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Share Name | Share Symbol | Market | Type |
---|---|---|---|
ION Geophysical Corporation New | NYSE:IO | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0.345 | 0 | 01:00:00 |
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|
ý
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
DELAWARE
|
|
22-2286646
|
(State or other jurisdiction of
|
|
(I.R.S. Employer
|
incorporation or organization)
|
|
Identification No.)
|
2105 CityWest Blvd.
|
|
|
Suite 100
|
|
|
Houston, Texas
|
|
77042-2839
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
Large accelerated filer
|
|
o
|
|
Accelerated filer
|
ý
|
|
|
|
|
|
|
Non-accelerated filer
|
|
o
(Do not check if a smaller reporting company)
|
|
Smaller reporting company
|
o
|
|
|
|
|
|
|
|
|
|
|
Emerging growth company
|
o
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|
PAGE
|
PART I. Financial Information
|
|
Item 1. Financial Statements
|
|
Condensed Consolidated Balance Sheets as of June 30, 2017 and December 31, 2016
|
|
Condensed Consolidated Statements of Operations for the three- and six-months ended June 30, 2017 and 2016
|
|
Condensed Consolidated Statements of Comprehensive Loss for the three- and six-months ended June 30, 2017 and 2016
|
|
Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2017 and 2016
|
|
Footnotes to Unaudited Condensed Consolidated Financial Statements
|
|
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
Item 3. Quantitative and Qualitative Disclosures about Market Risk
|
|
Item 4. Controls and Procedures
|
|
|
|
PART II. Other Information
|
|
Item 1. Legal Proceedings
|
|
Item 1A. Risk Factors
|
|
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
|
|
Item 5. Other Information
|
|
Item 6. Exhibits
|
|
June 30, 2017
|
|
December 31, 2016
|
||||
|
(In thousands, except share data)
|
||||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
43,272
|
|
|
$
|
52,652
|
|
Accounts receivable, net
|
18,992
|
|
|
20,770
|
|
||
Unbilled receivables
|
18,883
|
|
|
13,415
|
|
||
Inventories
|
14,623
|
|
|
15,241
|
|
||
Prepaid expenses and other current assets
|
5,866
|
|
|
9,559
|
|
||
Total current assets
|
101,636
|
|
|
111,637
|
|
||
Property, plant, equipment and seismic rental equipment, net
|
58,899
|
|
|
67,488
|
|
||
Multi-client data library, net
|
96,844
|
|
|
105,935
|
|
||
Goodwill
|
23,354
|
|
|
22,208
|
|
||
Intangible assets, net
|
2,386
|
|
|
3,103
|
|
||
Other assets
|
1,733
|
|
|
2,845
|
|
||
Total assets
|
$
|
284,852
|
|
|
$
|
313,216
|
|
LIABILITIES AND EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Current maturities of long-term debt
|
$
|
39,983
|
|
|
$
|
14,581
|
|
Accounts payable
|
24,478
|
|
|
26,889
|
|
||
Accrued expenses
|
30,266
|
|
|
26,240
|
|
||
Accrued multi-client data library royalties
|
22,651
|
|
|
23,663
|
|
||
Deferred revenue
|
9,276
|
|
|
3,709
|
|
||
Total current liabilities
|
126,654
|
|
|
95,082
|
|
||
Long-term debt, net of current maturities
|
116,206
|
|
|
144,209
|
|
||
Other long-term liabilities
|
18,577
|
|
|
20,527
|
|
||
Total liabilities
|
261,437
|
|
|
259,818
|
|
||
Equity:
|
|
|
|
||||
Common stock, $0.01 par value; authorized 26,666,667 shares; outstanding 11,883,690 and 11,792,447 shares at June 30, 2017 and December 31, 2016, respectively
|
119
|
|
|
118
|
|
||
Additional paid-in capital
|
900,574
|
|
|
899,198
|
|
||
Accumulated deficit
|
(858,462
|
)
|
|
(824,679
|
)
|
||
Accumulated other comprehensive loss
|
(20,032
|
)
|
|
(21,748
|
)
|
||
Total stockholders’ equity
|
22,199
|
|
|
52,889
|
|
||
Noncontrolling interest
|
1,216
|
|
|
509
|
|
||
Total equity
|
23,415
|
|
|
53,398
|
|
||
Total liabilities and equity
|
$
|
284,852
|
|
|
$
|
313,216
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(In thousands, except per share data)
|
||||||||||||||
Service revenues
|
$
|
34,454
|
|
|
$
|
25,430
|
|
|
$
|
58,282
|
|
|
$
|
38,586
|
|
Product revenues
|
11,547
|
|
|
10,722
|
|
|
20,275
|
|
|
20,231
|
|
||||
Total net revenues
|
46,001
|
|
|
36,152
|
|
|
78,557
|
|
|
58,817
|
|
||||
Cost of services
|
24,827
|
|
|
27,175
|
|
|
47,126
|
|
|
53,012
|
|
||||
Cost of products
|
5,556
|
|
|
4,124
|
|
|
9,712
|
|
|
9,882
|
|
||||
Gross profit (loss)
|
15,618
|
|
|
4,853
|
|
|
21,719
|
|
|
(4,077
|
)
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Research, development and engineering
|
4,107
|
|
|
4,761
|
|
|
7,602
|
|
|
10,370
|
|
||||
Marketing and sales
|
4,931
|
|
|
4,684
|
|
|
9,417
|
|
|
8,694
|
|
||||
General, administrative and other operating expenses
|
10,152
|
|
|
11,996
|
|
|
22,184
|
|
|
23,576
|
|
||||
Total operating expenses
|
19,190
|
|
|
21,441
|
|
|
39,203
|
|
|
42,640
|
|
||||
Loss from operations
|
(3,572
|
)
|
|
(16,588
|
)
|
|
(17,484
|
)
|
|
(46,717
|
)
|
||||
Interest expense, net
|
(4,241
|
)
|
|
(4,702
|
)
|
|
(8,705
|
)
|
|
(9,436
|
)
|
||||
Other income (expense), net
|
192
|
|
|
(1,717
|
)
|
|
(4,876
|
)
|
|
(1,597
|
)
|
||||
Loss before income taxes
|
(7,621
|
)
|
|
(23,007
|
)
|
|
(31,065
|
)
|
|
(57,750
|
)
|
||||
Income tax expense
|
2,402
|
|
|
2,256
|
|
|
1,984
|
|
|
2,549
|
|
||||
Net loss
|
(10,023
|
)
|
|
(25,263
|
)
|
|
(33,049
|
)
|
|
(60,299
|
)
|
||||
Net income attributable to noncontrolling interests
|
(418
|
)
|
|
(79
|
)
|
|
(734
|
)
|
|
(57
|
)
|
||||
Net loss attributable to ION
|
$
|
(10,441
|
)
|
|
$
|
(25,342
|
)
|
|
$
|
(33,783
|
)
|
|
$
|
(60,356
|
)
|
Net loss per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.88
|
)
|
|
$
|
(2.22
|
)
|
|
$
|
(2.85
|
)
|
|
$
|
(5.48
|
)
|
Diluted
|
$
|
(0.88
|
)
|
|
$
|
(2.22
|
)
|
|
$
|
(2.85
|
)
|
|
$
|
(5.48
|
)
|
Weighted average number of common shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic
|
11,875
|
|
|
11,415
|
|
|
11,847
|
|
|
11,008
|
|
||||
Diluted
|
11,875
|
|
|
11,415
|
|
|
11,847
|
|
|
11,008
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(In thousands)
|
||||||||||||||
Net loss
|
$
|
(10,023
|
)
|
|
$
|
(25,263
|
)
|
|
$
|
(33,049
|
)
|
|
$
|
(60,299
|
)
|
Other comprehensive loss, net of taxes, as appropriate:
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments
|
1,199
|
|
|
(2,737
|
)
|
|
1,716
|
|
|
(4,199
|
)
|
||||
Comprehensive net loss
|
(8,824
|
)
|
|
(28,000
|
)
