|
þ
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
22-2286646
|
(State or Other Jurisdiction of Incorporation or Organization)
|
|
(I.R.S. Employer Identification No.)
|
Title of Each Class
|
Trading symbol(s)
|
Name of Each Exchange on Which Registered
|
Common Stock, $0.01 par value
|
IO
|
New York Stock Exchange
|
Large accelerated filer
|
|
o
|
|
Accelerated filer
|
x
|
|
|
|
|
|
|
Non-accelerated filer
|
|
o
|
|
Smaller reporting company
|
o
|
|
|
|
|
|
|
|
|
|
|
Emerging growth company
|
o
|
Document
|
|
Parts Into Which Incorporated
|
Portions of the registrant’s definitive Proxy Statement for its Annual Meeting of Stockholders scheduled to be held on May 13, 2020, to be filed pursuant to Regulation 14A
|
|
Part III
|
|
|
Page
|
|
|
|
|
PART I
|
|
Item 1.
|
Business
|
|
Item 1A.
|
Risk Factors
|
|
Item 1B.
|
Unresolved Staff Comments
|
|
Item 2.
|
Properties
|
|
Item 3.
|
Legal Proceedings
|
|
Item 4.
|
Mine Safety Disclosures
|
|
|
|
|
|
PART II
|
|
Item 5.
|
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
|
|
Item 6.
|
Selected Financial Data
|
|
Item 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
Item 7A.
|
Quantitative and Qualitative Disclosures about Market Risk
|
|
Item 8.
|
Financial Statements and Supplementary Data
|
|
Item 9.
|
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
|
|
Item 9A.
|
Controls and Procedures
|
|
Item 9B.
|
Other Information
|
|
|
|
|
|
PART III
|
|
Item 10.
|
Directors, Executive Officers and Corporate Governance
|
|
Item 11.
|
Executive Compensation
|
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|
|
Item 13.
|
Certain Relationships and Related Transactions, and Director Independence
|
|
Item 14.
|
Principal Accounting Fees and Services
|
|
|
|
|
|
PART IV
|
|
Item 15.
|
Exhibits and Financial Statement Schedules
|
|
Signatures
|
||
Index to Consolidated Financial Statements
|
•
|
Leverage our technologies to create value through data capture, analysis and optimization to enhance companies’ critical decision-making abilities and returns. 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. As a result, decision-making is shifting from what was historically an art to a science. ION offerings are focused on improving E&P decision-making and optimizing offshore operations.
|
•
|
Expand our E&P Technology & Services business, focusing on delivering value closer to the reservoir. 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 2D programs, we entered the 3D multi-client market in 2014 by acquiring and processing our first survey offshore Ireland. Since then, we have expanded our 3D 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 Full Waveform Inversion (“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 shifting to more reservoir-focused E&P offerings will increase earnings and position our company better for E&P cycles.
|
•
|
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.
|
•
|
Continue investing in advanced software and equipment technology to provide next generation services and products. Our industry is competitive and continually evolving, so we intend to continue investing in the development of new technologies to stay on the cutting-edge of innovation. A key element of our business strategy has been to understand the challenges faced in survey planning, data acquisition, processing, and interpretation and offshore operations. We will continue to develop and offer technology and services that enable us to work with clients to solve their unique challenges around the world. In particular, we intend to focus on the development of our 4Sea next generation ocean bottom seismic (“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 2019, our total investment in research and development and engineering was equal to approximately 11% of our total consolidated net revenues for the year.
|
•
|
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.
|
•
|
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.
|
•
|
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.
|
•
|
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.
|
•
|
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”). Whereas almost all of our revenues in the early 2000s were derived principally from seismic service providers, in 2019, E&P companies accounted for approximately 73% of our total consolidated net revenues.
|
•
|
any additional damages or adverse rulings in the WesternGeco litigation and future potential adverse effects on our financial results and liquidity;
|
•
|
future levels of capital expenditures of our customers for seismic activities;
|
•
|
future oil and gas commodity prices;
|
•
|
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;
|
•
|
future cash needs and availability of cash to fund our operations and pay our obligations;
|
•
|
the effects of current and future unrest in the Middle East, North Africa and other regions;
|
•
|
the timing of anticipated revenues and the recognition of those revenues for financial accounting purposes;
|
•
|
the effects of ongoing and future industry consolidation;
|
•
|
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;
|
•
|
future levels of our capital expenditures;
|
•
|
future government laws or regulations pertaining to the oil and gas industry, including trade restrictions, embargoes and sanctions imposed by the U.S. government;
|
•
|
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.
|
•
|
expected net revenues, income from operations and net income;
|
•
|
expected gross margins for our services and products;
|
•
|
future seismic industry fundamentals, including future demand for seismic services and equipment;
|
•
|
future benefits to our customers to be derived from new services and products;
|
•
|
future benefits to be derived from our investments in technologies, joint ventures and acquired companies;
|
•
|
future growth rates for our services and products;
|
•
|
the degree and rate of future market acceptance of our new services and products;
|
•
|
expectations regarding E&P companies and seismic contractor end-users purchasing our more technologically-advanced services and products;
|
•
|
anticipated timing and success of commercialization and capabilities of services and products under development and start-up costs associated with their development;
|
•
|
future opportunities for new products and projected research and development expenses;
|
•
|
expected continued compliance with our debt financial covenants;
|
•
|
expectations regarding realization of deferred tax assets;
|
•
|
expectations regarding the impact of the U.S. Tax Cuts and Jobs Act;
|
•
|
anticipated results with respect to certain estimates we make for financial accounting purposes; and
|
•
|
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.
|
•
|
the supply of and demand for oil and gas;
|
•
|
the level of prices, and expectations about future prices, of oil and gas;
|
•
|
the cost of exploring for, developing, producing and delivering oil and gas;
|
•
|
the expected rates of decline for current production;
|
•
|
the discovery rates of new oil and gas reserves;
|
•
|
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;
|
•
|
domestic and worldwide economic conditions;
|
•
|
public health crises, such as the coronavirus outbreak at the beginning of 2020;
|
•
|
changes in government leadership;
|
•
|
political instability in oil and gas producing countries;
|
•
|
technical advances affecting energy consumption;
|
•
|
government policies regarding the exploration, production and development of oil and gas reserves;
|
•
|
the ability of oil and gas producers to raise equity capital and debt financing;
|
•
|
merger and divestiture activity among oil and gas companies and seismic contractors; and
|
•
|
compliance by members of the OPEC and non-OPEC members, such as Russia, with agreements to cut oil production.
|
•
|
we may have difficulty satisfying our obligations with respect to our outstanding debt;
|
•
|
we may have difficulty obtaining financing in the future for working capital, capital expenditures, acquisitions or other purposes;
|
•
|
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;
|
•
|
our vulnerability to general economic downturns and adverse industry conditions could increase;
|
•
|
our flexibility in planning for, or reacting to, changes in our business and in our industry in general could be limited;
|
•
|
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;
|
•
|
our customers may react adversely to our significant debt level and seek or develop alternative licensors or suppliers;
|
•
|
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
|
•
|
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.
|
•
|
incur additional indebtedness;
|
•
|
create liens;
|
•
|
pay dividends and make other distributions in respect of our capital stock;
|
•
|
redeem our capital stock;
|
•
|
make investments or certain other restricted payments;
|
•
|
sell certain kinds of assets;
|
•
|
enter into transactions with affiliates; and
|
•
|
effect mergers or consolidations.
|
•
|
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
|
•
|
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.
|
•
|
future competition from more established companies entering the market;
|
•
|
technology obsolescence;
|
•
|
dependence upon continued growth of the market for seismic data processing;
|
•
|
the rate of change in the markets for these segments’ technology and services;
|
•
|
further consolidation of the participants within this market;
|
•
|
research and development efforts not proving sufficient to keep up with changing market demands;
|
•
|
dependence on third-party software for inclusion in these segments’ services and products;
|
•
|
misappropriation of these segments’ technology by other companies;
|
•
|
alleged or actual infringement of intellectual property rights that could result in substantial additional costs;
|
•
|
difficulties inherent in forecasting sales for newly developed technologies or advancements in technologies;
|
•
|
recruiting, training and retaining technically skilled, experienced personnel that could increase the costs for these segments, or limit their growth; and
|
•
|
the ability to maintain traditional margins for certain of their technology or services.
|
•
|
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.
|
•
|
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.
|
•
|
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.
|
•
|
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.
|
•
|
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 customers. In the event that a client refuses or is unable to pay its commitment, we could incur a substantial loss on that project.
|
•
|
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.
|
•
|
disruption of E&P activities;
|
•
|
restriction on the movement and exchange of funds;
|
•
|
inhibition of our ability to collect advances and receivables;
|
•
|
enactment of additional or stricter U.S. government or international sanctions;
|
•
|
limitation of our access to markets for periods of time;
|
•
|
expropriation and nationalization of assets of our company or those of our customers;
|
•
|
political and economic instability, which may include armed conflict and civil disturbance;
|
•
|
currency fluctuations, devaluations and conversion restrictions;
|
•
|
confiscatory taxation or other adverse tax policies; and
|
•
|
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.
|
•
|
the inherent lumpiness and volatility of our customers’ spending cycles;
|
•
|
operating results that vary from the expectations of securities analysts and investors;
|
•
|
factors influencing the levels of global oil and natural gas exploration and exploitation activities, such as the decline in crude oil prices and changes in oil and gas supply and demand;
|
•
|
the operating and securities price performance of companies that investors or analysts consider comparable to us;
|
•
|
actions by rating agencies related to the Notes; and
|
•
|
announcements of strategic developments, acquisitions and other material events by us or our competitors.
|
•
|
authorizing the issuance of “blank check” preferred stock without any need for action by stockholders;
|
•
|
providing for a classified board of directors with staggered terms;
|
•
|
requiring supermajority stockholder voting to effect certain amendments to our certificate of incorporation and bylaws;
|
•
|
eliminating the ability of stockholders to call special meetings of stockholders;
|
•
|
prohibiting stockholder action by written consent; and
|
•
|
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.
