Delaware
(State or other jurisdiction of incorporation)
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1-12691
(Commission file number)
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22-2286646
(I.R.S. Employer Identification No.)
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Title of each class
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Trading symbol(s)
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Name of each exchange on which registered
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Common Stock, $0.01 par value
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IO
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New York Stock Exchange
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Exhibit Number
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Description
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23.1
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99.1
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101
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The following materials are formatted in Extensible Business Reporting Language (XBRL): (i) Consolidated Balance Sheets at December 31, 2018 and 2017, (ii) Consolidated Statements of Operations for the years ended December 31, 2018, 2017 and 2016, (iii) Comprehensive Loss for the years ended December 31, 2018, 2017 and 2016, (iv) Consolidated Statements of Cash Flows for the years ended December 31, 2018, 2017 and 2016, (v) Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2018, 2017 and 2016 and (vi) Footnotes to Consolidated Financial Statements.
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ION GEOPHYSICAL CORPORATION
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By:
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/s/ Matthew Powers
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Matthew Powers
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Executive Vice President, General Counsel and Corporate Secretary
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1.
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Registration Statement (Form S-8 No. 333-60950) pertaining to the Input/Output, Inc. Non‑Employee Directors’ Retainer Plan,
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2.
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Registration Statement (Form S-8 No. 333-112677) pertaining to the Input/Output, Inc. 2003 Employee Stock Option Plan,
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3.
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Registration Statement (Form S-8 No. 333-125655) pertaining to the Input/Output, Inc. 2004 Long‑Term Incentive Plan,
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4.
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Registration Statement (Form S-8 No. 333-135775) pertaining to the Input/Output, Inc. Second Amended and Restated Input/Output, Inc. 2004 Long-Term Incentive Plan,
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5.
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Registration Statement (Form S-3 No. 333-112263) of Input/Output, Inc.,
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6.
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Registration Statement (Form S-3 No. 333-123632) of Input/Output, Inc.,
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7.
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Registration Statement (Form S-8 No. 333-145274) pertaining to the Third Amended and Restated Input/Output, Inc. 2004 Long-Term Incentive Plan,
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8.
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Registration Statement (Form S-8 No. 333-155378) pertaining to the Fourth Amended and Restated 2004 Long-Term Incentive Plan and the ARAM Systems Employee Inducement Stock Options Program,
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9.
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Registration Statement (Form S-3 No. 333-159898) of ION Geophysical Corporation,
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10.
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Registration Statement (Form S-8 No. 333-167943) pertaining to the Fifth Amended and Restated 2004 Long-Term Incentive Plan and the ION Geophysical Corporation Employee Stock Purchase Plan,
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11.
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Registration Statement (Form S-3 No. 333-166200) of ION Geophysical Corporation,
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12.
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Registration Statement (Form S-8 No. 333-176046) pertaining to the Sixth Amended and Restated 2004 Long-Term Incentive Plan,
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13.
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Registration Statement (Form S-8 No. 333-190474) pertaining to the 2013 Long-Term Incentive Plan,
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14.
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Registration Statement (Form S-4 No. 333-194110) of ION Geophysical Corporation,
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15.
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15. Registration Statement (Form S-8 No. 333-209707) pertaining to the 2013 Long-Term Incentive Plan,
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16.
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Registration Statement (Form S-3 No. 333-213769) of ION Geophysical Corporation,
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17.
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Registration Statement (Form S-3 No. 333-223053) of ION Geophysical Corporation, and
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18.
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Registration Statement (Form S-8 No. 333-229311) pertaining to the Third Amended and Restated 2013 Long-Term Incentive Plan.
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•
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Leverage our technologies to create value through data capture, analysis and optimization to enhance companies’ critical decision-making abilities and returns. Advances in technology are creating opportunities to analyze vast amounts of data to make better decisions. As a result, decision-making is shifting from what was historically an art to a science. Data, analytics and digitalization provide a step-change opportunity to translate information into insights to enhance decisions, gain a competitive edge and deliver superior returns. ION offerings are focused on improving E&P decision-making and optimizing offshore operations. E&P Technology & Services creates digital data assets and delivers services that improve decision-making, mitigate risk and maximize portfolio value for E&P companies, such as our multi-client programs that are licensed to multiple E&P companies to optimize their investment decisions. Operations Optimization develops mission-critical subscription offerings and engineering services that enable operational control and optimization offshore. This information enables any company operating offshore to enhance their operational decision-making and improve their returns.
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Expand and grow our E&P Technology & Services business, focusing on client value. We seek to expand and grow our E&P Technology & Services business into new regions, with new customers and new offerings, including data processing services through our Imaging Services group and our Ventures multi-client and proprietary programs. Over the last 5 years, we have made an effort to diversify our offerings within the E&P life cycle and move closer to the reservoir. Historically known for our 2-D programs, we entered the 3-D multi-client market in 2014 by acquiring and processing our first survey offshore Ireland. Since then, we have expanded our 3-D seismic data library considerably by purchasing existing seismic data and reimaging the data using our advanced data processing techniques and algorithms, such as our new FWI. For the foreseeable future, we expect to continue investing in research and development and computing infrastructure for our data processing business and to support our multi-client projects. We believe this focusing on valuable E&P offerings will position our company better for higher returns with an increasing proportion of revenues derived from E&P customers. In 2018, E&P companies accounted for approximately 77% of our total consolidated net revenues. We formed an E&P Advisors group in 2015 designed to focus specifically on this element of our strategy.
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Continue investing in advanced software and equipment technology to provide next generation services and products. We intend to continue investing in the development of new technologies for use by E&P companies and service providers. In particular, we intend to focus on the development of our 4Sea next generation OBS technology, our Marlin operations optimization software, and continued advancement of our data processing and imaging workflows, such as FWI, with the goal of obtaining technical and market leadership in what we continue to believe are important and expanding markets. In 2018, our total investment in research and development and engineering was equal to approximately 10% of our total consolidated net revenues for the year.
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Collaborate with our customers to provide products and solutions designed to meet their needs. A key element of our business strategy has been to understand the challenges faced by E&P companies in seismic survey planning, data acquisition, processing, and interpretation. We will continue to develop and offer technology and services that enable us to work with E&P companies to solve their unique challenges around the world. We have found collaborating with E&P companies to better understand their imaging challenges and working with them to ensure the right technologies are properly applied, is the most effective method for meeting their needs. Helping solve the most difficult challenges for our customers is an important element of our long-term business strategy, and we are implementing this partnership approach globally through local personnel in our regional organizations who understand the unique challenges in their areas. We formed an E&P Advisors group in 2015 designed to focus specifically on this element of our strategy.
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Expand our Operations Optimization business into relevant adjacent markets. While our traditional focus for technology has been on the E&P industry, we are broadening and diversifying our software and equipment businesses into relevant adjacent markets such as offshore logistics, defense and marine robotics. Adjacent markets broaden our opportunity to better monetize our return on technology investments while reducing our susceptibility to E&P cycles. We intend to derive a significant portion of revenues from these non-E&P markets over the next 5 years.
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We develop and leverage cutting-edge technology platforms to improve decision-making and profitability. Our cutting-edge data management and analysis platforms help derive insights from data we acquire to improve E&P decision-making, enhance reservoir management and optimize offshore operations. The data can be used to decide whether and how much to bid on a block, how to maximize production from a field, or how to optimize the safety and efficiency of complex maritime projects. Our operations optimization platform and imaging engine are the core underlying technology and we continually advance our complex algorithms to improve the resulting analysis.
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We focus on higher potential return offerings and creative business models to maximize shareholder value. We streamlined our business and focused on the areas with the highest potential returns because we believe every dollar invested should go further. In addition, we try to structure both the project financing and payment in a way to maximize profit, such as sharing in the success of a project.
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Our “asset light” strategy enables us to avoid significant fixed costs and remain financially flexible. We do not own a fleet of marine vessels and do not provide our own crews to acquire seismic data. We outsource seismic data acquisition activity to third parties that operate fleets of seismic vessels and equipment. This practice enables us to avoid fixed costs associated with these assets and personnel and to manage our business in a manner designed to afford us the flexibility to quickly scale up or down our capital investments based on E&P spending levels. We actively manage the costs of developing our multi-client data library business by having our customers partially pre-fund, or underwrite, the investment for any new project. Our target goal is to have a vast majority of the total cost of each new project’s data acquisition to be underwritten by our customers. We believe this conservative approach to data library investment is the most prudent way to reduce the impact of any sudden reduction in the demand for seismic data, giving us the flexibility to aggressively reduce cash outflows as we have successfully implemented in the current industry downturn.
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Our global footprint and diversified portfolio approach enable us to offset regional downturns or local slowdowns. Conducting business around the world has been and will continue to be a key component of our strategy. This global focus and diversified portfolio approach has been helpful in minimizing the impact of any regional or country-specific slowdown for short or extended periods of time. While the traditional focus of our cutting-edge technology has been on the E&P industry, we are now broadening and diversifying our business into relevant adjacent markets such as offshore logistics, defense and marine robotics. Adjacent markets broaden our opportunity to better monetize our return on technology investments while reducing our susceptibility to E&P cycles.
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We have a diversified and blue chip customer base. We provide services and products to a diverse, global customer base that includes many of the largest oil and gas and geophysical companies in the world, including National Oil Companies (“NOCs”) and International Oil Companies (“IOCs”). Over the past decade, we have made significant progress expanding our customers list and revenue sources. Whereas almost all of our revenues in the early 2000s were derived principally from seismic service providers, in 2018, E&P companies accounted for approximately 77% of our total consolidated net revenues.
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any additional damages or adverse rulings in the WesternGeco litigation and future potential adverse effects on our financial results and liquidity;
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future levels of capital expenditures of our customers for seismic activities;
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future oil and gas commodity prices;
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the effects of current and future worldwide economic conditions (particularly in developing countries) and demand for oil and natural gas and seismic equipment and services;
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future cash needs and availability of cash to fund our operations and pay our obligations;
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the effects of current and future unrest in the Middle East, North Africa and other regions;
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the timing of anticipated revenues and the recognition of those revenues for financial accounting purposes;
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the effects of ongoing and future industry consolidation, including, in particular, the effects of consolidation and vertical integration in the towed marine seismic streamers market;
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the timing of future revenue realization of anticipated orders for multi-client survey projects and data processing work in our E&P Technology & Services segment;
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future levels of our capital expenditures;
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future government laws or regulations pertaining to the oil and gas industry, including trade restrictions, embargoes and sanctions imposed by the U.S. government;
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future government actions that may result in the deprivation of our contractual rights, including the potential for adverse decisions by judicial or administrative bodies in foreign countries with unpredictable or corrupt judicial systems.
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expected net revenues, income from operations and net income;
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expected gross margins for our services and products;
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future seismic industry fundamentals, including future demand for seismic services and equipment;
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future benefits to our customers to be derived from new services and products;
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future benefits to be derived from our investments in technologies, joint ventures and acquired companies;
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future growth rates for our services and products;
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the degree and rate of future market acceptance of our new services and products;
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expectations regarding E&P companies and seismic contractor end-users purchasing our more technologically-advanced services and products;
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anticipated timing and success of commercialization and capabilities of services and products under development and start-up costs associated with their development;
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future opportunities for new products and projected research and development expenses;
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expected continued compliance with our debt financial covenants;
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expectations regarding realization of deferred tax assets;
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expectations regarding the impact of the U.S. Tax Cuts and Jobs Act;
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anticipated results with respect to certain estimates we make for financial accounting purposes; and
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compliance with the U.S. Foreign Corrupt Practices Act and other applicable U.S. and foreign laws prohibiting corrupt payments to government officials and other third parties.
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the supply of and demand for oil and gas;
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the level of prices, and expectations about future prices, of oil and gas;
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the cost of exploring for, developing, producing and delivering oil and gas;
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the expected rates of decline for current production;
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the discovery rates of new oil and gas reserves;
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weather conditions, including hurricanes, that can affect oil and gas operations over a wide area, as well as less severe inclement weather that can preclude or delay seismic data acquisition;
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domestic and worldwide economic conditions;
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changes in government leadership, such as the change in presidency in Mexico and its impact on the Mexican economy and offshore exploration programs;
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political instability in oil and gas producing countries;
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technical advances affecting energy consumption;
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government policies regarding the exploration, production and development of oil and gas reserves;
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the ability of oil and gas producers to raise equity capital and debt financing;
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merger and divestiture activity among oil and gas companies and seismic contractors; and
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compliance by members of the OPEC and non-OPEC members such as Russia, with agreements to cut oil production.
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we may have difficulty satisfying our obligations with respect to our outstanding debt;
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we may have difficulty obtaining financing in the future for working capital, capital expenditures, acquisitions or other purposes;
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we may need to use all, or a substantial portion, of our available cash flow to pay interest and principal on our debt, which will reduce the amount of money available to finance our operations and other business activities;
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our vulnerability to general economic downturns and adverse industry conditions could increase;
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our flexibility in planning for, or reacting to, changes in our business and in our industry in general could be limited;
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our amount of debt and the amount we must pay to service our debt obligations could place us at a competitive disadvantage compared to our competitors that have less debt;
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our customers may react adversely to our significant debt level and seek or develop alternative licensors or suppliers;
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we may have insufficient funds, and our debt level may also restrict us from raising the funds necessary to repurchase all of the Notes, as defined below, tendered to us upon the occurrence of a change of control, which would constitute an event of default under the Notes; and
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our failure to comply with the restrictive covenants in our debt instruments which, among other things, limit our ability to incur debt and sell assets, could result in an event of default that, if not cured or waived, could have a material adverse effect on our business or prospects.
