PARIS: French oil services group Technip stuck to its revenue and operating margin targets for this year and next on Thursday, saying it was confident it could still win contracts despite the decline in oil prices.
Quarterly group revenue rose 18 percent to 2.82 billion euros ($3.55 billion), Technip said in a statement. Operating profit rose 10 percent to 241.5 million euros, giving a margin of 8.5 percent. Net profit fell 12.3 percent at 131.6 million.
Analysts had expected net profit of 157.8 million euros, operating profit of 230.5 million and revenue of 2.68 billion on average, according to a Thomson Reuters I/B/E/S poll.
"We can report a quarter of sales and profit growth, strong order intake, momentum in our cost reduction and good cash generation," Chairman and Chief Executive Thierry Pilenko said in the statement.
Pilenko said on a conference call with reporters that weaker oil prices, which have dropped by 25 percent over the past four months, and tighter spending budgets at oil majors meant Technip had approached clients earlier than usual to offer less costly options.
"What I said remains valid in an environment where prices are at $85 per barrel or even lower: we engage discussions with our clients very early to try to find economical solutions," he said.
Earlier this year, the Paris-based company cut its targets for its onshore/offshore unit, which builds oil rigs and liquefied natural gas (LNG) plants, citing the possible impact of sanctions on Russia.
Technip won the engineering, procurement and construction contract for the Yamal LNG project in Russia in May. The giant LNG export project in Siberia is owned by Russia's Novatek , French oil company Total and China's CNPC.
On Thursday, Technip's CEO told reporters the project was "proceeding as per plan".
The group is also feeling the effect of slowing investment by oil majors, which is making life harder for equipment and service suppliers worldwide.
But Pilenko said the group could still win contracts, even in an environment where oil companies are more cost-conscious, pointing to its order backlog of 19.3 billion euros at the end of September.
"If you look at the past nine months, we have actually been able to have an order intake of around 12 billion euros, which is as much as the entire year of 2013," he said.
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