PSD.to - Pulse Seismic

[Guest notorious546]

Final numbers came out wasn't much in release other than what is below. M&A outlook could be interesting for some people but to me it's just too hard to get a reasonable idea as to what could happen on that front.

 

The advantage of Pulse's low cost structure is that the Company requires only $7.5 million of data library sales per year to cover its cash operating and interest costs at the current debt level. Therefore, for the remainder of 2015, an additional $11.0 million of data library sales would be sufficient to cover these cash costs, and continue to pay the quarterly dividend.

[KCLarkin]

Anyone have news on this? Up 14% today.

[Guest notorious546]

that 14% move was on some really small volume if i remember properly. could have been a leak of this release which came out yesterday.

http://www.pulseseismic.com/investors/news-releases/#prettyPhoto122621/0/

 

i almost think the company makes a better short than a long right now, trades at 12x sales, spending pretty much in decline/flat for industry, visibility on revenues is quite low given tie-in to M&A. only positive i've heard lately for the sector is FID for Pacific NW LNG project, quite long dated to have an impact though. 

 

Pulse Seismic Inc. ("Pulse" or "the Company") is pleased to announce it has signed a $5.1 million seismic data licensing agreement, resulting in total seismic data library sales of $6.2 million so far for the second quarter of 2015. The sale brings year-to-date seismic data library sales to $7.5 million.

 

"This significant sale makes Pulse's year-to-date data library sales revenue sufficient to cover the Company's cash operating and interest costs for the full year," stated Neal Coleman, Pulse's President and CEO. "Although low commodity prices have reduced traditional seismic data library sales, we are pleased to see corporate transactions in the oil and gas producing sector which are leading to significant transactional data library sales revenue."

 

The agreement announced today is a transactional seismic data licensing sale. The licensed data is spread throughout the Deep Basin region of the Western Canada Sedimentary Basin. As discussed in Pulse's annual report for the year ended December 31, 2014, transactional sales are forming an increasing proportion of the Company's overall revenue, with traditional sales having declined due to reduced field capital spending by oil and natural gas producers.

[Guest notorious546]

q3/15 results out this AM.

 

• Seismic data library sales for the third quarter of 2015 decreased to $4.7 million from $14.5 million for the comparable period in 2014. Seismic data library sales for the nine months ended September 30, 2015 were $12.5 million compared to $27.4 million for the comparable period of 2014;

• Total seismic revenue was $15.7 million for the nine months ended September 30, 2015 compared to $27.4 million for the nine months ended September 30, 2014. There was one participation survey completed during the first quarter of 2015 which generated $3.2 million of participation survey revenue;

• In the nine-month period ended September 30, 2015 Pulse purchased and cancelled, through its normal course issuer bid, a total of 865,100 common shares at a total cost of approximately $2.4 million (at an average cost of $2.72 per common share including commissions);

• At September 30, 2015 Pulse had total debt(b) of $1.5 million and cash of $845,000, The debt balance was repaid on October 6 upon the collection of accounts receivable. The $50.0 million revolving credit facility is undrawn and  fully available to the Company;

 

 

[Guest notorious546]

Pulse Seismic Inc. ("Pulse" or "the Company") is pleased to announce the acquisition of a 2D seismic data library at an attractive valuation.

 

The acquisition closed on January 26, 2016 adding approximately 107,000 net kilometres of 2D seismic data and 58 net square kilometres of 3D seismic data, increasing Pulse's 2D seismic data library by over 30 percent from approximately 340,000 net kilometres to approximately 447,000 net kilometres. The acquisition includes data spread throughout the Western Canada Sedimentary Basin and is complementary to Pulse's existing data.

The purchase price of $3.65 million has been funded through the issuance of 669,643 Pulse common shares valued at approximately $2.24 per share, based on the 10 day volume weighted average price of the shares on the Toronto Stock Exchange following close of trading on January 21, 2016, plus $2.15 million in cash. The cash portion was provided from Pulse's cash flow and will not require incurring debt. Following the acquisition, Pulse remains debt-free and has access to a three year, $30 million revolving credit facility with a banking syndicate led by TD Bank and including ATB Financial.

 

"The acquisition advances Pulse's strategy of growth through the addition of high-quality seismic data at valuations that meet our criteria," commented Neal Coleman, Pulse's President and CEO. "We are pleased that Pulse's financial discipline and strong balance sheet enables the Company to conduct acquisitions in the current economic climate."

