(AOF) – Sercel, the Sensing & Monitoring division of CGG, has completed the acquisition of the software business of ION Geophysical Corporation (“ION”). This acquisition allows Sercel to complete its range of services and software but also to diversify into simultaneous offshore operations thanks to its Marlin product. Sercel will operate this new set of technologies as a business unit and the product portfolio will be maintained as is.
Emmanuelle Dubu, CEO of Sercel, said: “We are delighted that the software division of ION is joining the Sercel group and we welcome the teams with enthusiasm. This acquisition is a great opportunity to expand our offer and continue to develop our diversification opportunities with value-added products such as Marlin”.
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Key points
– World leader in geosciences;
– Sales of $949 million, 80% of which come from the Geoscience branch and the rest from the Multi-client and equipment divisions;
– “People, data, technology” business model: sustainability of the group through positive self-financing whatever the market conditions thanks to “asset-light”, reinforcement in activities with strong self-financing generation, balance of balance sheet and availability and diversification in the energy transition;
– Split capital, Sophie Zurquiyah being general manager and Philippe Salle chairman of the 11-member board of directors;
– Healthy but rather strained balance sheet with net debt of $866m against $1bn in equity and $419m in cash
Challenges
– 2025 strategy of transformation into a technology company, with leading positions in basement imaging, cloud, data mining, sensors and acquisition systems: annual revenue growth of 13% / turnover split between monitoring & observation for 37%, digital science for 35% and energy transition;
– Innovation strategy at the source of 30% of annual turnover, boosted by R&D accounting for 11% of turnover, focused on computing power;
– Environmental strategy with 2 deadlines, 2030 and 2050: 50% reduction in CO2 emissions (vs 2020) then total neutrality, increase in the rate of use of renewable energies to 50% then 100 (vs 30% in 2020), efficiency of energy use, launch of credit facilities aligned with ESG criteria;
– Impact of investments in computing capacity and partnerships in hydrogen and decarbonization.
Challenges
– 2022 objective: 10% revenue growth, operating margin of 39 to 40%, €310 million and industrial and R&D investments of around €70 million;
– Abolition of the dividend.
Growing global demand
The IEA (International Energy Agency) estimates that global demand should stand at 99.4 Mb/d (million barrels per day) for 2022, a level slightly revised upwards due to stronger growth. stronger than expected in March and April. However, this remains 1 Mb/d below 2019 levels. From 2023 the IEA forecasts that global oil demand should exceed pre-Covid pandemic levels, driven by Chinese demand. The latter has been strongly affected by the serious disruptions linked to Covid-19 this year. Next year, the rebound in Chinese demand will more than offset a slowdown in OECD countries. In the medium term, the strong recovery in air traffic is supporting oil demand, with an increasingly evident dynamic in air travel in Europe and North America, underlines the IEA.