Viridien: 2024 Interim Financial Report

27, avenue Carnot 91300 Massy

France

CONDENSED INTERIM FINANCIAL REPORT

First semester 2024 Results

July 30, 2024

TABLE OF CONTENTS

STATEMENT BY THE PERSON RESPONSIBLE FOR THE HALF-YEAR FINANCIAL REPORT……..…………………...………..3

STATUTORY AUDITOR’S REPORT ON THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS ...............4

OPERATING AND FINANCIAL REVIEW .........................................................................................................................................5

    BUSINESS OUTLOOK                                                                                                                                                                                                5

     2024 Q2 OPERATING RESULTS                                                                                                                                                                                  5

     FORWARD-LOOKING STATEMENTS                                                                                                                                                                          11 

CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS.............................................................................. 13

     UNAUDITED INTERIM CONSOLIDATED STATEMENT OF OPERATIONS – YEAR-TO-DATE                                                                                           123

     UNAUDITED INTERIM CONSOLIDATED STATEMENT OF OPERATIONS – QUARTER-TO-DATE                                                                                      13

     UNAUDITED INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS) – YEAR-TO-DATE                                                             14

     UNAUDITED INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS) – QUARTER-TO-DATE                                                       14

     UNAUDITED INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION                                                                                                            15

     UNAUDITED INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS                                                                                                                       16

     UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY                                                                                                          18

     NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS                                                                                                       18

STATEMENT BY THE PERSON RESPONSIBLE FOR THE HALF-YEAR FINANCIAL REPORT

of the year.

_________________________________

Sophie ZURQUIYAH

Chief Executive Officer

STATUTORY AUDITOR’S REPORT ON THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

To the Shareholders,

In compliance with the assignment entrusted to us by your Annual General Meeting and in accordance with the requirements of Article L. 451-1-2 III of the French Monetary and Financial Code (Code monétaire et financier), we hereby report to you on:

•     the review of the accompanying condensed half-yearly consolidated financial statements of Viridien, for the period from January 1 to June 30, 2024,

•     the verification of the information presented in the half-yearly management report.

These condensed half-yearly consolidated financial statements are the responsibility of the Board of Directors. Our role is to express a conclusion on these financial statements based on our review.

1.       Conclusion on the Financial Statements

We conducted our review in accordance with professional standards applicable in France. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with professional standards applicable in France and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Based on our review, nothing has come to our attention that causes us to believe that the condensed half-yearly consolidated financial statements are not prepared, in all material respects, in accordance with IAS 34 – standard of the IFRSs as adopted by the European Union applicable to interim financial information.

2.       Specific Verification

We have also verified the information presented in the half-yearly management report on the condensed half-yearly consolidated financial statements subject to our review.

We have no matters to report as to its fair presentation and consistency with the condensed half-yearly consolidated financial statements.

Paris-La Défense, July 30, 2024

The Statutory Auditors

                                         FORVIS MAZARS                                                                         ERNST & YOUNG et Autres

       Daniel Escudeiro                              Alexandre de Belleville                                              Claire Cesari-Walch

The second quarter confirms the trends of the beginning of the year with a strong Data, Digital and Environment segment and

Geoscience and Earth Data businesses are driven from increases in offshore E&P Capex. Our clients need fresh data associated with best-in-class technology to de-risk opportunities. As a result, we captured strong order intake and a solid pipeline of multiclient

As expected, Sensing and Monitoring remained at lower level than last year without contributions from mega crew equipment sales. 

PARIS, France – July 30, 2024 – Viridien (ISIN: FR0013081864), a world leader in Geoscience, announced today its second

adaptation plan to mitigate the impact on financial results.

Following our recent S&P credit rating increase, we have negotiated an extension of our $100 million revolving credit facility to October 2026, a key element of our financial roadmap. 

Given our solid performance in the first half of the year, improved visibility and outlook for the second half, we reiterate our full year targets for Revenue, EBITDA and Net Cash Flow.”

