Dawson Geophysical Company

Good morning and welcome to the Dawson Geophysical Second Quarter 2021 conference call. Today's conference is being recorded. As a reminder, statements made by management during this call with respect to forecasts, estimates, or other expectations regarding future events or which provide any information other than historical facts may constitute as forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's current expectation and include known and unknown risks, uncertainties, and other factors, many of which the company is unable to predict or control that may cause the company's actual future results or performance to materially differ from any future results of performance expressed or implied by those statements. These risks and uncertainties include the risk factors disclosed by the company from time to time and its filings with the SEC, including the company's annual report on Form 10-K, filed with the SEC on March 16, 2021, and any subsequent quarterly reports on Form 10-Q, filed with the SEC. Furthermore, as we start this call, please refer to the statements regarding forward-looking statements incorporated in the company's press release issued this morning, and please note that the contents of the company's conference call this morning is covered by those statements. During this conference call, management will make references to EBITDA, which is a non-GAAP financial measure. A reconciliation of the non-GAAP measure to the applicable GAAP measure can be found in the company's current earnings release, a copy of which is located on the company's website at www.dawson3d.com. The call is scheduled for 30 minutes and the company will not provide any guidance. I would now like to turn the call over to Mr. Steven Jumper, Chairman, President, and CEO of Dawson Geophysical Company. Please go ahead, sir.

Well, thank you, Cody. Good morning and welcome to Dawson Geophysical Company's second quarter 2021 earnings and operations update conference call. As Cody said, my name is Steve Jumper, Chairman, President, and CEO of the company. Joining me on the call is Jim Bratta, Executive Vice President and Chief Financial Officer. Before We start the call, just a few things to cover. As Cody said, if you'd like to listen to a replay of today's call, it will be available via webcast by going to the investor relations section of the company's website at www.dawson3d.com. Information reported on this call speaks only of today, Thursday, August 12, 2021, and therefore you are advised that time-sensitive information may no longer be accurate. as of the time of any replay listening. Turning to our preliminary second quarter ended June 30, 2021 financial results. For the second quarter ended June 30, 2021, the company reported revenues of $193,000, a significant decrease compared to $29.5 million for the quarter ended June 30, 2020. For the second quarter of 2021, the company reported a net loss of $9 million or $0.38 loss per share of common stock compared to net income of $1.5 million or $0.06 per share of common stock for the quarter ended June 30, 2020. The company reported negative EBITDA of $5.7 million for the quarter ended June 30, 2021 compared to positive EBITDA of $5.8 million for the quarter into June 30, 2020. Activity levels during the second quarter of 2021 reached a low point as the company did not have a seismic data acquisition crew operating in either the United States or in Canada as the Canadian season concluded at the end of the first quarter. The near-term outlook for seismic data acquisition activity in the U.S. remains challenging with the company currently operating one midsize channel count crew. Based on currently available information, the company anticipates operating one crew in the U.S. during the second half of 2021 with periods of low utilization and potentially one crew in Canada during the fourth quarter. I will now turn control of the call over to Jim Braddock. who will review the financial results. Then I will return for some final remarks and our outlook in the third and fourth quarter of 21. Jim?

Thank you, Steve, and good morning. Revenues for the second quarter of 2021 were $193,000, a significant decrease compared to $29.5 million for the quarter ended June 30, 2020. As stated in our earnings release issued this morning, during the second quarter of 2021, The company did not have a seismic data acquisition crew operating in either the U.S. or in Canada as the Canadian season concluded at the end of the first quarter. The near-term outlook for seismic data acquisition activity in the U.S. remains challenging, with the company currently operating one mid-sized channel count crew. Based on currently available information, the company anticipates operating one crew in the U.S. during the second half of 2021, with periods of low utilization, and potentially one crew in Canada during the fourth quarter. Cost of services in the second quarter of 2021 was $3.3 million, a decrease of 83%, compared to $19.7 million in the same quarter of 2020. General and administrative expenses were $2.7 million in the second quarter of 2021, a decrease of 36%, compared to 4.3 million in the second quarter of 2020. Depreciation and amortization expense in the second quarter of 2021 was 3.4 million, a decrease of 22% compared to 4.4 million in the same quarter of 2020. Net loss in the second quarter of 2021 was 9 million or 38 cent loss per common share, compared to net income of 1.5 million or six cents per common share in the second quarter of 2020. EBITDA in the second quarter of 2021 was negative 5.7 million compared to positive EBITDA of 5.8 million in the same period of 2020. And EBITDA reconciliation was provided in our earnings release issued this morning. Now I'll review some results for the six months ended June 30th, 2021. Revenues for the six months ended June 30th, 2021 were $11.9 million, a decrease of approximately 83 percent compared to $68.5 million for the six months ended June 30th, 2020. Cost of services for the six months ended June 30th, 2020 was $14.3 million, a decrease of 71 percent compared to $48.7 million in the same period of 2020. General and administrative expenses were 5.6 million for the six months ended June 30th, 2021, a decrease of 30% compared to 7.9 million in the same period a year ago. Net loss for the six months ended June 30th, 2021 was 14.2 million or 61 cent loss per common share compared to net income of 2.5 million or 11 cents per common share for the six months ended June 30th, 2020. EBITDA for the six months ended June 30th, 2021 was negative 7.5 million compared to positive EBITDA of 11.6 million in the same period of 2020. And again, EBITDA reconciliation was provided in our earnings release issued this morning. Now I'll turn to some balance sheet items. Our balance sheet continues to remain strong. And as of June 30th, 2021, we had debt, including obligations under financing leases, of $427,000. Cash and short-term investments of $45.9 million. Our current ratio was 10.6 to 1. And working capital was approximately $44.4 million. And with that, I'll turn the call back to Steve for some comments on our operations.