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incur additional indebtedness;
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create liens;
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pay dividends and make other distributions in respect of our capital stock;
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redeem our capital stock;
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make investments or certain other restricted payments;
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sell certain kinds of assets;
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enter into transactions with affiliates; and
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effect mergers or consolidations.
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limit our ability to plan for or react to market or economic conditions or meet capital needs or otherwise restrict our activities or business plans; and
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adversely affect our ability to finance our operations, acquisitions, investments or strategic alliances or other capital needs or to engage in other business activities that would be in our interest.
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future competition from more established companies entering the market;
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technology obsolescence;
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dependence upon continued growth of the market for seismic data processing;
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the rate of change in the markets for these segments’ technology and services;
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further consolidation of the participants within this market;
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research and development efforts not proving sufficient to keep up with changing market demands;
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dependence on third-party software for inclusion in these segments’ services and products;
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misappropriation of these segments’ technology by other companies;
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alleged or actual infringement of intellectual property rights that could result in substantial additional costs;
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difficulties inherent in forecasting sales for newly developed technologies or advancements in technologies;
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recruiting, training and retaining technically skilled, experienced personnel that could increase the costs for these segments, or limit their growth; and
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the ability to maintain traditional margins for certain of their technology or services.
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We may not fully recover our costs of acquiring and processing seismic data through future sales. The ultimate amounts involved in these data sales are uncertain and depend on a variety of factors, many of which are beyond our control.
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The timing of these sales is unpredictable and can vary greatly from period to period. The costs of each survey are capitalized and then amortized as a percentage of sales and/or on a straight-line basis over the expected useful life of the data. This amortization will affect our earnings and, when combined with the sporadic nature of sales, will result in increased earnings volatility.
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Regulatory changes that affect companies’ ability to drill, either generally or in a specific location where we have acquired seismic data, could materially adversely affect the value of the seismic data contained in our library. Technology changes could also make existing data sets obsolete. Additionally, each of our individual surveys has a limited book life based on its location and oil and gas companies’ interest in prospecting for reserves in such location, so a particular survey may be subject to a significant decline in value beyond our initial estimates.
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The value of our multi-client data could be significantly adversely affected if any material adverse change occurs in the general prospects for oil and gas exploration, development and production activities.
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The cost estimates upon which we base our pre-commitments of funding could be wrong. The result could be losses that have a material adverse effect on our financial condition and results of operations. These pre-commitments of funding are subject to the creditworthiness of our clients. In the event that a client refuses or is unable to pay its commitment, we could incur a substantial loss on that project.
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As part of our asset-light strategy, we routinely charter vessels from third-party vendors to acquire seismic data for our multi-client business. As a result, our cost to acquire our multi-client data could significantly increase if vessel charter prices rise materially.
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disruption of E&P activities;
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restriction on the movement and exchange of funds;
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inhibition of our ability to collect advances and receivables;
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enactment of additional or stricter U.S. government or international sanctions;
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limitation of our access to markets for periods of time;
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expropriation and nationalization of assets of our company or those of our customers;
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political and economic instability, which may include armed conflict and civil disturbance;
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currency fluctuations, devaluations and conversion restrictions;
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confiscatory taxation or other adverse tax policies; and
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governmental actions that may result in the deprivation of our contractual rights, including the potential for adverse decisions by judicial or administrative bodies in foreign countries with unpredictable or corrupt judicial systems.
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operating results that vary from the expectations of securities analysts and investors;
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•
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factors influencing the levels of global oil and natural gas exploration and exploitation activities, such as the decline in crude oil prices and depressed prices for natural gas in North America or disasters such as the Deepwater Horizon incident in the Gulf of Mexico in 2010;
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the operating and securities price performance of companies that investors or analysts consider comparable to us;
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actions by rating agencies related to the Notes;
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announcements of strategic developments, acquisitions and other material events by us or our competitors; and
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changes in global financial markets and global economies and general market conditions, such as interest rates, commodity and equity prices and the value of financial assets.
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authorizing the issuance of “blank check” preferred stock without any need for action by stockholders;
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providing for a classified board of directors with staggered terms;
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requiring supermajority stockholder voting to effect certain amendments to our certificate of incorporation and bylaws;
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eliminating the ability of stockholders to call special meetings of stockholders;
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prohibiting stockholder action by written consent; and
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establishing advance notice requirements for nominations for election to the board of directors or for proposing matters that can be acted on by stockholders at stockholder meetings.
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Years Ended December 31,
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2018
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2017
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2016
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(In thousands)
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||||||||||
Net revenues:
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||||||
E&P Technology & Services:
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||||||
New Venture
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$
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69,685
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$
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100,824
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$
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27,362
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Data Library
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47,095
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40,016
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39,989
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Total multi-client revenues
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116,780
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140,840
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67,351
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Imaging Services
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19,740
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16,409
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|
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25,538
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|
|||
Total
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$
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136,520
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|
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$
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157,249
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|
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$
|
92,889
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Operations Optimization:
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|
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||||||
Devices
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$
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22,396
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|
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$
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23,610
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|
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$
|
26,746
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|
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Optimization Software & Services
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21,129
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|
|
16,695
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|
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16,756
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|
|
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Total
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$
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43,525
|
|
|
$
|
40,305
|
|
|
$
|
43,502
|
|
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Other
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$
|
—
|
|
|
$
|
—
|
|
|
$
|
36,417
|
|
(a)
|
Total
|
$
|
180,045
|
|
|
$
|
197,554
|
|
|
$
|
172,808
|
|
|
|
Year Ended December 31, 2018
|
|
Year Ended December 31, 2017
|
|
Year Ended December 31, 2016
|
||||||||||||||||||||||||||||||
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As Reported
|
|
Special Items
|
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As Adjusted
|
|
As Reported
|
|
Special Items
|
|
As Adjusted
|
|
As Reported
|
|
Special Items
|
|
As Adjusted
|
||||||||||||||||||
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(In thousands, except per share data)
|
||||||||||||||||||||||||||||||||||
Gross profit:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
E&P Technology & Services
|
$
|
43,369
|
|
|
$
|
—
|
|
|
$
|
43,369
|
|
|
$
|
65,196
|
|
|
$
|
—
|
|
|
$
|
65,196
|
|
|
$
|
4,708
|
|
|
$
|
766
|
|
|
$
|
5,474
|
|
Operations Optimization
|
22,293
|
|
|
—
|
|
|
22,293
|
|
|
20,076
|
|
|
—
|
|
|
20,076
|
|
|
21,745
|
|
|
188
|
|
|
21,933
|
|
|||||||||
Segment gross profit
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65,662
|
|
|
—
|
|
|
65,662
|
|
|
85,272
|
|
|
—
|
|
|
85,272
|
|
|
26,453
|
|
|
954
|
|
|
27,407
|
|
|||||||||
Other (a)
|
(6,042
|
)
|
|
—
|
|
|
(6,042
|
)
|
|
(9,633
|
)
|
|
—
|
|
|
(9,633
|
)
|
|
9,579
|
|
|
123
|
|
|
9,702
|
|
|||||||||
Total
|
$
|
59,620
|
|
|
$
|
—
|
|
|
$
|
59,620
|
|
|
$
|
75,639
|
|
|
$
|
—
|
|
|
$
|
75,639
|
|
|
$
|
36,032
|
|
|
$
|
1,077
|
|
(f)
|
$
|
37,109
|
|
Gross margin:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
E&P Technology & Services
|
32
|
%
|
|
—
|
%
|
|
32
|
%
|
|
41
|
%
|
|
—
|
%
|
|
41
|
%
|
|
5
|
%
|
|
1
|
%
|
|
6
|
%
|
|||||||||
Operations Optimization
|
51
|
%
|
|
—
|
%
|
|
51
|
%
|
|
50
|
%
|
|
—
|
%
|
|
50
|
%
|
|
50
|
%
|
|
—
|
%
|
|
50
|
%
|
|||||||||
Segment gross margin
|
36
|
%
|
|
—
|
%
|
|
36
|
%
|
|
43
|
%
|
|
—
|
%
|
|
43
|
%
|
|
15
|
%
|
|
—
|
%
|
|
16
|
%
|
|||||||||
Other
|
(3
|
)%
|
|
—
|
%
|
|
(3
|
)%
|
|
(5
|
)%
|
|
—
|
%
|
|
(5
|
)%
|
|
6
|
%
|
|
—
|
%
|
|
6
|
%
|
|||||||||
Total
|
33
|
%
|
|
—
|
%
|
|
33
|
%
|
|
38
|
%
|
|
—
|
%
|
|
38
|
%
|
|
21
|
%
|
|
—
|
%
|
|
21
|
%
|
|||||||||
Income (loss) from operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
E&P Technology & Services
|
$
|
21,758
|
|
|
$
|
—
|
|
|
$
|
21,758
|
|
|
$
|
42,505
|
|
|
$
|
—
|
|
|
$
|
42,505
|
|
|
$
|
(16,446
|
)
|
|
$
|
1,128
|
|
|
$
|
(15,318
|
)
|
Operations Optimization
|
7,295
|
|
|
—
|
|
|
7,295
|
|
|
8,022
|
|
|
—
|
|
|
8,022
|
|
|
9,652
|
|
|
197
|
|
|
9,849
|
|
|||||||||
Support and other (c)
|
(83,325
|
)
|
|
38,658
|
|
(b)
|
(44,667
|
)
|
|
(59,226
|
)
|
|
6,141
|
|
(d)
|
(53,085
|
)
|
|
(36,377
|
)
|
|
684
|
|
|
(35,693
|
)
|
|||||||||
Total
|
$
|
(54,272
|
)
|
|
$
|
38,658
|
|
|
$
|
(15,614
|
)
|
|
$
|
(8,699
|
)
|
|
$
|
6,141
|
|
|
$
|
(2,558
|
)
|
|
$
|
(43,171
|
)
|
|
$
|
2,009
|
|
(f)
|
$
|
(41,162
|
)
|
Operating margin:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
E&P Technology & Services
|
16
|
%
|
|
—
|
%
|
|
16
|
%
|
|
27
|
%
|
|
—
|
%
|
|
27
|
%
|
|
(18
|
)%
|
|
2
|
%
|
|
(16
|
)%
|
|||||||||
Operations Optimization
|
17
|
%
|
|
—
|
%
|
|
17
|
%
|
|
20
|
%
|
|
—
|
%
|
|
20
|
%
|
|
22
|
%
|
|
1
|
%
|
|
23
|
%
|
|||||||||
Support and other
|
(46
|
)%
|
|
21
|
%
|
|
(25
|
)%
|
|
(30
|
)%
|
|
3
|
%
|
|
(27
|
)%
|
|
(21
|
)%
|
|
—
|
%
|
|
(21
|
)%
|
|||||||||
Total
|
(30
|
)%
|
|
21
|
%
|
|
(9
|
)%
|
|
(4
|
)%
|
|
3
|
%
|
|
(1
|
)%
|
|
(25
|
)%
|
|
1
|
%
|
|
(24
|
)%
|
|||||||||
Net income (loss) applicable to common shares
|
$
|
(71,171
|
)
|
|
$
|
38,658
|
|
|
$
|
(32,513
|
)
|
|
$
|
(30,242
|
)
|
|
$
|
11,141
|
|
(e)
|
$
|
(19,101
|
)
|
|
$
|
(65,148
|
)
|
|
$
|
(960
|
)
|
(g)
|
$
|
(66,108
|
)
|
Diluted net income (loss) per common share
|
$
|
(5.20
|
)
|
|
$
|
2.83
|
|
|
$
|
(2.37
|
)
|
|
$
|
(2.55
|
)
|
|
$
|
0.94
|
|
|
$
|
(1.61
|
)
|
|
$
|
(5.71
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(5.80
|
)
|
(a)
|
Relates to the gross profit (loss) of previously reported Ocean Bottom Integrated Technologies segment.
|
|||
|
|
|||
(b)
|
Represents a write-down of the cable-based ocean bottom acquisition technologies of $36.6 million and accelerated vesting and cash exercise of stock appreciation right awards of $2.1 million.
|
|||
|
|
|
|
|
(c)
|
Includes loss from operations, as adjusted, of previously reported Ocean Bottom Integrated Technologies segment of $11.1 million, $16.3 million and $1.3 million for the years ended December 31, 2018, 2017 and 2016, respectively, which includes item (a) above and operating expenses of $5.1 million, $6.7 million and $10.9 million for the years ended December 31, 2018, 2017 and 2016.
|
|||
|
|
|
|
|
(d)
|
Represents accelerated vesting and cash exercise of stock appreciation right awards.
|
|||
|
|
|
|
|
(e)
|
In addition to item (d), also impacting net loss applicable to common shares was a loss contingency accrual of $5.0 million related to legal proceedings.
|
|||
|
|
|
|
|
(f)
|
Represents severance and facility charges related to the Company’s 2016 restructuring.
|
|||
|
|
|
|
|
(g)
|
Represents a $3.9 million recovery of INOVA bad debts, partially offset by item (f).
|
|||
|
|
|
|
|
|
Year Ended December 31, 2018
|
|
Year Ended December 31, 2017
|
||||||||||||||||||||
|
As Reported
|
|
Special Items
|
|
As Adjusted
|
|
As Reported
|
|
Special Items
|
|
As Adjusted
|
||||||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Research, development and engineering
|
$
|
18,182
|
|
|
$
|
—
|
|
|
$
|
18,182
|
|
|
$
|
16,431
|
|
|
$
|
—
|
|
|
$
|
16,431
|
|
Marketing and sales
|
21,793
|
|
|
—
|
|
|
21,793
|
|
|
20,778
|
|
|
—
|
|
|
20,778
|
|
||||||
General, administrative and other operating expenses
|
37,364
|
|
|
(2,105
|
)
|
(a)
|
35,259
|
|
|
47,129
|
|
|
(6,141
|
)
|
(a)
|
40,988
|
|
||||||
Impairment of long-lived assets
|
36,553
|
|
|
(36,553
|
)
|
(b)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total operating expenses
|
$
|
113,892
|
|
|
$
|
(38,658
|
)
|
|
$
|
75,234
|
|
|
$
|
84,338
|
|
|
$
|
(6,141
|
)
|
|
$
|
78,197
|
|
(a)
|
Represents accelerated vesting and cash exercise of stock appreciation rights awards.
