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CGG : 2015 Third Quarter Results

2015 Third Quarter Results

Positive Free Cash Flow in more challenging market conditions

Next step in our Transformation Plan

Q3: Positive Operating Income1 and Free Cash Flow1

  • Revenue at $470m, stable sequentially
  • Group Operating Income1 at $4m and EBIT1 at $15m
  • Contractual Data Acquisition2: reduced marine losses
  • Equipment: a 5% margin in low volumes
  • GGR: solid operational margin at 21%
  • EBITDAs1 at $122m and Cash Capex down 51% y-o-y, at $98m
  • Net income at $(1,074)m after $(1,015)m impairment and non-recurring charges
  • Q3 Free Cash Flow1 at $22m and Year-To-Date FCF1 at $(61)m
  • Group Liquidity at $440m by September-end
  • September-end Net Debt/EBITDAs ratio at 3.25x and covenant holiday by December-end 2015

Next step: Focus on high added-value businesses
Fleet reduction to 5 operated vessels mainly dedicated to Multi-Client

  • GGR to represent above 60% and Contractual Data Acquisition2 below 15% of future Group revenue
  • Marine fleet to be reduced to 5 vessels by Q2 2016; 2/3 dedicated to multi-client programs. 3 vessels already cold-stacked by October-end
  • Reduction of 930 positions3 worldwide and across the Group
  • $950m non-cash one-off costs booked in Q3 corresponding mainly to goodwill impairment
  • $200m forward cash costs to be booked and to be spent mostly in Q2-Q3 2016
  • Financing of the Group transformation through disposal of non-core assets and equity offering or sale of a minority interest

1Figures before Non-Recurring Charges related to the Transformation Plan
2New reporting scheme (Ref. Appendix)
3 Plan subject to agreement with employee representatives

PARIS, Nov. 5, 2015 (GLOBE NEWSWIRE) -- CGG (ISIN: 0000120164 - NYSE: CGG), world leader in Geoscience, announced today its non-audited 2015 third quarter results.

Commenting on these results, Jean-Georges Malcor, CGG CEO, said:

"In a very challenging market, our good cash performance this quarter is the result of the cost and capex reduction measures taken since the end of 2013 in the context of our Transformation Plan which aims at transforming CGG from a seismic acquisition company into an integrated geoscience company.

Anticipating market conditions that continue to deteriorate in Q4 and that could remain at such levels for longer, we intend to strengthen this strategy which has been implemented over the last two years. This new major step in our transformation will mainly translate into the resizing of our marine fleet to five vessels, two thirds of their capacity being dedicated to multi-client programs. Looking forward, this action will allow our contractual data acquisition activity to represent less than 15% of our consolidated revenue, thereby reducing the Group's exposure to this cyclical, highly competitive and high capital-intensive business. This adjustment of our fleet and the cost-reduction measures will result in the cut of around 13% of job positions worldwide. This new phase in our Transformation Plan is being submitted for the approval of our employee representatives to be implemented during the first half of 2016. It triggers $950 million non-cash costs already booked in our Q3 accounts and around $200 million cash costs to be booked in the future.

We plan to finance the Group needs, notably related to the Transformation Plan, through disposal of non-core assets and equity offering or sale of a minority interest.

This new phase will allow us to build a rebalanced company supported by our unique positions in Equipment, in Multi-Client, in Imaging and Reservoir and by our technology expertise in Data Acquisition. CGG should remain resilient all along the downturn of the cycle to become strongly cash-generative when the market bounces back."

Post-closing event

CGG sold its Canadian onshore Multi-Client Library, on October 31, 2015.

Third quarter 2015 results:

  • Revenue at $470m, stable sequentially
  • Operating income, before Non-Recurring Charges (NRC), at $4m
  • Group EBIT, before NRC, at $15m with positive contribution from Equity Income mainly driven by the SBGS Joint-Venture
  • EBITDA at $122m, and positive Free Cash Flow before NRC at $22m
  • Following the strong deterioration of market conditions and the reduction in CGG's fleet, assets impairment & write-off and Non-Recurring Charges of $1,015m booked in Q3:
    • $500m split between $365m of Marine goodwill impairment and $135m of additional impairments, mainly vessels related
    • $450m write-off mainly related to non-allocated GGR goodwill
    • $48m depreciation of our deferred tax assets on past losses
    • $17m other restructuring costs, mainly related to redundancies
  • Net Income at $(1,074)m after NRC
  • Backlog at $821m as of October1st, 2015. As of today, marine fleet coverage is at 92% in Q4 2015. Indicator no longer relevant in 2016, as the fleet will be mainly dedicated to Multi-Client activity
  • Decision to implement in Q3 a New Segment Reporting
    • New segmentation with no impact at consolidated level
    • Creation of a new segment "Non-Operated Resources" sheltering marine idle assets and Group restructuring costs
    • GGR segment now includes Marine capital employed dedicated to Multi-Client activity
    • Data Acquisition segment now strictly limited to contractual revenues

Third Quarter 2015 Key Figures

Before Non-Recurring Charges (NRC)

In million $ Third Quarter
2014
Second Quarter
2015
Third Quarter
2015
Group Revenue 694 473 470
Equipment 180 107 103
Contractual Data Acquisition 235 130 152
Geology, Geophysics & Reservoir (GGR) 305 257 227
Eliminations (26) (21) (12)
Group EBITDAS 208 112 122
Equipment 42 17 15
Contractual Data Acquisition 26 (24) 11
GGR 176 136 113
Non-Operated Resources 0 0 0
Corporate costs & Eliminations (36) (17) (17)
Group EBITDAS margin 30.0% 23.6% 26.0%
Operating Income 51 (25) 4
Equipment 29 7 5
Contractual Data Acquisition (11) (57) (24)
GGR 71 51 47
Non-Operated Resources (4) (6) (5)
Corporate costs & Eliminations (34) (20) (19)
Group Opinc margin 7.3% (5.2)% 0.9%
Group EBIT 40 (9) 15
Equipment 29 7 5
Contractual Data Acquisition (20) (41) (13)
GGR 69 51 47
Non-Operated Resources (4) (6) (5)
Corporate costs & Eliminations (34) (20) (19)
Group EBIT margin 5.8% (1.9)% 3.2%
Cash Flow from Operations 156 101 145
Net Financial Costs (50) (46) (50)
thereof Cash component (17) (49) (26)
Free Cash Flow (63) (64) 22

Third Quarter 2015 Key Figures

After Non-Recurring Charges (NRC)

In million $ Third Quarter
2014
Second Quarter
2015
Third Quarter
2015
Group EBITDAS 201 106 107
Operating Income (14) (30) (963)
Group EBIT (24) (14) (952)
Net Financial Costs (50) (46) (50)
Total Income Taxes (43) (1) (72)
Including Deferred Tax on Currency Translation (9) 0.5 (1)
Net Income (116) (61) (1,074)
Non-recurring charges (64) (5) (967)
Cash Flow from Operations 136 80 120
Free Cash Flow (83) (85) (3)
Net Debt 2,579 2,497 2,538
Capital Employed 5,983 5,185 4,148