Results of operation 

Financial information is presented under IFRS standards, some sections of this report contain non-IFRS financial measures as EBITDAs and Net Cash Flow which are fully described in the glossary of the 2023 annual consolidated financial statements.

Statement of income 

This operating and financial review and prospects should be read in conjunction with our consolidated interim financial statements and the notes thereto. 

Our accounting policies are fully described in note 1 to our

2023 consolidated annual financial statements

                                                                                                 Six Month ended June 30,                                              % change

                     (In millions of US$)                                     2024                                            2023                                    2024 vs. 2023

IFRS15 adjustment impact

For internal reporting purposes Viridien's management principles, with Earth Data prefunding revenues recorded continues to apply the pre-IFRS 15 revenue recognition based on percentage of completion methods.

Six Month ended June 30,

                   (In millions of US$)                                                 ^{2024                                                                     2023}

                                                                                                Six Month ended June 30,                                       % change

                           (In millions of US$)                                2024                                       2023                               2024 vs. 2023

Geoscience (GEO)

Geoscience operating revenues as reported were up 21% year-on-year to US$193 million in H1 2024 compared to US$159 million in 2023.

Our Geoscience global activity remains strong sustained by demand for high-end large projects, including OBN, and NOCs increasing activity (on the back of our advances in Full Waveform Imaging now applying to land environments).

SMO operating revenues were down 20% year-on-year to US$170 million, without mega crew equipment sales this year. 

Land equipment sales represented 44% of SMO revenue, compared to 33% in H1 2023, up 5% year-on-year. Land equipment sales of US$74 million in H1 2024 slightly up from US$70 million in 2023 driven by the cable system replacement market, with deliveries in Middle East and Asia in Q2, and by the geothermal industry in Europe.

Marine equipment sales represented 44% of SMO revenue, compared to 56% in H1 2023, down 36% year-on-year. Marine equipment sales of US$75 million in H1 2024 were down from US$118 million in 2023 continues to benefit from the uptake of the OBN technology and after the Q1 sales in Europe, we made further sales of our GPR-300 in Asia.

Other financial items

Net income from equity affiliates was close to zero.

Net financial income and expenses was a US$50 million expense, mostly associated with the cost of our financial debt. 

Income taxes amounted to an expense of US$6 million.

Net income from discontinued operations was US$16 million and includes the interest from ONGC litigation.

Liquidity and Capital Resources

Cash flow statement

Six Month ended June 30,

                                                                                                                                           2024                                             2023

US$5 million outflows in this semester from a US$68 million outflows in 2023.

Financial debt 

Liquidity 

Group Liquidity of US$430 million on June 30, 2024 includes US$340 million of cash and US$90 million of undrawn RCF. (For a discussion regarding RCF, refer to note 13 of our 2023 consolidated annual financial statements) Forward looking statements

 -

CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

Unaudited Interim Consolidated statement of operations – Year-To-Date

                                                                                                                                                                     Six months ended June 30,

(a) Earning per share is presented as nil being less than US$0.01 at June 30,2023.

See the notes to the Unaudited Interim Consolidated Financial Statements 

Unaudited Interim Consolidated statement of operations – Quarter-To-Date

                                                                                                                                                                  Three months ended June 30,

See the notes to the Unaudited Interim Consolidated Financial Statements 

Unaudited Interim Consolidated statement of comprehensive income (loss) – Year-To-Date

                                                                                                                                                                      Six months ended June 30,

(a) Including other comprehensive income related to the discontinued operations. 

Unaudited Interim Consolidated statement of comprehensive income (loss) – Quarter-To-Date

                                                                                                                                                                   Three months ended June 30,

(a) Including other comprehensive income related to the discontinued operations. 

Unaudited Interim Consolidated statement of financial position

See the notes to the Unaudited Interim Consolidated Financial Statements                                                                 

Unaudited Interim Consolidated statement of cash flows

                                                                                                                                                                      Six months ended June 30.

                                                                                                                                                                      Six months ended June 30.

