Technip Energies cuts margin outlook as Middle East hit deepens

Technip Energies

30/07/2026 06:30

July 30 (Reuters) - French engineering and technology company Technip Energies TE.PA cut its 2026 margin outlook on Thursday after disruption at Middle Eastern projects and related provisions drove second-quarter core earnings well below expectations, overshadowing record orders.
Adjusted recurring earnings before interest, taxes, depreciation and amortisation fell 60% to 63.5 million euros ($72.3 million) from 156.9 million euros a year earlier, far below the 152 million euros expected in a company-compiled consensus.
Revenue rose 4% to 1.87 billion euros, missing analysts' expectations of 1.92 billion euros.
The results mark a deterioration from April, when Technip largely described the impact of the Middle East conflict as delayed project activity and revenue. It has now recognised provisions related to disputed items, as well as additional logistics, safety and business continuity costs.
Technip said its projects in the region remained fully mobilised and activity had stabilised, but warned that the amount and timing of cost recovery under contractual protections would depend on the evolution of the conflict and discussions with customers.
The company cut its 2026 EBITDA margin forecast for its Project Delivery division to above 5% from 6.5%-7.5%, while maintaining revenue guidance of 5.7 billion to 6.3 billion euros.
The revised outlook assumes current market conditions persist through the end of the year.
Project Delivery EBITDA fell to 23.8 million euros from 100.9 million euros a year earlier, while its margin dropped to 1.7% from 7.6%, despite a 7% increase in revenue to 1.42 billion euros.
Technip raised its margin outlook for its Technology, Products and Services unit to around 15% from 14.5% after the division posted quarterly EBITDA of 69 million euros and a margin of 15.4%.
First-half order intake reached 12.7 billion euros, lifting backlog to a record 25 billion euros from 16 billion euros at the end of 2025.
However, 14.4 billion euros of that backlog is scheduled for 2028 and beyond, meaning much of the benefit is unlikely to offset near-term pressure on Project Delivery margins.
($1 = 0.8787 euros)

 (Reporting by Jesus Calero in Gdansk; Editing by Matt Scuffham)
 ((jesus.calero@thomsonreuters.com))