CGG 2014 April Presentation All results are presented before Non-Recurring Items linked to Fugro (NRFI) and before impaiment & write-off, unless stated otherwise
Agenda 1. CGG in the E&P value chain 2. Equipment Division Strategic Roadmap 3. Acquisition Division Strategic Roadmap 4. GGR Division Strategic Roadmap 5. Conclusion 3
CGG in the E&P value chain CGG Solutions for Exploration & Appraisal A unique multi-disciplinary non- The full spectrum of NPA Satellite Mapping imagery, exclusive library of geological & geophysical acquisition services…
CGG in the E&P value chain CGG Solutions for Development Wellsite geological services: Broadband Seismic and Integrated G&G workflows for RoqSCAN mineralogy, advanced Subsurface Imaging static and dynamic reservoir biosteering, &…
CGG in the E&P value chain CGG Solutions for Production Permanent reservoir monitoring Microseismic monitoring Quantitative reserves valuation solutions solutions through Magnitude and recovery factor analysis JV 4D reservoir…
Equipment: Resilient despite lower revenues Land equipment Revenue/EBIT (In million ) Total sales were 1,045m, down 13%: Marine equipment EBIT Margin External sales at 834m, down 13% 1,204 1,142 57% land equipment and 43% marine…
Sercel, the clear market leader with an unrivalled installed base 2013 Total Market Land Market Marine Market Total 1.0bn Total 0.9bn 1.9bn Others Others Vibrators 2 (40%) 2 (25%) Navigation Geophones 1 (55%) Source 1 (50%)…
Marine: Driven by technology and replacement Sentinel, the leading streamer technology km Sentinel sold New builds Sentinel, the only true solid cable with a unique 1000 15 acoustic performance, launched in 2006 800 Sentinel RD…
Land: Driven by technology and growth Land recording channels More channels for higher resolution System capabilities vs. usage Continuous channel count growth, multiplied by 5 every 10 years Channels possible 1,000,000 408 UL /…
Equipment profitability: Operating margin driven by volumes and product mix Sercel is an equipment manufacturer Revenue vs. % Operating Income by quarter Business model highly sensitive to volume sold and product mix 400 Higher…
Equipment Strategic Roadmap Generate sustained replacement revenue through a large installed base Boost incremental demand with new technologies (508XT, Sentinel MS) Secure award of large mega-crews Maintain technological edge…
Acquisition Division Strategic Roadmap 15
Acquisition Division: Challenging market conditions Land & Airborne Acquisition revenue at 2,226m, up 19% Marine Acquisition Revenue (In million ) EBIT Margin External revenue at 1,636m, up 9% 2,226 1,878 440 Land & Airborne…
Land Acquisition: Strategic review ongoing The Land situation: An enabler for Sercel and Processing activities BUT Low margins / High risks / Capital-intensive business Activity showing a loss in 2012 & 2013 Strategic review…
Land Acquisition : New footprint KUWAIT Strengthened presence in Middle East 2 mega-crews 150 000 to 200 000 channels / crew Historical long-term partnership with TAQA in the Middle East CGG holding 49% of the new ARGAS UAE 1…
Marine Acquisition Supply: Evolution of of vessels (8+ streamers) btw 2008 & 2016 Number of vessels (8+ streamer) at year end +3% vessels 80 +6% vessels Industry Retirement 66 68 Scenario 70 61 62 62 CGG 60 58 65 17 67 13 52 18…
Strategic Roadmap: Targeted fleet of 13 vessels Current Fleet size: 17 vessels on the open market HIGH-END CAPACITY MID-END CAPACITY 12-20 streamers 8-12 streamers Oceanic Sirius Oceanic Vega Geo Coral Geo Caspian Geowave Voyager…
Acquisition Strategic Roadmap Provide new integrated high-end acquisition solutions (BroadSeis/BroadSource, StagSeis) to meet complex geological challenges Reformat the fleet down to the critical size of 13 vessels to: Address global…
GGR Division Strategic Roadmap 22
GGR: Solid and sustained profitability MC Revenue GGR revenue at 1,296m up 36% Other GGR GGR Revenue (In million ) EBIT margin Multi-Client at 585m, up 24% with capex up 29% 1,296 y-o-y: 950 939 711 Strong H1 multi-client…
Subsurface Imaging Market Leadership: 2013 Welling Report Subsurface Imaging Makes BEST Delivering the best IMPROVEMENTS UNDERSTANDING seismic image, of how acquisition BEST FROM LESSONS issues affect data with advanced BEST IMAGE…
GOM StagSeis surveys IBALT, DEUX, TROIS TROIS 3 years program started in July 2012 and finishing end 2014 20 320km2 data acquired with latest technology StagSeis 25
IBALT Program designed for the coming licensing rounds in GoM 26
Geoconsulting and Geosoftware Geoconsulting: offering integrated projects Acknowledged leader in geopolitical multi-client products and reports, and high-end consulting services across the E&P value chain Integrated geophysics,…
GGR Strategic Roadmap Build and diversify large regional geoscience multi-client library Maintain leadership edge through sustained innovative technologies and algorithms Develop an integrated workflow Hire, train and retain top…
Conclusion
Acquisition Division: Change of perimeter in 2014 Land Acquisition Restructuring activity in North America New set up in the Middle East with Argas: ArdiSeis integrated in the new Argas and considered as Equity from Investees…
2014 Management priorities Focus on commercial performance in market conditions expected to remain stable with a low Q1 CGG backlog as of January 1st: 1.35bn Marine fleet coverage: 100% booked in Q1, 75% in Q2, 35% in Q3 Focus on…
2014-2016 Strategy: Rebalancing portfolio 2013 Main Drivers 2016 3.8bn Revenue At unchanged market conditions 4.0bn Revenue 11% Ebit margin Revenue before intra-group eliminations 15% Ebit margin Equipment Revenue: 1.2-1.3bn 1.5…
Thank you
2013 Balance Sheet and Acquisition impairment & write-off Acquisition Impairment & write-off: 800m Land: 79m as a result of overall more difficult market conditions Marine 721m o 139m vessels fair value rebasement to reflect future…
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