|
|
(31,333
|
)
|
|
(64,498
|
)
|
||||
Comprehensive income attributable to noncontrolling interest
|
(418
|
)
|
|
(79
|
)
|
|
(734
|
)
|
|
(57
|
)
|
||||
Comprehensive net loss attributable to ION
|
$
|
(9,242
|
)
|
|
$
|
(28,079
|
)
|
|
$
|
(32,067
|
)
|
|
$
|
(64,555
|
)
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Cash flows from operating activities:
|
|
|
|
||||
Net loss
|
$
|
(33,049
|
)
|
|
$
|
(60,299
|
)
|
Adjustments to reconcile net loss to cash provided by (used in) operating activities:
|
|
|
|
||||
Depreciation and amortization (other than multi-client data library)
|
9,030
|
|
|
11,416
|
|
||
Amortization of multi-client data library
|
21,933
|
|
|
14,244
|
|
||
Stock-based compensation expense
|
1,169
|
|
|
1,610
|
|
||
Accrual for loss contingency related to legal proceedings
|
5,000
|
|
|
—
|
|
||
Loss on extinguishment of debt
|
—
|
|
|
2,182
|
|
||
Deferred income taxes
|
(932
|
)
|
|
381
|
|
||
Change in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
2,075
|
|
|
23,980
|
|
||
Unbilled receivables
|
(5,542
|
)
|
|
(2,042
|
)
|
||
Inventories
|
440
|
|
|
1,329
|
|
||
Accounts payable, accrued expenses and accrued royalties
|
(6,059
|
)
|
|
(5,518
|
)
|
||
Deferred revenue
|
5,521
|
|
|
1,151
|
|
||
Other assets and liabilities
|
4,053
|
|
|
(773
|
)
|
||
Net cash provided by (used in) operating activities
|
3,639
|
|
|
(12,339
|
)
|
||
Cash flows from investing activities:
|
|
|
|
||||
Cash invested in multi-client data library
|
(8,482
|
)
|
|
(8,648
|
)
|
||
Purchase of property, plant, equipment and seismic rental assets
|
(915
|
)
|
|
(340
|
)
|
||
Net cash used in investing activities
|
(9,397
|
)
|
|
(8,988
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Borrowings under revolving line of credit
|
—
|
|
|
15,000
|
|
||
Payments on notes payable and long-term debt
|
(3,157
|
)
|
|
(4,786
|
)
|
||
Costs associated with issuance of debt
|
—
|
|
|
(6,174
|
)
|
||
Payment to repurchase bonds
|
—
|
|
|
(15,000
|
)
|
||
Repurchase of common stock
|
—
|
|
|
(964
|
)
|
||
Costs associated with issuance of equity
|
(123
|
)
|
|
—
|
|
||
Other financing activities
|
(173
|
)
|
|
13
|
|
||
Net cash used in financing activities
|
(3,453
|
)
|
|
(11,911
|
)
|
||
Effect of change in foreign currency exchange rates on cash and cash equivalents
|
(169
|
)
|
|
738
|
|
||
Net decrease in cash, and cash equivalents
|
(9,380
|
)
|
|
(32,500
|
)
|
||
Cash and cash equivalents at beginning of period
|
52,652
|
|
|
84,933
|
|
||
Cash and cash equivalents at end of period
|
$
|
43,272
|
|
|
$
|
52,433
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Net revenues:
|
|
|
|
|
|
|
|
||||||||
E&P Technology & Services:
|
|
|
|
|
|
|
|
||||||||
New Venture
|
$
|
19,986
|
|
|
$
|
4,579
|
|
|
$
|
26,935
|
|
|
$
|
7,885
|
|
Data Library
|
9,710
|
|
|
6,275
|
|
|
20,316
|
|
|
10,547
|
|
||||
Total multi-client revenues
|
29,696
|
|
|
10,854
|
|
|
47,251
|
|
|
18,432
|
|
||||
Imaging Services
|
4,186
|
|
|
7,764
|
|
|
9,941
|
|
|
13,204
|
|
||||
Total
|
33,882
|
|
|
18,618
|
|
|
57,192
|
|
|
31,636
|
|
||||
E&P Operations Optimization:
|
|
|
|
|
|
|
|
||||||||
Devices
|
7,679
|
|
|
6,626
|
|
|
12,669
|
|
|
11,985
|
|
||||
Optimization Software & Services
|
4,440
|
|
|
4,475
|
|
|
8,696
|
|
|
8,763
|
|
||||
Total
|
12,119
|
|
|
11,101
|
|
|
21,365
|
|
|
20,748
|
|
||||
Ocean Bottom Seismic Services
|
—
|
|
|
6,433
|
|
|
—
|
|
|
6,433
|
|
||||
Total
|
$
|
46,001
|
|
|
$
|
36,152
|
|
|
$
|
78,557
|
|
|
$
|
58,817
|
|
Gross profit (loss):
|
|
|
|
|
|
|
|
||||||||
E&P Technology & Services
|
$
|
11,921
|
|
|
$
|
(3,533
|
)
|
|
$
|
15,931
|
|
|
$
|
(13,306
|
)
|
E&P Operations Optimization
|
6,258
|
|
|
5,064
|
|
|
11,045
|
|
|
9,783
|
|
||||
Ocean Bottom Seismic Services
|
(2,561
|
)
|
|
3,322
|
|
|
(5,257
|
)
|
|
(554
|
)
|
||||
Total
|
$
|
15,618
|
|
|
$
|
4,853
|
|
|
$
|
21,719
|
|
|
$
|
(4,077
|
)
|
Gross margin:
|
|
|
|
|
|
|
|
||||||||
E&P Technology & Services
|
35
|
%
|
|
(19
|
)%
|
|
28
|
%
|
|
(42
|
)%
|
||||
E&P Operations Optimization
|
52
|
%
|
|
46
|
%
|
|
52
|
%
|
|
47
|
%
|
||||
Ocean Bottom Seismic Services
|
—
|
%
|
|
52
|
%
|
|
—
|
%
|
|
(9
|
)%
|
||||
Total
|
34
|
%
|
|
13
|
%
|
|
28
|
%
|
|
(7
|
)%
|
||||
Income (loss) from operations:
|
|
|
|
|
|
|
|
||||||||
E&P Technology & Services
|
$
|
6,353
|
|
|
$
|
(9,410
|
)
|
|
$
|
5,257
|
|
|
$
|
(24,124
|
)
|
E&P Operations Optimization
|
3,022
|
|
|
1,882
|
|
|
4,571
|
|
|
3,483
|
|
||||
Ocean Bottom Seismic Services
|
(3,860
|
)
|
|
360
|
|
|
(7,868
|
)
|
|
(7,271
|
)
|
||||
Support and other
|
(9,087
|
)
|
|
(9,420
|
)
|
|
(19,444
|
)
|
|
(18,805
|
)
|
||||
Loss from operations
|
(3,572
|
)
|
|
(16,588
|
)
|
|
(17,484
|
)
|
|
(46,717
|
)
|
||||
Interest expense, net
|
(4,241
|
)
|
|
(4,702
|
)
|
|
(8,705
|
)
|
|
(9,436
|
)
|
||||
Other income (expense), net
|
192
|
|
|
(1,717
|
)
|
|
(4,876
|
)
|
|
(1,597
|
)
|
||||
Loss before income taxes
|
$
|
(7,621
|
)
|
|
$
|
(23,007
|
)
|
|
$
|
(31,065
|
)
|
|
$
|
(57,750
|
)
|
|
|
|
|
|
|
|
|
Obligations (in thousands)
|
|
June 30, 2017
|
|
December 31, 2016
|
||||
Senior secured second-priority lien notes
(maturing December 15, 2021)
|
|
$
|
120,569
|
|
|
$
|
120,569
|
|
Senior secured third-priority lien notes
(maturing May 15, 2018)
|
|
28,497
|
|
|
28,497
|
|
||
Revolving line of credit
(maturing August 22, 2019)
|
|
10,000
|
|
|
10,000
|
|
||
Equipment capital leases
|
|
1,365
|
|
|
3,446
|
|
||
Other debt
|
|
341
|
|
|
1,415
|
|
||
Costs associated with issuances of debt
(1)
|
|
(4,583
|
)
|
|
(5,137
|
)
|
||
Total
|
|
156,189
|
|
|
158,790
|
|
||
Current portion of long-term debt and lease obligations
(2)
|
|
(39,983
|
)
|
|
(14,581
|
)
|
||
Non-current portion of long-term debt and lease obligations
|
|
$
|
116,206
|
|
|
$
|
144,209
|
|
(1)
|
Represents debt issuance costs presented as a direct deduction from the carrying amount of the debt liability associated with the Senior Secured second-priority and senior secured third-priority lien notes. These amounts do not include
$0.7 million
and
$1.2 million
of debt issuance costs associated with the Revolving Credit Facility as of June 30, 2017 and December 31, 2016 respectively, which are included within other assets on the balance sheet.
