Saipem S.p.A is one of the largest engineering and construction companies with operations in the oil and gas sector worldwide. Its shares are listed on the Milan stock exchange. On 29 January 2013, suddenly and in a massive revision of its previous updates, Saipem cut its expected 2013 EBIT by a hefty 50%, mainly blaming margins on pending contracts that were below expectations. This was followed by a second profit warning on 14 June 2013, cutting the expected EBIT down further to zero. The stock price lost a cumulative 50% following those two profit warnings.
On the basis of an in-depth review of Saipem’s past financial performance and investor communications, Deminor believes that the company was aware of the circumstances that led to the two profit warnings at a much earlier point in time than January or June 2013.
Consob, the Italian stock market regulator, initiated various investigations which have led to several administrative sanctions, among which one for late profit warning. Deminor is advising a group of 64 institutional investors regarding their options for recovering the c.a. EUR 174 million losses they suffered following the two profit warnings. A legal action was filed before the court of Milan in April 2015.