HOUSTON, July 31, 2019 /PRNewswire/ -- ION Geophysical
Corporation (NYSE: IO) today reported total net revenues of
$41.8 million in the second quarter
2019, a 69% increase compared to total net revenues of $24.7 million one year ago, driven primarily by a
significant increase in data library sales, an increase in marine
equipment replacement and repair revenues, and continued increases
in Marlin™ deployments. ION's net loss was $8.6 million, or a loss of $0.61 per share, compared to a net loss of
$25.9 million, or a loss of
$1.86 per share in the second quarter
2018. Excluding special items in both periods, the Company
reported an Adjusted net loss of $8.3
million, or a loss of $0.59
per share, compared to an Adjusted net loss of $23.4 million, or a loss of $1.68 per share in the second quarter 2018.
A reconciliation of special items to the reported financial results
can be found in the tables of this press release.
The Company reported Adjusted EBITDA of $7.3 million for the second quarter 2019, an
increase from the Adjusted EBITDA of $(7.9)
million one year ago. A reconciliation of Adjusted
EBITDA to the closest comparable GAAP numbers can be found in the
tables of this press release.
Net cash flows from operations were $(1.1) million during the second quarter 2019,
compared to $(0.8) million in the
second quarter 2018. Total net cash flows, including
investing and financing activities, were $(8.9) million, compared to $(6.4) million one year ago. At
June 30, 2019, the Company had total
liquidity of $67.6 million,
consisting of $29.6 million of cash
on hand and $38.0 million of
available borrowing capacity under its $50.0
million revolving credit facility, of which nothing was
drawn during the first six months of 2019.
"We had a strong quarter, especially given the continued fiscal
discipline among E&P operators," stated Chris Usher, ION's President and Chief Executive
Officer. "Our revenues and earnings were up significantly
both year-on-year and sequentially. As expected, we had very
focused engagement from our E&P clients on targeted exploration
programs primarily in North and South America. While 2019
E&P spending levels are projected to be up slightly, it
continues to be unclear how robust exploration activity and funding
will be this year. However, we remain cautiously optimistic
given the uptick in backlog since the end of last year and the new
venture interest we're seeing. Indications from our customers
are that the towed streamer space is experiencing modest
improvement, while the ocean bottom segment is continuing to expand
with strong double digit growth.
"I'm also pleased with our management transition. We are
well aligned and committed to accelerate progress executing our
strategy. We sanctioned six new multi-client programs so far
this year. We also made significant headway on the
commercialization of 4Sea™ and SailWing™, which target one of the
real growth segments in our industry. We signed a memorandum
of understanding with iSEISMIC to deploy the complete 4Sea next
generation ocean bottom system. In addition, we leased our
first SailWing system and new rechargeable battery technology under
recurring revenue business models. We are also continuing to
expand and enhance our Marlin offshore operations optimization
software for both E&P and adjacent markets. Our
Optimization Services revenues were at an all-time high, driven by
Marlin deployments. The Marlin SmartPort™ pilot in the UK is
progressing nicely. It's a major digital transformation
effort that will take the client from paper, radio and physical
whiteboard operations management to a holistic digital capability
that will give them a competitive edge over other ports. The
opportunity for ION, with thousands of ports worldwide, is quite
exciting."
For the first half of 2019, the Company reported total net
revenues of $78.7 million, a 35%
increase compared to total net revenues of $58.3 million one year ago. ION's net loss
was $30.0 million, or a loss of
$2.13 per share, compared to a net
loss of $44.3 million, or a loss of
$3.31 per share in the first half of
2018. Excluding special items in both periods, the Company
reported an Adjusted net loss of $25.2
million, or a loss of $1.79
per share, compared to an Adjusted net loss of $40.6 million, or a loss of $3.03 per share in the first half of 2018.
Adjusted EBITDA was $7.1 million in
the first half of 2019, compared to $(7.8)
million one year ago.
Net cash flows from operations were $14.3
million, compared to $(0.2)
million in the first half of 2018. Total net cash
flows, including investing and financing activities, were
$(4.0) million in the first half of
2019, compared to $(7.7) million one
year ago.
