Fugro, Kelman, Veritas results

Tough times continue for the geophysicists. But Veritas’ CEO thinks spending ‘may be picking up’.

Fugro expects profits for 2003 (net result before amortization of goodwill) of ‘at least’ €40 million—down from €72.2 million in 2002. Turnover for the year is forecast at €850 million (€946 million in 2002). The weak US dollar explains most of the decline in turnover.


A ‘strengthening’ order book observed in the third quarter has faltered recently. Fugro blames weak market conditions resulting in pressure on the margins of several activities. While clients’ investments in the oil and gas sector are increasing (in dollar terms), this has not yet resulted in more work for oil service companies like Fugro. Overcapacity in the seismic market continues, but Fugro’s global positioning activity performs well.


Kelman Technologies Inc (KTI) has announced a 30% third quarter operating net income improvement to $835,000. KTI president and CEO David Richard commented, “Third quarter results are positive in spite of a changing seismic market. Our investment in R&D offers our clients leading edge software tools. We have also expanded facilities and computer capacity in the U.S. market. We believe these investments will be rewarded in the coming quarters.”


Veritas DGC’s results for first fiscal quarter ended October 31, 2003 show revenues as down to $104 million. 2002 first quarter net income of $1.6 million has turned into a $26 million loss in 2003. The loss includes a $22 million ‘catch-up’ adjustment relating to changes in multi-client amortization. CEO Dave Robson commented, “We are disappointed with activity levels in the seismic industry. These results reflect the current lackluster spending by our customers. While there are signs that seismic spending may finally be beginning to pick up, we are hesitant to forecast any significant improvement in the near term.”

This article originally appeared in Oil IT Journal 2003 Issue # 12.

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