Saipem — Investor Presentation 2019

Jul 25, 2019

FIRST HALF 2019 RESULTS PRESENTATION

FORWARD-LOOKING STATEMENTS

Forward-looking statements contained in this presentation regrading future events and future results are based on current expectations, estimates, forecasts and projections about the industries in which Saipem S.p.A. (the "Company") operates, as well as the beliefs and assumptions of the Company's management.

These forward-looking statements are only predictions and are subject to known and unknown risks, uncertainties, assumptions and other factors beyond the Company' control that are difficult to predict because they relate to events and depend on circumstances that will occur in the future. These include, but are not limited to: forex and interest rate fluctuations, commodity price volatility, credit and liquidity risks, HSE risks, the levels of capital expenditure in the oil and gas industry and other sectors, political instability in areas where the Group operates, actions by competitors, success of commercial transactions, risks associated with the execution of projects (including ongoing investment projects), in addition to changes in stakeholders' expectations and other changes affecting business conditions.

Therefore, the Company's actual results may differ materially and adversely from those expressed or implied in any forward-looking statements. They are neither statements of historical fact nor guarantees of future performance. The Company therefore caution against relying on any of these forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, economic conditions globally, the impact of competition, political and economic developments in the countries in which the Company operates, and regulatory developments in Italy and internationally. Any forward-looking statements made by or on behalf of the Company speak only as of the date they are made. The Company undertakes no obligation to update any forward-looking statements to reflect any changes in the Company's expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based. Accordingly, readers should not place undue reliance on forward-looking statements due to the inherent uncertainty therein.

The Financial Reports contain analyses of some of the aforementioned risks.

Forward-looking statements neither represent nor can be considered as estimates for legal, accounting, fiscal or investment purposes. Forward-looking statements are not intended to provide assurances and/or solicit investment.

1	OPENING REMARKS
2	1H 2019 RESULTS
3	BUSINESS UPDATE
4	GUIDANCE AND CLOSING REMARKS

OPENING REMARKS

1H 2019

Major LNG award in Mozambique worth \$6bn

Book-to-bill above 2x in 1H

Backlog above €17bn

Visibility improving, award momentum to continue

Solid results across the divisions, in trend with FY 2019 targets

• E&C Offshore: solid operational performance
• E&C Onshore: turnaround continues
• Drilling: growing volumes, margins adjusting to current environment

Net debt improved at €1bn New year-end net debt guidance: below €0.8bn

1H 2019 RESULTS

1H 2019 RESULTS

YoY COMPARISON (€ mn)

1H 2019 RESULTS – E&C

YoY COMPARISON (€ mn)

(*) E&C Onshore including Floaters business and XSight

IFRS 16 Impact

• Higher volumes in Middle East and North Africa
• Solid margin underpinned by good execution
• Higher volumes in Middle and Far East, West Africa and Caspian
• Margin expansion confirming turnaround

1H 2019 RESULTS – DRILLING

YoY COMPARISON (€ mn)

• Higher volumes driven by SC8, S12000, Pioneer (leased)
• Phasing out of past projects reflects on EBITDA margin
• Growth driven by activity in Saudi Arabia and Latin America
• Broadly stable margins QoQ

8

1H 2019 NET RESULT RECONCILIATION ADJUSTED-REPORTED

Net Result (€ mn)

(*) Write-down of jackup Perro Negro 5 and related working capital

1H 2019 NET DEBT EVOLUTION

(€ bn)

DERISKED WORKING CAPITAL

UNBILLED REVENUES LINKED TO LEGAL DISPUTES

• Gladstone arbitration in Australia positively resolved in line with expectations
• Commercial discipline, de-risking actions and settlements reduced unbilled revenues to negligible level

BUSINESS UPDATE

A NEW FRONTIER MOZAMBIQUE

STRATEGIC POSITIONING

• Part of Maritime Silk Road
• Privileged Commercial Hub of India and China for African Market
• Significant infrastructure development envisaged

