January 2014 2014-2016 Profitability & Cash: a New Strategic Phase
A Zoom back on 2013
2013 Group EBIT End 2012 post Fugro: 700m - 60m: Lower marine price increase 300m - 60m: Equipment, no mega crews Difference: July 2013 Q2 results: 580m-600m 200m - 60m: Acquisition= lower marine price increase Acquisition -…
CGG 2013 profitability profile: Two solid and resilient divisions, one volatile and fragile Equipment: Strong profitability resilience despite lower revenues - No mega crews awarded in 2013 in land equipment - Solid operating…
CGG 2016: A New Profile
A clear strategy to boost CGG profitability 2010-2012: Significant improvement in Marine performance Performance plan Fleet modernization, cost reduction Technology and commercial differentiation Successful integration of Fugro…
Equipment Roadmap Generate sustained replacement revenue through a large installed base Boost incremental demand with new technologies (508XT, Sentinel MS) Maintain technological edge ahead of competitors Secure award of large…
Equipment : Marine revenue driven by technology and replacement market Sentinel, the leading streamer km Sentinel New technology sold build 1000 15 - Sentinel, the only true solid cable with a unique acoustic performance,…
Equipment: Land revenue driven by technology and volumes More channels for higher resolution - Continuous channel count growth, multiplied by 5 every 10 years KUWAIT 1-2 mega-crews 100,000 channels/crew 508XT powerful response…
Acquisition Roadmap Provide integrated high-end acquisition solutions to meet complex geological challenges Refocus land acquisition on niche & techno markets and partnerships Rebalance Airborne towards oil and gas markets Reformat…
Marine Acquisition: repositioned on high-end segments Positive long-term fundamentals remain, with solid summer demand and increasing demand for technology - Sustained activity in traditional basins and new emerging basins (frontier…
Marine Acquisition: CGG fleet at the end Q3-2013 18 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 Viking Vanquish…
Land Acquisition: Strategic review ongoing The Land situation: - Ranked 1 in performance from the client perspective - An enabler for Sercel and Processing activities BUT - Low margins / High risks / Capital-intensive business/…
GGR Roadmap: From Seismic to Geology and Reservoir Build and diversify large regional geoscience multi-client library Maintain leadership edge through sustained innovative technologies and algorithms Develop an integrated workflow…
GGR: Multi-Client boosted by after-sales ramp-up Business model - Marine: focus on key Multi-Client basins: Gulf of Mexico, Brazil, North Sea, West Africa CANADA/ALASKA N. SEA 21,000 km2 In 2015-2017, benefit from our 2012-2014…
GGR: SI / Geoconsulting / Geosoftware / DMS Solid and sustainable growth driven by people Business model - Subsurface Imaging: Retention of skilled people and tight monitoring of computing power to address exponential volumes of data…
Conclusion
Financing Strategy Status by September-end 2013 Debt Structure - Net Debt at 2.3bn = 51% Equity = 3.1 LTM Free EBITDA - 4.5 year average maturity - 4.85% average cash interest on mid-term debt Strategic guidelines 17 -…
Looking forward Rightsizing and reformatting Acquisition Plan to be presented on February 27th Mid-Term 2016 target - 2016 revenue above 4bn - 400 basis point EBIT margin improvement - Group cash generation boosted beyond EBIT…
Thank you
Equipment division: Profitable growth driven by technology and volume Key Figures Market Positioning (3Q 2013) Strong footprint in land, 70% market share in cable Total sales Number of employees systems 728m 2,500 Strong footprint in…
Acquisition division: Repositioned on High-End segments Key Figures Market Positioning (3Q 2013) The largest Marine seismic fleet dedicated Total sales Number of employees to high-end market 1,767m 3,000 The high-end Land acquisition…
GGR Division: Solid and sustainable growth Key Figures* Market Positioning (3Q 2013) Strong geosciences brands Total sales Number of employees 442m 3,350 Technology and broad spectrum of technical (not including Multi-Client…
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