PGS Saw Increase in Marine Order Book for Second Quarter 2009
PGS announced resilient Q2 earnings, with adjusted EBITDA of $161.2 million and cash and cash equivalents of $168.1 million at the end of Q2, up 65% compared to end Q1. More importantly, the Company saw an increase in its Marine order book in June for the first month since August 2008, which is now at $559 million. Ramform- and GeoStreamer® vessels still earn margins at acceptable levels and visibility for Q4 is now good with close to 85% of fleet capacity committed for the remainder of 2009. The Company maintains its 2009 guidance.
Q2 2009 Group performance
Earnings before interest and tax depreciation and amortization ("EBITDA") of $161.2 million, down 27% compared to Q2 2008, driven primarily by reduced Marine contract revenues and lower Onshore MultiClient activity.
Revenues of $294.3 million and EBIT of $92.3 million, excluding the previously announced impairment charge relating to the sale of Geo Atlantic. Pre-funding revenues were $82.7 million in Q2, which is 146% of MultiClient cash investments.
EBIT improved to $0.8 million in Q2 2009, from a loss of $10.5 million in Q1 2009, despite low MultiClient sales and lower activity levels in North America, North Africa and Peru. Onshore was positively impacted by good operations in Mexico.
Endorsement of GeoStreamer® technology
Momentum is building fast with substantial customer commitments for end 2009 as proof that the uniqueness of the technology is appreciated.
Sale of Geo Atlantic
Agreement to sell the vessel Geo Atlantic to GC Rieber for $58.0 million in cash. The positive effect on net debt will be reflected in Q3. In line with earlier announcements, the Company recorded a $48.1 million impairment charge in Q2 2009 relating to the sale.
$119 million private placement of shares
The Company strengthened its financial positions through a private placement in Q2.
Strong cash flow from operating activities
Cash flow from operating activities was $208.1 million, up 28% from Q2 2008. At end Q2 net interest bearing debt amounted to $962.1 million, down $179.4 million from previous quarter. Liquidity reserve at end Q2 amounted to $364 million.
Ramform Sterling delivered on time
The vessel was delivered June 30, and already has a full order book for 2009.
The Company maintains its guidance for full year 2009, including an expected full year Adjusted EBITDA of between $700-800 million, with capital expenditure guidance slightly reduced.
Jon Erik Reinhardsen, Chief Executive Officer and President of PGS, commented, "June was the first month in three consecutive quarters to see an improved order book. This is due to increased interest and endorsement of the GeoStreamer® technology and the competitiveness of our high-end vessels. Still, we need to see further reduction in global streamer capacity to balance the market demand. Our modern, state-of-the-art and cost efficient fleet puts us in a favorable position compared to competition in the effort to preserve margins and generate cash in a challenging environment."
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