Petroleum Geo Expects Lower 2011 Profit Than Analysts Estimate

Petroleum Geo-Services ASA (PGS), the world’s third-biggest surveyor of oil and gas fields, predicted a profit for this year which was lower than analysts estimated and said it will cut costs.

Earnings before interest, taxes, depreciation and amortization will be “slightly” below $525 million as utilization and productivity is weak in the current quarter, the Lysaker, Norway-based company said today in a statement. The average estimate in a Bloomberg survey of 25 analysts was a 2011 Ebitda of $529 million.

PGS raised in October its 2011 Ebitda forecast to $525 million from $500 million citing better results at its non- exclusive, or multiclient, user licenses in the North Sea. The company said today that profit by the same measure will rise to a range of $650 million to $700 million next year. That compares with an average estimate of $671 million in the Bloomberg survey.

The company’s cost cut plan will save $50 million by the end of next year of which half is included in its forecast for 2012, PGS said, without providing more details.

“This program with its renewed focus on cost and fleet performance will deliver margin uplift,” Jon Erik Reinhardsen, the company’s chief executive officer, said in the statement.

PGS said it expects multiclient cash investments of $300 million to $325 million next year and capital expenditures of $350 million to $400 million.

PGS holds a capital markets day today.

To contact the editor responsible for this story: Meera Bhatia at mbhatia2@bloomberg.net

To contact the editor responsible for this story: Christian Wienberg at cwienberg@bloomberg.net

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