Saipem Sees Tough Year Ahead After 2017 Guidance Miss
MILAN, March 6 (Reuters) - Italian oil services group Saipem said on Tuesday it expected a difficult year ahead after sales and profit last year fell short of its guidance due to weak order books.
Saipem, jointly controlled by oil major Eni and state lender Cassa Depositi e Prestiti, said it expected sales this year to be around 8 billion euros ($10 billion), compared with 9 billion euros in 2017.
The recent uptick in oil prices has not yet prompted the majors to speed up investments despite a few timid signs of recovery in some segments, the company said.
Oil contractors in recent years have been struggling to fill order books after majors deferred projects and cut billions of dollars in costs to offset subdued crude prices.
Saipem said adjusted net profit last year fell 80 percent from 2016 to 46 million euros. That was below company guidance of around 200 million euros.
The adjustment strips out writedowns and restructuring and tax charges which resulted in a reported net loss of 328 million euros for the full year.
In the fourth quarter, the company posted an adjusted net loss of 105 million euros
Its order backlog fell about 13 percent last year to 12.4 billion euros though performance in the second half of the year was stable.
"Despite the persistence of a challenging market context ... (there was) a constant downward trend in net debt and a good intake of new contracts, above all in the second half of the year," CEO Stefano Cao said.
($1 = 0.8106 euros) (Reporting by Stephen Jewkes Editing by Valentina Za and Mark Potter)
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