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2016-07-21

Petroleum Geo-Services ASA : Second Quarter and First Half 2016 Results

Cost Reductions Continue

Healthy MultiClient Sales

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Highlights Q2 2016

* Revenues of $183.0 million, compared to $255.8 million in Q2 2015
* EBITDA of $68.8 million, compared to $125.1 million in Q2 2015
* EBIT excluding impairments and other charges/(income) of negative $36.2
million, compared to a profit of $15.9 million in Q2 2015
* MultiClient pre-funding revenues of $47.2 million with a corresponding
pre-funding level of 113%, compared to $112.0 million and 152%,
respectively, in Q2 2015
* MultiClient late sales of $46.0 million, compared to $33.5 million in Q2
2015
* Gross cash cost further reduced, ending at $158.4 million, compared to
$207.6 million in Q2 2015
* Cash flow from operations of $42.4 million, compared to $83.1 million in Q2
2015
* Liquidity reserve of $429.7 million, compared to $545.7 million in Q2 2015
* Ramform Tethys andSanco Swift commenced operations in the North Sea
* Settled EM patent dispute between PGS and EMGS
* Leverage ratio maintenance covenant of the Revolving Credit Facility
amended to increase headroom

"With the gradual recovery of the oil price from its lows in early Q1, we are
starting to see early signs of a stabilizing market and improving sentiment.
We believe that this has started to impact our MultiClient performance
positively. The marine contract market is still characterized by very low
pricing, but here too we see indications of more predictable patterns in
customer survey planning and contracting processes. Due to stacking of
capacity, the seismic vessel supply/demand balance has improved substantially
since this time last year.

Capital expenditures were relatively high in the quarter, primarily due to the
yard installment at floating and equipment for our last new build,Ramform
Hyperion
. Of the guided $165 million in new build capital expenditures this year we
have already incurred $140 million in the first half and thus our cash flow
will be more balanced for the remainder of the year.

Our liquidity position is adequate and there are no material debt maturities
until late 2018. With the amended maintenance covenant for the Revolving
Credit Facility we have strengthened our ability to navigate beyond the
trough of this cycle and created a substantial time window to address 2018
refinancing needs in tune with how the market develops. We continue to focus
on what we can control through relentless sales efforts, strict cost
discipline, operational excellence and capitalizing on the youngest and most
productive fleet in the industry."

Jon Erik Reinhardsen,
President and Chief Executive Officer

Outlook

The oil price and reduced oil company spending continue to impact seismic
demand. Despite some oil price recovery and signs of an improved market
sentiment, PGS expects the market uncertainty to continue through 2016.

Based on the current operational projections and with reference to disclosed
risk factors, PGS expects full year 2016 gross cash cost at or below $700
million.

MultiClient cash investments are expected to be approximately $225 million,
with a pre-funding level of approximately 100%.

40-45% of active 3D vessel time is currently planned for MultiClient
acquisition.

Capital expenditures are expected to be approximately $225 million, of which
approximately $165 million is for the new buildsRamform Tethys
andRamform Hyperion
.

The order book totaled $230 million at June 30, 2016 (including $123 million
relating to MultiClient), compared to $204 million at March 31, 2016 and $259
million at June 30, 2015.

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| Key Financial Figures Quarter ended Six months ended Year ended December 31, |
| |
|(In USD millions, except per share data) June 30, June 30, |
| 2016 2015 2016 2015 2015 |
| Revenues 183.0 255.8 386.1 506.9 961.9 |
| EBITDA (as defined, see Note 13) 68.8 125.1 147.5 252.6 484.4 |
| EBIT ex. impairment and other charges/(income) (36.2) 15.9 (66.3) 29.5 15.8 |
| EBIT as reported (44.6) (45.7) (76.1) (34.8) (430.4) |
| Income (loss) before income tax expense (57.7) (57.9) (119.6) (67.9) (505.5) |
| Net income (loss) to equity holders (51.8) (63.8) (108.7) (83.3) (527.9) |
| Basic earnings per share ($ per share) (0.22) (0.30) (0.46) (0.39) (2.43) |
| Net cash provided by operating activities 42.4 83.1 175.8 295.4 487.9 |
| Cash investment in MultiClient library 41.8 73.6 90.1 137.6 303.3 |
| Capital expenditures (whether paid or not) 51.9 63.3 160.9 104.8 165.7 |
| Total assets 2 970.3 3 297.4 2 970.3 3 297.4 2 914.1 |
| Cash and cash equivalents 49.7 57.6 49.7 57.6 81.6 |
| Net interest bearing debt 1 207.6 995.0 1 207.6 995.0 994.2 |
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The complete Q2 and first half 2016 results earnings release can be downloaded
fromwww.newsweb.noorwww.pgs.com.

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| FOR DETAILS, CONTACT: |
| Bård Stenberg |
|, VP Corporate Communications |
| |
|Phone: +47 67 51 43 16 |
|Mobile: +47 99 24 52 35 |
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This information is subject to the disclosure requirements pursuant to section
5-12 of the Norwegian Securities Trading Act.

Q2 2016 Presentation
http://hugin.info/115/R/2029728/754894.pdf
Q2 2016 Earnings Release
http://hugin.info/115/R/2029728/754891.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: Petroleum Geo-Services ASA via Globenewswire

HUG#2029728

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