Year-to-Date 2015 Key Figures

Before Non-Recurring Charges (NRC)

In million $ YTD 14 YTD 15
Group Revenue 2,189 1,512
Equipment 583 335
Contractual Data Acquisition 847 501
Geology, Geophysics & Reservoir (GGR) 894 723
Eliminations (135) (47)
Group EBITDAS 591 379
Equipment 143 57
Contractual Data Acquisition 92 5
GGR 486 369
Non-Operated Resources 0 0
Corporate costs & Eliminations (130) (52)
Group EBITDAS margin 27.0% 25.1%
Operating Income 131 (2)
Equipment 109 26
Contractual Data Acquisition (19) (103)
GGR 189 145
Non-Operated Resources (13) (14)
Corporate costs & Eliminations (135) (56)
Group Opinc margin 6.0% (0.1)%
Group EBIT 91 25
Equipment 109 26
Contractual Data Acquisition (56) (76)
GGR 186 145
Non-Operated Resources (13) (14)
Corporate costs & Eliminations (135) (56)
Group EBIT margin 4.2% 1.7%
Cash Flow from Operations 543 362
Net Financial Costs (146) (143)
thereof Cash component (68) (101)
Free Cash Flow (267) (61)

Year-to-Date 2015 Key Figures

After Non-Recurring Charges (NRC)

In million $ YTD 14 YTD 15
Group EBITDAS 487 342
Operating Income (165) (992)
Group EBIT (205) (965)
Net Financial Costs (204) (143)
Total Income Taxes (71) (82)
Including Deferred Tax on Currency Translation (13) (2)
Net Income (480) (1,190)
Non-recurring charges (296) (990)
Cash Flow from Operations 517 290
Free Cash Flow (293) (133)
Net Debt 2,579 2,538
Capital Employed 5,983 4,148

Third Quarter 2015 Financial Results by Operating Segment and before non-recurring charges

Equipment

Equipment Third Quarter
2014
Second Quarter
2015
Third Quarter
2015
Variation
Year-on-year
Variation
Quarter-to-quarter
In million $
Total Revenue 180 107 103 (43)% (4)%
External Revenue 167 97 96 (43%) (1)%
EBITDAs 42 17 15 (63)% (9)%
Margin 23.0% 15.9% 15.0% (800) bps (90)bps
Operating Income 29 7 5 (83)% (27)%
Margin 16.2% 6.3% 4.8% (1,140) bps (150)bps
EBIT 29 7 5 (83)% (27)%
Capital Employed (in billion $) 0.8 0.7 0.7 NA NA

Equipment Total Revenue was $103 million, down 43% compared to the third quarter of 2014 and 4% sequentially. Marine equipment sales were still impacted by low volumes in a weak marine market. Land sales benefited from partial deliveries to our Middle East clients.
Marine equipment sales represented 28% of total sales, compared to 24% in the second quarter of 2015. Internal sales have slightly decreased sequentially, representing only 7% of total sales this quarter compared to 9% in the second quarter of 2015. External sales were $96 million, stable compared to the second quarter of 2015.

Equipment EBITDAs was $15 million, a margin of 15.0%.

Equipment Operating Income was $5 million, a margin of 4.8% thanks to strong and continuing cost reduction measures.

Equipment Capital Employed was $0.7 billion at the end of September 2015.

Contractual Data Acquisition

Contractual Data Acquisition Third Quarter
2014
Second Quarter
2015
Third Quarter
2015
Variation
Year-on-year


Variation
Quarter-to-quarter
In million $
Total Revenue 235 130 152 (35)% 17%
Total Marine Acquisition 175 86 110 (37)% 29%
Total Land and Multi-Physics Acquisition 60 44 42 (30)% (5)%
EBITDAs 26 (24) 11 (60)% 144%
Margin 11.1% (18.3%) 6.9% (420) bps 2,520 bps
Operating Income (11) (57) (24) (111)% 58%
Margin (4.8%) (43.4%) (15.6%) (1,080) bps 2,780 bps
EBIT (20) (41) (13) 35% 68%
Margin (8.5%) (31.6%) (8.5%) 0 bp 2,310 bps
Capital Employed (in billion $) 1.5 1.3 0.8 NA NA

Contractual Data Acquisition Total Revenue was $152 million, down 35% year-on-year and up 17% sequentially.

  • Contractual Marine Acquisition revenue was $110 million, down 37% year-on-year and up 29% sequentially. The vessel availability rate was 84%. This compares to a 74% availability rate in the second quarter of 2015 and a 92% rate in the third quarter of 2014. Our vessel production rate was at 92% compared to a 92% production rate in the third quarter of 2014 and 94% in the second quarter of 2015.
  • Land and Multi-Physics Acquisition revenue was $42 million, down 30% year-on-year and 5% sequentially. The restructuring measures implemented over the last two years led to a positive financial performance of our Land activity.

Contractual Data Acquisition EBITDAs was $11 million, a margin of 6.9%.

Contractual Data Acquisition Operating Income was $(24) million. The higher availability rate and our cost reduction program enabled us to significantly reduce the marine negative contribution this quarter.

Contractual Data Acquisition EBIT was $(13) million. Positive contribution from Investments in Equity can be mainly explained by the positive contributions from the Seabed Geosolutions and Argas JVs.

Contractual Data Acquisition EBIT after NRC includes $(505) million of non-recurring items linked to the Transformation Plan.

Contractual Data Acquisition Capital Employed was $0.8 billion at the end of September 2015.

Geology, Geophysics & Reservoir (GGR)

GGR Third Quarter
2014
Second Quarter
2015
Third Quarter
2015
Variation
Year-on-year
Variation
Quarter-to-quarter
In million $
Total Revenue 305 257 227 (26)% (12)%
Multi-client 133 120 84 (37)% (30)%
Prefunding 104 83 57 (46)% (32)%
Subsurface Imaging & Reservoir 172 137 143 (17)% 4%
EBITDAs 176 136 113 (36)% (17)%
Margin 57.9% 52.8% 49.8% (810) bps (300) bps
Operating Income 71 51 47 (34)% (9)%
Margin 23.2% 19.9% 20.5% (270) bps 60 bps
EBIT 69 51 47 (34)% (10)%
Margin 22.7% 19.9% 20.5% (220) bps 60 bps
Capital Employed (in billion $) 3.8 3.3 2.6 NA NA

GGR Total Revenue was $227 million, down 26% year-on-year and 12% sequentially.

