EMGS: vessel update and activity for the fourth quarter 2018
Electromagnetic Geoservices ASA (the "Company" or "EMGS") releases information on vessel activity and utilisation 4-5 working days after the close of each quarter. The Company defines vessel utilisation as the percentage of the vessel charter period spent on proprietary or multi-client data acquisition. Downtime (technical or maritime), mobilisation, steaming, and some standby activities are not included in the utilisation rate.
Vessel utilisation for the fourth quarter 2018 was 32% compared with 13% for the fourth quarter in 2017. For the full year 2018, the vessel utilisation was 33%, whereas the utilisation for the full year 2017 was 56%.
In the fourth quarter of 2018, the Company's vessels were allocated 32% to proprietary work and no time was spent on multi-client projects. In the comparable quarter of 2017, the vessels were allocated 13% to multi-client projects and no time was spent on proprietary work.
EMGS had two vessels in operation and recorded 5.7 vessel months in the quarter. In the fourth quarter 2017, the Company recorded 6.0 vessel months.
The Atlantic Guardian began the fourth quarter acquiring data ona small research survey west of Svalbard. On 21 October, the vessel started mobilising to South America and was prepared for the USD 8 million contract, which the vessel started operation on from 20 November. This survey is expected to be completed in Q1 2019.
The vessel's utilisation for the fourth quarter was 49%.
The BOA Thalassa has had a yard stay and been idle this quarter.
Multi-client revenues in the fourth quarter
The new revenue recognition standard, IFRS 15, was effective from 1 January 2018. The multi-client prefunding revenues are recognised at the point in time final data is delivered to the customer, and not based on the so-called Percentage of Completion (POC) principle.
The Company expects to record approximately USD 6 million in multi-client revenues for the fourth quarter 2018.
If the Company had used the same revenue recognition principles as in 2017 (i.e. the POC principle), the multi-client revenues for the fourth quarter 2018 would have totaled approximately USD 4 million.
The difference in revenues are timing differences only and do not have an effect on cashflow.
EMGS will publish its fourth quarter 2018 financial results on Wednesday 30 January 2019 at 07:30 CET. A presentation will be broadcasted live over the Internet, starting at 10:00 CET. To access the presentation, please go to the Company's homepage (www.emgs.com) and follow the link.