SECOND QUARTER 2019
The Company's segment revenues for the second quarter were as
follows (in thousands):
|
|
Three Months Ended
June 30,
|
|
|
|
|
2019
|
|
2018
|
|
% Change
|
E&P Technology
& Services
|
|
$
|
28,523
|
|
|
$
|
15,188
|
|
|
88
|
%
|
Operations
Optimization
|
|
13,252
|
|
|
9,555
|
|
|
39
|
%
|
Total
|
|
$
|
41,775
|
|
|
$
|
24,743
|
|
|
69
|
%
|
Within the E&P Technology & Services segment,
multi-client revenues were $22.8
million, an increase of 132%. Data library revenues
increased 932% and new venture revenues declined by 38% compared to
the second quarter 2018. The increase in data library
revenues came from diverse geographic areas in North and South
America. The decrease in new venture revenue was primarily
due to the timing of new programs. Imaging Services revenues
were $5.7 million, an increase of
7%. While Imaging Services revenues modestly increased, a
significant number of new projects closed during the quarter,
further increasing Imaging Services backlog to its highest level
since 2015. This increase in backlog should lead to an
increase in Imaging Services revenues during the remainder of
2019.
Within the Operations Optimization segment, Optimization
Software & Services revenues were $5.7
million, a 19% increase from the second quarter 2018 due to
an increase in deployments and associated engineering services of
ION's Marlin offshore operations optimization software.
Devices revenues were $7.5 million, a
58% increase from the second quarter 2018, driven by an increase in
marine equipment replacement and repairs.
Consolidated gross margin for the quarter was 47%, compared to
(6)% in the second quarter 2018. Gross margin in E&P
Technology & Services was 43%, compared to (32)% one year
ago. The improved E&P Technology & Services gross
margin was a result of both an increase in and more favorable mix
of data library revenues. Operations Optimization gross
margin was 55%, compared to 52% one year ago. The increase in
Operations Optimization gross margin was due to the increase in
revenues.
Consolidated operating expenses were $22.1 million, compared to $21.0 million, and operating margin was (6)%,
compared to (91)% in the second quarter 2018. Excluding
special items, consolidated operating expenses, as adjusted, were
$21.8 million, compared to
$18.5 million, and operating margin,
as adjusted, was (5)%, compared to (81)% in the second quarter
2018. The increase in operating expenses, as adjusted, was
due in part to an increase in research and development and
compensation expenses. The improvement in operating margin,
as adjusted, was due to the increase in revenues, partially offset
by the increase in operating expenses, as adjusted.
YEAR-TO-DATE 2019
The Company's segment revenues for the first six months of the
year were as follows (in thousands):
|
|
Six Months Ended June
30,
|
|
|
|
|
2019
|
|
2018
|
|
% Change
|
E&P Technology
& Services
|
|
$
|
55,626
|
|
|
$
|
39,756
|
|
|
40
|
%
|
Operations
Optimization
|
|
23,105
|
|
|
18,495
|
|
|
25
|
%
|
Total
|
|
$
|
78,731
|
|
|
$
|
58,251
|
|
|
35
|
%
|
Within the E&P Technology & Services segment,
multi-client revenues were $46.2
million, an increase of 57%. Data library revenues
increased 262% and new venture revenues declined 15% compared to
the first half of 2018. Imaging Services revenues were
$9.4 million, a decrease of 8%.
The change in revenues during the first six months is fairly
consistent with the changes described in the foregoing section.
Within the Operations Optimization segment, Optimization
Software & Services revenues were $10.8
million, a 12% increase from the first half of 2018.
Devices revenues were $12.4 million,
a 38% increase from the first half of 2018. The change
in revenues during the first six months is fairly consistent with
the changes described in the foregoing section.
Consolidated gross margin for the six months was 37%, compared
to 9% in the first half of 2018. Gross margin in E&P
Technology & Services was 32%, compared to (1)% one year
ago. The improved E&P Technology & Services gross
margin was a result of both an increase in and more favorable mix
of data library revenues. Operations Optimization gross
margin was 51%, compared to 50% one year ago.
Consolidated operating expenses were $48.0 million, compared to $40.5 million, and operating margin was (23)%,
compared to (60)% in the first half of 2018. Excluding
special items, consolidated operating expenses, as adjusted, were
$43.2 million, compared to
$36.8 million, and operating margin,
as adjusted, was (17)%, compared to (54)% in the first half of
2018. The improvement in operating margin, as adjusted, was
primarily due to the significant increase in second quarter
revenues, partially offset by an increase in operating expenses, as
adjusted, related to increased research and development and
compensation expenses.
CONFERENCE CALL
The Company has scheduled a conference call for Thursday, August 1, 2019, at 10:00 a.m. Eastern Time that will include a slide
presentation to be posted in the Investor Relations section of the
ION website by 9:00 a.m. Eastern
Time. To participate in the conference call, dial
(877) 407-0672 at least 10 minutes before the call begins and ask
for the ION conference call. A replay of the call will be
available approximately two hours after the live broadcast ends and
will be accessible until August 15,
2019. To access the replay, dial (877) 660-6853 and use pass
code 13691773#.
