Seabed seismic player Magseis Fairfield has returned to profit in Q3 2020 despite major revenue drop against the prior-year quarter.
The Oslo-listed company generated Q3 2020 revenue of $47 million, down from $134 million same time last year.
Revenue was up from Q2 2020 revenue of $45 million.
The year-on-year decline reflects that the company had significant revenue from node sales in the third quarter 2019.
The company also said that adverse impacts from Covid-19 and lower oil price in 2020 contributed to revenue drop.
Third-quarter EBITDA came at $10.4 million, against EBITDA of $16.1 million in Q3 2019. Year-to-date EBITDA came at $26.2 million, versus $59.2 million in 2019.
The company booked quarterly profit of $3 million, versus loss of $104 million in the prior-year quarter.
Magseis Fairfield order backlog stood at $170 million at the end Q3 2020, of which $50 million stands for delivery in 2020.
This compares to backlog of $151 million at the end of second quarter of this year.
The market outlook for the OBN market shows a small increase from 2020 to 2021 but the activity will still be below the 2019 levels. The OBN market is expected to see good growth beyond 2021 on the back of forecasted growth in offshore exploration spend in greenfield and brownfield projects, the company said in its quarterly report.
Cost-cutting measures
In April 2020, Magseis Fairfield announced measures as a response to the new market environment, resulting in further capex cuts.
Group cost of sales amounted to $30.7 million in Q3 2020, against $106.7 million in Q3 2019.
The year-on-year improved gross margin reflects better project margins as a result of better operational cost control and improved operational execution.
Total assets for the Group was $333 million at the end of the third quarter 2020, versus $356.5 million at the end of 2019.