TechnipFMC plc

NOTE 16. DEBT

Overview

Debt consisted of the following:

Debt maturities as of December 31, 2024, are as follows:

Credit Facilities and Debt

Revolving Credit Facility- On February 16, 2021, we entered into a credit agreement, which provided for a $1.0 billion three-year senior secured multi-currency revolving credit facility including a $450.0 million letter of credit sub-facility (the “Revolving Credit Facility”). We incurred $34.8 million of debt issuance costs in connection with the Revolving Credit Facility. These debt issuance costs are deferred and are included in other assets in our consolidated balance sheets. The deferred debt issuance costs are amortized to interest expense over the term of the Revolving Credit Facility.

On April 24, 2023, we entered into a fifth amendment (the “Amendment No. 5”) to the Revolving Credit Facility (as amended, the “Credit Agreement”), which increased the commitments available to the Company to$1.25 billion and extended the term tofive years fromthe date of the Amendment No. 5. The Credit Agreement also provides for a$250.0 million letter of credit sub-facility. We incurred $16.7 million of debt issuance costs in connection with the Amendment No. 5. These debt issuance costs are deferred and are included in other assets in our consolidated balance sheets. The deferred debt issuance costs are amortized to interest expense over the term of the Credit Agreement.

Availability of borrowings under the Credit Agreement is reduced by the outstanding letters of credit issued against the facility. As of December 31, 2024, there wereno letters of credit outstanding and our availability under the Credit Agreement was $1.25 billion.

Borrowings under the Credit Agreement bear interest at the following rates, plus an applicable margin, depending on currency:

•U.S. dollar-denominated loans bear interest, at the Company’s option, at a base rate or an adjusted rate linked to the Secured Overnight Financing Rate (“Adjusted Term SOFR”).

•British pound-denominated loans bear interest on an adjusted rate linked to the British pound interbank offered rate.

•Euro-denominated loans bear interest on an adjusted rate linked to the Euro interbank offered rate.

After the upgrade to ”Investment Grade” as defined in the Credit Agreement by two out of three rating agencies during 2024, the rate for Term Benchmark (as defined in the Credit Agreement) loans is 1.50% and the rate for base rate loan is 0.5% effective from June 28, 2024. The Credit Agreement is subject to customary representations and warranties, covenants, events of default, mandatory repayment provisions and financial covenants.

Letter of Credit Facility -On April 24, 2023, the Company entered into a new$500 million five-year senior secured performance letters of credit facility (the “Performance LC Credit Agreement”). The commitments under the Performance LC Credit Agreement may be increased to$1.0 billion, subject to the satisfaction of certain customary conditions precedent. The Performance LC Credit Agreement permits the Company and its subsidiaries to have access to performance letters of credit denominated in a variety of currencies to support the contracting activities with counterparties that require or request a performance or similar guarantee. It contains substantially the same customary representations and warranties, covenants, events of default, mandatory repayment provisions, and financial covenants as the Credit Agreement and benefits from the same guarantees and security as the Credit Agreement on a pari passu basis.

On March 7, 2024, S&P Global Ratings (“S&P”) upgraded TechnipFMC to investment grade, raising its rating to ‘BBB-’ from ‘BB+’ for both the issuer credit as well as the issue-level ratings on the Company’s senior unsecured notes. On June 27, 2024, Fitch Ratings (“Fitch”) assigned a first-time investment grade long-term issuer default rating of ’BB-’ for TechnipFMC. As a result of the S&P and Fitch investment grade ratings and the satisfaction of certain other conditions precedent, the Investment Grade Debt Rating (as defined in the Credit Agreement) has occurred and the collateral securing the Credit Agreement and the Performance LC Credit Agreement was released and certain negative covenants no longer apply to the Company.

2021 Notes - On January 29, 2021, we issued $1.0 billion of 6.50% senior notes due 2026 (the “2021 Notes”). The interest on the 2021 Notes is paid semi-annually on February 1 and August 1 of each year, beginning on August 1, 2021. The 2021 Notes are senior unsecured obligations and are guaranteed on a senior unsecured basis by substantially all of our wholly owned U.S. subsidiaries and non-U.S. subsidiaries in Brazil, the Netherlands, Norway, Singapore, and the United Kingdom. We incurred $25.7 million of debt issuance costs in connection with issuance of the 2021 Notes. These debt issuance costs are deferred and are included in long-term debt in our consolidated balance sheets. The deferred debt issuance costs are amortized to interest expense over the term of the 2021 Notes, which approximates the effective interest method. The outstanding balance of the 2021 Notes as of December 31, 2024, is $202.9 million.

