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SeaBird Exploration Plc: First Quarter Report 2014


* Revenues for the quarter were $33.7 million, a decrease of 33% compared to
the comparable period in 2013 and down 13% relative to Q4 2013.
* Contract revenues for the period were $30.5 million, down 39% from Q1 2013
and down 9% from Q4 2013.
* Multi-client revenues were $3.2 million, up from $0.1 million reported in
Q1 2013 and a decrease of 37% from $5.1 million reported in Q4 2013.
* Contract surveys during the first quarter represented 64% of vessel
capacity compared to 53% during the fourth quarter 2013.
* EBITDA was $10.2 million compared to $11.5 million for Q1 2013 and $3.9
million for Q4 2013.
* EBIT for the quarter was $2.4 million compared to $5.4 million for Q1 2013
and negative $4.6 million for Q4 2013.
* Vessel utilization for the period was 76% compared to 56% in the prior

Operational review

Higher utilization and multi-client investment resulted in improved earnings
for the period. Enhanced focus on expense management also positively impacted
results. Market demand for 2D and source capacity strengthened towards the
latter part of the period. However, the 3D segment has been slower to
recover. Pricing has remained firm.

Contract surveys represented 64% of vessel capacity compared to 53% for the
fourth quarter of 2013. Hawk Explorer and Northern Explorer commenced a joint
20,000 kilometer survey in East Africa. In March, Osprey Explorer initiated a
5,800 kilometer 2D survey in South America. Aquila Explorer completed a 2D
survey with a major oil company in Australasia and is continuing to operate
within the region. Harrier Explorer and Munin Explorer both performed source
operations during the period.

We continue to see demand for source operations and a significant portion of
the fleet was employed in this market during the first quarter. There has
also been further interest in longer-term contracts as well as framework
agreements. During the quarter, we signed a three-year master service
agreement with a major industry participant. Moreover, the company executed a
letter of intent with TGS-NOPEC Geophysical Company to acquire up to 200,000
kilometers of 2D seismic data in Mexico.

Multi-client sales were lower compared to the previous quarter. The majority
of revenues in this segment related to prefunding of Geo Pacific's West
African survey. The remaining portion was primarily associated with late
sales from pre-2013 surveys.

Multi-client utilization was 12% for the period compared to 3% in the fourth
quarter of 2013. The increased activity relates to the Geo Pacific's 2,600
square kilometer 3D multi-client program. The survey is anticipated to be
completed towards the end of the second quarter.

There were no yard stays or significant upgrades carried out during the

Vessel utilization was 76%, up from 56% in the fourth quarter. Operational
performance of the fleet was solid, with technical downtime below 4%.

The company reported lost time injury frequency (LTIF) rate of zero.
Pre-qualification audits were also completed for two oil companies, with both
resulting in the company's status being upgraded to the highest level.

Regional overview

Revenues in Europe Africa and the Middle East (EAME) improved significantly
from the prior period with half of the fleet active in this region.
Repositioning of vessel capacity to the EAME region resulted in decreased
revenues in North and South America (NSA). Asia Pacific (APAC) revenues were
down slightly from the fourth quarter of 2013 due to reduced multi-client
sales. Lower niche 3D demand also impacted this region.

Sales in EAME of $17.1 million accounted for 51% of total revenues. Revenues
increased compared to the prior period as Northern Explorer completed a
longer contract in the Mediterranean and repositioned to commence a joint
project with Hawk Explorer in East Africa. This project will keep both
vessels active in the region through the majority of the second quarter.
Moreover, Geo Pacific initiated its first multi-client project in West
Africa. Harrier Explorer continued its source contract in the North Sea.

APAC sales of $10.4 million accounted for 31% of total revenues. APAC revenues
were down slightly compared to the fourth quarter 2013. Aquila Explorer
completed a 2D survey with a major oil company and will operate within the
region throughout the second quarter. Towards the end of the quarter, Voyager
Explorer commenced a 2D project.

Sales in NSA of $6.2 million represented 18% of total revenues. The decrease
in NSA revenues was mainly due to the repositioning of the Geo Pacific to
West Africa and a delay in contract start-up for Osprey Explorer's project in
South America.


The 2D and source market tender activity improved in the first part of 2014
and the company's backlog recovered substantially. However, we continue to
see delays in permitting as well as commitment of prefunding, which are both
impacting the startup of new projects. Moreover, in light of the short
visibility in the seismic industry we would like to see the current demand
continue for some time before we feel comfortable that the market has fully

The recovery in the niche 3D market has been slower to materialize. While we
are reviewing a number of potential contract opportunities, the tender
activity is below historical market levels.

