Subsea7 Marks 53% Profit Rise Ahead of Planned Saipem Merger

(Credit: Subsea7)

Oslo-listed energy service group Subsea 7, which plans to merge with Italian rival Saipem, said on Thursday its core profit rose 53% last year, in line with its previous guidance.

Subsea 7 and Saipem announced on Sunday a plan to create a leading provider of offshore engineering and construction services for petroleum and renewable energy industries.

"The combination would enhance value for shareholders, clients and other stakeholders, both in the current market and in the long term," Subsea 7's chairman and largest shareholder, Kristian Siem, said in a statement.

Subsea 7 reported adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $1.09 billion for the full year 2024, up from $714 million in 2023, and compared with $1 billion-$1.1 billion guidance last November.

The increase in full-year EBITDA was driven by revenue growth of 14% and higher profit margins, the company said.

Subsea 7, which provides services both for offshore petroleum and wind power industries, expects revenue of $6.8 billion to $7.2 billion in 2025, compared with $6.8 billion last year.

Subsea 7's board proposed on Thursday to pay a total of $350 million in dividends to shareholders this year, up 40% from the last year, identical to Saipem and in line with a cap agreed under the proposed merger deal.

Subsea 7 won $2.3 billion in new contract awards in 2024, bringing its total year-end backlog of orders to $11.2 billion, up from $10.6 billion at the end of 2023.

Both Subsea 7 and Saipem, which reported its quarterly and annual results on Tuesday, said combining their businesses would enable them to cut costs and better serve customers worldwide.

The merger, structured as a stock swap, is expected to be completed in the second half of 2026, pending shareholder and regulatory approvals.

(Reuters - Reporting by Nerijus Adomaitis, editing by Terje Solsvik and Hugh Lawson)