Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2013 | Apr. 23, 2013 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'ION GEOPHYSICAL CORP | ' |
Entity Central Index Key | '0000866609 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-13 | ' |
Amendment Flag | 'false | ' |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 156,851,390 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (Unaudited) (USD $) | Mar. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $66,575 | $60,971 |
Accounts receivable, net | 91,034 | 127,136 |
Unbilled receivables | 77,846 | 89,784 |
Inventories | 68,083 | 70,675 |
Prepaid expenses and other current assets | 23,527 | 25,605 |
Total current assets | 327,065 | 374,171 |
Deferred income tax asset | 34,503 | 28,414 |
Property, plant, equipment and seismic rental equipment, net | 34,153 | 33,772 |
Multi-client data library, net | 224,993 | 230,315 |
Equity method investments | 76,518 | 73,925 |
Goodwill | 53,753 | 55,349 |
Intangible assets, net | 13,817 | 14,841 |
Other assets | 17,602 | 9,796 |
Total assets | 782,404 | 820,583 |
Current liabilities: | ' | ' |
Current maturities of long-term debt | 3,402 | 3,496 |
Accounts payable | 33,499 | 28,688 |
Accrued expenses | 92,252 | 124,095 |
Accrued multi-client data library royalties | 22,223 | 26,300 |
Deferred revenue | 19,631 | 26,899 |
Total current liabilities | 171,007 | 209,478 |
Long-term debt, net of current maturities | 101,057 | 101,832 |
Other long-term liabilities | 8,813 | 8,131 |
Total liabilities | 280,877 | 319,441 |
Redeemable noncontrolling interest | 2,151 | 2,123 |
Equity: | ' | ' |
Cumulative convertible preferred stock | 27,000 | 27,000 |
Common stock, $0.01 par value; authorized 200,000,000 shares; outstanding 156,665,553 and 156,356,949 shares at March 31, 2013 and December 31, 2012, respectively, net of treasury stock | 1,567 | 1,564 |
Additional paid-in capital | 850,832 | 848,669 |
Accumulated deficit | -358,422 | -360,297 |
Accumulated other comprehensive loss | -15,542 | -11,886 |
Treasury stock, at cost, 849,539 shares at both March 31, 2013 and December 31, 2012 | -6,565 | -6,565 |
Total stockholders' equity | 498,870 | 498,485 |
Noncontrolling interests | 506 | 534 |
Total equity | 499,376 | 499,019 |
Total liabilities and equity | $782,404 | $820,583 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $) | Mar. 31, 2013 | Dec. 31, 2012 |
Statement of Financial Position [Abstract] | ' | ' |
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 200,000,000 | ' |
Common stock, shares outstanding | 156,665,553 | 156,356,949 |
Treasury stock, shares | 849,539 | 849,539 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2013 | Mar. 31, 2012 |
Income Statement [Abstract] | ' | ' |
Service revenues | $89,949 | $66,634 |
Product revenues | 39,788 | 45,076 |
Total net revenues | 129,737 | 111,710 |
Cost of services | 69,273 | 47,406 |
Cost of products | 25,507 | 23,148 |
Gross profit | 34,957 | 41,156 |
Operating expenses: | ' | ' |
Research, development and engineering | 9,290 | 7,726 |
Marketing and sales | 7,980 | 7,417 |
General and administrative | 15,764 | 14,370 |
Total operating expenses | 33,034 | 29,513 |
Income from operations | 1,923 | 11,643 |
Interest expense, net | -1,066 | -1,518 |
Equity in earnings of investments | 1,116 | 2,468 |
Other income (expense) | 1,027 | -686 |
Income before income taxes | 3,000 | 11,907 |
Income tax expense | 1,201 | 3,445 |
Net income | 1,799 | 8,462 |
Net income attributable to noncontrolling interest | 76 | 113 |
Net income attributable to ION | 1,875 | 8,575 |
Preferred stock dividends | 338 | 338 |
Net income applicable to common shares | $1,537 | $8,237 |
Net income per share: | ' | ' |
Basic | $0.01 | $0.05 |
Diluted | $0.01 | $0.05 |
Weighted average number of common shares outstanding: | ' | ' |
Basic | 156,465 | 155,543 |
Diluted | 157,315 | 156,547 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2013 | Mar. 31, 2012 |
Statement of Other Comprehensive Income [Abstract] | ' | ' |
Net income | $1,799 | $8,462 |
Other comprehensive income (loss), net of taxes, as appropriate: | ' | ' |
Foreign currency translation adjustments | -3,641 | 1,767 |
Equity interest in investeesb other comprehensive income (loss) | -23 | 348 |
Unrealized income (loss) on available-for-sale securities | -68 | 962 |
Other changes in other comprehensive income | 76 | 7 |
Total other comprehensive income (loss), net of taxes | -3,656 | 3,084 |
Comprehensive net income (loss) | -1,857 | 11,546 |
Comprehensive income attributable to noncontrolling interest | 76 | 113 |
Comprehensive net income (loss) attributable to ION | ($1,781) | $11,659 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2013 | Mar. 31, 2012 |
Cash flows from operating activities: | ' | ' |
Net income | $1,799 | $8,462 |
Adjustments to reconcile net income to cash provided by operating activities: | ' | ' |
Depreciation and amortization (other than multi-client library) | 4,200 | 3,090 |
Amortization of multi-client library | 18,592 | 22,620 |
Stock-based compensation expense | 2,011 | 1,484 |
Equity in earnings of investments | -1,116 | -2,468 |
Deferred income taxes | -6,150 | -1,063 |
Change in operating assets and liabilities: | ' | ' |
Accounts receivable | 35,307 | 61,018 |
Unbilled receivables | 11,938 | -23,016 |
Inventories | 1,381 | 965 |
Accounts payable, accrued expenses and accrued royalties | -13,373 | -13,025 |
Deferred revenue | -7,153 | -4,736 |
Other assets and liabilities | 2,155 | -1,491 |
Net cash provided by operating activities | 49,591 | 51,840 |
Cash flows from investing activities: | ' | ' |
Investment in multi-client data library | -28,778 | -24,527 |
Purchase of property, plant and equipment | -3,774 | -1,768 |
Investment in and advances to GeoRXT | -9,500 | 0 |
Maturity of short-term investments | 0 | 20,000 |
Investment in convertible notes | -1,000 | 0 |
Other investing activities | 76 | 0 |
Net cash used in investing activities | -42,976 | -6,295 |
Cash flows from financing activities: | ' | ' |
Payments on long-term debt | -848 | -1,431 |
Payment of preferred dividends | -338 | -338 |
Proceeds from exercise of stock options | 716 | 249 |
Other financing activities | 350 | 453 |
Net cash used in provided by financing activities | -120 | -1,067 |
Effect of change in foreign currency exchange rates on cash and cash equivalents | -891 | 216 |
Net increase (decrease) in cash and cash equivalents | 5,604 | 44,694 |
Cash and cash equivalents at beginning of period | 60,971 | 42,402 |
Cash and cash equivalents at end of period | $66,575 | $87,096 |
Basis_of_Presentation
Basis of Presentation | 3 Months Ended | |||||||||||
Mar. 31, 2013 | ||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||||||||
Basis of Presentation | ' | |||||||||||
Basis of Presentation and Restatement | ||||||||||||
Basis of Presentation | ||||||||||||
The condensed consolidated balance sheet of ION Geophysical Corporation and its subsidiaries (collectively referred to as the “Company” or “ION,” unless the context otherwise requires) at December 31, 2012 has been derived from the Company’s audited consolidated financial statements at that date. The condensed consolidated balance sheet at March 31, 2013, and the condensed consolidated statements of operations, comprehensive income (loss) and cash flows for the three months ended March 31, 2013 and 2012, are unaudited. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The results of operations for the three months ended March 31, 2013 are not necessarily indicative of the operating results for a full year or of future operations. | ||||||||||||
These condensed consolidated financial statements have been prepared using accounting principles generally accepted in the United States for interim financial information and the instructions to Form 10-Q and applicable rules of Regulation S-X of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in annual financial statements presented in accordance with accounting principles generally accepted in the United States have been omitted. The accompanying condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2012 and Amendment No. 1 thereto on Form 10-K/A, which was filed on April 17, 2013 and contains the separate consolidated financial statements of INOVA Geophysical Equipment Limited (“INOVA Geophysical”) for the fiscal year ended December 31, 2012. | ||||||||||||
