Transformation Plan Intensified, accelerated and implemented in 2014 Resilient second quarter operating income in weak market conditions

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1 -2016 Transfrmatin Plan Intensified, accelerated and implemented in Resilient secnd quarter perating incme in weak market cnditins PARIS, France August 1 st CGG (ISIN: NYSE: CGG), wrld leader in Gescience annunced tday its nn-audited secnd quarter results Transfrmatin Plan intensified and accelerated. Restructuring measures implemented in : Marine fleet reduced t 13 seismic vessels by end. 1 vessel already decmmissined, 1 vessel retired frm the seismic market, 2 vessels derigged and 1 permanently cnverted t surce vessel Nrth American land cntract business dispsed t Gekinetics New Argas set up finalized in the Middle-East Mre than 10% headcunt reductin Strng cst reductin, reinfrced cash management, industrial capex reduced by 10% Operatinal sites clsed dwn in Bergen (Nrway), Nigeria and Venezuela Resilient secnd quarter perating incme in difficult current market envirnment: Revenue at $689m Operating incme at $45m with slid peratinal marine perfrmance EBIT at $31m, including a $(13)m negative cntributin f equity frm investees, mainly related t the Seabed Geslutins JV $230m f nn-recurring charges: $120m (including $96m cash csts) restructuring csts related t the Transfrmatin Plan $74m write-ff related t Seabed activities $37m write-ff related t multi-client library in Brazil Successful refinancing peratins t extend debt maturity: Issue f a 400m High Yield Bnd due 2020 at 5.875% Issue f a US $500m High Yield Bnd due 2022 at 6.875% $57m financial ne-ff csts related t the April debt refinancing Backlg was $1.1bn as f 1 st July : Marine fleet cverage at 97% in Q3 and 40% in Q4 Strategic agreement with Svcmflt t create a marine JV CGG CEO, Jean-Gerges Malcr, cmmented: «Given the current weak market cnditins characterized ntably by the unpredictable capex spending f ur clients, delays in awarding prjects and pressure n prices, we anticipate t remain difficult. In this cntext, CGG has decided t accelerate and intensify its restructuring measures int, dwnsizing the fleet frm 18 t 13 vessels by the end f the year and dispsing f its Nrth America land acquisitin business t Gekinetics. Thanks t the full cmmitment f ur emplyees we managed t deliver resilient prfitability this quarter. 1

2 We anticipate, with this new perimeter, a sequential imprvement in ur results during the secnd half f the year sustained by a typically strng furth quarter. The set f measures put in place during allw us t cnfirm ur bjective f 400 bps Ebit margin imprvement in 2016.» Pst-clsing event: On the 21 st f July, CGG negtiated a ne-year extensin f the French Revlving Credit Facility t maintain the 3 year maturity On the 1 st f August, CGG annunced the dispsal f the Nrth American land cntract business t Gekinetics Secnd Key Figures Befre Nn-Recurring Charges (NRC) In millin $ Secnd 2013 First Secnd Grup Revenue 1, Equipment Acquisitin Gelgy, Gephysics & Reservir (GGR) Eliminatins (194) (249) (288) Grup EBITDAS Operating Incme Grup EBIT Equipment Acquisitin GGR Grup EBIT margin 12% 2% 5% Equipment margin 28% 20% 20% Acquisitin margin 5% -3% 1% GGR margin 26% 22% 21% Net Financial Csts (47) (45) (52) Free Cash Flw (24) (151) (53) Secnd Key Figures After Nn-Recurring Charges (NRC) In millin $ Secnd 2013 First Secnd Grup EBITDAS Operating Incme (186) Grup EBIT (199) Net Financial Csts (47) (45) (109) Incme Taxes (36) (11) (13) Net Incme 36 (39) (325) Nn-recurring charges (11) (1) (230) Cash Flw frm Operatins Free Cash Flw (43) (152) (58) Net Debt 2,170 2,428 2,575 Capital Emplyed 6,868 6,279 6,070 2

3 First Half Key Figures Befre Nn-Recurring Charges (NRC) In millin $ First Half 2013 First Half Grup Revenue 1,902 1,495 Equipment Acquisitin 1,199 1,040 Gelgy, Gephysics & Reservir (GGR) Eliminatins (429) (538) Grup EBITDAS Operating Incme Grup EBIT Equipment Acquisitin 75 (9) GGR EBIT margin 13% 3% Equipment margin 28% 20% Acquisitin margin 6% (1)% GGR margin 28% 21% Net Financial Csts (98) (97) Free Cash Flw (157) (204) First Half Key Figures After Nn-Recurring Charges (NRC) In millin $ First Half 2013 First Half Grup EBITDAS Operating Incme 273 (151) Grup EBIT 279 (181) Net Financial Csts (98) (154) Incme Taxes (62) (24) Net Incme 115 (364) Nn-recurring charges 24 (232) Cash Flw frm Operatins Free Cash Flw (191) (210) Net Debt 2,170 2,575 Capital Emplyed 6,868 6,070 3