KEY ENERGY RESOURCES

• First natural gas discovery in Area 1 in 2010
• Significant natural gas reserves, estimated at +2,000bn m³
• Various fields under development by major players

OUR VALUE PROPOSITION

• Strong expertise and know-how in executing large/complex projects in remote areas and deep water
• Developing a key role in energy transition
• Established presence and strong track record in Sub-Saharan Africa

13

MAIN RECENT AWARDS: ANADARKO MOZAMBIQUE LNG LNG MOMENTUM CONFIRMED

PROJECT DETAILS

• Client: Anadarko Petroleum Corporation
• Location: Mozambique
• Scheme: JV among Saipem (leader), McDermott and Chiyoda
• Scope of Work: Engineering, Procurement and Construction of two Natural Gas Liquefaction (LNG) trains, with a total capacity of 12.9 MTPA, as well as all necessary associated infrastructure, storage tanks and export jetty facilities
• Project Value - Saipem share: \$6bn

HIGHLIGHTS

• ➢ Major award for Saipem
• ➢ Remote frontier area with limited infrastructure
• ➢ Focus on execution and local supply chain
• ➢ Technologically and logistically complex

FOCUS ON GAS VALUE CHAIN

MAIN RECENT AWARDS

E&C – 2Q 2019

MOSCOW REFINERY

• Client: JSC GazpromNeft
• Location: Russia
• Scope of work: EPC for new Sulphur recovery unit (SRU) encompassing 6 trains, among which 2 trains of 280 MTA of Sulphur Claus and TGTU with Liquid and Solid Sulphur handling

HIGHLIGHTS:

Reduction of sulphur emissions, complying with highest levels of environmental and safety standards

Positioning to benefit from potential new investments in the refinery

SERBIA PIPELINE

• Client: Infrastructure Development and Construction (IDC)
• Location: Serbia
• Scope of work: design and construction of approx. 150 km of gas pipeline and engineering of compressor station

HIGHLIGHTS:

Part of the 400 km interconnector gas pipeline in Serbia Construction activities performed on a direct hire base with Saipem specialized equipment

LTA 43 – BERRI DOWNSTREAM PIPELINES

• Client: Saudi Aramco
• Location: Kingdom of Saudi Arabia
• Scope of work: EPC of pipelines for crude and condensates, interconnecting Abu Ali gas-oil separation plant with Khursaniyah gas plant

HIGHLIGHTS:

15

Award falling under Long Term frame Agreement, consolidating presence in the Middle East

MAIN RECENT AWARDS CONT'D E&C – POST 2Q 2019

BERRI - PKG-01 EXPAND ABU ALI CRUDE & KGP GAS FACILITIES

• Client: Saudi Aramco
• Location: Kingdom of Saudi Arabia
• Scope of work: EPC for new units for the Abu Ali oil-gas separation plant and the Khursaniyah gas treatment plant

MARJAN – PKG-10 GAS TREATMENT AND SULFUR RECOVERY

• Client: Saudi Aramco
• Location: Kingdom of Saudi Arabia
• Scope of work: EPC for new units for gas treatment and the recovery of acid gases for sulfur production

HIGHLIGHTS:

Recognition of expertise in large/complex projects further strengthens client relationship Supporting Saudi Aramco in complying with CO2 emission standards

MAIN RECENT AWARDS

DRILLING OFFSHORE

SEA LION 7 - NEW LEASED JACKUP

• Client: Saudi Aramco
• Location: Saudi Arabia
• Terms: 3 years firm period + 1-year option; expected to start in 4Q 2019

HIGHLIGHTS:

Additional leased rig joining Saipem fleet, in line with our asset-light strategy Hi-spec jackup

SCARABEO 8

• Client: Repsol Norge AS
• Location: Norway
• Terms: 1 well; starting in 4Q 2019

HIGHLIGHTS:

New client in Drilling Offshore

SCARABEO 9

• Client: GSP
• Location: Romania
• Terms: 1 wells; starting in 3Q 2019

HIGHLIGHTS:

