(Boursier.com) — After its 24% freefall yesterday, CGG timidly recovers 1% to 0.70 euro on the Parisian market this Friday. The stock was penalized yesterday in the wake of results that came out below analysts’ expectations with, in parallel, a downward revision of its 2022 guidance… The title had not experienced such a fall since March 2020.
Among the latest analysts’ notes, Kepler Cheuvreux lowered its target from 1.6 to 1.3 euros while remaining on the buy side.
The oil services group reported a weak quarter due to shifts in customer projects at the end of the year and 2023… It thus recorded over the three months ended at the end of September a turnover from activities of 217 M $, down 20% (-16% pro-forma over one year), against $253.3 million of consensus, and EBITDAs from activities of $77 million, down 35%. Net cash flow was -$78 million over the period, mainly due to $19 million of cash costs related to the purchase of ION Software and $40 million of negative change in working capital and provisions mainly related to the SMO segment.
CGG now anticipates 2022 business revenue of around $900 million, stable year-on-year pro forma… Business EBITDA is expected to be around $380 million, up 10% year-on-year and 15 % pro-forma, materializing an increase in EBITDAs margin from activities to around 42% thanks to a more favorable activity mix. At the start of the year, management was aiming for an increase in business revenue of around 10%, and a business EBITDA margin of around 39-40%… “Despite high oil prices, the resumption of activity seems to be shifting to 2023” commented Portzamparc, who aligned its 2022 forecasts with management guidance and lowered its price target to 0.80 euro while remaining at ‘Keep’. “However, it still seems a little early to reposition itself on the title given the current volatility of its results” prudently advises the analyst.
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