ION Reports $0.41 EPS
ION Geophysical has reported third quarter 2017 net income of $4.9 million, or $0.41 per diluted share, on revenues of $61.1 million, compared to net income of $1.7 million, or $0.14 per diluted share, on revenues of $78.6 million in third quarter 2016.
The company reported Adjusted EBITDA of $27.1 million for third quarter 2017, compared to $24.4 million in the same period last year.
Net cash flows from operations were $6.4 million during the third quarter 2017, compared to $15.6 million in third quarter 2016. Total net cash flows, including investing and financing activities, were $(3.0) million, compared to $10.1 million in third quarter 2016. The decline in net cash flows was a result of the significant increase in accounts and unbilled receivables at September 30, 2017, of which a majority of the balances are expected to be collected during the fourth quarter 2017.
Brian Hanson, ION’s president and CEO, said: “We are a niche business in the larger E&P market, so we target geographic areas and production optimization opportunities less dependent on cycle recovery, and where our differentiated technologies bring significant value. These efforts have begun to pay off and support the recovery of our business.
“Continuing the strong momentum of the first and second quarters, our third quarter revenues increased sequentially by 33%, driven by continued strong sales of our 3D multi-client reimaging programs as well as new 2D programs we have recently launched. Excluding the OBS Services revenues from the prior year, our revenues of $61 million are up 26% over the third quarter of last year. We reported a net income of $5 million and Adjusted EBITDA of $27.1 million for the third quarter, doubling our Adjusted EBITDA for the first and second quarters of this year combined. Overall, our third quarter was stronger than anticipated and we expect to finish the year strong.
“We experienced a significant increase in our accounts and unbilled receivables during the quarter and their collection, combined with expected year-end customer spending on data libraries, should result in significant cash generation during the fourth quarter. This should lead to a meaningful increase in our liquidity, which in turn positions us well for the third lien bond maturity in May 2018.”
For the first nine months of 2017, the company reported a net loss of $28.8 million, or $(2.43) per share, on revenues of $139.7 million, compared to a net loss of $58.7 million, or $(5.21) per share, on revenues of $137.4 million in the first nine months of 2016. Excluding special items in both periods, the company reported an adjusted net loss of $23.8 million, or $(2.01) per share, compared to an adjusted net loss of $54.5 million, or $(4.83) per share in the first nine months of 2016.
First nine months of 2017 Adjusted EBITDA was $40.7 million, compared to $3.9 million in the first nine months of 2016. Net cash flow from operations was $10.0 million, compared to $3.2 million in the first nine months of 2016. Total net cash flows, including investing and financing activities, were $(12.4) million, compared to $(22.4) million in the first nine months of 2016.
As of September 30, 2017, the company had total liquidity of $52.3 million, consisting of $40.2 million of cash on hand and $12.1 million of undrawn borrowing base available under its revolving credit facility.