PARIS, France – August 2nd 2018 – CGG (ISIN: FR0013181864 – NYSE: CGG), world leader in Geoscience, announced today its 2018 second quarter unaudited results.
1Based on transitory IFRS 15 application
2Segment figures presented before IFRS 15 and Non-Recurring Charges (NRC)
Commenting on these results, Sophie Zurquiyah, CGG CEO, said:“The second quarter results were in line with our expectations with a stable EBITDAs margin year-over-year. SIR performed well and Multi-Client after-sales were particularly high with significant contribution from the North Sea. Prefunding was low, primarily as a result of regulatory delays. Equipment saw strong volume increase and returned to breakeven. Contractual Data Acquisition activities were still under pressure with continued low prices.
Priority is to focus on cash generation, and specifically this quarter cash consumption was limited due to rigorous management of working capital.
In the context of a gradual market improvement, while clients maintain a cautious approach to spending, we remain on track to meet our targets for 2018.”
Transitory first time application of IFRS 15
Discussions between CGG, its auditors and the regulators are still on going. CGG continues advocating for the IFRS 15 compliance of revenue recognition policy based on the two distinct performance obligations contained in these contracts.
In the absence of a finalized IFRS 15 accounting policy, prior to the Group’s second quarter 2018 results, CGG decided to continue presenting a dual approach:
(i) one set of figures (the “IFRS” figures) in line with the accounting practice adopted by some other seismic players, with pre-commitment revenue recognized in full only upon delivery of the final data, and
(ii) a second set of figures (the “Segment Figures”) corresponding to the figures used for internal management reporting purposes and produced in accordance with the Group’s historical method (percentage of completion for multi-clients pre-commitments).
The Company aims to fix a definitive approach with its auditors and the regulators ideally prior to the release of Q3 2018 financial statements and at the latest for the 2018 annual report.
Please find below tables for key IFRS figures, segment figures and bridges; please refer to our 6-K document for full IFRS financial statements.
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