|
(2)
|
Includes
$28.5 million
Senior secured third-priority lien notes reclassified from long-term to current during the second quarter 2017.
|
•
|
increased the applicable margin for loans by
0.50%
per annum (from
2.50%
per annum to
3.00%
per annum for alternate base rate loans and from
3.50%
per annum to
4.00%
per annum for LIBOR-based loans);
|
•
|
increased the minimum excess availability threshold to avoid triggering the agent’s rights to exercise dominion over cash and deposit accounts and increases certain of the thresholds upon which such dominion ceases;
|
•
|
increased the minimum liquidity threshold to avoid triggering the Company’s obligation to calculate and comply with the existing fixed charge coverage ratio and increased certain of the thresholds upon which such required calculation and compliance cease;
|
•
|
establish a reserve that will reduce the amount available to be borrowed by the aggregate amount owing under all Third Lien Notes that remain outstanding (if any) on or after February 14, 2018 (i.e.,
90
days prior to the stated maturity of the Third Lien Notes);
|
•
|
increased the maximum amount of certain permitted junior indebtedness to
$200.0 million
(from $
175.0 million
);
|
•
|
incorporated technical and conforming changes to reflect that the Second Lien Notes and the remaining Third Lien Notes (and any permitted refinancing thereof or subsequently incurred replacement indebtedness meeting certain requirements) constitute permitted indebtedness;
|
•
|
clarified the circumstances and mechanics under which the Company may prepay, repurchase or redeem the Second Lien Notes, the remaining Third Lien Notes and certain other junior indebtedness;
|
•
|
modified the cross-default provisions to incorporated defaults under the Second Lien Notes, the remaining Third Lien Notes and certain other junior indebtedness; and
|
•
|
eliminated the potential early commitment termination date and early maturity date that would otherwise have occurred ninety (
90
) days prior to the maturity date of the Third Lien Notes if any of the Third Lien Notes then remained outstanding.
|
Date
|
|
Percentage
|
2015
|
|
104.063%
|
2016
|
|
102.031%
|
2017 and thereafter
|
|
100.000%
|
Date
|
|
Percentage
|
2019
|
|
105.500%
|
2020
|
|
103.500%
|
2021 and thereafter
|
|
100.000%
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Accrual for loss related to legal proceedings (Footnote 6)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(5,000
|
)
|
|
$
|
—
|
|
Loss on bond exchange
|
—
|
|
|
(2,182
|
)
|
|
—
|
|
|
(2,182
|
)
|
||||
Other income, net
|
192
|
|
|
465
|
|
|
124
|
|
|
585
|
|
||||
Total other income (expense), net
|
$
|
192
|
|
|
$
|
(1,717
|
)
|
|
$
|
(4,876
|
)
|
|
$
|
(1,597
|
)
|
The following table is a summary of inventories (in thousands):
|
June 30, 2017
|
|
December 31, 2016
|
||||
Raw materials and subassemblies
|
$
|
21,216
|
|
|
$
|
21,454
|
|
Work-in-process
|
724
|
|
|
2,255
|
|
||
Finished goods
|
7,649
|
|
|
6,581
|
|
||
Reserve for excess and obsolete inventories
|
(14,966
|
)
|
|
(15,049
|
)
|
||
Total
|
$
|
14,623
|
|
|
$
|
15,241
|
|
The following table is a summary of other long-term liabilities (in thousands):
|
June 30, 2017
|
|
December 31, 2016
|
||||
Deferred rents
|
13,410
|
|
|
13,955
|
|
||
Facility restructuring accrual
|
—
|
|
|
1,765
|
|
||
Deferred income tax liability
|
2,740
|
|
|
3,679
|
|
||
Other long-term liabilities
|
2,427
|
|
|
1,128
|
|
||
Total
|
$
|
18,577
|
|
|
$
|
20,527
|
|
|
|
Foreign currency translation adjustments
|
|
Total
|
||||
Accumulated other comprehensive loss at December 31, 2016
|
|
$
|
(21,748
|
)
|
|
$
|
(21,748
|
)
|
Net current-period other comprehensive loss
|
|
1,716
|
|
|
1,716
|
|
||
Accumulated other comprehensive loss at June 30, 2017
|
|
$
|
(20,032
|
)
|
|
$
|
(20,032
|
)
|
|
|
|
|
|
|
Six Months Ended June 30,
|
|
||||||
|
2017
|
|
2016
|
|
||||
Cash paid during the period for:
|
|
|
|
|
||||
Interest
|
$
|
7,075
|
|
|
$
|
8,149
|
|
|
Income taxes (refunds)
|
2,364
|
|
|
(6
|
)
|
|
||
Non-cash items from investing and financing activities:
|
|
|
|
|
||||
Investment in multi-client data library in accounts payable and accrued expenses
|
4,561
|
|
|
—
|
|
|
||
Bond exchange
|
—
|
|
|
10,740
|
|
(a)
|
(a)
|
This represents the non cash portion of the bond exchange.
|
|
Stock Options
|
|
Restricted Stock and Unit Awards
|
||
|
Number of Shares
|
||||
Outstanding at December 31, 2016
|
847,635
|
|
|
285,308
|
|
Granted
|
—
|
|
|
17,500
|
|
Stock options exercised/restricted stock/unit awards vested
|
—
|
|
|
(115,133
|
)
|
Cancelled/forfeited
|
(9,053
|
)
|
|
—
|
|
Outstanding at June 30, 2017
|
838,582
|
|
|
187,675
|
|
•
|
ION Geophysical Corporation and the Guarantors (in each case, reflecting investments in subsidiaries utilizing the equity method of accounting).
|
•
|
All other subsidiaries of ION Geophysical Corporation that are not Guarantors.
|
•
|
The consolidating adjustments necessary to present ION Geophysical Corporation’s results on a consolidated basis.
