Saipem on Monday trimmed its core earnings outlook for 2026, lowering its expected adjusted EBITDA to €1.75 billion from a previous estimate of €1.9 billion. The company said the revision reflects both costs already incurred as a result of the Middle East crisis and an allowance for anticipated expenses that may affect the second half of the year.
The Milan-based contractor emphasized that the precise ability to recover these incremental costs is currently unclear. In a statement, Saipem said: "The recoverability of these extra costs cannot be precisely quantified at this stage, as it is subject to the outcome of commercial discussions with clients."
Saipem said the updated guidance also incorporates the financial impact of the de-consolidation of its shallow-water drilling business, which the company recently sold. That transaction has contributed to the adjustment in the full-year estimate.
In the first half of the year, the group reported roughly €70 million of spending to bolster security for staff in the Gulf and to address logistical challenges that Saipem attributed to the Iran war. The company counts major national energy companies among its clients, including Saudi Aramco (TADAWUL:2223), QatarEnergy and Abu Dhabi’s ADNOC.
Despite the lowered EBITDA outlook, Saipem left unchanged its forecast for full-year operating cash flow at €1 billion.
Operational results showed adjusted EBITDA slipped almost 3% in the second quarter to €402 million. That result missed the analyst consensus of €464 million compiled by LSEG.
Context and implications
- The revised 2026 adjusted EBITDA target reflects both realised costs linked to the Middle East crisis and an allowance for potential additional costs in the second half of the year.
- Security-related expenditures and logistical measures in the Gulf have already amounted to about €70 million in H1.
- The sale and consequent de-consolidation of Saipem’s shallow-water drilling arm has also weighed on the full-year estimate.
Saipem’s decision to hold its €1 billion operating cash flow forecast indicates management expects cash generation to remain resilient despite the earnings revision and heightened costs linked to the regional conflict.