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1. Company Snapshot

1.a. Company Description

Subsea 7 S.A. delivers offshore projects and services for the evolving energy industry worldwide.It provides subsea field development products and services, including project management, design and engineering, procurement, fabrication, survey, installation, and commissioning of production facilities on the seabed and the tie-back of its facilities to fixed or floating platforms or to the shore.The company also offers engineering, procurement, commissioning, and installation of subsea umbilicals, risers, and flowlines; inspection, repair, maintenance, remote intervention, and integrity management of subsea infrastructure services; conventional services comprising fabrication, installation, extension, and refurbishment of fixed and floating platforms and associated pipelines in shallow water; and hook-up services.


In addition, it operates heavy lifting operations and heavy transportation services for renewables structures; and installs offshore wind turbine foundations and inter-array cables, as well as engages in the decommissioning of redundant offshore structures.Further, the company provides remotely operated vehicles (ROVs) and tooling services to support exploration and production activities, as well as engineering and advisory services for customers in the oil and gas, renewables, and utilities industries.As of December 31, 2021, it has a fleet of 38 vessels.


Subsea 7 S.A. was incorporated in 1993 and is based in Luxembourg.

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1.b. Last Insights on SUBC

Subsea 7 S.A.'s recent performance was driven by strong operational and financial results, with Adjusted EBITDA of $360 million, up 23% on the prior year period, and a margin of 21%. The company's Conventional and Renewables segment showed strength, with Adjusted EBITDA margins of 21% and 17%, respectively. Additionally, Subsea 7 secured several major contracts, including a $50-$150 million subsea contract offshore Egypt and a $150-$300M subsea EPCI contract offshore Norway. The company's project footprint expanded with strategic new work in the region, and it began work on a substantial subsea contract offshore Norway.

1.c. Company Highlights

2. Subsea 7's Q3 2025 Earnings: A Strong Backlog and Refined Guidance

Subsea 7 reported an adjusted EBITDA of $407 million, a 27% year-on-year growth, with a margin of 22%. Revenue was $1.8 billion, in line with the prior year. The company's EPS came in at 3.8, missing estimates of 4.59. The Subsea and Conventional segment reported revenue of $1.5 billion, up 6% year-on-year, with an adjusted EBITDA margin of 24%, while the Renewables segment reported revenue of $302 million, down 19% year-on-year, with an adjusted EBITDA margin of 17%. The company's backlog reached a record high of nearly $14 billion, driven by a book-to-bill of 2.1x for the quarter.

Publication Date: Nov -21

📋 Highlights
  • EBITDA Growth & Margin:: Q3 2025 adjusted EBITDA rose 27% YoY to $407M, with a margin of 22%.
  • Record Backlog:: Backlog hit $14B, with a Q3 book-to-bill ratio of 2.1x and 1.4x for YTD 2025.
  • Segment Performance:: Subsea & Conventional revenue grew 6% to $1.5B (24% margin), while Renewables fell 19% to $302M (17% margin).
  • 2025-2026 Guidance:: 2025 revenue guided at $6.9-7.1B (20-21% EBITDA margin); 2026 at $7-7.4B (22% EBITDA margin).
  • Fleet & Cost Optimization:: Lease costs to drop in 2026 due to released vessels, with $300M cash outlay in 2025 for principal/interest.

Guidance and Outlook

The company has refined its 2025 guidance, expecting revenue of $6.9-7.1 billion and an adjusted EBITDA margin of 20-21%. For 2026, the company expects revenue of $7-7.4 billion and an adjusted EBITDA margin of approximately 22%. CEO John Evans expressed confidence in the company's outlook, citing a high conviction in the resilience of the deepwater Subsea market and a differentiated offering. Analysts estimate next year's revenue growth at 2.9%.

Operational Highlights

The company has seen high tendering activity, with a combined prospect value of around $21 billion. In Renewables, the company is awaiting the outcome of the UK's Allocation Round 7. The company is also making progress with its merger, with the CADE process underway and a target completion date of the second half of 2026. Subsea 7's clients are interested in AI technology, such as 4insight, which has led to significant improvements.

Valuation and Metrics

With a P/E Ratio of 20.25, EV/EBITDA of 5.12, and a Dividend Yield of 6.91%, the market is pricing in a certain level of growth and stability. The company's ROIC is 6.26%, and ROE is 6.31%, indicating a reasonable return on investment. The Net Debt / EBITDA ratio is 0.57, suggesting a healthy debt position.

Future Prospects

The company looks forward to 2026 as a strong year and is in positive discussions about opportunities, particularly in Renewables for 2028 and 2029. The backlog for 2026 is up 13%, and the company expects a step-up in PLSV earnings over the next few years. Further updates on these opportunities and their impact on Seaway 7 are expected to be shared during the Q4 results announcement in late February or early March.

3. NewsRoom

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Is the Subsea 7-Saipem Combination Too Powerful for Brazil?

Dec -04

Source:

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Subsea7 Secures Major Decommissioning Project in the North Sea

Dec -01

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Subsea7 awarded contract offshore UK

Dec -01

Source:

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Are Oils-Energy Stocks Lagging HF Sinclair (DINO) This Year?