See the notes to the Interim Consolidated Financial Statements                                                                

Unaudited Interim Consolidated statements of changes in equity

                                                                                                                                                   Income and                        Equity

                                           Number of                   Additional                                                           expense Cumulative attributable          Non-

                                                                Share                       Retained      Other       Treasury                                                                                  Total

                                             Shares                        paid-in                                                          recognized translation     to owners    controlling

                                                               capital                       earnings    reserves       shares                                                                                  equity

                                              issued                        capital                                                            directly in adjustment  of Viridien       interests

(a) Reverse Share Split : Pursuant to a delegation from the Combined General Meeting of shareholders of May 15, 2024, and a sub-delegation from the Board of Directors held on the same day, the Company's Chief Executive Officer has decided to implement a reverse share split on the basis of 1 new share of €1.00 nominal value for 100 old shares of €0.01 nominal value. This operation will be effective on July 31^st, 2024 and has no impact on the Accounts published as of June 30, 2024.

Notes to the Unaudited Interim Consolidated financial statements  

Viridien S.A. (“the Company”), along with its subsidiaries

(together, the “Group”) is a global geoscience technology leader. Employing around 3.500 people worldwide, Viridien provides a comprehensive range of data, products, services and solutions in the fields of earth sciences, data science, sensing and monitoring. The Group's unique portfolio helps its clients to more efficiently and responsibly solve complex digital, energy transition. natural resource, environmental and infrastructure challenges.

As the Company is listed in a European country, and pursuant to European regulation n°1606/2002 dated July 19, 2002, the accompanying interim condensed consolidated financial statements ending June 30, 2024 have been prepared in accordance with IAS 34 Interim Financial Reporting, as issued by the International Accounting Standards Board (IASB) and as adopted by the European Union and in force at June 30, 2024.

The Board of Directors has authorized these interim condensed consolidated financial statements for issue on July 30, 2024.

The interim condensed consolidated financial statements are presented in U.S. dollars and have been prepared on a historical cost basis. except for certain financial assets and liabilities that have been measured at fair value.

1.1 - Critical accounting policies

The interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group’s annual financial statements as of and for the year ended December 31, 2023 included in its Universal Registration Document for the year 2023 filed with the AMF on March 14, 2024 and approved by the General Meeting on May 15, 2024.

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group’s annual financial statements for the year ended December 31, 2023. 

In addition, the Group has adopted the following new Standards, Amendments, and Interpretations:

„  Amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures: Supplier Finance Arrangements.

„  Amendments to IFRS 16 Leases: Lease Liability in a Sale and Leaseback.

„  Amendments to IAS 1 Presentation of Financial Statements:

-       Classification of Liabilities as Current or NonCurrent

-       Classification of Liabilities as Current or Non-current

-       Deferral of Effective Date -                 Non-current Liabilities with Covenants.

The adoption of the new Standards, Amendments, and Interpretations had no significant impact on the Group’s interim financial statements.

At the date of issuance of these interim condensed consolidated financial statements, no early application has been made of any standards, amendments or interpretations not yet adopted by the European Union.

Pillar II

The OECD Pillar II regime has been implemented under French tax regulations as of 1/1/2024. As a consequence, Viridien SA and all controlled entities face new fiscal and compliance obligations which may, depending on the GloBE effective tax rate of each jurisdiction where the group operates, create additional tax expenses to bring such ETR to a minimum of 15%.

Although the law is fully enacted, a number of technical positions remain to be clarified by either the OECD or individual jurisdictions, through Administrative Guidance for the former and local legislation or administrative guidance for the latter.  It is expected that all such incremental guidance should be finalized before the end of financial year 2024 in order to allow Viridien SA and its affiliates to appropriately calculate and record potential Pillar II taxes as part of the annual income tax charge in the consolidated financial statements.

The Group has assessed any possible Pillar II tax expenses with the conclusion that these are not material for the period.  For deferred tax purpose, the Group has applied the compulsory temporary exclusion published by the IASB in May 2023.

1.2 - Use of judgment and estimates

The preparation of interim consolidated financial statements in accordance with IFRS requires management to make estimates, assumptions and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the interim consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates due to changes in economic conditions, changes in laws and regulations, changes in strategy and the inherent imprecision associated with the use of estimates.