4 Implementatin f the Transfrmatin Plan: Rebalanced business prtfli Refrmatting and rebalancing f businesses: Right-sizing f the fleet frm 18 t 13 vessels by end f Nrth American land cntract business dispsed t Gekinetics Cmmercial efficiency: New Argas land set up finalized in the Middle East. The new Argas wned respectively 51% by Taqa and 49% by CGG has enlarged its peratinal ftprint acrss the Gulf Cuntries Agreement with Svcmflt t frm a marine JV Technlgy and innvatin: 1 st deliveries f Sercel 508 XT land acquisitin system Paradigm shift in Gulf f Mexic with the first high quality StagSeis fast track images available and strng interest frm ur custmers Cash and debt management Cst Cntrl: Scaling up acrss the bard with 2.5% reductin f emplyees since January and mre than 10% reductin by end (mre than 1000 emplyees) Strng cst reductin, cash management and capex discipline Three peratinal sites clsed dwn in Nrway, Nigeria and Venezuela Operatinal perfrmance: Availability and prductin rates abve 90% in H1 Excellent custmer feedback in the Welling Reprt n CGG data acquisitin activities Cash management: Refinancing peratins launched in April t push back the mandatry instalments beynd 2019 One year extensin f the French Revlver Credit Facility Capex reductin: 10% industrial capex reductin End f multi-client IBALT prgram in the Gulf f Mexic in Q3 4

5 Secnd Financial Results by Divisin and befre nnrecurring charges Equipment Equipment Secnd 2013 First Secnd Variatin Year-nyear Variatin tquarter In millin $ Equipment Ttal Revenue (23)% (5)% External Revenue (21)% (9)% EBITDAs (40)% (3)% Margin 33% 25% 26% (700)bp 100bp EBIT (46)% (7)% Margin 28% 20% 20% (800)bp 0bp Capital Emplyed (in billin $) NA NA Equipment divisin Ttal Revenue was $196 millin, dwn 23% cmpared t the secnd quarter f 2013 and dwn 5% sequentially. The weakness f the seismic acquisitin market is translating int lwer seismic equipment spending. Nevertheless in this cntext, Sercel is increasing its market share. External sales were $148 millin, dwn 21% and internal sales represented 24% f ttal revenue, dwn 27% as a cnsequence f the CGG s fleet dwnsizing. In June, Sercel was awarded by Argas, ur partner in the Middle East, the channel cunt crew in Saudi Arabia. Interest fr the 508 XT acquisitin system amng ur clients is increasing. In additin t the first tw 508 XT systems being delivered t the industry in June, Sercel annunced at the Eurpean seismic cnventin (EAGE) that a system had been sld t PanAmerican Gephysical fr delivery in July and will be deplyed in Nrth America. During this cnventin, Sercel als launched the new land vibratr G Anywhere Nmad 15, its unique design gives the best mass/baseplate rati available n the market and with a reduced envirnmental ftprint. In Marine, Sercel launched QuietSea, its new passive acustic mnitring (PAM) system designed t detect the presence f marine mammals during seismic peratins which is set t revlutinize PAM within the seismic industry. Equipment divisin EBITDAs was $50 millin, a margin f 26%. Equipment divisin EBIT was $39 millin, a margin f 20%. The margin was impacted by lwer revenue, by an unfavrable /$ exchange rate as in Q1 and by pressure n prices. Equipment divisin Capital Emplyed was $0.8 billin at the end f June. 5

6 Acquisitin Acquisitin Secnd 2013 First Secnd Variatin Year-nyear Variatin tquarter In millin $ Acquisitin Ttal Revenue (21)% (14)% External Revenue (49)% (32)% Ttal Marine (20)% (10)% Ttal Land and Airbrne Acquisitin (21)% (30)% EBITDAs (21)% 19% Margin 20% 14% 20% 0bp 600bp Operating Incme (41)% 1556% EBIT 28 (15) 6 (78)% (142)% Margin 5% (3)% 1% (400)bp 400bp Capital Emplyed (in billin $) NA NA Acquisitin divisin Ttal Revenue was $481 millin, dwn 21% year-n-year and dwn 14% sequentially. In these difficult market cnditins, peratinal perfrmance remained strng in marine with prductin rate at 92%. External revenue was $241 millin. Marine Acquisitin revenue was $407 millin, dwn 20% year-n-year and dwn 10% sequentially. 52% f the fleet was dedicated t multi-client prgrams. Utilizatin rate was at a high level this quarter fr the whle fleet with availability rate at 94% and a prductin rate at 92%. After the Symphny was decmmissined in February, we perated 17 3D vessels including surce vessels this quarter. On the 19 th f June, CGG and Svcmflt signed an agreement t frm a jint venture cmpany dedicated t cnducting high-end 3D marine seismic acquisitin services. The jint venture, t be called Arctic Gephysical Explratin (AGE), will be 51% wned by Svcmflt and 49% wned by CGG. Land and Airbrne Acquisitin revenue was $74 millin, dwn 21% year-n-year and dwn 30% sequentially. This decrease is mainly due t weak market cnditins acrss the regins. Revenue was lw in Airbrne due t reduced mining activity and flat il & gas market. Acquisitin divisin EBITDAs was $95 millin, a margin f 20%. Acquisitin Divisin Operating Incme was at $19 millin with an imprvement in marine acquisitin prfitability sequentially. Acquisitin divisin EBIT was $6 millin a margin f 1% due t the $(13) millin negative cntributin f the equity frm investees (including 40% f the Seabed Geslutins JV). Acquisitin divisin Capital Emplyed was $2.4 billin at the end f June. 6

