The Italian oil and gas company Saipem announced on Tuesday that it will reduce its workforce in Europe over the next four years as part of its new strategic plan for 2017-2020.
The company announced its results for the third quarter of the year, posting a loss in face of challenging market conditions.
“As well as generating greater efficiency in its European based facilities (reduction in headcount of around 800), thanks to the new and leaner operating processes, the new organisation will lead to a better deployment of human resources competences within the Group”, Saipem informed in its Q3 report.
Saipem Cuts European Workforce by 800
“The Strategic Plan also includes rationalisation of the asset base, mainly concerning a number of vessels and rigs in the Drilling and Offshore E&C sectors, in addition to several yards in the Offshore and Onshore E&C sectors,” the company informed further.
This follows the approval of a new strategic plan that identifies a set of measures to face a planned long recovery.
According to the company, the basis of its new strategy will be on refocusing the business portfolio, de-risking operations, optimising costs, making processes more efficient and emphasising technology and innovation.
To this effect, Saipem will adopt a “new, leaner, more effective and more efficient organisational model” with the creation of five divisions for offshore construction, onshore construction, offshore drilling, onshore drilling and engineering activities and services.
Downturn Lasting Longer than Expected
“In the first nine months of 2016, we achieved results that are both encouraging and in line with expectations, thanks to solid performances by both the Offshore E&C and Drilling sectors, the latter still benefitting from long-term contracts,” Saipem CEO, Stefano Cao, said.
According to the CEO, the company’s performance during the third quarter included a “positive downtrend in net debt” and “a strong performance in terms of new contract awards”.
“The downturn in our sector, which is lasting longer than initially expected, has affected market prospects and requires reduction in the value of the Company’s asset base,” he explained.
“The Strategic Plan that we have just approved aims to respond to these challenges through the adoption of a new organisational model,” he added.