Investors, analysts and the general public will also have the
opportunity to listen to the conference call live over the Internet
by visiting www.iongeo.com. An archive of the webcast will be
available shortly after the call on the Company's website.
About ION
ION develops and leverages innovative technologies, creating
value through data capture, analysis and optimization to enhance
critical decision-making, enabling superior returns. For more
information, visit iongeo.com.
Contact
Steve Bate
Executive Vice President and Chief Financial Officer
+1.281.552.3011
The information 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 may include information and other
statements that are not of historical fact. Actual results may vary
materially 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 the risks associated with the
timing and development of ION Geophysical Corporation's products
and services; pricing pressure; decreased demand; changes in oil
prices; and political, execution, regulatory, and currency risks.
These risks and uncertainties also include risks associated with
the WesternGeco litigation and other related proceedings. We cannot
predict the outcome of this litigation or the related proceedings.
For additional information regarding these various risks and
uncertainties, including the WesternGeco litigation, see our Form
10-K for the year ended December 31,
2018, filed on February 7,
2019. Additional risk factors, which could affect actual
results, are disclosed by the Company in its filings with the
Securities and Exchange Commission ("SEC"), including its Form
10-K, Form 10-Qs and Form 8-Ks filed during the year. The Company
expressly disclaims any obligation to revise or update any
forward-looking statements.
Tables to follow
ION GEOPHYSICAL
CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(In thousands,
except per share data)
|
(Unaudited)
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Service
revenues
|
$
|
30,407
|
|
|
$
|
15,752
|
|
|
$
|
58,535
|
|
|
$
|
40,838
|
|
Product
revenues
|
11,368
|
|
|
8,991
|
|
|
20,196
|
|
|
17,413
|
|
Total net
revenues
|
41,775
|
|
|
24,743
|
|
|
78,731
|
|
|
58,251
|
|
Cost of
services
|
16,795
|
|
|
22,033
|
|
|
39,241
|
|
|
44,362
|
|
Cost of
products
|
5,397
|
|
|
4,227
|
|
|
9,995
|
|
|
8,553
|
|
Gross profit
(loss)
|
19,583
|
|
|
(1,517)
|
|
|
29,495
|
|
|
5,336
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Research, development
and engineering
|
5,186
|
|
|
4,259
|
|
|
10,543
|
|
|
8,514
|
|
Marketing and
sales
|
6,060
|
|
|
6,007
|
|
|
11,853
|
|
|
11,105
|
|
General,
administrative and other operating expenses
|
10,890
|
|
|
10,736
|
|
|
25,589
|
|
|
20,876
|
|
Total operating
expenses
|
22,136
|
|
|
21,002
|
|
|
47,985
|
|
|
40,495
|
|
Loss from
operations
|
(2,553)
|
|
|
(22,519)
|
|
|
(18,490)
|
|
|
(35,159)
|
|
Interest expense,
net
|
(3,111)
|
|
|
(2,911)
|
|
|
(6,223)
|
|
|
(6,747)
|
|
Other income
(expense), net
|
96
|
|
|
84
|
|
|
(696)
|
|
|
(707)
|
|
Loss before income
taxes
|
(5,568)
|
|
|
(25,346)
|
|
|
(25,409)
|
|
|
(42,613)
|
|
Income tax
expense
|
2,719
|
|
|
154
|
|
|
4,126
|
|
|
1,226
|
|
Net loss
|
(8,287)
|
|
|
(25,500)
|
|
|
(29,535)
|
|
|
(43,839)
|
|
Less: Net income
attributable to noncontrolling interest
|
(335)
|
|
|
(366)
|
|
|
(447)
|
|
|
(453)
|
|
Net loss attributable
to ION
|
$
|
(8,622)
|
|
|
$
|
(25,866)
|
|
|
$
|
(29,982)
|
|
|
$
|
(44,292)
|
|
Net loss per
share:
|
|
|
|
|
|
|
|
Basic
|
$
|
(0.61)
|
|
|
$
|
(1.86)
|
|
|
$
|
(2.13)
|
|
|
$
|
(3.31)
|
|
Diluted
|
$
|
(0.61)
|
|
|
$
|
(1.86)
|
|
|
$
|
(2.13)
|
|
|
$
|
(3.31)
|
|