7 Gelgy, Gephysics & Reservir (GGR) GGR Secnd 2013 First Secnd Variatin Year-nyear Variatin tquarter In millin $ GGR Ttal Revenue (18)% 3% Multi-client (36)% 0% Prefunding % 15% Subsurface Imaging & Reservir % 6% EBITDAs (27)% 0% Margin 59% 55% 53% (600)bp (200)bp EBIT (36)% (3)% Margin 26% 22% 21% (500)bp (100)bp Capital Emplyed (in billin $) NA NA GGR Divisin Ttal Revenue was $300 millin, dwn 18% year-n-year and up 3% sequentially. Multi-client revenue was $128 millin, dwn 36% year-n-year and stable sequentially in the cntext f verall lwer explratin spending and delays in peratins and permitting issues in Brazil. Prefunding revenue was $92 millin up 6% year-n-year and up 15% sequentially. Multi-client cash capex was $175 millin, 53% prefunded and mainly fcused n ur ftprint extensin in mature basins such as the Nrwegian Nrth Sea (Hrda) but als in the Gulf f Mexic with the cntinuatin f ur IBALT prgram. On the 15 th f May, CGG started acquiring a large BradSeis TM 3D multi-client survey prgram in the deep and ultra-deep waters f the Espirit Sant Basin. The prject has received high prefunding frm majr industry players. At the EAGE, CGG annunced the release f the Fast Trax TM prcessed data frm its Deux multi-client IBALT survey cvering 357 blcks in the Gulf f Mexic. The Fast Trax seismic images have been delivered n schedule less than seven mnths after cmpletin f the survey. After-sales revenue was $35 millin, dwn 68% year-n-year and dwn 26% sequentially. This fall is mainly due t ur clients reductin in spending n explratin and seismic activities. Subsurface Imaging & Reservir revenue was $172 millin, up 2% year-n-year and 6% sequentially in line with ur expectatins. Demand fr imaging, reservir services and sftware remains strng. GGR Divisin EBITDAs was $159 millin, a margin f 53%. GGR Divisin EBIT was $62 millin, a margin f 21%. The multi-client depreciatin rate amunted t 62%, leading t a $1,012 millin Net Bk Value at the end f June. GGR Divisin Capital Emplyed was $2.9 billin at the end f June. 7

8 Secnd Financial Results Grup Ttal Revenue was $689 millin, dwn 33% year-n-year and dwn 15% sequentially. This breaks dwn t 22% frm the Equipment divisin, 35% frm the Acquisitin divisin, and 43% frm the GGR divisin. Secnd 2013 First Secnd Variatin Year-nyear Variatin quartertquarter In millin $ Grup Ttal Revenue 1, (33)% (15)% Equipment (23)% (5)% Acquisitin (21)% (14)% GGR (18)% 3% Eliminatins (194) (249) (288) NA NA Grup EBITDAs was $194 millin, a margin f 28%. After NRC, Grup EBITDAs was 98 millin, a margin f 14%. Variatin Variatin Secnd First Secnd Year-nyeat * quarter In millin $ Grup EBITDAs (42)% 2% Margin 32% 23% 28% (400)bp 500bp Equipment (40)% (3)% Acquisitin (21)% 19% GGR (27)% 0% Eliminatins (75) (86) (97) NA NA Crprate (14) (15) (13) NA NA Nn-recurring charges (10) (1) (96) NA NA *nn-recurring items linked t Fugr Grup Operating Incme was $45 millin, a margin f 6%. After NRC, Grup Operating Incme was $(186) millin. Grup EBIT was $31 millin, a margin f 5%. After NRC, Grup EBIT was $(199) millin. Variatin Variatin Secnd First Secnd Year-nyeat-quarter * In millin $ Grup EBIT (76)% 62% Margin 12% 2% 5% (700)bp 300bp Equipment (46)% (7)% Acquisitin 28 (15) 6 (78)% (142)% GGR (36)% (3)% Eliminatins (52) (54) (61) NA NA Crprate (15) (17) (14) NA NA Nn-recurring charges (11) (1) (230) NA NA *nn-recurring items linked t Fugr 8