|
Operating Facilities
|
Square
Footage |
|
Segment
|
|
Houston, Texas
|
210,000
|
|
|
Global Headquarters and E&P Technology & Services
|
Harahan, Louisiana
|
144,000
|
|
|
Devices group within Operations Optimization
|
Chertsey, England
|
18,000
|
|
|
E&P Technology & Services
|
Edinburgh, Scotland
|
16,000
|
|
|
Optimization Software & Services group within Operations Optimization
|
|
388,000
|
|
|
|
Period
|
|
(a)
Total Number of
Shares Acquired
|
|
(b)
Average Price Paid Per Share |
|
(c)
Total Number of Shares Purchased as Part of Publicly Announced Plans or Program |
|
(d)
Maximum Number (or Approximate Dollar Value) of Shares That May Yet Be Purchased Under the Plans or Program |
|||
October 1, 2019 to October 31, 2019
|
|
—
|
|
|
$
|
—
|
|
|
Not applicable
|
|
Not applicable
|
November 1, 2019 to November 30, 2019
|
|
—
|
|
|
$
|
—
|
|
|
Not applicable
|
|
Not applicable
|
December 1, 2019 to December 31, 2019
|
|
4,026
|
|
|
$
|
8.43
|
|
|
Not applicable
|
|
Not applicable
|
Total
|
|
4,026
|
|
|
$
|
8.43
|
|
|
|
|
|
|
Years Ended December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Cost of sales:
|
|
|
|
|
|
|
|
|
|
||||||||||
Write-down of multi-client data library
|
$
|
(9,072
|
)
|
|
$
|
—
|
|
|
$
|
(2,304
|
)
|
|
$
|
—
|
|
|
$
|
(399
|
)
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Impairment of long-lived assets
|
$
|
—
|
|
|
$
|
(36,553
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Stock appreciation right awards and related expense
|
$
|
(2,910
|
)
|
|
$
|
(2,105
|
)
|
|
$
|
(6,141
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Severance expense
|
$
|
(2,810
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
||||||||||
Reversal of (accrual for) loss contingency related to legal proceedings
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(5,000
|
)
|
|
$
|
1,168
|
|
|
$
|
101,978
|
|
Recovery of INOVA bad debts
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
844
|
|
|
$
|
3,983
|
|
|
$
|
—
|
|
Loss on bond exchange
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(2,182
|
)
|
|
$
|
—
|
|
|
|
Years Ended December 31,
|
||||||||||||||||||
|
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
|
|
(In thousands, except for per share data)
|
||||||||||||||||||
Statement of Operations Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net revenues
|
|
$
|
174,679
|
|
|
$
|
180,045
|
|
|
$
|
197,554
|
|
|
$
|
172,808
|
|
|
$
|
221,513
|
|
Gross profit
|
|
60,022
|
|
|
59,620
|
|
|
75,639
|
|
|
36,032
|
|
|
8,003
|
|
|||||
Loss from operations
|
|
(24,459
|
)
|
|
(54,272
|
)
|
|
(8,699
|
)
|
|
(43,171
|
)
|
|
(100,632
|
)
|
|||||
Net loss applicable to common shares
|
|
(48,199
|
)
|
|
(71,171
|
)
|
|
(30,242
|
)
|
|
(65,148
|
)
|
|
(25,122
|
)
|
|||||
Net loss per basic share
|
|
$
|
(3.41
|
)
|
|
$
|
(5.20
|
)
|
|
$
|
(2.55
|
)
|
|
$
|
(5.71
|
)
|
|
$
|
(2.29
|
)
|
Net loss per diluted share
|
|
$
|
(3.41
|
)
|
|
$
|
(5.20
|
)
|
|
$
|
(2.55
|
)
|
|
$
|
(5.71
|
)
|
|
$
|
(2.29
|
)
|
Weighted average number of common shares outstanding
|
|
14,131
|
|
|
13,692
|
|
|
11,876
|
|
|
11,400
|
|
|
10,957
|
|
|||||
Weighted average number of diluted shares outstanding
|
|
14,131
|
|
|
13,692
|
|
|
11,876
|
|
|
11,400
|
|
|
10,957
|
|
|||||
Balance Sheet Data (end of year):
|
|
|
|
|
|
|
|
|
||||||||||||
Working capital
|
|
$
|
(23,561
|
)
|
(a)
|
$
|
7,891
|
|
|
$
|
(8,628
|
)
|
(b)
|
$
|
16,555
|
|
|
$
|
93,160
|
|
Total assets
|
|
233,194
|
|
|
292,552
|
|
|
301,069
|
|
|
313,216
|
|
|
435,088
|
|
|||||
Long-term debt (c)
|
|
121,459
|
|
|
121,741
|
|
|
156,744
|
|
|
158,790
|
|
|
182,992
|
|
|||||
Total (deficit) equity
|
|
(34,632
|
)
|
|
7,824
|
|
|
30,806
|
|
|
53,398
|
|
|
112,040
|
|
|||||
Other Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Investment in multi-client data library
|
|
$
|
28,804
|
|
|
$
|
28,276
|
|
|
$
|
23,710
|
|
|
$
|
14,884
|
|
|
$
|
45,558
|
|
Capital expenditures
|
|
2,411
|
|
|
1,514
|
|
|
1,063
|
|
|
1,488
|
|
|
19,241
|
|
|||||
Depreciation and amortization (other than multi-client data library)
|
|
3,657
|
|
|
8,763
|
|
|
16,592
|
|
|
21,975
|
|
|
26,527
|
|
|||||
Amortization of multi-client data library
|
|
39,541
|
|
|
48,988
|
|
|
47,102
|
|
|
33,335
|
|
|
35,784
|
|
(a)
|
Working capital was impacted by project delays.
|
(b)
|
Working capital at December 31, 2017 is negative due to $28.5 million of Third Lien Notes (redeemed March 26, 2018) being reclassified from long-term to current.
|
(c)
|
Includes current maturities of long-term debt.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(In thousands)
|
||||||||||
Net revenues:
|
|
|
|
|
|
||||||
E&P Technology & Services:
|
|
|
|
|
|
||||||
New Venture (a)
|
$
|
31,188
|
|
|
$
|
69,685
|
|
|
$
|
100,824
|
|
Data Library
|
71,847
|
|
|
47,095
|
|
|
40,016
|
|
|||
Total multi-client revenues (b)
|
103,035
|
|
|
116,780
|
|
|
140,840
|
|
|||
Imaging Services
|
22,543
|
|
|
19,740
|
|
|
16,409
|
|
|||
Total
|
$
|
125,578
|
|
|
$
|
136,520
|
|
|
$
|
157,249
|
|
Operations Optimization:
|
|
|
|
|
|
||||||
Optimization Software & Services
|
$
|
23,140
|
|
|
$
|
21,129
|
|
|
$
|
16,695
|
|
Devices
|
25,961
|
|
|
22,396
|
|
|
23,610
|
|
|||
Total
|
$
|
49,101
|
|
|
$
|
43,525
|
|
|
$
|
40,305
|
|
Total
|
$
|
174,679
|
|
|
$
|
180,045
|
|
|
$
|
197,554
|
|
(a)
|
Includes net revenues generated by our E&P Advisors group.
|
(b)
|
Excluding item (a) above, this represents net revenues generated our Ventures group.
|
|
Year Ended December 31, 2019
|
|
Year Ended December 31, 2018
|
|
Year Ended December 31, 2017
|
||||||||||||||||||||||||||||||
|
As Reported
|
|
Special Items
|
|
As Adjusted
|
|
As Reported
|
|
Special Items
|
|
As Adjusted
|
|
As Reported
|
|
Special Items
|
|
As Adjusted
|
||||||||||||||||||
|
(In thousands, except per share data)
|
||||||||||||||||||||||||||||||||||
Gross profit (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
E&P Technology & Services
|
$
|
35,699
|
|
|
$
|
9,072
|
|
(b)
|
$
|
44,771
|
|
|
$
|
43,369
|
|
|
$
|
—
|
|
|
$
|
43,369
|
|
|
$
|
65,196
|
|
|
$
|
—
|
|
|
$
|
65,196
|
|
Operations Optimization
|
24,323
|
|
|
—
|
|
|
24,323
|
|
|
22,293
|
|
|
—
|
|
|
22,293
|
|
|
20,076
|
|
|
—
|
|
|
20,076
|
|
|||||||||
Segment gross profit
|
60,022
|
|
|
9,072
|
|
|
69,094
|
|
|
65,662
|
|
|
—
|
|
|
65,662
|
|
|
85,272
|
|
|
—
|
|
|
85,272
|
|
|||||||||
Other (a)
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,042
|
)
|
|
—
|
|
|
(6,042
|
)
|
|
(9,633
|
)
|
|
—
|
|
|
(9,633
|
)
|
|||||||||
Total
|
$
|
60,022
|
|
|
$
|
9,072
|
|
|
$
|
69,094
|
|
|
$
|
59,620
|
|
|
$
|
—
|
|
|
$
|
59,620
|
|
|
$
|
75,639
|
|
|
$
|
—
|
|
|
$
|
75,639
|
|
Gross margin:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
E&P Technology & Services
|
28
|
%
|
|
8
|
%
|
|
36
|
%
|
|
32
|
%
|
|
—
|
%
|
|
32
|
%
|
|
41
|
%
|
|
—
|
%
|
|
41
|
%
|
|||||||||
Operations Optimization
|
50
|
%
|
|
—
|
%
|
|
50
|
%
|
|
51
|
%
|
|
—
|
%
|
|
51
|
%
|
|
50
|
%
|
|
—
|
%
|
|
50
|
%
|
|||||||||
Segment gross margin
|
34
|
%
|
|
6
|
%
|
|
40
|
%
|
|
36
|
%
|
|
—
|
%
|
|
36
|
%
|
|
43
|
%
|
|
—
|
%
|
|
42
|
%
|
|||||||||
Other
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
(3
|
)%
|
|
—
|
%
|
|
(3
|
)%
|
|
(5
|
)%
|
|
—
|
%
|
|
(5
|
)%
|
|||||||||
Total
|
34
|
%
|
|
6
|
%
|
|
40
|
%
|
|
33
|
%
|
|
—
|
%
|
|
33
|
%
|
|
38
|
%
|
|
—
|
%
|
|
38
|
%
|
|||||||||
Income (loss) from operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
E&P Technology & Services
|
$
|
8,833
|
|
|
$
|
9,072
|
|
(b)
|
$
|
17,905
|
|
|
$
|
21,758
|
|
|
$
|
—
|
|
|
$
|
21,758
|
|
|
$
|
42,505
|
|
|
$
|
—
|
|
|
$
|
42,505
|
|
Operations Optimization
|
8,189
|
|
|
—
|
|
|
8,189
|
|
|
7,295
|
|
|
—
|
|
|
7,295
|
|
|
8,022
|
|
|
—
|
|
|
8,022
|
|
|||||||||
Support and other
|
(41,481
|
)
|
(e)
|
5,720
|
|
(c)
|
(35,761
|
)
|
|
(83,325
|
)
|
(e)
|
38,658
|
|
(d)
|
(44,667
|
)
|
|
(59,226
|
)
|
(e)
|
6,141
|
|
(f)
|
(53,085
|
)
|
|||||||||
Total
|
$
|
(24,459
|
)
|
|
$
|
14,792
|
|
|
$
|
(9,667
|
)
|
|
$
|
(54,272
|
)
|
|
$
|
38,658
|
|
|
$
|
(15,614
|
)
|
|
$
|
(8,699
|
)
|
|
$
|
6,141
|
|
|
$
|
(2,558
|
)
|
Operating margin:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
E&P Technology & Services
|
7
|
%
|
|
7
|
%
|
|
14
|
%
|
|
16
|
%
|
|
—
|
%
|
|
16
|
%
|
|
27
|
%
|
|
—
|
%
|
|
27
|
%
|
|||||||||
Operations Optimization
|
17
|
%
|
|
—
|
%
|
|
17
|
%
|
|
17
|
%
|
|
—
|
%
|
|
17
|
%
|
|
20
|
%
|
|
—
|
%
|
|
20
|
%
|
|||||||||
Support and other
|
(24
|
)%
|
|
4
|
%
|
|
(20
|
)%
|
|
(46
|
)%
|
|
21
|
%
|
|
(25
|
)%
|
|
(30
|
)%
|
|
4
|
%
|
|
(26
|
)%
|
|||||||||
Total
|
(14
|
)%
|
|
8
|
%
|
|
(6
|
)%
|
|
(30
|
)%
|
|
21
|
%
|
|
(9
|
)%
|
|
(4
|
)%
|
|
3
|
%
|
|
(1
|
)%
|
|||||||||
Net income (loss) applicable to common shares
|
$
|
(48,199
|
)
|
|
$
|
14,347
|
|
(h)
|
$
|
(33,852
|
)
|
|
$
|
(71,171
|
)
|
|
$
|
38,658
|
|
|
$
|
(32,513
|
)
|
|
$
|
(30,242
|
)
|
|
$
|
11,141
|
|
(g)
|
$
|
(19,101
|
)
|
Diluted net income (loss) per common share
|
$
|
(3.41
|
)
|
|
$
|
1.01
|
|
|
$
|
(2.40
|
)
|
|
$
|
(5.20
|
)
|
|
$
|
2.83
|
|
|
$
|
(2.37
|
)
|
|
$
|
(2.55
|
)
|
|
$
|
0.94
|
|
|
$
|
(1.61
|
)
|
(a)
|
Relates to the gross loss of previously reported Ocean Bottom Integrated Technologies segment.