  • Multi-client revenue was $84 million, down 37% year-on-year and 30% sequentially. 33% of the fleet was dedicated to multi-client programs compared to 44% in Q3 2014 and 42% in Q2 2015.
    • Prefunding revenue was $57 million, down 46% year-on-year and 32% sequentially. Multi-client cash capex was at $68 million, down 55% year-on-year and 14% sequentially. The cash prefunding rate was at 83% versus 106% in Q2 2015 and 69% in Q3 2014.
    • After-sales revenue was $27 million, down 5% year-on-year and 25% sequentially.
  • Subsurface Imaging & Reservoir revenue was $143 million, down 17% year-on-year and up 4% sequentially. Some delays in Capex spending were still impacting Subsurface Imaging and Reservoir revenues but Geosoftware benefited from some good Geovation sales.

GGR EBITDAs was $113 million, a 49.8% margin.

GGR Operating Income was $47 million, a 20.5% margin. The multi-client depreciation rate totaled 61%, leading to a library Net Book Value of $1,042 million at the end of September; split 12% onshore and 88% offshore.

GGR EBIT was $47 million, a 20.5% margin.

GGR EBIT after NRC includes $(456) million of non-recurring items linked to the Transformation Plan.

GGR Capital Employed was $2.6 billion at the end of September 2015.

Non-Operated Resources

Non-Operated Resources Third Quarter
2014
Second Quarter
2015
Third Quarter
2015
Variation
Year-on-year


Variation
Quarter-to-quarter
In million $
EBITDAs 0 0 0 NA NA
Operating Income (4) (6) (5) (21)% 27%
EBIT (4) (6) (5) (21)% 27%
Capital Employed (in billion $) (0.1) (0.1) 0.0 NA NA

The Non-Operated Resources Segment comprises the costs of the non-operated Marine assets as well as the transformation costs. The capital employed of this segment includes the non-operated Marine assets and the provisions related to the Group Transformation Plan.

Non-Operated Resources EBITDAs was nil.

Non-Operated Resources Operating Income was $(5) million.

Non-Operated Resources EBIT was $(5) million.

Non-Operated Resources EBIT after NRC includes $(6) million of non-recurring items linked to the Transformation Plan.

Non-Operated Resources Capital Employed was nil at the end of September 2015.

Third Quarter 2015 Financial Results

Group Total Revenue was $470 million, down 32% year-on-year and 1% sequentially. This breaks down to 20% from Equipment, 32% from Contractual Data Acquisition and 48% from GGR.

Third Quarter
2014
Second Quarter
2015
Third Quarter
2015
Variation
Year-on-year
Variation
quarter-to-quarter
In million $
Group Total Revenue 694 473 470 (32)% (1)%
Equipment 180 107 103 (43)% (4)%
Contractual Data Acquisition 235 130 152 (35)% 17%
GGR 305 257 227 (26)% (12)%
Eliminations (26) (21) (12) NA NA

Group EBITDAs was $122 million, a margin of 26.0%. After NRC, Group EBITDAs was $107 million.

Third Quarter
2014
Second Quarter
2015
Third Quarter
2015
Variation
Year-on-year


Variation
Quarter-to-quarter
In million $
Group EBITDAs 208 112 122 (41)% 9%
Margin 30.0% 23.6% 26.0% (400) bps 240 bps
Equipment 42 17 15 (63)% (9)%
Contractual Data Acquisition 26 (24) 11 (60)% 144%
GGR 176 136 113 (36)% (17)%
Non-Operated Resources 0 0 0 NA NA
Eliminations (25) (9) (8) NA NA
Corporate costs (11) (8) (9) NA NA
Non-recurring charges (NRC) (7) (5) (15) NA NA

Group Operating Income was $4 million, a margin of 0.9%. After NRC, Group Operating Income was $(963) million.

Third Quarter
2014
Second Quarter
2015
Third Quarter
2015
Variation
Year-on-year
Variation
Quarter-to-quarter
In million $
Group Operating Income 51 (25) 4 (92)% 118%
Margin 7.3% (5.2)% 0.9% (510) bps 610 bps
Equipment 29 7 5 (83)% (27)%
Contractual Data Acquisition (11) (57) (24) (111)% 58%
GGR 71 51 47 (34)% (9)%
Non-Operated Resources (4) (6) (5) (21)% 27%
Eliminations (22) (13) (9) NA NA
Corporate costs (12) (7) (9) NA NA
Non-recurring charges (NRC) (64) (5) (967) NA NA

Group EBIT was $15 million, a margin of 3.2%. After NRC, Group EBIT was $(952) million.

Total non-recurring charges were $967 million:

  • $500m split between $365m of marine goodwill impairment and $135m of additional impairments, mainly vessels related
  • $450m write-off related to unallocated goodwill within GGR
  • $17m other restructuring costs, mainly related to redundancies.

Net financial costs were $50 million:

  • Cost of debt was $44 million. The total amount of interest paid during the quarter was $26 million
  • Other financial items were a negative contribution of $6 million.

Other Income Taxes totaled $72 million, including $48m depreciation of our French deferred tax assets on past losses.

Group Net Income was $(1,074) million after NRC.

After minority interests, Net Income attributable to the owners of CGG was a loss of $(1,074) million / €(959) million. EPS was negative at $(6.07) / €(5.41).

Cash Flow

Cash Flow from operations was at $145 million compared to $136 million for the third quarter 2014. After NRC, the cash flow from operations was $120 million.

Global Capex was $98 million, down 16% sequentially and 52% year-on-year.

  • Industrial capex was $22 million, down 19% sequentially and 42% year-on-year
  • Research & Development capex was $8 million
  • Multi-client cash capex was $68 million, down 14% sequentially and 55% year-on-year

Third Quarter
2014
Second Quarter
2015
Third Quarter
2015
In million $
Capex 202 117 98
Industrial 39 28 22
R&D 12 10 8
Multi-client Cash 151 79 68
Marine MC 134 74 57
Land MC 18 5 11

Free Cash Flow

After the payment of interest expenses and Capex and before Non-Recurring Charges, free cash flow was positive at $22 million compared to $(63) million for the third quarter 2014. After NRC, Free Cash Flow was negative at $(3) million.

