Attached files
| file | filename |
|---|---|
| EX-99.3 - EXHIBIT 99.3 - ION GEOPHYSICAL CORP | ioq216segmentslidesmlm.htm |
| EX-99.1 - EXHIBIT 99.1 - ION GEOPHYSICAL CORP | ex991earningsrelease2016-q2.htm |
| 8-K - 8-K - ION GEOPHYSICAL CORP | a8k-2016xq2xearnings.htm |
ION Earnings Call – Q2 2016
Earnings Call Presentation
August 4, 2016
Corporate Participants and Contact Information
CONTACT INFORMATION
If you have technical problems during the call, please contact DENNARD–LASCAR Associates
at 713 529 6600.
If you would like to view a replay of today's call, it will be available via webcast in the Investor Relations
section of the Company's website at www.iongeo.com for approximately 12 months.
BRIAN HANSON
President and
Chief Executive Officer
STEVE BATE
Executive Vice President
and Chief Financial Officer
2
Forward-Looking Statements
The information included herein contains 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.
Actual results may vary fundamentally from those described in these
forward-looking statements.
All forward-looking statements reflect numerous assumptions and involve a
number of risks and uncertainties.
These risks and uncertainties include risk factors that are disclosed by ION
from time to time in its filings with the Securities and Exchange Commission.
3
Revenues $M
4
• Revenues of $36M Q2-16:
• down 2% compared to Q2-15
• up 60% sequentially to Q1-16
• Q2-16 adjusted net loss of $(21)M
compared to $(45)M in Q2-15
• 1H-16 adjusted loss of $(56)M
compared to $(96)M in 1H-15
• Excluding financing activities,
consumed $17M of cash in Q2-16
versus $26M in Q2-15
• Expect to generate moderate level
of cash flows in 2H-16
ION Q2-16 Financial Highlights
(4.07)
(1.85)
$(5.00)
$(4.00)
$(3.00)
$(2.00)
$(1.00)
$-
Q2 Adjusted EPS
Q2-15 Q2-16
(45)
(21)
$(50)
$(40)
$(30)
$(20)
$(10)
$-
Q2 Adjusted Net Loss
Q2-15 Q2-16
(26)
(17)
$(30)
$(20)
$(10)
$-
Q2 Cash Consumption $M
(Excluding Financing)
Q2-15 Q2-16
37
23
36
$-
$10
$20
$30
$40
Q2-15 Q1-16 Q2-16
ION Q2-16 Highlights
Strong Q3 client commitments – over
$60M Q3-16 committed revenues
(exceeds 1H-16 total revenues)
General industry consensus down
cycle has hit bottom – early signs of
recovery
Seeing increasing client value for data
5
Overall Software Segment
Solutions Segment
License rounds represent opportunity
for ION’s multi-client, imaging and
advisory services
Slight resurgence of interest in NA land
Dedicated imaging services capacity to
large 3D reprocessing projects in GoM
Solidified ION’s position as leader in 4D
project optimization
ION awarded all five 4D optimization
jobs in Norwegian Continental Shelf,
UK Continental Shelf and Danish
sector
Marlin gaining traction – deployed in 17
locations
Ocean Bottom Segment
Uptick in project awards
OceanGeo survey offshore Nigeria
underway
Solid production and data quality
Working on additional tenders for work
in the region
(4.07)
(1.85)
$(5.00)
$(4.00)
$(3.00)
$(2.00)
$(1.00)
$-
Adjusted EPS
Q2-15
6
ION Financial Overview
Q2-16 Summary
$-
$10
$20
$30
$40
Q2-15 Q2-16
Software
Systems Solutions
Revenue $M • Revenues down 2% vs Q2-15
• Solutions down 17%
• Software down 34%
• Systems down 14%
• Ocean Bottom $6M in revenues
• Revenues up 60% vs Q1-16
• Loss from operations of $(15)M
compared to $(39)M in Q2-15
• Margin improvement driven by
positive impact of cost savings
initiatives
• Adjusted EPS of $(1.85) compared