|
|||
|
|
|||
(b)
|
Relates to the write-down of our multi-client data library.
|
|||
|
|
|||
(c)
|
Represents severance expense of $2.8 million and stock appreciation right awards expense of $2.9 million.
|
|||
|
|
|||
(d)
|
Represents a write-down of the cable-based ocean bottom acquisition technologies of $36.6 million and stock appreciation rights awards and related expenses for 2018 of $2.1 million.
|
|||
|
|
|
|
|
(e)
|
Includes loss from operations of previously reported Ocean Bottom Integrated Technologies segment of $1.7 million, $11.1 million and $16.3 million for 2019, 2018 and 2017, respectively, which includes item (a) above, operating expenses of $1.7 million, $5.1 million and $6.7 million for 2019, 2018 and 2017 and impairment charge of $36.6 million for 2018. Remaining balance primarily relates to operating expenses.
|
|||
|
|
|
|
|
(f)
|
Represents stock appreciation right awards and related expenses for 2017.
|
|||
|
|
|
|
|
(g)
|
In addition to item (f), also impacting net loss applicable to common shares was a loss contingency accrual of $5.0 million related to legal proceedings.
|
|||
|
|
|
|
|
(h)
|
In addition to item (b) and (c), also impacting net loss applicable to common shares was the tax impact of $0.4 million related to the write-down of our multi-client data library.
|
|
Year Ended December 31, 2019
|
|
Year Ended December 31, 2018
|
||||||||||||||||||||
|
As Reported
|
|
Special Items
|
|
As Adjusted
|
|
As Reported
|
|
Special Items
|
|
As Adjusted
|
||||||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Research, development and engineering
|
$
|
19,025
|
|
|
$
|
—
|
|
|
$
|
19,025
|
|
|
$
|
18,182
|
|
|
$
|
—
|
|
|
$
|
18,182
|
|
Marketing and sales
|
23,207
|
|
|
—
|
|
|
23,207
|
|
|
21,793
|
|
|
—
|
|
|
21,793
|
|
||||||
General, administrative and other operating expenses
|
42,249
|
|
|
(5,720
|
)
|
(a)
|
36,529
|
|
|
37,364
|
|
|
(2,105
|
)
|
(b)
|
35,259
|
|
||||||
Impairment of long-lived assets
|
—
|
|
|
—
|
|
|
—
|
|
|
36,553
|
|
|
(36,553
|
)
|
(c)
|
—
|
|
||||||
Total operating expenses
|
$
|
84,481
|
|
|
$
|
(5,720
|
)
|
|
$
|
78,761
|
|
|
$
|
113,892
|
|
|
$
|
(38,658
|
)
|
|
$
|
75,234
|
|
(a)
|
Represents severance expense of $2.8 million and stock appreciation right awards expense of $2.9 million.
|
(b)
|
Represents stock appreciation rights awards and related expenses for 2018.
|
(c)
|
Represents a write-down of the cable-based ocean bottom acquisition technologies.
|
|
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 stock appreciation rights awards and related expenses for 2018 and 2017.
|
(b)
|
Represents a write-down of the cable-based ocean bottom acquisition technologies.
|
|
Years Ended December 31,
|
||||||
|
2018
|
|
2017
|
||||
Reduction of (accrual for) loss contingency related to legal proceedings (Footnote 8)
|
$
|
—
|
|
|
$
|
(5,000
|
)
|
Recovery of INOVA bad debts
|
—
|
|
|
844
|
|
||
Other income (expense)
|
(436
|
)
|
|
211
|
|
||
Total other expense
|
$
|
(436
|
)
|
|
$
|
(3,945
|
)
|
•
|
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 $10.0 million (from $40.0 million to $50.0 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 $15.0 million for the multi-client data library component);
|
•
|
include the eligible billed receivables of the Mexican Subsidiary up to a maximum of $5.0 million in the borrowing base calculation and joins the Mexican Subsidiary as a borrower thereunder (with a maximum exposure of $5.0 million) and require the equity and assets of the Mexican Subsidiary to be pledged to secure obligations under the 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 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
|
|
105.50%
|
2020
|
|
103.50%
|
2021
|
|
100.00%
|
Contractual Obligations
|
Total
|
|
Less Than 1 Year
|
|
1-3 Years
|
|
4-5 Years
|
|
More Than 5 Years
|
||||||||||
Long-term and short-term debt
|
$
|
121,541
|
|
|
$
|
972
|
|
|
$
|
120,569
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest on long-term debt obligations
|
23,517
|
|
|
11,626
|
|
|
11,891
|
|
|
—
|
|
|
—
|
|
|||||
Equipment finance leases
|
2,010
|
|
|
1,254
|
|
|
756
|
|
|
—
|
|
|
—
|
|
|||||
Operating leases
|
52,726
|
|
|
12,708
|
|
|
30,887
|
|
|
9,128
|
|
|
3
|
|
|||||
Purchase obligations
|
5,814
|
|
|
5,814
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
205,608
|
|
|
$
|
32,374
|
|
|
$
|
164,103
|
|
|
$
|
9,128
|
|
|
$
|
3
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Latin America
|
$
|
60,684
|
|
|
$
|
68,871
|
|
|
$
|
68,241
|
|
North America
|
46,684
|
|
|
44,474
|
|
|
48,120
|
|
|||
Europe
|
30,722
|
|
|
31,077
|
|
|
44,930
|
|
|||
Asia Pacific
|
13,242
|
|
|
17,817
|
|
|
18,896
|
|
|||
Africa
|
10,083
|
|
|
10,837
|
|
|
6,837
|
|
|||
Middle East
|
7,347
|
|
|
5,526
|
|
|
2,308
|
|
|||
Other
|
5,917
|
|
|
1,443
|
|
|
8,222
|
|
|||
Total
|
$
|
174,679
|
|
|
$
|
180,045
|
|
|
$
|
197,554
|
|
(i)
|
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our company;
|
(ii)
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of our company are being made only in accordance with authorizations of our management and directors; and
|
(iii)
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
|
|
3.1
|
|
—
|
|
|
3.2
|
|
—
|
|
|
4.1
|
|
—
|
|
|
4.2
|
|
—
|
|
|
4.3
|
|
—
|
|
|
4.4
|
|
—
|
|
|
*4.5
|
|
—
|
|
|
**10.1
|
|
—
|
|
|
**10.2
|
|
—
|
|
|
**10.3
|
|
—
|
|
|
**10.4
|
|
—
|
|
|
**10.5
|
|
—
|
|
10.6
|
|
—
|
|
|
10.7
|
|
—
|
|
|
10.8
|
|
—
|
|
|
10.9
|
|
—
|
|
|
**10.10
|
|
—
|
|
|
10.11
|
|
—
|
|
|
**10.12
|
|
—
|
|
|
**10.13
|
|
—
|
|
|
10.14
|
|
—
|
|
|
10.15
|
|
—
|
|
|
10.16
|
|
—
|
|
|
**10.17
|
|
—
|
|
|
**10.18
|
|
—
|
|
|
**10.19
|
|
—
|
|
|
**10.20
|
|
—
|
|
|
**10.21
|
|
—
|
|
|
10.22
|
|
—
|
|
|
10.23
|
|
—
|
|
|
**10.24
|
|
—
|
(b)
|
Exhibits required by Item 601 of Regulation S-K.
|
|
Reference is made to subparagraph (a) (3) of this Item 15, which is incorporated herein by reference.
|
|
|
(c)
|
Not applicable.
|
|
|
|
ION GEOPHYSICAL CORPORATION
|
||
|
|
|
|
|
By
|
|
/s/ Christopher Usher
|
|
|
|
Christopher Usher
|
|
|
|
President and Chief Executive Officer
|
Name
|
|
Capacities
|
|
Date
|
|
|
|
||
/s/ CHRISTOPHER USHER
|
|
President, Chief Executive Officer and Director
(Principal Executive Officer) |
|
February 6, 2020
|
Christopher Usher
|
|
|
|
|
|
|
|
||
/s/ MIKE MORRISON
|
|
Executive Vice President and Interim Chief
Financial Officer (Principal Financial Officer) |
|
February 6, 2020
|
Mike Morrison
|
|
|
|
|
|
|
|
||
/s/ SCOTT SCHWAUSCH
|
|
Vice President and Corporate Controller
(Principal Accounting Officer) |
|
February 6, 2020
|
Scott Schwausch
|
|
|
|
|
|
|
|
||
/s/ JAMES M. LAPEYRE, JR.
|
|
Chairman of the Board of Directors and Director
|
|
February 6, 2020
|
James M. Lapeyre, Jr.
|
|
|
|
|
|
|
|
||
/s/ DAVID H. BARR
|
|
Director
|
|
February 6, 2020
|
David H. Barr
|
|
|
|
|
|
|
|
||
|
|
Director
|
|
February 6, 2020
|
Zheng HuaSheng
|
|
|
|
Name
|
|
Capacities
|
|
Date
|
|
|
|
||
/s/ TINA WININGER
|
|
Director
|
|
February 6, 2020
|
Tina Wininger
|
|
|
|
|
|
|
|
||
/s/ MICHAEL MCGOVERN
|
|
Director
|
|
February 6, 2020
|
Michael McGovern
|
|
|
|
|
|
|
|
||
/s/ S. JAMES NELSON, JR.