9 Ttal Nn-recurring charges were $230 millin: Restructuring csts f $(120) millin (including $96 millin cash csts) due t the acceleratin and scaling up f the Transfrmatin plan acrss the bard $(74) millin assets write-ff related t the Seabed activities (mainly the investment in the Seabed Geslutins JV in line with the annuncement f Fugr, the majr sharehlder, n July 10 th ) $(37) millin write-ff f Brazilian surveys acquired with cnventinal technlgy in This is due t a very pr likelihd f realizing revenues in the next tw years given the current Brazilian cntext Befre NRC, Financial Charges were $(52) millin: Cst f debt was $(51) millin. The ttal amunt f interest paid during the quarter was $(60) millin Other financial items were negative at $(1) millin After NRC, Financial Charges were $(109) millin: $(57) millin ne-ff csts attached t the April refinancing Plan: $(36) millin nn-cash including fr $(25) millin the cst f the cnvertible bnd equity cmpnent write-ff $(21) millin cash cvering the $(12) millin cnvertible bnd repurchase cst and the $(9) millin high yield bnd call premiums Cst f debt was $(62) millin. The ttal amunt f interest paid during the quarter was $(60) millin Other financial items were negative at $(47) millin including the $(38) millin f nn-recurring charges related t cnvertible bnd repurchase and the $(9) millin high yield bnd call premiums After NRC, taxes were $(16) millin including the $(3) millin unfavrable impact f deferred tax n currency cnversin Grup Net Incme was $(325) millin. After minrity interests, Net Incme attributable t the wners f CGG was a lss f $(327) millin / (238) millin. EPS was negative at $(1.85) / (1.34). Cash Flw Cash Flw frm peratins, after nn-recurring charges, was $263 millin cmpared t $204 millin fr the secnd quarter

10 Glbal Capex was $262 millin, up 38% cmpared t the secnd quarter Industrial capex was $63 millin, excluding the $9 millin related t Sercel s lease pl Research & Develpment capex was $15 millin Multi-client cash capex was $175 millin, up 64% year-n-year related t the pursuit f ur IBALT prgram in the Gulf f Mexic and a prgram ffshre Brazil Secnd 2013 First Secnd In millin $ Capex Industrial R&D Multi-client Cash Marine MC Land MC Free Cash Flw After the payment f interest expenses during the quarter and Capex, free cash flw was negative at $(53) millin. Including NRC, Free Cash Flw was negative at $(58) millin. 10

11 Secnd Cmparisns with Secnd 2013 Cnslidated Incme Statements Secnd Quater 2013 First Secnd In Millin $ Exchange rate eur/dllar Operating Revenue Equipment Acquisitin GGR Eliminatin (194.9) (249.2) (287.8) Grss Margin after NRC Operating Incme befre NRC Equity frm Investments befre NRC (4.5) (16.5) (13.2) EBIT befre NRC Equipment Acquisitin 28.0 (15.0) 6.3 GGR Crprate and Eliminatins (67.1) (70.8) (75.0) NRC (10.8) (1.3) (230.5) EBIT after NRC (199.1) Net Financial Csts (46.7) (45.1) (109.3) Incme Taxes (36.3) (10.9) (13.0) Deferred Tax n Currency Translatin 1.7 (1.0) (3.2) Net Incme 35.7 (39.0) (324.6) Earnings per share in $ 0.20 (0.23) (1.85) Earnings per share in 0.15 (0.17) (1.34) EBITDAs after NRC Equipment Acquisitin GGR Crprate and Eliminatins (88.2) (101.0) (110.4) NRC (9.6) (1.1) (96.0) EBITDAs befre NRC Industrial Capex (incl. R&D Capex) MC Cash Capex

12 First Half Financial Results Grup Ttal Revenue was $1.495 billin dwn 21% cmpared t 2013 due t weakening market cnditins. This breaks dwn t 21% frm the Equipment divisin, 40% frm the Acquisitin divisin and 39% frm the GGR divisin. First Half 2013 First Half In millin $ Grup Ttal Revenue 1,902 1,495 Equipment Acquisitin 1,199 1,040 GGR Eliminatins (429) (538) Grup EBITDAs was $383 millin dwn 37% and representing a 26% margin. After NRC, Grup EBITDAs was $286 millin, a margin f 19%. *nn-recurring items linked t Fugr First Half 2013* First Half In millin $ Grup EBITDAs Margin 32% 26% Equipment Acquisitin GGR Eliminatins (157) (183) Crprate Csts (24) (29) Nn-recurring charges 31 (97) Grup Operating Incme was $80 millin, a margin f 5%. After NRC, Grup Operating Incme was $(151) millin. Grup EBIT was $51 millin dwn 80%, a margin f 3%. After NRC, Grup EBIT was $(181) millin: The grup EBIT was impacted by weak market cnditins and lwer client spending acrss the bard. In Equipment, the 20% decline in seismic equipment vlume has a direct impact n the margin which reached 20%. In Acquisitin, H activity was buyant whereas H1 suffered frm pricing pressure and a reduced fleet perimeter. In GGR, H1 was characterized by lw multi-client sales cmpared t H which included the $20 millin Spectrum capital gain. The prfitability remains high despite lwer after-sales. Equipment EBIT margin was at 20%. Acquisitin EBIT margin was at (1)%. GGR EBIT margin was at 21%. First Half 2013* First Half In millin $ Grup EBIT Margin 13% 3% Equipment Acquisitin 75 (9) GGR Eliminatins (107) (115) Crprate Csts (29) (31) Nn-recurring charges 24 (232) *nn-recurring items linked t Fugr 12

