Petroleum Geo-Services ASA (“PGS”) expects to report weaker Q2 results than current market expectations. Customers’ intentions with regard to seismic purchases, particularly MultiClient, have become less predictable recently. Accordingly, and considering the Q2 results, PGS lowers its full year EBITDA guidance to circa $850 million. It should be noted that because of this reduced predictability, the uncertainty range around the EBITDA guidance is wider than normal.
The weak Q2 results are mainly driven by lack of pre-funding for the Triton MultiClient survey in the Gulf of Mexico and to some extent by mobilization delays on some Marine Contract surveys, relating to permitting, weather and technical problems.
The Company expects to report consolidated Q2 revenues of approximately $335 million; EBITDA of approximately $170 million and EBIT before impairments of approximately $55 million. In addition, an impairment charge of approximately $10 million is expected related to vessel and equipment retirement.
With the exception of the delay in securing pre-funding for the Triton survey, MultiClient pre-funding is progressing well. Excluding investment in the Triton survey, the Q2 pre-funding for the remaining MultiClient portfolio is approximately 150% of capitalized MultiClient cash investment.
With respect to Triton, a fast track product from the survey is now available and the Company expects sales to be closed during 2H.