Oil services company TechnipFMC said on Wednesday it would slash the salaries of executives and retainers paid to company directors by 30%, after cutting its dividend by 75% in search of savings to cushion the impact of the novel coronavirus outbreak.
The Franco-American firm, whose clients include major companies in the oil and gas sector, said it had increased its cost savings target to more than $350 million this year from the $130 million it announced on April 1.
It lowered executive compensation for the year, cutting the salary of its chairman and chief executive officer by 30%. It reduced the board of directors' retainers by 30% and its executive leadership team's salaries by 20%.
"Over the last two months, much about the world has changed, and we are taking swift and decisive actions in response to the market environment," Chairman and CEO Doug Pferdehirt said in a statement.
The company said on Tuesday it would pay $0.13 per share as a dividend this year instead of every quarter, due to the sharp decline in commodity pricing and the impact of COVID-19, the respiratory disease caused by the novel coronavirus.
The company said revenue in the first three months of the year was at $3.13 billion, up 7.5% from the same period a year ago, while the net loss was at $3.256 billion, versus a year-ago net profit of $20.9 million.
After-tax charges of 3.2 billion in the latest quarter included non-cash impairment and other charges totalling $3.15 billion for goodwill and other assets in the Subsea and Surface Technologies segments.
Cash flow from operations in the quarter was $27.9 million.
In its Subsea, TechnipFMC said the global COVID-19 pandemic created headwinds to both revenue and profit in the quarter.
"Project and service disruptions varied, and in some instances, the impacts delayed revenue recognition to future periods," it said.
The group, created three years ago via the merger of Technip and FMC after the oil price crash of 2015, had been planning to separate its engineering and construction activities from its upstream oil services business in the first half of this year, but suspended that due to the market turmoil.
Major oil producers with operations around the world have cut their 2020 capital spending by more than 26%, or $60.5 billion, data compiled by Reuters showed, following a slump in crude prices.
Technip said it had a backlog of $22 billion, and $5.6 billion in cash and liquidity.
(Reporting by Bate Felix; Editing by Peter Cooney)