13 Befre NRC, Financial Charges were $(97) millin: The cst f debt was $(99) millin, while the ttal amunt f interest paid was $(72) millin Other financial items were psitive at $2 millin mainly related t a favrable exchange rate impact After NRC, Financial Charges were $(154) millin: The cst f debt was $(110) millin, while the ttal amunt f interest paid was $(72) millin Other financial items were negative at $(44) millin including the $(38) millin f nn-recurring charges related t cnvertible bnd repurchase and the $(9) millin high yield bnd call premiums After NRC, taxes were $(28) millin. Grup Net Incme was $(364) millin. After minrity interests, Net Incme attributable t the wners f CGG was negative at $(367) millin/ (267) millin. EPS was negative at $(2.07) / (1.51). Cash Flw Cash Flw frm peratins, after nn-recurring charges, was $381 millin including a $64 millin change in wrking capital. Glbal Capex was $519 millin ver the first half f. Industrial capex was $141 millin, excluding the $16 millin f Sercel s lease pl Research & Develpment capex was $31 millin Multi-client cash capex was $331 millin, arund 60% f the $ millin guidance First Half 2013 First Half In millin $ Capex Industrial R&D Multi-client Cash Marine MC Land MC Free Cash Flw After the payment f interest paid during the first half and Capex, free cash flw was negative at $(210) millin and at $(204) millin excluding the cash impact f the NRC. 13

14 Balance Sheet Debt Management: CGG cnducted tw refinancing transactins in April t extend the average debt maturity perids frm 4 t apprximatively 6 years: A 400 millin Eurpean High Yield Bnd at 5.875%, the lwest rate ever btained fr a High Yield Bnd issued by CGG, due 2020: The net prceeds are dedicated t the 100% repurchase f the 360 millin OCEANE Cnvertible Bnd due January 2016 and the reimbursement f the 2015 installment f the Fugr Vendr Lan. A $500 millin High Yield Bnd at 6.875% due 2022 The net prceeds are dedicated t the reimbursement f all the 9.5% Senir Ntes due May 2016, fr a ttal principal amunt f $225 millin, as well as a prtin f the 7.75% Senir Ntes due May 2017, fr a ttal principal amunt t $400 millin. On the 21 st f July, CGG negtiated a ne-year extensin f the French Revlving Credit Facility t maintain the 3 year maturity Net Debt t Equity Rati: Grup grss debt was $2.960 billin at the end f June. Available cash was $385 millin and Grup net debt was $2.575 billin. Net debt t equity rati, at the end f June, was 75%. 14

15 First Half Cmparisns with First Half 2013 Cnslidated Incme Statements In Millin $ First Half 2013 First Half Exchange rate eur/dllar Operating Revenue Equipment Acquisitin GGR Eliminatin (428.5) (537.0) Grss Margin after NRC Operating Incme befre NRC Equity frm Investments befre NRC 6.1 (29.7) EBIT befre NRC Equipment Acquisitin 75.2 (8.7) GGR Crprate and Eliminatins (136.3) (145.7) NRC 23.8 (231.8) EBIT after NRC (181.1) Net Financial Csts (98.0) (154.4) Incme Taxes (61.6) (23.9) Deferred Tax n Currency Translatin (5.0) (4.2) Net Incme (363.6) Earnings per share in $ 0.63 (2.07) Earnings per share in 0.48 (1.51) EBITDAs after NRI Equipment Acquisitin GGR Crprate and Eliminatins (181.9) (211.4) NRC 31.4 (97.1) EBITDAs befre NRC Industrial Capex (incl. R&D Capex) MC Cash Capex

16 Other Infrmatin An English language analysts cnference call is scheduled at 9:00 am (Paris time) 8:00 am (Lndn time) T fllw this cnference, please access the live webcast: Frm yur cmputer at: A replay f the cnference will be available via the webcast n CGG website at: Fr analysts, please dial 5 t 10 minutes prir t the scheduled start time the fllwing numbers: France call-in UK call-in Access cde +33 (0) (0) Abut CGG CGG ( is a fully integrated Gescience cmpany prviding leading gelgical, gephysical and reservir capabilities t its brad base f custmers primarily frm the glbal il and gas industry. Thrugh its three cmplementary business divisins f Equipment, Acquisitin and Gelgy, Gephysics & Reservir (GGR), CGG brings value acrss all aspects f natural resurce explratin and explitatin. CGG emplys ver 9,500 peple arund the wrld, all with a Passin fr Gescience and wrking tgether t deliver the best slutins t its custmers. CGG is listed n the Eurnext Paris SA (ISIN: ) and the New Yrk Stck Exchange (in the frm f American Depsitary Shares. NYSE: CGG). Cntacts Grup Cmmunicatins Christphe Barnini Tel: : invrelparis@cgg.cm Investr Relatins Catherine Leveau Tel: : invrelparis@cgg.cm 16