Pricing in all segments and regions has remained firm and we would largely
anticipate day rates to remain stable through the first half of the year.

Given the current levels of prefunding, the company may find it more
challenging to identify attractive multi-client opportunities. For existing
surveys, late sales are expected to continue but revenues are difficult to
predict given the limited size of the library.


Financial comparison

All figures below relate to continuing operations unless otherwise stated.
For discontinued operations, see note 1.

The company reports a net loss of $0.6 million for Q1 2014 (profit of $1.8
million in the same period in 2013).

Revenues were $33.7 million in Q1 2014 ($50.0 million). The decreased revenues
are primarily due to lower vessel utilization and increased multi-client
activity during the period.

Cost of sales was $19.7 million in Q1 2014 ($34.1 million). The decrease is
mainly due to an increase in multi-client activity and a continued cost focus
across the fleet.

SG&A was $4.9 million in Q1 2014, up from $4.6 million in Q1 2013. This is
principally due to an increase in employee numbers in line with a larger
fleet size.

EBITDA was $10.2 million in Q1 2014 ($11.5 million).

Depreciation and amortization were $7.8 million in Q1 2014 ($6.0 million). The
increase is predominantly due to an increase in multi-client sales
amortization in the period.

Interest expense was $3.0 million in Q1 2014 ($3.0 million).

Other financial items, net expense, of positive $0.2 million in Q1 2014
(negative $0.1 million). The change is mainly due to currency fluctuations.

Income tax expense was $0.3 million in Q1 2014 (expense of $0.6 million). The
decrease is predominantly due to operating in regions with lower corporate
and withholding tax rates during the quarter.

Capital expenditures were $2.4 million in Q1 2014 ($6.8 million). Capital cost
items for the quarter related to the purchase of routine seismic and other
equipment across the fleet.

Multi-client investment was $7.4 million in Q1 2014 ($0.2 million), which
related to the Geo Pacific's 3D multi-client survey in West Africa.

Net profit from discontinued operations was $0.4 million for Q1 2014 (loss of
$0.5 million). Discontinued operations represent the remaining contractual
obligations of the ocean bottom node (OBN) business, which was divested in

Liquidity and financing

Cash and cash equivalents at the end of the period were $16.0 million ($16.5
million), of which $4.3 million was restricted in connection with deposits
and the bond service account. Net cash from operating activities was $14.9
million in Q1 2014 ($8.2 million).

The company has one bond loan, one convertible loan and the Hawk Explorer
finance lease.

* The 6% secured bond loan has a face value of $83.9 million and is
recognized in the books at amortized cost of $76.9 million per Q1 2014. The
bond loan matures 19 December 2015 and has principal amortization due in
semi-annual increments of $2.0 million that started 19 December 2012.
* The 1% unsecured convertible loan with Perestroika AS has a face value of
$14.9 million and is recognized in the books at amortized cost of $14.3
million per Q1 2014. The convertible loan matures 30 September 2014 and has
no principal amortization. Interest on the convertible loan is paid
annually. No interest was paid during Q1 2014 in relation to the
convertible loan.
* The lease of Hawk Explorer is recognized in the books as a finance lease at
$8.3 million per Q1 2014. Installments of $1.0 million against the Hawk
lease principal and $0.3 million against the interest portion were paid
during Q1 2014 ($0.9 million and $0.4 million in Q1 2013, respectively).
During the third quarter 2013, the company announced that it will exercise
its option under the current charter agreement to purchase the vessel and
related equipment for $6.5 million. The vessel and equipment will be
delivered at the end of the lease term 31 August 2014 against settlement of
the purchase price.

Management is currently reviewing possible refinancing alternatives open to
the company.

Net interest-bearing debt was $83.5 million at the end of Q1 2014 ($85.9

Accrued interest for Q1 2014 was $1.4 million ($1.4 million).

The company was in compliance with all covenants as of 31 March 2014.

The Board of Directors and
Chief Executive Officer
SeaBird Exploration Plc
5 May 2014

The first quarter 2014 presentation will be transmitted live

This information is subject of the disclosure requirements pursuant to section
5-12 of the Norwegian Securities Trading Act.

Q1-14 Presentation
Q1-14 Report


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: SeaBird Exploration Plc via Globenewswire


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