Saipem’s share price crashed yesterday after Europe’s biggest oil industry service group gave its second major profit warning in less than six months amid problems with contracts in Algeria, Mexico and Canada.
The company, 43%-owned by Italian oil firm Eni, said after markets closed on Friday that it now expected to make net losses of £255-£300million this year instead of profits of £382million.
Saipem, at the centre of corruption probes in Italy and Algeria relating to large contracts it had with gas giant Sonatrach, had already surprised the market with a profit warning in January. Shares in the group have plunged in value since the start of 2013, and fell nearly more than 29% yesterday.
Chief executive Pietro Franco Tali was ousted in December, when news of the Algerian probe first emerged and a month later the new management triggered a 34% drop in the firm’s share price in a single day by slashing its profit forecast for 2013.