|
(b)
|
Represents a write-down of the cable-based ocean bottom acquisition technologies.
|
|
Years Ended December 31,
|
||||||
|
2018
|
|
2017
|
||||
Accrual for contingency related to legal proceedings (Footnote 8)
|
$
|
—
|
|
|
$
|
(5,000
|
)
|
Recovery of INOVA bad debts
|
—
|
|
|
844
|
|
||
Other income (expense)
|
(436
|
)
|
|
211
|
|
||
Total other income (expense)
|
$
|
(436
|
)
|
|
$
|
(3,945
|
)
|
|
Year Ended December 31, 2017
|
|
Year Ended December 31, 2016
|
||||||||||||||||||||
|
As Reported
|
|
Special Items(b)
|
|
As Adjusted
|
|
As Reported
|
|
Special Items(a)
|
|
As Adjusted
|
||||||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Research, development and engineering
|
$
|
16,431
|
|
|
$
|
—
|
|
|
$
|
16,431
|
|
|
$
|
17,833
|
|
|
$
|
(397
|
)
|
|
$
|
17,436
|
|
Marketing and sales
|
20,778
|
|
|
—
|
|
|
20,778
|
|
|
17,371
|
|
|
(262
|
)
|
|
17,109
|
|
||||||
General, administrative and other operating expenses
|
47,129
|
|
|
(6,141
|
)
|
|
40,988
|
|
|
43,999
|
|
|
(273
|
)
|
|
43,726
|
|
||||||
Total operating expenses
|
$
|
84,338
|
|
|
$
|
(6,141
|
)
|
|
$
|
78,197
|
|
|
$
|
79,203
|
|
|
$
|
(932
|
)
|
|
$
|
78,271
|
|
Income (loss) from operations
|
$
|
(8,699
|
)
|
|
$
|
6,141
|
|
|
$
|
(2,558
|
)
|
|
$
|
(43,171
|
)
|
|
$
|
2,009
|
|
|
$
|
(41,162
|
)
|
(a)
|
Includes severance affecting operating expenses.
|
(b)
|
Represents accelerated vesting and cash exercise of stock appreciation rights awards.
|
|
Years Ended December 31,
|
||||||
|
2017
|
|
2016
|
||||
Reduction of (accrual for) loss contingency related to legal proceedings (Footnote 8)
|
$
|
(5,000
|
)
|
|
$
|
1,168
|
|
Recovery of INOVA bad debts
|
844
|
|
|
3,983
|
|
||
Loss on bond exchange
|
—
|
|
|
(2,182
|
)
|
||
Other expense
|
211
|
|
|
(1,619
|
)
|
||
Total other income
|
$
|
(3,945
|
)
|
|
$
|
1,350
|
|
•
|
extend the maturity date of the Credit Facility by approximately four years (from August 22, 2019 to August 16, 2023), subject to the retirement or extension of the maturity date of the Second Lien Notes, as defined below, which mature on December 15, 2021;
|
•
|
increase the maximum revolver amount by $10 million (from $40 million to $50 million);
|
•
|
increase the borrowing base percentage of the net orderly liquidation value as it relates to the multi-client data library (not to exceed $28.5 million, up from the previous maximum of $15 million for the multi-client data library component);
|
•
|
include the eligible billed receivables of the Mexican Subsidiary up to a maximum of $5 million in the borrowing base calculation and joins the Mexican Subsidiary as a borrower thereunder (with a maximum exposure of $5 million) and require the equity and assets of the Mexican Subsidiary to be pledged to secure obligations under the Credit Facility;
|
•
|
modify the interest rate such that the maximum interest rate remains consistent with the fixed interest rate prior to the Third Amendment (that is, 3.00% per annum for domestic rate loans and 4.00% per annum for LIBOR rate loans), but now lowers the range down to a minimum interest rate of 2.00% for domestic rate loans and 3.00% for LIBOR rate loans based on a leverage ratio for the preceding four-quarter period;
|
•
|
decrease the minimum excess borrowing availability threshold which (if the Borrowers have minimum excess borrowing availability below any such threshold) triggers the agent’s right to exercise dominion over cash and deposit accounts; and
|
•
|
modify the trigger required to test for compliance with the fixed charge coverage ratio.
|
Date
|
|
Percentage
|
2019
|
|
105.500%
|
2020
|
|
103.500%
|
2021 and thereafter
|
|
100.000%
|
Contractual Obligations
|
Total
|
|
Less Than 1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
More Than 5 Years
|
||||||||||
Long-term and short-term debt
|
$
|
121,728
|
|
|
$
|
1,159
|
|
|
$
|
120,569
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest on long-term debt obligations
|
34,901
|
|
|
11,344
|
|
|
23,236
|
|
|
321
|
|
|
—
|
|
|||||
Equipment capital lease obligations
|
2,938
|
|
|
1,069
|
|
|
1,869
|
|
|
—
|
|
|
—
|
|
|||||
Operating leases
|
68,938
|
|
|
13,248
|
|
|
34,753
|
|
|
13,914
|
|
|
7,023
|
|
|||||
Purchase obligations
|
2,908
|
|
|
2,908
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
231,413
|
|
|
$
|
29,728
|
|
|
$
|
180,427
|
|
|
$
|
14,235
|
|
|
$
|
7,023
|
|
|
|
|
|
|
Page
|
ION Geophysical Corporation and Subsidiaries:
|
|
|
Report of Independent Registered Public Accounting Firms
|
|
F-2
|
Consolidated Balance Sheets — December 31, 2018 and 2017
|
|
F-3
|
Consolidated Statements of Operations — Years ended December 31, 2018, 2017 and 2016
|
|
F-4
|
Consolidated Statements of Comprehensive Loss — Years ended December 31, 2018, 2017 and 2016
|
|
F-5
|
Consolidated Statements of Cash Flows — Years ended December 31, 2018, 2017 and 2016
|
|
F-6
|
Consolidated Statements of Stockholders’ Equity — Years ended December 31, 2018, 2017 and 2016
|
|
F-8
|
Footnotes to Consolidated Financial Statements
|
|
F-9
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In thousands, except share data)
|
||||||
ASSETS
|
|||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
33,551
|
|
|
$
|
52,056
|
|
Accounts receivable, net
|
26,128
|
|
|
19,478
|
|
||
Unbilled receivables
|
44,032
|
|
|
37,304
|
|
||
Inventories, net
|
14,130
|
|
|
14,508
|
|
||
Prepaid expenses and other current assets
|
7,782
|
|
|
7,643
|
|
||
Total current assets
|
125,623
|
|
|
130,989
|
|
||
Deferred income tax asset, net
|
7,191
|
|
|
1,753
|
|
||
Property, plant, equipment and seismic rental equipment, net
|
13,041
|
|
|
52,153
|
|
||
Multi-client data library, net
|
73,544
|
|
|
89,300
|
|
||
Goodwill
|
22,915
|
|
|
24,089
|
|
||
Other assets
|
2,435
|
|
|
2,785
|
|
||
Total assets
|
$
|
244,749
|
|
|
$
|
301,069
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|||||||
Current liabilities:
|
|
|
|
||||
Current maturities of long-term debt
|
$
|
2,228
|
|
|
$
|
40,024
|
|
Accounts payable
|
34,913
|
|
|
24,951
|
|
||
Accrued expenses
|
31,411
|
|
|
38,697
|
|
||
Accrued multi-client data library royalties
|
29,256
|
|
|
27,035
|
|
||
Deferred revenue
|
7,710
|
|
|
8,910
|
|
||
Total current liabilities
|
105,518
|
|
|
139,617
|
|
||
Long-term debt, net of current maturities
|
119,513
|
|
|
116,720
|
|
||
Other long-term liabilities
|
11,894
|
|
|
13,926
|
|
||
Total liabilities
|
236,925
|
|
|
270,263
|
|
||
Equity:
|
|
|
|
||||
Common stock, $0.01 par value; authorized 26,666,667 shares; outstanding 14,015,615 and 12,019,701 shares at December 31, 2018 and 2017, respectively.
|
140
|
|
|
120
|
|
||
Additional paid-in capital
|
952,626
|
|
|
903,247
|
|
||
Accumulated deficit
|
(926,092
|
)
|
|
(854,921
|
)
|
||
Accumulated other comprehensive loss
|
(20,442
|
)
|
|
(18,879
|
)
|
||
Total stockholders’ equity
|
6,232
|
|
|
29,567
|
|
||
Noncontrolling interests
|
1,592
|
|
|
1,239
|
|
||
Total equity
|
7,824
|
|
|
30,806
|
|
||
Total liabilities and equity
|
$
|
244,749
|
|
|
$
|
301,069
|
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands, except per share data)
|
||||||||||
Service revenues
|
$
|
139,038
|
|
|
$
|
159,410
|
|
|
$
|
130,640
|
|
Product revenues
|
41,007
|
|
|
38,144
|
|
|
42,168
|
|
|||
Total net revenues
|
180,045
|
|
|
197,554
|
|
|
172,808
|
|
|||
Cost of services
|
100,557
|
|
|
103,124
|
|
|
115,763
|
|
|||
Cost of products
|
19,868
|
|
|
18,791
|
|
|
21,013
|
|
|||
Gross profit
|
59,620
|
|
|
75,639
|
|
|
36,032
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Research, development and engineering
|
18,182
|
|
|
16,431
|
|
|
17,833
|
|
|||
Marketing and sales
|
21,793
|
|
|
20,778
|
|
|
17,371
|
|
|||
General, administrative and other operating expenses
|
37,364
|
|
|
47,129
|
|
|
43,999
|
|
|||
Impairment of long-lived assets
|
36,553
|
|
|
—
|
|
|
—
|
|
|||
Total operating expenses
|
113,892
|
|
|
84,338
|
|
|
79,203
|
|
|||
Loss from operations
|
(54,272
|
)
|
|
(8,699
|
)
|
|
(43,171
|
)
|
|||
Interest expense, net
|
(12,972
|
)
|
|
(16,709
|
)
|
|
(18,485
|
)
|
|||
Other income (expense), net
|
(436
|
)
|
|
(3,945
|
)
|
|
1,350
|
|
|||
Loss before income taxes
|
(67,680
|
)
|
|
(29,353
|
)
|
|
(60,306
|
)
|
|||
Income tax expense
|
2,718
|
|
|
24
|
|
|
4,421
|
|
|||
Net loss
|
(70,398
|
)
|
|
(29,377
|
)
|
|
(64,727
|
)
|
|||
Net income attributable to noncontrolling interests
|
(773
|
)
|
|
(865
|
)
|
|
(421
|
)
|
|||
Net loss attributable to ION
|
$
|
(71,171
|
)
|
|
$
|
(30,242
|
)
|
|
$
|
(65,148
|
)
|
Net loss per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
(5.20
|
)
|
|
$
|
(2.55
|
)
|
|
$
|
(5.71
|
)
|
Diluted
|
$
|
(5.20
|
)
|
|
$
|
(2.55
|
)
|
|
$
|
(5.71
|
)
|
Weighted average number of common shares outstanding:
|
|
|
|
|
|
||||||
Basic
|
13,692
|
|
|
11,876
|
|
|
11,400
|
|
|||
Diluted
|
13,692
|
|
|
11,876
|
|
|
11,400
|
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
Net loss
|
$
|
(70,398
|
)
|
|
$
|
(29,377
|
)
|
|
$
|
(64,727
|
)
|
Other comprehensive income (loss), net of taxes, as appropriate:
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
(1,563
|
)
|
|
2,869
|
|
|
(6,967
|
)
|
|||
Comprehensive net loss
|
(71,961
|
)
|
|
(26,508
|
)
|
|
(71,694
|
)
|
|||
Comprehensive income attributable to noncontrolling interests
|
(773
|
)
|
|
(865
|
)
|
|
(421
|
)
|
|||
Comprehensive net loss attributable to ION
|
$
|
(72,734
|
)
|
|
$
|
(27,373
|
)
|
|
$
|
(72,115
|
)
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net loss
|
$
|
(70,398
|
)
|
|
$
|
(29,377
|
)
|
|
$
|
(64,727
|
)
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization (other than multi-client library)
|
8,763
|
|
|
16,592
|
|
|
21,975
|
|
|||
Amortization of multi-client data library
|
48,988
|
|
|
47,102
|
|
|
33,335
|
|
|||
Impairment of long-lived assets
|
36,553
|
|
|
—
|
|
|
—
|
|
|||
Impairment of multi-client data library
|
—
|
|
|
2,304
|
|
|
—
|
|
|||
Stock-based compensation expense
|
3,337
|
|
|
2,552
|
|
|
3,267
|
|
|||
Accrual (reduction) of loss contingency related to legal proceedings
|
—
|
|
|
5,000
|
|
|
(1,168
|
)
|
|||
Loss on bond exchange
|
—
|
|
|
—
|
|
|
2,182
|
|
|||
Write-down of excess and obsolete inventory
|
665
|
|
|
398
|
|
|
429
|
|
|||
Deferred income taxes
|
(6,252
|
)
|
|
(5,420
|
)
|
|
(1,181
|
)
|
|||
Change in operating assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
(7,024
|
)
|
|
1,692
|
|
|
20,426
|
|
|||
Unbilled receivables
|
(5,245
|
)
|
|
(23,947
|
)
|
|
6,543
|
|
|||
Inventories
|
(353
|
)
|
|
190
|
|
|
2,312
|
|
|||
Accounts payable, accrued expenses and accrued royalties
|
(7,600
|
)
|
|
1,443
|
|
|
(5,085
|
)
|
|||
Deferred revenue
|
(1,112
|
)
|
|
5,131
|
|
|
(2,759
|
)
|
|||
Other assets and liabilities
|
6,776
|
|
|
3,952
|
|
|
(14,556
|
)
|
|||
Net cash provided by operating activities
|
7,098
|
|
|
27,612
|
|
|
993
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Investment in multi-client data library
|
(28,276
|
)
|
|
(23,710
|
)
|
|
(14,884
|
)
|
|||
Purchase of property, plant, equipment and seismic rental equipment
|
(1,514
|
)
|
|
(1,063
|
)
|
|
(1,458
|
)
|
|||
Proceeds from sale of cost method investments
|
—
|
|
|
—
|
|
|
2,698
|
|
|||
Net cash used in investing activities
|
(29,790
|
)
|
|
(24,773
|
)
|
|
(13,644
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Borrowings under revolving line of credit
|
—
|
|
|
—
|
|
|
15,000
|
|
|||
Repayments under revolving line of credit
|
(10,000
|
)
|
|
—
|
|
|
(5,000
|
)
|
|||
Payments on notes payable and long-term debt
|
(30,807
|
)
|
|
(4,816
|
)
|
|
(23,634
|
)
|
|||
Cost associated with issuance of debt
|
(1,247
|
)
|
|
(53
|
)
|
|
(6,744
|
)
|
|||
Net proceeds from issuance of stocks
|
46,999
|
|
|
—
|
|
|
—
|
|
|||
Repurchase of common stock
|
—
|
|
|
—
|
|
|
(964
|
)
|
|||
Proceeds from employee stock purchases and exercise of stock options
|
214
|
|
|
1,619
|
|
|
—
|
|
|||
Dividend payment to noncontrolling interest
|
(200
|
)
|
|
(100
|
)
|
|
—
|
|
|||
Other financing activities
|
(1,151
|
)
|
|
(243
|
)
|
|
(252
|
)
|
|||
Net cash provided by (used in) financing activities
|
3,808
|
|
|
(3,593
|
)
|
|