During 2022, we completed a tender offer and purchased for cash $430.2 million of the outstanding 2021 Notes. We paid a cash premium of $21.5 million to the tendering note holders and wrote off $8.3 million of debt issuance costs. Concurrent with the tender offer, the Company obtained consents of holders with respect to the 2021 Notes to certain proposed amendments (“Proposed Amendments”) to the indenture governing these notes. The Proposed

Amendments, among other things, eliminated substantially all of the restrictive covenants and certain event of default triggers in the indenture.

During 2021, we completedtwo tender offers and purchased for cash $366.9 million of the outstanding 2021 Notes.

As of December 31, 2024, TechnipFMC was in compliance with all debt covenants.

Private Placement Notes

2020 Issuance:

During 2020, we completed the private placement of €200 million aggregate principal amount of senior notes (the “2020 Private Placement Notes”). The 2020 Private Placement Notes bear interest of 5.75% and are due June 2025. Interest on the notes is payable annually in arrears on June 30 of each year beginning June 30, 2020. The 2020 Private Placement Notes contain usual and customary covenants and events of default for notes of this type.

2013 Issuances:

In October 2013, we completed the private placement of €355.0 million aggregate principal amount of senior notes. The notes were issued inthree tranches with €100.0 million bearing interest at 3.75% and due October 2033 (the “Tranche A 2033 Notes”), €130.0 million bearing interest of 3.15% which matured during October 2023 (the “Tranche B 2023 Notes), and €125.0 million bearing interest of 3.15% which also matured during October 2023 (the “Tranche C 2023 Notes” and, collectively with the “Tranche A 2033 Notes” and the “Tranche B 2023 Notes,” the “2013 Private Placement Notes”). Interest on the Tranche A 2033 Notes is payable annually in arrears on October 7 each year, beginning October 7, 2014. During 2023, we repaid the outstanding $270.2 million of our 3.15% October 2023 “Tranche B & C 2023 Notes.”

2012 Issuances:

In June 2012, we completed the private placement of €325.0 million aggregate principal amount of notes. The notes were issued inthree tranches with €150.0 million bearing interest at 3.40% which matured in June 2022 (the “Tranche A 2022 Notes”), €75.0 million bearing interest of 4.0% and due June 2027 (the “Tranche B 2027 Notes”), and €100.0 million bearing interest of 4.0% and due June 2032 (the “Tranche C 2032 Notes” and, collectively with the “Tranche A 2022 Notes” and the “Tranche B 2027 Notes,” the “2012 Private Placement Notes”). Interest on the Tranche C 2032 Notes is payable annually in arrears on June 14 of each year beginning on June 14, 2013. Interest on the Tranche B 2027 Notes is payable annually in arrears on June 15 of each year, beginning on June 15, 2013. During 2022, we repaid the outstanding $161.0 million of our 3.40% June 2022 “Tranche A 2022 Notes.”

The 2013 and 2012 Private Placement Notes contain usual and customary covenants and events of default for notes of this type. In the event of a change of control resulting in a downgrade in the rating of the notes below BBB-, the 2013 and 2012 Private Placement Notes may be redeemed early at the request of any bondholder, at its sole discretion. The 2013 and 2012 Private Placement Notes are our unsecured obligations. The 2013 and 2012 Private Placement Notes rank equally in right of payment with all of our existing and future unsubordinated debt.

Term loan -In December 2016, we entered into a £160.0 million term loan agreement to finance the Deep Explorer, a diving support vessel (“DSV”), maturing in December 2028. Under the loan agreement, interest accrues at an annual rate of 2.813%. This loan agreement contains usual and customary covenants and events of default for loans of this type.

Bank borrowings - In January 2019, we executed a sale-leaseback transaction to finance the purchase of a deepwater dive support vessel, Deep Discoverer (the “Vessel”) for the full transaction price of $116.8 million. The sale-leaseback agreement (“Charter”) was entered into with a French joint-stock company, owned by Credit Industrial et Commercial (“CIC”) which was formed for the sole purpose to purchase and act as the lessor of the Vessel. It is a variable interest entity, which is fully consolidated in our consolidated financial statements. The transaction was funded through debt of $96.2 million and will expire on January 8, 2031.