Restatement of the Financial Statements for the Three Months Ended March 31, 2013 | ||||||||||||
The condensed consolidated statement of cash flows for the three months ended March 31, 2013 has been restated. In connection with the preparation of the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2013, the Company determined that it had incorrectly presented certain non-cash investments in its multi-client seismic data libraries in its condensed consolidated statements of cash flows. The Company incorrectly included non-cash activity related to the investment in its multi-client seismic data libraries, which resulted in an understatement of its cash provided by operating activities and an understatement of its cash used in investing activities. Management concluded that the impact of the incorrect presentation to periods prior to 2013 was immaterial. | ||||||||||||
The consolidated financial information contained in this Form 10-Q/A for the three months ended March 31, 2013 reflects the Company’s restated statement of cash flows for this three-month period resulting in changes within cash flows from operating and investing activities, but no change to total cash and cash equivalents. The adjustments reflected in the restatement of the condensed consolidated statement of cash flows are as follows (in thousands): | ||||||||||||
Three Months Ended March 31, 2013 | ||||||||||||
As Reported | Adjustment | As Restated | ||||||||||
Statement of Cash Flows: | ||||||||||||
Accounts payable, accrued expenses and accrued royalties | $ | (28,686 | ) | $ | 15,313 | $ | (13,373 | ) | ||||
Net cash provided by operating activities | $ | 34,278 | $ | 15,313 | $ | 49,591 | ||||||
Investment in multi-client data library | $ | (13,270 | ) | $ | (15,508 | ) | $ | (28,778 | ) | |||
Purchase of property, plant and equipment | $ | (3,969 | ) | $ | 195 | $ | (3,774 | ) | ||||
Net cash used in investing activities | $ | (27,663 | ) | $ | (15,313 | ) | $ | (42,976 | ) | |||
Net increase in cash and cash equivalents | $ | 5,604 | $ | — | $ | 5,604 | ||||||
Cash and cash equivalents at end of period | $ | 66,575 | $ | — | $ | 66,575 | ||||||
Segment_Information
Segment Information | 3 Months Ended | |||||||
Mar. 31, 2013 | ||||||||
Segment Reporting [Abstract] | ' | |||||||
Segment Information | ' | |||||||
Segment Information | ||||||||
The Company operates through three business segments – Solutions, Systems and Software – as well as through the Company’s INOVA Geophysical joint venture. The Company measures segment operating results based on income from operations. See Note 3 “Equity Method Investments” for the summarized financial information for INOVA Geophysical. | ||||||||
A summary of segment information is as follows (in thousands): | ||||||||
Three Months Ended March 31, | ||||||||
2013 | 2012 | |||||||
Net revenues: | ||||||||
Solutions: | ||||||||
New Venture | $ | 48,436 | $ | 28,994 | ||||
Data Library | 9,448 | 10,268 | ||||||
Total multi-client revenues | 57,884 | 39,262 | ||||||
Data Processing | 31,286 | 26,865 | ||||||
Total | $ | 89,170 | $ | 66,127 | ||||
Systems: | ||||||||
Towed Streamer | $ | 13,549 | $ | 15,804 | ||||
Ocean Bottom | 6,765 | 3,519 | ||||||
Other | 11,533 | 17,383 | ||||||
Total | $ | 31,847 | $ | 36,706 | ||||
Software: | ||||||||
Software Systems | $ | 7,941 | $ | 8,370 | ||||
Services | 779 | 507 | ||||||
Total | $ | 8,720 | $ | 8,877 | ||||
Total | $ | 129,737 | $ | 111,710 | ||||
Gross profit: | ||||||||
Solutions | $ | 20,197 | $ | 18,985 | ||||
Systems | 8,380 | 15,812 | ||||||
Software | 6,380 | 6,359 | ||||||
Total | $ | 34,957 | $ | 41,156 | ||||
Gross margin: | ||||||||
Solutions | 23 | % | 29 | % | ||||
Systems | 26 | % | 43 | % | ||||
Software | 73 | % | 72 | % | ||||
Total | 27 | % | 37 | % | ||||
Income from operations: | ||||||||
Solutions | $ | 7,357 | $ | 9,606 | ||||
Systems | 934 | 8,740 | ||||||
Software | 5,161 | 5,482 | ||||||
Corporate and other | (11,529 | ) | (12,185 | ) | ||||
Income from operations | 1,923 | 11,643 | ||||||
Interest expense, net | (1,066 | ) | (1,518 | ) | ||||
Equity in earnings of investments | 1,116 | 2,468 | ||||||
Other income (expense) | 1,027 | (686 | ) | |||||
Income before income taxes | $ | 3,000 | $ | 11,907 | ||||
Equity_Method_Investments
Equity Method Investments | 3 Months Ended | |||||||||||
Mar. 31, 2013 | ||||||||||||
Equity Method Investments and Joint Ventures [Abstract] | ' | |||||||||||
Equity Method Investments | ' | |||||||||||
Equity Method Investments | ||||||||||||
The following table reflects the change in our equity method investments during the three months ended March 31, 2013 (in thousands): | ||||||||||||
INOVA Geophysical | GeoRXT | Total | ||||||||||
Investment at December 31, 2012 | $ | 73,925 | $ | — | $ | 73,925 | ||||||
Investment in equity | — | 1,500 | 1,500 | |||||||||
Equity in earnings (losses) of investments | 1,851 | (735 | ) | 1,116 | ||||||||
Equity interest in investees' other comprehensive income (loss) | (23 | ) | — | (23 | ) | |||||||
Investments at March 31, 2013 | $ | 75,753 | $ | 765 | $ | 76,518 | ||||||
In late February 2013, the Company purchased from Reservoir Exploration Technology ASA its 30% interest in a joint venture entity, GeoRXT B.V. (“GeoRXT”), for $1.5 million. GeoRXT is headquartered in Rio de Janeiro, Brazil, and specializes in seismic acquisition operations using ocean-bottom cables deployed from vessels leased by GeoRXT. The Company has an option, exercisable at any time on or prior to May 15, 2013, to increase its ownership percentage to 50% by making additional capital contributions to GeoRXT of $40.0 million. Additionally, the Company provided GeoRXT with an $8.0 million working capital loan, the repayment of which is guaranteed by GeoRXT’s majority joint venture partner, Georadar Levantamentos Geofisicos S/A (“Georadar”). GeoRXT is obligated to repay this loan to the Company on or before May 25, 2013. However, the Company currently expects to exercise its option to increase its ownership interest in GeoRXT to 50%, of which part of the required capital contribution will be funded through the conversion of this loan into additional equity. Therefore, this loan has been classified within long-term other assets. The Company accounts for its interest in GeoRXT on a current basis; its share of losses in GeoRXT for March 2013 was $(0.7) million. | ||||||||||||
The Company accounts for its 49% interest in INOVA Geophysical as an equity method investment and records its share of earnings and losses of INOVA Geophysical on a one fiscal quarter lag basis. The following table reflects the summarized financial information for INOVA Geophysical for the three-month periods ended December 31, 2012 and 2011 (in thousands): | ||||||||||||
Three Months Ended December 31, | ||||||||||||
2012 | 2011 | |||||||||||
Net revenues | $ | 59,611 | $ | 58,998 | ||||||||
Gross profit | $ | 12,327 | $ | 13,964 | ||||||||
Income (loss) from operations | $ | (250 | ) | $ | 6,509 | |||||||
Net income | $ | 3,742 | $ | 5,717 | ||||||||
Inventories
Inventories | 3 Months Ended | |||||||
Mar. 31, 2013 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Inventories | ' | |||||||
Inventories | ||||||||
A summary of inventories is as follows (in thousands): | March 31, | December 31, | ||||||
2013 | 2012 | |||||||
Raw materials and subassemblies | $ | 47,709 | $ | 49,421 | ||||
Work-in-process | 7,976 | 8,613 | ||||||
Finished goods | 26,672 | 26,880 | ||||||
Reserve for excess and obsolete inventories | (14,274 | ) | (14,239 | ) | ||||
Total | $ | 68,083 | $ | 70,675 | ||||
Net_Income_per_Share
Net Income per Share | 3 Months Ended | |||||||
Mar. 31, 2013 | ||||||||
Earnings Per Share [Abstract] | ' | |||||||
Net Income per Share | ' | |||||||
Net Income per Share | ||||||||
