CGGVeritas Announces Second Quarter 2007 Results
02 Agosto 2007 - 12:00AM
PR Newswire (US)
PARIS, August 2 /PRNewswire-FirstCall/ -- - Revenues of $769
Million, up 37% - Net Result of EUR45 Million, or $60 Million -
First Half 2007 Results on Target - 10% First Half net Income and a
Strong Forward Outlook CGGVeritas (ISIN: 0000120164 - NYSE: CGV)
today announced its second quarter 2007 unaudited financial
results. Financial Highlights(1): Group: - Revenues of EUR571
million ($769 million), up 28% in EUR and 37% in $ - EBITDA of
EUR210 million ($284 million), and EBITDA margin of 37% compared to
EUR168 million, ($ 212 million), and EBITDA margin of 38% -
Purchase Price Allocation (PPA) negative impact of EUR7 million ($9
million) - Operating Profit, including PPA, of EUR101 million ($136
million), a 18% operating margin compared to EUR66 million ($85
million), a 15% operating margin - Net Profit of EUR45 million ($60
million) compared to EUR18 million ($23 million). - EPS of EUR1.56
($2.11) Services: - Revenues of EUR390 million ($525 million), up
26% in EUR and 34% in $ - EBITDA margin of 38% compared to 43% -
Operating Profit of EUR46 million ($62 million), including PPA, a
12% operating margin compared to 11% Sercel: - Revenues of EUR196
million, ($264 million), up 18 % in EUR and 28% in $ - Operating
Profit of EUR67 million ($91 million), an operating margin of 34%
compared to 27% Operational Highlights: - 26 land seismic crews in
operation for the slower spring season, after demobilization of the
arctic crews - Vessel utilization rate was lower at 75% with
scheduled dry docks for performance upgrade and maintenance - The
new seismic vessel, CGGVeritas Vision, completed successful sea
trials and became active in our fleet in July - 3rd Wide Azimuth
Acquisition program proceeding well in the deepwater Gulf of Mexico
(GoM) - Multi-Client after-sales of EUR51 million, ($69 million) in
this typically low quarter - Multi-Client pre-funding level at 80%
- Successful deepwater implementation of Seabed solution in Asia
Pacific - Sercel continued to see significantly strong sales with
especially high land equipment deliveries - Backlog as of July 1st
2007 of $ 1.6 billion Comments and Perspectives: CGGVeritas
Chairman & CEO, Robert Brunck, commented: "I am pleased that
our performance, in the industry's typically slow seasonal quarter,
was inline with our expectations enabling CGGVeritas in our first
six months following the merger to reach our mid year goals.
Supported by continued superior results from Sercel and robust year
on year growth from Services across all of our business lines in
the Eastern and Western Hemisphere, it is clear that CGGVeritas is
off to a strong start in creating the leading Geophysical company.
I was particularly pleased to see the quick take-up and successful
results of our high-end innovative products and services, including
our industry leading wide-azimuth capabilities offshore Gulf of
Mexico and onshore Middle East, our advanced imaging algorithms
worldwide and our first wireless equipment sale. Looking forward,
with the continued strengthening market conditions, and increasing
multi-client sales along with Sercel's continued leadership
performance, I am pleased to say that we expect to exceed our
previously announced 2007 targets." First Half 2007 Financial
Highlights: - Group Revenues of EUR1163 million ($1546 million), up
18% in EUR and 29% in $ - Group EBITDA of EUR468 million ($622
million), and EBITDA margin of 40% compared to EUR389 million,
($476 million), and EBITDA margin of 40% - Group Operating Profit,
including PPA, of EUR244 million ($324 million), a 21% operating
margin compared to EUR180 million ($220 million), a 18% operating
margin - Net Profit of EUR114 million ($151 million), 10% percent
of revenue compared to EUR53 million ($65 million), 5% of revenue -
EPS of EUR4.16 ($5.53) Table of year-on-year Financial Highlight
comparisons: Financial Highlights In million US dollars Second
Second First First Quarter Quarter Half Half 2007 2006 2007 2006
Exchange rate 1.347 1.253 1.329 1.223 Operating revenues 768.7
562.1 1546.0 1201.4 Sercel 264.1 206.4 532.4 351.3 Services 525.3
391.8 1084.1 926.0 Elimination (20.7) (36.1) (70.5) (75.9) Gross
profit 235.9 156.2 506.8 355.6 Operating profit (loss) 135.9 84.7
324.3 220.4 Sercel 90.5 56.6 181.1 91.6 Services 62.1 43.9 195.0
153.6 Corporate and Elimination (16.7) (15.8) (51.8) (24.8) Income
(loss) from equity investments 1.0 3.8 1.6 7.1 EBITDA 283.6 212.0
622.1 475.9 Sercel 97.0 61.3 193.9 101.4 Services 199.0 167.4 475.0
402.6 Net income (loss) 60.4 22.8 151.0 65.3 Industrial Capex &
development costs 64.9 48.4 161.3 145.4 Multi-Client Capex 111.3
75.3 191.9 114.3 Net Debt / Equity gearing ratio 50% N/A 50% N/A
Earnings per share (in Euros) 1.56 0.63 4.16 1.95 Second quarter
revenues: - Group Revenues were EUR571 million, ($769 million) up
28% in EUR and up 37% in $ - Revenues for Services were EUR390
million, ($525 million) up 26% in EUR and up 34% in $, due to