Foreign committed credit -We have committed credit lines at many of our international subsidiaries for immaterial amounts. We utilize these facilities for asset financing and to provide a more efficient daily source of liquidity. The effective interest rates depend upon the local national market.

NOTE 17. STOCKHOLDERS’ EQUITY

On July 26, 2023, the Company announced that its Board of Directors authorized the initiation of a quarterly cash dividend of $0.05 per share and represents $0.20 per share on an annualized basis. The cash dividends paid during the years ended December 31, 2024, 2023 and 2022 were $85.9 million, $43.5 million andnil, respectively.

As an English public limited company, we are required under U.K. law to have available “distributable reserves” to conduct share repurchases or pay dividends to shareholders. Distributable reserves are a statutory requirement and are not linked to a GAAP reported amount (e.g., retained earnings). The declaration and payment of dividends require the authorization of our Board of Directors, provided that such dividends on issued share capital may be paid only out of our “distributable reserves” on our statutory balance sheet. Therefore, we are not permitted to pay dividends out of share capital, which includes share premium.

The following is a summary of our capital stock activity for the years ended December 31, 2024, 2023, and 2022:

In July 2022, the Board of Directors authorized the repurchase of up to $400.0 million of our outstanding ordinary shares under our share repurchase program. On July 26, 2023 and October 23, 2024, the Board of Directors authorized additional share repurchases of up to $400.0 million and $1.0 billion, respectively, and the Company’s total share repurchase authorization was increased to $1.8 billion of our outstanding ordinary shares under our share repurchase program. Pursuant to this share repurchase program, we repurchased $400.1 million, $205.1 million and $100.3 million of ordinary shares during the year ended December 31, 2024, 2023 and 2022.

Based upon the remaining repurchase authority of $1.1 billion and the closing stock price as of December 31, 2024, approximately 37.8 million ordinary shares could be subject to repurchase. Since the initial share repurchase authorization in July 2022, we have purchased an aggregate amount of $705.5 million of ordinary shares through December 31, 2024. All repurchased shares were immediately cancelled.

Accumulated other comprehensive income (loss)consisted of the following:

Reclassifications out of accumulated other comprehensive income (loss)consisted of the following:

(a) These accumulated other comprehensive income components are included in the computation of net periodic pension cost (See Note 22 for further details).

NOTE 18. SHARE-BASED COMPENSATION

Under the Amended and Restated TechnipFMC plc Incentive Award Plan (the “2017 Plan”), we were able to grant certain incentives and awards to our officers, employees, non-employee directors, and consultants of the Company and its subsidiaries. Awards included share options, share appreciation rights, performance stock units, restricted stock units, restricted shares, or other awards authorized under the 2017 Plan. On April 28, 2022, we adopted the TechnipFMC plc 2022 Incentive Award Plan (the “Plan”), which replaces the 2017 Plan. Under the Plan,8.9 million ordinary shares were authorized for awards, and the remaining available shares from the 2017 Plan were added to the authorized amount under the Plan.

The exercise price for options is determined by the Committee but cannot be less than the fair market value of our ordinary shares at the grant date. For restricted share units issued on or after January 1, 2023, the vesting schedule of restricted share unit grants changed from athree-year cliff to athree-year ratable schedule, with grants vesting in three equal installments over three years on the anniversary of the grant date. Performance share unit grants generally vest after three years of service.

Under the Plan, our Board of Directors has the authority to grant non-employee directors share options, restricted shares, restricted share units, and performance shares. Unless otherwise determined by our Board of Directors, awards to non-employee directors generally vestone year from the date of grant. All restricted share units awarded prior to 2020 will be settled when a non-executive director ceases services on the Board of Directors. Beginning with the 2020 equity award, non-executive directors now have the opportunity to elect the year in which they will take receipt of the equity grants from either (a) a period ofone to 10 years from the grant date or (b) upon their separation from Board service. The elections are made prior to the beginning of the grant year and are irrevocable after December 31 of the year prior to grant. Restricted share units are settled when a director ceases services to the Board of Directors. As of December 31, 2024, outstanding awards to active and retired non-employee directors included 75.0 thousand of restricted share units.

