Hit by lower revenues, Saipem slips into the red

Affected by lower revenues, Italian offshore contractor Saipem sank to a loss during the first quarter of the year. 

In its financial report on Tuesday, Saipem said its revenues were down by 15.4% during the first quarter of the year, amounting to €1.9 billion, compared to €2.26 billion in the prior-year quarter.

The decrease was due to a contraction in the Offshore and Onshore E&C sectors, as well as in the Offshore Drilling sector.

Furthermore, the company booked a loss of €2 million in the first quarter of the year compared to a profit of €47 million in the same period last year.

Stefano Cao, Saipem CEO, commented: “The results for the first quarter of 2018 confirm the solid operational and managerial performance previously demonstrated during 2017 and highlight a further reduction of net debt compared to the level recorded at year-end 2017.

“Furthermore, last March, with a view to further strengthening Saipem’s capabilities in the subsea pipelaying sector and completing the range of services offered to the subsea market, the company finalized the agreement for the purchase of the ship Constellation, a latest generation vessel equipped with cutting edge technology.”

According to the company, the acquisition of the ultra-deepwater pipelay and construction vessel Constellation from Emas Offshore will be finalized in the second quarter of 2018.

The Italian company’s capital expenditures in 1Q 2018 were €32 million versus €83 million in the first quarter of 2017.

Saipem’s net debt at the end of March amounted to €1.2 billion, a €96 million reduction compared to December 31, 2017 and debt of €1.296 billion.

When it comes to new contracts, during the first quarter of 2018 Saipem landed €1.023 billion in new work versus €509 million in the first quarter of 2017.

Backlog at the end of March 2018 was  €11.5 billion compared to €12.39 billion at December 31, 2017. Out of this backlog, €4.04 billion was in Offshore Engineering & Construction business, €5.85 billion in Onshore Engineering & Construction, €856 million in Offshore Drilling and €758 in Onshore Drilling. About €4.8 billion will be realized in 2018.

Saipem’s revenues guidance for 2018 is approximately €8 billion, capital expenditure guidance is about €0.5 billion and net debt €1.3 billion.

Offshore Energy Today Staff