|
|
June 30, 2017
|
||||||||||||||||||
Balance Sheet
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
18,258
|
|
|
$
|
—
|
|
|
$
|
25,014
|
|
|
$
|
—
|
|
|
$
|
43,272
|
|
Accounts receivable, net
|
—
|
|
|
8,640
|
|
|
10,352
|
|
|
—
|
|
|
18,992
|
|
|||||
Unbilled receivables
|
—
|
|
|
1,565
|
|
|
17,318
|
|
|
—
|
|
|
18,883
|
|
|||||
Inventories
|
—
|
|
|
8,558
|
|
|
6,065
|
|
|
—
|
|
|
14,623
|
|
|||||
Prepaid expenses and other current assets
|
2,378
|
|
|
892
|
|
|
2,596
|
|
|
—
|
|
|
5,866
|
|
|||||
Total current assets
|
20,636
|
|
|
19,655
|
|
|
61,345
|
|
|
—
|
|
|
101,636
|
|
|||||
Property, plant, equipment and seismic rental equipment, net
|
1,259
|
|
|
9,641
|
|
|
47,999
|
|
|
—
|
|
|
58,899
|
|
|||||
Multi-client data library, net
|
—
|
|
|
69,746
|
|
|
27,098
|
|
|
—
|
|
|
96,844
|
|
|||||
Investment in subsidiaries
|
662,848
|
|
|
271,486
|
|
|
—
|
|
|
(934,334
|
)
|
|
—
|
|
|||||
Goodwill
|
—
|
|
|
—
|
|
|
23,354
|
|
|
—
|
|
|
23,354
|
|
|||||
Intangible assets, net
|
—
|
|
|
2,337
|
|
|
49
|
|
|
—
|
|
|
2,386
|
|
|||||
Intercompany receivables
|
—
|
|
|
—
|
|
|
35,433
|
|
|
(35,433
|
)
|
|
—
|
|
|||||
Other assets
|
1,332
|
|
|
145
|
|
|
256
|
|
|
—
|
|
|
1,733
|
|
|||||
Total assets
|
$
|
686,075
|
|
|
$
|
373,010
|
|
|
$
|
195,534
|
|
|
$
|
(969,767
|
)
|
|
$
|
284,852
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current maturities of long-term debt
|
$
|
38,619
|
|
|
$
|
1,364
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
39,983
|
|
Accounts payable
|
2,829
|
|
|
19,026
|
|
|
2,623
|
|
|
—
|
|
|
24,478
|
|
|||||
Accrued expenses
|
10,839
|
|
|
9,919
|
|
|
9,508
|
|
|
—
|
|
|
30,266
|
|
|||||
Accrued multi-client data library royalties
|
—
|
|
|
22,573
|
|
|
78
|
|
|
—
|
|
|
22,651
|
|
|||||
Deferred revenue
|
—
|
|
|
2,684
|
|
|
6,592
|
|
|
—
|
|
|
9,276
|
|
|||||
Total current liabilities
|
52,287
|
|
|
55,566
|
|
|
18,801
|
|
|
—
|
|
|
126,654
|
|
|||||
Long-term debt, net of current maturities
|
116,206
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
116,206
|
|
|||||
Intercompany payables
|
493,667
|
|
|
15,252
|
|
|
—
|
|
|
(508,919
|
)
|
|
—
|
|
|||||
Other long-term liabilities
|
1,716
|
|
|
6,238
|
|
|
10,623
|
|
|
—
|
|
|
18,577
|
|
|||||
Total liabilities
|
663,876
|
|
|
77,056
|
|
|
29,424
|
|
|
(508,919
|
)
|
|
261,437
|
|
|||||
Equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock
|
119
|
|
|
290,460
|
|
|
49,394
|
|
|
(339,854
|
)
|
|
119
|
|
|||||
Additional paid-in capital
|
900,574
|
|
|
180,699
|
|
|
202,290
|
|
|
(382,989
|
)
|
|
900,574
|
|
|||||
Accumulated earnings (deficit)
|
(858,462
|
)
|
|
215,372
|
|
|
12,438
|
|
|
(227,810
|
)
|
|
(858,462
|
)
|
|||||
Accumulated other comprehensive income (loss)
|
(20,032
|
)
|
|
4,372
|
|
|
(20,691
|
)
|
|
16,319
|
|
|
(20,032
|
)
|
|||||
Due from ION Geophysical Corporation
|
—
|
|
|
(394,949
|
)
|
|
(78,537
|
)
|
|
473,486
|
|
|
—
|
|
|||||
Total stockholders’ equity
|
22,199
|
|
|
295,954
|
|
|
164,894
|
|
|
(460,848
|
)
|
|
22,199
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
1,216
|
|
|
—
|
|
|
1,216
|
|
|||||
Total equity
|
22,199
|
|
|
295,954
|
|
|
166,110
|
|
|
(460,848
|
)
|
|
23,415
|
|
|||||
Total liabilities and equity
|
$
|
686,075
|
|
|
$
|
373,010
|
|
|
$
|
195,534
|
|
|
$
|
(969,767
|
)
|
|
$
|
284,852
|
|
|
December 31, 2016
|
||||||||||||||||||
Balance Sheet
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
23,042
|
|
|
$
|
—
|
|
|
$
|
29,610
|
|
|
$
|
—
|
|
|
$
|
52,652
|
|
Accounts receivable, net
|
—
|
|
|
12,775
|
|
|
7,995
|
|
|
—
|
|
|
20,770
|
|
|||||
Unbilled receivables
|
—
|
|
|
5,275
|
|
|
8,140
|
|
|
—
|
|
|
13,415
|
|
|||||
Inventories
|
—
|
|
|
8,610
|
|
|
6,631
|
|
|
—
|
|
|
15,241
|
|
|||||
Prepaid expenses and other current assets
|
3,387
|
|
|
4,624
|
|
|
1,548
|
|
|
—
|
|
|
9,559
|
|
|||||
Total current assets
|
26,429
|
|
|
31,284
|
|
|
53,924
|
|
|
—
|
|
|
111,637
|
|
|||||
Property, plant, equipment and seismic rental equipment, net
|
1,745
|
|
|
12,369
|
|
|
53,374
|
|
|
—
|
|
|
67,488
|
|
|||||
Multi-client data library, net
|
—
|
|
|
97,369
|
|
|
8,566
|
|
|
—
|
|
|
105,935
|
|
|||||
Investment in subsidiaries
|
660,880
|
|
|
257,732
|
|
|
—
|
|
|
(918,612
|
)
|
|
—
|
|
|||||
Goodwill
|
—
|
|
|
—
|
|
|
22,208
|
|
|
—
|
|
|
22,208
|
|
|||||
Intangible assets, net
|
—
|
|
|
3,008
|
|
|
95
|
|
|
—
|
|
|
3,103
|
|
|||||
Intercompany receivables
|
—
|
|
|
—
|
|
|
32,174
|
|
|
(32,174
|
)
|
|
—
|
|
|||||
Other assets
|
2,469
|
|
|
145
|
|
|
231
|
|
|
—
|
|
|
2,845
|
|
|||||
Total assets
|
$
|
691,523
|
|
|
$
|
401,907
|
|
|
$
|
170,572
|
|
|
$
|
(950,786
|
)
|
|
$
|
313,216
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current maturities of long-term debt
|
$
|
11,281
|
|
|
$
|
3,166
|
|
|
$
|
134
|
|
|
$
|
—
|
|
|
$
|
14,581
|
|
Accounts payable
|
2,101
|
|
|
19,720
|
|
|
5,068
|
|
|
—
|
|
|
26,889
|
|
|||||
Accrued expenses
|
8,579
|
|
|
10,016
|
|
|
7,645
|
|
|
—
|
|
|
26,240
|
|
|||||
Accrued multi-client data library royalties
|
—
|
|
|
23,663
|
|
|
—
|
|
|
—
|
|
|
23,663
|
|
|||||
Deferred revenue
|
—
|
|
|
2,667
|
|
|
1,042
|
|
|
—
|
|
|
3,709
|
|
|||||
Total current liabilities
|
21,961
|
|
|
59,232
|
|
|
13,889
|
|
|
—
|
|
|
95,082
|
|
|||||
Long-term debt, net of current maturities
|
143,930
|
|
|
279
|
|
|
—
|
|
|
—
|
|
|
144,209
|
|
|||||