(21,594
|
)
|
|||
Effect of change in foreign currency exchange rates on cash, cash equivalents and restricted cash
|
319
|
|
|
(260
|
)
|
|
1,386
|
|
|||
Net decrease in cash, cash equivalents and restricted cash
|
(18,565
|
)
|
|
(1,014
|
)
|
|
(32,859
|
)
|
|||
Cash, cash equivalents and restricted cash at beginning of period
|
52,419
|
|
|
53,433
|
|
|
86,292
|
|
|||
Cash, cash equivalents and restricted cash at end of period
|
$
|
33,854
|
|
|
$
|
52,419
|
|
|
$
|
53,433
|
|
|
December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
Cash and cash equivalents
|
$
|
33,551
|
|
|
$
|
52,056
|
|
|
$
|
52,652
|
|
Restricted cash included in prepaid expenses and other current assets
|
—
|
|
|
60
|
|
|
260
|
|
|||
Restricted cash included in other long-term assets
|
303
|
|
|
303
|
|
|
521
|
|
|||
Total cash, cash equivalents, and restricted cash shown in consolidated statements of cash flows
|
$
|
33,854
|
|
|
$
|
52,419
|
|
|
$
|
53,433
|
|
|
Common Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Loss
|
|
Treasury Stock
|
|
Noncontrolling Interests
|
|
Total Equity
|
|||||||||||||||||
(In thousands, except shares)
|
Shares
|
|
Amount
|
|
||||||||||||||||||||||||||
Balance at January 1, 2016 (a)
|
10,702,689
|
|
|
$
|
107
|
|
|
$
|
894,715
|
|
|
$
|
(759,531
|
)
|
|
$
|
(14,781
|
)
|
|
$
|
(8,551
|
)
|
|
$
|
81
|
|
|
$
|
112,040
|
|
Net (loss) income
|
—
|
|
|
—
|
|
|
—
|
|
|
(65,148
|
)
|
|
—
|
|
|
—
|
|
|
421
|
|
|
(64,727
|
)
|
|||||||
Translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,967
|
)
|
|
—
|
|
|
7
|
|
|
(6,960
|
)
|
|||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
3,267
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,267
|
|
|||||||
Vesting of restricted stock units/awards
|
40,495
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Purchase of treasury shares
|
(155,304
|
)
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(963
|
)
|
|
—
|
|
|
(964
|
)
|
|||||||
Restricted stock cancelled for employee minimum income taxes
|
(4,973
|
)
|
|
—
|
|
|
(22
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(22
|
)
|
|||||||
Issuance of stock for the ESPP
|
4,100
|
|
|
—
|
|
|
23
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23
|
|
|||||||
Issuance of stock in bond exchange
|
1,205,440
|
|
|
12
|
|
|
1,215
|
|
|
—
|
|
|
—
|
|
|
9,514
|
|
|
—
|
|
|
10,741
|
|
|||||||
Balance at December 31, 2016
|
11,792,447
|
|
|
118
|
|
|
899,198
|
|
|
(824,679
|
)
|
|
(21,748
|
)
|
|
—
|
|
|
509
|
|
|
53,398
|
|
|||||||
Net (loss) income
|
—
|
|
|
—
|
|
|
—
|
|
|
(30,242
|
)
|
|
—
|
|
|
—
|
|
|
865
|
|
|
(29,377
|
)
|
|||||||
Translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,869
|
|
|
—
|
|
|
(35
|
)
|
|
2,834
|
|
|||||||
Dividend payment to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(100
|
)
|
|
(100
|
)
|
|||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
2,552
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,552
|
|
|||||||
Exercise of stock options
|
15,000
|
|
|
—
|
|
|
46
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46
|
|
|||||||
Vesting of restricted stock units/awards
|
115,576
|
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Employee purchases of unregistered shares of common stock
|
120,567
|
|
|
1
|
|
|
1,572
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,573
|
|
|||||||
Restricted stock cancelled for employee minimum income taxes
|
(23,889
|
)
|
|
—
|
|
|
(120
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(120
|
)
|
|||||||
Balance at December 31, 2017
|
12,019,701
|
|
|
120
|
|
|
903,247
|
|
|
(854,921
|
)
|
|
(18,879
|
)
|
|
—
|
|
|
1,239
|
|
|
30,806
|
|
|||||||
Net (loss) income
|
—
|
|
|
—
|
|
|
—
|
|
|
(71,171
|
)
|
|
—
|
|
|
—
|
|
|
773
|
|
|
(70,398
|
)
|
|||||||
Translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,563
|
)
|
|
—
|
|
|
(220
|
)
|
|
(1,783
|
)
|
|||||||
Dividend payment to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(200
|
)
|
|
(200
|
)
|
|||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
3,337
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,337
|
|
|||||||
Exercise of stock options
|
70,086
|
|
|
1
|
|
|
213
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
214
|
|
|||||||
Vesting of restricted stock units/awards
|
151,852
|
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Restricted stock cancelled for employee minimum income taxes
|
(46,024
|
)
|
|
—
|
|
|
(1,151
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,151
|
)
|
|||||||
Public equity offering
|
1,820,000
|
|
|
18
|
|
|
46,981
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46,999
|
|
|||||||
Balance at December 31, 2018
|
14,015,615
|
|
|
$
|
140
|
|
|
$
|
952,626
|
|
|
$
|
(926,092
|
)
|
|
$
|
(20,442
|
)
|
|
$
|
—
|
|
|
$
|
1,592
|
|
|
$
|
7,824
|
|
(a)
|
The figures for January 1, 2016, set forth in the tables above have been retroactively adjusted to reflect the one-for-fifteen reverse stock split completed on February 4, 2016.
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Gross costs of multi-client data creation
|
$
|
972,309
|
|
|
$
|
939,077
|
|
Less accumulated amortization
|
(776,860
|
)
|
|
(727,872
|
)
|
||
Less impairments to multi-client data library
|
(121,905
|
)
|
|
(121,905
|
)
|
||
Multi-client data library, net
|
$
|
73,544
|
|
|
$
|
89,300
|
|
|
Years Ended December 31,
|
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
||||||
Net revenues:
|
|
|
|
|
|
|
||||||
E&P Technology & Services:
|
|
|
|
|
|
|
||||||
New Venture
|
$
|
69,685
|
|
|
$
|
100,824
|
|
|
$
|
27,362
|
|
|
Data Library
|
47,095
|
|
|
40,016
|
|
|
39,989
|
|
|
|||
Total multi-client revenues
|
116,780
|
|
|
140,840
|
|
|
67,351
|
|
|
|||
Imaging Services
|
19,740
|
|
|
16,409
|
|
|
25,538
|
|
|
|||
Total
|
$
|
136,520
|
|
|
$
|
157,249
|
|
|
$
|
92,889
|
|
|
Operations Optimization:
|
|
|
|
|
|
|
||||||
Devices
|
$
|
22,396
|
|
|
$
|
23,610
|
|
|
$
|
26,746
|
|
|
Optimization Software & Services
|
21,129
|
|
|
16,695
|
|
|
16,756
|
|
|
|||
Total
|
$
|
43,525
|
|
|
$
|
40,305
|
|
|
$
|
43,502
|
|
|
Other
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
36,417
|
|
(a)
|
Total
|
$
|
180,045
|
|
|
$
|
197,554
|
|
|
$
|
172,808
|
|
|
Gross profit (loss):
|
|
|
|
|
|
|
||||||
E&P Technology & Services
|
$
|
43,369
|
|
|
$
|
65,196
|
|
|
$
|
4,708
|
|
|
Operations Optimization
|
22,293
|
|
|
20,076
|
|
|
21,745
|
|
|
|||
Segment gross profit
|
65,662
|
|
|
85,272
|
|
|
26,453
|
|
|
|||
Other (b)
|
(6,042
|
)
|
|
(9,633
|
)
|
|
9,579
|
|
|
|||
Total
|
$
|
59,620
|
|
|
$
|
75,639
|
|
|
$
|
36,032
|
|
|
Gross margin:
|
|
|
|
|
|
|
||||||
E&P Technology & Services
|
32
|
%
|
|
41
|
%
|
|
5
|
%
|
|
|||
Operations Optimization
|
51
|
%
|
|
50
|
%
|
|
50
|
%
|
|
|||
Segment gross margin
|
36
|
%
|
|
43
|
%
|
|
15
|
%
|
|
|||
Other
|
(3
|
)%
|
|
(5
|
)%
|
|
6
|
%
|
|
|||
Total
|
33
|
%
|
|
38
|
%
|
|
21
|
%
|
|
|||
Income (loss) from operations:
|
|
|
|
|
|
|
||||||
E&P Technology & Services
|
$
|
21,758
|
|
|
$
|
42,505
|
|
|
$
|
(16,446
|
)
|
|
Operations Optimization
|
7,295
|
|
|
8,022
|
|
|
9,652
|
|
|
|||
Support and other (c)
|
(83,325
|
)
|
(d)
|
(59,226
|
)
|
|
(36,377
|
)
|
|
|||
Loss from operations
|
(54,272
|
)
|
|
(8,699
|
)
|
|
(43,171
|
)
|
|
|||
Interest expense, net
|
(12,972
|
)
|
|
(16,709
|
)
|
|
(18,485
|
)
|
|
|||
Other income (expense), net
|
(436
|
)
|
|
(3,945
|
)
|
|
1,350
|
|
|
|||
Loss before income taxes
|
$
|
(67,680
|
)
|
|
$
|
(29,353
|
)
|
|
$
|
(60,306
|
)
|
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Depreciation and amortization (including multi-client data library):
|
|
|
|
|
|
||||||
E&P Technology & Services
|
$
|
51,673
|
|
|
$
|
53,663
|
|
|
$
|
44,100
|
|
Operations Optimization
|
995
|
|
|
1,349
|
|
|
1,780
|
|
|||
Support and other (a)
|
5,083
|
|
|
8,682
|
|
|
9,430
|
|
|||
Total
|
$
|
57,751
|
|
|
$
|
63,694
|
|
|
$
|
55,310
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Total assets:
|
|
|
|
||||
E&P Technology & Services
|
$
|
165,132
|
|
|
$
|
156,555
|
|
Operations Optimization
|
51,783
|
|
|
74,361
|
|
||
Support and other (a)
|
27,834
|
|
|
70,153
|
|
||
Total
|
$
|
244,749
|
|
(b)
|
$
|
301,069
|
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Latin America
|
$
|
68,871
|
|
|
$
|
68,241
|
|
|
$
|
24,090
|
|
North America
|
44,474
|
|
|
48,120
|
|
|
38,005
|
|
|||
Europe
|
31,077
|
|
|
44,930
|
|
|
41,674
|
|
|||
Asia Pacific
|
17,817
|
|
|
18,896
|
|
|
16,226
|
|
|||
Africa
|
10,837
|
|
|
6,837
|
|
|
41,417
|
|
|||
Middle East
|
5,526
|
|
|
2,308
|
|
|
9,467
|
|
|||
Commonwealth of Independent States
|
1,443
|
|
|
8,222
|
|
|
1,929
|
|
|||
Total
|
$
|
180,045
|
|
|
$
|
197,554
|
|
|
$
|
172,808
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
New Venture
|
$
|
38,430
|
|
|
$
|
33,183
|
|
Imaging Services
|
5,075
|
|
|
4,121
|
|
||
Devices
|
527
|
|
|
—
|
|
||
Total
|
$
|
44,032
|
|
|
$
|
37,304
|
|
|
|
||
Unbilled receivables at December 31, 2017
|
$
|
37,304
|
|
Recognition of unbilled receivables
|
153,611
|
|
|
Revenues billed to customers
|
(146,883
|
)
|
|
Unbilled receivables at December 31, 2018
|
$
|
44,032
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
New Venture
|
$
|
5,797
|
|
|
$
|
6,548
|
|
Imaging Services
|
307
|
|
|
676
|
|
||
Devices
|
626
|
|
|
633
|
|
||
Optimization Software & Services
|
980
|
|
|
1,053
|
|
||
Total
|
$
|
7,710
|
|
|
$
|
8,910
|
|
|
|
||
Deferred revenue at December 31, 2017
|
$
|
8,910
|
|
Cash collected in excess of revenue recognized
|
25,234
|
|
|
Recognition of deferred revenue (a)
|
(26,434
|
)
|
|
Deferred revenue at December 31, 2018
|
$
|
7,710
|
|
|
|
December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Senior secured second-priority lien notes (maturing December 15, 2021)
|
|
$
|
120,569
|
|
|
$
|
120,569
|
|
Senior secured third-priority lien notes (redeemed March 26, 2018)
|
|
—
|
|
|
28,497
|
|
||
Revolving credit facility (amended August 16, 2018, maturing August 16, 2023) (a)
|
|
—
|
|
|
10,000
|
|
||
Equipment capital leases
|
|
2,938
|
|
|
279
|
|
||
Other debt
|
|
1,159
|
|
|
1,382
|
|
||
Costs associated with issuances of debt
|
|
(2,925
|
)
|
|
(3,983
|
)
|
||
Total
|
|
121,741
|
|
|
156,744
|
|
||
Current portion of long-term debt and lease obligations
|
|
(2,228
|
)
|
|
(40,024
|
)
|
||
Non-current portion of long-term debt and lease obligations
|
|
$
|
119,513
|
|
|
$
|
116,720
|
|
•
|
extend the maturity date of the Credit Facility by approximately four years (from August 22, 2019 to August 16, 2023), subject to the retirement or extension of the maturity date of the Second Lien Notes, as defined below, which mature on December 15, 2021;
|
•
|
increase the maximum revolver amount by $10 million (from $40 million to $50 million);
|
•
|
increase the borrowing base percentage of the net orderly liquidation value as it relates to the multi-client data library (not to exceed $28.5 million, up from the previous maximum of $15 million for the multi-client data library component);
|
•
|
include the eligible billed receivables of the Mexican Subsidiary up to a maximum of $5 million in the borrowing base calculation and joins the Mexican Subsidiary as a borrower thereunder (with a maximum exposure of $5 million) and require the equity and assets of the Mexican Subsidiary to be pledged to secure obligations under the Credit Facility;
|
•
|
modify the interest rate such that the maximum interest rate remains consistent with the fixed interest rate prior to the Third Amendment (that is, 3.00% per annum for domestic rate loans and 4.00% per annum for LIBOR rate loans), but now lowers the range down to a minimum interest rate of 2.00% for domestic rate loans and 3.00% for LIBOR rate loans based on a leverage ratio for the preceding four-quarter period;
|
•
|
decrease the minimum excess borrowing availability threshold which (if the Borrowers have minimum excess borrowing availability below any such threshold) triggers the agent’s right to exercise dominion over cash and deposit accounts; and
|
•
|
modify the trigger required to test for compliance with the fixed charge coverage ratio, which is further described below.
