“The company’s balance sheet remains strong. We ended the quarter with $159 million of working capital, $65 million of cash and short-term investments, and no long-term debt on our balance sheet. Our $25 million credit facility remains untouched at this time, resulting in total liquidity of $90 million at the end of the first quarter. We are in good shape to continue the production of the Statoil order, expand our OBX inventories, and invest in new product opportunities.”

Geospace Technologies Corporation designs and manufactures instruments and equipment used by the oil and gas industry in the acquisition and processing of seismic data as well as in reservoir characterization and monitoring activities. The company also designs and manufactures non-seismic products, including industrial products, offshore cables, thermal printing equipment and film.

This press release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact included herein including statements regarding potential future products and markets, our potential future revenues, future financial position, business strategy, future expectations and estimates and other plans and objectives for future operations, are forward-looking statements. We believe our forward-looking statements are reasonable. However, they are based on certain assumptions about our industry and our business that may in the future prove to be inaccurate. Important factors that could cause actual results to differ materially from our expectations include the level of seismic exploration worldwide, which is influenced primarily by prevailing prices for oil and gas, the extent to which our new products are accepted in the market, the availability of competitive products that may be more technologically advanced or otherwise preferable to our products, tensions in the Middle East and other factors disclosed under the heading “Risk Factors” and elsewhere in our most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q, which are on file with the Securities and Exchange Commission. Further, all written and verbal forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by such factors.



(in thousands, except share and per share amounts)

Three Months Three Months
Ended Ended

December 31, 2012

December 31, 2011
Sales $ 77,751 $ 43,281
Cost of sales   37,187     22,623  
Gross profit 40,564 20,658
Operating expenses:
Selling, general and administrative expenses 5,363 4,735
Research and development expenses 3,365 2,889
Bad debt expense   269     436  
Total operating expenses   8,997     8,060  
Loss on disposal of equipment   (19 )   --  
Income from operations   31,548     12,598  
Other income (expense):
Interest expense (85 ) --
Interest income 229 267
Foreign exchange gains 46 122
Other, net   (16 )   (55 )
Total other income, net   174     334  
Income before income taxes 31,722 12,932
Income tax expense   9,709     4,247  
Net income $ 22,013   $ 8,685  
Basic earnings per common share $ 1.72   $ 0.68  
Diluted earnings per common share $ 1.70   $ 0.68  
Weighted average common share outstanding - Basic   12,827,918     12,704,538  

Weighted average common share outstanding - Diluted



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