TGS Surges as Strong Late Sales Boost 2013 Revenues: Oslo Mover

TGS Nopec Geophysical ASA, Norway’s largest surveyor of underwater oil and gas fields, rose the most in more than five years in Oslo as better than estimated fourth-quarter sales allayed investor concerns about a slowdown.

Shares in the Asker-based company surged as much as 18 percent to 173 kroner, the biggest intraday gain since Dec. 8, 2008, and traded at 165.4 kroner as of 1:20 p.m. in the Norwegian capital. That makes TGS the biggest mover today on the Stoxx Europe 600 index.

“This is particularly strong in an environment in which almost all peers have indicated a challenging fourth-quarter,” DNB ASA analysts led by Mats Olimb said in a note. Guidance for 2014 was “slightly better than expected” and “preliminary estimate changes for 2014 are likely to see earnings per share up 5 percent to 6 percent,” the analysts wrote.

Oil-service companies including surveyors, which use ships to search for petroleum reserves under the seabed, are suffering from falling demand as explorers cut back in the face of rising spending and costs. Petroleum Geo-Services ASA, the second-largest Norwegian surveyor by market capitalization, and CGG SA, the largest seismic company, have both cut their earnings guidance for 2013.

TGS expects to report net revenue this year of $870 million to $950 million, up from an estimated $882 million in 2013, the company said today. That compares with earlier guidance for last year of as much as $870 million, TGS said. “The positive deviation is mainly caused by record high late sales in the fourth quarter,” the company said.

Seismic companies earn money in the multi-client market, where a surveyor builds a data library that’s then sold to explorers, and through specific studies for customers, both of which can be pre-funded.

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