|
Date
|
|
Percentage
|
2019
|
|
105.500%
|
2020
|
|
103.500%
|
2021 and thereafter
|
|
100.000%
|
Years Ending December 31,
|
|
Short-Term and Long-Term Debt
|
|
Capital Lease Obligations
|
|
Other Financing
|
|
Total
|
||||||||
2019
|
|
$
|
—
|
|
|
$
|
1,069
|
|
|
1,159
|
|
|
$
|
2,228
|
|
|
2020
|
|
—
|
|
|
1,135
|
|
|
—
|
|
|
1,135
|
|
||||
2021
|
|
120,569
|
|
|
734
|
|
|
—
|
|
|
121,303
|
|
||||
Total
|
|
$
|
120,569
|
|
|
$
|
2,938
|
|
|
$
|
1,159
|
|
|
$
|
124,666
|
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
—
|
|
|
$
|
(166
|
)
|
|
$
|
—
|
|
State and local
|
65
|
|
|
116
|
|
|
28
|
|
|||
Foreign
|
8,905
|
|
|
5,494
|
|
|
5,574
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
Federal
|
(346
|
)
|
|
(1,263
|
)
|
|
—
|
|
|||
Foreign
|
(5,906
|
)
|
|
(4,157
|
)
|
|
(1,181
|
)
|
|||
Total income tax expense
|
$
|
2,718
|
|
|
$
|
24
|
|
|
$
|
4,421
|
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Expected income tax expense at 21% for 2018 and 35% for 2017 and 2016
|
$
|
(14,213
|
)
|
|
$
|
(10,274
|
)
|
|
$
|
(21,107
|
)
|
Foreign tax rate differential
|
74
|
|
|
(2,914
|
)
|
|
5,932
|
|
|||
Foreign tax differences
|
4,703
|
|
|
(5,610
|
)
|
|
(4,828
|
)
|
|||
Global intangible low tax income inclusion
|
3,443
|
|
|
—
|
|
|
—
|
|
|||
State and local taxes
|
65
|
|
|
116
|
|
|
28
|
|
|||
Nondeductible expenses
|
1,604
|
|
|
4,308
|
|
|
(259
|
)
|
|||
Change in U.S. tax rate
|
—
|
|
|
77,410
|
|
|
—
|
|
|||
Expired capital loss
|
—
|
|
|
1,114
|
|
|
1,321
|
|
|||
Valuation allowance:
|
|
|
|
|
|
||||||
Valuation allowance on expiring capital losses
|
—
|
|
|
(1,114
|
)
|
|
(1,321
|
)
|
|||
Valuation allowance on operations
|
7,042
|
|
|
(63,012
|
)
|
|
24,655
|
|
|||
Total income tax expense
|
$
|
2,718
|
|
|
$
|
24
|
|
|
$
|
4,421
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Deferred income tax assets:
|
|
|
|
||||
Accrued expenses
|
$
|
1,126
|
|
|
$
|
1,976
|
|
Allowance accounts
|
6,415
|
|
|
2,960
|
|
||
Net operating loss carryforward
|
96,854
|
|
|
87,705
|
|
||
Equity method investment
|
35,292
|
|
|
35,292
|
|
||
Original issue discount
|
8,073
|
|
|
9,624
|
|
||
Interest limitation
|
5,845
|
|
|
—
|
|
||
Basis in identified intangibles
|
4,146
|
|
|
9,408
|
|
||
Tax credit carryforwards
|
5,345
|
|
|
6,929
|
|
||
Contingency accrual
|
—
|
|
|
788
|
|
||
Other
|
4,600
|
|
|
4,035
|
|
||
Total deferred income tax asset
|
167,696
|
|
|
158,717
|
|
||
Valuation allowance
|
(160,505
|
)
|
|
(153,463
|
)
|
||
Net deferred income tax asset
|
7,191
|
|
|
5,254
|
|
||
Deferred income tax liabilities:
|
|
|
|
||||
Unbilled receivables
|
—
|
|
|
(3,501
|
)
|
||
Total deferred income tax asset, net
|
$
|
7,191
|
|
|
$
|
1,753
|
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Beginning balance
|
$
|
447
|
|
|
$
|
1,299
|
|
|
$
|
1,250
|
|
Increases in unrecognized tax benefits – current year positions
|
—
|
|
|
59
|
|
|
49
|
|
|||
Decreases in unrecognized tax benefits – prior year position
|
—
|
|
|
(911
|
)
|
|
—
|
|
|||
Ending balance
|
$
|
447
|
|
|
$
|
447
|
|
|
$
|
1,299
|
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
(Accrual for) reduction of loss contingency related to legal proceedings (Footnote 8)
|
$
|
—
|
|
|
$
|
(5,000
|
)
|
|
$
|
1,168
|
|
Recovery of INOVA bad debts
|
—
|
|
|
844
|
|
|
3,983
|
|
|||
Loss on bond exchange
|
—
|
|
|
—
|
|
|
(2,182
|
)
|
|||
Other income (expense)
|
(436
|
)
|
|
211
|
|
|
(1,619
|
)
|
|||
Total other income (expense), net
|
$
|
(436
|
)
|
|
$
|
(3,945
|
)
|
|
$
|
1,350
|
|
A summary of accounts receivable follows (in thousands):
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Accounts receivable, principally trade
|
$
|
26,558
|
|
|
$
|
20,050
|
|
Less allowance for doubtful accounts
|
(430
|
)
|
|
(572
|
)
|
||
Accounts receivable, net
|
$
|
26,128
|
|
|
$
|
19,478
|
|
A summary of inventories follows (in thousands):
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Raw materials and purchased subassemblies
|
$
|
20,011
|
|
|
$
|
20,448
|
|
Work-in-process
|
1,032
|
|
|
1,146
|
|
||
Finished goods
|
8,111
|
|
|
7,953
|
|
||
Less reserve for excess and obsolete inventories
|
(15,024
|
)
|
|
(15,039
|
)
|
||
Inventories, net
|
$
|
14,130
|
|
|
$
|
14,508
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Buildings
|
$
|
15,707
|
|
|
$
|
15,822
|
|
Machinery and equipment
|
132,135
|
|
|
145,654
|
|
||
Seismic rental equipment
|
1,423
|
|
|
1,677
|
|
||
Furniture and fixtures
|
3,859
|
|
|
3,869
|
|
||
Other
|
30,104
|
|
|
28,965
|
|
||
Total
|
183,228
|
|
|
195,987
|
|
||
Less accumulated depreciation
|
(133,634
|
)
|
|
(143,834
|
)
|
||
Less impairment of long-lived assets
|
(36,553
|
)
|
|
—
|
|
||
Property, plant, equipment and seismic rental equipment, net
|
$
|
13,041
|
|
|
$
|
52,153
|
|
A summary of accrued expenses follows (in thousands):
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Compensation, including compensation-related taxes and commissions
|
$
|
14,502
|
|
|
$
|
19,809
|
|
Accrued multi-client data library acquisition costs
|
3,746
|
|
|
5,104
|
|
||
Income tax payable
|
7,577
|
|
|
1,868
|
|
||
Accrual for loss contingency related to legal proceedings (Footnote 8)
|
—
|
|
|
3,750
|
|
||
Other
|
5,586
|
|
|
8,166
|
|
||
Total
|
$
|
31,411
|
|
|
$
|
38,697
|
|
A summary of other long-term liabilities follows (in thousands):
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Deferred lease liabilities
|
11,465
|
|
|
12,811
|
|
||
Other
|
429
|
|
|
1,115
|
|
||
Total
|
$
|
11,894
|
|
|
$
|
13,926
|
|
|
E&P Technology & Services
|
|
Optimization Software & Services
|
|
Total
|
||||||
Balance at January 1, 2017
|
$
|
2,943
|
|
|
$
|
19,265
|
|
|
$
|
22,208
|
|
Impact of foreign currency translation adjustments
|
—
|
|
|
1,881
|
|
|
1,881
|
|
|||
Balance at December 31, 2017
|
2,943
|
|
|
21,146
|
|
|
24,089
|
|
|||
Impact of foreign currency translation adjustments
|
—
|
|
|
(1,174
|
)
|
|
(1,174
|
)
|
|||
Balance at December 31, 2018
|
$
|
2,943
|
|
|
$
|
19,972
|
|
|
$
|
22,915
|
|
|
Option Price
per Share
|
|
Outstanding
|
|
Vested
|
|
Available
for Grant
|
||||
January 1, 2016
|
$34.20 - $245.85
|
|
|
560,797
|
|
|
384,305
|
|
|
97,003
|
|
Increase in shares authorized
|
—
|
|
|
—
|
|
|
—
|
|
|
1,150,940
|
|
Granted
|
3.10
|
|
|
415,000
|
|
|
—
|
|
|
(415,000
|
)
|
Vested
|
—
|
|
|
—
|
|
|
67,480
|
|
|
—
|
|
Cancelled/forfeited
|
3.10 - 245.85
|
|
|
(128,162
|
)
|
|
(103,432
|
)
|
|
18,895
|
|
Restricted stock granted out of option plans
|
—
|
|
|
—
|
|
|
—
|
|
|
(259,300
|
)
|
Restricted stock forfeited or cancelled for employee minimum income taxes and returned to the plans
|
—
|
|
|
—
|
|
|
—
|
|
|
7,182
|
|
December 31, 2016
|
$3.10 - $245.85
|
|
|
847,635
|
|
|
348,353
|
|
|
599,720
|
|
Granted
|
13.15
|
|
|
156,000
|
|
|
—
|
|
|
(156,000
|
)
|
Vested
|
—
|
|
|
—
|
|
|
149,537
|
|
|
—
|
|
Exercised
|
3.10
|
|
|
(15,000
|
)
|
|
(15,000
|
)
|
|
—
|
|
Cancelled/forfeited
|
3.10 - 245.85
|
|
|
(98,294
|
)
|
|
(47,612
|
)
|
|
82,118
|
|
Restricted stock granted out of option plans
|
—
|
|
|
—
|
|
|
—
|
|
|
(59,500
|
)
|
Restricted stock forfeited or cancelled for employee minimum income taxes and returned to the plans
|
—
|
|
|
—
|
|
|
—
|
|
|
22,065
|
|
December 31, 2017
|
3.10 - 245.85
|
|
|
890,341
|
|
|
435,278
|
|
|
488,403
|
|
Increase in shares authorized
|
—
|
|
|
—
|
|
|
—
|
|
|
1,200,000
|
|
Granted
|
24.50
|
|
|
10,000
|
|
|
—
|
|
|
(10,000
|
)
|
Vested
|
—
|
|
|
—
|
|
|
153,944
|
|
|
—
|
|
Exercised
|
3.10
|
|
|
(70,086
|
)
|
|
(70,086
|
)
|
|
—
|
|
Cancelled/forfeited
|
3.10 - 245.85
|
|
|
(44,365
|
)
|
|
(44,231
|
)
|
|
2,568
|
|
Restricted stock granted out of option plans
|
—
|
|
|
—
|
|
|
—
|
|
|
(996,775
|
)
|
