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Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp

Ion Geophysical Corp · Mar 14, 2007 · 42 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 1
    Growth Through Game-Changing Technology Bear Stearns Global Oil & Gas Conference 2007 New York City 14-15 March 2007
  2. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 2
    Forward-looking Statement 2 All presentations today may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward- looking statements include statements as to…
  3. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 3
    About The I/O Family of Companies A Leading Seismic Imaging Solutions Provider 3 Founded in 1968 (NYSE: IO) Global presence via 20 international offices Transformation started 2003 Focus on full-wave seismic Game-changing…
  4. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 4
    Stage 1: Our Corporate Legacy 40 Years as a Leading Geophysical Equipment Supplier 4 Land Acquisition Equipment Marine Acquisition Equipment Systems One, Two, and Four DigiRANGE acoustic positioning Scorpion cabled recording…
  5. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 5
    Seismic Imaging Market Ten (Billion) by 10 5 Annual Revenues by Sub-sector ( Millions) 12,000 CAGR = 8.8% Processing Land equipment 10,000 I/O participates Land acquisition a 3 - 4 billion market CAGR = 6.0% 8,000 Marine…
  6. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 6
    Seismic Market Expansions Increasing in Both Land & Marine 6 Marine Market Land Market New Seismic Vessels Land Crew Expansion *Channel counts also significantly increasing. 125 650 115 600 105 550 95 500 85 450 75 400…
  7. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 7
    Desperate Age of Exploration 7 1 BOE found for every 2 BOE consumed Smaller prospects, deeper in the geologic section Increasing focus on land (75% of global reserves) Projected Global Oil Supply & Demand 120,000 Thousands of…
  8. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 8
    Our View of Seismic Market Evolution At the Dawn of the Full-wave Era 8 Technology S-curves in Seismology Full-wave Era Characteristics of the Full-wave Era Measurement of both P- and S-waves Densely sampled data Game-changing…
  9. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 9
    Stage 2: Transforming via Acquisition Key Software & Services Additions in 2004 9 Orca (Spectra) command & control Advanced seismic data processing software for streamer operations for marine and land operations Gator command &…
  10. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 10
    Stage 3: Building a New Kind of Seismic Company Customized Solutions Based on Revolutionary Technologies & Services 10 ISS Integrated Seismic Services FireFly Seabed Geophysical Solutions Survey Data Geophysical Services…
  11. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 11
    I/O Strategic Imperatives 11 Lead Full-wave era Systems Full-wave / MEMS / Nano-technology / 3 dimensions Survey design, support, data collection/processing, processing technology, interpretation technology Greater Image Quality…
  12. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 12
    I/O Product Life Cycle Positioning 12 A Portfolio Approach 2007 2004 Land System Vibrators Marine Four Geophones Spectra Seismic Imaging Solutions Streamer Scorpion & Data Processing Products Vibrators Wave Equation…
  13. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 13
    I/O Growth Engines 13 Revenues in Millions 1200 Seismic Imaging Solutions Land 1000 Marine 800 600 400 200 0 2006 2011E Gross margin 29.3% 35 - 37% Op margin 6.8% 15 - 18% Revenues projected to double by 2011; Operating…
  14. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 14
    Seismic Imaging Solutions 14 Globalization of processing processing services in 8 worldwide locations Expansion of ISS (multi-client programs) Revenues in Millions 350 Data Library 300 ISS (Multi-Client) 250 Processing/Other 200 150…
  15. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 15
    Advanced Data Processing 15 Seismic processing is a 1+ billion market High-end imaging is fastest growing segment Significant (re)processing opportunities driven by more complex geologic regimes Competing at the high end…
  16. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 16
    Global Data Processing Footprint Advanced Imaging Service Centers in Key Markets 16 As of February 2007 Processing Service Locations
  17. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 17
    Data Processing Growth 17 Revenues in Millions 45 Focused on processing 42 images for SPAN programs 40 Marine emphasis, though moving towards land 35 33 Focus on the high-end of 32 the market (big, complex 30 jobs) 30…
  18. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 18
    Integrated Seismic Solutions Our Business Model for Full-scope Acquisition and Imaging 18 Vessel image courtesy of PGS Partial GXT Client List Executing the Program with Designing the Imaging Program with Experienced Contractors…
  19. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 19
    Overview of a BasinSPAN Program 19 The Original GXT SPAN GulfSPAN (U.S. Gulf of Mexico) Comprehensive view of the petroleum system Integrates geology and geophysics Ultra-deep view Source rock deposition Migration pathways…
  20. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 20