Comparison of Third Quarter 2015 with Third Quarter 2014 and Second Quarter 2015

Consolidated Income Statements Third Quarter
2014
Second Quarter
2015
Third Quarter
2015
In Million $
Euro/dollar exchange rate 1.34 1.10 1.11
Operating Revenue 694 473 470
Equipment 180 107 103
Contractual Data Acquisition 235 130 152
GGR 305 257 227
Eliminations (26) (21) (12)
Gross Margin 123 39 66
Operating Income before NRC 51 (25) 4
Equipment 29 7 5
Contractual Data Acquisition (11) (57 ) (24)
GGR 71 51 47
Non-Operated Resources (4) (6) (5)
Corporate costs & Eliminations (34) (20) (19)
NRC (64) (5) (967)
Operating Income after NRC (14) (30) (963)
Equity from Investments before NRC (10) 15 11
EBIT before NRC 40 (9) 15
EBIT after NRC (24) (14) (952)
Net Financial Costs (50) (46) (50)
Other Income Taxes (33) (1) (72)
Deferred Tax on Currency Translation (9) 0.5 (1)
Net Income (116) (61) (1,074)
Earnings per share in $ (0.67) (0.35) (6.07)
Earnings per share in € (0.50) (0.32) (5.41)
EBITDAs before NRC 208 112 122
Equipment 42 17 15
Contractual Data Acquisition 26 (24) 11
GGR 176 136 113
Non-Operated Resources 0 0 0
Corporate costs & Eliminations (36) (17) (17)
NRC (7) (5) (15)
EBITDAs after NRC 201 106 107
Industrial/ R&D Capex (including change in fixed assets payables) 46 36 27
MC Cash Capex 151 79 68

Year-to-Date 2015 Financial Results

Group Total Revenue was $1.512 billion, down 31% compared to 2014 due to weakening market conditions and perimeter effects. This figure breaks down to 20% from Equipment, 32% from Contractual Data Acquisition and 48% from GGR.

YTD 2014 YTD 2015 Variation
In million $
Group Total Revenue 2,189 1,512 (31)%
Equipment 583 335 (43)%
Contractual Data Acquisition 847 501 (41)%
GGR 894 723 (19)%
Eliminations (135) (47) NA

Group EBITDAs was $379 million, down 36% and representing a 25.1% margin. After NRC, Group EBITDAs was $342 million.

YTD 2014 YTD 2015 Variation
In million $
Group EBITDAs 591 379 (36)%
Margin 27.0% 25.1% (190) bps
Equipment 143 57 (60)%
Contractual Data Acquisition 92 5 (94)%
GGR 486 369 (24)%
Non-Operated Resources 0 0 NA
Eliminations (90) (26) NA
Corporate costs (40) (26) NA
Non-recurring charges (104) (37) NA

Group Operating Income was $(2) million, a margin of (0.1)%. After NRC, Group Operating Income was $(992) million. Market conditions deteriorated over the year with a slowdown in client Capex spending and the postponement of projects.

  • The Operating Income margin for Equipment was at 7.7%. The Equipment segment showed continued resilience to the market downturn and lower volumes thanks to very efficient cost management and manufacturing flexibility.
  • The Operating Income margin for Contractual Data Acquisition was at (20.5)% (excluding NRC), despite a high production rate at 93% and good operational performance. The financial performance of our Contractual Data Acquisition segment was impacted by difficult pricing conditions and a low availability rate in average.
  • The Operating Income margin for GGR was at 20.0% with a solid performance across all the businesses. Multi-Client activity reached $303m with a prefunding rate of 83%. The multi-client depreciation rate totalled 58% leading to a Net Book Value of $1,042 million at the end of September. Subsurface Imaging delivered a good performance notably in North America despite some delays in Clients' Capex spending.

YTD 2014 YTD 2015 Variation
In million $
Group Operating Income 131 (2) (102)%
Margin 6.0% (0.1)% (610) bps
Equipment 109 26 (76)%
Contractual Data Acquisition (19) (103) (447)%
GGR 189 145 (23)%
Non-Operated Resources (13) (14) (9)%
Eliminations (92) (29) NA
Corporate costs (44) (27) NA
Non-recurring charges (296) (990) NA

Group EBIT was $25 million, down 73%, representing a margin of 1.7%. After NRC, Group EBIT was $(965) million.

Total non-recurring charges were $990 million including:

  • $500m split between $365m of marine goodwill impairment and $135m of additional impairments, mainly vessels related
  • $450m write-off related to unallocated goodwill within GGR
  • $40m other restructuring costs, mainly related to redundancies

Net financial costs were $143 million:

  • Cost of debt was $133 million. The total amount of interest paid was $101 million
  • Other financial items showed a loss of $10 million due to the Forex impact

Other Income Taxes were $80 million, mainly due to $48m depreciation of our French deferred tax assets on past losses.

Group Net Income was $(1,190) million after NRC.

After minority interests, Net Income attributable to the owners of CGG was a loss of $(1,191) million / €(1,063) million. EPS was negative at $(6.73) / €(6.00).

Cash Flow

Cash Flow from operations was $362 million before NRC and $290 million after NRC.

Global Capex was $331 million, down 54% year-on-year.

  • Industrial capex was $84 million, down 57% year-on-year
  • Research & Development capex was $29 million
  • Multi-client cash capex was $218 million. down 55% year-on-year

YTD 2014 YTD 2015
In million $
Capex 721 331
Industrial 196 84
R&D 43 29
Multi-client Cash 482 218
Marine MC 437 197
Land MC 45 22

Free Cash Flow

After the payment of interest expenses and Capex and before Non-Recurring Charges, free cash flow was negative at $(61) million compared to $(267) million for the first nine months of 2014. After NRC, Free Cash Flow was negative at $(133) million.

Balance Sheet

Net Debt to Equity Ratio:

Group gross debt was $2.874 billion at the end of September 2015. Available cash was $336 million and Group net debt was $2.538 billion.

Net debt to shareholders equity ratio, at the end of September 2015, was 164% compared to 90%, at the end of December 2014.

The Group's Liquidity, corresponding to the sum of the cash balance and the undrawn portion of the revolving credit facilities, amounted to $440m at the end of September 2015.

September-end Net Debt/EBITDAs ratio was at 3.2x and covenant holiday by December-end 2015 negotiated with our lending banks.

Year-to-Date 2015 Comparisons with Year-to-Date 2014

Consolidated Income Statements YTD 2014 YTD 2015
In Million $
Euro/dollar exchange rate 1.36 1.12
Operating Revenue 2,189 1,512
Equipment 583 335
Contractual Data Acquisition 847 501
GGR 894 723
Eliminations (135) (47)
Gross Margin 389 195
Operating Income before NRC 131 (2)
Equipment 109 26
Contractual Data Acquisition (19) (103)
GGR 189 145
Non-Operated Resources (13) (14)
Corporate costs & Eliminations (135) (56)
NRC (296) (990)
Operating Income after NRC (165) (992)
Equity from Investments before NRC (40) 27
EBIT before NRC 91 25
EBIT after NRC (205) (965)
Net Financial Costs (204) (143)
Other Income Taxes (57) (80)
Deferred Tax on Currency Translation (13) (2)
Net Income (480) (1,190)
Earnings per share in $ (2.74) (6.73)
Earnings per share in € (2.01) (6.00)
EBITDAs before NRC 591 379
Equipment 143 57
Contractual Data Acquisition 92 5
GGR 486 369
Non-Operated Resources 0 0
Corporate costs & Eliminations (130) (52)
NRC (104) (37)
EBITDAs after NRC 487 342
Industrial/ R&D Capex (including change in fixed assets payables) 223 101
MC Cash Capex 482 218