Restricted stock forfeited or cancelled for employee minimum income taxes and returned to the plans
|
—
|
|
|
—
|
|
|
—
|
|
|
48,524
|
|
December 31, 2018
|
$3.10 - $151.35
|
|
|
785,890
|
|
|
474,905
|
|
|
732,720
|
|
Option Price per Share
|
Outstanding
|
|
Weighted Average Exercise Price of Outstanding Options
|
|
Weighted Average Remaining Contract Life
|
|
Vested
|
|
Weighted Average Exercise Price of Vested Options
|
||||||
$3.10 - $57.90
|
558,997
|
|
|
$
|
15.64
|
|
|
7.2 years
|
|
248,012
|
|
|
$
|
24.32
|
|
$61.05 - $71.85
|
75,231
|
|
|
$
|
62.17
|
|
|
4.7 years
|
|
75,231
|
|
|
$
|
62.17
|
|
$81.60 - $99.60
|
108,610
|
|
|
$
|
88.94
|
|
|
3.6 years
|
|
108,610
|
|
|
$
|
88.94
|
|
$106.05 - $151.35
|
43,052
|
|
|
$
|
108.84
|
|
|
2.3 years
|
|
43,052
|
|
|
$
|
108.84
|
|
Totals
|
785,890
|
|
|
$
|
35.33
|
|
|
5.4 years
|
|
474,905
|
|
|
$
|
52.76
|
|
|
Number of Shares
|
|
Weighted Average Exercise Price
|
|
Weighted Average Grant Date Fair Value
|
|
Weighted Average Remaining Contractual Life
|
|
Aggregate Intrinsic Value (000’s)
|
|||||||
Total outstanding at January 1, 2018
|
890,341
|
|
|
$
|
36.17
|
|
|
|
|
6.4 years
|
|
$
|
6,774
|
|
||
Options granted
|
10,000
|
|
|
$
|
24.50
|
|
|
$
|
15.23
|
|
|
|
|
|
||
Options exercised
|
(70,086
|
)
|
|
$
|
3.10
|
|
|
|
|
|
|
|
||||
Options cancelled
|
(134
|
)
|
|
$
|
61.05
|
|
|
|
|
|
|
|
||||
Options forfeited
|
(44,231
|
)
|
|
$
|
100.85
|
|
|
|
|
|
|
|
||||
Total outstanding at December 31, 2018
|
785,890
|
|
|
$
|
35.33
|
|
|
|
|
5.4 years
|
|
$
|
572
|
|
||
Options exercisable and vested at December 31, 2018
|
474,905
|
|
|
$
|
52.76
|
|
|
|
|
5 years
|
|
$
|
213
|
|
|
Years Ended December 31,
|
||||
|
2018
|
|
2017
|
|
2016
|
Risk-free interest rates
|
2.78%
|
|
2.14%
|
|
1.3%
|
Expected lives (in years)
|
5.0
|
|
5.0
|
|
5.5
|
Expected dividend yield
|
—%
|
|
—%
|
|
—%
|
Expected volatility
|
73.67%
|
|
74.41%
|
|
78.76%
|
|
Number of
Shares/Units
|
|
Total nonvested at January 1, 2018
|
201,702
|
|
Granted
|
996,775
|
|
Vested
|
(151,852
|
)
|
Forfeited
|
(2,500
|
)
|
Total nonvested at December 31, 2018
|
1,044,125
|
|
Risk-free interest rates
|
3.0
|
%
|
Expected lives (in years)
|
5.31
|
|
Expected dividend yield
|
—
|
%
|
Expected volatility
|
82.9
|
%
|
|
Number of Shares
|
|
Weighted Average Exercise Price
|
|
Weighted Average Grant Date Fair Value
|
|
Weighted Average Remaining Contractual Life
|
|
Aggregate Intrinsic Value (000’s)
|
|||||||
Total outstanding at January 1, 2016
|
216,532
|
|
|
$
|
34.67
|
|
|
|
|
|
|
|
|
|||
SARs granted
|
1,210,000
|
|
|
$
|
3.10
|
|
|
$
|
17.55
|
|
|
|
|
|
||
SARs cancelled
|
(10,399
|
)
|
|
$
|
34.20
|
|
|
|
|
|
|
|
||||
Total outstanding at December 31, 2016
|
1,416,133
|
|
|
$
|
7.70
|
|
|
|
|
|
|
|
||||
SARs exercised
|
(713,330
|
)
|
|
$
|
3.10
|
|
|
|
|
|
|
|
||||
SARs cancelled
|
(136,939
|
)
|
|
$
|
7.70
|
|
|
|
|
|
|
|
||||
Total outstanding at December 31, 2017
|
565,864
|
|
|
$
|
13.49
|
|
|
|
|
|
|
|
||||
SARs granted
|
960,009
|
|
|
$
|
8.85
|
|
|
8.85
|
|
|
|
|
|
|||
SARs exercised
|
(34,999
|
)
|
|
$
|
3.10
|
|
|
|
|
|
|
|
||||
SARs forfeited
|
(9,333
|
)
|
|
$
|
45.00
|
|
|
|
|
|
|
|
||||
Total outstanding at December 31, 2018
|
1,481,541
|
|
|
$
|
10.53
|
|
|
|
|
8.1 years
|
|
$
|
718
|
|
||
SARs exercisable and vested at December 31, 2018
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Stock-based compensation expense
|
$
|
3,337
|
|
|
$
|
2,552
|
|
|
$
|
3,267
|
|
Tax benefit related thereto
|
(698
|
)
|
|
(862
|
)
|
|
(1,168
|
)
|
|||
Stock-based compensation expense, net of tax
|
$
|
2,639
|
|
|
$
|
1,690
|
|
|
$
|
2,099
|
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Stock appreciation rights expense
|
$
|
822
|
|
|
$
|
6,611
|
|
|
547
|
|
|
Tax benefit related thereto
|
(173
|
)
|
|
(2,314
|
)
|
|
(191
|
)
|
|||
Stock appreciation rights expense, net of tax
|
$
|
649
|
|
|
$
|
4,297
|
|
|
$
|
356
|
|
|
Years Ended December 31,
|
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
||||||
Cash paid during the period for:
|
|
|
|
|
|
|
||||||
Interest
|
$
|
5,731
|
|
|
$
|
14,181
|
|
|
$
|
15,691
|
|
|
Income taxes
|
3,260
|
|
|
7,030
|
|
|
4,474
|
|
|
|||
Non-cash items from investing and financing activities:
|
|
|
|
|
|
|
||||||
Purchase of computer equipment financed through capital leases
|
3,297
|
|
|
—
|
|
|
—
|
|
|
|||
Leasehold improvement paid by landlord
|
—
|
|
|
—
|
|
|
955
|
|
|
|||
Issuance of stock in bond exchange
|
—
|
|
|
—
|
|
|
10,741
|
|
|
|||
Transfer of inventory to property, plant and equipment
|
—
|
|
|
—
|
|
|
17,662
|
|
(a)
|
|||
Investment in multi-client data library financed through trade payables
|
4,956
|
|
|
9,059
|
|
|
—
|
|
|
(a)
|
This transfer of $17.7 million of inventory to property, plant, equipment and seismic rental equipment in December 2016, relates to ocean bottom seismic equipment manufactured by the Company to be deployed in the acquisition of ocean bottom seismic data.
|
|
Three Months Ended
|
||||||||||||||
|
March 31, 2018
|
|
June 30, 2018
|
|
September 30, 2018
|
|
December 31, 2018
|
||||||||
Service revenues
|
$
|
25,086
|
|
|
$
|
15,752
|
|
|
$
|
37,105
|
|
|
$
|
61,095
|
|
Product revenues
|
8,422
|
|
|
8,991
|
|
|
10,095
|
|
|
13,499
|
|
||||
Total net revenues
|
33,508
|
|
|
24,743
|
|
|
47,200
|
|
|
74,594
|
|
||||
Gross profit (loss)
|
6,853
|
|
|
(1,517
|
)
|
|
16,475
|
|
|
37,809
|
|
||||
Loss from operations
|
(12,640
|
)
|
|
(22,519
|
)
|
|
(2,452
|
)
|
|
(16,661
|
)
|
||||
Interest expense, net
|
(3,836
|
)
|
|
(2,911
|
)
|
|
(3,022
|
)
|
|
(3,203
|
)
|
||||
Other income (expense), net
|
(791
|
)
|
|
84
|
|
|
91
|
|
|
180
|
|
||||
Income tax expense (benefit)
|
1,072
|
|
|
154
|
|
|
2,079
|
|
|
(587
|
)
|
||||
Net income attributable to noncontrolling interests
|
(87
|
)
|
|
(366
|
)
|
|
(74
|
)
|
|
(246
|
)
|
||||
Net loss applicable to ION
|
$
|
(18,426
|
)
|
|
$
|
(25,866
|
)
|
|
$
|
(7,536
|
)
|
|
$
|
(19,343
|
)
|
Net loss per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(1.44
|
)
|
|
$
|
(1.86
|
)
|
|
$
|
(0.54
|
)
|
|
$
|
(1.38
|
)
|
Diluted
|
$
|
(1.44
|
)
|
|
$
|
(1.86
|
)
|
|
$
|
(0.54
|
)
|
|
$
|
(1.38
|
)
|
|
Three Months Ended
|
||||||||||||||
|
March 31, 2017
|
|
June 30, 2017
|
|
September 30, 2017
|
|
December 31, 2017
|
||||||||
Service revenues
|
$
|
23,828
|
|
|
$
|
34,454
|
|
|
$
|
52,615
|
|
|
$
|
48,513
|
|
Product revenues
|
8,728
|
|
|
11,547
|
|
|
8,480
|
|
|
9,389
|
|
||||
Total net revenues
|
32,556
|
|
|
46,001
|
|
|
61,095
|
|
|
57,902
|
|
||||
Gross profit
|
6,101
|
|
|
15,618
|
|
|
30,109
|
|
|
23,811
|
|
||||
Income (loss) from operations
|
(13,912
|
)
|
|
(3,572
|
)
|
|
9,936
|
|
|
(1,151
|
)
|
||||
Interest expense, net
|
(4,464
|
)
|
|
(4,241
|
)
|
|
(3,959
|
)
|
|
(4,045
|
)
|
||||
Other income (expense), net
|
(5,068
|
)
|
|
192
|
|
|
722
|
|
|
209
|
|
||||
Income tax expense (benefit)
|
(418
|
)
|
|
2,402
|
|
|
1,686
|
|
|
(3,646
|
)
|
||||
Net income attributable to noncontrolling interests
|
(316
|
)
|
|
(418
|
)
|
|
(78
|
)
|
|
(53
|
)
|
||||
Net income (loss) applicable to ION
|
$
|
(23,342
|
)
|
|
$
|
(10,441
|
)
|
|
$
|
4,935
|
|
|
$
|
(1,394
|
)
|
Net income (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(1.98
|
)
|
|
$
|
(0.88
|
)
|
|
$
|
0.42
|
|
|
$
|
(0.12
|
)
|
Diluted
|
$
|
(1.98
|
)
|
|
$
|
(0.88
|
)
|
|
$
|
0.41
|
|
|
$
|
(0.12
|
)
|
•
|
ION Geophysical Corporation and the Guarantors (in each case, reflecting investments in subsidiaries utilizing the equity method of accounting).
|
•
|
All other subsidiaries of ION Geophysical Corporation that are non-guarantors.
|
•
|
The consolidating adjustments necessary to present ION Geophysical Corporation’s results on a consolidated basis.