17 CONSOLIDATED FINANCIAL STATEMENTS June 30, 17

18 CONSOLIDATED BALANCE SHEET Amunts in millins f U.S.$, unless indicated June 30, (unaudited) December 31, 2013 ASSETS Cash and cash equivalents Trade accunts and ntes receivable, net Inventries and wrk in prgress, net Incme tax assets Other current assets, net Assets held fr sale, net Ttal current assets 2, ,354.0 Deferred tax assets Investments and ther financial assets, net Investments in cmpanies under equity methd Prperty, plant and equipment, net 1, ,557.8 Intangible assets, net 1, ,271.6 Gdwill, net 2, ,483.2 Ttal nn current assets 5, ,908.8 TOTAL ASSETS 7, ,262.8 LIABILITIES AND EQUITY Bank verdrafts Current prtin f financial debt Trade accunts and ntes payable Accrued payrll csts Incme taxes liability payable Advance billings t custmers Prvisins current prtin Other current liabilities Ttal current liabilities 1, ,543.5 Deferred tax liabilities Prvisins nn current prtin Financial debt 2, ,496.1 Other nn current liabilities Ttal nn current liabilities 2, ,829.2 Cmmn stck 286,777,098 shares authrized and 176,065,192 shares with a 0.40 nminal value issued and utstanding at June 30, and 176,890,866 at December 31, Additinal paid in capital 3, ,180.4 Retained earnings ,273.9 Other reserves (39.3) (46.1) Treasury shares (20.6) (20.6) Net incme (lss) fr the perid attributable t the wners f CGG (366.9) (698.8) Cumulative incme and expense recgnized directly in equity (7.6) (7.6) Cumulative translatin adjustment Equity attributable t wners f CGG SA 3, ,799.9 Nn cntrlling interests Ttal equity 3, ,890.1 TOTAL LIABILITIES AND EQUITY 7, ,

19 UNAUDITED INTERIM CONSOLIDATED STATEMENT OF OPERATIONS Six mnths ended June 30, Amunts in millins f U.S.$, except per share data r unless 2013 indicated Operating revenues 1, ,902.4 Other incme frm rdinary activities Ttal incme frm rdinary activities 1, ,903.5 Cst f peratins (1,230.2) (1,469.5) Grss prfit Research and develpment expenses, net (54.0) (51.0) Marketing and selling expenses (59.7) (62.9) General and administrative expenses (79.2) (105.2) Other revenues (expenses), net (224.5) 58.4 Operating incme (151.4) Expenses related t financial debt (110.9) (94.1) Incme prvided by cash and cash equivalents Cst f financial debt, net (110.0) (93.1) Other financial incme (lss) (44.4) (4.9) Incme (lss) f cnslidated cmpanies befre incme taxes (305.8) Deferred taxes n currency translatin (4.2) (5.0) Other incme taxes (23.9) (61.6) Ttal incme taxes (28.1) (66.6) Net incme (lss) frm cnslidated cmpanies (333.9) Share f incme (lss) in cmpanies accunted fr under equity methd (29.7) 6.1 Net incme (lss) (363.6) Attributable t : Owners f CGG $ (366.9) Owners f CGG (1) (267.3) 85.1 Nn cntrlling interests $ Weighted average number f shares utstanding 176,905, ,750,616 Dilutive ptential shares frm stck ptins (3) 588,127 Dilutive ptential shares frm perfrmance share plan (3) 611,140 Dilutive ptential shares frm cnvertible bnds (3) (2) Dilutive weighted average number f shares utstanding adjusted when dilutive 176,905, ,949,883 Net incme (lss) per share Basic $ (2.07) 0.63 Basic (1) (1.51) 0.48 Diluted $ (2.07) 0.63 Diluted (1) (1.51) 0.48 (1) Cnverted at the average exchange rate f U.S.$ and U.S.$ per fr the perids ended June 30, and 2013, respectively. (2) Cnvertible bnds had an accretive effect; as a cnsequence, ptential shares linked t thse instruments were nt taken int accunt in the dilutive weighted average number f shares r in the calculatin f diluted incme per share. (3) As ur net result was a lss, stck ptins, perfrmance shares plans and cnvertible bnds had an accretive effect; as a cnsequence, ptential shares linked t thse instruments were nt taken int accunt in the dilutive weighted average number f shares, r in the calculatin f diluted lss per share. 19