Former reporting format
Q3.14 - Q2 and Q3.15 & Year-To-Date 14-15

Old Reporting - Third Quarter 2015 Key Figures

Before Non-Recurring Charges (NRC)

In million $ Third Quarter 2014 Second Quarter 2015 Third Quarter 2015
Group Revenue 694 473 470
Equipment 180 107 103
Data Acquisition 418 223 225
Geology, Geophysics & Reservoir (GGR) 305 257 227
Eliminations (209) (114) (85)
Group EBITDAS 208 112 122
Equipment 42 17 15
Data Acquisition 72 6 34
GGR 178 138 114
Corp & Eliminations (84) (49) (41)
Group EBITDAS margin 30.0% 23.6% 25.9%
Equipment margin 23.0% 15.9% 15.0%
Data Acquisition margin 17.3% 2.7% 15.3%
GGR margin 58.6% 53.6% 50.5%
Operating Income 51 (25) 4
Equipment 29 7 5
Data Acquisition 0 (55) (22)
GGR 74 53 48
Corp & Eliminations (52) (30) (27)
Group Opinc margin 7.3% (5.2)% 0.9%
Equipment margin 16.2% 6.3% 4.8%
Data Acquisition margin 0.1% (24.6)% (9.9)%
GGR margin 28.1% 20.7% 21.2%
Group EBIT 40 (9) 15
Equipment 29 7 5
Data Acquisition (8) (40) (12)
GGR 73 53 48
Corp & Eliminations (54) (29) (26)
Group EBIT margin 5.8% (1.9)% 3.2%
Equipment margin 16.2% 6.3% 4.8%
Data Acquisition margin (2.0)% (17.7)% (5.1)%
GGR margin 24.0% 20.7% 21.2%

Old Reporting - Year-to-Date 2015 Key Figures

Before Non-Recurring Charges (NRC)

In million $ YTD 2014 YTD 2015
Group Revenue 2,189 1,512
Equipment 583 335
Data Acquisition 1,458 744
Geology, Geophysics & Reservoir (GGR) 894 723
Eliminations (746) (290)
Group EBITDAS 591 379
Equipment 143 57
Data Acquisition 248 84
GGR 498 374
Corp & Eliminations (299) (136)
Group EBITDAS margin 27.0% 25.0%
Equipment margin 24.6% 17.1%
Data Acquisition margin 17.0% 11.3%
GGR margin 55.6% 51.7%
Operating Income 131 (2)
Equipment 109 26
Data Acquisition 8 (96)
GGR 213 150
Corp & Eliminations (199) (82)
Group Opinc margin 6.0% (0.1)%
Equipment margin 18.7% 7.7%
Data Acquisition margin 0.6% (12.9)%
GGR margin 23.8% 20.7%
Group EBIT 91 25
Equipment 109 26
Data Acquisition (17) (69)
GGR 198 150
Corp & Eliminations (199) (82)
Group EBIT margin 4.2% 1.7%
Equipment margin 18.7% 7.7%
Data Acquisition margin (1.1)% (9.3)%
GGR margin 22.1% 20.7%

New reporting format

2014 (Q1, Q2, Q3, Q4 and Full Year)
&
2015 (Q1, Q2, Q3)

New Reporting - 2014 Key Figures

Before Non-Recurring Charges (NRC)

In million $ First Quarter 2014 Second Quarter 2014 Third Quarter 2014 Fourth Quarter 2014 FY 2014
Group Revenue 806 689 694 906 3,095
Equipment 206 196 180 219 802
Contractual Data Acquisition 358 254 235 210 1,057
Geology, Geophysics & Reservoir (GGR) 290 300 305 489 1,384
Eliminations (48) (61) (26) (12) (148)
Group EBITDAS 188 195 208 402 994
Equipment 52 50 42 67 210
Contractual Data Acquisition 28 38 26 3 95
GGR 155 155 176 365 851
Non-Operated Resources 0 0 0 0 0
Corporate costs & Eliminations (46) (48) (36) (32) (162)
Group EBITDAS margin 23.4% 28.3% 30.0% 44.4% 32.1%
Equipment margin 25.0% 25.6% 23.0% 30.4% 26.2%
Contractual Data Acquisition margin 7.7% 15.1% 11.1% 1.4% 9.0%
GGR margin 53.4% 51.5% 57.9% 74.6% 61.5%
Operating Income 35 46 51 111 242
Equipment 41 38 29 55 164
Contractual Data Acquisition (13) 6 (11) (48) (67)
GGR 59 59 71 140 328
Non-Operated Resources (3) (6) (4) (4) (17)
Corporate costs & Eliminations (49) (51) (34) (31) (166)
Group Opinc margin 4.3% 6.7% 7.3% 12.2% 7.8%
Equipment margin 20.0% 19.6% 16.2% 25.3% 20.5%
Contractual Data Acquisition margin (3.7)% 2.3% (4.8)% (23.1)% (6.4)%
GGR margin 20.5% 19.5% 23.2% 28.5% 23.7%
Group EBIT 18 33 40 69 160
Equipment 41 38 29 55 164
Contractual Data Acquisition (30) (6) (20) (88) (144)
GGR 59 58 69 137 323
Non-Operated Resources (3) (6) (4) (4) (17)
Corporate costs & Eliminations (49) (51) (34) (31) (166)
Group EBIT margin 2.2% 4.7% 5.8% 7.6% 5.2%
Equipment margin 20.0% 19.6% 16.2% 25.3% 20.5%
Contractual Data Acquisition margin (8.2)% (2.5)% (8.5)% (41.7)% (13.6)%
GGR margin 20.4% 19.2% 22.7% 28.0% 23.3%

New Reporting - Year-to-Date 2015 Key Figures

Before Non-Recurring Charges (NRC)

In million $ First Quarter 2015 Second Quarter 2015 Third Quarter 2015
Group Revenue 570 473 470
Equipment 125 107 103
Contractual Data Acquisition 219 130 152
Geology, Geophysics & Reservoir (GGR) 239 257 227
Eliminations (13) (21) (12)
Group EBITDAS 145 112 122
Equipment 25 17 15
Contractual Data Acquisition 19 (24) 11
GGR 120 136 113
Non-Operated Resources 0 0 0
Corporate costs & Eliminations (19) (17) (17)
Group EBITDAS margin 25.5% 23.6% 26.0%
Equipment margin 19.8% 15.9% 15.0%
Contractual Data Acquisition margin 8.5% (18.3)% 6.9%
GGR margin 50.3% 52.8% 49.8%
Operating Income 18 (25) 4
Equipment 14 7 5
Contractual Data Acquisition (23) (57) (24)
GGR 47 51 47
Non-Operated Resources (3) (6) (5)
Corporate costs & Eliminations (17) (20) (19)
Group Opinc margin 3.2% (5.2)% 0.9%
Equipment margin 11.3% 6.3% 4.8%
Contractual Data Acquisition margin (10.3)% (24.6)% (15.6)%
GGR margin 19.7% 20.7% 20.5%
Group EBIT 19 (9) 15
Equipment 14 7 5
Contractual Data Acquisition (22) (41) (13)
GGR 47 51 47
Non-Operated Resources (3) (6) (5)
Corporate costs & Eliminations (17) (20) (19)
Group EBIT margin 3.3% (1.9)% 3.2%
Equipment margin 11.3% 6.3% 4.8%
Contractual Data Acquisition margin (9.9)% (17.7)% (8.5)%
GGR margin 19.7% 20.7% 20.5%

Other Information

An English language analysts conference call is scheduled today at 9:00 am (Paris time) - 8:00 am (London time)


To follow this conference, please access the live webcast:

From your computer at:


www.cgg.com



A replay of the conference will be available via webcast on the CGG website at: www.cgg.com.

