March 20, 2014 / 11:11 AM / in 4 years

UPDATE 1-Italy's Salini Impregilo cuts business targets in new plan

* Sees 2017 EBIT of 500 million euros

* Expects to turn cash-positive by end-2017

* Shares up 1 pct, outperform Milan bourse (Recasts, adds detail)

MILAN, March 20 (Reuters) - Italy’s biggest construction group Salini Impregilo unveiled lower targets in its new business plan after posting better than expected 2013 result on Thursday.

Shares in the group outperformed the broader market, responding positively to full-year operating profit (EBIT) of 234 million euros ($325.5 million) and what analysts viewed as a more attainable EBIT target of 500 million euros by 2017.

The group, involved in major infrastrucure projects such as the expansion of the Panama Canal and the huge Grand Renaissance Dam in Ethiopia, cited continuing uncertainty in the global economy for scaling back its 2017 target from the previous 2016 objective of 670 million euros.

Salini Impregilo, which completed the incorporation of Impregilo into Salini in January, said on Wednesday that it had agreed to sell its waste-to-energy business Fisia Babcock for 139 million euros. On Thursday it said it could also sell its Todini construction subsidiary by the end of the year.

Over the life of the business plan Salini Impregilo expects annual orders to average more than 7 billion euros, down from 8.6 billion euros in 2013 and the 7.5 billion euros under the previous plan. Net debt of 332 million euros at the end of last year should turn positive at about 500 million euros by the end of 2017, the company said.

Salini Impregilo is part of the consortium of companies widening the 100-year-old Panama Canal and which last week settled a long-running dispute over cost overruns that had put the multibillion-dollar project in jeopardy.

By 1055 GMT the company’s shares were up 1 percent, against a 0.6 percent decline for the broader Milan bourse.

The company said on Thursday that it is confident about plans to increase the number of shares freely tradeable on the market through a capital increase. The free float currently stands at about 10 percent. ($1 = 0.7189 Euros)

Reporting by Danilo Masoni and Lisa Jucca; Editing by David Goodman

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