The measurement of share-based compensation expense on restricted share awards is based on the market price and fair value at the grant date and the number of shares awarded. The fair value of performance shares is estimated using a combination of the closing stock price on the grant date and the Monte Carlo simulation model. We use the Black-Scholes options pricing model to measure the fair value of stock options granted on or after January 1, 2017.

The share-based compensation expense for each award is recognized ratably over the applicable service period or the period beginning at the start of the service period and ending when an employee becomes eligible for retirement (currently age 62 under the Plan), after taking into account estimated forfeitures.

We recognize compensation expense and the corresponding tax benefits for awards under the Plan. The compensation expense under the Plan for continuing operations was as follows:

As of December 31, 2024, the portion of share-based compensation expense related to outstanding awards to be recognized in future periods is as follows:

Restricted Share Units

A summary of the non-vested restricted share units’ activity is as follows:

The weighted-average grant-date fair value of restricted stock share units granted during the years ended December 31, 2024, 2023, and 2022 was $19.99, $14.06 and $7.89, respectively.

Performance Share Units

The Board of Directors has granted certain employees, senior executives and directors performance share units that vest subject to achieving satisfactory performances. The number of shares earned is determined at the end of each performance period based on the Company’s achievement of certain predefined targets as described in the underlying performance share unit agreement. In the event the Company exceeds the predefined target, shares for up to a maximum of 200% of the target award may be awarded. In the event the Company falls below the predefined target, a reduced number of shares may be awarded. If the Company falls below the threshold award performance level, no shares will be awarded. As of December 31, 2024,4.3 million performance share units were outstanding assuming the achievement of 100% of target. For performance share units issued on or after January 1, 2022, performance is based on results of return on invested capital (50%) and total shareholder return (“TSR”) (50%).

For the performance share units which vest based on TSR, the fair value of performance shares is estimated using a combination of the closing stock price on the grant date and the Monte Carlo simulation model. The weighted-average fair value and the assumptions used to measure the fair value of performance share units subject to performance-adjusted vesting conditions in the Monte Carlo simulation model were as follows:

(a) The weighted-average fair value was based on performance share units granted during the period.

(b) Expected volatility is based on normalized historical volatility of our shares over a preceding period commensurate with the expected term of the performance share units.

(c) The risk-free rate for the expected term of the performance share units is based on the U.S. Treasury yield curve in effect at the time of grant.

(d) For awards subject to service-based vesting, due to the lack of historical exercise and post-vesting termination patterns of the post-Merger employee base, the expected term was estimated using a simplified method for all awards granted in 2024, 2023, and 2022.

A summary of the non-vested performance share units’ activity is as follows:

The weighted-average grant-date fair value of performance share units granted during the years ended December 31, 2024, 2023, and 2022 was $24.39, $17.86 and $11.10.

Share Option Awards

The fair value of each share option award is estimated as of the date of grant using the Black-Scholes options pricing model.

Share options awarded prior to 2017 were granted subject to performance criteria based upon certain targets, such as TSR, return on capital employed, and operating income from recurring activities. Subsequent share options granted are time-based awards vesting over three years.

There wereno share option awards granted in 2024, 2023 and 2022.

The following is a summary of share option transactions during the year ended December 31, 2024:

The aggregate intrinsic value of stock options outstanding and stock options exercisable as of December 31, 2024 and December 31, 2023 was $9.1 million and $1.4 million respectively.

Cash received from the share option exercises was $32.2 million, $1.1 million andnil during each of the years ended December 31, 2024, 2023, and 2022, respectively. The total intrinsic value of share options exercised during each of the years ended December 31, 2024, 2023, and 2022 was $2.1 million, $0.3 million andnil. To exercise share options, an employee may choose (1) to pay, either directly or by way of the group savings plan, the share option strike price to obtain shares, or (2) to sell the shares immediately after having exercised the share option (in this case, the employee does not pay the strike price but instead receives the intrinsic value of the share options in cash).

The following summarizes significant ranges of outstanding and exercisable share options as of December 31, 2024:

NOTE 19. SUPPLIER FINANCE PROGRAM OBLIGATIONS

We facilitate a supply chain finance program (“SCF”) that is administered by a third-party financial institution, which allows qualifying suppliers to sell their receivables from the Company to the SCF bank. These participating suppliers negotiate their outstanding receivable(s) directly with the SCF bank. We are not a party to those agreements and the terms of our payment obligations are not impacted by a supplier’s participation in the SCF. We agree to pay the SCF bank based on the original invoice amounts and maturity dates as consistent with our accounts payables.

