Geospace Technologies Closes Ocean Bottom Node Purchase Contract With Estimated Value of $10.5 Million

Rhea-AI Summary

Geospace Technologies (NASDAQ: GEOS) has announced the sale of OBX-750E seabed ocean bottom wireless seismic data acquisition nodes to SAExploration, valued at an estimated $10.5 million. SAExploration exercised a purchase option from an existing rental agreement, recognizing the long-term value of owning these robust shallow water nodes.

Geospace Technologies, a leading innovator in marine seismic systems, offers various ocean-bottom wireless seismic data acquisition node systems, including the Aquanaut™ for depths exceeding 3,048 meters and the Mariner™ for shallow depths up to 750 meters. These systems are designed to provide cost savings through improved logistics, operations, maintenance, and repair over their lifetime.

Positive

• Sale of OBX-750E nodes to SAExploration with an estimated value of $10.5 million
• Conversion of a rental agreement to a purchase, indicating customer satisfaction and long-term commitment
• Geospace's innovative product offerings designed for cost-effective, long-term use in various marine environments

Negative

• None.

Financial Analyst

The $10.5 million sale of OBX-750E nodes to SAExploration is a positive development for Geospace Technologies. This deal demonstrates the company's ability to convert rental agreements into outright sales, potentially improving cash flow and reducing inventory costs. The transaction highlights the attractiveness of Geospace's ocean bottom node technology in the marine geophysical services market.

However, investors should note that while this sale is significant, it may not dramatically alter Geospace's financial position. The company's revenue for the fiscal year 2022 was $142.5 million, making this deal represent about 7.4% of annual revenue. It's a solid win, but not a game-changer. The long-term impact will depend on Geospace's ability to secure similar deals and expand its market share in the seismic data acquisition sector.

Tech Expert

Geospace's OBX-750E nodes represent cutting-edge technology in seabed seismic data acquisition. The sale to SAExploration underscores the industry's shift towards wireless, nodal systems for marine surveys. These nodes offer significant advantages over traditional towed streamer systems, including improved data quality in shallow waters and around obstacles.

The mention of Aquanaut™ and Mariner™ systems shows Geospace's commitment to innovation. The Aquanaut's ability to operate at depths over 3,000 meters for up to 200 days is particularly impressive, potentially opening up new exploration opportunities in ultra-deepwater environments. This technological edge could be a key differentiator for Geospace in the competitive seismic equipment market, potentially driving future growth and market share gains.

Market Research Analyst

This sale reflects a broader trend in the seismic exploration market towards more efficient and flexible data acquisition systems. The transition from rental to purchase indicates growing confidence in the long-term viability of ocean bottom node technology. It also suggests that marine geophysical service providers like SAExploration are seeing increased demand for their services, possibly signaling a recovery in offshore exploration activities.

However, the seismic equipment market remains cyclical and tied to oil prices. While this deal is positive, investors should monitor global energy trends and exploration budgets of major oil and gas companies for a comprehensive view of Geospace's growth prospects. The company's ability to diversify its product portfolio and customer base will be important for long-term stability in this volatile market.

HOUSTON--(BUSINESS WIRE)-- Geospace Technologies Corporation (NASDAQ: GEOS) today announced the sale of OBX-750E seabed ocean bottom wireless seismic data acquisition nodes to SAExploration, an international marine geophysical services provider. Based on current contract terms, the value of the agreement is estimated at $10.5 million. SAExploration exercised an option in the Company’s rental agreement to purchase the OBX-750E nodes under this contract.

“We appreciate SAE’s recognition of the long-term value provided through ownership of our robust shallow water ocean bottom nodes,” said Walter R. Wheeler, President and CEO, Geospace Technologies. “By exercising the purchase option in an existing rental contract, SAE gains the ability to cost effectively provide high quality data to their clients for years to come.”

As a leading innovator and manufacturer of marine seismic systems, Geospace Technologies offers ocean-bottom wireless seismic data acquisition node systems, permanent reservoir monitoring systems, and marine streamer accessories. The Company’s most recent seabed node offerings were designed to provide savings over the lifetime of ownership through improved logistics, operations, maintenance and repair. The Aquanaut™ is designed for extended-duration seabed ocean bottom seismic data acquisition. These nodes can be deployed in depths exceeding 3,048 meters with continuous recording for up to 200 days. The Mariner™ is designed for extended-duration seabed ocean bottom seismic data acquisition, ideally deployed at shallow depths down to 750 meters with continuous recording for up to 70 days.

About SAExploration

SAE is an international oilfield services company offering a full range of vertically-integrated seismic data acquisition and logistical support services throughout North America, South America, Asia Pacific, Africa and the Middle East. In addition to the acquisition of 2D, 3D, time-lapse 4D and multi-component seismic data on land, in transition zones and offshore in depths reaching 3,000 meters, SAE also provides in-house logistical support services, such as program design, planning and permitting, camp services and infrastructure, surveying, drilling, environmental assessment and reclamation, and community relations. SAE operates crews around the world, performing projects for its blue-chip customer base, including major integrated oil companies, national oil companies and independent oil and gas exploration companies. Headquartered in Houston, Texas, SAE supports its operations through a multi-national presence in the United States, Canada, Peru, Colombia, Bolivia, Malaysia, and Singapore. For more information, visit SAE's website at www.saexploration.com.

About Geospace Technologies

Geospace Technologies is a global technology and instrumentation manufacturer specializing in vibration sensing and highly ruggedized products which serve energy, industrial, government and commercial customers worldwide. The Company’s products blend engineering expertise with advanced analytic software to optimize energy exploration, enhance national and homeland security, empower water utility and property managers, and streamline electronic printing solutions. With more than four decades of operational excellence, the Company’s more than 600 employees across the world are dedicated to engineering and technical quality. Geospace is traded on the U.S. NASDAQ stock exchange under the ticker symbol GEOS and has been added to the Russell 2000®, Russell 3000®, and Russell Micro-cap®. For more information, visit www.geospace.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240827567717/en/

Caroline Kempf, ckempf@geospace.com, 321.341.9305

Source: Geospace Technologies Corporation

FAQ

What is the estimated value of the OBX-750E node purchase contract for Geospace Technologies (GEOS)?

The estimated value of the OBX-750E node purchase contract for Geospace Technologies (GEOS) is $10.5 million.

Who purchased the OBX-750E seabed ocean bottom wireless seismic data acquisition nodes from Geospace Technologies (GEOS)?

SAExploration, an international marine geophysical services provider, purchased the OBX-750E seabed ocean bottom wireless seismic data acquisition nodes from Geospace Technologies (GEOS).

What are the key features of Geospace Technologies' (GEOS) Aquanaut™ seabed node system?

Geospace Technologies' (GEOS) Aquanaut™ seabed node system is designed for extended-duration seabed ocean bottom seismic data acquisition, can be deployed in depths exceeding 3,048 meters, and can record continuously for up to 200 days.

What is the maximum deployment depth for Geospace Technologies' (GEOS) Mariner™ seabed node system?

Geospace Technologies' (GEOS) Mariner™ seabed node system is designed for shallow depths down to 750 meters.