Basic net income per common share is computed by dividing net income applicable to common shares by the weighted average number of common shares outstanding during the period. Diluted net income per common share is determined based on the assumption that dilutive restricted stock and restricted stock unit awards have vested and outstanding dilutive stock options have been exercised and the aggregate proceeds were used to reacquire common stock using the average price of such common stock for the period. The total number of shares issued or reserved for future issuance under outstanding stock options at March 31, 2013 and 2012 was 7,717,937 and 6,832,575, respectively, and the total number of shares of restricted stock and shares reserved for restricted stock units outstanding at March 31, 2013 and 2012 was 1,034,280 and 1,168,001, respectively. | ||||||||
As of March 31, 2013, there are 27,000 outstanding shares of the Company’s Series D Cumulative Convertible Preferred Stock (“Series D Preferred Stock”), which may currently be converted, at the holder’s election, into up to 6,065,075 shares of the Company’s common stock. The outstanding shares of Series D Preferred Stock were anti-dilutive for all periods presented. | ||||||||
The following table summarizes the computation of basic and diluted net income per common share (in thousands, except per share amounts): | ||||||||
Three Months Ended March 31, | ||||||||
2013 | 2012 | |||||||
Net income applicable to common shares | $ | 1,537 | $ | 8,237 | ||||
Weighted average number of common shares outstanding | 156,465 | 155,543 | ||||||
Effect of dilutive stock awards | 850 | 1,004 | ||||||
Weighted average number of diluted common shares outstanding | 157,315 | 156,547 | ||||||
Basic net income per share | $ | 0.01 | $ | 0.05 | ||||
Diluted net income per share | $ | 0.01 | $ | 0.05 | ||||
Longterm_Debt
Long-term Debt | 3 Months Ended | ||||||||
Mar. 31, 2013 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
Long-term Debt and Interest Rate Caps | ' | ||||||||
Long-term Debt | |||||||||
Obligations (in thousands) | March 31, | December 31, | |||||||
2013 | 2012 | ||||||||
Revolving line of credit | $ | 97,250 | $ | 97,250 | |||||
Facility lease obligation | 2,139 | 2,334 | |||||||
Equipment capital leases | 5,070 | 5,744 | |||||||
Total | 104,459 | 105,328 | |||||||
Current portion of long-term debt and lease obligations | (3,402 | ) | (3,496 | ) | |||||
Non-current portion of long-term debt and lease obligations | $ | 101,057 | $ | 101,832 | |||||
Revolving Line of Credit | |||||||||
On May 29, 2012, the Company amended the terms of its senior secured credit facility (the “Credit Facility”) with China Merchants Bank Co., Ltd., New York Branch, as administrative agent and lender (“CMB”). The First Amendment to the Credit Agreement and Loan Documents (the “First Amendment”) modified certain provisions of the Company’s senior credit agreement with CMB that it had entered into on March 25, 2010. The maturity date of any outstanding debt under the Credit Facility remains March 24, 2015. | |||||||||
As amended by the First Amendment, the Credit Facility provides that the Company may make revolving credit borrowings in U.S. Dollars, Euros, British Pounds Sterling or Canadian Dollars up to an amount not to exceed the U.S. Dollar equivalent of $175.0 million. The Company also agreed that no additional borrowings may be made at any time at which the outstanding indebtedness under the revolving line of credit (principal, accrued interest and fees) exceeds the U.S. Dollar equivalent of $175.0 million. In addition, all then-outstanding term loan indebtedness under the Credit Facility was converted to revolving credit indebtedness, such that as of May 29, 2012, there was $98.3 million in total revolving credit indebtedness outstanding under the Credit Facility. The First Amendment eliminated sub-facility limits under the Credit Facility. | |||||||||
The Company’s obligations under the Credit Facility continue to be guaranteed by certain of its material U.S. subsidiaries that remain as parties to the Credit Facility. In addition, INOVA Geophysical continues to provide a bank stand-by letter of credit as credit support for the Company’s obligations under the Credit Facility. The Company also entered into a credit support agreement with INOVA Geophysical whereby the Company has agreed to indemnify INOVA Geophysical for any and all losses sustained by INOVA Geophysical that arise out of or are a result of the enforcement of INOVA Geophysical’s guarantee. | |||||||||
As amended by the First Amendment, the interest rates per annum on borrowings under the Credit Facility are, at the Company’s option: | |||||||||
• | an alternate base rate equal to the sum of (i) the greatest of (a) the prime rate of CMB, (b) a federal funds effective rate plus 0.50%, or (c) an adjusted LIBOR-based rate plus 1.0%, and (ii) an applicable interest margin of 1.4% (reduced from 2.5%); or | ||||||||
• | for eurodollar borrowings and borrowings in Euros, Pounds Sterling or Canadian Dollars, the sum of (i) an adjusted LIBOR-based rate, and (ii) an applicable interest margin of 2.4% (reduced from 3.5%). | ||||||||
As of March 31, 2013, there was $97.3 million of outstanding revolving credit indebtedness under the Credit Facility that accrued interest at a rate of 2.71% per annum. | |||||||||
The Credit Facility contains covenants that restrict the Company, subject to certain exceptions, from: | |||||||||
• | incurring additional indebtedness (including certain capital lease obligations), granting or incurring additional liens on the Company's properties, pledging shares of the Company's subsidiaries, entering into certain merger or other change-in-control transactions, entering into certain transactions with the Company's affiliates, making certain sales or other dispositions of assets, making certain investments, acquiring other businesses and entering into sale-leaseback transactions with respect to the Company's properties; | ||||||||
• | paying cash dividends on the Company's common stock; and | ||||||||
• | repurchasing and acquiring the Company's capital stock, unless there is no event of default under the Credit Facility and the amount of such repurchases does not exceed an amount equal to (i) 25% of the Company's consolidated net income for the prior fiscal year, less (ii) the amount of any cash dividends paid on the Company's common stock. | ||||||||
The Credit Facility requires compliance with certain financial covenants, including the following: | |||||||||
• | maintain a minimum fixed charge coverage ratio, as defined, in an amount equal to at least 1.125 to 1; | ||||||||
• | not exceed a maximum leverage ratio, as defined, of 3.25 to 1; and | ||||||||
• | maintain a minimum tangible net worth of at least 60% of ION’s tangible net worth as of March 31, 2010, as defined. | ||||||||
The fixed charge coverage ratio is defined as the ratio of (i) the Company's consolidated EBITDA, as defined in the Credit Facility, less cash income tax expense, non-financed capital expenditures and capitalized research and development costs to (ii) the sum of scheduled payments of lease payments and payments of principal indebtedness, interest expense actually paid and cash dividends, in each case for the four consecutive fiscal quarters most recently ended. The leverage ratio is defined as the ratio of (x) total funded consolidated debt, capital lease obligations and issued letters of credit (net of cash collateral) to (y) the Company's consolidated EBITDA for the four consecutive fiscal quarters most recently ended. | |||||||||
The Credit Facility contains customary event of default provisions, including a “change of control” event, the occurrence of which could lead to an acceleration of the Company's obligations under the Credit Facility. The Credit Facility also provides that certain acts of bankruptcy, insolvency or liquidation of INOVA Geophysical or BGP, Inc., China National Petroleum Corporation (“BGP”) would constitute additional events of default under the Credit Facility. | |||||||||
As of March 31, 2013, the Company was in compliance with these financial covenants and the Company expects to remain in compliance with these financial covenants for at least the next 12 months. |
Income_Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2013 | |
Income Tax Disclosure [Abstract] | ' |
Income Taxes | ' |
Income Taxes | |