All outstanding amounts related to suppliers participating in the SCF are recorded within accounts payable, trade in our consolidated balance sheets, and the associated payments are included in operating activities within our consolidated statements of cash flows. As of December 31, 2024 the amounts due to suppliers participating in the SCF were as follows:

NOTE 20. COMMITMENTS AND CONTINGENT LIABILITIES

Contingent liabilities associated with guarantees - In the ordinary course of business, we enter into standby letters of credit, performance bonds, surety bonds, and other guarantees with financial institutions for the benefit of our customers, vendors, and other parties. The majority of these financial instruments expire within five years. Management does not expect any of these financial instruments to result in losses that would have a material adverse effect on our consolidated financial position, results of operations, or cash flows.

Guarantees made by our consolidated subsidiaries consisted of the following:

(a)Financial guarantees represent contracts that contingently require a guarantor to make payments to a guaranteed party based on changes in an underlying agreement that is related to an asset, a liability, or an equity security of the guaranteed party. These tend to be drawn down only if there is a failure to fulfill our financial obligations.

(b)Performance guarantees represent contracts that contingently require a guarantor to make payments to a guaranteed party based on another entity's failure to perform under a non-financial obligating agreement. Events that trigger payment are performance-related, such as failure to ship a product or provide a service.

We believe the ultimate resolution of our known contingencies will not materially adversely affect our consolidated financial position, results of operations, or cash flows.

Contingent liabilities associated with legal and tax matters - We are involved in various pending or potential legal and tax actions or disputes in the ordinary course of our business. These actions and disputes can involve our agents, suppliers, clients, and venture partners, and can include claims related to payment of fees, service quality, and ownership arrangements, including certain put or call options. We are unable to predict the ultimate outcome of these actions because of their inherent uncertainty. However, we believe that the most probable, ultimate resolution of these matters will not have a material adverse effect on our consolidated financial position, results of operations, or cash flows.

As previously disclosed, we have also resolved an anti-corruption investigation by French authorities (the Parquet National Financier (“PNF”)). On June 22, 2023, the Company, through its subsidiary Technip UK Limited, along with Technip Energies SAS, a subsidiary of Technip Energies NV, reached a resolution with the PNF of all outstanding matters, including its investigations into historical projects in Equatorial Guinea, Ghana, and Angola. The resolution took the form of a convention judiciaire d'interet public, (“CJIP”), which does not involve any admission of liability or guilt.

Under the terms of the CJIP, Technip UK and Technip Energies France will pay a public interest fine of €154.8 million and €54.1 million, respectively, for a total of €208.9 million. Under the companies’ separation agreements, TechnipFMC is responsible for €179.45 million to be paid in installments through July 2024, and Technip Energies is responsible for the remaining €29.45 million. During the three-months ended June 30, 2023, we recorded an incremental liability of $126.5 million. After making all scheduled installment payments of €24.7 million, €51.6 million, €51.6 million, and €51.6 million on July 13, 2023, January 15, 2024, April 8, 2024, and July 10, 2024, respectively, we haveno further outstanding balance as of December 31, 2024.

TechnipFMC fully cooperated with the PNF and was not required to retain a monitor. The CJIP received final approval by the President of the Tribunal Judiciaire of Paris at a hearing on June 28, 2023.

All obligations to PNF related to the enforcement matters in Equatorial Guinea, Ghana, and Angola have been completed and the Company has been unconditionally released by PNF.

Contingent liabilities associated with liquidated damages - Some of our contracts contain provisions that require us to pay liquidated damages if we are responsible for the failure to meet specified contractual milestone dates and the applicable customer asserts a conforming claim under these provisions. These contracts define the conditions under which our customers may make claims against us for liquidated damages. Based upon the evaluation of our performance and other commercial and legal analysis, management believes we have appropriately recognized probable liquidated damages as of December 31, 2024 and 2023, and that the ultimate resolution of such matters will not materially affect our consolidated financial position, results of operations, or cash flows.

