ION Geophysical Corporation 94192 ION Geophysical Corporation Sidoti & Company, LLC Eighteenth Annual Emerging Growth Research Institutional Investor Forum Greg Heinlein, SVP and Chief Financial Officer March 18, 2014
Todays Discussion Overview of ION Financial Results 3
FY 2013 Highlights Financial FY 2013 revenues increased by 4% Y/Y Challenging first nine months 2013 with cautious spending by E&P clients Finished 2013 with a record quarter for revenues and operating income, led by 76M in data…
ION Geophysical Technology Company Driven to Solve the Toughest E&P Challenges Technology Company 45 Years of technology firsts: Full-wave Founded in 1968 as Input / Output, imaging, under-ice acquisition, cableless headquartered…
ION Strategy Aligning Our Focus With Major Industry Growth Areas Adding the Greatest Value in Every Stage of the Geophysical Cycle: Planning Technology & Equipment Acquisition Processing & Interpretation Reservoir Monitoring…
Continued E&P & Seismic Industry Growth Actual Projected Global E&P Trends 900 18 800 16 700 14 E&P Spending Seismic Spend (B) Expected to reach record levels E&P Spend (B) 600 12 in 2014 500 10 More production growth…
Business Segments Overview FY 2013 Revenues Adjusted OI Adjusted OM Solutions Services High Growth 87% of FY 13 revenues from E&P 17% Multi-client (New Venture Programs and Data Library Sales) 71% GeoVentures project execution…
Solutions Segment Diversifying the Portfolio Across the E&P Lifecycle ION Solutions Segment ION Solutions Revenue Revenue Mix Mix Data Processing Relevant across all phases of the E&P Expect multiple increase in lifecycle…
2013 Multi-client Revenues Aligned with International Exploration Activity Canada +3% Europe +8% Russia 44 42 43 +11% 2012 2013 2014E 47 50 45 2012 2013 2014E 54 60 47 2012 2013 2014E Middle East +14% United States…
Software Segment Steady Growth Increasing E&P Focus ION Software Segment Revenue Mix E&P Software Solutions Narwhal for Ice Management Expect significant increase Software solutions for in Software segment Seismic Simultaneous…
Systems Segment Restructured for Profitability Focus on Ocean-bottom Seismic Restructured for long-term profitability 140 Systems Revenue M 120 Introduced refurbishment programs and 100 132 reduced cost structure within legacy…
OceanGeo Geophysical company specializing in multicomponent seismic ocean- bottom acquisition Increased ownership to 70%, with Georadar 30% Provides high-value route-to-market for Calypso Awarded a 4-5 month, 510 sq km 3D…
Todays Discussion Overview of ION Financial Results 15
Financial Overview FY 2013 Revenue M Adjusted Op. Margin % Total revenues up 4% Y/Y: 600 Solutions up 10% 500 20% 17% 400 Software down 9% 15% 300 11% Systems down 7% 200 10% 100 5% - Overall adjusted results driven by:…
Financial Overview of Special Items FY 2013 ( in Thousands) FY-13 Special FY-13 As Reported Items As Adjusted 1. 26M Systems inventory write-downs Net revenues 549,167 - 549,167 and severance charges, and 5M partial Cost of…
ION Historical Financial Results 2009 2013 ( in Thousands) Revenue Adj. EBITDA and Adj. EBITDA Margins Legacy Land Operations Legacy Land Operations 190,057 526,317 549,167 163,810 155,894 157,882 444,322 454,621 419,781 77,774…
Financial Overview Cash Flow ( in Thousands) SUMMARIZED CASH FLOW 2012 2013 Cash from operations 195,712 128,271 Working capital (26,412) 19,085 Multi-client investment (145,627) (114,582) PP&E Capital Expenditures (16,650)…
Financial Overview Balance Sheet as of Dec 31, 2013 Capital Employed M Capital Book Value M 600 700 600 500 500 400 239M 400 243M 300 300 200 200 100 186M 220M 100 148M 89M 97M 72M 0 0 Q3 13 Q4 13 Q3 13 Q4 13 Cash…
Appendix 21
WesternGeco Litigation Reserve Update In October, the Judge entered Order: Awarded supplemental damages calculated by combining the Litigation Reserve M jurys previous reasonable royalty with lost profits damages 194 awards per unit…
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