The Company maintains a valuation allowance for a portion of its deferred tax assets that relate to U.S. capital losses or basis differences that will create capital losses as well as non-U.S net operating losses. The valuation allowance is calculated in accordance with the provisions of Accounting Series Codification (“ASC”) 740 “Income Taxes,” which requires that a valuation allowance be established or maintained when it is “more likely than not” that all or a portion of deferred tax assets will not be realized. In the event the Company's expectations of future operating results change, the valuation allowance may need to be adjusted upward or downward. As of March 31, 2013, the Company's unreserved U.S. deferred tax assets totaled $13.8 million. These existing unreserved deferred tax assets are currently considered to be “more likely than not” to be realized. | |
The Company's effective tax rates for the three months ended March 31, 2013 and 2012 were 40.0% and 28.9%, respectively. The change in the Company's effective tax rate for the three months ended March 31, 2013 was primarily due to a $1.2 million adjustment that related to prior periods, which was partially offset by discrete tax benefits totaling $(0.9) million. The adjustment primarily relates to differences in prior periods between the Company's financial statements and its tax returns, which had not been appropriately reflected in those periods. Because this adjustment was not material to either of the prior periods nor to the expected results or trend of earnings for 2013, it was recorded in the current period. The discrete tax benefits recorded in the three months ended March 31, 2013 were mainly comprised of U.S. tax benefits and credits that were extended in the American Taxpayer Relief Act of 2012, signed into law in January 2013. Excluding these amounts, the Company's effective tax rate for the three months ended March 31, 2013 would have been 28.9%. | |
The total amount of unrecognized tax benefits as of March 31, 2013 was $1.8 million. The Company accrues interest and penalties, if any, related to unrecognized tax benefits as a component of the Company's provision for income taxes. | |
The Company’s U.S. federal tax returns for 2007 and subsequent years remain subject to examination by tax authorities. The Company is no longer subject to IRS examination for periods prior to 2007, although carryforward attributes that were generated prior to 2007 may still be adjusted upon examination by the IRS if they either have been or will be used in an open year. In the Company’s foreign tax jurisdictions, tax returns for 2008 and subsequent years generally remain open to examination. |
Fair_Value_of_Financial_Instru
Fair Value of Financial Instruments | 3 Months Ended | |||||||||||
Mar. 31, 2013 | ||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||
Fair Value of Financial Instruments | ' | |||||||||||
Fair Value of Financial Instruments | ||||||||||||
The Company’s financial instruments include cash and cash equivalents, accounts and unbilled receivables, notes receivable, accounts payable, accrued multi-client data library royalties, investment in two convertible notes from a privately-owned U.S.-based technology company and long-term debt. The carrying amounts of cash and cash equivalents, accounts and unbilled receivables, notes receivable, accounts payable and accrued multi-client data library royalties approximate fair value due to the highly liquid nature of these instruments. | ||||||||||||
The carrying amount of the Company’s long-term debt as of March 31, 2013 and December 31, 2012 was $104.5 million and $105.3 million, respectively, compared to fair value of $104.6 million and $105.3 million as of March 31, 2013 and December 31, 2012, respectively. The fair value of the long-term debt was calculated using a market approach based upon Level 3 inputs, including an estimated interest rate reflecting current market conditions. | ||||||||||||
The following table provides additional information related to assets measured at fair value on a recurring basis at March 31, 2013 and December 31, 2012. The reference to level within the table relates to the level of inputs used to determine fair value, which the key inputs are then described below. The table is as follows (amounts in thousands): | ||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||
As of March 31, 2013: | ||||||||||||
Investment in convertible notes | $ | — | $ | — | $ | 9,127 | ||||||
As of December 31, 2012: | ||||||||||||
Investment in convertible note | — | — | 8,195 | |||||||||
Investment in Convertible Notes. In May 2011, the Company purchased a convertible note from a privately-owned U.S.-based technology company. The original principal amount of the note is $6.5 million, and it bears interest at a rate of 4% per annum. In March 2012, the Company and the investee entered into an agreement for the Company to make available to the investee a credit facility in an amount of up to $4.0 million. This credit facility originally had a term of one year with an option to extend its term by one year, which was exercised by the investee. The credit facility allows for conversion of the outstanding balance of the promissory note under the credit facility into common shares of the investee. As of March 31, 2013, the investee had drawn $3.0 million under this credit arrangement. | ||||||||||||
The Company performed a fair value analysis with respect to its investment in the convertible notes using a market approach based upon Level 3 inputs, including the terms and likelihood of an investment event and the time to conversion or repayment. As of March 31, 2013, the fair value of these investments was approximately $9.1 million, with $0.4 million of unrealized losses recorded through accumulated other comprehensive income within equity. |
Litigation
Litigation | 3 Months Ended |
Mar. 31, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Litigation | ' |
Litigation | |
WesternGeco | |
In June 2009, WesternGeco L.L.C. (“WesternGeco”) filed a lawsuit against the Company in the United States District Court for the Southern District of Texas, Houston Division. In the lawsuit, styled WesternGeco L.L.C. v. ION Geophysical Corporation, WesternGeco alleges that the Company had infringed several method and apparatus claims contained in four of its United States patents regarding marine seismic streamer steering devices. WesternGeco sought unspecified monetary damages and an injunction prohibiting the Company from making, using, selling, offering for sale or supplying any infringing products in the United States. | |
In June 2009, the Company filed an answer and counterclaims against WesternGeco, in which the Company denied that it had infringed WesternGeco’s patents and asserted that the WesternGeco patents were invalid or unenforceable. The Company also asserted that WesternGeco’s Q-Marine system, components and technology infringed upon a United States patent related to marine seismic streamer steering devices. In addition, the Company claimed that the lawsuit by WesternGeco was an illegal attempt by WesternGeco to control and restrict competition in the market for marine seismic surveys performed using laterally steerable streamers. In its counterclaims, the Company requested various remedies and relief, including a declaration that the WesternGeco patents were invalid or unenforceable, an injunction prohibiting WesternGeco from making, using, selling, offering for sale or supplying any infringing products in the United States, a declaration that the WesternGeco patents should be co-owned by the Company, and an award of unspecified monetary damages. | |