|
|
Director
|
|
February 6, 2020
|
S. James Nelson, Jr.
|
|
|
|
|
|
|
|
||
/s/ JOHN N. SEITZ
|
|
Director
|
|
February 6, 2020
|
John N. Seitz
|
|
|
|
|
|
|
|
|
Page
|
ION Geophysical Corporation and Subsidiaries:
|
|
|
Report of Independent Registered Public Accounting Firm
|
|
F-2
|
Consolidated Balance Sheets — December 31, 2019 and 2018
|
|
F-3
|
Consolidated Statements of Operations — Years ended December 31, 2019, 2018 and 2017
|
|
F-4
|
Consolidated Statements of Comprehensive Loss — Years ended December 31, 2019, 2018 and 2017
|
|
F-5
|
Consolidated Statements of Cash Flows — Years ended December 31, 2019, 2018 and 2017
|
|
F-6
|
Consolidated Statements of Stockholders’ (Deficit) Equity — Years ended December 31, 2019, 2018 and 2017
|
|
F-8
|
Footnotes to Consolidated Financial Statements
|
|
F-9
|
Schedule II — Valuation and Qualifying Accounts
|
|
S-1
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(In thousands, except share data)
|
||||||
ASSETS
|
|||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
33,065
|
|
|
$
|
33,551
|
|
Accounts receivable, net
|
29,548
|
|
|
26,128
|
|
||
Unbilled receivables
|
11,815
|
|
|
44,032
|
|
||
Inventories, net
|
12,187
|
|
|
14,130
|
|
||
Prepaid expenses and other current assets
|
6,012
|
|
|
7,782
|
|
||
Total current assets
|
92,627
|
|
|
125,623
|
|
||
Deferred income tax asset, net
|
8,734
|
|
|
7,191
|
|
||
Property, plant and equipment, net
|
13,188
|
|
|
13,041
|
|
||
Multi-client data library, net
|
60,384
|
|
|
73,544
|
|
||
Goodwill
|
23,585
|
|
|
22,915
|
|
||
Right-of-use assets
|
32,546
|
|
|
47,803
|
|
||
Other assets
|
2,130
|
|
|
2,435
|
|
||
Total assets
|
$
|
233,194
|
|
|
$
|
292,552
|
|
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY
|
|||||||
Current liabilities:
|
|
|
|
||||
Current maturities of long-term debt
|
$
|
2,107
|
|
|
$
|
2,228
|
|
Accounts payable
|
49,316
|
|
|
34,913
|
|
||
Accrued expenses
|
30,328
|
|
|
31,411
|
|
||
Accrued multi-client data library royalties
|
18,831
|
|
|
29,256
|
|
||
Deferred revenue
|
4,551
|
|
|
7,710
|
|
||
Current maturities of operating lease liabilities
|
11,055
|
|
|
12,214
|
|
||
Total current liabilities
|
116,188
|
|
|
117,732
|
|
||
Long-term debt, net of current maturities
|
119,352
|
|
|
119,513
|
|
||
Operating lease liabilities, net of current maturities
|
30,833
|
|
|
45,592
|
|
||
Other long-term liabilities
|
1,453
|
|
|
1,891
|
|
||
Total liabilities
|
267,826
|
|
|
284,728
|
|
||
(Deficit) Equity:
|
|
|
|
||||
Common stock, $0.01 par value; authorized 26,666,667 shares; outstanding 14,224,787 and 14,015,615 shares at December 31, 2019 and 2018, respectively.
|
142
|
|
|
140
|
|
||
Additional paid-in capital
|
956,647
|
|
|
952,626
|
|
||
Accumulated deficit
|
(974,291
|
)
|
|
(926,092
|
)
|
||
Accumulated other comprehensive loss
|
(19,318
|
)
|
|
(20,442
|
)
|
||
Total stockholders’ (deficit) equity
|
(36,820
|
)
|
|
6,232
|
|
||
Noncontrolling interests
|
2,188
|
|
|
1,592
|
|
||
Total (deficit) equity
|
(34,632
|
)
|
|
7,824
|
|
||
Total liabilities and (deficit) equity
|
$
|
233,194
|
|
|
$
|
292,552
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(In thousands, except per share data)
|
||||||||||
Service revenues
|
$
|
131,280
|
|
|
$
|
139,038
|
|
|
$
|
159,410
|
|
Product revenues
|
43,399
|
|
|
41,007
|
|
|
38,144
|
|
|||
Total net revenues
|
174,679
|
|
|
180,045
|
|
|
197,554
|
|
|||
Cost of services
|
83,519
|
|
|
100,557
|
|
|
100,820
|
|
|||
Cost of products
|
22,066
|
|
|
19,868
|
|
|
18,791
|
|
|||
Impairment of multi-client data library
|
9,072
|
|
|
—
|
|
|
2,304
|
|
|||
Gross profit
|
60,022
|
|
|
59,620
|
|
|
75,639
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Research, development and engineering
|
19,025
|
|
|
18,182
|
|
|
16,431
|
|
|||
Marketing and sales
|
23,207
|
|
|
21,793
|
|
|
20,778
|
|
|||
General, administrative and other operating expenses
|
42,249
|
|
|
37,364
|
|
|
47,129
|
|
|||
Impairment of long-lived assets
|
—
|
|
|
36,553
|
|
|
—
|
|
|||
Total operating expenses
|
84,481
|
|
|
113,892
|
|
|
84,338
|
|
|||
Loss from operations
|
(24,459
|
)
|
|
(54,272
|
)
|
|
(8,699
|
)
|
|||
Interest expense, net
|
(13,074
|
)
|
|
(12,972
|
)
|
|
(16,709
|
)
|
|||
Other expense, net
|
(1,617
|
)
|
|
(436
|
)
|
|
(3,945
|
)
|
|||
Loss before income taxes
|
(39,150
|
)
|
|
(67,680
|
)
|
|
(29,353
|
)
|
|||
Income tax expense
|
8,064
|
|
|
2,718
|
|
|
24
|
|
|||
Net loss
|
(47,214
|
)
|
|
(70,398
|
)
|
|
(29,377
|
)
|
|||
Less: Net income attributable to noncontrolling interests
|
(985
|
)
|
|
(773
|
)
|
|
(865
|
)
|
|||
Net loss attributable to ION
|
$
|
(48,199
|
)
|
|
$
|
(71,171
|
)
|
|
$
|
(30,242
|
)
|
Net loss per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
(3.41
|
)
|
|
$
|
(5.20
|
)
|
|
$
|
(2.55
|
)
|
Diluted
|
$
|
(3.41
|
)
|
|
$
|
(5.20
|
)
|
|
$
|
(2.55
|
)
|
Weighted average number of common shares outstanding:
|
|
|
|
|
|
||||||
Basic
|
14,131
|
|
|
13,692
|
|
|
11,876
|
|
|||
Diluted
|
14,131
|
|
|
13,692
|
|
|
11,876
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(In thousands)
|
||||||||||
Net loss
|
$
|
(47,214
|
)
|
|
$
|
(70,398
|
)
|
|
$
|
(29,377
|
)
|
Other comprehensive income (loss), net of taxes, as appropriate:
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
1,124
|
|
|
(1,563
|
)
|
|
2,869
|
|
|||
Comprehensive net loss
|
(46,090
|
)
|
|
(71,961
|
)
|
|
(26,508
|
)
|
|||
Comprehensive income attributable to noncontrolling interests
|
(985
|
)
|
|
(773
|
)
|
|
(865
|
)
|
|||
Comprehensive net loss attributable to ION
|
$
|
(47,075
|
)
|
|
$
|
(72,734
|
)
|
|
$
|
(27,373
|
)
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(In thousands)
|
||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net loss
|
$
|
(47,214
|
)
|
|
$
|
(70,398
|
)
|
|
$
|
(29,377
|
)
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization (other than multi-client library)
|
3,657
|
|
|
8,763
|
|
|
16,592
|
|
|||
Amortization of multi-client data library
|
39,541
|
|
|
48,988
|
|
|
47,102
|
|
|||
Impairment of long-lived assets
|
—
|
|
|
36,553
|
|
|
—
|
|
|||
Impairment of multi-client data library
|
9,072
|
|
|
—
|
|
|
2,304
|
|
|||
Stock-based compensation expense
|
4,701
|
|
|
3,337
|
|
|
2,552
|
|
|||
Accrual of loss contingency related to legal proceedings
|
—
|
|
|
—
|
|
|
5,000
|
|
|||
Write-down of excess and obsolete inventory
|
517
|
|
|
665
|
|
|
398
|
|
|||
Deferred income taxes
|
(1,940
|
)
|
|
(6,252
|
)
|
|
(5,420
|
)
|
|||
Change in operating assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
(3,265
|
)
|
|
(7,024
|
)
|
|
1,692
|
|
|||
Unbilled receivables
|
32,055
|
|
|
(5,245
|
)
|
|
(23,947
|
)
|
|||
Inventories
|
1,067
|
|
|
(353
|
)
|
|
190
|
|
|||
Accounts payable, accrued expenses and accrued royalties
|
(2,492
|
)
|
|
(7,600
|
)
|
|
1,443
|
|
|||
Deferred revenue
|
(3,207
|
)
|
|
(1,112
|
)
|
|
5,131
|
|
|||
Other assets and liabilities
|
1,658
|
|
|
6,776
|
|
|
3,952
|
|
|||
Net cash provided by operating activities
|
34,150
|
|
|
7,098
|
|
|
27,612
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Investment in multi-client data library
|
(28,804
|
)
|
|
(28,276
|
)
|
|
(23,710
|
)
|
|||
Purchase of property, plant and equipment
|
(2,411
|
)
|
|
(1,514
|
)
|
|
(1,063
|
)
|
|||
Net cash used in investing activities
|
(31,215
|
)
|
|
(29,790
|
)
|
|
(24,773
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Borrowings under revolving line of credit
|
40,000
|
|
|
—
|
|
|
—
|
|
|||
Repayments under revolving line of credit
|
(40,000
|
)
|
|
(10,000
|
)
|
|
—
|
|
|||
Payments on notes payable and long-term debt
|
(2,553
|
)
|
|
(30,807
|
)
|
|
(4,816
|
)
|
|||
Cost associated with issuance of debt
|
—
|
|
|
(1,247
|
)
|
|
(53
|
)
|
|||
Net proceeds from issuance of stocks
|
—
|
|
|
46,999
|
|
|
—
|
|
|||
Proceeds from employee stock purchases and exercise of stock options
|
141
|
|
|
214
|
|
|
1,619
|
|
|||
Other financing activities
|
(1,134
|
)
|
|
(1,351
|
)
|
|
(343
|
)
|
|||
Net cash provided by (used in) financing activities
|
(3,546
|
)
|
|
3,808
|
|
|
(3,593
|
)
|
|||
Effect of change in foreign currency exchange rates on cash, cash equivalents and restricted cash
|
(125
|
)
|
|
319
|
|
|
(260
|
)
|
|||
Net decrease in cash, cash equivalents and restricted cash
|
(736
|
)
|
|
(18,565
|
)
|
|
(1,014
|
)
|
|||
Cash, cash equivalents and restricted cash at beginning of period
|
33,854
|
|
|
52,419
|
|
|
53,433
|
|
|||
Cash, cash equivalents and restricted cash at end of period
|
$
|
33,118
|
|
|
$
|
33,854
|
|
|
$
|
52,419
|
|
|
December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(In thousands)
|
||||||||||
Cash and cash equivalents
|
$
|
33,065
|
|
|
$
|
33,551
|
|
|
$
|
52,056
|
|
Restricted cash included in prepaid expenses and other current assets
|
53
|
|
|
—
|
|
|
60
|
|
|||
Restricted cash included in other long-term assets
|
—
|
|
|
303
|
|
|
303
|
|
|||
Total cash, cash equivalents, and restricted cash shown in consolidated statements of cash flows
|
$
|
33,118
|
|
|
$
|
33,854
|
|
|
$
|
52,419
|
|
|
|
Common Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Loss
|
|
Noncontrolling Interests
|
|
Total (Deficit) Equity
|
|||||||||||||||
(In thousands, except shares)
|
|
Shares
|
|
Amount
|
|
