this year, blaming Brazilian activities.
In Brazil, dominant national company Petrobras's
negotiating tactics and government demands have combined to
squeeze industry profit margins. Saipem has also been embroiled
in a corruption scandal in Algeria.
"In the last few months, we have not seen any meaningful
change in our clients' drive to sanction new projects," Technip
Chief Executive Thierry Pilenko said on a conference call.
The Paris-based group had reaffirmed its 2013 financial
targets last month after Milan-based Saipem, partly owned by oil
and gas major ENI, issued its second profit warning in
Technip's order intake stood at 2.8 billion euros in the
three months to the end of June, up from 2.5 billion a year ago.
Its oil company clients, helped by prices above $100 per
barrel, have raised exploration spending, venturing into
areas requiring new techniques to get access to oil - such as
the Arctic or very deep waters off west Africa.
"Capital expenditure programmes are still growing. Clients
are talking about growth for next year," Pilenko said. "The
quantification of this growth is too early to tell. People are
talking anywhere between 5 and 15 percent depending on the
Second-quarter current operating profit rose 17 percent to
242 million euros on 18 percent sales growth to 2.42 billion.
Analysts on average expected current operating profit of
234.4 million euros, net profit of 158.8 million and sales of
2.33 billion, according to Thomson Reuters I/B/E/S.
Asked about future costs in its supply chain, Technip's CEO
struck an upbeat note as the economic slowdown may bring metals
prices such as steel down.
"There's something which has not yet trickled down the
supply chain, which is the fact that steel capacity in the world
has increased dramatically, putting pressure on the cost of
steel," Pilenko said in the call.
"Over the next couple of years, we may see better prices for
steel, which bodes well for offshore construction, which takes a
lot of steel."
Shares in Technip sit roughly where they were at the start
of 2013, in line with the broader European oil & gas sector
, while Saipem's have tumbled by close to 50 percent.
($1 = 0.7555 euros)
(Reporting by Michel Rose; editing by Mark John and Tom