In June 2010, WesternGeco filed a lawsuit against various subsidiaries and affiliates of Fugro N.V. (“Fugro”), one of the Company’s seismic contractor customers, accusing Fugro of infringing the same United States patents regarding marine seismic streamer steering devices by planning to use certain equipment purchased from the Company on a survey located outside of U.S. territorial waters. The court approved the consolidation of the Fugro case with the case against the Company. Fugro filed a motion to dismiss the lawsuit, and in March 2011 the presiding judge granted Fugro’s motion to dismiss in part, on the basis that the alleged activities of Fugro would occur more than 12 miles from the U.S. coast and therefore are not actionable under U.S. patent infringement law. In February 2012, the Court granted WesternGeco’s motions for summary judgment, dismissing the Company’s claims as plaintiff against WesternGeco for infringement, inventorship and inequitable conduct. In response to a Motion for Summary Judgment filed jointly by the Company and Fugro, the Court ruled in April 2012 that the Company did not directly infringe WesternGeco’s method patent claims. In a pre-trial ruling on June 29, 2012, the Court ruled that, if a particular patent claim of WesternGeco was held to be valid and enforceable at the upcoming trial, the Company’s supplying of its DigiFIN® lateral streamer control system from the United States to its customers overseas with an intention for the customers to combine DigiFIN with other required components of the patent claim, would infringe one claim in one of WesternGeco’s asserted patents, U.S. Patent No. 7,293,520. | |
Trial began on July 23, 2012. During the trial, Fugro settled all claims asserted against it by WesternGeco and obtained a global license from WesternGeco. A verdict was returned by the jury on August 16, 2012, finding that the Company willfully infringed the claims contained in the four patents by supplying DigiFIN from the United States and awarded WesternGeco the sum of $105.9 million in damages, consisting of $12.5 million in reasonable royalty and $93.4 million in lost profits. The Company believes that the verdict is not consistent with applicable law or the facts or evidence in the case and, in September 2012, filed motions with the trial court to overturn all or portions of the verdict. | |
The ultimate outcome of the case in the trial court, and the content of the final judgment as a whole, presently rests with the presiding trial court judge. The next step in the case is for the trial court judge to decide post-verdict motions filed by the parties and enter a final judgment. The final judgment will determine the result of the trial prior to appeal. When he enters a final judgment in the case, the judge can choose to follow the jury verdict or to take other actions, such as changing to a different result or ordering an entirely new trial. As of the filing date of this Quarterly Report on Form 10-Q, the Court had not yet entered a final judgment in the case. | |
If the Court enters a final judgment that is adverse to the Company, the Company intends to appeal the judgment to the United States Court of Appeals for the Federal Circuit. WesternGeco would also have the right to elect to appeal any final judgment. | |
In rendering its verdict, the jury determined that the Company’s infringement was willful. Because the jury verdict indicated willfulness, the trial court judge will determine whether, in his independent judgment, the Company willfully infringed and he should declare this case to be “exceptional.” In order for the judge to find willful infringement and whether this case is exceptional, WesternGeco must prove, by clear and convincing evidence, that the Company acted with objective recklessness and in bad faith, fraudulently or engaged in similar misconduct related to the case. If the judge finds willful infringement and declares this case to be exceptional, the judge has the discretion, but not the obligation, to enhance the damages amount, not to exceed a trebling of the final judgment damages award plus reasonable attorneys’ fees. | |
The Company believes that, given its understanding and judgment of applicable law and the relevant facts and evidence in this case, and after considering the advice of counsel, it is unlikely that the Company will incur any additional loss as a result of the jury’s finding of willfulness. | |
Based on the Company’s understanding and judgment of relevant law and the facts and merits of this case, including appellate defenses, and after considering the advice of counsel, the Company has determined it is probable that, after exhaustion of all appeals, this lawsuit will result in a loss contingency to the Company in the amount of approximately $10 million, consisting of reasonable royalty damages, interest and court costs. The Company has reserved for this loss contingency. | |
It is reasonably possible that the Company may not ultimately prevail in the litigation and appeals process and that the Company’s loss related to the lawsuit could exceed the amount currently accrued, up to the amount of the damages in the jury verdict plus interest and court costs, or even higher if the Court decides to enhance the damages as described above. However, the Company does not believe that a loss of this magnitude is probable. The Company’s assessment of its potential loss contingency may change in the future due to developments at the trial court or appellate court and other events, such as changes in applicable law, and such reassessment could lead to the determination that no loss contingency is probable or that a greater loss contingency is probable, which could have a material effect on the Company’s financial condition or results of operations. | |
As stated above, the Company intends to appeal the judgment to the United States Court of Appeals for the Federal Circuit if the trial court enters a judgment adverse to the Company. In order to appeal the judgment, the Company may be required to post an appeal bond for the full amount of damages entered in the judgment. To be prepared for a possible adverse judgment in this case, the Company has arranged with sureties to post an appeal bond on its behalf if necessary. The terms of the bond enable each surety to require the Company to post collateral with the surety at any time the bond is outstanding, for up to the full amount of the bond. Depending on the size of the bond and the level of required collateral, in order to collateralize the bond the Company might need to utilize a combination of cash on hand, undrawn balances available under the revolving line of credit and possibly incur additional debt and/or equity financing, and the collateralization of a large appeal bond could have a possible adverse effect on the Company’s liquidity. If the Company is unable to post the appeal bond, the Company may be unable to stay enforcement of the judgment or appeal the case. At this time, the Company is unable to determine whether an appeal bond would be required, the amount of such an appeal bond, or whether and to what extent the sureties may require the appeal bond to be collateralized in the future. Similarly, the Company is unable to predict the timing of the final judgment being entered by the trial court or the timing of posting any required appeal bond. | |
Fletcher | |
In November 2009, Fletcher International Ltd. (“Fletcher”), the holder of the shares of the Company’s outstanding Series D Preferred Stock until June 2012, filed a lawsuit against the Company and certain of its directors in the Delaware Court of Chancery. In the lawsuit, styled Fletcher International, Ltd. v. ION Geophysical Corporation, et al, Fletcher alleged, among other things, that the Company violated Fletcher’s consent rights contained in the Series D Preferred Stock Certificates of Designation, by (a) the execution and delivery of a convertible promissory note to the Bank of China, New York Branch by one of our subsidiaries (incorporated in Luxembourg), in connection with a bridge loan funded in October 2009 by Bank of China, and (b) a Canadian subsidiary of the Company executing and delivering several promissory notes in 2008 in connection with the Company’s acquisition of ARAM Systems Ltd., Fletcher also alleged that the Company’s directors violated their fiduciary duties by allowing the subsidiaries to deliver the notes without Fletcher’s consent. In a Memorandum Opinion issued in May 2010 in response to a motion for partial summary judgment, the judge dismissed all of Fletcher’s claims against the named Company directors but also concluded that, because the bridge loan note executed by the Company’s Luxembourg subsidiary in 2009 was convertible into the Company’s common stock, Fletcher had the right to consent to the issuance of the note and that the Company had violated Fletcher’s consent rights by that subsidiary’s issuing the note without Fletcher’s consent. In March 2011, the judge dismissed certain additional claims asserted by Fletcher. In May 2012, the judge ruled that Fletcher did not have the right to consent with respect to two promissory notes executed and delivered by the Canadian subsidiary in September 2008 in connection with the Company’s purchase of ARAM Systems Ltd., but that Fletcher did have the right to consent to the execution and delivery in December 2008 of a replacement promissory note in the principal amount of $35 million, and that the Company had violated Fletcher’s consent rights by the subsidiary’s executing and delivering the replacement promissory note without Fletcher’s consent. Fletcher has since declared to the Court that it will not pursue damages related to the issuance of the replacement $35 million promissory note. | |