For analysts. please dial the following numbers 5 to 10 minutes prior to the scheduled start time:

France call-in
UK call-in
Access code
+33(0)1 76 77 22 27
+44(0)20 3427 0503
2054855

About CGG

CGG ( www.cgg.com ) is a fully integrated Geoscience company providing leading geological, geophysical and reservoir capabilities to its broad base of customers primarily from the global oil and gas industry. Through its three complementary business Segments of Equipment, Acquisition and Geology, Geophysics & Reservoir (GGR), CGG brings value across all aspects of natural resource exploration and exploitation.
CGG employs over 7,500 people around the world, all with a Passion for Geoscience and working together to deliver the best solutions to its customers.
CGG is listed on the Euronext Paris SA (ISIN: 0000120164) and the New York Stock Exchange (in the form of American Depositary Shares. NYSE: CGG).

Contacts

Group Communications
Christophe Barnini
Tel: + 33 1 64 47 38 11
E-Mail: : invrelparis@cgg.com

Investor Relations
Catherine Leveau
Tel: +33 1 64 47 34 89
E-mail: : invrelparis@cgg.com

CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2015

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Amounts in millions of U.S.$, unless indicated September 30, 2015
(unaudited)
December 31, 2014
ASSETS
Cash and cash equivalents 335.4 359.1
Trade accounts and notes receivable, net 689.2 942.5
Inventories and work-in-progress, net 364.4 417.3
Income tax assets 115.1 145.9
Other current assets, net 93.8 126.5
Assets held for sale, net 36.5 38.3
Total current assets 1,634.4 2,029.6
Deferred tax assets 55.7 98.2
Investments and other financial assets, net 160.1 141.8
Investments in companies under equity method 166.0 137.7
Property, plant and equipment, net 947.0 1,238.2
Intangible assets, net 1,415.5 1,373.8
Goodwill, net 1,230.9 2,041.7
Total non-current assets 3,975.2 5,031.4
TOTAL ASSETS 5,609.6 7,061.0
LIABILITIES AND EQUITY
Bank overdrafts 0.9 2.9
Current portion of financial debt 84.6 75.7
Trade accounts and notes payable 294.5 444.2
Accrued payroll costs 161.4 222.5
Income taxes liability payable 37.4 72.2
Advance billings to customers 55.4 54.4
Provisions - current portion 92.2 106.0
Other current liabilities 120.5 231.8
Total current liabilities 846.9 1,209.7
Deferred tax liabilities 189.9 153.8
Provisions - non-current portion 168.5 220.3
Non-current portion of financial debt 2,787.6 2,700.3
Other non-current liabilities 20.5 30.7
Total non-current liabilities 3,166.5 3,105.1
Common stock 279,621,151 shares authorized and 177,065,192 shares with a €0.40 nominal value issued and outstanding at September 30, 2015 and 177,065,192 at December 31, 2014 92.8 92.8
Additional paid-in capital 1,409.7 3,180.4
Retained earnings 1,185.5 562.0
Other reserves 120.4 64.7
Treasury shares (20.6) (20.6)
Net income (loss) for the period attributable to owners of CGG SA (1,191.4) (1,154.4)
Cumulative income and expense recognized directly in equity (7.0) (7.6)
Cumulative translation adjustment (37.8) (24.3)
Equity attributable to owners of CGG SA 1,551.6 2,693.0
Non-controlling interests 44.6 53.2
Total equity 1,596.2 2,746.2
TOTAL LIABILITIES AND EQUITY 5,609.6 7,061.0

UNAUDITED INTERIM CONSOLIDATED STATEMENT OF OPERATIONS

Nine months ended September 30,
Amounts in millions of U.S.$, except per share data or unless indicated 2015 2014
Operating revenues 1,511.9 2,189.2
Other income from ordinary activities 1.1 1.2
Total income from ordinary activities 1,513.0 2,190.4
Cost of operations (1,318.1) (1,800.9)
Gross profit 194.9 389.5
Research and development expenses, net (64.4) (77.9)
Marketing and selling expenses (65.0) (86.4)
General and administrative expenses (73.4) (113.9)
Other revenues (expenses), net (984.1) (276.4)
Operating income (992.0) (165.1)
Expenses related to financial debt (134.8) (156.1)
Income provided by cash and cash equivalents 1.4 1.3
Cost of financial debt, net (133.4) (154.8)
Other financial income (loss) (9.5) (49.2)
Income (loss) of consolidated companies before income taxes (1,134.9) (369.1)
Deferred taxes on currency translation (1.8) (13.3)
Other income taxes (80.1) (57.3)
Total income taxes (81.9) (70.6)
Net income (loss) from consolidated companies (1,216.8) (439.7)
Share of income (loss) in companies accounted for under equity method 27.0 (39.9)
Net income (loss) (1,189.8) (479.6)
Attributable to :
Owners of CGG SA $ (1,191.4) (485.0)
Owners of CGG SA (1) (1,062.7) (356.1)
Non-controlling interests $ 1.6 5.4
Weighted average number of shares outstanding 177,065,192 176,958,659
Dilutive potential shares from stock-options (2) (2)
Dilutive potential shares from performance share plans (2) (2)
Dilutive potential shares from convertible bonds (2) (2)
Dilutive weighted average number of shares outstanding adjusted when dilutive 177,065,192 176,958,659
Net income (loss) per share
Basic $ (6.73) (2.74)
Basic (1) (6.00) (2.01)
Diluted $ (6.73) (2.74)
Diluted (1) (6.00) (2.01)

______________

  1. Converted at the average exchange rate of U.S.$1.1211 and U.S.$1.3618 per € for the periods ended September 30, 2015 and 2014, respectively.
  2. As our net result was a loss, stock-options, performance shares plans and convertible bonds had an accretive effect; as a consequence, potential shares linked to those instruments were not taken into account in the dilutive weighted average number of shares, or in the calculation of diluted loss per share.

