saipem

Saipem S.p.A. is a leading Italian multinational corporation specializing in engineering, procurement, construction, and drilling services for the energy and infrastructure sectors. Established in 1957, the company has evolved into a global entity with operations spanning over 50 countries and employing approximately 30,000 individuals.

Company Overview

Saipem's core competencies encompass both offshore and onshore projects, including the design and construction of complex infrastructures and plants. The company's business lines are diversified into six segments: Drilling, Asset-Based Services, Energy Carriers, Offshore Wind, Sustainable Infrastructures, and Robotics & Industrialized Solutions. This diversification aligns with Saipem's vision of "Engineering for a sustainable future," emphasizing its commitment to supporting clients in the transition to net-zero emissions through innovative and sustainable solutions.

Financial Performance

In 2024, Saipem reported revenues of approximately €14.55 billion, with a gross profit of €1.33 billion and a net income of €306 million. The company's market capitalization stood at €4.1 billion as of August 2024. These figures reflect a robust financial position, underscored by a record order intake that increased its backlog to an all-time high of €34 billion.

Strategic Developments

In February 2025, Saipem announced a merger with Norwegian competitor Subsea 7, forming a new entity named Saipem7. This strategic move aims to create a leading European provider of onshore and offshore energy services, boasting a combined order backlog of €43 billion and annual revenues of approximately €20 billion. The merger is expected to generate annual cost savings of around €300 million by the third year post-completion through fleet optimization and unified procurement, sales, and marketing operations.

Additionally, Saipem reinstated dividend payments in 2025 after a four-year hiatus, planning to distribute €333 million in dividends this year and at least another €300 million in 2026. The company also committed to reducing gross debt by approximately €650 million by repaying all maturities due between 2025 and 2027, aiming to improve its credit rating to investment grade.

Market Position and Competitors

Saipem operates in a highly competitive environment, facing challenges from both large, established corporations and smaller, specialized firms. Key competitors include Subsea 7, McDermott International, TechnipFMC, KBR, Wood Group, Halliburton, National Oilwell Varco, Schlumberger, Baker Hughes, and Fluor Corporation. The company's proven track record of executing large-scale and complex projects, along with its commitment to sustainability and innovation, positions it favorably within the industry.

Opportunities and Challenges

Saipem is actively expanding into low-carbon sectors, focusing on green ammonia and offshore wind projects. In July 2024, the company was awarded a €250 million project to construct a large-scale green ammonia storage tank in Northern Europe, marking its entry into the renewable hydrogen market. Saipem also aims to enter the offshore wind market in Italy, emphasizing the importance of developing this sector domestically.

However, the company faces challenges such as potential reductions in orders from key clients like Saudi Aramco, which announced a halt to its oil capacity expansion plans. Saipem anticipates a 20% drop in average annual orders from Aramco until 2027 but has incorporated this expectation into its medium-term strategy, aiming to mitigate the impact through diversification and strategic planning.