In June 2012, Fletcher filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York. Fletcher’s shares of Series D Preferred Stock, which had been pledged by Fletcher to secure certain indebtedness, were sold by the pledgee to the affiliate of D.E. Shaw & Co., Inc. in June 2012. The Company does not believe that the acquisition of the shares by an affiliate of D. E. Shaw & Co., Inc. or the bankruptcy filing by Fletcher will have a material impact on Fletcher’s lawsuit against the Company. The Company believes that the monetary damages suffered by Fletcher as a result of the Company’s subsidiary executing and delivering the convertible note without Fletcher’s consent are nonexistent or nominal, and that the ultimate outcome of the lawsuit will not result in a material adverse effect on the Company’s financial condition or results of operations. | |
Other | |
The Company has been named in various other lawsuits or threatened actions that are incidental to its ordinary business. Litigation is inherently unpredictable. Any claims against the Company, whether meritorious or not, could be time-consuming, cause the Company to incur costs and expenses, require significant amounts of management time and result in the diversion of significant operational resources. The results of these lawsuits and actions cannot be predicted with certainty. Management currently believes that the ultimate resolution of these matters will not have a material adverse impact on the financial condition, results of operations or liquidity of the Company. |
Related_Party_Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2013 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions | ' |
Related Party Transactions | |
BGP owned approximately 15.2% of the Company’s outstanding common stock as of March 31, 2013. For the three months ended March 31, 2013 and 2012, the Company recorded revenues from BGP of $0.9 million and $6.1 million, respectively. Total receivables due from BGP were $1.7 million at March 31, 2013. During the three months ended March 31, 2013, the Company paid to BGP $18.4 million for seismic acquisition services provided on a large 3D marine project; the Company owed BGP $5.9 million for those same services at March 31, 2013. | |
For the three months ended March 31, 2013, the Company sold equipment to GeoRXT for $6.4 million, which is due to be paid in May 2013. The purchase of this equipment has been guaranteed by GeoRXT’s majority joint venture partner Georadar. The Company deferred 30% (ION’s ownership percentage in GeoRXT) of its profit on this sale. |
Restructuring_Activities
Restructuring Activities | 3 Months Ended |
Mar. 31, 2013 | |
Restructuring and Related Activities [Abstract] | ' |
Restructuring Activities | ' |
Restructuring Activities | |
At December 31, 2012, the Company had a liability (classified as other long-term liability) of $5.1 million related to its permanently ceasing to use certain leased building facilities. During the three months ended March 31, 2013, the Company made cash payments of $0.3 million and accrued $0.1 million related to accretion expense, resulting in a remaining liability of $4.9 million as of March 31, 2013. |
Segment_Information_Tables
Segment Information (Tables) | 3 Months Ended | |||||||
Mar. 31, 2013 | ||||||||
Segment Reporting [Abstract] | ' | |||||||
Summary of Segment Information | ' | |||||||
A summary of segment information is as follows (in thousands): | ||||||||
Three Months Ended March 31, | ||||||||
2013 | 2012 | |||||||
Net revenues: | ||||||||
Solutions: | ||||||||
New Venture | $ | 48,436 | $ | 28,994 | ||||
Data Library | 9,448 | 10,268 | ||||||
Total multi-client revenues | 57,884 | 39,262 | ||||||
Data Processing | 31,286 | 26,865 | ||||||
Total | $ | 89,170 | $ | 66,127 | ||||
Systems: | ||||||||
Towed Streamer | $ | 13,549 | $ | 15,804 | ||||
Ocean Bottom | 6,765 | 3,519 | ||||||
Other | 11,533 | 17,383 | ||||||
Total | $ | 31,847 | $ | 36,706 | ||||
Software: | ||||||||
Software Systems | $ | 7,941 | $ | 8,370 | ||||
Services | 779 | 507 | ||||||
Total | $ | 8,720 | $ | 8,877 | ||||
Total | $ | 129,737 | $ | 111,710 | ||||
Gross profit: | ||||||||
Solutions | $ | 20,197 | $ | 18,985 | ||||
Systems | 8,380 | 15,812 | ||||||
Software | 6,380 | 6,359 | ||||||
Total | $ | 34,957 | $ | 41,156 | ||||
Gross margin: | ||||||||
Solutions | 23 | % | 29 | % | ||||
Systems | 26 | % | 43 | % | ||||
Software | 73 | % | 72 | % | ||||
Total | 27 | % | 37 | % | ||||
Income from operations: | ||||||||
Solutions | $ | 7,357 | $ | 9,606 | ||||
Systems | 934 | 8,740 | ||||||
Software | 5,161 | 5,482 | ||||||
Corporate and other | (11,529 | ) | (12,185 | ) | ||||
Income from operations | 1,923 | 11,643 | ||||||
Interest expense, net | (1,066 | ) | (1,518 | ) | ||||
Equity in earnings of investments | 1,116 | 2,468 | ||||||
Other income (expense) | 1,027 | (686 | ) | |||||
Income before income taxes | $ | 3,000 | $ | 11,907 | ||||
Equity_Method_Investments_Tabl
Equity Method Investments (Tables) | 3 Months Ended | |||||||||||
Mar. 31, 2013 | ||||||||||||
Equity Method Investments and Joint Ventures [Abstract] | ' | |||||||||||
Schedule of Change in Equity Method Investments | ' | |||||||||||
The following table reflects the change in our equity method investments during the three months ended March 31, 2013 (in thousands): | ||||||||||||
INOVA Geophysical | GeoRXT | Total | ||||||||||
Investment at December 31, 2012 | $ | 73,925 | $ | — | $ | 73,925 | ||||||
Investment in equity | — | 1,500 | 1,500 | |||||||||
Equity in earnings (losses) of investments | 1,851 | (735 | ) | 1,116 | ||||||||
Equity interest in investees' other comprehensive income (loss) | (23 | ) | — | (23 | ) | |||||||
Investments at March 31, 2013 | $ | 75,753 | $ | 765 | $ | 76,518 | ||||||
Equity Method Investments Summarized Financial Information | ' | |||||||||||
The following table reflects the summarized financial information for INOVA Geophysical for the three-month periods ended December 31, 2012 and 2011 (in thousands): | ||||||||||||
Three Months Ended December 31, | ||||||||||||
2012 | 2011 | |||||||||||
Net revenues | $ | 59,611 | $ | 58,998 | ||||||||
Gross profit | $ | 12,327 | $ | 13,964 | ||||||||
Income (loss) from operations | $ | (250 | ) | $ | 6,509 | |||||||
Net income | $ | 3,742 | $ | 5,717 | ||||||||
Inventories_Tables
Inventories (Tables) | 3 Months Ended | |||||||
Mar. 31, 2013 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Summary of Inventories | ' | |||||||
A summary of inventories is as follows (in thousands): | March 31, | December 31, | ||||||
2013 | 2012 | |||||||
Raw materials and subassemblies | $ | 47,709 | $ | 49,421 | ||||
Work-in-process | 7,976 | 8,613 | ||||||
Finished goods | 26,672 | 26,880 | ||||||
Reserve for excess and obsolete inventories | (14,274 | ) | (14,239 | ) | ||||
Total | $ | 68,083 | $ | 70,675 | ||||
Net_Income_per_Share_Tables
Net Income per Share (Tables) | 3 Months Ended | |||||||
Mar. 31, 2013 | ||||||||
Earnings Per Share [Abstract] | ' | |||||||
Computation of basic and diluted net income per common share | ' | |||||||
The following table summarizes the computation of basic and diluted net income per common share (in thousands, except per share amounts): | ||||||||