UNAUDITED INTERIM CONSOLIDATED STATEMENT OF OPERATIONS

Three months ended September 30,
Amounts in millions of U.S.$, except per share data or unless indicated 2015 2014
Operating revenues 469.8 693.9
Other income from ordinary activities 0.3 0.3
Total income from ordinary activities 470.1 694.2
Cost of operations (404.4) (570.7)
Gross profit 65.7 123.5
Research and development expenses, net (16.9) (23.9)
Marketing and selling expenses (19.2) (26.7)
General and administrative expenses (23.4) (34.7)
Other revenues (expenses), net (969.3) (51.9)
Operating income (963.1) (13.7)
Expenses related to financial debt (44.2) (45.2)
Income provided by cash and cash equivalents 0.4 0.4
Cost of financial debt, net (43.8) (44.8)
Other financial income (loss) (5.9) (4.8)
Income (loss) of consolidated companies before income taxes (1,012.8) (63.3)
Deferred taxes on currency translation (0.6) (9.1)
Other income taxes (71.8) (33.4)
Total income taxes (72.4) (42.5)
Net income (loss) from consolidated companies (1,085.2) (105.8)
Share of income (loss) in companies accounted for under equity method 10.8 (10.2)
Net income (loss) (1,074.4) (116.0)
Attributable to :
Owners of CGG SA $ (1,074.4) (118.1)
Owners of CGG SA (1) (958.8) (86.7)
Non-controlling interests $ - 2.1
Weighted average number of shares outstanding 177,065,192 177,065,192
Dilutive potential shares from stock-options (2) (2)
Dilutive potential shares from performance share plans (2) (2)
Dilutive potential shares from convertible bonds (2) (2)
Dilutive weighted average number of shares outstanding adjusted when dilutive 177,065,192 177,065,192
Net income (loss) per share
Basic $ (6.07) (0.67)
Basic (1) (5.41) (0.50)
Diluted $ (6.07) (0.67)
Diluted (1) (5.41) (0.50)

______________

  1. Corresponding to the nine months amount in euros less the half-year amount in euros.
  2. As our net result was a loss, stock-options, performance shares plans and convertible bonds had an accretive effect; as a consequence, potential shares linked to those instruments were not taken into account in the dilutive weighted average number of shares, or in the calculation of diluted loss per share.

UNAUDITED ANALYSIS BY SEGMENT

Nine months ended September 30,
2015 2014 (restated)
In millions of U.S.$, except for assets and capital employed in billions of U.S.$ Contrac
tual Data
Acqui
sition
Non Operated Resources GGR Equip
ment
Elimi
nationsand other
Conso
lidated
Total
Contrac
tual Data
Acqui
sition
Non Operated Resources GGR Equip
ment
Elimi
nations
and other
Conso
lidated
Total
Revenues from unaffiliated customers 483.0 - 723.0 305.9 - 1,511.9 816.2 - 894.4 478.6 - 2,189.2
Inter-segment revenues 18.1 - - 28.9 (47.0) - 30.8 - - 104.4 (135.2) -
Operating revenues 501.1 - 723.0 334.8 (47.0) 1,511.9 847.0 - 894.4 583.0 (135.2) 2,189.2
Depreciation and amortization (excluding multi-client surveys) (613.2) (13.7) (558.4) (31.2) - (1,216.5) (243.9) (12.6) (156.1) (55.1) - (467.7)
Depreciation and amortization of multi-client surveys - - (177.4) - - (177.4) - - (283.5) - - (283.5)
Operating income (607.9) (36.0) (317.8) 25.8 (56.1) (992.0) (164.3) (99.9) 146.9 87.3 (135.1) (165.1)
Share of income in companies accounted for under equity method (1) 27.0 - - - - 27.0 (37.0) - (2.9) - - (39.9)
Earnings before interest and tax (2) (580.9) (36.0) (317.8) 25.8 (56.1) (965.0) (201.3) (99.9) 144.0 87.3 (135.1) (205.0)
Capital expenditures
(excluding multi-client
surveys) (3)
58.2 - 26.3 16.6 11.7 112.8 170.7 - 4.3 47.9 16.3 239.2
Investments in multi-client
surveys, net cash
- - 218.4 - - 218.4 - - 482.1 - - 482.1
Capital employed 0.8 - 2.6 0.7 - 4.1 1.5 (0.1) 3.8 0.8 - 6.0
Total identifiable assets 1.1 0.2 2.9 0.9 - 5.1 1.9 - 4.1 1.0 0.1 7.1

___________________

  1. Share of operating results of companies accounted for under equity method were U.S.$34.1 million and U.S.$(31.9) million for the nine months ended September 30, 2015 and 2014, respectively.
  2. At the Group level, Operating Income and EBIT before costs related to the Transformation Plan amounted to U.S.$(2.0) million and U.S.$25.0 million, respectively, for the nine months ended September 30, 2015, compared to U.S.$131.1 million and U.S.$91.2 million, respectively, for the nine months ended September 30, 2014.

For the nine months ended September 30, 2015, Contractual Data Acquisition EBIT includes:
(i) U.S.$(365.0) million of marine goodwill depreciation;
(ii) U.S.$(110.0) million relating to impairment of marine equipment;
(iii) U.S.$(25.0) million relating to other intangible assets impairment;

For the nine months ended September 30, 2014, Contractual Data Acquisition EBIT included:
(i) U.S.$(107.0) million impairment of our investment in the SBGS JV accounted for under equity method;
(ii) U.S.$(26.2) million related to impairment of marine equipment;
(iii) and a net gain arising from the sale of 2% of Ardiseis FZCO amounting to U.S.$11.1 million.

For the nine months ended September 30, 2015, Non-Operated Resources EBIT included U.S.$(22.3) million related to the Marine Transformation Plan. For the nine months ended September 30, 2014, Non-Operated Resources EBIT included U.S.$(87.3) million related to the Marine Transformation Plan.

For the nine months ended September 30, 2015, GGR EBIT also included:
(i) U.S.$(438.8) related to GGR CGUs goodwill depreciation,
(ii) U.S.$(11.2) impairment of intangibles assets.

For the nine months ended September 30, 2014, GGR EBIT included a U.S.$(36.7) million impairment of 2007-2009 Brazilian multi-client surveys.

For the nine months ended September 30, 2014, Equipment EBIT included a U.S.$(21.7) million impairment of intangible assets.

For the nine months ended September 30, 2015, "eliminations and other" includes U.S.$(27.0) million of general corporate expenses and U.S.$(29.1) million of intra-group margin. For the nine months ended September 30, 2014, "eliminations and other" included U.S.$(43.5) million of general corporate expenses and U.S.$(91.6) million of intra-group margin.

(3) Capital expenditures include capitalized development costs of U.S.$(29.1) million and U.S.$(43.0) million for the nine months ended September 30, 2015 and 2014, respectively. "Eliminations and other" corresponds to the variance of suppliers of assets for the period.