Key judgments and estimates used in the financial statements are summarized in the following table:

Rounding

Some figures in this document, including financial data, have been rounded. As a result, the totals shown in this document       

may not be the exact sum of the preceding figures. 

Change of name

At the Annual General Meeting on May 15, 2024, shareholders approved the resolution to change the company’s corporate name from CGG to Viridien. To further support its growth strategy, the company launched the new Viridien brand on 10th June at the 2024 EAGE Annual Conference in Oslo, further strengthening its focus across a portfolio of solutions including the Core businesses of Geoscience, Earth Data and Sensing & Monitoring, as well as new offerings in both the Low Carbon markets of Minerals & Mining and CCS, and markets beyond energy in HighPerformance Computing (HPC) and Infrastructure Monitoring.

Research Tax Credit

On June 28, 2024 Viridien derecognized from balance sheet French research tax credit for the year 2023 amounting US$7.3 million (Gross) which were assigned to La Banque Postale Leasing & Factoring. The net cash (US$5.8 million) has been collected by Viridien on July 2, 2024, therefore the receivable has been classified as other receivables as of June 30, 2024.

ONGC Litigation

On March 18, 2013, CGG Services SAS, a fully owned subsidiary of Viridien, initiated arbitration proceedings against ONGC, an Indian company, to recover certain unpaid amounts under three Marine acquisition commercial contracts between 2008 and 2010.

On April 2, 2024, CGG Services SAS concluded with ONGC, three settlement agreements at a total amount of US$40.6 million.  

The Settlement Agreements now form part of the Bombay High Court Order dated April 4, 2024. The Court has allowed ONGC to withdraw the appeals in terms of the Settlement Agreements and also the amount deposited by ONGC in Court. However, the withdrawal of the deposit will only be allowed upon payment being made to Viridien in terms of the Settlement Agreements.

As of the date hereof, the agreed amount less applicable taxes and other related fees has been fully recovered. Viridien expects ONGC to apply for release of the deposit from the Court in due course. In the premise, this litigation is now concluded (see Note 3 – Discontinued Operations for impact details).

Net income (loss) from discontinued operations

                                                                                                                                                                  Six months ended June 30, 

Net cash flows incurred by discontinued operations are as follows

The following table presents the net cash flow from discontinued operations for each of the periods stated:

                                                                                                                                                                  Six months ended June 30,

In 2024 the net cash flow generated by discontinued

operations includes:                                                                                                     In 2023 the net cash flow generated by discontinued

operations includes US$(10.9) million cash outflows related

•       US$ $38.3 million related to the resolution of ONGC   to Idle Vessel Compensation. litigation.

•       US$(10.9) million cash out flows related to Idle  Vessel Compensation.

Short-term leases and leases of low-value assets

As allowed by IFRS 16, the Group decided to use exemptions for short-term leases (<12 months) and leases of low-value assets (<US$5.000) which were not material at June 30, 2024 and at December 31, 2023.

Revenues from subleases

The Group signed arrangements with third parties to sublease leased real estate assets. The income generated by these sublease agreements, which are classified as operating leases was not material at June 30, 2024 and at

December 31, 2023.

Variation over the period

(a)   Including US$21.9 million additional right-of use assets during the first semester 2024 compared to US$55.1 million in 2023.

(b)   Including US$(21.7) million depreciations of right-of-use assets during the first semester 2024 compared to US$(37.7) million in 2023.

Reconciliation of acquisitions with the consolidated statements of cash flows and capital expenditures 

                                                                                                                                                                  Six months ended June 30,

Gross financial debt as of June 30, 2024 was US$1,280.9 million compared to US$1,300.8 million as of December 31, 2023.

The breakdow of our gross debt is as follows :

Changes in liabilities arising from financing activities

(a)    Related to the 2023 asset financing to expand our HPC and Cloud solutions capabilities.

(b)    Mainly EUR/USD exchange rate fluctuation on 2027 Notes tranche EUR.