|
|
December 31, 2018
|
||||||||||||||||||
Balance Sheet
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
13,782
|
|
|
$
|
47
|
|
|
$
|
19,722
|
|
|
$
|
—
|
|
|
$
|
33,551
|
|
Accounts receivable, net
|
8
|
|
|
17,349
|
|
|
8,771
|
|
|
—
|
|
|
26,128
|
|
|||||
Unbilled receivables
|
—
|
|
|
12,697
|
|
|
31,335
|
|
|
—
|
|
|
44,032
|
|
|||||
Inventories
|
—
|
|
|
8,721
|
|
|
5,409
|
|
|
—
|
|
|
14,130
|
|
|||||
Prepaid expenses and other current assets
|
3,891
|
|
|
1,325
|
|
|
2,566
|
|
|
—
|
|
|
7,782
|
|
|||||
Total current assets
|
17,681
|
|
|
40,139
|
|
|
67,803
|
|
|
—
|
|
|
125,623
|
|
|||||
Deferred income tax asset
|
805
|
|
|
6,261
|
|
|
125
|
|
|
—
|
|
|
7,191
|
|
|||||
Property, plant, equipment and seismic rental equipment, net
|
489
|
|
|
8,922
|
|
|
3,630
|
|
|
—
|
|
|
13,041
|
|
|||||
Multi-client data library, net
|
—
|
|
|
70,380
|
|
|
3,164
|
|
|
—
|
|
|
73,544
|
|
|||||
Investment in subsidiaries
|
836,002
|
|
|
247,359
|
|
|
—
|
|
|
(1,083,361
|
)
|
|
—
|
|
|||||
Goodwill
|
—
|
|
|
—
|
|
|
22,915
|
|
|
—
|
|
|
22,915
|
|
|||||
Intercompany receivables
|
—
|
|
|
305,623
|
|
|
66,021
|
|
|
(371,644
|
)
|
|
—
|
|
|||||
Other assets
|
1,723
|
|
|
643
|
|
|
69
|
|
|
—
|
|
|
2,435
|
|
|||||
Total assets
|
$
|
856,700
|
|
|
$
|
679,327
|
|
|
$
|
163,727
|
|
|
$
|
(1,455,005
|
)
|
|
$
|
244,749
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current maturities of long-term debt
|
$
|
1,159
|
|
|
$
|
1,069
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,228
|
|
Accounts payable
|
2,407
|
|
|
29,602
|
|
|
2,904
|
|
|
—
|
|
|
34,913
|
|
|||||
Accrued expenses
|
7,011
|
|
|
10,036
|
|
|
14,364
|
|
|
—
|
|
|
31,411
|
|
|||||
Accrued multi-client data library royalties
|
—
|
|
|
29,040
|
|
|
216
|
|
|
—
|
|
|
29,256
|
|
|||||
Deferred revenue
|
—
|
|
|
6,515
|
|
|
1,195
|
|
|
—
|
|
|
7,710
|
|
|||||
Total current liabilities
|
10,577
|
|
|
76,262
|
|
|
18,679
|
|
|
—
|
|
|
105,518
|
|
|||||
Long-term debt, net of current maturities
|
117,644
|
|
|
1,869
|
|
|
—
|
|
|
—
|
|
|
119,513
|
|
|||||
Intercompany payables
|
721,817
|
|
|
—
|
|
|
—
|
|
|
(721,817
|
)
|
|
—
|
|
|||||
Other long-term liabilities
|
430
|
|
|
5,698
|
|
|
5,766
|
|
|
—
|
|
|
11,894
|
|
|||||
Total liabilities
|
850,468
|
|
|
83,829
|
|
|
24,445
|
|
|
(721,817
|
)
|
|
236,925
|
|
|||||
Equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock
|
140
|
|
|
290,460
|
|
|
47,776
|
|
|
(338,236
|
)
|
|
140
|
|
|||||
Additional paid-in capital
|
952,626
|
|
|
180,700
|
|
|
203,908
|
|
|
(384,608
|
)
|
|
952,626
|
|
|||||
Accumulated earnings (deficit)
|
(926,092
|
)
|
|
390,691
|
|
|
(12,475
|
)
|
|
(378,216
|
)
|
|
(926,092
|
)
|
|||||
Accumulated other comprehensive income (loss)
|
(20,442
|
)
|
|
4,324
|
|
|
(22,023
|
)
|
|
17,699
|
|
|
(20,442
|
)
|
|||||
Due from ION Geophysical Corporation
|
—
|
|
|
(270,677
|
)
|
|
(79,496
|
)
|
|
350,173
|
|
|
—
|
|
|||||
Total stockholders’ equity
|
6,232
|
|
|
595,498
|
|
|
137,690
|
|
|
(733,188
|
)
|
|
6,232
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
1,592
|
|
|
—
|
|
|
1,592
|
|
|||||
Total equity
|
6,232
|
|
|
595,498
|
|
|
139,282
|
|
|
(733,188
|
)
|
|
7,824
|
|
|||||
Total liabilities and equity
|
$
|
856,700
|
|
|
$
|
679,327
|
|
|
$
|
163,727
|
|
|
$
|
(1,455,005
|
)
|
|
$
|
244,749
|
|
|
December 31, 2017
|
||||||||||||||||||
Balance Sheet
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
39,344
|
|
|
$
|
66
|
|
|
$
|
12,646
|
|
|
$
|
—
|
|
|
$
|
52,056
|
|
Accounts receivable, net
|
50
|
|
|
12,496
|
|
|
6,932
|
|
|
—
|
|
|
19,478
|
|
|||||
Unbilled receivables
|
—
|
|
|
34,484
|
|
|
2,820
|
|
|
—
|
|
|
37,304
|
|
|||||
Inventories
|
—
|
|
|
8,686
|
|
|
5,822
|
|
|
—
|
|
|
14,508
|
|
|||||
Prepaid expenses and other current assets
|
2,427
|
|
|
4,530
|
|
|
686
|
|
|
—
|
|
|
7,643
|
|
|||||
Total current assets
|
41,821
|
|
|
60,262
|
|
|
28,906
|
|
|
—
|
|
|
130,989
|
|
|||||
Deferred income tax asset
|
1,264
|
|
|
336
|
|
|
153
|
|
|
—
|
|
|
1,753
|
|
|||||
Property, plant, equipment and seismic rental equipment, net
|
511
|
|
|
7,170
|
|
|
44,472
|
|
|
—
|
|
|
52,153
|
|
|||||
Multi-client data library, net
|
—
|
|
|
81,442
|
|
|
7,858
|
|
|
—
|
|
|
89,300
|
|
|||||
Investment in subsidiaries
|
693,679
|
|
|
321,934
|
|
|
—
|
|
|
(1,015,613
|
)
|
|
—
|
|
|||||
Goodwill
|
—
|
|
|
—
|
|
|
24,089
|
|
|
—
|
|
|
24,089
|
|
|||||
Intercompany receivables
|
—
|
|
|
162,017
|
|
|
60,394
|
|
|
(222,411
|
)
|
|
—
|
|
|||||
Other assets
|
686
|
|
|
1,811
|
|
|
288
|
|
|
—
|
|
|
2,785
|
|
|||||
Total assets
|
$
|
737,961
|
|
|
$
|
634,972
|
|
|
$
|
166,160
|
|
|
$
|
(1,238,024
|
)
|
|
$
|
301,069
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current maturities of long-term debt
|
$
|
39,774
|
|
|
$
|
250
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
40,024
|
|
Accounts payable
|
1,774
|
|
|
20,982
|
|
|
2,195
|
|
|
—
|
|
|
24,951
|
|
|||||
Accrued expenses
|
12,284
|
|
|
16,957
|
|
|
9,456
|
|
|
—
|
|
|
38,697
|
|
|||||
Accrued multi-client data library royalties
|
—
|
|
|
26,824
|
|
|
211
|
|
|
—
|
|
|
27,035
|
|
|||||
Deferred revenue
|
—
|
|
|
7,231
|
|
|
1,679
|
|
|
—
|
|
|
8,910
|
|
|||||
Total current liabilities
|
53,832
|
|
|
72,244
|
|
|
13,541
|
|
|
—
|
|
|
139,617
|
|
|||||
Long-term debt, net of current maturities
|
116,691
|
|
|
29
|
|
|
—
|
|
|
—
|
|
|
116,720
|
|
|||||
Intercompany payables
|
537,417
|
|
|
—
|
|
|
—
|
|
|
(537,417
|
)
|
|
—
|
|
|||||
Other long-term liabilities
|
454
|
|
|
6,084
|
|
|
7,388
|
|
|
—
|
|
|
13,926
|
|
|||||
Total liabilities
|
708,394
|
|
|
78,357
|
|
|
20,929
|
|
|
(537,417
|
)
|
|
270,263
|
|
|||||
Equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock
|
120
|
|
|
290,460
|
|
|
49,394
|
|
|
(339,854
|
)
|
|
120
|
|
|||||
Additional paid-in capital
|
903,247
|
|
|
180,701
|
|
|
202,290
|
|
|
(382,991
|
)
|
|
903,247
|
|
|||||
Accumulated earnings (deficit)
|
(854,921
|
)
|
|
317,324
|
|
|
(9,247
|
)
|
|
(308,077
|
)
|
|
(854,921
|
)
|
|||||
Accumulated other comprehensive income (loss)
|
(18,879
|
)
|
|
4,372
|
|
|
(19,681
|
)
|
|
15,309
|
|
|
(18,879
|
)
|
|||||
Due from ION Geophysical Corporation
|
—
|
|
|
(236,242
|
)
|
|
(78,764
|
)
|
|
315,006
|
|
|
—
|
|
|||||
Total stockholders’ equity
|
29,567
|
|
|
556,615
|
|
|
143,992
|
|
|
(700,607
|
)
|
|
29,567
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
1,239
|
|
|
—
|
|
|
1,239
|
|
|||||
Total equity
|
29,567
|
|
|
556,615
|
|
|
145,231
|
|
|
(700,607
|
)
|
|
30,806
|
|
|||||
Total liabilities and equity
|
$
|
737,961
|
|
|
$
|
634,972
|
|
|
$
|
166,160
|
|
|
$
|
(1,238,024
|
)
|
|
$
|
301,069
|
|
|
Year Ended December 31, 2018
|
||||||||||||||||||
Income Statement
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Total net revenues
|
$
|
—
|
|
|
$
|
96,649
|
|
|
$
|
83,396
|
|
|
$
|
—
|
|
|
$
|
180,045
|
|
Cost of goods sold
|
—
|
|
|
85,186
|
|
|
35,239
|
|
|
—
|
|
|
120,425
|
|
|||||
Gross profit
|
—
|
|
|
11,463
|
|
|
48,157
|
|
|
—
|
|
|
59,620
|
|
|||||
Total operating expenses
|
32,888
|
|
|
29,235
|
|
|
51,769
|
|
|
—
|
|
|
113,892
|
|
|||||
Loss from operations
|
(32,888
|
)
|
|
(17,772
|
)
|
|
(3,612
|
)
|
|
—
|
|
|
(54,272
|
)
|
|||||
Interest expense, net
|
(13,010
|
)
|
|
(136
|
)
|
|
174
|
|
|
—
|
|
|
(12,972
|
)
|
|||||
Intercompany interest, net
|
1,124
|
|
|
(12,137
|
)
|
|
11,013
|
|
|
—
|
|
|
—
|
|
|||||
Equity in earnings (losses) of investments
|
(26,446
|
)
|
|
37,219
|
|
|
—
|
|
|
(10,773
|
)
|
|
—
|
|
|||||
Other income (expense)
|
(196
|
)
|
|
116
|
|
|
(356
|
)
|
|
—
|
|
|
(436
|
)
|
|||||
Income (loss) before income taxes
|
(71,416
|
)
|
|
7,290
|
|
|
7,219
|
|
|
(10,773
|
)
|
|
(67,680
|
)
|
|||||
Income tax expense (benefit)
|
(245
|
)
|
|
(6,711
|
)
|
|
9,674
|
|
|
—
|
|
|
2,718
|
|
|||||
Net income (loss)
|
(71,171
|
)
|
|
14,001
|
|
|
(2,455
|
)
|
|
(10,773
|
)
|
|
(70,398
|
)
|
|||||
Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(773
|
)
|
|
—
|
|
|
(773
|
)
|
|||||
Net income (loss) attributable to ION
|
$
|
(71,171
|
)
|
|
$
|
14,001
|
|
|
$
|
(3,228
|
)
|
|
$
|
(10,773
|
)
|
|
$
|
(71,171
|
)
|
Comprehensive net income (loss)
|
$
|
(72,734
|
)
|
|
$
|
13,953
|
|
|
$
|
(4,797
|
)
|
|
$
|
(8,383
|
)
|
|
$
|
(71,961
|
)
|
Comprehensive income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(773
|
)
|
|
—
|
|
|
(773
|
)
|
|||||
Comprehensive net income (loss) attributable to ION
|
$
|
(72,734
|
)
|
|
$
|
13,953
|
|
|
$
|
(5,570
|
)
|
|
$
|
(8,383
|
)
|
|
$
|
(72,734
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2017
|
||||||||||||||||||
Income Statement
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Total net revenues
|
$
|
—
|
|
|
$
|
148,590
|
|
|
$
|
48,964
|
|
|
$
|
—
|
|
|
$
|
197,554
|
|
Cost of goods sold
|
—
|
|
|
90,754
|
|
|
31,161
|
|
|
—
|
|
|
121,915
|
|
|||||
Gross profit
|
—
|
|
|
57,836
|
|
|
17,803
|
|
|
—
|
|
|
75,639
|
|
|||||
Total operating expenses
|
39,000
|
|
|
28,020
|
|
|
17,318
|
|
|
—
|
|
|
84,338
|
|
|||||
Income (loss) from operations
|
(39,000
|
)
|
|
29,816
|
|
|
485
|
|
|
—
|
|
|
(8,699
|
)
|
|||||
Interest expense, net
|
(16,729
|
)
|
|
(107
|
)
|
|
127
|
|
|
—
|
|
|
(16,709
|
)
|
|||||
Intercompany interest, net
|
1,084
|
|
|
(6,613
|
)
|
|
5,529
|
|
|
—
|
|
|
—
|
|
|||||
Equity in earnings (losses) of investments
|
27,696
|
|
|
67,290
|
|
|
—
|
|
|
(94,986
|
)
|
|
—
|
|
|||||
Other income (expense)
|
(4,610
|
)
|
|
(407
|
)
|
|
1,072
|
|
|
—
|
|
|
(3,945
|
)
|
|||||
Income (loss) before income taxes
|
(31,559
|
)
|
|
89,979
|
|
|
7,213
|
|
|
(94,986
|
)
|
|
(29,353
|
)
|
|||||
Income tax expense (benefit)
|
(1,317
|
)
|
|
(1,427
|
)
|
|
2,768
|
|
|
—
|
|
|
24
|
|
|||||
Net income (loss)
|
(30,242
|
)
|
|
91,406
|
|
|
4,445
|
|
|
(94,986
|
)
|
|
(29,377
|
)
|
|||||
Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(865
|
)
|
|
—
|
|
|
(865
|
)
|
|||||
Net income (loss) attributable to ION
|
$
|
(30,242
|
)
|
|
$
|
91,406
|
|
|
$
|
3,580
|
|
|
$
|
(94,986
|
)
|
|
$
|
(30,242
|
)
|
Comprehensive net income (loss)
|
$
|
(27,373
|
)
|
|
$
|
91,358
|
|
|
$
|
6,550
|
|
|
$
|
(97,043
|
)
|
|
$
|
(26,508
|
)
|