Intercompany payables
|
472,276
|
|
|
10,155
|
|
|
—
|
|
|
(482,431
|
)
|
|
—
|
|
|||||
Other long-term liabilities
|
467
|
|
|
12,117
|
|
|
7,943
|
|
|
—
|
|
|
20,527
|
|
|||||
Total liabilities
|
638,634
|
|
|
81,783
|
|
|
21,832
|
|
|
(482,431
|
)
|
|
259,818
|
|
|||||
Equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock
|
118
|
|
|
290,460
|
|
|
19,138
|
|
|
(309,598
|
)
|
|
118
|
|
|||||
Additional paid-in capital
|
899,198
|
|
|
180,700
|
|
|
232,590
|
|
|
(413,290
|
)
|
|
899,198
|
|
|||||
Accumulated earnings (deficit)
|
(824,679
|
)
|
|
216,730
|
|
|
(3,639
|
)
|
|
(213,091
|
)
|
|
(824,679
|
)
|
|||||
Accumulated other comprehensive income (loss)
|
(21,748
|
)
|
|
4,420
|
|
|
(21,787
|
)
|
|
17,367
|
|
|
(21,748
|
)
|
|||||
Due from ION Geophysical Corporation
|
—
|
|
|
(372,186
|
)
|
|
(78,071
|
)
|
|
450,257
|
|
|
—
|
|
|||||
Total stockholders’ equity
|
52,889
|
|
|
320,124
|
|
|
148,231
|
|
|
(468,355
|
)
|
|
52,889
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
509
|
|
|
—
|
|
|
509
|
|
|||||
Total equity
|
52,889
|
|
|
320,124
|
|
|
148,740
|
|
|
(468,355
|
)
|
|
53,398
|
|
|||||
Total liabilities and equity
|
$
|
691,523
|
|
|
$
|
401,907
|
|
|
$
|
170,572
|
|
|
$
|
(950,786
|
)
|
|
$
|
313,216
|
|
|
Three Months Ended June 30, 2017
|
||||||||||||||||||
Income Statement
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Net revenues
|
$
|
—
|
|
|
$
|
14,945
|
|
|
$
|
31,056
|
|
|
$
|
—
|
|
|
$
|
46,001
|
|
Cost of sales
|
—
|
|
|
18,369
|
|
|
12,014
|
|
|
—
|
|
|
30,383
|
|
|||||
Gross profit (loss)
|
—
|
|
|
(3,424
|
)
|
|
19,042
|
|
|
—
|
|
|
15,618
|
|
|||||
Total operating expenses
|
8,072
|
|
|
6,712
|
|
|
4,406
|
|
|
—
|
|
|
19,190
|
|
|||||
Income (loss) from operations
|
(8,072
|
)
|
|
(10,136
|
)
|
|
14,636
|
|
|
—
|
|
|
(3,572
|
)
|
|||||
Interest expense, net
|
(4,183
|
)
|
|
(69
|
)
|
|
11
|
|
|
—
|
|
|
(4,241
|
)
|
|||||
Intercompany interest, net
|
265
|
|
|
(1,643
|
)
|
|
1,378
|
|
|
—
|
|
|
—
|
|
|||||
Equity in earnings of investments
|
1,910
|
|
|
9,077
|
|
|
—
|
|
|
(10,987
|
)
|
|
—
|
|
|||||
Other income (expense)
|
(328
|
)
|
|
(1
|
)
|
|
521
|
|
|
—
|
|
|
192
|
|
|||||
Net income (loss) before income taxes
|
(10,408
|
)
|
|
(2,772
|
)
|
|
16,546
|
|
|
(10,987
|
)
|
|
(7,621
|
)
|
|||||
Income tax expense (benefit)
|
33
|
|
|
(5,171
|
)
|
|
7,540
|
|
|
—
|
|
|
2,402
|
|
|||||
Net income (loss)
|
(10,441
|
)
|
|
2,399
|
|
|
9,006
|
|
|
(10,987
|
)
|
|
(10,023
|
)
|
|||||
Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(418
|
)
|
|
—
|
|
|
(418
|
)
|
|||||
Net income (loss) attributable to ION
|
$
|
(10,441
|
)
|
|
$
|
2,399
|
|
|
$
|
8,588
|
|
|
(10,987
|
)
|
|
$
|
(10,441
|
)
|
|
Comprehensive net loss
|
$
|
(9,242
|
)
|
|
$
|
2,399
|
|
|
$
|
9,852
|
|
|
$
|
(11,833
|
)
|
|
$
|
(8,824
|
)
|
Comprehensive income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(418
|
)
|
|
—
|
|
|
(418
|
)
|
|||||
Comprehensive net income (loss) attributable to ION
|
$
|
(9,242
|
)
|
|
$
|
2,399
|
|
|
$
|
9,434
|
|
|
$
|
(11,833
|
)
|
|
$
|
(9,242
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2016
|
||||||||||||||||||
Income Statement
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Net revenues
|
$
|
—
|
|
|
$
|
17,590
|
|
|
$
|
18,564
|
|
|
$
|
(2
|
)
|
|
$
|
36,152
|
|
Cost of sales
|
—
|
|
|
22,910
|
|
|
8,391
|
|
|
(2
|
)
|
|
31,299
|
|
|||||
Gross profit (loss)
|
—
|
|
|
(5,320
|
)
|
|
10,173
|
|
|
—
|
|
|
4,853
|
|
|||||
Total operating expenses
|
9,791
|
|
|
6,685
|
|
|
4,965
|
|
|
—
|
|
|
21,441
|
|
|||||
Income (loss) from operations
|
(9,791
|
)
|
|
(12,005
|
)
|
|
5,208
|
|
|
—
|
|
|
(16,588
|
)
|
|||||
Interest expense, net
|
(4,641
|
)
|
|
(77
|
)
|
|
16
|
|
|
—
|
|
|
(4,702
|
)
|
|||||
Intercompany interest, net
|
219
|
|
|
(1,095
|
)
|
|
876
|
|
|
—
|
|
|
—
|
|
|||||
Equity in earnings (losses) of investments
|
(8,976
|
)
|
|
5,932
|
|
|
—
|
|
|
3,044
|
|
|
—
|
|
|||||
Other income (expense)
|
(2,112
|
)
|
|
182
|
|
|
213
|
|
|
—
|
|
|
(1,717
|
)
|
|||||
Net income (loss) before income taxes
|
(25,301
|
)
|
|
(7,063
|
)
|
|
6,313
|
|
|
3,044
|
|
|
(23,007
|
)
|
|||||
Income tax expense
|
41
|
|
|
496
|
|
|
1,719
|
|
|
—
|
|
|
2,256
|
|
|||||
Net income (loss)
|
(25,342
|
)
|
|
(7,559
|
)
|
|
4,594
|
|
|
3,044
|
|
|
(25,263
|
)
|
|||||
Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(79
|
)
|
|
—
|
|
|
(79
|
)
|
|||||
Net income (loss) attributable to ION
|
$
|
(25,342
|
)
|
|
$
|
(7,559
|
)
|
|
$
|
4,515
|
|
|
3,044
|
|
|
$
|
(25,342
|
)
|
|
Comprehensive net income (loss)
|
$
|
(28,057
|
)
|
|
$
|
(7,559
|
)
|
|
$
|
1,800
|
|
|
$
|
5,816
|
|
|
$
|
(28,000
|
)
|
Comprehensive income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(79
|
)
|
|
—
|
|
|
(79
|
)
|
|||||
Comprehensive net income (loss) attributable to ION
|
$
|
(28,057
|
)
|
|
$
|
(7,559
|
)
|
|
$
|
1,721
|
|
|
$
|
5,816
|
|
|
$
|
(28,079
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2017
|
||||||||||||||||||
Income Statement
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Net revenues
|
$
|
—
|
|
|
$
|
27,979
|
|
|
$
|
50,578
|
|
|
$
|
—
|
|
|
$
|
78,557
|
|
Cost of sales
|
—
|
|
|
35,956
|
|
|
20,882
|
|
|
—
|
|
|
56,838
|
|
|||||
Gross profit (loss)
|
—
|
|
|
(7,977
|
)
|
|
29,696
|
|
|
—
|
|
|
21,719
|
|
|||||
Total operating expenses
|
17,412
|
|
|
12,871
|
|
