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2015-08-20

EMGS: EMGS reports second quarter 2015 results

Electromagnetic Geoservices ASA (EMGS) recorded revenues of USD 12.1 million
in the second quarter 2015, down from 32.3 million in the previous quarter
and from USD 42.5 million in the second quarter 2014. Contract sales ended at
USD 4.8 million, while sales from the multi-client library ended at USD 7.3
million. The results were negatively affected by extraordinary costs related
to the Company's cost reduction program. EBITDA ended with a negative USD 6.0
million after a multi-client investment of USD 14.0 million. An impairment of
goodwill related to the OHM acquisition in 2011 of USD 14.4 million resulted
in a net loss for the second quarter 2015 of USD 26.0 million.
"In the second quarter we were, as expected, more affected by the challenging
market conditions than in the previous quarter. We had planned for a higher
contract utilisation in the quarter, but negotiations were delayed. During
the quarter, we have therefore invested in what we consider to be good and
timely multi-client projects, as we see these as important for the future
development of our Company," says CEO of EMGS, Bjarte Bruheim.
During the quarter, EMGS announced and implemented a cost reduction program
including a 20% reduction in headcount and a reduction from three to four
vessels by taking out the EM Leader from mid-May. In addition, the Company
announced that the capital expenditures for 2015 would be reduced.
The Company's three other vessels were mainly operating on multi-client
projects in Norway, US Gulf of Mexico and in Indonesia.
In the second half of 2015, EMGS will perform the announced contract work for
an oil company in Malaysia and re-start its work for Pemex in Mexico. The
Company also expects further contract work in Asia.
The market outlook is currently hard to predict. Contract negotiations are
delayed and the oil companies' spending and budgets are further revised and
reduced. As a consequence, EMGS Board and management will continue the work
to reduce the Company's cost level and capital expenditures. Still, the
Company experience good progress on the adoption of the EM technology. The
interest from oil companies is increasing, although challenged by reduced
budgets. The continuous pressure on these companies to cut costs and increase
efficiency, also require them to improve their success rates in exploration.

Please find the full report for the second quarter and first half 2015
enclosed. The results will be presented at 10:00 CET today at the Company's
premises in Dronning Mauds gate 15 in Oslo. The presentation will be
published at 09:30 CET.
Contacts

Svein Knudsen, EMGS chief financial officer, +47 911 41 149

Charlotte Knudsen, EMGS head of investor relations, +47 97 56 19 59
About EMGS

EMGS, the marine EM market leader, uses its proprietary electromagnetic (EM)
technology to support oil and gas companies in their search for offshore
hydrocarbons. EMGS supports each stage in the workflow, from survey design
and data acquisition to processing and interpretation. The company's services
enable the integration of EM data with seismic and other geophysical and
geological information to give explorationists a clearer and more complete
understanding of the subsurface. This improves exploration efficiency and
reduces risks and the finding costs per barrel.
EMGS operates on a worldwide basis with main offices in Trondheim and Oslo,
Norway; Houston, USA; and Kuala Lumpur, Malaysia.
For more information, visitwww.emgs.com

This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.
Second quarter report 2015
http://hugin.info/137402/R/1946585/706417.pdf

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This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: EMGS via Globenewswire

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