Viridien · EURONEXT:VIRI
Viridien — CGG — Q4 2017 Earnings Presentation
27 slides from Viridien's earnings presentation, February 2018
Slide 1: 4th Quarter and Full-Year 2017 Financial Results
4th Quarter and Full-Year 2017 Financial Results Improved revenue and EBITDAs Financial restructuring process completed All results are presented before Non-Recurring Charges & write-offs, unless stated otherwise
Slide 2: Forward-looking statements
Forward-looking statements This presentation contains forward-looking statements, including, without limitation, statements about CGG (“the Company”) plans, strategies and prospects. These forward-looking statements are subject to risks and uncertainties that may change at any time, and, therefore,
Slide 3: Agenda
Agenda Operational review Financial review Group restructuring completed Conclusion 3
Slide 4: Operational review
Operational review Passion for Geoscience cA Cc G G
Slide 5: Q4 2017 key highlights
Q4 2017 key highlights Revenue at $401m, up 22% y-o-y GGR: strong multi-client sales in Brazil and North Sea Equipment: very strong volumes increase Contractual Data Acquisition: low Marine revenue as 75% of fleet dedicated to multi-client surveys EBITDAs at $134m up 34% y-o-y, a 33% margi
Slide 6: Full-year 2017 key highlights
Full-year 2017 key highlights Revenue at $1,320m, up 10% y-o-y GGR resilient with sustained multi-client sales boosted by Brazilian licensing rounds, North Sea and Gulf of Mexico Equipment external sales up 20% Contractual data acquisition: driven by two large contracts with high-end multi-s
Slide 7: GGR: solid multi-client sales
GGR: solid multi-client sales Revenue Total revenue at $820m, up 5% y-o-y SI & Reservoir (In million $) MC Revenue Multi-Client at $469m, up 22% y-o-y 1,108 Multi-client sales particularly active in Brazil, the North Sea and Gulf of Mexico 784 820 562 Prefunding revenue at $269m and after-sa
Slide 8: Equipment: volume increase, the key driver
Equipment: volume increase, the key driver Revenue Marine Equipment (In million $) Total sales at $241m, down (5)% y-o-y Land Equipment External sales up 20% at $216m ($179m in 2016) 437 Internal sales down 66% at $26m ($76m in 2016) 136 255 241 Sales split: 59% Land and 41% Marine 111 98 30
Slide 9: Contractual Data Acquisition: persistently weak market conditions
Contractual Data Acquisition: persistently weak market conditions Revenue Total revenue at $289m, up 21% y-o-y (In million $) Land & MP Marine revenue at $186m, up 40% y-o-y Marine Increase driven by two large contracts with high-end multi- 616 source vessel setup 177 52% allocation to marin
Slide 10: Non-Operated Resources (N.O.R.)
Non-Operated Resources (N.O.R.) OPINC EBITDAs at $(14)m (In million $) 2015 2016 2017 Operating Income at $(34)m Mainly amortization of excess streamers (28) (34) Global Seismic Shipping (GSS) implemented in Q2 2017 Four cold-stacked vessels transferred to the GSS joint venture (84) 10
Slide 11: Financial review
Financial review Passion for Geoscience cA Cc G G
Slide 12: 2017 full-year P&L
2017 full-year P&L In Million $ FY 2016 FY 2017 Var. Total Revenue 1,196 1,320 10% Group EBITDAs excluding NOR 350 387 10% NOR (22) (14) 36% Group EBITDAs 328 372 14% Group OPINC excluding NOR (128) (43) 66% NOR (84) (34) 60% Group OPINC (213) (77) 64% Equity from Investments (8) (20) (145)% Net fin
Slide 13: 2017 Financial indicators
2017 Financial indicators EBITDAs at $372m, up 14% y-o-y EBITDAs (In million $) $(40)m change in working capital 661 compared to strong positive $198m in 2016 328 372 Operating Cash Flow at $299m 31.4% 27.4% 28.2% Capex at $335m, down (15)% y-o-y Multi-client cash capex at $251m, 107% pr