    Integrated Seismic Solutions (ISS) SPAN Programs from 2000-07 20 ArcticSPAN 2007 NovaSPAN GulfSPAN CaribeSPAN ColombiaSPAN IndiaSPAN AfricaSPAN 2004 GulfSPAN SPAN Programs: Ultra-deep geophysical data libraries…
  21. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 21
    ISS (Multi-client) and Data Library Growth 21 Revenues in Millions 120 Fully underwritten surveys 104 100 Contract vessels 89 Data library sales 80 Processing in-house Retain data ownership 60 40 40 20 17 0 2002 2003…
  22. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 22
    Marine Growth 22 Towed Streamer Seabed Digi product line VSO Expanding market Next-generation streamer Concept ORCA Revenues in Millions 350 Seabed 300 Data Mgmt Software 250 Towed Streamer 200 150 100 50 0 2006 2011E Gross…
  23. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 23
    Towed Streamer Operations Key Hardware & Software Components 23 Navigation & Positioning Software Recording Hardware Energy Sources Towed Streamer Cables Streamer Positioning & Control Devices
  24. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 24
    Marine Streamer Systems A Tale of Three Segments 24 Streamer positioning & control Acknowledged market leader Favorable market trends New-build vessels Increased streamer counts Tighter streamer spacing Streamers & recording…
  25. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 25
    Marine Seabed Systems VectorSeis Ocean (VSO) 25 Advanced technology for full-wave, seabed acquisition Approximately 10% of marine market OBC (ocean bottom cable) Benefits of OBC and VSO : Ideal for obstructed and shallow waters…
  26. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 26
    Land Growth 26 More competitive cable-based system - Scorpion New cableless system - FireFly Revenues in Millions 500 FireFly Base business 400 300 200 100 0 2006 2011E Gross margin 19.2% 38 - 40% Op margin 12.7% 34 - 36%
  27. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 27
    Land Surface Systems Value of Land Imaging Systems Sold in Period 27 ( Millions) 400 Others 350 WesternGeco Aram Aires 300 Sercel 250 I/O 200 150 100 50 25.5% 17% 21.6% 0 2004 2005 2006E *Includes only land systems…
  28. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 28
    Land Imaging Systems A Tale of Three Segments 28 Sensors Sensor geophones Field proven single component sensor Market leader with over 9 million geophones in service worldwide VectorSeis sensors Digital 3C MEMS sensor for…
  29. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 29
    Building a New Kind of Seismic Company A Case Study of FireFly 29 ISS Integrated Seismic Services FireFly Seabed Geophysical Solutions Survey Data Geophysical Services design processing Land Marine Software Seismic…
  30. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 30
    The FireFly Ecosystem in Action An Integrated Solution for Imaging an Unconventional Gas Reservoir 30 The Customer Challenge: Identify fracture sweet spots in one of the largest gas producing assets in North America in order to…
  31. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 31
    The FireFly Ecosystem in Action An Integrated Solution for Imaging an Unconventional Gas Reservoir 31 The I/O Solution: Develop and deploy a 10,000 station cableless land acquisition system supported by innovative, efficient methods…
  32. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 32
    A Vision for Growth over the Next Five Years Potential Revenues and the Drivers of Success 32 Consolidated Revenues ( Millions) Demonstrating the advantages 1200 of densely sampled, full-wave CAGR = 16% imaging 1100 Developing…
  33. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 33
    Financials
  34. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 34
    Net Revenues 34 ( Millions) 600 504 500 % 400 43.5 G R: 363 CA 300 241 200 150 119 100 0 2002 2003 2004 2005 2006
  35. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 35
    Revenues/Gross Margin 35 Revenues Millions Gross Margin % 600 35 504 500 30.6 30 400 363 27.0 25 300 200 20 2005 2006 2005 2006
  36. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 36
    Segment Revenues 36 ( Millions) Land Imaging Systems Marine Imaging Systems 250 150 128 31% 205.8 200 125 157 86% 100 150 75 69 100 50 50 25 0 0 2005 2006 2005 2006 Seismic Imaging Solutions GXT Data Management…
  37. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 37
    EBITDA 37 ( Millions) 100 83 80 60 43 40 21 20 -49 -9 - (20) (40) (60) 2002 2003 2004* 2005 2006 EBITDA (earnings before net interest expense, taxes, depreciation, and amortization) * Restated
  38. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 38
    Diluted EPS 38 0.40 0.35 0.33 0.30 0.25 0.22 0.20 2005 2006
  39. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 39
    Balance Sheet Highlights 39 12/31/05 12/31/06 Total LT Debt 71.5 MM 71.0 MM LT Debt/Cap 12.1% 11.9% Net Debt/Cap 10.2% 10.2% Cash & Eq 15.9 MM 17.1 MM
  40. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 40
    I/O Updated Annual Guidance 40 2007 Revenues 610 670 MM Gross Margin 29 31% Operating Exp 20 22% as % of Rev Diluted EPS 0.45 0.60
  41. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 41
    Investment Highlights 41 I/O + GXT + Concept Systems = technology-focused seismic solutions company Customized technologies that when integrated across the seismic value chain create significant competitive advantages…
  42. Bear Stearns Global Oil and Gas Conference – Ion Geophysical Corp – slide 42
    The End Thank You for Your Time 42

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