October 9, 2020: Oslo, Norway, based on a preliminary review, PGS expects to
report Segment* revenues for Q3 2020 of approximately $115 million. Contract
revenues ended at approximately $9 million. MultiClient pre-funding revenues
were approximately $52 million, from a capitalized MultiClient cash investment
of approximately $57 million. MultiClient late sales were approximately $26
million.
Q3 2020 revenues include approximately $23 million of government grants related
to the Covid-19 pandemic. The government grants are recorded as Other revenues.
"A majority of our active vessel capacity was allocated to MultiClient in Q3.
The market remains challenging, but we believe this quarter represents the
trough of this Covid-19 driven downturn. We expect increasing revenues from
vessel operations and MultiClient sales going forward.
During the quarter, we completed our reorganization to adapt to the challenging
market environment. We are now down to an annual run rate gross cash cost of
approximately $400 million, assuming five vessels in operation. The process to
complete documentation with lenders on the agreement to extend maturities is
progressing according to plan", says President & CEO Rune Olav Pedersen.
PGS routinely releases information about 3D vessel utilization after the end of
each quarter.
Summary of vessel utilization:
+-------------------------------------------+-----------+----------------------+
| | | |
| | | |
|Approximate allocation of PGS operated 3D | Quarter | |
|towed streamer capacity | ended | |
| | September | |
| | 30, |Quarter ended June 30,|
+-------------------------------------------+-----+-----+----------------------+
| |2020 |2019 | 2020 |
+-------------------------------------------+-----+-----+----------------------+
|Contract seismic | 2%| 32%| 15%|
+-------------------------------------------+-----+-----+----------------------+
|MultiClient seismic |69% | 56%| 50%|
+-------------------------------------------+-----+-----+----------------------+
|Steaming | 11%| 12%| 21%|
+-------------------------------------------+-----+-----+----------------------+
|Yard | 7%| 0%| 0%|
+-------------------------------------------+-----+-----+----------------------+
|Stacked/Standby | 11%| 0%| 14%|
+-------------------------------------------+-----+-----+----------------------+
The Q3 2020 vessel statistics includes five vessels. All cold-stacked** vessels
are excluded from the statistics. The comparative periods (Q3 2019 and Q2 2020)
are based on eight vessels.
The Company provides this information based on a preliminary summary of Q3 2020
revenues. The Company has not completed its financial reporting and related
consolidation, review and control procedures, including the final 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 Q3
2020 financial statements finally approved and released by the Company may
deviate from the information herein.
PGS will release its Q3 2020 financial statements on Thursday October 22, 2020,
at approximately 8:00am Central European Summer Time (CEST). A corresponding
presentation is scheduled for 09:00am CEST the same day.
((*For the purpose of Segment reporting, MultiClient prefunding revenues are
recognized on a percentage of completion basis, and the related amortization of
MultiClient library is based upon the ratio of aggregate capitalized survey
costs to forecasted sales. This differs from IFRS reporting which recognizes
revenue from MultiClient prefunding agreements and related amortization at the
"point in time" when the customer receives access to, or delivery of, the
finished data. For further description of the principles applied, see details in
the 2019 annual report.))
((**The term "cold-stacked" is used when a vessel is taken out of operation for
an extended period of time. Costs are reduced to a minimum, with the vessel
preserved for a long idle time, all or most in-sea seismic equipment removed
from the vessel, and typically the Company does not have available crew to
operate the vessel. ))
FOR DETAILS, CONTACT:
Bård Stenberg, VP IR & Corporate Communication
Mobile: +47 99 24 52 35
***
PGS 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
(http://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 2019. 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.
--END--