Weighted average
number of common shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
14,098
|
|
|
13,928
|
|
|
14,065
|
|
|
13,374
|
|
Diluted
|
14,098
|
|
|
13,928
|
|
|
14,065
|
|
|
13,374
|
|
ION GEOPHYSICAL
CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED
BALANCE SHEETS
|
(In
thousands)
|
(Unaudited)
|
|
ASSETS
|
June 30,
2019
|
|
December 31,
2018
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
29,563
|
|
|
$
|
33,551
|
|
Accounts receivable,
net
|
17,603
|
|
|
26,128
|
|
Unbilled
receivables
|
22,524
|
|
|
44,032
|
|
Inventories,
net
|
13,393
|
|
|
14,130
|
|
Prepaid expenses and
other current assets
|
7,754
|
|
|
7,782
|
|
Total current
assets
|
90,837
|
|
|
125,623
|
|
Deferred income tax
asset, net
|
7,659
|
|
|
7,191
|
|
Property, plant and
equipment, net
|
13,114
|
|
|
13,041
|
|
Multi-client data
library, net
|
66,461
|
|
|
73,544
|
|
Goodwill
|
22,907
|
|
|
22,915
|
|
Right-of-use
assets
|
39,926
|
|
|
47,803
|
|
Other
assets
|
1,517
|
|
|
2,435
|
|
Total
assets
|
$
|
242,421
|
|
|
$
|
292,552
|
|
LIABILITIES AND
(DEFICIT) EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Current maturities of
long-term debt
|
$
|
1,376
|
|
|
$
|
2,228
|
|
Accounts
payable
|
36,399
|
|
|
34,913
|
|
Accrued
expenses
|
32,243
|
|
|
31,411
|
|
Accrued multi-client
data library royalties
|
16,469
|
|
|
29,256
|
|
Deferred
revenue
|
4,386
|
|
|
7,710
|
|
Current maturities of
operating lease liabilities
|
11,820
|
|
|
12,214
|
|
Total current
liabilities
|
102,693
|
|
|
117,732
|
|
Long-term debt, net
of current maturities
|
119,445
|
|
|
119,513
|
|
Operating lease
liabilities, net of current maturities
|
38,063
|
|
|
45,592
|
|
Other long-term
liabilities
|
1,601
|
|
|
1,891
|
|
Total
liabilities
|
261,802
|
|
|
284,728
|
|
(Deficit)
Equity:
|
|
|
|
Common
stock
|
142
|
|
|
140
|
|
Additional paid-in
capital
|
954,904
|
|
|
952,626
|
|
Accumulated
deficit
|
(956,074)
|
|
|
(926,092)
|
|
Accumulated other
comprehensive loss
|
(20,412)
|
|
|
(20,442)
|
|
Total stockholders'
(deficit) equity
|
(21,440)
|
|
|
6,232
|
|
Noncontrolling
interest
|
2,059
|
|
|
1,592
|
|
Total (deficit)
equity
|
(19,381)
|
|
|
7,824
|
|
Total liabilities and
(deficit) equity
|
$
|
242,421
|
|
|
$
|
292,552
|
|
ION GEOPHYSICAL
CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(In
thousands)
|
(Unaudited)
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
Net loss
|
$
|
(8,287)
|
|
|
$
|
(25,500)
|
|
|
$
|
(29,535)
|
|
|
$
|
(43,839)
|
|
Adjustments to
reconcile net loss to cash provided by (used in) operating
activities:
|
|
|
|
|
|
|
|
Depreciation and
amortization (other than multi-client data library)
|
1,063
|
|
|
2,255
|
|
|
2,098
|
|
|
4,778
|
|
Amortization of
multi-client data library
|
8,296
|
|
|
9,764
|
|
|
19,396
|
|
|
19,557
|
|
Stock-based
compensation expense
|
1,538
|
|
|
1,231
|
|
|
2,831
|
|
|
2,043
|
|
Deferred income
taxes
|
931
|
|
|
(1,749)
|
|
|
(467)
|
|
|
(1,866)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
Accounts
receivable
|
11,604
|
|
|
13,980
|
|
|
8,734
|
|
|
3,896
|
|
Unbilled
receivables
|
(7,923)
|
|
|
3,094
|
|
|
21,575
|
|
|
24,013
|
|
Inventories
|
654
|
|
|
(281)
|
|
|
735
|
|
|
(445)
|
|
Accounts payable,
accrued expenses and accrued royalties
|
(4,041)
|
|
|
(474)
|
|
|
(6,054)
|
|
|
(10,629)
|
|
Deferred
revenue
|
(3,004)
|
|
|
(2,826)
|
|
|
(3,337)
|
|
|
(445)
|
|
Other assets and
liabilities
|
(1,964)
|
|
|
(306)
|
|
|
(1,711)
|
|
|
2,733
|
|
Net cash provided by
(used in) operating activities
|
(1,133)
|
|
|
(812)
|
|
|
14,265
|
|
|
(204)
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
