Weak Q1 2019 Results - Full Year Intact
April 8, 2019: Oslo, Norway, based on a preliminary review of Q1 2019 sales, PGS (or "the Company") expects to report Segment revenues of approximately $142 million and a Segment EBITDA of approximately $65 million.
Total Segment MultiClient revenues for Q1 2019 are estimated to approximately $90 million. As communicated earlier, the Q1 2019 MultiClient acquisition activity was high in the quarter, but with a lower than average prefunding level.
PGS is targeting a prefunding level in the range of 80-120%. In the Company's MultiClient portfolio, there are significant variations of prefunding levels on individual surveys. In Q1 2019, the mix of MultiClient surveys had an overweight of surveys with low prefunding. Prefunding revenues ended at approximately $30 million, 50% of approximately $60 million MultiClient cash investment. For the full year 2019, PGS expects the prefunding level to be in the upper half of the targeted range of 80-120%.
MultiClient late sales are estimated at approximately $60 million in Q1 2019.
The order book as of March 31, 2019 was approximately $240 million, compared to $163 million at December 31, 2018. Pricing for 2019 contract work booked to date remains strong and is now more than 35% higher than the average rate in 2018.
"Our Q1 numbers reflect the seasonal distribution of 2019 MultiClient investment activities, as we had and overweight of low prefunded MultiClient projects in the first quarter. This will reverse in the coming quarters and the prefunding level for the full year 2019 is expected to be in the upper half of the targeted range of 80-120%. The seismic market is recovering and during the first quarter we have significantly improved the visibility of vessel utilization, MultiClient pre-funding and contract revenues with an increase in the order book of almost 50%," says President & CEO Rune Olav Pedersen.
Segment EBITDA, when used by the Company, means Segment EBIT excluding other charges, impairment and loss on sale of long-term assets and depreciation and amortization. Reference is made to the definitions of Segment EBITDA and other alternative performance measures in the Company's annual and quarterly reports.
The Company provides this information based on a preliminary summary of Q1 2019 numbers. The Company has not completed its financial reporting and related consolidation, review and control procedures, including the review of all sales against the established revenue recognition/cut-off criteria. The estimates provided in this release are therefore subject to change and the Q1 2019 financial statements finally approved and released by the Company may deviate materially from the information herein.
PGS will report Q1 2019 results on April 25, 2019.
FOR DETAILS, CONTACT:
Bård Stenberg, VP IR & Corporate Communications
Phone: +47 67 51 43 16
Mobile: +47 99 24 52 35
Petroleum Geo-Services ASA and its subsidiaries ("PGS" or "the Company") is a focused marine geophysical company that provides a broad range of seismic and reservoir services, including acquisition, imaging, interpretation, and field evaluation. The Company MultiClient data library is among the largest in the seismic industry, with modern 3D coverage in all significant offshore hydrocarbon provinces of the world. The Company operates on a worldwide basis with headquarters in Oslo, Norway and the PGS share is listed on the Oslo stock exchange (OSE: PGS). For more information on PGS visit www.pgs.com.
The information included herein contains certain forward-looking statements that address activities, events or developments that the Company expects, projects, believes or anticipates will or may occur in the future. These statements are based on various assumptions made by the Company, which are beyond its control and are subject to certain additional risks and uncertainties. The Company is subject to a large number of risk factors including but not limited to the demand for seismic services, the demand for data from our multi-client data library, the attractiveness of our technology, unpredictable changes in governmental regulations affecting our markets and extreme weather conditions. For a further description of other relevant risk factors we refer to our Annual Report for 2018. As a result of these and other risk factors, actual events and our actual results may differ materially from those indicated in or implied by such forward-looking statements. The reservation is also made that inaccuracies or mistakes may occur in the information given above about current status of the Company or its business. Any reliance on the information above is at the risk of the reader, and PGS disclaims any and all liability in this respect.