Saipem sees profit decline amid Algeria probe

Saipem700024 April 2013, London – Italian oil services firm, Saipem, says it was on course for a first-quarter results, which included net profits of €110 million ($143 million) on revenue of €3.08 billion.
This represents a over 52% drop from last year, when the company saw €231 million in profits on €3.13 billion revenue.

The Italian company is currently under a corruption probe from the Milan prosector’s office, which led to the resignation of chief executive officer, Pietro Franco Tali, in December.

The investigation could cost the company as much as €500 million ($650 million), Reuters quoted chief executive officer, Umberto Vergine as telling analysts.

“We are having some difficulties to get recent payments and the worst-case scenario is we won’t get these payments,” Vergine said.

Despite clinching $500 million in new South American contracts, the value of new work booked declined to €2.88 billion in the quarter from €3.11 billion in the 2012 quarter.

Net debt increased €567 million euros to €4.84 billion on account of investments, invoice negotiations and financially challenging projects, among other things, the company said.

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