||||||||||||||||||||||
Balance at January 1, 2017
|
|
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
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Vested restricted stock cancelled for employee minimum income taxes
|
|
(23,889
|
)
|
|
—
|
|
|
(120
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(120
|
)
|
||||||
Employee purchases of unregistered shares of common stock
|
|
120,567
|
|
|
1
|
|
|
1,572
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,573
|
|
||||||
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
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Vested 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
|
|
||||||
Net (loss) income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(48,199
|
)
|
|
—
|
|
|
985
|
|
|
(47,214
|
)
|
||||||
Translation adjustment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,124
|
|
|
(74
|
)
|
|
1,050
|
|
||||||
Dividend payment to noncontrolling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(315
|
)
|
|
(315
|
)
|
||||||
Stock-based compensation expense
|
|
—
|
|
|
—
|
|
|
4,701
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,701
|
|
||||||
Exercise of stock options
|
|
86,900
|
|
|
1
|
|
|
140
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
141
|
|
||||||
Vesting of restricted stock units/awards
|
|
225,860
|
|
|
2
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Vested restricted stock cancelled for employee minimum income taxes
|
|
(103,588
|
)
|
|
(1
|
)
|
|
(818
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(819
|
)
|
||||||
Balance at December 31, 2019
|
|
14,224,787
|
|
|
$
|
142
|
|
|
$
|
956,647
|
|
|
$
|
(974,291
|
)
|
|
$
|
(19,318
|
)
|
|
$
|
2,188
|
|
|
$
|
(34,632
|
)
|
|
Years
|
Machinery and equipment
|
3-7
|
Buildings
|
5-25
|
Seismic rental equipment
|
3-5
|
Leased equipment and other
|
3-10
|
|
Years Ended December 31,
|
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
|
||||||
Net revenues:
|
|
|
|
|
|
|
||||||
E&P Technology & Services:
|
|
|
|
|
|
|
||||||
New Venture (a)
|
$
|
31,188
|
|
|
$
|
69,685
|
|
|
$
|
100,824
|
|
|
Data Library
|
71,847
|
|
|
47,095
|
|
|
40,016
|
|
|
|||
Total multi-client revenues (b)
|
103,035
|
|
|
116,780
|
|
|
140,840
|
|
|
|||
Imaging Services
|
22,543
|
|
|
19,740
|
|
|
16,409
|
|
|
|||
Total
|
$
|
125,578
|
|
|
$
|
136,520
|
|
|
$
|
157,249
|
|
|
Operations Optimization:
|
|
|
|
|
|
|
||||||
Optimization Software & Services
|
$
|
23,140
|
|
|
$
|
21,129
|
|
|
$
|
16,695
|
|
|
Devices
|
25,961
|
|
|
22,396
|
|
|
23,610
|
|
|
|||
Total
|
$
|
49,101
|
|
|
$
|
43,525
|
|
|
$
|
40,305
|
|
|
Total net revenues
|
$
|
174,679
|
|
|
$
|
180,045
|
|
|
$
|
197,554
|
|
|
Gross profit (loss):
|
|
|
|
|
|
|
||||||
E&P Technology & Services
|
$
|
35,699
|
|
|
$
|
43,369
|
|
|
$
|
65,196
|
|
|
Operations Optimization
|
24,323
|
|
|
22,293
|
|
|
20,076
|
|
|
|||
Segment gross profit
|
60,022
|
|
|
65,662
|
|
|
85,272
|
|
|
|||
Other
|
—
|
|
|
(6,042
|
)
|
(c)
|
(9,633
|
)
|
(c)
|
|||
Total gross profit
|
$
|
60,022
|
|
|
$
|
59,620
|
|
|
$
|
75,639
|
|
|
Gross margin:
|
|
|
|
|
|
|
||||||
E&P Technology & Services
|
28
|
%
|
|
32
|
%
|
|
41
|
%
|
|
|||
Operations Optimization
|
50
|
%
|
|
51
|
%
|
|
50
|
%
|
|
|||
Segment gross margin
|
34
|
%
|
|
36
|
%
|
|
43
|
%
|
|
|||
Other
|
—
|
%
|
|
(3
|
)%
|
|
(5
|
)%
|
|
|||
Total
|
34
|
%
|
|
33
|
%
|
|
38
|
%
|
|
|||
Income (loss) from operations:
|
|
|
|
|
|
|
||||||
E&P Technology & Services
|
$
|
8,833
|
|
|
$
|
21,758
|
|
|
$
|
42,505
|
|
|
Operations Optimization
|
8,189
|
|
|
7,295
|
|
|
8,022
|
|
|
|||
Support and other
|
(41,481
|
)
|
(d)
|
(83,325
|
)
|
(d)
|
(59,226
|
)
|
(d)
|
|||
Loss from operations
|
(24,459
|
)
|
|
(54,272
|
)
|
|
(8,699
|
)
|
|
|||
Interest expense, net
|
(13,074
|
)
|
|
(12,972
|
)
|
|
(16,709
|
)
|
|
|||
Other expense, net
|
(1,617
|
)
|
|
(436
|
)
|
|
(3,945
|
)
|
|
|||
Loss before income taxes
|
$
|
(39,150
|
)
|
|
$
|
(67,680
|
)
|
|
$
|
(29,353
|
)
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Depreciation and amortization expense (including multi-client data library) :
|
|
|
|
|
|
||||||
E&P Technology & Services
|
$
|
41,813
|
|
|
$
|
51,673
|
|
|
$
|
53,663
|
|
Operations Optimization
|
940
|
|
|
995
|
|
|
1,349
|
|
|||
Support and other (a)
|
445
|
|
|
5,083
|
|
|
8,682
|
|
|||
Total
|
$
|
43,198
|
|
|
$
|
57,751
|
|
|
$
|
63,694
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Total assets:
|
|
|
|
||||
E&P Technology & Services
|
$
|
133,787
|
|
|
$
|
191,207
|
|
Operations Optimization
|
56,927
|
|
|
54,933
|
|
||
Support and other (a)
|
42,480
|
|
|
46,412
|
|
||
Total
|
$
|
233,194
|
|
|
$
|
292,552
|
|
|
|
||
Unbilled receivables at December 31, 2018
|
$
|
44,032
|
|
Recognition of unbilled receivables
|
166,878
|
|
|
Revenues billed to customers
|
(199,095
|
)
|
|
Unbilled receivables at December 31, 2019
|
$
|
11,815
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
New Venture
|
$
|
1,956
|
|
|
$
|
5,797
|
|
Imaging Services
|
1,501
|
|
|
307
|
|
||
Devices
|
452
|
|
|
626
|
|
||
Optimization Software & Services
|
642
|
|
|
980
|
|
||
Total
|
$
|
4,551
|
|
|
$
|
7,710
|
|
|
|
||
Deferred revenue at December 31, 2018
|
$
|
7,710
|
|
Cash collected in excess of revenue recognized
|
4,642
|
|
|
Recognition of deferred revenue (a)
|
(7,801
|
)
|
|
Deferred revenue at December 31, 2019
|
$
|
4,551
|
|
|
|
December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Senior secured second-priority lien notes (maturing December 15, 2021)
|
|
$
|
120,569
|
|
|
$
|
120,569
|
|
Revolving credit facility (maturing August 16, 2023) (a)
|
|
—
|
|
|
—
|
|
||
Equipment finance leases (see Footnote 14)
|
|
1,869
|
|
|
2,938
|
|
||
Other debt
|
|
972
|
|
|
1,159
|
|
||
Costs associated with issuances of debt
|
|
(1,951
|
)
|
|
(2,925
|
)
|
||
Total
|
|
121,459
|
|
|
121,741
|
|
||
Current maturities of long-term debt
|
|
(2,107
|
)
|
|
(2,228
|
)
|
||
Long-term debt, net of current maturities
|
|
$
|
119,352
|
|
|
$
|
119,513
|
|
•
|
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 $10.0 million (from $40.0 million to $50.0 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 $15.0 million for the multi-client data library component);
|
•
|
include the eligible billed receivables of the Mexican Subsidiary up to a maximum of $5.0 million in the borrowing base calculation and joins the Mexican Subsidiary as a borrower thereunder (with a maximum exposure of $5.0 million) and require the equity and assets of the Mexican Subsidiary to be pledged to secure obligations under the 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 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
|
|
105.50%
|
2020
|
|
103.50%
|
2021
|
|
100.00%
|
Years Ending December 31,
|
|
Second Lien Notes
|
|
Other Financing
|
|
Total
|
||||||
2020
|
|
$
|
—
|
|
|
$
|
972
|
|
|
$
|
972
|
|
2021
|
|
120,569
|
|
|
—
|
|
|
120,569
|
|
|||
Total
|
|
$
|
120,569
|
|
|
$
|
972
|
|
|
$
|
121,541
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(166
|
)
|
State and local
|
2
|
|
|
65
|
|
|
116
|
|
|||
Foreign
|
10,002
|
|
|
8,905
|
|
|
5,494
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
Federal
|
—
|
|
|
(346
|
)
|
|
(1,263
|
)
|
|||
Foreign
|
(1,940
|
)
|
|
(5,906
|
)
|
|
(4,157
|
)
|
|||
Total income tax expense
|
$
|
8,064
|
|
|
$
|
2,718
|
|
|
$
|
24
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Expected income tax expense at 21% for 2019 and 2018 and 35% for 2017
|
$
|
(8,222
|
)
|
|
$
|
(14,213
|
)
|
|
$
|
(10,274
|
)
|
Foreign tax rate differential
|
(1,996
|
)
|
|
74
|
|
|
(2,914
|
)
|
|||
Foreign tax differences
|
(327
|
)
|
|
4,703
|
|
|
(5,610
|
)
|
|||
Global intangible low tax income inclusion
|
7,310
|
|
|
3,443
|
|
|
—
|
|
|||
State and local taxes
|
2
|
|
|
65
|
|
|
116
|
|
|||
Nondeductible expenses
|
865
|
|
|
1,604
|
|
|
4,308
|
|
|||
Change in U.S. tax rate
|
—
|
|
|
—
|
|
|
77,410
|
|
|||
Expired capital loss
|
—
|
|
|
—
|
|
|
1,114
|
|
|||
Valuation allowance:
|
|
|
|
|
|
||||||
Valuation allowance on expiring capital losses
|
—
|
|
|
—
|
|
|
(1,114
|
)
|
|||
Valuation allowance on operations
|
10,432
|
|
|
7,042
|
|
|
(63,012
|
)
|
|||
Total income tax expense
|
$
|
8,064
|
|
|
$
|
2,718
|
|
|
$
|
24
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Deferred income tax assets:
|
|
|
|
||||
Accrued expenses
|
$
|
1,588
|
|
|
$
|
1,126
|
|
Allowance accounts
|
6,161
|
|
|
6,415
|
|
||
Net operating loss carryforward
|
105,844
|
|
|
96,854
|
|
||
Equity method investment
|
35,292
|
|
|
35,292
|
|
||
Original issue discount
|
6,000
|
|
|
8,073
|
|
||
Interest limitation
|
10,132
|
|
|
5,845
|
|
||
Basis in identified intangibles
|
7,090
|
|
|
4,146
|
|
||
Tax credit carryforwards
|
5,070
|
|
|
5,345
|
|
||
Other
|
4,443
|
|
|
4,600
|
|
||
Total deferred income tax asset
|
181,620
|
|
|
167,696
|
|
||
Valuation allowance
|
(170,937
|
)
|
|
(160,505
|
)
|
||
Net deferred income tax asset
|
10,683
|
|
|
7,191
|
|
||
Deferred income tax liabilities:
|
|
|
|
||||
Unbilled receivables
|
(1,949
|
)
|
|
—
|
|
||
Total deferred income tax asset, net
|
$
|
8,734
|
|
|
$
|
7,191
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Beginning balance
|
$
|
447
|
|
|
$
|
447
|
|
|
$
|
1,299
|
|
