CGG lowers 2022 guidance after “weak” 3Q

French oil and gas group CGG cut its losses in the third quarter, but lowered its annual revenue forecast, suffering from the postponement of some of its clients’ projects amid geopolitical uncertainties.

Benefiting from an accounting effect, the net loss decreased to $2 million in the third quarter from $16 million in the same period last year, according to a statement released Wednesday by the oil and gas geosciences specialist.

In the previous quarter, however, the company had managed to return to the black with a $16 million profit.

Reported sales rose by 21% to $255 million, but sales before accounting adjustments fell by 20% year-on-year.

As a result of this “weak” quarter, the group expects sales to be stable in 2022, compared to the 10% increase announced until now.

Operating profit, before accounting adjustments, fell by 23%.

“Short-term macro and geopolitical uncertainties have led to increased volatility and postponements of some client projects,” commented group CEO Sophie Zurquiyah, who nevertheless expects a “solid fourth half of the year.”

These postponements to the third quarter or 2023 concern, for example, projects in the North Sea, Brazil, the Middle East or North Africa.

The sanctions on Russia alone, which will result in delivery bans, will cut $50 million from CGG’s revenues this year, according to the company.