CGG Announces its 2019 Second Quarter Results

Paris, France | Jul 26, 2019

Strong Operational Performance & Cash Flow Generation Validate the Asset Light Strategy

CGG (ISIN: FR0013181864 – NYSE: CGG), world leader in Geoscience, announced today its 2019 second quarter unaudited results.

Q2 2019: Strong Revenue and Ebitda growth year-on- year

• IFRS figures: revenue at $335m, OPINC at $52m, net income at $(98)m
• Segment revenue at $340m, up 24% year-on-year
  • Geoscience: Focus on more profitable businesses
  • Multi-client: Solid sales with high prefunding
  • Equipment: Strong volume increase fueled by Land market
• Segment EBITDAs at $171m, up 51% year-on-year, a high 50% margin driven by increased profitability of Equipment and Geoscience
• Segment operating income at $53m, including $(37)m impact of the new multi-client amortization policy, stable year on year, a 16% margin, supported by favorable Multi-Client sales mix and increase in land Equipment volumes

H1 2019: Strong equipment recovery and positive cash generation

• IFRS figures: revenue at $607m, OPINC at $71m, net income at $(128)m
• Segment revenue at $623m, up 23% year-on-year
• Segment EBITDAs at $290m, up 46% year-on-year, a 47% margin
• Segment operating income at $64m, including $(64)m impact of the new multi-client amortization policy, a 10% margin

Sound Financial Situation

• H1 2019 Net Cash Flow of $13m
• Q2 2019 Net Cash Flow of $(31)m due to $(58)m negative change in working capital expected to be recovered in H2
• First semester net cash flow generation improvement of $147m
• Net debt of $741m before IFRS 16 at the end of June, liquidity of $441m and leverage ratio at 1.2x

Commenting on these results, Sophie Zurquiyah, CGG CEO, said:“I am very pleased to see the strong performance of CGG in the first half of 2019. As global offshore exploration continues to gradually recover and our clients maintain focus on improved efficiency, near field exploration and reservoir development, our Geoscience technology and services along with our portfolio of multi-client data are increasingly key profitability levers. Also, our Equipment business continued to benefit from the strong land equipment market. With the encouraging first half, we significantly improved cash generation as compared to last year and confirm our 2019 full year financial targets. The strategic partnership with Shearwater that we recently announced is a major milestone in our transition to an asset light, people, data, and technology company and we are well on track to close this transaction by year-end."

*For full financial records, please reference the Investors section of this website.*