to $(4.07) in Q2-15
• Adjusted EBITDA of $(3)M
compared to $(29)M in Q2-15
Ocean Bottom
Q2-16
$(39)
$(15)
$(50)
$(40)
$(30)
$(20)
$(10)
$-
Q2-16
Adjusted Operating Loss $M
Q2-15
$(29)
$(3)
$(30)
$(25)
$(20)
$(15)
$(10)
$(5)
$-
Q2-15 Q2-16
Adjusted EBITDA $M
ION Financial Overview
Cash Flow $M
7
• Consumed cash before
financing activities of
$17M, compared to
$26M Q2-15
• Total liquidity of $64M
at June 2016
• $52M of cash, including
$15M of revolver
borrowings
• $12M additional
availability on revolver
• Cash balances as
expected given slow
start to the year
• Revolving credit
availability to increase
with expected revenues
increase in 2H-16
Q2-15 Q2-16 1H-15 1H-16
Net income (loss) 55.8$ (25.3)$ 0.3$ (60.3)$
Non-cash adjustments (88.8) 16.2 (75.5) 29.8
Working capital 17.2 (5.8) 52.7 18.2
Cash from operations (15.8) (14.8) (22.5) (12.3)
Multi-client investment (4.5) (2.3) (13.6) (8.6)
PP&E capital expenditures (5.2) (0.1) (17.2) (0.3)
Other investing activities - - 0.3 -
Net cash from investing activities (9.7) (2.4) (30.6) (9.0)
Payment to repurchase bonds - (15.0) - (15.0)
Costs associated with issuance of debt - (4.9) - (6.2)
Repurchase of common stock - - - (1.0)
Borrowings under revolving credit facility - 15.0 - 15.0
ther financing activities (1.5) (2.6) (3.5) (4.8)
Net cash fro financing activities (1.5) (7.4) (3.5) (11.9)
Effect of change n f/x (0.4) 0.4 - 0.7
Net Change i Cash (27.3) (24.2) (56.5) (32.5)
Cash & cash equiv. (beg. of period) 144.4 76.7 173.6 84.9
Cash & cash equiv. (end of period) 117.1$ 52.4$ 117.1$ 52.4$
Summary
Expect continued sequential improvement in 2H-16
– Completion of OBS Nigeria survey in Q3
– Repair & replacement and software recurring revenue streams
– Industry-funded new venture programs in southern GoM
– Traditional year-end spending on data library programs
Strong Q3 commitments
Expect to generate net cash flows in second half of 2016
Expect positive working capital second half of 2016, providing
liquidity into 2017 and restoring borrowing base of revolver
8
FRONTIER EXPLORATION EXPLORATION APPRAISAL & DEVELOPMENT PRODUCTION
E&P
Operations
Optimization
OPTIMIZATION SOFTWARE AND SERVICES
ION sof tware and serv ices for des ign, execut ion and opt im izat ion
o f complex operat ions ac ross a wide range o f mar i t ime ac t iv i t ies
SEISMIC DATA ACQUISITION DEVICES
St reamer pos i t ion ing and cont ro l sys tems for o f f shore se ism ic data acqu is i t ion
IMAGING SERVICES
One of the mos t technolog ica l l y advanced se ism ic data process ing & imaging teams in the indus t ry
FULL-SCOPE OBS SERVICES
S urvey p l ann ing & des i gn , da ta acqu i s i t i on
t h rough OceanG eo , and im ag ing and
i n te rp r e ta t i on de l i ve r supe r i o r OB S da ta t o he l p
o i l & gas com pan ies ga i n i ns i gh t s f o r rese rvo i r
deve lopm en t dec i s i ons
MULTI-CLIENT PROGRAMS / DATA LIBRARY
2D and 3D m u l t i - c l i en t and p rop r i e ta r y p rog ram s . G loba l
Bas inSPAN™ l i b ra ry o f ~500 ,000 km o f bas i n -w ide , deep ,
geo log i ca l l y - d r i v e n 2D m u l t i - c l i en t se i sm i c da ta
E&P ADVISORS
Extens ive g loba l exper ience to de l i ver fu l l -va lue-cha in commerc ia l and
techn ica l so lu t ions to the o i l & gas indus t ry wor ldwide
E&P
Technology
& Services
Ocean Bottom
Services
New Financial Reporting Segments
Starting Q3-16
9
10
Q&A