Increases in unrecognized tax benefits – current year positions
|
—
|
|
|
—
|
|
|
59
|
|
|||
Decreases in unrecognized tax benefits – prior year position
|
—
|
|
|
—
|
|
|
(911
|
)
|
|||
Ending balance
|
$
|
447
|
|
|
$
|
447
|
|
|
$
|
447
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Accrual for loss contingency related to legal proceedings (see Footnote 8)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(5,000
|
)
|
Recovery of INOVA bad debts
|
—
|
|
|
—
|
|
|
844
|
|
|||
Other income (expense)
|
(1,617
|
)
|
|
(436
|
)
|
|
211
|
|
|||
Total other expense, net
|
$
|
(1,617
|
)
|
|
$
|
(436
|
)
|
|
$
|
(3,945
|
)
|
A summary of accounts receivable follows (in thousands):
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Accounts receivable, principally trade
|
$
|
29,548
|
|
|
$
|
26,558
|
|
Less: allowance for doubtful accounts
|
—
|
|
|
(430
|
)
|
||
Accounts receivable, net
|
$
|
29,548
|
|
|
$
|
26,128
|
|
A summary of inventories follows (in thousands):
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Raw materials and purchased subassemblies
|
$
|
18,509
|
|
|
$
|
20,011
|
|
Work-in-process
|
2,079
|
|
|
1,032
|
|
||
Finished goods
|
4,932
|
|
|
8,111
|
|
||
Less: reserve for excess and obsolete inventories
|
(13,333
|
)
|
|
(15,024
|
)
|
||
Inventories, net
|
$
|
12,187
|
|
|
$
|
14,130
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Buildings
|
$
|
15,486
|
|
|
$
|
15,707
|
|
Machinery and equipment
|
133,048
|
|
|
132,135
|
|
||
Seismic rental equipment
|
1,669
|
|
|
1,423
|
|
||
Furniture and fixtures
|
3,347
|
|
|
3,859
|
|
||
Other
|
31,142
|
|
|
30,104
|
|
||
Total
|
184,692
|
|
|
183,228
|
|
||
Less: accumulated depreciation
|
(134,951
|
)
|
|
(133,634
|
)
|
||
Less: impairment of long-lived assets
|
(36,553
|
)
|
|
(36,553
|
)
|
||
Property, plant, equipment and seismic rental equipment, net
|
$
|
13,188
|
|
|
$
|
13,041
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Gross costs of multi-client data creation
|
$
|
1,007,762
|
|
|
$
|
972,309
|
|
Less: accumulated amortization
|
(816,401
|
)
|
|
(776,860
|
)
|
||
Less: impairments to multi-client data library
|
(130,977
|
)
|
|
(121,905
|
)
|
||
Multi-client data library, net
|
$
|
60,384
|
|
|
$
|
73,544
|
|
A summary of accrued expenses follows (in thousands):
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Compensation, including compensation-related taxes and commissions
|
$
|
15,218
|
|
|
$
|
14,502
|
|
Accrued multi-client data library acquisition costs
|
4,219
|
|
|
3,746
|
|
||
Income tax payable
|
5,367
|
|
|
7,577
|
|
||
Other
|
5,524
|
|
|
5,586
|
|
||
Total
|
$
|
30,328
|
|
|
$
|
31,411
|
|
|
E&P Technology & Services
|
|
Optimization Software & Services
|
|
Total
|
||||||
Balance at January 1, 2018
|
$
|
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
|
|
|||
Impact of foreign currency translation adjustments
|
—
|
|
|
670
|
|
|
670
|
|
|||
Balance at December 31, 2019
|
$
|
2,943
|
|
|
$
|
20,642
|
|
|
$
|
23,585
|
|
|
Option Price
per Share
|
|
Outstanding
|
|
Vested
|
|
Available
for Grant
|
||||
January 1, 2017
|
$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
|
)
|
Vested 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
|
)
|
Vested 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
|
|
Granted
|
6.79 - 8.43
|
|
|
20,000
|
|
|
—
|
|
|
(20,000
|
)
|
Vested
|
—
|
|
|
—
|
|
|
167,991
|
|
|
—
|
|
Exercised
|
3.10
|
|
|
(86,900
|
)
|
|
(86,900
|
)
|
|
—
|
|
Cancelled/forfeited
|
13.15 - 107.85
|
|
|
(29,781
|
)
|
|
(22,281
|
)
|
|
10,799
|
|
Restricted stock granted out of option plans
|
—
|
|
|
—
|
|
|
—
|
|
|
(157,155
|
)
|
Vested restricted stock forfeited or cancelled for employee minimum income taxes and returned to the plans
|
—
|
|
|
—
|
|
|
—
|
|
|
170,254
|
|
December 31, 2019
|
$3.10 - $151.35
|
|
|
689,209
|
|
|
533,715
|
|
|
736,618
|
|
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
|
477,764
|
|
|
$
|
17.36
|
|
|
8.1 years
|
|
261,364
|
|
|
$
|
12.63
|
|
$61.05 - $71.85
|
74,432
|
|
|
$
|
62.18
|
|
|
3.7 years
|
|
134,739
|
|
|
$
|
60.20
|
|
$81.60 - $99.60
|
94,827
|
|
|
$
|
89.87
|
|
|
2.6 years
|
|
95,426
|
|
|
$
|
89.76
|
|
$106.05 - $151.35
|
42,186
|
|
|
$
|
108.86
|
|
|
1.3 years
|
|
42,186
|
|
|
$
|
108.86
|
|
Totals
|
689,209
|
|
|
$
|
37.78
|
|
|
5.5 years
|
|
533,715
|
|
|
$
|
46.04
|
|
|
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, 2019
|
785,890
|
|
|
$
|
35.33
|
|
|
|
|
5.4 years
|
|
$
|
572
|
|
||
Options granted
|
20,000
|
|
|
$
|
7.61
|
|
|
$
|
4.91
|
|
|
|
|
|
||
Options exercised
|
(86,900
|
)
|
|
$
|
3.10
|
|
|
|
|
|
|
|
||||
Options cancelled
|
(7,500
|
)
|
|
$
|
13.15
|
|
|
|
|
|
|
|
||||
Options forfeited
|
(22,281
|
)
|
|
$
|
67.88
|
|
|
|
|
|
|
|
||||
Total outstanding at December 31, 2019
|
689,209
|
|
|
$
|
37.78
|
|
|
|
|
5.5 years
|
|
$
|
1,071
|
|
||
Options exercisable and vested at December 31, 2019
|
533,715
|
|
|
$
|
46.04
|
|
|
|
|
4.5 years
|
|
$
|
742
|
|
|
Years Ended December 31,
|
||||
|
2019
|
|
2018
|
|
2017
|
Risk-free interest rates
|
1.62%
|
|
2.78%
|
|
2.14%
|
Expected lives (in years)
|
5.0
|
|
5.0
|
|
5.0
|
Expected dividend yield
|
—%
|
|
—%
|
|
—%
|
Expected volatility
|
84.64%
|
|
73.67%
|
|
74.41%
|
|
Number of
Shares/Units
|
|
Total nonvested at January 1, 2019
|
1,044,125
|
|
Granted
|
157,155
|
|
Vested
|
(225,860
|
)
|
Forfeited
|
(66,666
|
)
|
Total nonvested at December 31, 2019
|
908,754
|
|
|
Years Ended December 31,
|
||||
|
2019
|
|
2018
|
||
Risk-free interest rates
|
1.9
|
%
|
|
3.0
|
%
|
Expected lives (in years)
|
5.31
|
|
|
5.31
|
|
Expected dividend yield
|
—
|
%
|
|
—
|
%
|
Expected volatility
|
79.0
|
%
|
|
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, 2017
|
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
|
|
|
|
|
|
|
|
||||
SARs exercised
|
(158,334
|
)
|
|
$
|
3.10
|
|
|
|
|
|
|
|
||||
SARs cancelled
|
(368,528
|
)
|
|
$
|
20.99
|
|
|
|
|
|
|
|
||||
Total outstanding at December 31, 2019
|
954,679
|
|
|
$
|
7.73
|
|
|
|
|
7.8 years
|
|
$
|
1,042
|
|
||
SARs exercisable and vested at December 31, 2019
|
186,670
|
|
|
$
|
3.10
|
|
|
|
|
6.2 years
|
|
$
|
1,042
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Stock-based compensation expense
|
$
|
4,701
|
|
|
$
|
3,337
|
|
|
$
|
2,552
|
|
Tax benefit related thereto
|
(972
|
)
|
|
(698
|
)
|
|
(862
|
)
|
|||
Stock-based compensation expense, net of tax
|
$
|
3,729
|
|
|
$
|
2,639
|
|
|
$
|
1,690
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Stock appreciation rights expense
|
$
|
2,910
|
|
|
$
|
822
|
|
|
$
|
6,611
|
|
Tax benefit related thereto
|
(611
|
)
|
|
(173
|
)
|
|
(2,314
|
)
|
|||
Stock appreciation rights expense, net of tax
|
$
|
2,299
|
|
|
$
|
649
|
|
|
$
|
4,297
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Cash paid during the period for:
|
|
|
|
|
|
||||||
Interest
|
$
|
12,381
|
|
|
$
|
12,463
|
|
|
$
|
14,181
|
|
Income taxes
|
11,065
|
|
|
3,260
|
|
|
7,030
|
|
|||
Non-cash items from investing and financing activities:
|
|
|
|
|
|
||||||
Purchase of computer equipment financed through capital leases
|
—
|
|
|
3,297
|
|
|
—
|
|
|||
Investment in multi-client data library financed through trade payables and accruals
|
6,649
|
|
|
4,956
|
|
|
9,059
|
|
Years Ending December 31,
|
Operating Leases
|
|
Finance Leases
|
|
Total
|
||||||
2020
|
$
|
12,708
|
|
|
$
|
1,254
|
|
|
$
|
13,962
|
|
2021
|
10,911
|
|
|
756
|
|
|
11,667
|
|
|||
2022
|
10,718
|
|
|
—
|
|
|
10,718
|
|
|||
2023
|
9,258
|
|
|
—
|
|
|
9,258
|
|
|||
2024
|
5,109
|
|
|
—
|
|
|
5,109
|
|
|||
Thereafter
|
4,022
|
|
|
—
|
|
|
4,022
|
|
|||
Total lease payments
|
$
|
52,726
|
|
|
$
|
2,010
|
|
|
$
|
54,736
|
|
Less imputed interest
|
(10,838
|
)
|
|
(141
|
)
|
|
(10,979
|
)
|
|||
Total
|
$
|
41,888
|
|
|
$
|
1,869
|
|
|
$
|
43,757
|
|
|
Years Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
|
|
||||
Operating leases
|
$
|
12,284
|
|
|
$
|
12,914
|
|
Equipment finance leases
|
1,069
|
|
|
638
|
|
|
Three Months Ended
|
||||||||||||||
|
March 31, 2019
|
|
June 30, 2019
|
|
September 30, 2019
|
|
December 31, 2019
|
||||||||
Service revenues
|
$
|
28,128
|
|
|
$
|
30,407
|
|
|
$
|
41,990
|
|
|
$
|
30,755
|
|
Product revenues
|
8,828
|
|
|
11,368
|
|
|
11,249
|
|
|
11,954
|
|
||||
Total net revenues
|
36,956
|
|
|
41,775
|
|
|
53,239
|
|
|
42,709
|
|
||||
Gross profit
|
9,912
|
|
|
19,583
|
|
|
25,288
|
|
|
5,239
|
|
||||
Income (loss) from operations
|
(15,937
|
)
|
|
(2,553
|
)
|
|
3,858
|
|
|
(9,827
|
)
|
||||
Interest expense, net
|
(3,112
|
)
|
|
(3,111
|
)
|
|
(3,155
|
)
|
|
(3,696
|
)
|
||||
Other income (expense), net
|
(792
|
)
|
|
96
|
|
|
(242
|
)
|
|
(679
|
)
|
||||
Income tax expense
|
1,407
|
|
|
2,719
|
|
|
3,790
|
|
|
148
|
|
||||
Net income attributable to noncontrolling interests
|
(112
|
)
|
|
(335
|
)
|
|
(394
|
)
|
|
(144
|
)
|
||||
Net loss applicable to ION
|
$
|
(21,360
|
)
|
|
$
|
(8,622
|
)
|
|
$
|
(3,723
|
)
|
|
$
|
(14,494
|
)
|
Net loss per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(1.52
|
)
|
|
$
|
(0.61
|
)
|
|
$
|
(0.26
|
)
|
|
$
|
(1.02
|
)
|
Diluted
|
$
|
(1.52
|
)
|
|
$
|
(0.61
|
)
|
|
$
|
(0.26
|
)
|
|
$
|
(1.02
|
)
|
|
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
|
)
|
•
|
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 not Guarantors.