|
8,920
|
|
|
—
|
|
|
39,203
|
|
|||||
Income (loss) from operations
|
(17,412
|
)
|
|
(20,848
|
)
|
|
20,776
|
|
|
—
|
|
|
(17,484
|
)
|
|||||
Interest expense, net
|
(8,643
|
)
|
|
(96
|
)
|
|
34
|
|
|
—
|
|
|
(8,705
|
)
|
|||||
Intercompany interest, net
|
593
|
|
|
(3,140
|
)
|
|
2,547
|
|
|
—
|
|
|
—
|
|
|||||
Equity in earnings of investments
|
(3,134
|
)
|
|
17,853
|
|
|
—
|
|
|
(14,719
|
)
|
|
—
|
|
|||||
Other income (expense)
|
(5,087
|
)
|
|
(340
|
)
|
|
551
|
|
|
—
|
|
|
(4,876
|
)
|
|||||
Net income (loss) before income taxes
|
(33,683
|
)
|
|
(6,571
|
)
|
|
23,908
|
|
|
(14,719
|
)
|
|
(31,065
|
)
|
|||||
Income tax expense (benefit)
|
100
|
|
|
(5,213
|
)
|
|
7,097
|
|
|
—
|
|
|
1,984
|
|
|||||
Net income (loss)
|
(33,783
|
)
|
|
(1,358
|
)
|
|
16,811
|
|
|
(14,719
|
)
|
|
(33,049
|
)
|
|||||
Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(734
|
)
|
|
—
|
|
|
(734
|
)
|
|||||
Net income (loss) attributable to ION
|
$
|
(33,783
|
)
|
|
$
|
(1,358
|
)
|
|
16,077
|
|
|
$
|
(14,719
|
)
|
|
(33,783
|
)
|
||
Comprehensive net income (loss)
|
$
|
(32,067
|
)
|
|
$
|
(1,406
|
)
|
|
$
|
17,906
|
|
|
$
|
(15,766
|
)
|
|
$
|
(31,333
|
)
|
Comprehensive income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(734
|
)
|
|
—
|
|
|
(734
|
)
|
|||||
Comprehensive net income (loss) attributable to ION
|
$
|
(32,067
|
)
|
|
$
|
(1,406
|
)
|
|
$
|
17,172
|
|
|
$
|
(15,766
|
)
|
|
$
|
(32,067
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2016
|
||||||||||||||||||
Income Statement
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Net revenues
|
$
|
—
|
|
|
$
|
28,752
|
|
|
$
|
30,065
|
|
|
$
|
—
|
|
|
$
|
58,817
|
|
Cost of sales
|
—
|
|
|
44,337
|
|
|
18,557
|
|
|
—
|
|
|
62,894
|
|
|||||
Gross profit (loss)
|
—
|
|
|
(15,585
|
)
|
|
11,508
|
|
|
—
|
|
|
(4,077
|
)
|
|||||
Total operating expenses
|
17,202
|
|
|
14,501
|
|
|
10,937
|
|
|
—
|
|
|
42,640
|
|
|||||
Income (loss) from operations
|
(17,202
|
)
|
|
(30,086
|
)
|
|
571
|
|
|
—
|
|
|
(46,717
|
)
|
|||||
Interest expense, net
|
(9,334
|
)
|
|
(147
|
)
|
|
45
|
|
|
—
|
|
|
(9,436
|
)
|
|||||
Intercompany interest, net
|
451
|
|
|
(2,112
|
)
|
|
1,661
|
|
|
—
|
|
|
—
|
|
|||||
Equity in earnings (losses) of investments
|
(32,111
|
)
|
|
4,124
|
|
|
—
|
|
|
27,987
|
|
|
—
|
|
|||||
Other income (expense)
|
(2,086
|
)
|
|
(177
|
)
|
|
666
|
|
|
—
|
|
|
(1,597
|
)
|
|||||
Net income (loss) before income taxes
|
(60,282
|
)
|
|
(28,398
|
)
|
|
2,943
|
|
|
27,987
|
|
|
(57,750
|
)
|
|||||
Income tax expense
|
74
|
|
|
749
|
|
|
1,726
|
|
|
—
|
|
|
2,549
|
|
|||||
Net income (loss)
|
(60,356
|
)
|
|
(29,147
|
)
|
|
1,217
|
|
|
27,987
|
|
|
(60,299
|
)
|
|||||
Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(57
|
)
|
|
—
|
|
|
(57
|
)
|
|||||
Net income (loss) applicable to ION
|
$
|
(60,356
|
)
|
|
(29,147
|
)
|
|
$
|
1,160
|
|
|
$
|
27,987
|
|
|
$
|
(60,356
|
)
|
|
Comprehensive net loss
|
$
|
(64,555
|
)
|
|
$
|
(29,147
|
)
|
|
$
|
(3,039
|
)
|
|
$
|
32,243
|
|
|
$
|
(64,498
|
)
|
Comprehensive income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(57
|
)
|
|
—
|
|
|
(57
|
)
|
|||||
Comprehensive net loss attributable to ION
|
$
|
(64,555
|
)
|
|
$
|
(29,147
|
)
|
|
$
|
(3,096
|
)
|
|
$
|
32,243
|
|
|
$
|
(64,555
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2017
|
||||||||||||||
Statement of Cash Flows
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Total Consolidated
|
||||||||
|
(In thousands)
|
||||||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
||||||||
Net cash provided by (used in) operating activities
|
$
|
(1,731
|
)
|
|
$
|
7,416
|
|
|
$
|
(2,046
|
)
|
|
$
|
3,639
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
||||||||
Cash invested in multi-client data library
|
—
|
|
|
(3,962
|
)
|
|
(4,520
|
)
|
|
(8,482
|
)
|
||||
Purchase of property, plant, equipment and seismic rental equipment
|
(165
|
)
|
|
(669
|
)
|
|
(81
|
)
|
|
(915
|
)
|
||||
Net cash used in investing activities
|
(165
|
)
|
|
(4,631
|
)
|
|
(4,601
|
)
|
|
(9,397
|
)
|
||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
||||||||
Payments on notes payable and long-term debt
|
(1,018
|
)
|
|
(2,081
|
)
|
|
(58
|
)
|
|
(3,157
|
)
|
||||
Intercompany lending
|
(1,574
|
)
|
|
(704
|
)
|
|
2,278
|
|
|
—
|
|
||||
Costs associated with issuance of equity
|
(123
|
)
|
|
—
|
|
|
—
|
|
|
(123
|
)
|
||||
Other financing activities
|
(173
|
)
|
|
—
|
|
|
—
|
|
|
(173
|
)
|
||||
Net cash provided by (used in) financing activities
|
(2,888
|
)
|
|
(2,785
|
)
|
|
2,220
|
|
|
(3,453
|
)
|
||||
Effect of change in foreign currency exchange rates on cash and cash equivalents
|
—
|
|
|
—
|
|
|
(169
|
)
|
|
(169
|
)
|
||||
Net decrease in cash and cash equivalents
|
(4,784
|
)
|
|
—
|
|
|
(4,596
|
)
|
|
(9,380
|
)
|
||||
Cash and cash equivalents at beginning of period
|
23,042
|
|
|
—
|
|
|
29,610
|
|
|
52,652
|
|
||||
Cash and cash equivalents at end of period
|
$
|
18,258
|
|
|
$
|
—
|
|
|
$
|
25,014
|
|
|
$
|
43,272
|
|
|
Six Months Ended June 30, 2016
|
||||||||||||||
Statement of Cash Flows
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Total Consolidated
|
||||||||
|
(In thousands)
|
||||||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
||||||||
Net cash provided by (used in) operating activities
|
$
|
11,112
|
|
|
$
|
7,580
|
|
|
$
|
(31,031