Comprehensive income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(865
|
)
|
|
—
|
|
|
(865
|
)
|
|||||
Comprehensive net income (loss) attributable to ION
|
$
|
(27,373
|
)
|
|
$
|
91,358
|
|
|
$
|
5,685
|
|
|
$
|
(97,043
|
)
|
|
$
|
(27,373
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2016
|
||||||||||||||||||
Income Statement
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Total net revenues
|
$
|
—
|
|
|
$
|
91,465
|
|
|
$
|
81,343
|
|
|
$
|
—
|
|
|
$
|
172,808
|
|
Cost of goods sold
|
—
|
|
|
87,660
|
|
|
49,116
|
|
|
—
|
|
|
136,776
|
|
|||||
Gross profit
|
—
|
|
|
3,805
|
|
|
32,227
|
|
|
—
|
|
|
36,032
|
|
|||||
Total operating expenses
|
31,438
|
|
|
27,279
|
|
|
20,486
|
|
|
—
|
|
|
79,203
|
|
|||||
Income (loss) from operations
|
(31,438
|
)
|
|
(23,474
|
)
|
|
11,741
|
|
|
—
|
|
|
(43,171
|
)
|
|||||
Interest expense, net
|
(18,406
|
)
|
|
(173
|
)
|
|
94
|
|
|
—
|
|
|
(18,485
|
)
|
|||||
Intercompany interest, net
|
978
|
|
|
(4,397
|
)
|
|
3,419
|
|
|
—
|
|
|
—
|
|
|||||
Equity in earnings (losses) of investments
|
(19,756
|
)
|
|
23,368
|
|
|
—
|
|
|
(3,612
|
)
|
|
—
|
|
|||||
Other income (expense)
|
3,528
|
|
|
723
|
|
|
(2,901
|
)
|
|
—
|
|
|
1,350
|
|
|||||
Income (loss) before income taxes
|
(65,094
|
)
|
|
(3,953
|
)
|
|
12,353
|
|
|
(3,612
|
)
|
|
(60,306
|
)
|
|||||
Income tax expense
|
54
|
|
|
1,337
|
|
|
3,030
|
|
|
—
|
|
|
4,421
|
|
|||||
Net income (loss)
|
(65,148
|
)
|
|
(5,290
|
)
|
|
9,323
|
|
|
(3,612
|
)
|
|
(64,727
|
)
|
|||||
Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(421
|
)
|
|
—
|
|
|
(421
|
)
|
|||||
Net income (loss) attributable to ION
|
$
|
(65,148
|
)
|
|
$
|
(5,290
|
)
|
|
$
|
8,902
|
|
|
$
|
(3,612
|
)
|
|
$
|
(65,148
|
)
|
Comprehensive net income (loss)
|
$
|
(72,331
|
)
|
|
$
|
(5,290
|
)
|
|
$
|
1,719
|
|
|
$
|
4,208
|
|
|
$
|
(71,694
|
)
|
Comprehensive income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(421
|
)
|
|
—
|
|
|
(421
|
)
|
|||||
Comprehensive net income (loss) attributable to ION
|
$
|
(72,331
|
)
|
|
$
|
(5,290
|
)
|
|
$
|
1,298
|
|
|
$
|
4,208
|
|
|
$
|
(72,115
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2018
|
||||||||||||||
Statement of Cash Flows
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Total Consolidated
|
||||||||
|
(In thousands)
|
||||||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|||||||
Net cash provided by (used in) operating activities
|
$
|
(37,659
|
)
|
|
$
|
39,407
|
|
|
$
|
5,350
|
|
|
$
|
7,098
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
||||||||
Investment in multi-client data library
|
—
|
|
|
(25,307
|
)
|
|
(2,969
|
)
|
|
(28,276
|
)
|
||||
Purchase of property, plant, equipment and seismic rental equipment
|
(392
|
)
|
|
(959
|
)
|
|
(163
|
)
|
|
(1,514
|
)
|
||||
Net cash used in investing activities
|
(392
|
)
|
|
(26,266
|
)
|
|
(3,132
|
)
|
|
(29,790
|
)
|
||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
||||||||
Repayments under revolving line of credit
|
(10,000
|
)
|
|
—
|
|
|
—
|
|
|
(10,000
|
)
|
||||
Payments on notes payable and long-term debt
|
(30,169
|
)
|
|
(638
|
)
|
|
—
|
|
|
(30,807
|
)
|
||||
Cost associated with issuance of debt
|
(1,247
|
)
|
|
—
|
|
|
—
|
|
|
(1,247
|
)
|
||||
Intercompany lending
|
7,983
|
|
|
(12,522
|
)
|
|
4,539
|
|
|
—
|
|
||||
Proceeds from employee stock purchases and exercise of stock options
|
214
|
|
|
—
|
|
|
—
|
|
|
214
|
|
||||
Net proceeds from issuance of stocks
|
46,999
|
|
|
—
|
|
|
—
|
|
|
46,999
|
|
||||
Dividend payment to noncontrolling interest
|
(200
|
)
|
|
—
|
|
|
—
|
|
|
(200
|
)
|
||||
Other financing activities
|
(1,151
|
)
|
|
—
|
|
|
—
|
|
|
(1,151
|
)
|
||||
Net cash provided by (used in) financing activities
|
12,429
|
|
|
(13,160
|
)
|
|
4,539
|
|
|
3,808
|
|
||||
Effect of change in foreign currency exchange rates on cash, cash equivalents and restricted cash
|
—
|
|
|
—
|
|
|
319
|
|
|
319
|
|
||||
Net increase (decrease) in cash and cash equivalents
|
(25,622
|
)
|
|
(19
|
)
|
|
7,076
|
|
|
(18,565
|
)
|
||||
Cash, cash equivalents and restricted cash at beginning of period
|
39,707
|
|
|
66
|
|
|
12,646
|
|
|
52,419
|
|
||||
Cash, cash equivalents and restricted cash at end of period
|
$
|
14,085
|
|
|
$
|
47
|
|
|
$
|
19,722
|
|
|
$
|
33,854
|
|
|
December 31, 2018
|
||||||||||||||
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Total Consolidated
|
||||||||
|
(In thousands)
|
||||||||||||||
Cash and cash equivalents
|
$
|
13,782
|
|
|
$
|
47
|
|
|
$
|
19,722
|
|
|
$
|
33,551
|
|
Restricted cash included in other long-term assets
|
303
|
|
|
—
|
|
|
—
|
|
|
303
|
|
||||
Total cash, cash equivalents, and restricted cash shown in statements of cash flows
|
$
|
14,085
|
|
|
$
|
47
|
|
|
$
|
19,722
|
|
|
$
|
33,854
|
|
|
Year Ended December 31, 2017
|
||||||||||||||
Statement of Cash Flows
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Total Consolidated
|
||||||||
|
(In thousands)
|
||||||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
||||||||
Net cash provided by (used in) operating activities
|
$
|
(22,315
|
)
|
|
$
|
73,154
|
|
|
$
|
(23,227
|
)
|
|
$
|
27,612
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
||||||||
Investment in multi-client data library
|
—
|
|
|
(23,710
|
)
|
|
—
|
|
|
(23,710
|
)
|
||||
Purchase of property, plant, equipment and seismic rental equipment
|
(165
|
)
|
|
(817
|
)
|
|
(81
|
)
|
|
(1,063
|
)
|
||||
Net cash used in investing activities
|
(165
|
)
|
|
(24,527
|
)
|
|
(81
|
)
|
|
(24,773
|
)
|
||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
||||||||
Payments on notes payable and long-term debt
|
(1,591
|
)
|
|
(3,167
|
)
|
|
(58
|
)
|
|
(4,816
|
)
|
||||
Cost associated with issuance of debt
|
(53
|
)
|
|
—
|
|
|
—
|
|
|
(53
|
)
|
||||
Intercompany lending
|
38,732
|
|
|
(45,609
|
)
|
|
6,877
|
|
|
—
|
|
||||
Proceeds from employee stock purchases and exercise of stock options
|
1,619
|
|
|
—
|
|
|
—
|
|
|
1,619
|
|
||||
Payments to repurchase bonds
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Dividend payment to noncontrolling interest
|
(100
|
)
|
|
—
|
|
|
—
|
|
|
(100
|
)
|
||||
Other financing activities
|
(243
|
)
|
|
—
|
|
|
—
|
|
|
(243
|
)
|
||||
Net cash provided by (used in) financing activities
|
38,364
|
|
|
(48,776
|
)
|
|
6,819
|
|
|
(3,593
|
)
|
||||
Effect of change in foreign currency exchange rates on cash, cash equivalents and restricted cash
|
—
|
|
|
—
|
|
|
(260
|
)
|
|
(260
|
)
|
||||
Net increase (decrease) in cash and cash equivalents
|
15,884
|
|
|
(149
|
)
|
|
(16,749
|
)
|
|
(1,014
|
)
|
||||
Cash, cash equivalents and restricted cash at beginning of period
|
23,823
|
|
|
215
|
|
|
29,395
|
|
|
53,433
|
|
||||
Cash, cash equivalents and restricted cash at end of period
|
$
|
39,707
|
|
|
$
|
66
|
|
|
$
|
12,646
|
|
|
$
|
52,419
|
|
|
December 31, 2017
|
||||||||||||||
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Total Consolidated
|
||||||||
|
(In thousands)
|
||||||||||||||
Cash and cash equivalents
|
$
|
39,344
|
|
|
$
|
66
|
|
|
$
|
12,646
|
|
|
$
|
52,056
|
|
Restricted cash included in prepaid expenses and other current assets
|
60
|
|
|
—
|
|
|
—
|
|
|
60
|
|
||||
Restricted cash included in other long-term assets
|
303
|
|
|
—
|
|
|
—
|
|
|
303
|
|
||||
Total cash, cash equivalents, and restricted cash shown in statements of cash flows
|
$
|
39,707
|
|
|
$
|
66
|
|
|
$
|
12,646
|
|
|
$
|
52,419
|
|
|
Year Ended December 31, 2016
|
||||||||||||||
Statement of Cash Flows
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Total Consolidated
|
||||||||
|
(In thousands)
|
||||||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
||||||||
Net cash provided by (used in) operating activities
|
$
|
(30,732
|
)
|
|
$
|
53,107
|
|
|
$
|
(21,382
|
)
|
|
$
|
993
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
||||||||
Investment in multi-client data library
|
—
|
|
|
(14,884
|
)
|
|
—
|
|
|
(14,884
|
)
|
||||
Purchase of property, plant and equipment
|
(73
|
)
|
|
(313
|
)
|
|
(1,072
|
)
|
|
(1,458
|
)
|
||||
Proceeds from sale of a cost-method investment
|
2,698
|
|
|
—
|
|
|
—
|
|
|
2,698
|
|
||||
Net cash provided by (used in) investing activities
|
2,625
|
|
|
(15,197
|
)
|
|
(1,072
|
)
|
|
(13,644
|
)
|
||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
||||||||
Payments under revolving line of credit
|
(5,000
|
)
|
|
—
|
|
|
—
|
|
|
(5,000
|
)
|
||||
Borrowings under revolving line of credit
|
15,000
|
|
|
—
|
|
|
—
|
|
|
15,000
|
|
||||
Payments on notes payable and long-term debt
|
(17,070
|
)
|
|
(6,316
|
)
|
|
(248
|
)
|
|
(23,634
|
)
|
||||
Cost associated with issuance of debt
|
(6,744
|
)
|
|
—
|
|
|
—
|
|
|
(6,744
|
)
|
||||
Repurchase of common stock
|
(964
|
)
|
|
—
|
|
|
—
|
|
|
(964
|
)
|
||||
Intercompany lending
|
31,867
|
|
|
(34,771
|
)
|
|
2,904
|
|
|
—
|
|
||||
Other financing activities
|
(252
|
)
|
|
—
|
|
|
—
|
|
|
(252
|
)
|
||||
Net cash provided by (used in) financing activities
|
16,837
|
|
|
(41,087
|
)
|
|
2,656
|
|
|
(21,594
|
)
|
||||
Effect of change in foreign currency exchange rates on cash, cash equivalents and restricted cash
|
—
|
|
|
—
|
|
|
1,386
|
|
|
1,386
|
|
||||
Net decrease in cash and cash equivalents
|
(11,270
|
)
|
|
(3,177
|
)
|
|
(18,412
|
)
|
|
(32,859
|
)
|
||||
Cash, cash equivalents and restricted cash at beginning of period
|
35,093
|
|
|
3,392
|
|
|
47,807
|
|
|
86,292
|
|
||||
Cash, cash equivalents and restricted cash at end of period
|
$
|
23,823
|
|
|
$
|
215
|
|
|
$
|
29,395
|
|
|
$
|
53,433
|
|
|
December 31, 2016
|
||||||||||||||
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Total Consolidated
|
||||||||
|
(In thousands)
|
||||||||||||||
Cash and cash equivalents
|
$
|
23,042
|
|
|
$
|
215
|
|
|
$
|
29,395
|
|
|
$
|
52,652
|
|
Restricted cash included in prepaid expenses and other current assets
|
260
|
|
|
—
|
|
|
—
|
|
|
260
|
|
||||
Restricted cash included in other long-term assets
|
521
|
|
|
—
|
|
|
—
|
|
|
521
|
|
||||
Total cash, cash equivalents, and restricted cash shown in statements of cash flows
|
$
|
23,823
|
|
|
$
|
215
|
|
|
$
|
29,395
|
|
|
$
|
53,433
|
|