CGG has released a solid operational performance in its fourth quarter results and positive net cash flow sustained by gradual recovery from COVID-19.
Commenting on the company’s full year and fourth quarter results, CGG CEO Sophie Zurquiyah said:
“In the particularly challenging year of 2020, which saw the collapse of the oil & gas market across the second and third quarters, we finished the year with solid fourth quarter operational performance. During 2020, we successfully completed our exit from the Acquisition business while continuing to advance our high-end Geoscience technologies for reservoir development and production.
“We also delivered our Multi-client surveys in the industry’s core mature sedimentary basins and released new products while reinforcing our market leadership in equipment. Our initiatives towards energy transition are accelerating with the development and commercialization of new business offerings, along with our announced target to achieve carbon neutrality by 2050.
“Looking forward, as global economies continue to progressively recover and with oil price stabilizing above $50/bbl, we expect CGG’s performance to benefit from the proactive cost reduction actions and gradually strengthen in the second half of the year, delivering positive net cash flow in 2021.“
Full Year 2020 revenue was hampered by the impact of the Covid-19 pandemic, showing revenue of $886m and EBITDAs of $292m. Segment revenue of $955m was down 32% year-on-year.
CGG said it was is in a strong position to benefit from progressive market recovery.
“With continuing acceleration of Covid-19 vaccinations world economies should continue to progressively recover from pandemic in 2021. Recent OPEC+ agreements support the rebalancing of supply and demand and Brent oil price has gradually recovered and stabilized above the $50/bbl threshold,” CGG said.
CGG said it would continue to invest in geoscience technologies that support clients’ prioritization towards reservoir development and production optimization.
“After a low Q1, our geoscience activity will start recovering during the second half of the year on the back of solid demand for best-in-class subsurface imaging technologies and sustained activity with large NOCs. Our Multi-client business will reduce capex keeping its focus on expanding our unique footprint offshore Brazil and in the North Sea while reprocessing existing data libraries with our latest imaging technologies.
“Our Equipment business should benefit from solid deliveries for land mega crews in Saudi Arabia in H1 and improved demand for its large portfolio of WING nodes onshore and GPR nodes offshore.”