Petroleum Geo-Services (PGS) has warned that its Q2 results will be weaker than current market expectations due to less predictable seismic purchases.
PGS said: "Customers' intentions with regard to seismic purchases, particularly MultiClient, have become less predictable recently."
PGS' 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 firm said.
Image: PGS' Ramform Challenger
PGS' comments echo those made by other geoscience firms, including CGG and TGS. Announcing its Q1 results, France’s CGG said the seismic market remained “flattish,” and “less favorable” in marine acquisition, “in a global context of reduced exploration and development spending.”
TGS said there was “some near-term uncertainty in how seismic spending will be impacted by conditions in 2014, “as several energy companies have indicated an intention to reduce exploration spending in the year.”
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PGS said, considering its Q2 results, it would lower its full year EBITDA guidance to circa US$850 million, adding that, because of the reduced predictability in the matket, the uncertainty range around the EBITDA guidance would be wider than normal.
PGS added: "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 mompany expects sales to be closed during 2H.
A more complete review of financial performance and market perspectives will be provided during the firm's Q2 results on 24 July.
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