Investment in
multi-client data library
|
(6,015)
|
|
|
(4,542)
|
|
|
(14,782)
|
|
|
(13,782)
|
|
Purchase of property,
plant and equipment
|
(605)
|
|
|
(363)
|
|
|
(1,412)
|
|
|
(424)
|
|
Net cash used in
investing activities
|
(6,620)
|
|
|
(4,905)
|
|
|
(16,194)
|
|
|
(14,206)
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
Payments under
revolving line of credit
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,000)
|
|
Payments on notes
payable and long-term debt
|
(691)
|
|
|
(555)
|
|
|
(1,406)
|
|
|
(29,699)
|
|
Net proceeds from
issuance of stock
|
—
|
|
|
—
|
|
|
—
|
|
|
47,219
|
|
Dividend payment to
noncontrolling interest
|
—
|
|
|
(200)
|
|
|
—
|
|
|
(200)
|
|
Other financing
activities
|
(312)
|
|
|
(306)
|
|
|
(551)
|
|
|
(881)
|
|
Net cash (used in)
provided by financing activities
|
(1,003)
|
|
|
(1,061)
|
|
|
(1,957)
|
|
|
6,439
|
|
Effect of change in
foreign currency exchange rates on cash, cash equivalents and
restricted cash
|
(183)
|
|
|
377
|
|
|
(102)
|
|
|
264
|
|
Net decrease in cash,
cash equivalents and restricted cash
|
(8,939)
|
|
|
(6,401)
|
|
|
(3,988)
|
|
|
(7,707)
|
|
Cash, cash
equivalents and restricted cash at beginning of period
|
38,805
|
|
|
51,113
|
|
|
33,854
|
|
|
52,419
|
|
Cash, cash
equivalents and restricted cash at end of period
|
$
|
29,866
|
|
|
$
|
44,712
|
|
|
$
|
29,866
|
|
|
$
|
44,712
|
|
The following table is a reconciliation of cash and cash
equivalents to total cash, cash equivalents and restricted
cash:
|
June
30,
|
|
2019
|
|
2018
|
Cash and cash
equivalents
|
$
|
29,563
|
|
|
$
|
44,349
|
|
Restricted cash
included in prepaid expenses and other current assets
|
303
|
|
|
60
|
|
Restricted cash
included in other long-term assets
|
—
|
|
|
303
|
|
Total cash, cash
equivalents and restricted cash shown in statements of cash
flows
|
$
|
29,866
|
|
|
$
|
44,712
|
|
ION GEOPHYSICAL
CORPORATION AND SUBSIDIARIES
|
SUMMARY OF SEGMENT
INFORMATION
|
(In
thousands)
|
(Unaudited)
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
Net
revenues:
|
|
|
|
|
|
|
|
|
E&P Technology
& Services:
|
|
|
|
|
|
|
|
|
New
Venture
|
$
|
5,018
|
|
|
$
|
8,125
|
|
|
$
|
18,489
|
|
|
$
|
21,851
|
|
|
Data
Library
|
17,794
|
|
|
1,725
|
|
|
27,742
|
|
|
7,673
|
|
|
Total multi-client
revenues
|
22,812
|
|
|
9,850
|
|
|
46,231
|
|
|
29,524
|
|
|
Imaging
Services
|
5,711
|
|
|
5,338
|
|
|
9,395
|
|
|
10,232
|
|
|
Total
|
28,523
|
|
|
15,188
|
|
|
55,626
|
|
|
39,756
|
|
|
Operations
Optimization:
|
|
|
|
|
|
|
|
|
Devices
|
7,532
|
|
|
4,761
|
|
|
12,352
|
|
|
8,919
|
|
|
Optimization Software
& Services
|
5,720
|
|
|
4,794
|
|
|
10,753
|
|
|
9,576
|
|
|
Total
|
13,252
|
|
|
9,555
|
|
|
23,105
|
|
|
18,495
|
|
|
Total net
revenues
|
$
|
41,775
|
|
|
$
|
24,743
|
|
|
$
|
78,731
|
|
|
$
|
58,251
|
|
|
Gross profit
(loss):
|
|
|
|
|
|
|
|
|
E&P Technology
& Services
|
$
|
12,357
|
|
|
$
|
(4,856)
|
|
|
$
|
17,797
|
|
|
$
|
(513)
|
|
|
Operations
Optimization
|
7,226
|
|
|
4,933
|
|
|
11,698
|
|
|
9,244
|
|
|
Segment gross
profit
|
19,583
|
|
|
77
|
|
|
29,495
|
|
|
8,731
|
|
|
Other
(a)
|
—
|
|
|
(1,594)
|
|
(a)
|
—
|
|
|
(3,395)
|
|
(a)
|
Total gross profit
(loss)
|
$
|
19,583
|
|
|
$
|
(1,517)
|
|
|
$
|
29,495
|
|
|
$
|
5,336
|
|
|
Gross
margin:
|
|
|
|
|
|
|
|
|
E&P Technology
& Services
|
43
|
%
|
|
(32)
|
%
|
|
32
|
%
|
|
(1)
|
%
|
|
Operations
Optimization
|
55
|
%
|
|
52
|
%
|
|
51
|
%
|
|
50
|
%
|
|
Segment gross
margin
|
47
|
%
|
|
—
|
%
|
|
37
|
%
|
|
15
|
%
|
|
Other
|
—
|
%
|
|
(6)
|
%
|
|
—
|
%
|
|
(6)
|
%
|
|
Total gross
margin
|
47
|
%
|
|
(6)
|
%
|
|
37
|
%
|
|
9
|
%
|
|
Income (loss) from