Slide 14: Group restructuring completed
Group restructuring completed 14
Slide 15: Massive industrial transformation
Massive industrial transformation CGG’s revenue mix has improved towards less capex-intensive activities and its cost base has decreased by c. 50 to c. 80% over 2013-2017, leading to a more resilient business model CGG revenue mix evolution Total Capex(1) ($m) 862 22% c. (60)% 44% 16% 22% 415 395
Slide 16: A three-part financial restructuring plan
A three-part financial restructuring plan Full equitization of the principal amount of the unsecured debt leading to substantial Group deleveraging $2.0bn from $1.6bn Senior Notes and from $0.4bn OCEANEs Secured debt maturity extended to 2023, five years from restructuring closing date $664m
Slide 17: CGG pro forma post financial restructuring
CGG pro forma post financial restructuring Pre restructuring by YE 2017 Post restructuring/ Pro Forma basis • Gross Financial Debt of c. $3.0bn • Gross Financial Debt of c. $1.2bn • Liquidity at $315m • Liquidity at $575m • Net Debt of c. $2.65bn • Pro Forma Net Debt of c. $0.63bn • First maturity i
Slide 18: Restored capital structure post-restructuring
Restored capital structure post-restructuring Senior debt profile as of December 31, 2017 c. $3.0bn senior debt by year-end 2017 (including accrued interests) $1.15bn senior debt pro forma post- Restructuring Maturities extended to February 2023 and February 2024 Average cost of debt at 7.0%
Slide 19: $1bn Improvement
Enough liquidity to manage potential recovery delay $1bn Improvement Savings related to the Nordic & Fin. Restructuring: New liquidity: Nordic Restructuring: ~$275m Immediate cash injection: ~$300m Net reduction of finance costs: ~$225m Authorized floor of new secured debt: ~$200m 19
Slide 20: Significant leverage reduction
Significant leverage reduction Net debt reduction of ~$2.2bn post restructuring Leverage ratio below 2x 20
Slide 21: Conclusion
Conclusion (ccc cgg.com Passion for Geoscience
Slide 22: 2017: 10% revenue increase and 14% EBITDAs growth after three years of decline
2017: 10% revenue increase and 14% EBITDAs growth after three years of decline Group Revenue (In million $) 3,766 3,095 2,101 1,320 1,196 2013 2014 2015 2016 2017 Group EBITDAs Group OPINC (In million $) (In million $) 1 160 994 401 661 242 30.8% 372 61 2016 2017 32.1% 328 31.4% 27.4% 28.2% 2013 201
Slide 23: 2018 outlook
2018 outlook Revenue1 expected up at c. $1.5bn +/- 5% in a stabilized and still uncertain market EBITDAs1 margin within 35% - 40% range Multi-client cash capex at $275/325m with cash prefunding rate above 70% Industrial and R&D capex at $100/135m Cash cost of debt at c. $85m Industrial T
Slide 24: Thank you
Thank you (ccc Visit our website at cgg.com Passion for Geoscience
Slide 25: Appendix
CWCGG Passion for Geoscience Appendix cgg.com
Slide 26: Share count post financial restructuring on February 21, 2018
Share count post financial restructuring on February 21, 2018 Shares (actual Number of Subscription Subscription Parity Maturity and potential) Warrants price (€) price ($) * Initial share count 22 133 149 Rights Issue with PSR 71 932 731 Debtor shares 1 (OCEANES) 35 311 528 Debtor shares 2 (Senior
Slide 27: Company's financial outlook
Company’s financial outlook FYE 31/12 2016 2017 2018E 2019E - 2020E Revenue 1 $1.2bn $1.3bn ~$1.5bn ~$2.0bn EBITDA Margin 1 27.4% 28.2% 35.0% - 40.0% 37.5% - 42.5% $275m – $325m MC Capex $295m $251m (>70% cash prefunding rate) Industrial Capex $71m $47m $100m – $125m R&D Capex $34m $34m Stable at ~$