20 UNAUDITED INTERIM CONSOLIDATED STATEMENT OF OPERATIONS Three mnths ended June 30, Amunts in millins f U.S.$, except per share data r unless indicated 2013 Operating revenues ,031.7 Other incme frm rdinary activities Ttal incme frm rdinary activities ,032.2 Cst f peratins (557.7) (794.3) Grss prfit Research and develpment expenses, net (27.6) (24.9) Marketing and selling expenses (30.2) (34.5) General and administrative expenses (37.3) (54.2) Other revenues (expenses), net (222.7) (2.8) Operating incme (185.9) Expenses related t financial debt (62.7) (47.2) Incme prvided by cash and cash equivalents Cst f financial debt, net (62.4) (46.8) Other financial incme (lss) (46.9) 0.1 Incme (lss) f cnslidated cmpanies befre incme taxes (295.2) 74.8 Deferred taxes n currency translatin (3.2) 1.7 Other incme taxes (13.0) (36.3) Ttal incme taxes (16.2) (34.6) Net incme (lss) frm cnslidated cmpanies (311.4) 40.2 Share f incme (lss) in cmpanies accunted fr under equity methd (13.2) (4.5) Net incme (lss) (324.6) 35.7 Attributable t : Owners f CGG $ (326.5) 34.9 Owners f CGG (1) (237.8) 26.6 Nn cntrlling interests $ Weighted average number f shares utstanding 176,919, ,719,125 Dilutive ptential shares frm stck ptins (3) 507,561 (3) 611,140 Dilutive ptential shares frm perfrmance share plan Dilutive ptential shares frm cnvertible bnds (1) Crrespnding t the half year amunt in eurs less the first quarter amunt in eurs. (2) Cnvertible bnds had an accretive effect; as a cnsequence, ptential shares linked t thse instruments were nt taken int accunt in the dilutive weighted average number f shares r in the calculatin f diluted incme per share. (3) As ur net result was a lss, stck ptins, perfrmance shares plans and cnvertible bnds had an accretive effect; as a cnsequence, ptential shares linked t thse instruments were nt taken int accunt in the dilutive weighted average number f shares, r in the calculatin f diluted lss per share. (3) (2) Dilutive weighted average number f shares utstanding adjusted when dilutive 176,919, ,837,826 Net incme (lss) per share Basic $ (1.85) 0.20 Basic (1) (1.34) 0.15 Diluted $ (1.85) 0.20 Diluted (1) (1.34)

21 In millins f U.S.$, except fr assets and capital emplyed in billins f U.S.$ GGR UNAUDITED ANALYSIS BY SEGMENT Six mnths ended June 30, 2013 Eliminatins and Other Cnslidated Ttal GGR Acquisitin Equipment Acquisitin Equipment Eliminatins and Other Cnslidated Ttal Revenues frm unaffiliated custmers _ 1, _ 1,902.4 Inter segment revenues _ 90.9 (537.0) _ _ (428.5) _ Operating revenues 1, (537.0) 1, , (428.5) 1,902.4 Depreciatin and amrtizatin (excluding multi client surveys) (230.9) (37.3) (43.2) _ (311.4) (174.6) (30.1) (23.0) _ (227.7) Depreciatin and amrtizatin f multiclient surveys _ (194.6) (194.6) _ (174.0) (174.0) Operating incme (149.9) (145.6) (151.4) (112.5) Share f incme in cmpanies accunted fr under equity methd (1) (28.3) (1.4) (29.7) Earnings befre interest and tax (2) (178.2) (145.6) (181.1) (112.5) Capital expenditures (excluding multi client surveys) (3) (7.0) Investments in multiclient surveys, net cash _ _ Capital emplyed _ _ 6.9 Ttal identifiable assets (1) Share f perating results f cmpanies accunted fr under equity methd were U.S.$(26.2) millin and U.S.$4.8 millin fr the six mnths ended June 30, and 2013, respectively. (2) Fr the six mnths ended June 30,, Acquisitin EBIT includes U.S.$(158.3) millin f nn recurring items: (i) U.S.$(117.4) millin related t the marine and land transfrmatin plan, f which U.S.$(93.5) millin relating t redundancies csts, facilities exit csts and prvisins fr nerus cntracts and U.S.$(23.9) millin impairment f marine fixed equipment; (ii) U.S.$(52.0) millin impairment f ur investment in the cmpany Seabed Geslutins BV accunted fr under equity methd; and (iii) a net gain arising frm the sale f Ardiseis FZCO amunting t U.S.$11.1 millin. GGR EBIT includes a U.S.$(36.7) millin impairment f Brazilian multi client surveys; and redundancies and facilities exit csts fr U.S.$(4.0) millin. GGR EBIT fr the six mnths ended June 30, 2013 included a gain f U.S.$19.8 millin related t the sale f the Cmpany s sharehlding interest in Spectrum ASA. Equipment EBIT includes a U.S.$(21.7) millin impairment f intangible assets. Eliminatins and ther include U.S.$(31.1) millin f general crprate expenses and U.S.$(114.6) millin f intragrup margin. Fr the six mnths ended June 30, 2013, eliminatins and ther included general crprate expenses f U.S.$(29.2) millin, U.S.$(107.4) millin f intra grup margin and U.S.$24.1 millin f nn recurring items related t the acquisitin f Fugr s Gesciences Divisin: (i) a gain f U.S.$84.5 millin related t cntributin f shallw water and OBC assets t ur Seabed jint venture with Fugr; (ii) restructuring csts f U.S.$(37.3) millin related t the acquired vessels frm Fugr; and (iii) acquisitin csts f U.S.$(23.1) millin. (3) Capital expenditures include capitalized develpment csts f U.S.$(31.0) millin and U.S.$(24.2) millin fr the six mnths ended June 30, and 2013, respectively. 21

