Italian multinational Saipem released a profit warning this week, revoking its previously positive outlook from October last year in what it says has been a “significant deterioration” in profit margins as a result of the pandemic’s ongoing impacts and higher raw material costs.  

As compared to its October outlook, the group’s “contraction of consolidated revenues” for the second half of 2021 was reduced from €4.5bn to €3.5bn, with statutory financial statements from 2021 anticipated to show a loss of more than a third of the company’s equity.  

In addition, initial estimations found consolidated adjusted core earnings for the second half of 2021 were down by around €1bn compared to the figure given in the October findings.  

The company’s board of directors met over the weekend to discuss the findings and, in a statement on the matter, Saipem said that it had entered talks with main shareholders Eni and state lender CDP to consider support for “an appropriate and timely financing package”.  

The shareholders responded by saying that they were “carefully monitoring” the situation and would carry out assessments together.  

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

Talks have also been entered with banks to discuss the potential impacts of these losses on Saipem’s outstanding loan agreements.  

The news follows what seemed like a promising start to the year for the group, with Saipem receiving offshore contracts in Australia and Guyana worth $1.1bn in the first few weeks of January, as well as an agreement with Tenaris for a carbon capture project in Italy.  

However, Saipem’s struggle to rebound from the pandemic’s impact on oil and gas demand has put its plans to expand into green technologies – such as offshore wind, carbon capture, and hydrogen – into doubt. 

Exact results from the financial review are still pending, however once they are confirmed the board of directors says it will call a shareholders’ meeting and take “the appropriate measures according to law”.