Strong start to the year for PGS

The case is updated

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PGS reports an operating result (EBIT) of 26.7 million dollars in the first quarter of 2023, up from minus 16.1 million dollars in the same period last year.

Revenues went from $143.1 to $217.2 million.

– I am very pleased to see a good start for multi-client “late sales” in 2024, with progress in the first quarter and many active opportunities leading into the second quarter. We have a well-positioned and geographically diversified multi-client library that attracts great customer interest, says PGS CEO Rune Olav Pedersen in a comment.

So-called produced revenue came in at $222.6 million in the first quarter, up from $172.2 million in the same period last year. Produced operating profit before depreciation and amortization (EBITDA) went from 71.5 to 112.5 million dollars, while produced EBIT was reversed from minus 19.7 to 26.1 million dollars.

According to the company, new multi-client projects were mainly acquired in South America and the Mediterranean, with an achieved pre-financing of 106 percent of the capitalized investment. The expectation is that pre-financing will increase in the coming quarters from “financially robust” multi-client projects.

The income from the contract work in the first quarter is characterized as strong, and the project profitability was in line with the levels from the summer season 2023. Capacity utilization rose compared to the fourth quarter, but the company still increased standby time, which reflects a subdued purchasing market throughout the winter.

PGS landed several contracts towards the end of the quarter, and the order book increased compared to the previous quarter. At the end of the first quarter, it was up to 375 million dollars.

“Including recent allocations, we have booked most of our capacity well into the second half of the year at attractive prices,” the report states.

Regarding the imminent merger with TGS, the company writes that the British competition authorities will make their so-called “phase 1” decision no later than 11 June. The transaction is expected to be completed on or around July 1.