Technip profit falls in 2007 but dividend up

Paris: French energy services group Technip posted a 37 per cent fall in 2007 net profit, despite robust demand from oil majors, as charges linked to cost overruns and project delays hurt fourth-quarter earnings.

Technip, which builds oil rigs and deepwater pipe-lines, earned a net profit of 126.3 million euros ($185.9 million) in 2007, compared with 200.1 million in the previous year.

Current operating profit fell to 247 million euros, or 3.1 per cent of sales, from 333.2 million euros, or 4.8 per cent of sales, in 2006.

Analysts had on average expected net income of 126.0 million euros and operating profit of 240 million euros.

Outlook

Technip said yesterday it expected an operating margin in 2008 of above 7.3 per cent. "Technip ends 2007 with contrasting results but starts 2008 on surer footing and with better visibility," Technip chairman and chief executive Thierry Pilenko said in statement.

The company proposed raising its dividend to 1.20 euros a share from 1.05 euros in 2006.

It said its order backlog was 9.39 billion euros at December 31, 2007, compared with 10.27 billion at December 31, 2006. Its cash position was 1.7 billion euros compared with 1.5 billion euros at the end of 2006.