strengthening market conditions, upward price mobility and
partially offset by lower vessel utilization rate - Revenues for
Sercel were EUR196 million ($264 million), up 18 % in EUR and up
28% in $ year on year. Sercel external sales were EUR181 million
($244 million) up 32% in EUR and up 42% in $, year on year Services
revenue breakdown by business line: - Contract revenues: - Land
contract revenues were EUR72 million ($97 million) down 5% in EUR
and stable in $ - Offshore contract revenues were EUR134 million
($180 million) up 48% in EUR and up 57% in $ - Processing and
Reservoir revenues were EUR67 million ($90 million), up 7% in EUR
and 15% in $ - Multi-Client revenues - Total Multi-Client revenues
were EUR117 million ($158 million) up 46% in EUR and up 53% in $ -
Multi-Client land revenues were EUR20 million ($27 million) -
Multi-Client offshore revenues were EUR97 million ($131 million)
Second quarter EBITDA and Operating Profit: Group: - The Group
EBITDA was EUR210 million ($284 million), a 37% EBITDA margin,
compared to EUR168 million ($ 212 million), 38% EBITDA margin - The
Group Operating Profit was EUR101 million ($136 million), a 18%
operating margin, including PPA EUR7 million ($9 million) compared
to EUR66 million ($85 million), including PPA EUR5 million ($6
million), a 15% operating margin Services: - Services EBITDA was
EUR147 million ($199 million), a 38% EBITDA margin compared to
EUR132 million, ($167 million) and a 43% EBITDA margin, mainly due
to increased vessel shipyards for performance upgrade and
maintenance - Services Operating Profit including PPA was EUR46
million ($62 million), a 12% operating margin, compared to EUR34
million ($44 million), a 11% operating margin Sercel: - Sercel
EBITDA was EUR72 million ($97 million) corresponding to a 37%
EBITDA margin, compared to EUR49 million ($61 million), a 30%
EBITDA margin - Sercel Operating Profit was EUR67 million ($91
million), a 34% operating margin, compared to EUR46 million ($57
million), a 27% operating margin Overview of Operations and Market
Outlook: Services: Land Contract Acquisition: The land market
continues to strengthen and during the quarter, we operated 23
crews in average, 9 crews in Western Hemisphere and 14 crews in the
Eastern Hemisphere where our high-density wide-azimuth HPVAtm
continues to gain acceptance. In the third and fourth quarter we
expect strong activity especially in Europe Africa and Middle East
(EAME) and Asia Pacific. Land Multi-Client: During the quarter, 3
crews shot highly pre-funded Multi-Client programs in North America
and data sales continued to be strong especially in the Canadian
Foothills. Offshore Contract Acquisition: During the quarter, five
3D vessels were operating in Asia Pacific, one in EAME and one in
GoM on a wide-azimuth contract. As anticipated, the 3D vessel
utilization rate at 75% was lower than the first quarter mainly
based on the scheduled dry docks for performance upgrade and
maintenance. The utilization rate will be up again in the third and
fourth quarter and two new vessels, the Vision and the Vanquish,
join our fleet, respectively in early July and mid October. The
Seisquest was decommissioned June 9th. Also during the quarter we
successfully implemented a seabed solution offshore Malaysia at a
water depth of over 1000 meters. Multi-Client Offshore:
Approximately 40% of our 3D vessels during the quarter were
dedicated to our Multi-Client library. We operated 5 vessels on
highly pre-funded new Multi-Client programs, in GoM, Brazil and
North Sea. Demand for recent vintage and well located data,
particularly in deep and ultra-deep waters of the GoM, remains
robust and we began shooting a highly pre-funded new wide-azimuth
program in the GoM. We expect Multi-Client after-sales to
strengthen in the second half of the year in line with lease sales
and typical seasonal cycles in the industry. Processing &
Reservoir: Processing activity continued to increase worldwide
driven by marine data volumes especially with the increasing market
take-up of wide-azimuth and the high demand for our advanced
imaging capabilities. Backlog continues to remain strong. Sercel:
During the quarter, Sercel delivered a significantly large volume
of land equipment into an expanding market and increasing demand
for higher channel counts to increase seismic resolution. Marine
equipment sales continue to be at record levels driven by demand
for leading streamer technology and new vessels coming into the
market. Net Income: - The net result was a Profit of EUR45 million
($60 million) compared to a pro-forma Profit of EUR18 million ($23
million) - EPS was EUR1.56 ($2.11) Cash Flow: - During the quarter,
we early reimbursed $100 million of our term loan B senior facility
- The industrial Capex for the second quarter 2007 was EUR47
million ($64 million) compared to pro-forma EUR38 million ($48
million) - The Multi-Client Capex for the second quarter 2007 was
EUR83 million ($111 million) compared to pro-forma EUR62 million