NOTE 21. INCOME TAXES

Components of income before income taxes -U.S. and outside U.S. components of income before income taxes were as follows:

Provision for income tax -The provision for income taxes consisted of:

Deferred tax assets and liabilities -Significant components of deferred tax assets and liabilities were as follows:

Valuation Allowance. We continue to assess the realizability of deferred tax assets at each balance sheet date across all jurisdictions in which we operate. The change in our deferred tax asset valuation allowance position in 2024 primarily related to $194.9 million release of valuation allowance on certain tax attributes in the U.S., primarily foreign tax credits carryforward and net operating loss carryforwards. In reaching this determination, the Company considered the growing trend of profitability over the last three years in the United States, as well as expectations regarding the generation of future taxable income and the sources of future taxable income. We also established a valuation allowance in Brazil for one of our operating entities. The establishment of the new valuation allowance in the Brazil entity resulted in additional income tax expense of $23.2 million and additional tax expense recognized within other comprehensive loss of $40.7 million for the year ended December 31, 2024. The net balance of the deferred tax asset valuation allowance is recorded in jurisdictions where we have cumulative losses or the realizability of tax attributes is not certain.

Non-deductible interest. At December 31, 2024, deferred tax assets include tax benefits related to certain intercompany interest costs. If not utilized, these deferred tax assets will begin to expire beginning in 2025. Management believes that it is more likely than not that we will not be able to deduct these costs before expiration of the carry forward period; therefore, we continue to maintain a valuation allowance against the related deferred tax assets.

Foreign tax credit carryforwards. At December 31, 2024, deferred tax assets included U.S. foreign tax credit carryforwards of $107.7 million, which, if not utilized, will begin to expire in 2026. Realization of these deferred tax assets is dependent on the generation of sufficient U.S. taxable income prior to the above date. In 2024, management reassessed the realizability of the foreign tax credit carryforwards and, based on current and future forecasts of U.S. operating results and U.S. taxable income, management believes that it is now more likely than not that the majority of our foreign tax credits will be utilized prior to expiration. We have retained a valuation allowance of $28.7 million on the U.S. foreign tax credits that we believe we will be unable to utilize. In its analysis, management has considered the effect of deemed dividends and other expected adjustments to U.S. earnings that are required in determining U.S. taxable income.

Net operating loss carryforwards. At December 31, 2024, we had $338.4 million of tax-effected net operating loss carryforwards, with approximately $57.7 million estimated to be utilized against our unrecognized tax benefits. The ultimate realization of these deferred tax assets depends on our ability to generate sufficient taxable income in the appropriate taxing jurisdiction. Our deferred tax assets from net operating losses will expire as follows:

Unrecognized tax benefits -The following table presents a summary of changes in our unrecognized tax benefits:

The amounts reported above for uncertain tax positions excludes interest and penalties of $14.3 million, $2.8 million, and $1.1 million for the years ended December 31, 2024, 2023, and 2022, respectively. Interest and penalties relating to these uncertain tax positions were included in income tax expense in our consolidated statements of income. It is reasonably possible that within twelve months,$13.8 million of assets for unrecognized tax benefits will be settled. This amount is reflected inincome taxes payable; the remaining balance of the unrecognized tax benefit is recorded in other long-term liabilities or netted with the deferred balance expected to settle the liability. As of December 31, 2024, a net $61.3 million unrecognized tax benefit, without a net operating loss carryforward or other deferred tax asset to offset, would positively impact the effective tax rate and be recognized as additional tax benefits in our statement of operations if resolved in our favor.

We operate in numerous jurisdictions around the world and could be subject to multiple tax audits at any given time. Most notably, the following tax years and thereafter remain subject to examination: 2020 for Norway, 2020 for Portugal, 2021 for United States, 2022 for France, 2018 for Malaysia, and 2023 for United Kingdom.

TechnipFMC plc is a public limited company incorporated under the laws of England and Wales. Therefore, our earnings are subject to the U.K. statutory rate which is 25.0% effective April 2023, and 19.0% for 2022.

Effective income tax rate reconciliation -The effective income tax rate was different from the statutory U.K. income tax rate due to the following:

(1) In 2024 our effective tax rate had a (21.9)% benefit related to changes in valuation allowances. This primarily was relatedto the release of a valuation allowance in the United States with a positive tax benefit of$194.9 million, partially offset by an increase of valuation allowance in Brazil of $23.2 million and other net changes in the valuation allowance assessment. The 2024 rate was also impacted by utilization of tax credits in multiple jurisdictions, partially offset by the change in geographical profit mix year-over-year and tax adjustments related to the reassessment of prior year tax accruals.

