CGGVeritas announced today its non-audited first quarter 2011 consolidated results, group revenue at $728m, up 5% year-on-year and down 20% sequentially following a particularly strong fourth quarter.
Seasonally low multi-client sales and low fleet utilization contrasted with robust Sercel sales and a notable increase in Land revenue this quarter. Group Operating Income was $23m. Sercel performance was excellent with an operating income at $95m.
The company has reported that Services operating income was a loss of $26m mainly related to Marine. Services were also impacted by unrest in the Middle East and North Africa.
Multi-client contributions were low while the North American land winter campaign was particularly strong and Processing and Imaging sustained high levels of activity.
The company also reports a net free cash flow of $65m. CGG Veritas net debt to equity ratio was 38% improving sequentially from 41% at the end of 2010.
The company’s backlog as of April 1st was $1.22 billion in a market expected to progressively strengthen.
CGGVeritas CEO, Jean-Georges Malcor commented: “As previously communicated, the first quarter was shaped by our planned vessel upgrades, maritime interruptions, geopolitical unrest and multi-client seasonality. Sercel continued to generate excellent performance and Land had a particularly strong winter campaign.
During the quarter, we made significant progress on our performance plan which focuses on operational excellence and financial performance while further developing our technological and commercial edge. Our cost reduction program which is progressing well remains exposed to rising fuel costs and the weakening US dollar. Our commercial JVs are already actively building backlog and several vessels will be operating on BroadSeis projects in the coming months.
In the context of strong oil and gas fundamentals, along with the fast changing geopolitical and economic environment, we maintain our cash generation and performance improvement objectives and continue to position the company to fully benefit from the progressive strengthening seismic market in the second half.”
