Polarcus cold stacks ‘Nadia’. Reports 1Q net loss

Seismic acquisition companies are the first to feel the consequences when the oil prices go down, as their customers, the oil companies, stop investing in new exploration projects, waiting for the oil prices to rebound.

In line with this, seismic survey contractor Polarcus saw its 1Q 2015 revenues fall to $81.1 million, down 33% from the same quarter of 2014 due to a decrease in contract revenue.

The company also reported a net loss for the quarter of $26.4 million, versus a net income of $1 million in the corresponding quarter of 2014.

The seismic surveyor, responding to the weak market for seismic services, said it focused on building backlog for the year and reducing costs, resulting in improved utilization for Q12015 and a 13% reduced cost of sales compared to Q1 2014.

Also, to cut costs further, Polarcus said it would cold stack one of its seismic vessels, the Polarcus Nadia, a at the end of the first quarter.

The company says the move will deliver additional CAPEX and cost savings in 2015 as seismic equipment is reallocated to other vessels in the company’s fleet.

Rod Starr, Chief Executive Officer  said: “The current market environment can be best described as uncertain, as oil companies have continued to reduce or defer spending commitments making for a highly competitive landscape. In response, we have stayed true to the 2015 Agenda I announced in February; building backlog, reducing costs, and managing our balance sheet. This focus included the difficult yet necessary decision to cold stack Polarcus Nadia at the end of the quarter.

“Our Agenda is starting to deliver. Backlog visibility has grown to 70% for the year, costs are down 13% from first quarter 2014, and we have secured important amendments to our Fleet Back Facility and pushed back the date for our next bond maturity to 2018. We also recorded multi-client sales in the quarter of USD 36.7 million as our Capreolus 3D project offshore Australia passed the 50% completion milestone. All positive developments underpinned by continued safe and efficient operational performance in the field.

“We will continue to focus on these business fundamentals to successfully navigate through this uncertain market.”