(2) In 2023 our effective tax rate had a (53.1)% benefit related to changes in valuation allowances. This primarily was related to the release of a valuation allowance in Brazil based on the weight of positive evidence demonstrating the ability to realize its deferred tax assets, which are primarily indefinite-lived net operating losses. Our effective tax rate also showed an expense of 34.2% related to adjustments to 2022 taxes. This amount included expenses associated with expiring tax attributes. These tax attributes were fully valued, and the valuation allowance movement and attributed expirations are shown gross in the effective tax rate table above. The expiration did not have a net impact on tax expense.

Income tax holidays. We did not benefit from income tax holidays in 2024.

NOTE 22. PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS

We have funded and unfunded defined benefit pension plans, which provide defined benefits based on years of service and final average salary.

On December 31, 2017, we amended the U.S. retirement plans (the “Plans”) to freeze benefit accruals for all participants of the Plans as of December 31, 2017. After that date, participants in the Plans will no longer accrue any further benefits and participants’ benefits under the Plans will be determined based on credited service and eligible earnings as of December 31, 2017.

Foreign-based employees are eligible to participate in TechnipFMC-sponsored or government-sponsored benefit plans to which we contribute. Several of the foreign defined benefit pension plans sponsored by us provide for employee contributions; the remaining plans are noncontributory. The most significant of these plans are in the Netherlands, France, and the United Kingdom.

During 2024, two of the U.K. pension plans entered into buy-in contracts for all their members. Under the buy-in contract terms, the responsibility to pay pension benefits still rests with the plans and the obligation is still recorded by the Company. We have elected to continue to measure the pension obligation using our traditional discount rate and mortality assumptions.

We have other post-retirement benefit plans covering substantially all of our U.S. unionized employees. The post-retirement health care plans are contributory; the post-retirement life insurance plans are noncontributory.

We are required to recognize the funded status of defined benefit post-retirement plans as an asset or liability in the consolidated balance sheet and recognize changes in that funded status in comprehensive income (loss) in the year in which the changes occur. Further, we are required to measure the plan’s assets and its obligations that determine its funded status as of the date of the consolidated balance sheet. We have applied this guidance to our domestic pension and other post-retirement benefit plans as well as for many of our non-U.S. plans, including those in the United Kingdom, Germany, France, and Canada. Pension expense measured in compliance with GAAP for the other non-U.S. pension plans is not materially different from the locally reported pension expense.

We also continue to monitor pension legal requirements that are applicable to our business. For instance, in July 2024, the U.K. Court of Appeal upheld a ruling of the U.K. High Court in Virgin Media Ltd v. NTL Pension Trustees II Ltd case, a matter that we were not a party to or involved in. The court ruled that certain historical amendments purportedly made to Virgin Media’s U.K. defined benefit plan were legally invalid because they had not been accompanied by necessary actuarial confirmation. We are currently monitoring legislation intervention and further guidance on the application of the ruling to assess whether this decision has any implications for our U.K. plans.

The funded status of our U.S. pension plans, international pension plans and U.S. post-retirement health care and life insurance benefit plans, together with the associated balances recognized in our consolidated balance sheets as of December 31, 2024 and 2023, were as follows:

(a)Actuarial gains for our U.S. and international pension plans in 2024 primarily reflect increases in discount rates from December 31, 2023 to December 31, 2024.

(a)Includes non current pension asset of $47.6 million as of December 31, 2024, primarily related to buy-in insurance contracts for international plans

The following table summarizes the pre-tax amounts in accumulated other comprehensive (income) loss as of December 31, 2024 and 2023 that have not been recognized as components of net periodic benefit cost:

The following tables summarize the projected and accumulated benefit obligations and fair values of plan assets where the projected or accumulated benefit obligation exceeds the fair value of plan assets as of December 31, 2024 and 2023:

The following table summarizes the components of net periodic benefit cost (income) for the years ended December 31, 2024, 2023, and 2022:

The following table summarizes changes in plan assets and benefit obligations recognized in other comprehensive income (loss) for the years ended December 31, 2024, 2023, and 2022:

Key assumptions -The following weighted-average assumptions were used to determine the benefit obligations:

The following weighted-average assumptions were used to determine net periodic benefit cost:

Our estimate of expected rate of return on plan assets is based on the historical performance of plan assets, current market conditions, our asset allocation, and long-term growth expectations.

