MILAN : Italian refiner Saras plans to spin off its renewable energy business and bring on board a partner to help fund future development, company managers said on Tuesday.
“We are planning to separate entirely the renewable business, possibly partnering,” Chief Executive Dario Scaffardi said in a call on results and outlook.
Saras, which operates one of Italy’s biggest refineries in Sardinia, is developing a clean energy business that includes wind and solar plants, biofuels and hydrogen.
It is looking to reach 200 megawatts of wind capacity this year and build new renewable capacity of up to 400 MW in 2024 to reach an overall 500 MW to navigate the energy transition.
“We are ready to open the capital to involve a financial partner to develop new capacity,” Chief Financial Office Franco Balsamo said.
Saras last year posted a comparable net loss of 197 million euros ($231 million) compared to a profit of 67.3 million euros a year earlier as oil demand and margins tumbled due to the pandemic.
It reported a comparable core earnings loss of 20.8 million euros from a core profit of 313.8 million euros in 2019.
The refiner, controlled by the Moratti family, said demand was picking up and a substantial market recovery was expected in 2022.
“We see this year as a bridge to recovery…and will navigate to take advantage of improving margins in the second half,” Scaffardi said.
Saras slashed investments this year to 55 million euros from 227 million euros last year, adding that would be a floor in coming years, depending on market conditions.
Asked about dividends, Balsamo said cash flow going forward would be used to pay down debt, especially in the period 2023-2024.
“For the time being dividends are not within the model,” he said.