Viridien (VIRI) Q2 2024 earnings summary

Executive summary

• The company rebranded from CGG to Viridien, marking a strategic shift toward advanced technology, digital solutions, and expansion into low-carbon, minerals, and high-performance computing markets.

• Strong H1 2024 performance in Geoscience and Earth Data (DDE), with robust order intake and multiclient project pipeline extending into 2025, while Sensing & Monitoring (SMO) lagged due to market cycles and absence of mega crew sales.

• Management prioritizes cash generation, with net cash flow for H1 2024 at $24 million, a significant improvement from $(78) million in H1 2023, and a target of approximately $100 million in 2025.

• Major litigation settlement in India provided over $30 million net of tax and fees, supporting improved cash flow and funding for the Laconia project.

• Operational turnaround and transformation plan in SMO underway to address market volatility, reduce costs, and improve profitability.

Financial highlights

• H1 2024 revenue rose 7% year-over-year to $532 million; Q2 revenue was $258 million, down 10% year-over-year.

• Adjusted EBITDA for H1 2024 was $200 million, up 17% year-over-year; Q2 adjusted EBITDA was $94 million, down 10% year-over-year.

• Net income for H1 2024 was $32 million, up 39% year-over-year; Q2 net income was $35 million.

• Net cash flow for H1 2024 was $24 million, a significant improvement from $(78) million in H1 2023.

• Liquidity at end of Q2 was $430 million, including $90 million undrawn revolving credit facility.

Outlook and guidance

• Full-year 2024 targets for revenue, EBITDA, and net cash flow are reiterated, with revenue expected to be in line with 2023.

• Earth Data CapEx guidance increased to $230–250 million to fund the Laconia project.

• New businesses projected to grow over 30% in 2024.

• Net cash flow for 2024 anticipated to match 2023, with ONGC settlement offsetting higher capex.

• 2025 net cash generation targeted at ~$100 million; $300 million available for debt buyback or refinancing.