TGS Q2 Profit Dips 11 Percent

TGS-to-Conduct-Two-Studies-in-Canada-and-Barents-Sea

TGS reports net revenues of USD 205 million in Q2 2014, compared to USD 210 million in Q2 2013. Earnings before interest and taxes (EBIT) totaled USD 82 million, corresponding to an EBIT margin of 40%. The Company’s net pre-funding revenues were USD 60 million, up 39% from Q2 2013. Backlog of USD 224 million remains near an all-time high level.

2nd QUARTER HIGHLIGHTS

- Consolidated net revenues were USD 205 million, compared to USD 210 million in Q2 2013;
- Net late sales totaled USD 137 million, down 12% from USD 155 million in Q2 2013;
- Net pre-funding revenues were USD 60 million, up 39% from Q2 2013, funding 52% of the Company’s operational multi-client investments during Q2 (investments of USD 114 million, up 4% from Q2 2013);
- Proprietary revenues were USD 8 million, compared to USD 12 million in Q2 2013;
- Operating profit (EBIT) was USD 82 million (40% of net revenues), compared to USD 98 million (47% of net revenues) in Q2 2013;
- Cash flow from operations was USD 66 million, compared to USD 34 million in Q2 2013. In Q2 2013, the Company made an extraordinary tax payment of USD 58 million;

6 MONTHS FINANCIAL HIGHLIGHTS

- Consolidated net revenues were USD 427 million, up from USD 421 million in 2013;
- Net late sales from the multi-client library totaled USD 274 million, down 3% from USD 282 million in H1 2013;
- Net pre-funding revenues were USD 134 million, up 36% from 2013, funding 55% of the Company’s operational multi-client investments during H1 (investments of USD 244 million, up 3% from 2013);
- Proprietary revenues were USD 19 million, compared to USD 41 million in 2013;
- Operating profit (EBIT) was USD 176 million (41% of net revenues), compared to USD 187 million (44% of net revenues) in 2013;
- Cash flow from operations was USD 289 million compared to USD 212 million in 2013, an increase of 36%;
- Earnings per share (fully diluted) were USD 1.25, compared to USD 1.24 in 2013.

“Despite restricted near-term exploration spending as well as the delayed announcement of the blocks for the Norwegian 23rd licensing round, TGS continues to deliver strong results. Both sales from the existing data library and customer commitments for new projects were strong and our backlog remains near an all-time high level. TGS continues to be well positioned to deliver the data needed by the industry to identify new reserves. TGS has a strong commitment to deliver shareholder returns through a combination of growth, dividends and share buy-backs” TGS’ CEO Robert Hobbs stated.

Net income for Q2 2014 was $61.3 million (30% of net revenues), down from $68.2 million in Q2 2013. Quarterly earnings per share (EPS) were USD 0.59 fully diluted (USD 0.60 undiluted), which is down 10% from Q2 2013.