Cash & Liquidity Management

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Interview: Philippe Soulenq, Technip “Project management, difficult but exciting”

Philippe Soulenq

Joint Director of the Group Treasury at Technip

“Project management, difficult but exciting”

Tell us a little about the company.

Technip, one of the world leaders in project management, engineering and construction in the energy sector, employs almost 30,000 people in 48 countries. Business ranges from subsea to offshore and onshore infrastructure – engineering, construction and installation of fixed or floating platforms, onshore facilities for the production, processing and transport of oil and gas, petrochemicals, even renewable energy such as offshore wind farms. The group also has industrial assets and 34 ships involved in the installation of pipes and underwater construction. In 2011, turnover was €6.8bn, operating profit was €709m and the order book €10.4bn. Technip, which is listed on Euronext Paris – and a member of the CAC 40 – has a market capitalisation of €8.7bn.

How is the treasury structured?

In 1999, we put a central office in place, intended to pool the needs and surplus of our subsidiaries, as well as hedge market risk. The department has two jobs: firstly and primarily managing the treasury and market risk via the central office, but also to ensure the monitoring and control of the group’s financial and legal commitments, managing banking relationships and compliance with management procedures, the latter with these two words in mind: securitisation and optimisation. The securitisation of cash flow, throughput and commitments is very important for us and goes a long way towards explaining our policies: in the field of investment and financing, for example, we use very reliable products and careful risk management of bank counterparties.

In addition, our role is to disseminate good management practice and to support our subsidiaries in the areas of treasury and the IT systems linked to them. The team, which has a dozen members, is run by Paul-Alain Mulner, director of the treasury group, and myself. There are three parts to it: the front office, the back office – which is also involved in banking and corporate guarantees, the back office for long-term financing, and deals with bank documentation – and cash management. These services are supported by cross-functional ‘project SI [Information System]’ teams made up of some of our employees. Financing for the group and our projects is run by a separate department.

What is your cash management policy?

I don’t have a set cash pooling policy. The pragmatism is de rigueur: it depends on our aims – maximum centralisation of needs and surplus, optimising cash pooling and minimising the internal costs for the treasury and for accounting – but also on specific local conditions and the level of responsibility that the group wishes to allow to subsidiaries. We can therefore turn to a banking service or to manual cash pooling where the transfers are initiated by the subsidiaries. The latter system is very reliable because of a detailed weekly view of the cash and debts of each subsidiary, thanks to an Oracle-Hyperion Planning IT system that was put in place seven years ago.

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