EMGS’ Second Quarter Revenues Down

Electromagnetic Geoservices ASA’s (EMGS) reported revenues of USD 42.5 million in the second quarter 2014, down from USD 61.3 million in the first quarter this year and from USD 44.4 million in the corresponding quarter last year.

Contract sales totaled USD 35.5 million, while multi-client sales were at USD 7.0 million this quarter. The Company had an EBITDA of USD 10.9 million and a net loss of USD 2.5 million.

Revenues for the first half year 2014 came in at USD 103.8 million, compared with USD 76.1 million for the corresponding period last year. The increase in revenues is related to more contract work this year.

The Company had two vessels operating in Norway in the quarter, of which one vessel acquired 3D EM data in the Barents Sea under the Company’s joint multi-client project with TGS. In addition, one vessel was operating for PEMEX, before going into a planned yard stay, while the fourth vessel, the EM Leader, spent the full quarter acquiring data under the multi-client project called Daybreak in the US Gulf of Mexico.

“We have been awarded a multiple contracts with new and existing customers in Norway this quarter, demonstrating a positive trend for adoption of our EM technology. Going forward, we are optimistic about increasing the visibility by securing additions to our backlog during the second half of this year,” says CEO of EMGS, Roar Bekker.

On 19 August EMGS settled the NOK 75 million convertible bond loan to North Energy. The Company will receive NOK 46.6 million in cash and converted NOK 28.4 million of the loan into 6,851,463 shares in North Energy, at a strike price of NOK 4.1451. After the transaction, EMGS holds 11,851,463 shares in North Energy, representing 9.96%. In addition, the Company receives interest of a total of NOK 2.4 million.

EMGS maintains its guidance to deliver full year 2014 revenues of more than USD 200 million.