TechnipFMC (FTI) risk factors, FY2024 10-K

Risks Related to Our Business and Industry

1. 01Demand for our products and services depends on oil and natural gas industry activity and expenditure levels, which are directly affected by trends in the demand for and price of oil and natural gas
2. 02We operate in a highly competitive environment and unanticipated changes relating to competitive factors in our industry, including ongoing industry consolidation, may impact our results of operations
3. 03Our success depends on the ongoing development and implementation of new product designs, including the processes used by us to produce and market our products
4. 04Additionally, we are exploring opportunities in GHG removal, offshore floating renewables (wind, wave and tidal energy), and hydrogen. Many technologies involved in those projects are novel and will need to be further developed before we can determine whether a renewable energy project is technologically feasible
5. 05Due to the types of contracts we enter into and the markets in which we operate, the cumulative loss of several major contracts, customers, or alliances may have an adverse effect on our results of operations, and the credit and commercial terms of certain contracts may subject us to further risks
6. 06Disruptions in the political, regulatory, economic, and social conditions or public health crises in the countries in which we conduct business could adversely affect our business or results of operations
7. 07Unexpected geopolitical events, armed conflicts and terrorism threats continue to grow in a number of key countries where we currently or may in the future conduct business
8. 08personnel, impairment of our or our customers’ ability to execute business strategy and continue operations, and potential claims by our customers of a force majeure situation and payment disputes
9. 09DTC may cease to act as the depository and clearing agency for our shares
10. 10As of December 31, 2024, our total debt was $0.9 billion. We also have the capacity under our Credit Agreement to incur additional debt
11. 11A downgrade in our debt rating could restrict our ability to access financing
12. 12Our acquisition and divestiture activities involve substantial risks
13. 13Increasing scrutiny and expectations regarding sustainability matters could result in additional costs or risks or otherwise adversely affect our business
14. 14We are exploring investments in energy transition, and uncertainties with respect to these markets may adversely affect our business

Risks Related to Our Operations

1. 15We may lose money on fixed-price contracts
2. 16Our failure to timely deliver our backlog could affect future sales, profitability, and relationships with our customers
3. 17We face risks relating to our reliance on subcontractors, suppliers, and our joint venture partners
4. 18A failure or breach of our IT infrastructure or that of our subcontractors, suppliers, or joint venture partners, including as a result of cyber-attacks, could adversely impact our business and results of operations
5. 19Pirates and maritime conflicts endanger our maritime employees and assets
6. 20Capital asset construction projects for vessels and manufacturing facilities are subject to risks, including delays and cost overruns, which could have a material adverse effect on our financial condition, or results of operations

Risks Related to Legal Proceedings, Tax and Regulatory Matters

1. 21The industries in which we operate or have operated expose us to potential liabilities, including as a result of the installation or use of our products, which may not be covered by insurance or may be in excess of policy limits, or for which expected recoveries may not be realized
2. 22Our operations require us to comply with numerous regulations, violations of which could have a material adverse effect on our financial condition, results of operations, or cash flows
3. 23Compliance with environmental and climate change-related laws and regulations may adversely affect our business and results of operations
4. 24Existing or future laws and regulations relating to greenhouse gas emissions and climate change may adversely affect our business
5. 25Uninsured claims and litigation against us, including product liability and personal injury claims and intellectual property litigation, could adversely impact our financial condition, results of operations, or cash flows
6. 26We are subject to governmental regulation and other legal obligations related to privacy, data protection, and data security. Our actual or perceived failure to comply with such obligations could harm our business
7. 27Geral de Proteção de Dados (“LGPD”) in Brazil. The EU GDPR, UK GDPR, and implementing legislation (collectively, “GDPR”) comprehensively regulates our use of personal data, which have increased our obligations, regarding cross-border transfers of personal data outside of the EEA and the UK
8. 28The IRS may not agree that we should be treated as a foreign corporation for U.S. federal tax purposes and may seek to impose an excise tax on gains recognized by certain individuals
9. 29U.S. tax laws and/or guidance could affect our ability to engage in certain acquisition strategies and certain internal restructurings
10. 30We are subject to the tax laws of numerous jurisdictions; challenges to the interpretation of, or future changes to, such laws could adversely affect us
11. 31We may not qualify for benefits under tax treaties entered into between the United Kingdom and other countries
12. 32We intend to be treated exclusively as a resident of the United Kingdom for tax purposes, but French or other tax authorities may seek to treat us as a tax resident of another jurisdiction
13. 33Significant changes or developments in U.S. or other national trade policies, including tariffs, and the reactions of other countries thereto, may have a material adverse effect on our business and results of operations
14. 34Our businesses are dependent on the continuing services of our key managers and employees
15. 35Seasonal, weather, and other climatic conditions could adversely affect demand for our services and operations
16. 36Currency exchange rate fluctuations could adversely affect our financial condition, results of operations, or cash flows
17. 37We are exposed to risks in connection with our defined benefit pension plan commitments
18. 38We may be unable to obtain sufficient bonding capacity for certain contracts, and the need for performance and surety bonds could reduce availability under our credit facility