SeaBird Exploration Plc

Fourth quarter report 2014 - Seite 2

In light of the weakness experienced in 3D market demand, the company decided to lay up the Voyager Explorer in November. Furthermore, the company has opted to lay up the Geo Pacific after its Africa survey, which was completed in the early part of Q1 2015. Non-recurring cost of sales resulting from the implementation of the lay-up of Geo Pacific and Voyager Explorer amounted to $9.0 million during the quarter. The cost provision covers estimated net losses until redelivery of Geo Pacific in 2015 and Voyager Explorer in 2016.

Multi-client surveys represented 5% of vessel utilization for Q4 compared to 30% for Q3. Multi-client revenues were $4.6 million during the quarter.

No additional yard stays were performed during the quarter.

The company's health, safety, security, environment and quality (HSSEQ) controls continued to prove effective and resulted in a Lost Time Injury Frequency (LTIF) rate of zero for the quarter.

As a part of the restructuring and refinancing effort, the company incurred $1.7 million in non-recurring advisory costs for the period and $1.1 million in relation to the closure of the Dubai office. In addition, the company made a provision of $8.1 million for bad debt related to certain long-dated receivables. These charges were all reported under selling, general and administrative expenses. Further, the company had a loss on insurance settlements of $1.0 million, which was booked under other income and expenses.

Property, plant and equipment impairments amounted to $24.8 million during the quarter. The impairments relate to vessels and equipment and were triggered by the current market weakness. The recent reduction in oil prices is also expected to delay and reduce revenues from selected multi-client surveys, and triggered an impairment of $5.5 million during the quarter. The company also performed its annual review of goodwill and decided to make a goodwill impairment of $1.3 million.

 

Regional overview

Europe, Africa and the Middle East (EAME) represented the largest portion of revenues during the quarter.

Sales in EAME of $17.4 million accounted for 62% of total revenues. The increase in EAME revenues compared to the prior period was mainly due to higher contract utilization. Munin Explorer worked in the region under its long-term charter agreement. Harrier Explorer completed a multi-client project off the coast of Ireland and also completed a 2D contract survey in the region. Geo Pacific continued to work on its 3D contract in Africa during the quarter.