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HOUSTON, Jan. 28 /PRNewswire-FirstCall/ — Input/Output, Inc. (NYSE: IO)
today announced a net loss applicable to common shareholders for the fourth
quarter ended December 31, 2002 of $6.5 million, or $(0.13) per share, on
revenue of $37.0 million, compared to a net loss applicable to common
shareholders of $29.4 million, or $(0.58) per share, on revenue of
$28.5 million last quarter and net income applicable to common shareholders of
$0.6 million, or $0.01 per share, on revenue of $51.1 million for the same
period a year ago. Included in this quarter’s net loss applicable to common
shareholders are pretax charges of $1.7 million related to severance payments
and workforce reductions and $1.0 million for the closure of our Norwich, U.K.
and Alvin, Texas facilities.

For the year ended December 31, 2002, Input/Output recorded a net loss
applicable to common shareholders of $120.8 million, or $(2.37) per share, on
revenue of $118.6 million, compared to net earnings applicable to common
shareholders of $3.7 million, or $0.07 per share, on revenue of $212.1 million
for the same period a year ago. Included in this year’s net loss applicable
to common shareholders are pretax charges of $3.5 million related to severance
payments and workforce reduction, $4.3 million related to the discontinuance
of certain products, $8.2 million for the closure of facilities, $15.1 million
for impairment of goodwill related to our analog land seismic operations, and
$61.0 million for additional reserves for our deferred tax assets.

Land and marine division revenues during the fourth quarter were
$20.4 million and $16.6 million, respectively, compared to $16.4 million and
$12.1 million, respectively, during the third quarter and $42.1 million and
$9.0 million, respectively, for the same period a year ago. Land and marine
division revenues during the year ended December 31, 2002 were $65.2 million
and $53.4 million, respectively, compared to $162.3 million and $49.8 million,
respectively, for the same period a year ago.

“Our fourth quarter results reflect another sequential improvement in the
Company’s revenues and operating performance,” said C. Robert Bunch, the
Company’s President. “Our VectorSeis(R) platform for digital seismic data
acquisition is gaining traction in land surface, ocean-bottom and in-well
applications. We will deliver our first radio-based VectorSeis System
Four(TM) to BGP this quarter, and are on schedule for the release of our
cable-based system early in the second quarter.”

Mr. Bunch continues, “Our focus on reducing both our products’ unit costs
and our fixed cost structure remains unabated. Together with the success of
our VectorSeis product launches and a steady improvement in our traditional
analog business, we are optimistic that revenues will continue to increase and
that we will return to profitability in 2003.”

Input/Output, Inc. is an industry leader in seismic acquisition imaging
technology for land, marine, transition zone exploration, production and
reservoir monitoring. The Company specializes in technology that creates
value for the energy industry in the areas of 2D, 3D, 4D and multi-component
seismic data. Additional information on Input/Output, Inc. is available on the
Internet at http://www.i-o.com or contact us at ir@i-o.com.

The information included herein contains certain forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. These forward-looking
statements include statements concerning the Company’s revenue and earnings
projections for 2003, any statement concerning future business fundamentals
for the seismic industry, scheduled new product offerings and expected
continued investment in new technology. Actual results may vary materially
from those described in these forward-looking statements. All forward-looking
statements reflect numerous assumptions and involve a number of risks and
uncertainties. These risks and uncertainties include a continuation in trends
for energy industry demand for seismic services and products; the timing and
development of the Company’s products and services and market acceptance of
the Company’s new and revised product offerings; risks associated with
competitors’ product offerings and pricing pressures resulting therefrom; the
Company’s inability to produce products to preserve and increase market share;
technological and marketplace changes affecting the Company’s product line;
risks associated with sales of products to customers outside the United
States; future energy exploration industry conditions and future prices
worldwide for oil and natural gas. Additional risk factors which could affect
actual results are disclosed by the Company from time to time in its filings
with the Securities and Exchange Commission.


                     INPUT/OUTPUT, INC. AND SUBSIDIARIES
                    CONSOLIDATED STATEMENTS OF OPERATIONS
               (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
                                 (UNAUDITED)


                            Three Months Ended              Year Ended
                                December 31,               December 31,
                           2002              2001         2002        2001
    Net sales         $   36,981         $  51,126    $  118,583   $ 212,050
    Cost of sales         31,240            31,503        99,624     138,415
       Gross profit        5,741            19,623        18,959      73,635

    Operating expenses:
     Research and
      development          6,318             7,547        28,756      29,442
     Marketing and
      sales                3,288             3,213        11,218      11,657
     General and
      administrative       4,458             5,594        19,160      19,695
     Amortization of
      intangibles            387              1,390        1,394       4,936
     Impairment of
      goodwill and
      long-lived assets    1,004                 --       21,996          --

       Total operating
        expenses          15,455             17,744       82,524      65,730

    Earnings (loss)
     from operations      (9,714)             1,879      (63,565)      7,905

    Interest expense      (1,381)               (50)      (3,124)       (695)
    Interest income          525                811        2,280       4,685
    Other income             973                516        2,454         574
    Earnings (loss)
     before income
     taxes                (9,597)             3,156      (61,955)     12,469
    Income tax expense
     (benefit)            (3,078)             1,084       57,919       3,128
    Net earnings (loss)   (6,519)             2,072     (119,874)      9,341
    Preferred dividend        --              1,431          947       5,632
    Net earnings (loss)
     applicable to
     common shares    $   (6,519)        $      641   $ (120,821)  $   3,709

    Basic earnings
     (loss) per
     common share     $    (0.13)        $     0.01   $    (2.37)  $    0.07
    Weighted average
     number of
     common shares
     outstanding      51,101,765         51,126,143   51,014,505  51,166,026

    Diluted earnings
     (loss) per
      common share    $    (0.13)        $     0.01   $    (2.37)  $    0.07
    Weighted average
     number of
     diluted common
     shares
     outstanding      51,101,765         51,850,174   51,014,505  52,308,578

SOURCE Input/Output, Inc.

CONTACT: C. Robert Bunch, President, Input/Output, Inc.,
+1-281-933-3339