Three Months Ended March 31, | ||||||||
2013 | 2012 | |||||||
Net income applicable to common shares | $ | 1,537 | $ | 8,237 | ||||
Weighted average number of common shares outstanding | 156,465 | 155,543 | ||||||
Effect of dilutive stock awards | 850 | 1,004 | ||||||
Weighted average number of diluted common shares outstanding | 157,315 | 156,547 | ||||||
Basic net income per share | $ | 0.01 | $ | 0.05 | ||||
Diluted net income per share | $ | 0.01 | $ | 0.05 | ||||
Longterm_Debt_Tables
Long-term Debt (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2013 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
Obligations | ' | ||||||||
Obligations (in thousands) | March 31, | December 31, | |||||||
2013 | 2012 | ||||||||
Revolving line of credit | $ | 97,250 | $ | 97,250 | |||||
Facility lease obligation | 2,139 | 2,334 | |||||||
Equipment capital leases | 5,070 | 5,744 | |||||||
Total | 104,459 | 105,328 | |||||||
Current portion of long-term debt and lease obligations | (3,402 | ) | (3,496 | ) | |||||
Non-current portion of long-term debt and lease obligations | $ | 101,057 | $ | 101,832 | |||||
Fair_Value_of_Financial_Instru1
Fair Value of Financial Instruments (Tables) | 3 Months Ended | |||||||||||
Mar. 31, 2013 | ||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||
Assets and liabilities measured at fair value on a recurring basis | ' | |||||||||||
The following table provides additional information related to assets measured at fair value on a recurring basis at March 31, 2013 and December 31, 2012. The reference to level within the table relates to the level of inputs used to determine fair value, which the key inputs are then described below. The table is as follows (amounts in thousands): | ||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||
As of March 31, 2013: | ||||||||||||
Investment in convertible notes | $ | — | $ | — | $ | 9,127 | ||||||
As of December 31, 2012: | ||||||||||||
Investment in convertible note | — | — | 8,195 | |||||||||
Basis_of_Presentation_Restatem
Basis of Presentation Restatement (Details) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2013 | Mar. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2011 |
Accounts payable, accrued expenses and accrued royalties | ($13,373) | ($13,025) | ' | ' |
Net cash provided by operating activities | 49,591 | 51,840 | ' | ' |
Investment in multi-client data library | -28,778 | -24,527 | ' | ' |
Purchase of property, plant and equipment | -3,774 | -1,768 | ' | ' |
Net cash used in investing activities | -42,976 | -6,295 | ' | ' |
Net increase (decrease) in cash and cash equivalents | 5,604 | 44,694 | ' | ' |
Cash and cash equivalents at end of period | 66,575 | 87,096 | 60,971 | 42,402 |
As Reported | ' | ' | ' | ' |
Accounts payable, accrued expenses and accrued royalties | -28,686 | ' | ' | ' |
Net cash provided by operating activities | 34,278 | ' | ' | ' |
Investment in multi-client data library | -13,270 | ' | ' | ' |
Purchase of property, plant and equipment | -3,969 | ' | ' | ' |
Net cash used in investing activities | -27,663 | ' | ' | ' |
Net increase (decrease) in cash and cash equivalents | 5,604 | ' | ' | ' |
Cash and cash equivalents at end of period | 66,575 | ' | ' | ' |
Adjustment | ' | ' | ' | ' |
Accounts payable, accrued expenses and accrued royalties | 15,313 | ' | ' | ' |
Net cash provided by operating activities | 15,313 | ' | ' | ' |
Investment in multi-client data library | -15,508 | ' | ' | ' |
Purchase of property, plant and equipment | 195 | ' | ' | ' |
Net cash used in investing activities | -15,313 | ' | ' | ' |
Net increase (decrease) in cash and cash equivalents | 0 | ' | ' | ' |
Cash and cash equivalents at end of period | $0 | ' | ' | ' |
Segment_Information_Details
Segment Information (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2013 | Mar. 31, 2012 |
Summary of segment information | ' | ' |
Revenues | $129,737 | $111,710 |
Gross profit | 34,957 | 41,156 |
Gross margin | 27.00% | 37.00% |
Income from operations | 1,923 | 11,643 |
Interest expense, net | -1,066 | -1,518 |
Equity in earnings of investments | 1,116 | 2,468 |
Other income (expense) | 1,027 | -686 |
Income before income taxes | 3,000 | 11,907 |
Solutions [Member] | ' | ' |
Summary of segment information | ' | ' |
Revenues | 89,170 | 66,127 |
Gross profit | 20,197 | 18,985 |
Gross margin | 23.00% | 29.00% |
Income from operations | 7,357 | 9,606 |
Systems [Member] | ' | ' |
Summary of segment information | ' | ' |
Revenues | 31,847 | 36,706 |
Gross profit | 8,380 | 15,812 |
Gross margin | 26.00% | 43.00% |
Income from operations | 934 | 8,740 |
Software [Member] | ' | ' |
Summary of segment information | ' | ' |
Revenues | 8,720 | 8,877 |
Gross profit | 6,380 | 6,359 |
Gross margin | 73.00% | 72.00% |
Income from operations | 5,161 | 5,482 |
Corporate and Other [Member] | ' | ' |
Summary of segment information | ' | ' |
Income from operations | -11,529 | -12,185 |
New Venture and Data Library [Member] | Solutions [Member] | ' | ' |
Summary of segment information | ' | ' |
Revenues | 57,884 | 39,262 |
New Venture [Member] | Solutions [Member] | ' | ' |
Summary of segment information | ' | ' |
Revenues | 48,436 | 28,994 |
Data Library [Member] | Solutions [Member] | ' | ' |
Summary of segment information | ' | ' |
Revenues | 9,448 | 10,268 |
Data Processing [Member] | Solutions [Member] | ' | ' |
Summary of segment information | ' | ' |
Revenues | 31,286 | 26,865 |
Towed Streamer [Member] | Systems [Member] | ' | ' |
Summary of segment information | ' | ' |
Revenues | 13,549 | 15,804 |
Ocean Bottom [Member] | Systems [Member] | ' | ' |
Summary of segment information | ' | ' |
Revenues | 6,765 | 3,519 |
Other [Member] | Systems [Member] | ' | ' |
Summary of segment information | ' | ' |
Revenues | 11,533 | 17,383 |
Software Systems [Member] | Software [Member] | ' | ' |
Summary of segment information | ' | ' |
Revenues | 7,941 | 8,370 |
Services [Member] | Software [Member] | ' | ' |
Summary of segment information | ' | ' |
Revenues | $779 | $507 |
Equity_Method_Investments_Chan
Equity Method Investments Changes in Equity Method Investments (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2013 | Mar. 31, 2012 |
Schedule of Equity Method Investments [Line Items] | ' | ' |
Investment, beginning balance | $73,925 | ' |
Investment in equity | 1,500 | ' |
Equity in earnings (losses) of investments | 1,116 | 2,468 |
Equity interest in investees' other comprehensive income (loss) | -23 | ' |
Investment, ending balance | 76,518 | ' |
INOVA Geophysical [Member] | ' | ' |
Schedule of Equity Method Investments [Line Items] | ' | ' |
Investment, beginning balance | 73,925 | ' |
Investment in equity | 0 | ' |
Equity in earnings (losses) of investments | 1,851 | ' |
Equity interest in investees' other comprehensive income (loss) | -23 | ' |
Investment, ending balance | 75,753 | ' |
GeoRXT [Member] | ' | ' |
Schedule of Equity Method Investments [Line Items] | ' | ' |
Investment, beginning balance | 0 | ' |
Investment in equity | 1,500 | ' |
Equity in earnings (losses) of investments | -735 | ' |
Equity interest in investees' other comprehensive income (loss) | 0 | ' |
Investment, ending balance | $765 | ' |
Equity_Method_Investments_Narr
Equity Method Investments Narrative (Details) (USD $) | 3 Months Ended | 3 Months Ended | ||||
Mar. 31, 2013 | Mar. 31, 2012 | Mar. 31, 2013 | Feb. 19, 2013 | Mar. 31, 2013 | Mar. 31, 2013 | |
GeoRXT [Member] | GeoRXT [Member] | INOVA Geophysical [Member] | Optional Increase in Ownership [Member] | |||
GeoRXT [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ' | ' | ' | ' | ' | ' |
Percentage of equity method investment | ' | ' | ' | 30.00% | 49.00% | 50.00% |
Optional capital contribution to GeoRXT to increase ownership percentagel | $9,500,000 | $0 | ' | ' | ' | $40,000,000 |
Amount of purchased interest in joint venture entity | ' | ' | ' | 1,500,000 | ' | ' |
Amount of short-term working capital loan to related party | ' | ' | ' | 8,000,000 | ' | ' |
Equity in earnings (losses) of investments | $1,116,000 | $2,468,000 | ($735,000) | ' | $1,851,000 | ' |
Equity_Method_Investments_Inco