US$ 100 million Revolving Credit Facility

As of June 30, 2024 the available commitment of our US$100 million Super Senior Revolving Credit Facility (RCF) is still 90% and US$7m out of the US$10 million ancillary  facility  devoted to the issuance of bonds, guarantees and letter of credit remain available.

As our drawings do not exceed 40% we are not required to perform any test on our covenants.

We have recently negotiated an extension of our RCF to October 2026.

Other loans

Viridien opened a new HPC (High-Performance Computing) center in the southeast of England in November 2023. 

The Group entered into an asset financing agreement with CSI in relation with the infrastructure and specific (noncompute) assets of the Data Center, and resulting in a $29.9m 3-year installment loan which will be fully repaid by October, 1st 2026. Monthly payments of US$0.4 million will be paid until July 2026, then 3 monthly payments of US$9.4 million in August, September and October 2026.

As of June 30th, 2024 the remaining liability was of $29.3m, compared to $29.7m at December 31st, 2023.

The financing agreement is treated as a financial debt and does not have the character of an operating debt. Cash flows are presented in the financing flows in the consolidated cash flow statement.

On June 19, 2024, the Board of Directors allocated:

„  1,000,000 performance shares to the Chief Executive Officer. The performance shares vest in one batch in June 2027 and are subject to presence condition to the Chief Executive Officer and subject to performance conditions related to the Viridien share price, internal performances conditions of EBITDA, BTC Revenues and ESG metrics.

„  3,050,000 performance shares to the Executive Leadership Members. The performance shares vest in one batch in June 2027 and are subject to presence condition to the Executive Leadership Members and subject to performance conditions related to the Viridien share price, internal performances conditions of Ebitda, BTC Revenues and ESG metrics.

„  968,400 performance shares to other employees. The performance shares vest in two batches. in June 2026 (for 50% of the shares allocated) and June 2027 (for 50% of the shares allocated) and are subject to presence condition to other employees and subject to performance conditions related to the Viridien share price, internal performances conditions of EBITDA, BTC Revenues and ESG metrics.

„  1,770,400 restricted shares subject to presence condition to other employees. The restricted shares subject to presence conditions vest in two batches, in June 2026 (for 50% of the shares allocated) and June 2027 (for 50% of the shares allocated). 

„  2,785,000 Long Term Cash to other employees. The Long Term Cash vest in two batches. in June 2026 (for 50% of the units allocated) and June 2027 (for 50% of the units allocated). 

Such vestings are subject to presence condition to other employees and subject to performance conditions related to the Viridien share price, internal performances conditions of Ebitda, BTC Revenues and ESG metrics.

The main assumptions related to the June 19, 2024 stock options, performance share and restricted share plans are as follows:

„  Viridien share price as of June 19, 2024: €0.49

„  Volatility over 2 years: 47.08%

„  Volatility over 3 years: 50.54%

„  Risk-free rate: 3.08% (over 2 years) and 3.00% (over 3 years).

The aforementioned performance shares and restricted shares allocation plans have been valued at €2.7 million. 

The aforementioned Long Term Cash have been valued at $2.2 million. The fair value of the rights regarding this cashsettled share-based payment plan will be re-measured at each reporting date until the liability is settled.

Due to the allocation date, the cost recognized over the period is not significant.

Contractual obligations 

The following table sets forth our future cash obligations (not discounted) on our contractual obligations and commitments as of June 30, 2024:

Payments due by period

(a) Payments in other currencies are converted into US dollars at June 30, 2024 exchange rates. (b) These amounts are principal amounts and do not include any accrued interests.

Segment presentation and discontinued operations

The financial information by segment is reported in accordance with our internal reporting system and provides internal segment information that is used by the chief operating decision maker to manage and measure performance.

The 2021 strategic roadmap announced in November 2018 aimed at implementing an asset light business model by reducing Viridien’s exposure to the contractual data acquisition business. As a result of the strategic announcements and actions undertaken subsequently, we presented our contractual data acquisition operations and the costs of implementation of the related measures, referred to as the Viridien 2021 Plan, in accordance with IFRS 5, as discontinued operations and assets held for sale.

