PGS has reported a fourth quarter overall net loss of $60 million on segment revenues and other income of $173 million compared to a net profit of $28.5 million on segment revenues of $288 million in the fourth quarter of 2019.
PGS has reported a fourth quarter overall net loss of $60 million on segment revenues and other income of $173 million compared to a net profit of $28.5 million on segment revenues of $288 million in the fourth quarter of 2019.
The company made an operating loss of $22 million compared with an operating profit of $54 million in Q4 2019.
For the full year of 2020 PGS reported a net loss of $321.5 million on segment revenue and other income of $596 million, compared to a net loss of $72 million on segment revenues of $880.1 million in 2019. Operating profit (excluding impairments and other charges) was $12.2 million, compared to $96.4 million in 2019.
Segment multi-client pre-funding revenues of $218.6 million, with a corresponding pre-funding level of 98%, compared to $256.5 million and 105% in 2019.
Cash flow from operations was $366.5 million, compared to $474.3 million in 2019.
PGS reported an impairment charge of $108.4 million in 2020, partly related to stacked vessels. It also recorded government grants relating to the Covid-19 pandemic of $38.8 million in 2020
It has reduced annual gross cash costs by more than $200 million (compared to the initial 2020 plan) to compensate for a revenue reduction of 37% caused by the Covid-19 pandemic.
All debt maturities and amortization have been extended to September 2022 and beyond.
Rune Olav Pedersen, president and chief executive officer, said: ‘In Q1 the seismic market quickly changed from an improving path to an abrupt downturn. Goss 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.
‘Multi-client late sales in the fourth quarter benefited from a usual end-of-year increase and licence round activity in West Africa and Brazil. New acquisitions of multi-client 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 multi-client surveys acquired in earlier quarters but still in the processing phase, boosting our pre-funding level to 185% on multi-client 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 reschedule debt maturities and amortizations that we had agreed with an overwhelming majority of lenders. An English court sanctioned the scheme on 2 February.
PGS said it expects the improved oil price, a probable 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. 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.
In 2021 multi-client cash investments are expected to be approximately $150 million.
Capital expenditure for 2021 is expected to be approx. $40 million.
The order book totalled $202 million on December 31, 2020 (including $89 million relating to multi-client). The order book was $160 million on September 30, 2020 and $322 million on December 31, 2019.