operations:
|
|
|
|
|
|
|
|
|
E&P Technology
& Services
|
$
|
5,237
|
|
|
$
|
(10,206)
|
|
|
$
|
3,622
|
|
|
$
|
(11,000)
|
|
|
Operations
Optimization
|
2,644
|
|
|
1,243
|
|
|
2,814
|
|
|
2,029
|
|
|
Support and
other
|
(10,434)
|
|
(b)
|
(13,556)
|
|
(b)
|
(24,926)
|
|
(c)
|
(26,188)
|
|
(c)
|
Loss from
operations
|
(2,553)
|
|
|
(22,519)
|
|
|
(18,490)
|
|
|
(35,159)
|
|
|
Interest expense,
net
|
(3,111)
|
|
|
(2,911)
|
|
|
(6,223)
|
|
|
(6,747)
|
|
|
Other income
(expense), net
|
96
|
|
|
84
|
|
|
(696)
|
|
|
(707)
|
|
|
Loss before income
taxes
|
$
|
(5,568)
|
|
|
$
|
(25,346)
|
|
|
$
|
(25,409)
|
|
|
$
|
(42,613)
|
|
|
|
(a)
Relates to gross loss of previously reported Ocean Bottom
Integrated Technologies segment.
|
(b)
Includes loss from operations of previously reported Ocean Bottom
Integrated Technologies segment of $0.7 million and $2.9 million
for the three months ended June 30, 2019 and 2018, respectively,
which includes item (a) above and operating expenses of $0.7
million and $1.3 million for the three months ended June 30, 2019
and 2018, respectively.
|
(c)
Includes loss from operations of previously reported Ocean Bottom
Integrated Technologies segment of $1.6 million and $5.8 million
for the six months ended June 30, 2019 and 2018, respectively,
which includes item (a) above and operating expenses of $1.6
million and $2.4 million for the six months ended June 30, 2019 and
2018, respectively.
|
ION GEOPHYSICAL
CORPORATION AND SUBSIDIARIES
|
Summary of Net
Revenues by Geographic Area
|
(In
thousands)
|
(Unaudited)
|
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Latin
America
|
$
|
14,321
|
|
|
$
|
7,594
|
|
|
$
|
27,852
|
|
|
$
|
17,446
|
|
North
America
|
13,645
|
|
|
4,309
|
|
|
20,802
|
|
|
12,357
|
|
Europe
|
6,123
|
|
|
6,060
|
|
|
16,515
|
|
|
11,609
|
|
Asia
Pacific
|
3,676
|
|
|
3,929
|
|
|
5,543
|
|
|
7,863
|
|
Africa
|
2,278
|
|
|
2,222
|
|
|
4,667
|
|
|
7,241
|
|
Middle
East
|
1,106
|
|
|
441
|
|
|
2,465
|
|
|
1,190
|
|
Commonwealth of
Independent States
|
626
|
|
|
188
|
|
|
887
|
|
|
545
|
|
Total net
revenues
|
$
|
41,775
|
|
|
$
|
24,743
|
|
|
$
|
78,731
|
|
|
$
|
58,251
|
|
ION GEOPHYSICAL CORPORATION AND
SUBSIDIARIES
Reconciliation of Adjusted EBITDA to Net
Loss
(Non-GAAP Measure)
(In thousands)
(Unaudited)
The term EBITDA (excluding non-recurring items) represents net
loss before interest expense, interest income, income taxes,
depreciation and amortization and other non-recurring charges such
as severance expenses. The term Adjusted EBITDA is EBITDA
(excluding non-recurring items) but also excludes the impact of
fair value adjustments related to the Company's outstanding stock
appreciation awards. EBITDA (excluding non-recurring items)
and Adjusted EBITDA are not measures of financial performance under
generally accepted accounting principles and should not be
considered in isolation from or as a substitute for net income
(loss) or cash flow measures prepared in accordance with generally
accepted accounting principles or as a measure of profitability or
liquidity. Additionally, EBITDA (excluding non-recurring
items) and Adjusted EBITDA may not be comparable to other similarly
titled measures of other companies. The Company has included EBITDA
(excluding non-recurring items) and Adjusted EBITDA as a
supplemental disclosure because its management believes that EBITDA
(excluding non-recurring items) and Adjusted EBITDA provides
investors a helpful measure for comparing its operating performance
with the performance of other companies that have different
financing and capital structures or tax rates.
