Geospace Technologies (NASDAQ: GEOS) today announced net income of $10.8 million, or $0.82 per diluted share, on revenues of $68.6 million for its fiscal quarter ended March 31, 2014. This compares with a net income of $16.9 million, or $1.30 per diluted share, on revenues of $76.4 million for the comparable quarter last year.
For the six months ended March 31, 2014, the company recorded revenues of $169.9 million and net income of $35.0 million, or $2.66 per diluted share. For the comparable period last year, the company recorded revenues of $154.2 million and a net income of $38.9 million, or $3.01 per diluted share.
Walter R. Wheeler, Geospace Technologies’ President and CEO said, “Revenues and net income for the second quarter of our fiscal year saw respective reductions of 10% and 36% compared to the second quarter of last year. The lower quarterly revenues reflect reduced demand and deliveries for each of our product segments during the quarter. Lower product demand in our traditional and wireless product segments can be largely attributed to continued softness in the land seismic market, particularly in North America.”
“Sales of our traditional products declined sequentially from the first quarter and from last year due to a reduction in geophone sales, which often accompany large orders for our wireless data acquisition systems. Partially offsetting this decrease in sales was an increase in demand for our marine products. We expect demand for our other traditional products to remain soft for the remainder of the fiscal year.”“GSX product sales were significantly lower than expected and were mostly comprised of low margin replacement parts and battery upgrades, with relatively few new channels sold during the quarter. Offsetting this low sales activity was a record quarter from our GSX rental operations. We are pleased to report that approximately 100,000 GSX channels were rented at March 31, 2014, helping us generate record rental revenues for the second quarter. The rental revenue contribution and channel utilization would have been better had our customers not experienced startup delays in both the Canadian and South American markets. We are pleased with the expanding utilization of our GSX products in North and South America and in Eastern Europe, and we look forward to increased opportunities developing new customer relationships in these and other regions. Since its inception and through March 31, 2014, we have sold 316,000 GSX channels and we had 133,000 GSX channels in our worldwide rental fleet.”