Segment Revenues and Other Income of $595.9 million, compared to $880.1 million in 2019
Segment EBITDA of $397.7 million, compared to $556.1 million in 2019
Segment EBIT (excluding impairments and other charges) of $12.2 million, compared to $96.4 million in 2019
Segment MultiClient pre-funding revenues of $218.6 million, with a corresponding pre-funding level of 98%, compared to $256.5 million and 105%, respectively, in 2019
Cash flow from operations of $366.5 million, compared to $474.3 million in 2019
As Reported revenues and Other Income according to IFRS of $512.0 million and an EBIT loss of $188.0 million, compared to $930.8 million and EBIT of $54.6 million, respectively, in 2019
Impairment charge of $108.4 million in 2020 relating to stacked vessels and a higher estimated weighted average cost of capital used for impairment testing
Recorded (as Other Income) government grants relating to the Covid-19 pandemic of $38.8 million in 2020, hereof $15.5 million estimated for Q4
Strong project execution despite logistical challenges and travel restrictions caused by Covid-19 pandemic
Reduced annual run rate gross cash cost by more than $200 million compared to initial 2020 plan to compensate for a revenue reduction of 37% caused by the Covid-19 pandemic
Extension of all debt maturities and amortization to September 2022 and beyond (see description in Note 11 in the Condensed Interim Consolidated Financial Statements)
“2020 developed very differently than any of us expected. In Q1 the seismic market quickly changed from an improving path to an abrupt downturn. Preventive measures to reduce spreading of the coronavirus caused a dislocation in the oil market and a significant reduction in our clients’ investment plans. We reacted swiftly by reducing cost and preserving liquidity. Gross cash cost was slashed by more than $200 million from stacking vessels, significant downscaling of the organization, renegotiating terms with suppliers and several other initiatives. Further, we have worked through the year to preserve liquidity by implementing extension of maturities and debt amortization to September 2022 and beyond. These measures allow us to cope with this downturn and more quickly return to generating positive cash flow and repaying debt.
MultiClient late sales in the fourth quarter benefited from a usual end-of-year increase and license round activity in West Africa and Brazil. New acquisitions of MultiClient data were mainly done offshore Egypt and we returned to Brazil with one vessel to continue our Campos deep water campaign, initially started in early 2020. During Q4 we sold well from MultiClient surveys acquired in earlier quarters but still in the processing phase, boosting our pre-funding level to 185% on MultiClient cash investment of $33 million. Only 8% of our vessel capacity was allocated to contract work in the quarter, a 4D project offshore Angola.
We launched a UK Scheme of Arrangement in Q4 to implement the re-scheduling of debt maturities and amortizations that we had agreed with an overwhelming majority of lenders. An English court sanctioned the scheme on February 2 this year allowing for the debt re-scheduling to be implemented. The transaction is expected to close during February.
The order book increased during the quarter. It now stands at $202 million and with additional bookings at the start of this year we have good visibility through the second quarter and into the third quarter. We expect 2021 to be slightly better than last year. The current booking and bidding activity together with our MultiClient project pipeline, supports our cautiously positive view and expectation of increased acquisition activity from early Q2.”
Rune Olav Pedersen,
President and Chief Executive Officer
PGS expects the improved oil price, a likely global recovery from the Covid-19 pandemic, and the effects of deferred projects from last year to support a gradual increase of demand for seismic services in 2021. Despite the impacts of the Covid-19 crisis, energy consumption is expected to continue to increase longer term with oil and gas being an important part of the energy mix as the global energy transition evolves. Offshore reserves will be vital for future supply and support demand for marine seismic services. The recovery of the seismic industry is likely also to benefit from the recent industry capacity reductions.
Based on five vessels in operation through 2020, and with reference to the disclosed risk factors, PGS expects full year 2021 gross cash costs to be below $400 million.
2021 MultiClient cash investments are expected to be approximately $150 million.
Approximately 45% of 2021 active 3D vessel time is expected to be allocated to MultiClient acquisition.
Capital expenditures for 2021 is expected to be approximately $40 million.
The order book totaled $202 million on December 31, 2020 (including $89 million relating to MultiClient). The order book was $160 million on September 30, 2020 and $322 million on December 31, 2019.
Profit and loss numbers Segment Reporting
Segment Revenues and Other Income
Segment EBITDA ex. other charges, net
Segment EBIT ex. impairment and other charges, net
Profit and loss numbers As Reported
Revenues and Other Income
Net financial items, other
Income (loss) before income tax expense
Income tax expense
Net income (loss) to equity holders
Basic earnings per share ($ per share)
Other key numbers As Reported by IFRS:
Net cash provided by operating activities
Cash Investment in MultiClient library
Capital expenditures (whether paid or not)
Cash and cash equivalents
Net interest bearing debt
Net interest bearing debt, including lease liabilities following IFRS 16
The Q4 2020 webcast can be accessed from this link:
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PGS (or “the Company”) is a focused Marine geophysical company that provides a broad range of seismic and reservoir services, including acquisition, imaging, interpretation, and field evaluation. The Company’s MultiClient data library is among the largest in the seismic industry, with modern 3D coverage in all significant offshore hydrocarbon provinces of the world. The Company operates on a worldwide basis with headquarters in Oslo, Norway and the PGS share is listed on the Oslo stock exchange (OSE: PGS). For more information on PGS visit www.pgs.com.
The information included herein contains certain forward-looking statements that address activities, events or developments that the Company expects, projects, believes or anticipates will or may occur in the future. These statements are based on various assumptions made by the Company, which are beyond its control and are subject to certain additional risks and uncertainties. The Company is subject to a large number of risk factors including but not limited to the demand for seismic services, the demand for data from our multi-client data library, the attractiveness of our technology, unpredictable changes in governmental regulations affecting our markets and extreme weather conditions. For a further description of other relevant risk factors we refer to our Annual Report for 2019 and the Q4 2020 earnings release. As a result of these and other risk factors, actual events and our actual results may differ materially from those indicated in or implied by such forward-looking statements. The reservation is also made that inaccuracies or mistakes may occur in the information given above about current status of the Company or its business. Any reliance on the information above is at the risk of the reader, and PGS disclaims any and all liability in this respect.