TGS announces Q4 2015 revenue of approximately 131 MUSD and guides for 2016

ASKER, NORWAY (07 January 2016) - Based on a preliminary review of sales and investments, TGS provides the following update on Q4 2015:

• Q4 2015 net operating revenues of approximately 131 MUSD, down 56% from Q4 2014
• Expected 2015 full year revenues of approximately 612 MUSD, down 33% from 2014
• Q4 2015 operational multi-client investments of approximately 84 MUSD to reach full year investments of 497 MUSD
• Cash balance of 162 MUSD at year-end
• Final Q4 2015 results to be reported on 02 February 2016

The weak market conditions are expected to continue in 2016. Consequently, TGS is planning for a lower activity level, which results in the following guidance for 2016:

• TGS expects multi-client investments of approximately 220 MUSD
• Multi-client investments are expected to be prefunded 45 to 50%

As announced on 4 December 2015, the accounting practice with respect to amortization of the multi-client library will change with effect from 1 January 2016. In accordance with the new policy TGS estimates multi-client amortization of close to 290 MUSD in 2016.  An expected impact of the new accounting practice will be more predictable and less volatile quarterly normal amortization of the data library.

"TGS' 2016 operational multi-client investments will be reduced by more than 50% compared to 2015. This is partly a result of lower cost of acquiring seismic data as average vessel day rates will be substantially lower than in 2015. Furthermore, the activity level will be reduced as oil companies have become less willing to prefund new surveys" commented Robert Hobbs, CEO, TGS.  "As a result of the weak market conditions there is higher uncertainty than usual with respect to late sales of seismic data. Late sales are normally heavily dependent on oil companies' E&P spending.  This relationship will continue in 2016 and as a result, TGS expects late sales to move in line with or slightly better than general E&P spending trends.  However, the significant reduction in investments combined with the effect from the cost cutting measures implemented last year should support positive cash flow development despite the challenging environment."

Conference Call 07 January 2016

CEO Robert Hobbs and CFO Sven Børre Larsen will host a conference call at CET 3:00pm (9:00 AM New York time).

Call-in details are as follows:

Attendees may want to call 5-10 minutes before 3:00 CET (9:00 AM NY) to ensure registration and access.

• Norwegian attendees are invited to call +800 56053 or +47 2316 2729
• International attendees are invited to call 0800 279 5004 or +44 (0)20 3427 1900
• US attendees are invited to call +1 877 280 2296

Participants will need to quote the following confirmation code when dialing into the conference: 3630842

A Q&A session will follow a short introduction, based upon the presentation issued in the morning. To pose a question, please press *1.

A replay of the conference call will be available shortly after. To access replay of the TGS conference call,

• Dial +47 2100 0498 (Norway) or +44 (0)20 3427 0598 (UK) or +1 866 932 5017 (US)
• Replay access code is 3630842 followed by the # (pound sign)

A replay of the conference call will also be available at www.tgs.com.