|
)
|
|
$
|
(12,339
|
)
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
||||||||
Investment in multi-client data library
|
—
|
|
|
(8,648
|
)
|
|
—
|
|
|
(8,648
|
)
|
||||
Purchase of property, plant, equipment and seismic rental equipment
|
—
|
|
|
(340
|
)
|
|
—
|
|
|
(340
|
)
|
||||
Net cash used in investing activities
|
—
|
|
|
(8,988
|
)
|
|
—
|
|
|
(8,988
|
)
|
||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
||||||||
Payments under revolving line of credit
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Borrowings under revolving line of credit
|
15,000
|
|
|
—
|
|
|
—
|
|
|
15,000
|
|
||||
Repurchase of common stock
|
(964
|
)
|
|
—
|
|
|
—
|
|
|
(964
|
)
|
||||
Payments on notes payable and long-term debt
|
(433
|
)
|
|
(3,986
|
)
|
|
(367
|
)
|
|
(4,786
|
)
|
||||
Cost associated with issuance of notes
|
(6,174
|
)
|
|
—
|
|
|
—
|
|
|
(6,174
|
)
|
||||
Intercompany lending
|
(11,305
|
)
|
|
5,394
|
|
|
5,911
|
|
|
—
|
|
||||
Payment to repurchase bonds
|
(15,000
|
)
|
|
—
|
|
|
—
|
|
|
(15,000
|
)
|
||||
Other financing activities
|
13
|
|
|
—
|
|
|
—
|
|
|
13
|
|
||||
Net cash provided by (used in) financing activities
|
(18,863
|
)
|
|
1,408
|
|
|
5,544
|
|
|
(11,911
|
)
|
||||
Effect of change in foreign currency exchange rates on cash and cash equivalents
|
—
|
|
|
—
|
|
|
738
|
|
|
738
|
|
||||
Net decrease in cash and cash equivalents
|
(7,751
|
)
|
|
—
|
|
|
(24,749
|
)
|
|
(32,500
|
)
|
||||
Cash and cash equivalents at beginning of period
|
33,734
|
|
|
—
|
|
|
51,199
|
|
|
84,933
|
|
||||
Cash and cash equivalents at end of period
|
$
|
25,983
|
|
|
$
|
—
|
|
|
$
|
26,450
|
|
|
$
|
52,433
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
||||||||
Net revenues:
|
|
|
|
|
|
|
|
|
||||||||
E&P Technology & Services:
|
|
|
|
|
|
|
|
|
||||||||
New Venture
|
$
|
19,986
|
|
|
$
|
4,579
|
|
|
$
|
26,935
|
|
|
$
|
7,885
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
||||||||
Data Library
|
9,710
|
|
|
6,275
|
|
|
20,316
|
|
|
10,547
|
|
|
||||
Total multi-client revenues
|
29,696
|
|
|
10,854
|
|
|
47,251
|
|
|
18,432
|
|
|
||||
Imaging Services
|
4,186
|
|
|
7,764
|
|
|
9,941
|
|
|
13,204
|
|
|
||||
Total
|
33,882
|
|
|
18,618
|
|
|
57,192
|
|
|
31,636
|
|
|
||||
E&P Operations Optimization:
|
|
|
|
|
|
|
|
|
||||||||
Devices
|
7,679
|
|
|
6,626
|
|
|
12,669
|
|
|
11,985
|
|
|
||||
Optimization Software & Services
|
4,440
|
|
|
4,475
|
|
|
8,696
|
|
|
8,763
|
|
|
||||
Total
|
12,119
|
|
|
11,101
|
|
|
21,365
|
|
|
20,748
|
|
|
||||
Ocean Bottom Seismic Services
|
—
|
|
|
6,433
|
|
|
—
|
|
|
6,433
|
|
|
||||
Total
|
$
|
46,001
|
|
|
$
|
36,152
|
|
|
$
|
78,557
|
|
|
$
|
58,817
|
|
|
Gross profit (loss):
|
|
|
|
|
|
|
|
|
||||||||
E&P Technology & Services
|
$
|
11,921
|
|
|
$
|
(3,533
|
)
|
|
$
|
15,931
|
|
|
$
|
(13,306
|
)
|
|
E&P Operations Optimization
|
6,258
|
|
|
5,064
|
|
|
11,045
|
|
|
9,783
|
|
|
||||
Ocean Bottom Seismic Services
|
(2,561
|
)
|
|
3,322
|
|
|
(5,257
|
)
|
|
(554
|
)
|
|
||||
Total
|
$
|
15,618
|
|
|
$
|
4,853
|
|
|
$
|
21,719
|
|
|
$
|
(4,077
|
)
|
|
Gross margin:
|
|
|
|
|
|
|
|
|
||||||||
E&P Technology & Services
|
35
|
%
|
|
(19
|
)%
|
|
28
|
%
|
|
(42
|
)%
|
|
||||
E&P Operations Optimization
|
52
|
%
|
|
46
|
%
|
|
52
|
%
|
|
47
|
%
|
|
||||
Ocean Bottom Seismic Services
|
—
|
%
|
|
52
|
%
|
|
—
|
%
|
|
(9
|
)%
|
|
||||
Total
|
34
|
%
|
|
13
|
%
|
|
28
|
%
|
|
(7
|
)%
|
|
||||
Income (loss) from operations:
|
|
|
|
|
|
|
|
|
||||||||
E&P Technology & Services
|
$
|
6,353
|
|
|
$
|
(9,410
|
)
|
|
$
|
5,257
|
|
|
$
|
(24,124
|
)
|
|
E&P Operations Optimization
|
3,022
|
|
|
1,882
|
|
|
4,571
|
|
|
3,483
|
|
|
||||
Ocean Bottom Seismic Services
|
(3,860
|
)
|
|
360
|
|
|
(7,868
|
)
|
|
(7,271
|
)
|
|
||||
Support and other
|
(9,087
|
)
|
|
(9,420
|
)
|
|
(19,444
|
)
|
|
(18,805
|
)
|
|
||||
Loss from operations
|
$
|
(3,572
|
)
|
|
$
|
(16,588
|
)
|
|
$
|
(17,484
|
)
|
|
$
|
(46,717
|
)
|
|
Operating margin:
|
|
|
|
|
|
|
|
|
||||||||
E&P Technology & Services
|
19
|
%
|
|
(51
|
)%
|
|
9
|
%
|
|
(76
|
)%
|
|
||||
E&P Operations Optimization
|
25
|
%
|
|
17
|
%
|
|
21
|
%
|
|
17
|
%
|
|
||||
Ocean Bottom Seismic Services
|
—
|
%
|
|
6
|
%
|
|
—
|
%
|
|
(113
|
)%
|
|
||||
Support and other
|
(20
|
)%
|
|
(26
|
)%
|
|
(25
|
)%
|
|
(32
|
)%
|
|
||||
Total
|
(8
|
)%
|
|
(46
|
)%
|
|
(22
|
)%
|
|
(79
|
)%
|
|
||||
Net loss attributable to ION
|
$
|
(10,441
|
)
|
|
$
|
(25,342
|
)
|
|
$
|
(33,783
|
)
|
|
$
|
(60,356
|
)
|
|
Net loss per share:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.88
|
)
|
|
$
|
(2.22
|
)
|
|
$
|
(2.85
|
)
|
|
$
|
(5.48
|
)
|
|
Diluted
|
$
|
(0.88
|
)
|
|
$
|
(2.22
|
)
|
|
$
|
(2.85
|
)
|
|
$
|
(5.48
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Special Items
|
—
|
|
|
4,191
|
|
(a)
|
5,000
|
|
(b)
|
4,191
|
|
(a)
|
||||
Net loss attributable to ION as adjusted
|
$
|
(10,441
|
)
|
|
$
|
(21,151
|
)
|
|
$
|
(28,783
|
)
|
|
$
|
(56,165
|
)
|
|
Net loss per share as adjusted:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.88
|
)
|
|
$
|
(1.85
|
)
|
|
$
|
(2.43
|
)
|
|
$
|
(5.10
|
)
|
|
Diluted
|
$
|
(0.88
|
)
|
|
$
|
(1.85
|
)
|
|
$
|
(2.43
|
)
|
|
$
|
(5.10
|
)
|
|
(a)
|
Represents severance charges of $2.0 million and $2.2 million on extinguishment of debt associated with our second quarter 2016 bond exchange.
