Petroleum Geo-Services ASA (OSL:PGS) Third Quarter 2008 Results

Petroleum Geo-Services ASA (OSL:PGS) Best Quarter Ever

With Record Order Book

October 24, 2008: OSLO, NORWAY - Petroleum Geo-Services ASA ("PGS" or the "Company") today announced its best quarter ever with an increase in revenues and earnings before interest and tax ("EBIT") of 15% and 12% respectively from previous records. The order book increased in the quarter to $1,193 million.

§ Record order book: Order book at the end of Q3 2008 was $933 million for Marine and $260 million for Onshore, up a total of 10% from Q2 2008.

§ Strong Group performance: Revenues of $534.3 million, up $95.2 million (22%) from Q3 2007 and $69.2 million from previous record set in Q2 2008. EBIT of $187.8 million, up $20.4 million (12%) compared to the record set in Q3 2007.

§ Marine: EBIT of $202.4 million in Q3 2008, up $20.0 million (11%) from Q3 2007, driven primarily by good operations and a slight net increase in capacity as a result of Ramform Sovereign entering the fleet in March 2008 and Ramform Victory exiting the fleet going to "METI" late January 2008.

§ Onshore: EBIT was $4.2 million in Q3 2008, up $8.4 million from Q3 2007, caused primarily by a higher activity level in Latin America, redeploying a crew in Alaska and higher MultiClient pre-funding sales.

Jon Erik Reinhardsen, President and Chief Executive Officer of PGS, commented:

"We delivered the strongest quarterly operating profit ever. Our order book of approximately $1.2 billion, combined with our sound profitability and competitive operations, provide a strong platform going forward. In addition, we have robust financing in place with very attractive terms and mainly fixed interest rates."



+--------------------------------------------------------------------+ |Key Financial Figures| Quarter ended |Nine months ended|Year ended| |(In millions of | September 30, | September 30, | December | |dollars, except per | | | 31, | |share data) |-----------------+-----------------+----------| | | 2008 | 2007 | 2008 | 2007 | 2007 | |---------------------+--------+--------+--------+--------+----------| |Revenues |$ 534.3|$ 439.1|$1,455.9|$1,147.4| $1,519.9| |---------------------+--------+--------+--------+--------+----------| |EBIT | 187.8| 167.4| 569.4| 418.0| 494.5| |---------------------+--------+--------+--------+--------+----------| |Income before income | 157.7| 146.5| 522.2| 393.5| 458.7| |tax expense (benefit)| | | | | | |---------------------+--------+--------+--------+--------+----------| |Net income to equity | 124.4| 242.5| 378.4| 424.2| 470.0| |holders | | | | | | |---------------------+--------+--------+--------+--------+----------| |Basic earnings per | 0.71| 1.38| 2.15| 2.39| 2.65| |share ($ per share) | | | | | | |---------------------+--------+--------+--------+--------+----------| |Diluted earnings per | 0.69| 1.37| 2.11| 2.39| 2.65| |share ($ per share) | | | | | | |---------------------+--------+--------+--------+--------+----------| |Adjusted EBITDA (as | 276.1| 251.3| 726.5| 635.0| 800.8| |defined) | | | | | | |---------------------+--------+--------+--------+--------+----------| |Net cash provided by | 257.6| 215.1| 628.8| 517.7| 687.3| |operating activities | | | | | | |---------------------+--------+--------+--------+--------+----------| |Cash investment in | 86.4| 67.0| 235.7| 203.4| 288.7| |MultiClient library | | | | | | |---------------------+--------+--------+--------+--------+----------| |Capital expenditures | 122.9| 74.4| 341.2| 154.2| 270.0| |---------------------+--------+--------+--------+--------+----------| |Total assets (period | 3,066.9| 1,982.1| 3,066.9| 1,982.1| 2,875.0| |end) | | | | | | |---------------------+--------+--------+--------+--------+----------| |Cash and cash | | | | | | |equivalents (period | 87.8| 118.0| 87.8| 118.0| 145.3| |end) | | | | | | |---------------------+--------+--------+--------+--------+----------| |Net interest bearing |$1,177.6|$ 739.7|$1,177.6|$ 739.7| $1,172.7| |debt (period end) | | | | | | +--------------------------------------------------------------------+

Full Q3 2008 earnings release can be downloaded at www.newsweb.no or www.pgs.com

FOR DETAILS, CONTACT:

Tore Langballe, SVP Corporate Communications Phone: +47 67 51 43 75 Mobile: +47 90 77 78 41

Bård Stenberg, Investor Relations Manager Phone: +47 67 51 43 16 Mobile: +47 99 24 52 35

US Investor Services Phone: +1 281 509 8712

**** Petroleum Geo-Services is a focused geophysical company providing a broad range of seismic and reservoir services, including acquisition, processing, interpretation, and field evaluation. The company also possesses the world's most extensive multi-client data library. PGS operates on a worldwide basis with headquarters at Lysaker, Norway. For more information on Petroleum Geo-Services visit www.pgs.com.

**** The information included herein contains certain forward-looking statements that address activities, events or developments that the Company expects, projects, believes or anticipates will or may occur in the future. These statements are based on various assumptions made by the Company, which are beyond its control and are subject to certain additional risks and uncertainties. The Company is subject to a large number of risk factors including but not limited to the demand for seismic services, the demand for data from our multi-client data library, the attractiveness of our technology, unpredictable changes in governmental regulations affecting our markets and extreme weather conditions. For a further description of other relevant risk factors we refer to our Annual Report for 2007. As a result of these and other risk factors, actual events and our actual results may differ materially from those indicated in or implied by such forward-looking statements.

This announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.



LINK: http://hugin.info/115/R/1262955/277132.pdf



LINK: http://hugin.info/115/R/1262955/277133.pdf

Petroleum Geo-Services ASA

http://www.pgs.com

ISIN: NO0010199151

Stock Identifier: XOSL.PGS

US: PGSVY