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Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp

Ion Geophysical Corp · Jan 23, 2008 · 36 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. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 1
    From Vision to Reality Building a 21st Century Reservoir Imaging Company Johnson Rice Third Annual Emerging Growth Energy Conference Houston, Texas Presented by Brian Hanson EVP / CFO January 23, 2008
  2. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 2
    Forward-looking Statement 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. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 3
    Formulating our Vision for Growth Key Beliefs Underpinning our Strategy (Circa 2003) The E&P industry is entering a long up-cycle Supply-demand imbalance will result in higher oil and gas prices A changing playing field of…
  4. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 4
    Business Increasingly International 4 Location of Discoveries 100 MMBOE Source: CERA [4]
  5. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 5
    Majority of Global Resource Base is Onshore Hydrocarbon Distribution in the Top 25 Basins 5 Known Reserves + Mean Undiscovered Resources Billions of Barrels of Oil Equivalent (Gas + Oil + LNG) 40 538 126 85 34* 94 72 33…
  6. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 6
    Seismic Imaging Market 6 Ten (Billion) by 10 Annual Revenues by Sub-sector ( Millions) 12,000 CAGR = 8.8% Processing 10,000 Land equipment Land acquisition 8,000 Marine equipment CAGR = 6.0% Seabed acquisition 6,000…
  7. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 7
    Our Strategy Approach the business as a portfolio of three segments Mature businesses: benefit from the rising tide Fixer-uppers: gain market share with new products/positioning Game-changers: transform their segments (the largest…
  8. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 8
    Enabling Our Strategy Key Actions Since 2004 Acquired GX Technology (GXT) and Concept Systems (2004) Invested as a corporate VC in Transform Software (2005) Develop a next-generation workstation for interpreting full-wave data…
  9. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 9
    Financial Results and Business Mix 9 Since the Inception of Our New Strategy in 2003 Consolidated Revenues Mix of Business by Segment ( Millions) (Percentage of 2006 Revenues) 700 100% = 504 million 600 CAGR = 43% 500 147M…
  10. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 10
    A View on OFSE Cycles Technology-intensive Providers Benefit in Long Up-Cycles [ 10 ]
  11. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 11
    R&D and Revenue Changes (2003-06) Building Long-Term Earnings Power US (Millions) R&D Revenues 40 38 Million 600 506 Million 35 500 14% 30 400 17% 25 68% +147% 20 Million 20 300 51% 15 200 68% 150 Million 10 10% -16%…
  12. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 12
    ION Product Life Cycle Positioning A Portfolio Approach 2007 2004 Land System Vibrators Marine Four Geophones Spectra Seismic Imaging Solutions Streamer Scorpion & Data Processing Products Vibrators Wave Equation Geophones…
  13. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 13
    ION Total Revenues Revenues in Millions 1800 1600 1400 1200 Seismic Imaging Solutions 1000 Land 800 Marine 600 400 200 0 2006 2012E Gross margin 30.6% 35 37% Op margin 7.9% 15 18% [ 13 ]
  14. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 14
    The Third Era of Seismic Imaging Digital, Full-wave Full-wave Technology S-curves in Seismology Era 2007 3D Era 2000s 1970s 2D Era Characteristics of the Full-wave Era Anticipated Results Measurement of both P- and…
  15. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 15
    At the Core of Full-wave Imaging VectorSeis Digital Sensors From silicon wafer to field-ready sensor (for both land & seabed applications) Gold plated silicon wafer ASIC 3 sensor packages VectorSeis (Si-flex MEMS accelerometer)…
  16. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 16
    High Density, Full-wave Drives Data Explosion Requires New Processing and Data Management Techniques 2D Era 3D Era Full-wave Era 1,000,000 1,000 Average Survey Size (GB) 1 .1 1960 1980 2000 2020 [ 16 ]
  17. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 17
    Full-Wave Moving Into Early Mainstream Market Full-wave Imaging Delineates Gas-Bearing Channel Sand P-wave image Full-wave image Channel Sands Difficult to Identify Channel Sands Clearly Visible [ 17 ]