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Net loss
|
$
|
(8,287)
|
|
|
$
|
(25,500)
|
|
|
$
|
(29,535)
|
|
|
$
|
(43,839)
|
|
Interest expense,
net
|
3,111
|
|
|
2,911
|
|
|
6,223
|
|
|
6,747
|
|
Income tax
expense
|
2,719
|
|
|
154
|
|
|
4,126
|
|
|
1,226
|
|
Depreciation and
amortization expense
|
9,359
|
|
|
12,019
|
|
|
21,494
|
|
|
24,335
|
|
Severance
expense
|
2,810
|
|
|
—
|
|
|
2,810
|
|
|
—
|
|
EBITDA excluding
non-recurring items
|
9,712
|
|
|
(10,416)
|
|
|
5,118
|
|
|
(11,531)
|
|
Stock appreciation
rights expense (credit)
|
(2,450)
|
|
|
2,495
|
|
|
2,010
|
|
|
3,738
|
|
Adjusted
EBITDA
|
$
|
7,262
|
|
|
$
|
(7,921)
|
|
|
$
|
7,128
|
|
|
$
|
(7,793)
|
|
ION GEOPHYSICAL CORPORATION AND
SUBSIDIARIES
Description of Special Items and Reconciliation of GAAP (As
Reported) to Non-GAAP (As Adjusted) Measures
(In thousands, except per share data)
(Unaudited)
The financial results are reported in accordance with
GAAP. However, management believes that certain non-GAAP
performance measures may provide users of this financial
information, additional meaningful comparisons between current
results and results in prior operating periods. One such non-GAAP
financial measure is adjusted income (loss) from operations or
adjusted net income (loss), which excludes certain charges or
amounts. This adjusted income (loss) amount is not a measure
of financial performance under GAAP. Accordingly, it should not be
considered as a substitute for income (loss) from operations, net
income (loss) or other income data prepared in accordance with
GAAP. See the tables below for supplemental financial data
and the corresponding reconciliation to GAAP financials for the
three and six months ended June 30,
2019 and 2018:
|
Three Months Ended
June 30, 2019
|
|
Three Months Ended
June 30, 2018
|
|
As
Reported
|
|
Special
Items
|
|
As
Adjusted
|
|
As
Reported
|
|
Special
Items
|
|
As
Adjusted
|
Net
revenues
|
$
|
41,775
|
|
|
$
|
—
|
|
|
$
|
41,775
|
|
|
$
|
24,743
|
|
|
$
|
—
|
|
|
$
|
24,743
|
|
Cost of
sales
|
22,192
|
|
|
—
|
|
|
22,192
|
|
|
19,407
|
|
|
—
|
|
|
19,407
|
|
Gross
profit
|
19,583
|
|
|
—
|
|
|
19,583
|
|
|
5,336
|
|
|
—
|
|
|
5,336
|
|
Operating
expenses
|
22,136
|
|
|
(360)
|
|
(1)
|
21,776
|
|
|
21,002
|
|
|
(2,495)
|
|
(2)
|
18,507
|
|
Loss from
operations
|
(2,553)
|
|
|
360
|
|
|
(2,193)
|
|
|
(22,519)
|
|
|
2,495
|
|
|
(20,024)
|
|
Interest expense,
net
|
(3,111)
|
|
|
—
|
|
|
(3,111)
|
|
|
(2,911)
|
|
|
—
|
|
|
(2,911)
|
|
Other income
(expense), net
|
96
|
|
|
—
|
|
|
96
|
|
|
84
|
|
|
—
|
|
|
84
|
|
Loss before income
taxes
|
(5,568)
|
|
|
360
|
|
|
(5,208)
|
|
|
(25,346)
|
|
|
2,495
|
|
|
(22,851)
|
|
Income tax
expense
|
2,719
|
|
|
—
|
|
|
2,719
|
|
|
154
|
|
|
—
|
|
|
154
|
|
Net loss
|
(8,287)
|
|
|
360
|
|
|
(7,927)
|
|
|
(25,500)
|
|
|
2,495
|
|
|
(23,005)
|
|
Less: Net income
attributable to noncontrolling interest
|
(335)
|
|
|
—
|
|
|
(335)
|
|
|
(366)
|
|
|
—
|
|
|
(366)
|
|
Net loss attributable