Three months ended September 30,
2015 2014 (restated)
In millions of U.S.$, except for assets and capital employed in billions of U.S.$ Contrac
tual Data
Acqu
isition
Non Operated Resources GGR Equip
ment
Elimi
nations

and other
Conso
lidated Total
Contrac
tual Data
Acqui
sition
Non Operated Resources GGR Equi
pment
Elimi
nations

and other
Conso
lidated Total
Revenues from unaffiliated customers 147.7 - 226.6 95.5 - 469.8 222.3 - 304.7 166.9 - 693.9
Inter-segment revenues 4.5 - - 7.3 (11.8) - 12.9 - - 13.5 (26.4) -
Operating revenues 152.2 - 226.6 102.8 (11.8) 469.8 235.2 - 304.7 180.4 (26.4) 693.9
Depreciation and amortization
(excluding multi-client surveys)
(537.3) (4.6) (483.7) (10.4) - (1,036.0) (90.5) (3.8) (50.1) (11.9) - (156.3)
Depreciation and amortization of multi-client surveys - - (51.2) - - (51.2) - - (88.9) - - (88.9)
Operating income (529.1) (10.3) (409.9) 4.9 (18.7) (963.1) (70.3) (8.2) 69.7 29.3 (34.2) (13.7)
Share of income in companies accounted for under equity method (1) 10.8 - - - - 10.8 (8.7) - (1.5) - - (10.2)
Earnings before interest and tax (2) (518.3) (10.3) (409.9) 4.9 (18.7) (952.3) (79.0) (8.2) 68.2 29.3 (34.2) (23.9)
Capital expenditures
(excluding multi-client
surveys) (3)
14.5 - 7.5 4.6 3.6 30.2 26.8 - 9.7 9.8 4.5 50.8
Investments in multi-client
surveys, net cash
- - 68.0 - - 68.0 - - 151.1 - - 151.1

  1. Share of operating results of companies accounted for under equity method were U.S.$11.8 million and U.S.$(5.7) million for the three months ended September 30, 2015 and 2014, respectively.
  2. At the Group level, Operating Income and EBIT before costs related to the Transformation Plan amounted to U.S.$4.3 million and U.S.$15.1 million, respectively, for the three months ended September 30, 2015, compared to U.S.$50.7 million and U.S.$40.5 million, respectively, for the three months ended September 30, 2014.

For the three months ended September 30, 2015, Contractual Data Acquisition EBIT includes:
(i) U.S.$(365.0) million of marine goodwill depreciation;
(ii) U.S.$(110.0) million relating to impairment of marine equipment;
(iii) U.S.$(25.0) million relating to other intangible assets impairment;

For the three months ended September 30, 2014, Contractual Data Acquisition EBIT included U.S.$(55.0) million impairment of our investment in the SBGS JV (Seabed Geosolutions BV) accounted for under equity method;

For the three months ended September 30, 2015, Non-Operated Resources EBIT included U.S.$(5.7) million related to the Marine Transformation Plan. For the three months ended September 30, 2014, Non-Operated Resources EBIT included U.S.$(4.4) million related to the Marine Transformation Plan.

For the three months ended September 30, 2015, GGR EBIT also included
(i) U.S.$(438.8) related to GGR CGUs goodwill depreciation,
(ii) U.S.$(11.2) impairment of intangibles assets.

For the three months ended September 30, 2015, "eliminations and other" includes U.S.$(9.4) million of general corporate expenses and U.S.$(9.3) million of intra-group margin. For the three months ended September 30, 2014, "eliminations and other" included U.S.$(12.4) million of general corporate expenses and U.S.$(21.8) million of intra-group margin.

(3) Capital expenditures include capitalized development costs of U.S.$(7.6) million and U.S.$(12.0) million for the three months ended September 30, 2015 and 2014, respectively. "Eliminations and other" corresponds to the variance of suppliers of assets for the period.

UNAUDITED INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS

Nine months ended September 30,
Amounts in millions of U.S.$ 2015 2014
OPERATING
Net income (loss) (1,189.8) (479.6)
Depreciation and amortization 1,216.5 467.7
Multi-client surveys depreciation and amortization 177.4 283.5
Depreciation and amortization capitalized to multi-client surveys (61.7) (106.0)
Variance on provisions (55.5) 56.8
Stock based compensation expenses 1.5 6.4
Net gain (loss) on disposal of fixed assets (0.8) (5.2)
Equity income (loss) of investees (27.0) 39.9
Dividends received from affiliates 5.1 30.7
Other non-cash items (7.3) 46.7
Net cash including net cost of financial debt and income tax 58.4 340.9
Add back net cost of financial debt 133.4 154.8
Add back income tax expense 81.9 70.6
Net cash excluding net cost of financial debt and income tax 273.7 566.3
Income tax paid (17.7) (32.9)
Net cash before changes in working capital 256.0 533.4
- change in trade accounts and notes receivable 171.0 105.7
- change in inventories and work-in-progress 27.8 39.6
- change in other current assets 47.0 (3.8)
- change in trade accounts and notes payable (137.3) (86.0)
- change in other current liabilities (86.5) (84.2)
Impact of changes in exchange rate on financial items 12.0 12.1
Net cash provided by operating activities 290.0 516.8
INVESTING
Capital expenditures (including variation of fixed assets suppliers, excluding multi-client surveys) (112.8) (239.2)
Investment in multi-client surveys, net cash (218.4) (482.1)
Proceeds from disposals of tangible and intangible assets 9.7 4.3
Total net proceeds from financial assets 4.4 1.2
Acquisition of investments, net of cash and cash equivalents acquired (19.3) (8.1)
Impact of changes in consolidation scope - -
Variation in loans granted (21.6) (4.0)
Variation in subsidies for capital expenditures (0.6) -
Variation in other non-current financial assets 3.1 (1.8)
Net cash used in investing activities (355.5) (729.7)
FINANCING
Repayment of long-term debts (222.1) (1,148.7)
Total issuance of long-term debts 396.3 1,251.8
Lease repayments (6.1) (6.6)
Change in short-term loans (1.9) (2.3)
Financial expenses paid (101.4) (89.1)
Net proceeds from capital increase
- from shareholders - 0.1
- from non-controlling interests of integrated companies - -
Dividends paid and share capital reimbursements
- to shareholders - -
- to non-controlling interests of integrated companies (7.5) (35.5)
Acquisition/disposal from treasury shares - -
Net cash provided by (used in) financing activities 57.3 (30.3)
Effects of exchange rates on cash (15.5) (4.8)
Impact of changes in consolidation scope - (30.0)
Net increase (decrease) in cash and cash equivalents (23.7) (278.0)
Cash and cash equivalents at beginning of year 359.1 530.0

Press Release - pdf version http://hugin.info/142000/R/1964272/716937.pdf

HUG#1964272

Source: CGG