22 Three mnths ended June 30, 2013 In millins f U.S.$, except fr assets and capital emplyed in billins f U.S.$ GGR Eliminatins and Other Cnslidated Ttal GGR Acquisitin Equipment Acquisitin Equipment Eliminatins and Other Cnslidated Ttal Revenues frm unaffiliated custmers _ _ 1,031.7 Inter segment revenues _ 48.1 (287.8) _ _ 66.2 (194.9) _ Operating revenues (287.8) (194.9) 1,031.7 Depreciatin and amrtizatin (excluding multi client surveys) (153.2) (20.9) (33.3) _ (207.4) (86.2) (18.1) (11.6) _ (115.9) Depreciatin and amrtizatin f multiclient surveys _ (114.4) (114.4) _ (102.4) (102.4) Operating incme (150.4) (74.8) (185.9) (77.9) Share f incme in cmpanies accunted fr under equity methd (1) (12.1) (1.1) (13.2) (4.0) (0.5) (4.5) Earnings befre interest and tax (2) (162.5) (74.8) (199.1) (77.9) Capital expenditures (excluding multi client surveys) (3) (8.2) 81.9 Investments in multiclient surveys, net cash _ _ (1) Share f perating results f cmpanies accunted fr under equity methd were U.S.$(11.9) millin and U.S. $(6.8) millin fr the three mnths ended June 30, and 2013, respectively. (2) Fr the three mnths ended June 30,, Acquisitin EBIT includes U.S.$(157.6) millin f nn recurring items: (i) U.S.$(116.7) millin related t the marine and land transfrmatin plan, f which U.S.$(92.8) millin relating t redundancies csts, facilities exit csts and prvisins fr nerus cntracts and U.S.$(23.9) millin impairment f marine fixed equipment; (ii) U.S.$(52.0) millin impairment f ur investment in the cmpany Seabed Geslutins BV accunted fr under equity methd; and (iii) a net gain arising frm the sale f Ardiseis FZCO amunting t U.S.$11.1 millin. GGR EBIT includes a U.S.$(36.7) millin impairment f Brazilian multi client surveys; and redundancies and facilities exit csts fr U.S.$(3.4) millin. Equipment EBIT includes a U.S.$(21.7) millin impairment f intangible assets. Eliminatins and ther includes U.S.$(13.9) millin f general crprate expenses and U.S.$(61.0) millin f intragrup margin. Fr the three mnths ended June 30, 2013, eliminatins and ther included general crprate expenses f U.S.$(15.7) millin, U.S.$(51.4) millin f intra grup margin and U.S.$(10.8) millin f nn recurring items related t the acquisitin f Fugr s Gesciences Divisin: (i) restructuring csts f U.S.$(6.2) millin related t the acquired vessels frm Fugr; and (ii) acquisitin csts f U.S.$(4.6) millin. (3) Capital expenditures include capitalized develpment csts f U.S.$(15.1) millin and U.S.$(13.4) millin fr the three mnths ended June 30, and 2013, respectively. 22

23 UNAUDITED INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS Six mnths ended June 30, Amunts in millins f U.S.$ 2013 OPERATING Net incme (lss) (363.6) Depreciatin and amrtizatin Multi client surveys depreciatin and amrtizatin Depreciatin and amrtizatin capitalized t multi client surveys (72.6) (47.1) Variance n prvisins Stck based cmpensatin expenses Net gain (lss) n dispsal f fixed assets (7.1) (97.5) Equity incme (lss) f investees 29.7 (6.1) Dividends received frm affiliates 29.9 Other nn cash items Net cash including net cst f financial debt and incme tax Less net cst f financial debt Less incme tax expense Net cash excluding net cst f financial debt and incme tax Incme tax paid (67.7) (58.7) Net cash befre changes in wrking capital change in trade accunts and ntes receivable (31.9) change in inventries and wrk in prgress 20.5 (7.4) change in ther current assets (20.7) (1.6) change in trade accunts and ntes payable (34.5) (146.8) change in ther current liabilities (44.8) (44.0) Impact f changes in exchange rate n financial items (0.2) 2.1 Net cash prvided by perating activities INVESTING Capital expenditures (including variatin f fixed assets suppliers, excluding multi client surveys) (188.4) (158.0) Investment in multi client surveys, net cash (331.0) (234.5) Prceeds frm dispsals f tangible and intangible assets Ttal net prceeds frm financial assets Acquisitin f investments, net f cash and cash equivalents acquired (6.5) (939.6) Impact f changes in cnslidatin scpe Variatin in lans granted Variatin in subsidies fr capital expenditures Variatin in ther nn current financial assets (2.8) 0.1 Net cash used in investing activities (525.1) (1,293.7) FINANCING Repayment f lng term debts (1,070.7) (184.2) Ttal issuance f lng term debts 1, Lease repayments (4.3) (9.3) Change in shrt term lans (2.6) 3.5 Financial expenses paid (71.8) (65.8) Net prceeds frm capital increase frm sharehlders frm nn cntrlling interests f integrated cmpanies Dividends paid and share capital reimbursements t sharehlders t nn cntrlling interests f integrated cmpanies (35.5) (7.5) Acquisitin/dispsal frm treasury shares Net cash prvided by (used in) financing activities 30.2 (150.3) Effects f exchange rates n cash (0.7) 15.5 Impact f changes in cnslidatin scpe (30.0) Net increase (decrease) in cash and cash equivalents (144.7) (1,161.4) Cash and cash equivalents at beginning f year ,520.2 Cash and cash equivalents at end f perid