Italian services giant Saipem has revealed a four-year strategic plan, starting with the rationalisation of assets and the streamlining of operations as it seeks to support its traditional customers and the energy transition.

The company outlined the main points of the strategy for 2022-2025 in detail, saying it has already begun the rationalisation of assets, pointing to the gradual closure of three yards around the world and the disposal of five ships.

Streamlining of the operating model is underway with the rationalisation of three global engineering hubs, as well as the reduction of overhead costs with the closure of 14 non-strategic offices abroad.

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The plan aims to reduce the overall cost base by around €100 million ($116 million) in 2022, rising to around €300 million per year when fully operational in 2025.

Revenues are forecast to grow at an average annual rate of 15% until 2025, thanks to a backlog of €24.5 billion, new commercial opportunities and growth prospects for the drilling segment.

Next year will be a year of transition in which revenues and margins are expected to grow thanks to the contribution of offshore activities and drilling, where signs of recovery are already visible.

In 2023, adjusted Ebitda is forecast to return to pre-Covid-19 levels to reach double-digit margins in the second part of the plan.

Cumulative investments of about €1.5 billion are expected over the plan period, including more than €200 million for technology.

Net financial debt next year is predicted to grow to €2.2 billion (including the IFRS16 impact) but will fall to €1bn by 2025.

"The strategic plan we are presenting today aims to build a company that grows, generates profits and cash flow with precise development objectives in the traditional energy sector, in the energy transition and in sustainable infrastructures, operating as a technological enabler of low-carbon strategies," said chief executive Francesco Caio.

He described the new strategy as "a change of pace for Saipem which adopts a business model centred on a dual strategy".

"On the one hand, engineering for complex plants designed in partnership with our traditional customers to implement their decarbonisation strategy; on the other hand, the development and construction of modular, standardised and scalable systems and the provision of technologically and digitally advanced services," he said.

"We have started the process of building a more sustainable, technological and profitable Saipem."

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