to ION
|
$
|
(8,622)
|
|
|
$
|
360
|
|
|
$
|
(8,262)
|
|
|
$
|
(25,866)
|
|
|
$
|
2,495
|
|
|
$
|
(23,371)
|
|
Net loss per
share:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
(0.61)
|
|
|
|
|
$
|
(0.59)
|
|
|
$
|
(1.86)
|
|
|
|
|
$
|
(1.68)
|
|
Diluted
|
$
|
(0.61)
|
|
|
|
|
$
|
(0.59)
|
|
|
$
|
(1.86)
|
|
|
|
|
$
|
(1.68)
|
|
Weighted average
number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
14,098
|
|
|
|
|
14,098
|
|
|
13,928
|
|
|
|
|
13,928
|
|
Diluted
|
14,098
|
|
|
|
|
14,098
|
|
|
13,928
|
|
|
|
|
13,928
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30, 2019
|
|
Six Months Ended
June 30, 2018
|
|
As
Reported
|
|
Special
Items
|
|
As
Adjusted
|
|
As
Reported
|
|
Special
Items
|
|
As
Adjusted
|
Net
revenues
|
$
|
78,731
|
|
|
$
|
—
|
|
|
$
|
78,731
|
|
|
$
|
58,251
|
|
|
$
|
—
|
|
|
$
|
58,251
|
|
Cost of
sales
|
49,236
|
|
|
—
|
|
|
49,236
|
|
|
52,915
|
|
|
—
|
|
|
52,915
|
|
Gross
profit
|
29,495
|
|
|
—
|
|
|
29,495
|
|
|
5,336
|
|
|
—
|
|
|
5,336
|
|
Operating
expenses
|
47,985
|
|
|
(4,820)
|
|
(3)
|
43,165
|
|
|
40,495
|
|
|
(3,738)
|
|
(4)
|
36,757
|
|
Loss from
operations
|
(18,490)
|
|
|
4,820
|
|
|
(13,670)
|
|
|
(35,159)
|
|
|
3,738
|
|
|
(31,421)
|
|
Interest expense,
net
|
(6,223)
|
|
|
—
|
|
|
(6,223)
|
|
|
(6,747)
|
|
|
—
|
|
|
(6,747)
|
|
Other income
(expense), net
|
(696)
|
|
|
—
|
|
|
(696)
|
|
|
(707)
|
|
|
—
|
|
|
(707)
|
|
Loss before income
taxes
|
(25,409)
|
|
|
4,820
|
|
|
(20,589)
|
|
|
(42,613)
|
|
|
3,738
|
|
|
(38,875)
|
|
Income tax
expense
|
4,126
|
|
|
—
|
|
|
4,126
|
|
|
1,226
|
|
|
|
|
1,226
|
|
Net loss
|
(29,535)
|
|
|
4,820
|
|
|
(24,715)
|
|
|
(43,839)
|
|
|
3,738
|
|
|
(40,101)
|
|
Less: Net income
attributable to noncontrolling interest
|
(447)
|
|
|
—
|
|
|
(447)
|
|
|
(453)
|
|
|
—
|
|
|
(453)
|
|
Net loss attributable
to ION
|
$
|
(29,982)
|
|
|
$
|
4,820
|
|
|
$
|
(25,162)
|
|
|
$
|
(44,292)
|
|
|
$
|
3,738
|
|
|
$
|
(40,554)
|
|
Net loss per
share:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
(2.13)
|
|
|
|
|
$
|
(1.79)
|
|
|
$
|
(3.31)
|
|
|
|
|
$
|
(3.03)
|
|
Diluted
|
$
|
(2.13)
|
|
|
|
|
$
|
(1.79)
|
|
|
$
|
(3.31)
|
|
|
|
|
$
|
(3.03)
|
|
Weighted average
number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
14,065
|
|
|
|
|
14,065
|
|
|
13,374
|
|
|
|
|
13,374
|
|
Diluted
|
14,065
|
|
|
|
|
14,065
|
|
|
13,374
|
|
|
|
|
13,374
|
|
|
(1)
Represents severance expense of $2.8 million partly offset by stock
appreciation right awards credit of $2.4 million.
|
(2)
Represents stock appreciation right awards and related expenses in
the second quarter of 2018.
|
(3)
Represents severance expense of $2.8 million and stock appreciation
right awards expense of $2.0 million.
|
(4)
Represents stock appreciation right awards and related expenses in
the first half of 2018.
|
View original
content:http://www.prnewswire.com/news-releases/ion-reports-second-quarter-2019-results-300894296.html
SOURCE ION Geophysical Corporation