|
•
|
The consolidating adjustments necessary to present ION Geophysical Corporation’s results on a consolidated basis.
|
|
December 31, 2019
|
||||||||||||||||||
Balance Sheet
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
8,426
|
|
|
$
|
26
|
|
|
$
|
24,613
|
|
|
$
|
—
|
|
|
$
|
33,065
|
|
Accounts receivable, net
|
8
|
|
|
19,493
|
|
|
10,047
|
|
|
—
|
|
|
29,548
|
|
|||||
Unbilled receivables
|
—
|
|
|
7,314
|
|
|
4,501
|
|
|
—
|
|
|
11,815
|
|
|||||
Inventories, net
|
—
|
|
|
6,902
|
|
|
5,285
|
|
|
—
|
|
|
12,187
|
|
|||||
Prepaid expenses and other current assets
|
3,292
|
|
|
1,513
|
|
|
1,207
|
|
|
—
|
|
|
6,012
|
|
|||||
Total current assets
|
11,726
|
|
|
35,248
|
|
|
45,653
|
|
|
—
|
|
|
92,627
|
|
|||||
Deferred income tax asset
|
402
|
|
|
8,417
|
|
|
(85
|
)
|
|
—
|
|
|
8,734
|
|
|||||
Property, plant and equipment, net
|
786
|
|
|
8,112
|
|
|
4,290
|
|
|
—
|
|
|
13,188
|
|
|||||
Multi-client data library, net
|
—
|
|
|
54,479
|
|
|
5,905
|
|
|
—
|
|
|
60,384
|
|
|||||
Investment in subsidiaries
|
841,522
|
|
|
279,327
|
|
|
—
|
|
|
(1,120,849
|
)
|
|
—
|
|
|||||
Goodwill
|
—
|
|
|
—
|
|
|
23,585
|
|
|
—
|
|
|
23,585
|
|
|||||
Right-of-use assets
|
11,934
|
|
|
15,802
|
|
|
4,810
|
|
|
—
|
|
|
32,546
|
|
|||||
Intercompany receivables
|
—
|
|
|
287,692
|
|
|
99,884
|
|
|
(387,576
|
)
|
|
—
|
|
|||||
Other assets
|
1,171
|
|
|
905
|
|
|
54
|
|
|
—
|
|
|
2,130
|
|
|||||
Total assets
|
$
|
867,541
|
|
|
$
|
689,982
|
|
|
$
|
184,096
|
|
|
$
|
(1,508,425
|
)
|
|
$
|
233,194
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current maturities of long-term debt
|
$
|
972
|
|
|
$
|
1,135
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,107
|
|
Accounts payable
|
2,259
|
|
|
44,641
|
|
|
2,416
|
|
|
—
|
|
|
49,316
|
|
|||||
Accrued expenses
|
9,933
|
|
|
9,982
|
|
|
10,413
|
|
|
—
|
|
|
30,328
|
|
|||||
Accrued multi-client data library royalties
|
—
|
|
|
18,616
|
|
|
215
|
|
|
—
|
|
|
18,831
|
|
|||||
Deferred revenue
|
—
|
|
|
3,465
|
|
|
1,086
|
|
|
—
|
|
|
4,551
|
|
|||||
Current maturities of operating lease liabilities
|
4,429
|
|
|
5,469
|
|
|
1,157
|
|
|
—
|
|
|
11,055
|
|
|||||
Total current liabilities
|
17,593
|
|
|
83,308
|
|
|
15,287
|
|
|
—
|
|
|
116,188
|
|
|||||
Long-term debt, net of current maturities
|
118,618
|
|
|
734
|
|
|
—
|
|
|
—
|
|
|
119,352
|
|
|||||
Operating lease liabilities, net of current maturities
|
11,208
|
|
|
15,346
|
|
|
4,279
|
|
|
—
|
|
|
30,833
|
|
|||||
Intercompany payables
|
755,524
|
|
|
—
|
|
|
—
|
|
|
(755,524
|
)
|
|
—
|
|
|||||
Other long-term liabilities
|
1,418
|
|
|
35
|
|
|
—
|
|
|
—
|
|
|
1,453
|
|
|||||
Total liabilities
|
904,361
|
|
|
99,423
|
|
|
19,566
|
|
|
(755,524
|
)
|
|
267,826
|
|
|||||
Equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock
|
142
|
|
|
290,460
|
|
|
47,776
|
|
|
(338,236
|
)
|
|
142
|
|
|||||
Additional paid-in capital
|
956,647
|
|
|
180,700
|
|
|
203,909
|
|
|
(384,609
|
)
|
|
956,647
|
|
|||||
Accumulated earnings (deficit)
|
(974,291
|
)
|
|
396,793
|
|
|
18,837
|
|
|
(415,630
|
)
|
|
(974,291
|
)
|
|||||
Accumulated other comprehensive income (loss)
|
(19,318
|
)
|
|
4,281
|
|
|
(21,907
|
)
|
|
17,626
|
|
|
(19,318
|
)
|
|||||
Due from ION Geophysical Corporation
|
—
|
|
|
(281,675
|
)
|
|
(86,273
|
)
|
|
367,948
|
|
|
—
|
|
|||||
Total stockholders’ equity
|
(36,820
|
)
|
|
590,559
|
|
|
162,342
|
|
|
(752,901
|
)
|
|
(36,820
|
)
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
2,188
|
|
|
—
|
|
|
2,188
|
|
|||||
Total equity
|
(36,820
|
)
|
|
590,559
|
|
|
164,530
|
|
|
(752,901
|
)
|
|
(34,632
|
)
|
|||||
Total liabilities and equity
|
$
|
867,541
|
|
|
$
|
689,982
|
|
|
$
|
184,096
|
|
|
$
|
(1,508,425
|
)
|
|
$
|
233,194
|
|
|
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, net
|
—
|
|
|
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 and 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
|
|
|||||
Right-of-use assets
|
18,513
|
|
|
21,350
|
|
|
7,940
|
|
|
—
|
|
|
47,803
|
|
|||||
Intercompany receivables
|
—
|
|
|
305,623
|
|
|
60,255
|
|
|
(365,878
|
)
|
|
—
|
|
|||||
Other assets
|
1,723
|
|
|
643
|
|
|
69
|
|
|
—
|
|
|
2,435
|
|
|||||
Total assets
|
$
|
875,213
|
|
|
$
|
700,677
|
|
|
$
|
165,901
|
|
|
$
|
(1,449,239
|
)
|
|
$
|
292,552
|
|
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
|
|
|||||
Current maturities of operating lease liabilities
|
5,155
|
|
|
5,633
|
|
|
1,426
|
|
|
—
|
|
|
12,214
|
|
|||||
Total current liabilities
|
15,732
|
|
|
81,895
|
|
|
20,105
|
|
|
—
|
|
|
117,732
|
|
|||||
Long-term debt, net of current maturities
|
117,644
|
|
|
1,869
|
|
|
—
|
|
|
—
|
|
|
119,513
|
|
|||||
Operating lease liabilities, net of current maturities
|
17,841
|
|
|
21,237
|
|
|
6,514
|
|
|
—
|
|
|
45,592
|
|
|||||
Intercompany payables
|
716,051
|
|
|
—
|
|
|
—
|
|
|
(716,051
|
)
|
|
—
|
|
|||||
Other long-term liabilities
|
1,713
|
|
|
178
|
|
|
—
|
|
|
|
|
|
1,891
|
|
|||||
Total liabilities
|
868,981
|
|
|
105,179
|
|
|
26,619
|
|
|
(716,051
|
)
|
|
284,728
|
|
|||||
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
|
$
|
875,213
|
|
|
$
|
700,677
|
|
|
$
|
165,901
|
|
|
$
|
(1,449,239
|
)
|
|
$
|
292,552
|
|
|
Year Ended December 31, 2019
|
||||||||||||||||||
Income Statement
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Consolidating Adjustments
|
|
Total Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Total net revenues
|
$
|
—
|
|
|
$
|
90,526
|
|
|
$
|
84,153
|
|
|
$
|
—
|
|
|
$
|
174,679
|
|
Cost of goods sold
|
—
|
|
|
86,531
|
|
|
28,126
|
|
|
—
|
|
|
114,657
|
|
|||||
Gross profit
|
—
|
|
|
3,995
|
|
|
56,027
|
|
|
—
|
|
|
60,022
|
|
|||||
Total operating expenses
|
37,293
|
|
|
32,435
|
|
|
14,753
|
|
|
—
|
|
|
84,481
|
|
|||||
Income (loss) from operations
|
(37,293
|
)
|
|
(28,440
|
)
|
|
41,274
|
|
|
—
|
|
|
(24,459
|
)
|
|||||
Interest expense, net
|
(12,827
|
)
|
|
(638
|
)
|
|
391
|
|
|
—
|
|
|
(13,074
|
)
|
|||||
Intercompany interest, net
|
513
|
|
|
(1,423
|
)
|
|
910
|
|
|
—
|
|
|
—
|
|
|||||
Equity in earnings (losses) of investments
|
1,464
|
|
|
35,950
|
|
|
—
|
|
|
(37,414
|
)
|
|
—
|
|
|||||
Other expense
|
(12
|
)
|
|
(407
|
)
|
|
(1,198
|
)
|
|
—
|
|
|
(1,617
|
)
|
|||||
Income (loss) before income taxes
|
(48,155
|
)
|
|
5,042
|
|
|
41,377
|
|
|
(37,414
|
)
|
|
(39,150
|
)
|
|||||
Income tax expense (benefit)
|
44
|
|
|
(1,060
|
)
|
|
9,080
|
|
|
—
|
|
|
8,064
|
|
|||||
Net income (loss)
|
(48,199
|
)
|
|
6,102
|
|
|
32,297
|
|
|
(37,414
|
)
|
|
(47,214
|
)
|
|||||
Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(985
|
)
|
|
—
|
|
|
(985
|
)
|
|||||
Net income (loss) attributable to ION
|
$
|
(48,199
|
)
|
|
$
|
6,102
|
|
|
$
|
31,312
|
|
|
$
|
(37,414
|
)
|
|
$
|
(48,199
|
)
|
Comprehensive net income (loss)
|
$
|
(47,075
|
)
|
|
$
|
6,059
|
|
|
$
|
32,413
|
|
|
$
|
(37,487
|
)
|
|
$
|
(46,090
|
)
|
Comprehensive income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(985
|
)
|
|
—
|
|
|
(985
|
)
|
|||||
Comprehensive net income (loss) attributable to ION
|
$
|
(47,075
|
)
|
|
$
|
6,059
|
|
|
$
|
31,428
|
|
|
$
|
(37,487
|
)
|
|
$
|
(47,075
|
)
|
|
|
|
|
|
|
|
|
|
|
|
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, 2019
|
||||||||||||||
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 operating activities
|
$
|
10,342
|
|
|
$
|
14,642
|
|
|
$
|
9,166
|
|
|
$
|
34,150
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
||||||||
Investment in multi-client data library
|
—
|
|
|
(18,765
|
)
|
|
(10,039
|
)
|
|
(28,804
|
)
|
||||
Purchase of property, plant and equipment
|
(375
|
)
|
|
(909
|
)
|
|
(1,127
|
)
|
|
(2,411
|
)
|
||||
Net cash used in investing activities
|
(375
|
)
|
|
(19,674
|
)
|
|
(11,166
|
)
|
|
(31,215
|
)
|
||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
||||||||
Borrowings under revolving line of credit
|
40,000
|
|
|
—
|
|
|
—
|
|
|
40,000
|
|
||||
Repayments under revolving line of credit
|
(40,000
|
)
|
|
—
|
|
|
—
|
|
|
(40,000
|
)
|
||||
Payments on notes payable and long-term debt
|
(1,069
|
)
|
|
(1,484
|
)
|
