TGS: Record Fourth Quarter Helps to Achieve Annual Guidance

Following its update on 13 January, TGS now confirms net revenues of USD 298 million in Q4 2014, up 10% from USD 271 million in Q4 2013 and representing a record high for the Company.  TGS achieved its 2014 guided revenues with full year net revenues of USD 915 million, up 4% from USD 883 million in 2013.

4^th QUARTER HIGHLIGHTS

• Consolidated net revenues were USD 298 million, compared to USD 271 million in Q4 2013.
• Net late sales totaled USD 226 million, up 4% from USD 218 million in Q4 2013.
• Net pre-funding revenues were USD 62 million, up 44% from Q4 2013, funding 49% of the Company’s operational multi-client investments during Q4 (investments of USD 126 million, up 37% from Q4 2013).
• Proprietary revenues were USD 9 million, compared to USD 10 million in Q4 2013.
• Operating profit (EBIT) was USD 47 million (16% of net revenues), compared to USD 120 million (44% of net revenues) in Q4 2013. Following a decision to close the Reservoir Solutions business, TGS made an impairment in Q4 2014 of USD 54.4 million (USD 50.2 million after reversal of a related deferred tax liability recognized as tax income). Also, an impairment of USD 9.5 million has been recognized related to a fair-value assessment of other non-current assets. Adjusted for the impairment costs, operating profit was USD 111 million (37% of net revenues).
• Cash flow from operations was USD 131 million, compared to USD 215 million in Q4 2013.
• Earnings per share (fully diluted) were USD 0.31, down from USD 0.81 in Q4 2013.

FULL YEAR 2014 FINANCIAL HIGHLIGHTS

• Consolidated net revenues were USD 915 million, up from USD 883 million in 2013.
• Net late sales from the multi-client library totaled USD 631 million, down 1% from USD 638 million in 2013.
• Net pre-funding revenues were USD 247 million, up 33% from 2013, funding 53% of the Company’s operational multi-client investments during 2014 (investments of USD 462 million, up 5% from 2013).
• Proprietary revenues were USD 37 million, compared to USD 59 million in 2013.
• Operating profit (EBIT) was USD 295 million (32% of net revenues), compared to USD 387 million (44% of net revenues) in 2013. Adjusted for the impairment costs related to the closure of the Reservoir Solutions business and the re-assessment of the fair value of other non-current assets, operating profit was USD 358 million (39% of net revenues).
• Cash flow from operations was USD 605 million compared to USD 543 million in 2013, an increase of 11%.
• Earnings per share (fully diluted) were USD 2.09, down from 2.59 in 2013.

“We are very pleased to announce a record fourth quarter and end of year 2014, which helped us to reach our annual guidance despite challenging market conditions. Q4 was marked by continued strong late sales from our high-quality data library and we set a new record for late sales in the quarter. For 2015, we expect continued downward pressure on exploration spending based on lower oil prices. TGS is entering into 2015 with a record high order backlog and will continue to capitalize on the asset-light business model and strong balance sheet,” TGS’ CEO Robert Hobbs stated.