($75 million). The average pre-funding level was 80% Balance Sheet
items: - At the end of June 2007, Shareholder's equity was EUR2.4
billion and net financial debt was EUR 1.2 billion, representing a
50 % net debt to equity ratio CGGVeritas comparison with CGG: This
table provides the CGGVeritas financial results in million euros
for the second quarter and first half of 2007 compared with
historical CGG standalone financial results for the second quarter
and first half of 2006 Financial Results In million Euros Second
Second First Half First Half Quarter Quarter 2007 2006 2007 2006
Exchange rate 1.347 1.253 1.329 1.223 Operating revenues 571.1
312.4 1163.3 634.5 Sercel 196.2 165.8 400.6 287.2 Services 390.1
173.0 815.7 402.9 Elimination (15.2) (26.4) (53.0) (55.6) Operating
profit (loss) 100.5 61.6 244.0 146.1 Sercel 67.3 45.5 136.3 74.9
Services 45.5 27.8 146.7 89.7 Elimination (12.3) (11.7) (39.0)
(18.5) EBITDA 210.2 106.5 468.1 234.3 Sercel 72.1 49.2 145.9 82.9
Services 147.1 69.7 357.4 172.6 Net income (loss) 44.6 29.7 113.6
76.2 Earnings per share (EUR) 1.56 1.69 4.16 4.37 - Group Revenues
were EUR571 million ($769 million) up 83% in EUR and up 96% in $ -
Group Operating Profit was EUR101 million ($136 million), up 65%
compared to EUR62 million ($77 million) - The Net Result was EUR45
million ($60 million) up 50% compared to EUR30 million ($37
million) - EPS was EUR1.56 compared to EPS of EUR1.69 The
information included herein contains certain forward-looking
statements within the meaning of Section 27A of the securities act
of 1933 and section 21E of the Securities Exchange Act of 1934.
These forward-looking statements reflect numerous assumptions and
involve a number of risks and uncertainties as disclosed by the
Company from time to time in its filings with the Securities and
Exchange Commission. Actual results may vary materially. Robert
BRUNCK, Chairman and CEO, will comment on the results during on
August 2nd 2007, a public presentation at 10:00 am, at Palais
Brongniart - Place de la Bourse Paris 2nd arrondissement. An
English language conference call is scheduled also today at 2:30 pm
Paris, 1:30 pm London, 8:30 am US Eastern and 7:30 am US Central
Time. To take part in the conference call, please dial in using the
numbers below 10 minutes prior to the scheduled start time.
International +1-706-758-9607 US +1-800-374-0113 Replay
+1-706-645-9291 & +1-800-642-1687 - code 10746469 You will be
asked for the name of the conference: "CGGVeritas Second Quarter
2007 Results". CGGVeritas will also provide a streaming audio
webcast of the conference call accessible on our web site at
http://www.cggveritas.com/ on a listen-only basis. Please connect
10 minutes prior to the start of the conference to register for the
call and to check your connection is working properly. A replay
will be available on our website for two weeks following the
conference call. The quarterly financial information, including
Press Releases, 6K detailed financial figures and presentation,
will be available on our website at 8 am Paris time on August 2nd.
About CGGVeritas: CGGVeritas (http://www.cggveritas.com/) is a
leading international pure-play geophysical company delivering a
wide range of technologies, services and equipment through Sercel,
to its broad base of customers mainly throughout the global oil and
gas industry. CGGVeritas is listed on the Eurolist of Euronext
Paris SA (ISIN: 0000120164) and the New York Stock Exchange (in the
form of American Depositary Shares, NYSE: CGV). (1) Veritas results
have been incorporated as of January 12th 2007 at the time the
merger was effective. For the purpose of providing the best
understanding of our performance, all results are second quarter
results unless otherwise stated and are compared to pro-forma 2006
figures. 2006 pro-forma figures are pro-forma as if the merger was
effective on January 1st, 2006 and result from the consolidation of
former CGG and former Veritas figures. Our consolidated financial
statements are presented in euros. Converted US$ figures are
presented only to assist you in understanding our operating
revenues are not part of our reported financial statements. The $
figures are calculated based on second quarter EUR/$ average
exchange rate for the Profit & Loss and Cash Flow Statement and
are based on the EUR/$ closing exchange rate for the Balance Sheet.
The comparison in EUR between the CGGVeritas second quarter 2007
results with the second quarter 2006 CGG standalone results is
provided on the page after the balance sheet items. Contacts
Investor Relations: Paris: Christophe Barnini Tel:
+33-1-64-47-38-10 Houston: Hovey Cox Tel: +1-832-351-8821 Press
Contact: Brunswick Tel: +1-212-333-3810 DATASOURCE: CGG Veritas
CONTACT: Contacts Investor Relations: Paris: Christophe Barnini,
Tel: +33-1-64-47-38-10, ; Houston: Hovey Cox, Tel: +1-832-351-8821,
; Press Contact: Brunswick, Tel: +1-212-333-3810
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