 

The data was originally shot in the 1970s through 1990s and fits the oil and natural gas industry's continuing need for 2D data for exploratory purposes. In 2015, $6.1 million or 29 percent of Pulse's $21.1 million in data library sales revenue came from the licensing of 2D data.

 

This acquisition was completed in order to improve Pulse's competitive position for the long term. As industry capital spending and field activities go up and down along with business conditions and opportunities, Pulse will continue to focus on generating as much data library sales, cash EBITDA and shareholder free cash flow per share as conditions allow, while seeking opportunities to grow.

 

"The Company's proven approach to capital allocation – investment in capital programs (participation surveys and dataset acquisitions that meet key criteria), purchase of Pulse shares and prudent management of the revolving credit facility – will continue to guide Pulse's business throughout 2016," added Coleman.

 

[Guest notorious546]

YEAR END 2015 CONFERENCE CALL

Pulse will hold a conference call and live audio webcast on Friday, March 4, 2016 at 11:00 a.m. MST (1:00 p.m. EST) where Neal Coleman, President and CEO and Pamela Wicks, VP Finance and CFO will discuss the Company's 2015 results. A question-and-answer period will follow an update on the Company's strategy and outlook.

To participate please dial 587-880-2171 (local – Calgary) or 1-888-390-0546 (toll free – North America) approximately 10 minutes before the commencement of the call. To listen to the webcast of the conference call please visit the Company's website at www.pulseseismic.com.

OUTLOOK

Pulse's short-term outlook is more cautious than one year ago. The Company's first quarter seismic data library sales are likely to be weaker than last year's very low level, and traditional sales for the year could well be lower than in 2015.

So far in 2016, oil and natural gas prices remain weaker than one year ago and mineral lease auctions or "land sales" in Alberta and B.C. are at record lows. The Canadian Association of Oilwell Drilling Contractors forecasts that rig utilization in 2016 will average only 22 percent, with an average of only 159 out of western Canada's industry fleet of well over 700 rigs deployed. In late January, the Petroleum Services Association of Canada lowered its 2016 drilling forecast to 4,900 wells, compared to 5,300 wells in 2015 and 11,500 wells in 2014. All of this is suggestive of low traditional seismic data sales.

Prospects have, however, improved for a faster pace of merger and acquisition activity. With commodity prices remaining low and cash flows among E&P companies widely expected to decline or become negative, causing debt ratios to increase sharply, banks are expected to strongly encourage their borrowers to narrow bid-ask spreads and close transactions to create larger, more viable companies. Following a year of surprisingly low M&A spending and weak deal-flow, one research report stated that by mid-January 2016 there were 49 asset packages being marketed, covering over 4 million acres and 250,000 boe per day of production.

More M&A activity will create favourable conditions for additional transaction-based sales. The unpredictability of transaction-based sales, however, means that Pulse will continue to lack visibility as to its 2016 revenues. Corporate transactions are a necessary but not sufficient condition to generate seismic data relicensing fees; generating transaction-based sales depends on the nature of the underlying corporate transaction and on the acquisitor's plans for the assets in question.

With its annual cash costs of approximately $6.0 million, low financing costs and no dividend, Pulse can continue to generate cash EBITDA and shareholder free cash flow at low revenue while buying back additional shares and maintaining the financial flexibility to grow its seismic data library. Pulse's revised $30.0 million credit facility is undrawn as of this date and includes an accordion feature for expansion to $70.0 million.

Pulse's long-term goal is to become Western Canada's largest licensable data library. The Company's history demonstrates that its revenues could accelerate at any time, and could increase significantly with virtually no increase in operating costs, making Pulse a high-margin business under even modestly positive industry conditions.

[Guest notorious546]

I am planning on attending the AGM this friday if anyone has any questions they'd like me to ask.

[Guest notorious546]

I am planning on attending the AGM this friday if anyone has any questions they'd like me to ask.

 

it is actually in may.

 

also, where can i find the motley fool interview? i heard mgmt recently did one with them

[Liberty]

Haven't looked at this in a while.. Trading at 91 cents, $52m market cap, trading about where it was in 2003.

 

Another business model that looked great on paper (70% FCF margins a while ago, no capex, etc), but the flaw was that it was operating on top of an industry that was very unpredictable and tied to commodity prices.

[bskptkl]

Haven't looked at this in a while.. Trading at 91 cents, $52m market cap, trading about where it was in 2003.

 

Another business model that looked great on paper (70% FCF margins a while ago, no capex, etc), but the flaw was that it was operating on top of an industry that was very unpredictable and tied to commodity prices.

Yep - long time bag holder here...