|
(b)
|
Represents a loss contingency accrual related to legal proceedings. See footnote 6
“Litigation”
of Footnotes to Consolidated Financial Statements.
|
Date
|
|
Percentage
|
2015
|
|
104.063%
|
2016
|
|
102.031%
|
2017 and thereafter
|
|
100.000%
|
Date
|
|
Percentage
|
2019
|
|
105.500%
|
2020
|
|
103.500%
|
2021 and thereafter
|
|
100.000%
|
The following table is a summary of net revenues by geographic area (in thousands):
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
2016
|
||||
Net revenues by geographic area:
|
|
|
|
||||
North America
|
$
|
21,265
|
|
|
$
|
12,272
|
|
Latin America
|
18,757
|
|
|
7,506
|
|
||
Europe
|
17,064
|
|
|
17,092
|
|
||
Asia Pacific
|
11,585
|
|
|
6,172
|
|
||
CIS
|
7,332
|
|
|
1,063
|
|
||
Africa
|
1,473
|
|
|
9,269
|
|
||
Middle East
|
1,081
|
|
|
5,443
|
|
||
Total
|
$
|
78,557
|
|
|
$
|
58,817
|
|
•
|
any additional damages or adverse rulings in the WesternGeco litigation and future potential adverse effects on our liquidity;
|
•
|
future levels of capital expenditures of our customers for seismic activities;
|
•
|
future oil and gas commodity prices;
|
•
|
the effects of current and future worldwide economic conditions (particularly in developing countries) and demand for oil and natural gas and seismic equipment and services;
|
•
|
future cash needs and availability of cash to fund our operations and pay our obligations;
|
•
|
the effects of current and future unrest in the Middle East, North Africa, Korea and other regions;
|
•
|
the timing of anticipated revenues and the recognition of those revenues for financial accounting purposes;
|
•
|
the effects of ongoing and future industry consolidation, including, in particular, the effects of consolidation and vertical integration in the towed marine seismic streamers market;
|
•
|
the timing of future revenue realization of anticipated orders for multi-client survey projects and data processing work in our E&P Technology & Services segment;
|
•
|
future levels of our capital expenditures;
|
•
|
future government regulations pertaining to the oil and gas industry;
|
•
|
expected net revenues, income from operations and net income;
|
•
|
expected gross margins for our services and products;
|
•
|
future benefits to be derived from our OceanGeo subsidiary;
|
•
|
future seismic industry fundamentals, including future demand for seismic services and equipment;
|
•
|
future benefits to our customers to be derived from new services and products;
|
•
|
future benefits to be derived from our investments in technologies, joint ventures and acquired companies;
|
•
|
future growth rates for our services and products;
|
•
|
the degree and rate of future market acceptance of our new services and products;
|
•
|
expectations regarding E&P companies and seismic contractor end-users purchasing our more technologically-advanced services and products;
|
•
|
anticipated timing and success of commercialization and capabilities of services and products under development and start-up costs associated with their development;
|
•
|
future opportunities for new products and projected research and development expenses;
|
•
|
expected continued compliance with our debt financial covenants;
|
•
|
expectations regarding realization of deferred tax assets;
|
•
|
anticipated results with respect to certain estimates we make for financial accounting purposes; and
|
•
|
compliance with the U.S. Foreign Corrupt Practices Act and other applicable U.S. and foreign laws prohibiting corrupt payments to government officials and other third parties.
|
Period
|
|
(a)
Total Number of
Shares Acquired
|
|
(b)
Average Price Paid Per Share |
|
(c)
Total Number of Shares Purchased as Part of Publicly Announced Plans or Program |
|
(d)
Maximum Number (or Approximate Dollar Value) of Shares That May Yet Be Purchased Under the Plans or Program |
|||
April 1, 2017 to April 30, 2017
|
|
—
|
|
|
$
|
—
|
|
|
Not applicable
|
|
Not applicable
|
May 1, 2017 to May 31, 2017
|
|
—
|
|
|
$
|
—
|
|
|
Not applicable
|
|
Not applicable
|
June 1, 2017 to June 30, 2017
|
|
3,904
|
|
|
$
|
4.45
|
|
|
Not applicable
|
|
Not applicable
|
Total
|
|
3,904
|
|
|
$
|
4.45
|
|
|
|
|
|
31.1
|
|
Certification of Chief Executive Officer Pursuant to Rule 13a-14(a).
|
|
|
|
31.2
|
|
Certification of Chief Financial Officer Pursuant to Rule 13a-14(a).
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32.1
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Certification of Chief Executive Officer Pursuant to 18 U.S.C. §1350.
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32.2
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Certification of Chief Financial Officer Pursuant to 18 U.S.C. §1350.
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101
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The following materials are formatted in Extensible Business Reporting Language (XBRL): (i) Condensed Consolidated Balance Sheets as of June 30, 2017 and December 31, 2016, (ii) Condensed Consolidated Statements of Operations for the three- and six-months ended June 30, 2017 and 2016, (iii) Condensed Consolidated Statements of Comprehensive Loss for the three- and six-months ended June 30, 2017 and 2016, (iv) Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2017 and 2016, (v) Footnotes to Unaudited Condensed Consolidated Financial Statements.
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ION GEOPHYSICAL CORPORATION
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By
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/s/ Steven A. Bate
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Steven A. Bate
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Executive Vice President and Chief Financial Officer
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Exhibit No.
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Description
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31.1
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Certification of Chief Executive Officer Pursuant to Rule 13a-14(a).
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31.2
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Certification of Chief Financial Officer Pursuant to Rule 13a-14(a).
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32.1
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Certification of Chief Executive Officer Pursuant to 18 U.S.C. §1350.
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32.2
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Certification of Chief Financial Officer Pursuant to 18 U.S.C. §1350.
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101
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The following materials are formatted in Extensible Business Reporting Language (XBRL): (i) Condensed Consolidated Balance Sheets as of June 30, 2017 and December 31, 2016, (ii) Condensed Consolidated Statements of Operations for the three- and six-months ended June 30, 2017 and 2016, (iii) Condensed Consolidated Statements of Comprehensive Loss for the three- and six-months ended June 30, 2017 and 2016, (iv) Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2017 and 2016, (v) Footnotes to Unaudited Condensed Consolidated Financial Statements.
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