Nov -28

Source: zacks.com

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Subsea 7 (OB:SUBC): Exploring Current Valuation After a Steady 20% Share Price Gain

Nov -26

Source:

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Is Subsea 7 (SUBCY) a Solid Growth Stock? 3 Reasons to Think "Yes"

Nov -26

Source:

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BP Taps SLB OneSubsea for Tiber Deepwater Subsea Boosting System

Nov -21

Source: zacks.com

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Subsea 7 SA (ACGYF) Q3 2025 Earnings Call Highlights: Record Backlog and Strong EBITDA Growth ...

Nov -20

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.90%)

6. Segments

Subsea and Conventional

Expected Growth: 4.0%

Subsea 7 S.A.'s 4.0% growth in Subsea and Conventional segments is driven by increasing offshore oil and gas production, rising demand for subsea infrastructure, and growing investments in deepwater projects. Additionally, the company's strategic focus on cost reduction, operational efficiency, and technology advancements also contribute to its growth momentum.

Renewables

Expected Growth: 3.5%

Subsea 7 S.A.'s 3.5% growth in Renewables is driven by increasing demand for offshore wind farms, government incentives for renewable energy, and declining costs of installation and maintenance. Additionally, the company's expertise in subsea engineering and its strategic partnerships with major energy companies contribute to its growth in this segment.

Corporate Business

Expected Growth: 2.5%

Subsea 7 S.A.'s corporate business growth of 2.5% is driven by increasing demand for offshore oil and gas projects, rising energy consumption, and growing investments in renewable energy. Additionally, the company's strategic focus on cost reduction, operational efficiency, and innovative solutions also contribute to its growth.

7. Detailed Products

Subsea Field Development

Subsea 7 provides comprehensive subsea field development services, including engineering, procurement, installation, and commissioning of subsea infrastructure.

Subsea Pipeline Installation

Subsea 7 offers subsea pipeline installation services, including laying and burying pipelines, as well as installing pipeline end terminations.

Subsea Umbilical Installation

Subsea 7 provides subsea umbilical installation services, including the installation of umbilicals, flying leads, and other subsea equipment.

Subsea Inspection, Maintenance, and Repair (IMR)

Subsea 7 offers IMR services, including inspection, maintenance, and repair of subsea infrastructure.

Decommissioning and Abandonment

Subsea 7 provides decommissioning and abandonment services, including the removal and disposal of subsea infrastructure.

Renewable Energy Services

Subsea 7 offers services for the renewable energy sector, including installation and maintenance of offshore wind farms and tidal energy systems.

8. Subsea 7 S.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Subsea 7 S.A. operates in a niche market with high barriers to entry, reducing the threat of substitutes. However, the increasing adoption of renewable energy sources and decreasing oil prices may lead to a shift in demand, posing a moderate threat.

Bargaining Power Of Customers

Subsea 7 S.A.'s customers are primarily large oil and gas companies, which have limited bargaining power due to their dependence on Subsea 7's specialized services.

Bargaining Power Of Suppliers

Subsea 7 S.A. relies on a few key suppliers for specialized equipment and materials, giving them some bargaining power. However, the company's large scale and diversified supply chain mitigate this risk.

Threat Of New Entrants

The high capital requirements, specialized expertise, and regulatory hurdles in the subsea engineering and construction industry create significant barriers to entry, reducing the threat of new entrants.

Intensity Of Rivalry

The subsea engineering and construction industry is highly competitive, with several established players competing for a limited number of large-scale projects, leading to a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 23.16%
Debt Cost 10.85%
Equity Weight 76.84%
Equity Cost 10.85%
WACC 10.85%
Leverage 30.15%

11. Quality Control: Subsea 7 S.A. passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Gaztransport Technigaz

A-Score: 7.0/10

Value: 2.4

Growth: 8.1

Quality: 9.4

Yield: 6.9

Momentum: 8.0

Volatility: 7.0

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Subsea 7

A-Score: 6.2/10

Value: 6.6

Growth: 6.9

Quality: 4.8

Yield: 5.6

Momentum: 6.5

Volatility: 7.0

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A-Score: 6.1/10

Value: 7.0

Growth: 5.1

Quality: 6.1

Yield: 3.8

Momentum: 10.0

Volatility: 4.7

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SBM Offshore

A-Score: 5.8/10

Value: 7.6

Growth: 5.3

Quality: 3.9

Yield: 3.1

Momentum: 8.0

Volatility: 7.0

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Saipem

A-Score: 5.2/10

Value: 8.2

Growth: 3.2

Quality: 4.2

Yield: 5.0

Momentum: 7.0

Volatility: 3.7

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TechnipFMC

A-Score: 4.9/10

Value: 4.8

Growth: 5.1

Quality: 7.1

Yield: 0.6

Momentum: 8.5

Volatility: 3.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

200.6$

Current Price

200.6$

Potential

-0.00%

Expected Cash-Flows