Oslo-listed seismic player Polarcus has recorded a net loss second quarter in a row as the contract revenues went down 35% and the company suffered a USD 28.8 million impairment charge.
The Norwegian company recorded a net loss of $73.1 million in Q4 2014, versus a net profit of $ 7.4 million in Q4 2013. Furthermore, net profit for the full 2014 was a negative $71.9 million, compared to a net profit of $43.5 million in 2013.
Earlier in the Q3, the company recorded a net loss of USD 8.9 million in Q3 2014 compared to a net profit of USD 19.9 million in Q3 2013.
Polarcus generated revenues of $93.3 million, down from $123.3 million the same quarter the previous year. Full year 2014 revenues also dropped to $466.7 million from $532.2 million in 2013.
EBITDA for the year decreased by 26% to USD 156.7 million compared to USD 211.9 million in 2013. EBITDA margin decreased to 33% in 2014 compared to 40% in 2013.
In addition to $28.8 million impairment charge, the financial costs were negatively affected by the depreciation of the Russian Ruble and the Norwegian Krone, resulting in higher than expected foreign exchange losses.
Polarcus said that the recent downturn in the seismic market has negatively impacted the company, leading to a more uncertain outlook and therefore, the company won’t be providing guidance for 2015 yet.
Commenting on the results, Rod Starr , CEO Polarcus, said: “The last quarter has seen our clients exercise extreme caution on exploration spend as the oil price declined at its fastest rate since the 2008 cycle. This in turn led to increased competition for contract work as clients delayed project decisions, resulting in idle time and extended transits as we repositioned the fleet to markets where activity was being sustained. Recognizing the importance of a robust multi-client projects pipeline, we have strengthened our multi-client team, taken impairments on two legacy projects in our existing library, and raised the prefunding hurdle rate to ensure that only the highest funded projects make the grade. Against this challenging market backdrop we are accelerating the previously announced initiatives to regionalize sales resources and implement a rigorous cost management program with a clear focus on capital discipline. We are adapting quickly to this new landscape and working to position ourselves for the next phase of growth.”