CGG posts $124 million loss as the clock ticks on restructuring

French geophysical company CGG recorded a net loss of $124.4 million for 3Q 2017 on revenues of $320 million amid its financial restructuring process. 

This compares to $88 million net loss and revenues of $264 million in the prior-year third quarter, according to CGG’s financial report on Monday.

By the end of the third quarter 2017, CGG’s net debt increased to $2.57 billion from $2.3 billion in the last year’s third quarter.

Also on Monday, CGG is holding its extraordinary general meeting (EGM) for shareholders to approve the necessary resolutions for the implementation of the financial restructuring plan.

As previously reported by Offshore Energy Today, CGG on October 31 held the combined general meeting (ordinary and extraordinary) but could not resolve on the extraordinary part of the agenda to vote on the resolutions required to implement the financial restructuring plan due to a lack of a quorum. Subsequently, another meeting was scheduled for Monday, November 13 to vote only on the extraordinary part of the agenda.

In order to take into account the second meeting of the shareholders, the Commercial Court of Paris postponed the examination of the draft safeguard plan of CGG and the claim filed against it by certain holders of convertible bonds to November 20.

Subject to the approval of the EGM and the sanctioning of the draft safeguard plan by the French commercial court, CGG’s financial restructuring plan should be implemented in the first quarter of 2018.

However, if the shareholders general meeting were to reject the resolutions relating to the implementation of the safeguard plan, the group could be placed under judicial reorganization proceedings in the short term, be dismantled in the medium term, as the case may be in the context of judicial liquidation proceedings in various jurisdictions.

‘The next decisive step’

Related to CGG’s financial restructuring process, Jean-Georges Malcor, CGG CEO, said: “The next decisive step for CGG’s sustainability is the approval of the necessary resolutions to implement the financial restructuring plan at the shareholders’ Extraordinary General Meeting held today on second notice.

“This proposed plan would result in a $2 billion net debt reduction and would provide the necessary liquidity to support the company’s turnaround, while allowing shareholders to participate to the recovery.”

Offshore Energy Today Staff