|
—
|
|
|
(2,553
|
)
|
||||
Intercompany lending
|
(13,511
|
)
|
|
6,495
|
|
|
7,016
|
|
|
—
|
|
||||
Proceeds from employee stock purchases and exercise of stock options
|
141
|
|
|
—
|
|
|
—
|
|
|
141
|
|
||||
Other financing activities
|
(1,134
|
)
|
|
—
|
|
|
—
|
|
|
(1,134
|
)
|
||||
Net cash provided by (used in) financing activities
|
(15,573
|
)
|
|
5,011
|
|
|
7,016
|
|
|
(3,546
|
)
|
||||
Effect of change in foreign currency exchange rates on cash, cash equivalents and restricted cash
|
—
|
|
|
—
|
|
|
(125
|
)
|
|
(125
|
)
|
||||
Net increase (decrease) in cash and cash equivalents
|
(5,606
|
)
|
|
(21
|
)
|
|
4,891
|
|
|
(736
|
)
|
||||
Cash, cash equivalents and restricted cash at beginning of period
|
14,085
|
|
|
47
|
|
|
19,722
|
|
|
33,854
|
|
||||
Cash, cash equivalents and restricted cash at end of period
|
$
|
8,479
|
|
|
$
|
26
|
|
|
$
|
24,613
|
|
|
$
|
33,118
|
|
|
December 31, 2019
|
||||||||||||||
|
ION Geophysical Corporation
|
|
The Guarantors
|
|
All Other Subsidiaries
|
|
Total Consolidated
|
||||||||
|
(In thousands)
|
||||||||||||||
Cash and cash equivalents
|
$
|
8,426
|
|
|
$
|
26
|
|
|
$
|
24,613
|
|
|
$
|
33,065
|
|
Restricted cash included in prepaid expenses and other current assets
|
53
|
|
|
—
|
|
|
—
|
|
|
53
|
|
||||
Total cash, cash equivalents, and restricted cash shown in statements of cash flows
|
$
|
8,479
|
|
|
$
|
26
|
|
|
$
|
24,613
|
|
|
$
|
33,118
|
|
|
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 and 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
|
|
|
—
|
|
||||
Net proceeds from issuance of stocks
|
46,999
|
|
|
—
|
|
|
—
|
|
|
46,999
|
|
||||
Proceeds from employee stock purchases and exercise of stock options
|
214
|
|
|
—
|
|
|
—
|
|
|
214
|
|
||||
Other financing activities
|
(1,351
|
)
|
|
—
|
|
|
—
|
|
|
(1,351
|
)
|
||||
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 and equipment
|
(165
|
)
|
|
(817
|
)
|
|
(81
|
)
|
|
(1,063
|
)
|
||||
Proceeds from sale of a cost-method investment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
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
|
|
||||
Other financing activities
|
(343
|
)
|
|
—
|
|
|
—
|
|
|
(343
|
)
|
||||
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, 2017
|
Balance at
Beginning of Year |
|
Charged (Credited) to
Costs and Expenses |
|
Deductions
|
|
Balance at
End of Year |
||||||||
|
(In thousands)
|
||||||||||||||
Allowances for doubtful accounts
|
$
|
1,443
|
|
|
$
|
949
|
|
|
$
|
(1,820
|
)
|
|
$
|
572
|
|
Allowances for doubtful notes receivable
|
4,000
|
|
|
—
|
|
|
—
|
|
|
4,000
|
|
||||
Valuation allowance on deferred tax assets
|
217,589
|
|
|
(64,126
|
)
|
|
—
|
|
|
153,463
|
|
||||
Excess and obsolete inventory
|
15,049
|
|
|
398
|
|
|
(408
|
)
|
|
15,039
|
|
Year Ended December 31, 2018
|
Balance at
Beginning of Year |
|
Charged (Credited) to
Costs and Expenses |
|
Deductions
|
|
Balance at
End of Year |
||||||||
|
(In thousands)
|
||||||||||||||
Allowances for doubtful accounts
|
$
|
572
|
|
|
$
|
222
|
|
|
$
|
(364
|
)
|
|
$
|
430
|
|
Allowances for doubtful notes receivable
|
4,000
|
|
|
—
|
|
|
—
|
|
|
4,000
|
|
||||
Valuation allowance on deferred tax assets
|
153,463
|
|
|
7,042
|
|
|
—
|
|
|
160,505
|
|
||||
Excess and obsolete inventory
|
15,039
|
|
|
665
|
|
|
(680
|
)
|
|
15,024
|
|
Year Ended December 31, 2019
|
Balance at
Beginning of Year
|
|
Charged (Credited) to
Costs and Expenses
|
|
Deductions
|
|
Balance at
End of Year
|
||||||||
|
(In thousands)
|
||||||||||||||
Allowances for doubtful accounts
|
$
|
430
|
|
|
$
|
—
|
|
|
$
|
(430
|
)
|
|
$
|
—
|
|
Allowances for doubtful notes receivable
|
4,000
|
|
|
—
|
|
|
—
|
|
|
4,000
|
|
||||
Valuation allowance on deferred tax assets
|
160,505
|
|
|
10,432
|
|
|
—
|
|
|
170,937
|
|
||||
Excess and obsolete inventory
|
15,024
|
|
|
517
|
|
|
(2,208
|
)
|
|
13,333
|
|
Subsidiary
|
Jurisdiction
|
|
|
Concept Systems Holdings Limited
|
Scotland
|
Concept Systems Limited
|
Scotland
|
GMG/AXIS, Inc.
|
Delaware
|
GX Geoscience Corporation S. de R.L. de C.V.
|
Mexico
|
GX Technology Australia Pty Ltd.
|
Australia
|
GX Technology Canada, Ltd.
|
Canada
|
GX Technology Corporation
|
Texas
|
GX Technology EAME, Limited
|
UK
|
GX Technology Imaging Services Limited
|
Egypt
|
GX Technology Poland Sp. Z o.o.
|
Poland
|
GX Technology Processamento de Dados Ltda.
|
Brazil
|
GX Technology Sismica Brasil Ltda.
|
Brazil
|
GX Technology Trinidad, Ltd.
|
West Indies
|
I/O Cayman Islands, Ltd.
|
Cayman Islands
|
I/O International Holdings, Ltd.
|
Cayman Islands
|
I/O International, Ltd.
|
Cayman Islands
|
I/O Luxembourg S.à r.l.
|
Luxembourg
|
I/O Marine Systems Limited
|
UK
|
I/O Marine Systems, Inc.
|
Louisiana
|
I/O U.K. Holdings Limited
|
Scotland
|
“Inco” Industrial Components ‘s-Gravenhage B.V.
|
Netherlands
|
ION China Holdings, Limited
|
Hong Kong
|
ION E&P Advisors, Inc.
|
Delaware
|
ION EPA Holdings, Inc.
|
Delaware
|
ION Exploration Products (U.S.A.), Inc.
|
Delaware
|
ION Geophysical CIS LLC
|
Russia
|
ION Geophysical Sdn. Bhd.
|
Malaysia
|
ION HPC Services, Inc.
|
Delaware
|
ION International Holdings L.P.
|
Bermuda
|
ION International S.à r.l.
|
Luxembourg
|
IPOP Management, Inc.
|
Delaware
|
OceanGeo B.V.
|
Netherlands
|
OceanGeo Inc.
|
British Virgin Islands
|
OceanGeo Ltd.
|
UK
|
Oceangeo Tecnologia de Exploração de Reservatórios do Brasil EIRELI
|
Brazil
|
Sensor Nederland B.V.
|
Netherlands
|
1.
|
Registration Statement (Form S-8 No. 333-60950) pertaining to the Input/Output, Inc. Non‑Employee Directors’ Retainer Plan,
|
2.
|
Registration Statement (Form S-8 No. 333-112677) pertaining to the Input/Output, Inc. 2003 Employee Stock Option Plan,
|
3.
|
Registration Statement (Form S-8 No. 333-125655) pertaining to the Input/Output, Inc. 2004 Long‑Term Incentive Plan,
|
4.
|
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,
|
5.
|
Registration Statement (Form S-3 No. 333-112263) of Input/Output, Inc.,
|
6.
|
Registration Statement (Form S-3 No. 333-123632) of Input/Output, Inc.,
|
7.
|
Registration Statement (Form S-8 No. 333-145274) pertaining to the Third Amended and Restated Input/Output, Inc. 2004 Long-Term Incentive Plan,
|
8.
|
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,
|
9.
|
Registration Statement (Form S-3 No. 333-159898) of ION Geophysical Corporation,
|
10.
|
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,
|
11.
|
Registration Statement (Form S-3 No. 333-166200) of ION Geophysical Corporation,
|
12.
|
Registration Statement (Form S-8 No. 333-176046) pertaining to the Sixth Amended and Restated 2004 Long-Term Incentive Plan,
|
13.
|
Registration Statement (Form S-8 No. 333-190474) pertaining to the 2013 Long-Term Incentive Plan,
|
14.
|
Registration Statement (Form S-4 No. 333-194110) of ION Geophysical Corporation,
|
15.
|
Registration Statement (Form S-8 No. 333-209707) pertaining to the 2013 Long-Term Incentive Plan,
|
16.
|
Registration Statement (Form S-3 No. 333-234606) of ION Geophysical Corporation, and
|
17.
|
Registration Statement (Form S-8 No. 333-229311) pertaining to the Third Amended and Restated 2013 Long-Term Incentive Plan.
|
1.
|
I have reviewed this Annual Report on Form 10-K for the period ended December 31, 2019, of ION Geophysical Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 6, 2020
|
|
/s/ Christopher Usher
|
|
|
Christopher Usher
|
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this Annual Report on Form 10-K for the period ended December 31, 2019, of ION Geophysical Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 6, 2020
|
|
/s/ Mike Morrison
|
|
|
Mike Morrison
|
|
|
Executive Vice President and Interim Chief Financial Officer
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: February 6, 2020
|
|
/s/ Christopher Usher
|
|
|
Christopher Usher
|
|
|
President and Chief Executive Officer
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: February 6, 2020
|
|
/s/ Mike Morrison
|
|
|
Mike Morrison
|
|
|
Executive Vice President and Interim Chief Financial Officer
|