Equity Method Investments Income (Loss) (Details) (INOVA Geophysical [Member], USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 |
INOVA Geophysical [Member] | ' | ' |
Schedule of Equity Method Investments [Line Items] | ' | ' |
Net revenues | $59,611 | $58,998 |
Gross profit | 12,327 | 13,964 |
Income (loss) from operations | -250 | 6,509 |
Net income | $3,742 | $5,717 |
Inventories_Details
Inventories (Details) (USD $) | Mar. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Summary of Inventories | ' | ' |
Raw materials and subassemblies | $47,709 | $49,421 |
Work-in-process | 7,976 | 8,613 |
Finished goods | 26,672 | 26,880 |
Reserve for excess and obsolete inventories | -14,274 | -14,239 |
Total | $68,083 | $70,675 |
Narrative_Details
Narrative (Details) | Mar. 31, 2013 | Mar. 31, 2012 |
Earnings Per Share [Abstract] | ' | ' |
Number of shares issued or committed for issuance under outstanding stock options | 7,717,937 | 6,832,575 |
Number of shares of restricted stock and shares reserved for restricted stock units outstanding | 1,034,280 | 1,168,001 |
Number of outstanding shares of Series D Cumulative Convertible Preferred Stock | 27,000 | ' |
Number of shares of common stock | 6,065,075 | ' |
Basic_and_Diluted_Per_Share_De
Basic and Diluted Per Share (Details) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2013 | Mar. 31, 2012 |
Earnings Per Share [Abstract] | ' | ' |
Net income applicable to common shares | $1,537 | $8,237 |
Weighted average number of common shares outstanding | 156,465 | 155,543 |
Effect of dilutive stock awards and convertible preferred stock | 850 | 1,004 |
Weighted average number of diluted common shares outstanding | 157,315 | 156,547 |
Basic net income per share | $0.01 | $0.05 |
Diluted net income per share | $0.01 | $0.05 |
Longterm_Debt_Obligations_Deta
Long-term Debt Obligations (Details) (USD $) | Mar. 31, 2013 | Dec. 31, 2012 | 29-May-12 |
In Thousands, unless otherwise specified | |||
Obligations | ' | ' | ' |
Revolving line of credit | $97,250 | $97,250 | $98,300 |
Facility lease obligation | 2,139 | 2,334 | ' |
Equipment capital leases | 5,070 | 5,744 | ' |
Total | 104,459 | 105,328 | ' |
Current portion of long-term debt and lease obligations | -3,402 | -3,496 | ' |
Non-current portion of long-term debt and lease obligations | $101,057 | $101,832 | ' |
Longterm_Debt_Narrative_Detail
Long-term Debt Narrative (Details) (USD $) | 1 Months Ended | 3 Months Ended | ||
Mar. 31, 2010 | Mar. 31, 2013 | Dec. 31, 2012 | 29-May-12 | |
Long-term Debt and Interest Rate Caps (Textual) [Abstract] | ' | ' | ' | ' |
Outstanding term loan indebtedness under Credit Facility | ' | $97,250,000 | $97,250,000 | $98,300,000 |
Accrued interest on credit facility | ' | 2.71% | ' | ' |
Fixed charge coverage ratio | ' | 1.125 | ' | ' |
Leverage ratio | ' | 3.25 | ' | ' |
Percentage of tangible net worth for covenants compliance | 60.00% | ' | ' | ' |
Line of Credit Facility [Member] | ' | ' | ' | ' |
Long-term Debt and Interest Rate Caps (Textual) [Abstract] | ' | ' | ' | ' |
Debt instrument basis spread on variable rate under option one | ' | 0.50% | ' | ' |
Debt instrument basis spread on variable rate under option two | ' | 1.00% | ' | ' |
Debt instrument basis spread on variable rate under option three | 2.50% | 1.40% | ' | ' |
Line of Credit Facility [Member] | Eurodollar Borrowing [Member] | ' | ' | ' | ' |
Long-term Debt and Interest Rate Caps (Textual) [Abstract] | ' | ' | ' | ' |
Debt instrument basis spread on variable rate under option one | 3.50% | 2.40% | ' | ' |
First Amendment [Member] | ' | ' | ' | ' |
Long-term Debt and Interest Rate Caps (Textual) [Abstract] | ' | ' | ' | ' |
Revolving line of credit, Maximum | ' | $175,000,000 | ' | ' |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2013 | Mar. 31, 2012 |
Income Tax Disclosure [Abstract] | ' | ' |
Unreserved portion of deferred tax assets | $13.80 | ' |
Effective income tax rates | 40.00% | 28.90% |
Tax expense adjustment | 1.2 | ' |
Discrete items (benefits) recognized during period | -0.9 | ' |
Effective income tax rate, excluding expense adjustment and discrete benefits | 28.90% | ' |
Unrecognized tax benefits | $1.80 | ' |
Fair_Value_of_Financial_Instru2
Fair Value of Financial Instruments Assets Measured on Recurring Basis (Details) (Convertible Debt Securities [Member], Recurring Basis [Member], USD $) | Mar. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Level 1 [Member] | ' | ' |
Assets and liabilities measured at fair value on a recurring basis | ' | ' |
Available-for-sale investments, fair value | $0 | $0 |
Level 2 [Member] | ' | ' |
Assets and liabilities measured at fair value on a recurring basis | ' | ' |
Available-for-sale investments, fair value | 0 | 0 |
Level 3 [Member] | ' | ' |
Assets and liabilities measured at fair value on a recurring basis | ' | ' |
Available-for-sale investments, fair value | $9,127 | $8,195 |
Fair_Value_of_Financial_Instru3
Fair Value of Financial Instruments Narrative (Details) (USD $) | 1 Months Ended | 3 Months Ended | ||||
Mar. 31, 2012 | Mar. 31, 2013 | Dec. 31, 2012 | Mar. 31, 2013 | Mar. 31, 2013 | Mar. 31, 2013 | |
Convertible Debt Securities [Member] | Credit Facility Receivable [Member] | Estimate of Fair Value, Fair Value Disclosure [Member] | ||||
Convertible Debt Securities [Member] | ||||||
Fair Value of Financial Instruments (Textual) [Abstract] | ' | ' | ' | ' | ' | ' |
Carrying value of long-term debt | ' | $104,459,000 | $105,328,000 | ' | ' | ' |
Fair value of long-term debt | ' | 104,600,000 | 105,300,000 | ' | ' | ' |
Fair Value of Financial Instruments (Additional Textual) [Abstract] | ' | ' | ' | ' | ' | ' |
Principal amount of convertible note | ' | ' | ' | 6,500,000 | ' | ' |
Interest rate on convertible note | ' | ' | ' | 4.00% | ' | ' |
Credit facility to investee | 4,000,000 | ' | ' | ' | ' | ' |
Available-for-sale investments, fair value | ' | ' | ' | ' | 3,000,000 | 9,100,000 |
Unrealized losses | ' | ' | ' | $400,000 | ' | ' |
Litigation_Details
Litigation (Details) (USD $) | 1 Months Ended | 1 Months Ended | ||||||
In Millions, unless otherwise specified | Mar. 31, 2011 | Jun. 30, 2009 | Jun. 30, 2009 | Mar. 31, 2013 | 31-May-12 | Aug. 16, 2012 | Aug. 16, 2012 | Aug. 16, 2012 |
mi | Patent | WesternGeco [Member] | WesternGeco [Member] | Fletcher [Member] | Pending Litigation [Member] | Lost Royalties [Member] | Lost Profits [Member] | |
Patent | WesternGeco [Member] | Pending Litigation [Member] | Pending Litigation [Member] | |||||
WesternGeco [Member] | WesternGeco [Member] | |||||||
Litigation (Textual) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Number of patent apparatus claims contained | ' | 4 | 4 | ' | ' | ' | ' | ' |
Minimum distance from coast to make alleged activities not actionable under patent infringement law | 12 | ' | ' | ' | ' | ' | ' | ' |
Total damages awarded | ' | ' | ' | ' | ' | $105.90 | $12.50 | $93.40 |
Probable estimated loss contingency | ' | ' | ' | 10 | ' | ' | ' | ' |
Principal amount of promissory note | ' | ' | ' | ' | $35 | ' | ' | ' |
Related_Party_Transactions_Det
Related Party Transactions (Details) (USD $) | 3 Months Ended | |||
In Millions, unless otherwise specified | Mar. 31, 2013 | Mar. 31, 2012 | Mar. 31, 2013 | Feb. 19, 2013 |
BGP Joint Venture [Member] | BGP Joint Venture [Member] | GeoRXT [Member] | GeoRXT [Member] | |
Property Subject to or Available for Operating Lease [Line Items] | ' | ' | ' | ' |
Company's outstanding common stock owned by BGP | 15.20% | ' | ' | ' |
Related party transaction, revenues from transactions with related party | $0.90 | $6.10 | ' | ' |
Receivables due from BGP | 1.7 | ' | ' | ' |
Paid to related party for seismic acquisition services | 18.4 | ' | 6.4 | ' |
Owed to related party for unpaid services | $5.90 | ' | ' | ' |
Percentage of equity method investment | ' | ' | ' | 30.00% |
Restructuring_Activities_Detai
Restructuring Activities (Details) (Facility Closing [Member], USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2013 | Dec. 31, 2012 |
Facility Closing [Member] | ' | ' |
Restructuring Activities (Textual) [Abstract] | ' | ' |
Restructuring liability reserve | $4.90 | $5.10 |
Cash payments for restructuring liability | 0.3 | ' |
Accrued accretion expense | $0.10 | ' |