Plan assets -We actively monitor how the duration, and the expected yield of the investments are matching the expected cash outflows arising from the pension obligations. We have not changed the processes used to manage its risks from previous periods. Investments are well diversified, such that the failure of any single investment would not have a material impact on the overall level of assets. Our pension investment strategy emphasizes maximizing returns consistent with balancing risk. Excluding our international plans with insurance-based investments,64.1% of our total pension plan assets are primarily represented by the U.S. qualified plan. These plans are primarily invested in hedge funds to maximize the long-term returns of the plans. The investment managers of these assets, including the hedge funds and limited partnerships, use Graham and Dodd fundamental investment analysis to select securities that have a margin of safety between the price of the security and the estimated value of the security. This value-oriented approach tends to mitigate the risk of a large equity allocation.

The following is a description of the valuation methodologies used for the pension plan assets.

•Cash and cash equivalents are valued at cost, which approximates fair value.

•Current receivables are valued at cost, which approximates at fair value.

•Equity securities are comprised of common stock and preferred stock. The fair values of equity securities are valued at the closing price reported on the active market on which the securities are traded.

•Fair values of registered investment companies and common/collective trusts are valued based on quoted market prices, which represent the net asset value (“NAV”) of shares held. Registered investment companies include investments in emerging market bonds. Common/collective trusts primarily includes money market instruments with short maturities.

•Buy-in insurance contracts are valued using actuarial assumptions and techniques as there is little market data available.

•The fair values of hedge funds are valued using the NAV as determined by the administrator or custodian of the fund. The funds primarily invest in U.S. and international equities, debt securities, and other hedge funds.

•The fair values of limited partnerships are valued using the NAV as determined by the administrator or custodian of the fund. The partnerships primarily invest in U.S. and international equities and debt securities.

•Real estate and other investments consist of real estate investment trusts and other investments. These investments are measured at quoted market prices, which represent the NAV of the securities held in such funds at year end.

Our pension plan assets measured at fair value on a recurring basis are as follows as of December 31, 2024 and 2023. Refer to “Fair value measurements” in Note 1 to these consolidated financial statements for a description of the levels.

(a)Certain investments that are measured at fair value using net asset value per share (or its equivalent) have not been classified in the fair value hierarchy.

The following table summarizes our Level 3 rollforward for our buy-in insurance contracts for the year ended December 31, 2024:

Contributions -We expect to contribute approximately $11.1 million to our US Qualified Pension Plan in 2025. In 2024 and 2023, we contributed $17.9 million and $5.7 million to all pension plans, respectively.

Estimated future benefit payments -The following table summarizes expected benefit payments from our various pension and post-retirement benefit plans through 2034. Actual benefit payments may differ from expected benefit payments.

Savings plans -The TechnipFMC Retirement Savings Plan (“Qualified Plan”), a qualified salary reduction plan under Section 401(k) of the Internal Revenue Code, is a defined contribution plan. Additionally, we have a non-qualified deferred compensation plan, the (“Non-Qualified Plan”), which allows certain highly compensated employees the option to defer the receipt of a portion of their salary. We match a portion of the participants’ deferrals to both plans. Both plans relate to FMC Technologies, Inc.

Participants in the Non-Qualified Plan earn a return based on hypothetical investments in the same options as our 401(k) plan. Changes in the market value of these participant investments are reflected as an adjustment to the deferred compensation liability with an offset to other income (expense), net. As of December 31, 2024 and 2023, our liability for the Non-Qualified Plan was $26.1 million and $23.0 million, respectively, and was recorded in other liabilities in our consolidated balance sheets. We hedge the financial impact of changes in the participants’ hypothetical investments by purchasing the investments that the participants have chosen. Changes in the fair value of these investments are recognized as an offset to other income (expense), net in our consolidated statements of income. As of December 31, 2024 and 2023, we had investments for the Non-Qualified Plan totaling $26.1 million and $23.0 million at fair market value, respectively.

During the years ended December 31, 2024 and 2023 we recognized expense of $21.1 million and $21.1 million, respectively, for matching contributions to these plans in 2024 and 2023, respectively. Additionally, during the years ended December 31, 2024 and 2023, we recognized expense of $8.8 million and $4.4 million, respectively, for non-elective contributions.