Back in the Black Sea, rig under preparation for bridge crossing

PERRO NEGRO 8

• Client: ADNOC
• Location: United Arab Emirates
• Terms: 4 years contract + 1-year option in continuation from previous engagement

HIGHLIGHTS:

Extension of activity, long term contract

OFFSHORE DRILLING FLEET

Committed New awards in 2Q19 and 3Q19 to-date Optional period

			2019	2020	2021	CLIENT	AREA
d n a R A E R T T A L W U P- E E D	V. N E H RS A H	Saipem 12000			TO 2022>	Eni	Pakistan-Mozamb.
		Saipem 10000				Eni	Egypt
		Scarabeo 9				Eni - GSP	Egypt-Romania
		Scarabeo 8				AkerBP - Vår Ener. Repsol-Wintershall	Norway
P- E	R E T	Scarabeo 7				Eni	Indonesia
E D	A W	Scarabeo 5*				-	-
R E T A W W- O L L A H S	C HI SPE	Perro Negro 8			TO 2023>	ADNOC	UAE
		Perro Negro 7				Saudi Aramco	Saudi Arabia
		Pioneer**			TO 2023>	Eni	Mexico
		Sea Lion 7**			TO 2022>	Saudi Aramco	Saudi Arabia
	D R A D N A T S	Perro Negro 5 \ New Vessel**	PN5	NEW LEASE	TO 2024>	Saudi Aramco	Saudi Arabia
		Perro Negro 4				Petrobel	Egypt
		Perro Negro 2*				-	-
		TENDER ASSISTED TAD

ONSHORE DRILLING FLEET

1H 2019 BACKLOG

(*) E&C Onshore including Floaters business and XSight

1H 2019 BACKLOG BY YEAR OF EXECUTION (€ mn)

NON-CONSOLIDATED BACKLOG BY YEAR OF EXECUTION

	2019	2020	2021+
€ mn	174	546	1,078

(*) E&C Onshore including Floaters business and XSight

E&C BACKLOG BREAKDOWN EVOLUTION BACKLOG MAINLY DRIVEN BY GAS

(*) Estimate YTD includes: 1) E&C backlog at end of June 2019 for €16.2bn and 2) E&C order intake post-2Q to-date for c.€3.1bn

E&C OFFSHORE OPPORTUNITIES

GOOD VISIBILITY ON €8 BILLION NEAR-TERM INITIATIVES

GUIDANCE AND CLOSING REMARKS

2019 GUIDANCE UPDATE PRE IFRS 16

CLOSING REMARKS

ROBUST ORDER INTAKE DRIVES BACKLOG ABOVE €17bn, IMPROVING MEDIUM-TO-LONG TERM VISIBILITY

GOOD OPERATIONAL RESULTS ON TREND WITH YEARLY GUIDANCE

VISIBILITY REMAINS GOOD ON SELECTED NEAR TERM E&C OPPORTUNITIES

ACCELERATING DELEVERAGE, NET DEBT 2019 GUIDANCE IMPROVED AT BELOW €0.8bn

APPENDIX

25 July 2019

2Q 2019 RESULTS

QoQ TREND (€ mn)

2Q 2019 RESULTS

QoQ TREND (pre IFRS 16 - € mn)

(*) E&C Onshore including Floaters business and XSight

1H 2019 RESULTS – D&A, FINANCE CHARGES AND TAX RATE

IFRS 16 IMPACT RECONCILIATION

CAPITAL STRUCTURE AS OF JUNE 30, 2019 LIQUIDITY AND MATURITY PROFILE (€ mn)

• Average debt maturity c.3.2 years. Overall financing interest rate c.4%, including treasury hedging
• Undrawn committed cash facilities totalling c.€1.2bn, in addition to c.€0.2bn of uncommitted facilities
• Available cash and equivalent c.€1.4bn**

(*) Committed (**) Not including trapped cash and marketable securities/other credit for c.€0.5bn

SOUND FINANCIAL STRUCTURE

E&C ONSHORE OPPORTUNITIES

GOOD VISIBILITY ON €13.5 BILLION NEAR-TERM INITIATIVES