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TGS: TGS - Q1 update

ASKER, NORWAY (13 April 2015) - Today, TGS announced a Cost Reduction Program
reflecting the deterioration of the market for seismic data seen in the first
quarter of 2015. Based on preliminary reporting from operating units, TGS
management now expects net revenues for the first quarter of 2015 to be
approximately USD 172 million, about 23% lower than revenues reported for the
first quarter of 2014.

Net revenues were lower than management`s expectations due to weaker late
sales from the data library in all geographic regions. Demand for seismic
data has significantly deteriorated over the first three months of 2015 and
the outlook for improvement in the market remains quite uncertain.

TGS is in constant communication with its customers and many of those energy
companies have not finalized their spending plans for 2015. From these
discussions and an assumption that the price of oil will remain under
pressure, TGS expects annual net revenues of approximately USD 630 million
for 2015, down from USD 750 million as originally communicated in January.
Operating profit (EBIT) is expected to be negatively affected by the lower
revenues, however higher amortization will be partly compensated by the
effects of the Cost Reduction Program.

The Cost Reduction Program will position the company for the more challenging
seismic market caused by the significant drop in oil price. A key element of
this program is a reduction of more than 10% of TGS' global workforce
effective from April. Restructuring charges of approximately USD 4 million
will be booked in Q2 as a result of this Program. The company expects annual
cost savings of approximately USD 10 million as a result of the Cost
Reduction Program. In addition to the reduction in headcount, Management has
taken concrete actions to recognize additional operational cost savings from
the original 2015 budget. Management will continue to review the Company's
cost structure and if necessary, take additional action to reduce cost if the
market continues to deteriorate.

Cash flow was strong in Q1 as cash holdings increased from USD 256 million at
year-end 2014 to USD 352 million as of 31 March 2015. In addition, the
company has an undrawn credit facility of USD 50 million resulting in a total
liquidity reserve of USD 402 million. The strong balance sheet and liquidity
position continue to provide dividend support going forward. The Board of
Directors has reviewed the Company's financial situation, including the
Company's distributable reserves according to the annual accounts for 2014.
On this basis and in accordance with the Company's resolved dividend policy,
the Board of Directors wishes to be authorized to distribute quarterly
dividend payments from Q1 2016. Reference is made to the Notice to the Annual
General Meeting published this morning for more information on the quarterly
dividend proposal.

The full first quarter earnings release is scheduled for 23 April 2015. A
conference call will be held the same day in association with that release.

Company summary

TGS-NOPEC Geophysical Company (TGS) provides multi-client geoscience data to
oil and gas Exploration and Production companies worldwide. In addition to
extensive global geophysical and geological data libraries that include
multi-client seismic data, magnetic and gravity data, digital well logs,
production data and directional surveys, TGS also offers advanced processing
and imaging services, interpretation products and data integration solutions.

For more information visit TGS online at

Forward-looking statements and contact information

All statements in this press release other than statements of historical fact
are forward-looking statements, which are subject to a number of risks,
uncertainties and assumptions that are difficult to predict, and are based
upon assumptions as to future events that may not prove accurate. These
factors include TGS' reliance on a cyclical industry and principal customers,
TGS' ability to continue to expand markets for licensing of data, and TGS'
ability to acquire and process data products at costs commensurate with
profitability. Actual results may differ materially from those expected or
projected in the forward-looking statements. TGS undertakes no responsibility
or obligation to update or alter forward-looking statements for any reason.

TGS-NOPEC Geophysical Company ASA is listed on the Oslo Stock Exchange

TGS sponsored American Depositary Shares trade on the U.S. over-the-counter
market under the symbol "TGSGY".

For additional information about this press release please contact:

Kristian Johansen

COO / Interim CFO
Tel: +47 47 60 33 34

Will Ashby

Director, Finance Western Hemisphere&Investor Relations
Tel: +1 713 860 2184

This information is subject of the disclosure requirements acc. to §5-12 vphl
(Norwegian Securities Trading Act)


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: TGS via Globenewswire


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