MODEC, INC.
6269・Prime Market・Machinery
Business
Mitsui O.S.K. Lines... wait, MODEC, Inc. is a single-segment company that provides total solutions across the value chain—from engineering, procurement, construction, and installation (EPCI) of floating offshore oil and gas production facilities such as FPSOs (Floating Production, Storage and Offloading), FSOs, and TLPs, to charter services (lease + operation) and after-sales service. Its major customers are leading global oil and gas developers such as ExxonMobil, Shell, Equinor, and Petrobras, and it operates globally, focusing on ultra-deepwater and deepwater oilfield development projects in Brazil, Guyana, West Africa, Southeast Asia, and other regions. As a fabless project management company without its own factories or shipyards, it utilizes shipyards and specialized contractors around the world, and strengthens its business foundation through strategic partnerships with Mitsui O.S.K. Lines and Mitsui & Co.
Business Model
Revenue is composed mainly of two pillars: ① revenue recognized in line with construction progress on EPCI projects such as FPSOs, and ② recurring revenue from long-term charter and operation contracts after completion. In EPCI projects, working capital burden is minimized through collection of advance payments in line with construction progress. In charter projects, project finance is arranged through joint venture SPCs with partners such as Mitsui O.S.K. Lines and Mitsui & Co., adopting a structure that diversifies the company's own capital burden and risk. In FY2025, revenue reached US$4,581,232 thousand (up 9.4% year on year), and operating income reached US$437,607 thousand (up 35.5% year on year).
Company Strengths
In FY2025, the company won consecutive orders for the Gato do Mato (Orca) FPSO for Shell Brasil and the Hammerhead FPSO for ExxonMobil Guyana, bringing order intake to US$9,263,552 thousand (up 646.6% year on year). The order backlog reached a record-high level of US$18,588,729 thousand (up 43.6% year on year), providing extremely high visibility into medium- to long-term revenue and profit.
As a fabless company that does not own its own factories or shipyards, the company keeps fixed costs low by specializing in project management. In EPCI projects, working capital burden is minimized through the collection of advance payments, while in charter projects, risk is diversified through the use of project finance and joint-venture SPCs. The FY2025 operating margin reached approximately 9.6% (US$437,607 thousand ÷ US$4,581,232 thousand).
The company has had a business alliance agreement with Mitsui & Co. since 2010 and with Mitsui O.S.K. Lines since 2023, building a framework for mutual utilization of management resources, know-how, and customer bases. In August 2024, Mitsui O.S.K. Lines became the largest shareholder. Both companies also function as joint-venture partners in the FPSO charter business, contributing to strengthened fundraising capability and customer development capability.
ENVALITH's Perspective
Performance Trend
Q1 FY2026 (yen-converted) results showed revenue of ¥172,224 million (up 31.9% year on year), operating profit of ¥19,626 million (up 74.5% year on year), and quarterly profit attributable to owners of the parent of ¥15,853 million (up 90.6% year on year), achieving substantial increases in both revenue and profit. The main driver was steady progress on FPSO construction projects. As an external factor, the sharp rise in crude oil prices (over US$80–100 per barrel) driven by heightened tensions in the Middle East supported oil companies' investment in deepwater oil and gas field development. The full-year forecast for FY2026 (ending March 2026) remains unrevised at revenue of ¥720,038 million (up 0.4% year on year), operating profit of ¥72,003 million (up 5.1% year on year), and profit attributable to owners of the parent of ¥57,916 million (up 2.6% year on year). Operating cash flow improved substantially year on year to US$670,788 thousand, and cash and cash equivalents increased to US$1,961,484 thousand.
Growth Strategy
Strengthening the profitability of the core FPSO business while pursuing decarbonization and new business development in parallel
By completing and delivering multiple large-scale FPSO construction projects included in the order backlog of 17,859,461 thousand US dollars on schedule, the company aims to ensure the recognition of revenue and profit over the medium to long term. The 31.9% year-on-year increase in revenue in the first quarter of FY2026 (ending March 2026) demonstrates steady progress on this strategy.
By concentrating management resources on ultra-deepwater, large-scale FPSO projects in which major oil companies continue to invest, the company aims to secure orders for new large-scale projects based on its track record and technological capabilities. Amid the continuing need to maintain stable energy supply alongside the trend toward decarbonization, demand for deepwater oil and gas field development, which offers superior cost competitiveness, remains robust.
In preparation for the long-term risk of declining fossil fuel demand, the company is promoting the development of new decarbonization-related businesses such as floating offshore wind turbines (FOWT). At present, these are still at a stage requiring further time before practical application and commercialization, and their development continues to be pursued in parallel with the core FPSO business.
Last updated: July 17, 2026