  18. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 18
    Full-Wave Moving Into Early Mainstream Market Full-wave Imaging Delineates Sand Shear from Shale Impedance Shear Impedance Shale Sand Full Wave Compared to P-Wave for Lithological Delineation She a r data m R ec orded Si…
  19. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 19
    Pushing the Envelope in Land Processing (Fractured) Reservoir Characterization & Well Optimization Shale & Coal Sand Undrilled, highly prospective reservoir [ 19 ]
  20. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 20
    Full-Wave Moving Into Early Mainstream Market Full-wave Imaging Identifies Fracture Zones Note presence of Same lithology fractures in No fractures producing zone No production New well location [ 20 ]
  21. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 21
    Full-wave Gets Results in China Imaging Project Identifies Most Productive Well in Province Excerpts from Press Release Local Chinese Newspaper GAS DRAGON RISING FROM THE DEPTHS OF THE WESTERN SICHUAN BASIN Best well in the…
  22. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 22
    FireFly- A Game Changer for Land Imaging The Winning Model: More for Less Deliver a better image in a shorter period of time and at lower cost Better image-high density/full-wave Reduced cycle time Higher productivity-lower…
  23. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 23
    The FireFly Difference Station Equipment Layout & Pre- Surveying Density Deployment Shooting Processing Conventional Cable Stakes & Cable-Constrained 25 Tons Visual & Manual Flags (200 x 1800) Resource Heavy LIDAR &…
  24. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 24
    The FireFly Difference Our Experience on Image Quality & Operating Metrics Conventional 20 - 40 Fold Image Quality 400 1000 Fold Conventional 75 Man Crew Crew Size 45 Man Crew Pre- Layout Shooting Pickup Processing…
  25. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 25
    The Latest on FireFly Survey Completed for Apache (East Texas) Dense Foliage Farms and Agriculture Marshy Wetland (Flooding) [ 25 ]
  26. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 26
    FireFly Status Assimilating experiences from BP and Apache surveys Release 1.3 this fall for continued Field Trials Release 2.0 during first of 2008. Improvements in power management Improvements for recording reliability General…
  27. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 27
    Summary We believe we are in a long cycle where technology will become the main driver of profitability Since 2003, I/O has repositioned its strategy and portfolio to capitalize on these trends We have benefited from the rising…
  28. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 28
    Financials [ 28 ]
  29. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 29
    Net Revenues Q3 YTD vs. 2002-06 ( Millions) 600 504 504 500 400 363 300 241 200 150 119 100 0 2002 2003 2004 2005 2006 Q3 YTD 2007 [ 29 ]
  30. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 30
    Revenues and Gross Margin Percent Q3 YTD vs. 2005-06 Revenues ( Millions) Gross Margin % 504 35 504 500 30.6 400 363 30 27.0 27.0 300 25 200 100 20 2005 2006 Q3 YTD 2005 2006 Q3 YTD 2007 2007 [ 30 ]
  31. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 31
    Segment Revenues Q3 YTD vs. 2005-06 ( Millions) Land Imaging Systems Marine Imaging Systems 300 243 150 128 117 250 206 125 200 157 100 150 75 69 100 50 50 25 0 0 2005 2006 Q3 YTD 2005 2006 Q3 YTD 2007 2007 Seismic Imaging…
  32. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 32
    EBITDA Q3 YTD vs. 2002-06 ( Millions) 100 83 80 76 60 43 40 21 20 -49 -9 - (20) (40) (60) 2002 2003 2004* 2005 2006 Q3 YTD 2007 EBITDA (earnings before net interest expense, taxes, depreciation, and amortization) *…
  33. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 33
    Diluted EPS Q3 YTD vs. 2005-06 0.40 0.33 0.30 0.26 0.22 0.20 0.10 2005 2006 Q3 YTD 2007 [ 33 ]
  34. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 34
    Balance Sheet Highlights 12/31/05 12/31/06 9/30/07 Total LT Debt 71.5 MM 71.0 MM 71.5 MM LT Debt/Cap 12.1% 11.9% 12% Net Debt/Cap 10.2% 10.2% 9% Cash & Equity 15.9 MM 17.1 MM 26.0 MM [ 34 ]
  35. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 35
    Updated Annual Guidance Full-Year 2007 2007 Revenues 660 710 MM Diluted EPS 0.45 0.60 [ 35 ]
  36. Johnson Rice Third Annual Emerging Growth Energy Conference – Ion Geophysical Corp – slide 36
    Questions [ 36 ]

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