Data. Digital & Energy Transition (DDE)

This operating segment comprises the Geoscience business lines (processing and imaging of geophysical data, reservoir characterization, geophysical consulting and geoscience software sales and services) and the Earth Data (ex multiclient) business line (development and management of a seismic and geological data library that we undertake and license to a number of clients on a non-exclusive basis). Both activities regularly combine their offerings, generating overall synergies between their respective activities. 

Beyond the core, Viridien is leveraging on its technologies and expertise to address the fast-growing markets of Digital Sciences and Energy Transition. 

In Digital Sciences, we focused on our long-standing leadership in digital technology, especially as applied to geoscience, to develop an integrated expert solution including the hardware platform, middleware and software services that are required to cost effectively support advanced cloud-based High-Performance Computing (HPC) workflows and data transformation services. In this platform, we notably propose data, algorithm and software as a service (DaaS/SaaS) on our Viridien cloud.

 In the Energy Transition, we propose services and technologies dedicated to Carbon Capture Utilization and Storage (CCUS), Geothermal, Environmental Sciences and Minerals and Mining, CCUS, which represents a substantial submarket, is one of the key enablers to reduce carbon footprint. Many energy companies are planning significant CCUS projects and increasingly incorporate this technology in their development. Low carbon energy, such as hydrogen, will also require long term storage and monitoring. To be successful, these new businesses require a detailed understanding of the subsurface domain where Viridien excels, through its advanced geoscience and digital science technologies and its global earth data library.

Sensing & Monitoring (SMO)

This operating segment comprises manufacturing and sales activities for land, marine and OBN geophysical equipment used for data seismic acquisition. Additionally, its unique portfolio of industry leading sensor technology allows to bring the benefits of its advanced sensor technology to the fastgrowing Monitoring and Observation market, from structural health monitoring (SHM) to monitoring solutions for energy transition (CCUS notably) and environment. The SMO segment carries out its activities through our subsidiary Sercel.

Internal reporting and segment presentation 

Before the implementation of IFRS 15, the Group applied the percentage of completion method for recognizing Earth Data prefunding revenues. Following the implementation of IFRS 15, the Group recognizes Earth Data prefunding revenues upon delivery of processed data (when performance obligation is fullfilled).

Although IFRS fairly presents the Group’s statement of financial position, for internal reporting purposes Viridien's management continues to apply the pre-IFRS 15 revenue recognition principles, with Earth Data prefunding revenues recorded based on percentage of completion. Viridien's management believes this method aligns revenues closely with the activities and resources used to generate it and provides useful information as to the progress made on Earth Data surveys, while also allowing for useful comparison across time periods. 

Viridien therefore presents the Group’s results of operations in two ways: 

„  the “Reported” or “IFRS” figures, prepared in accordance with IFRS, with Earth Data prefunding revenues recognized upon delivery of the data (when performance obligation is fullfilled); and 

„  the “Segment” figures, for purposes of internal management reporting, prepared in accordance with the Group’s previous method for recognizing Earth Data prefunding revenues. 

Other companies may present segment and related measures differently than we do. Segment figures are not a measure of financial performance under IFRS and should not be considered as indicators of our operating performance or an alternative to other measures of performance in accordance with IFRS.

Alternative performance measures 

As a complement to Operating Income, EBIT may be used by management as a performance measure for segments because it captures the contribution to our results of the significant businesses that are managed through our joint ventures. We define EBIT as Operating Income plus our share of income in companies accounted for under the equity method. 

We define EBITDAs as earnings before interest, tax, income from equity affiliates, depreciation, amortization net of amortization expense capitalized to Earth Data, and cost of share-based compensation. Share-based compensation includes both stock options and shares issued under our share allocation plans. EBITDAs is presented as additional information because we understand that it is a measure used by certain investors to determine our operating cash flow and historical ability to meet debt service and capital expenditure requirements. 

Inter-segment transactions are made at arm’s length prices. These inter-segment revenues and the related earnings are eliminated in consolidation in the tables that follow under the column “Eliminations and other”.

Operating Income, EBITDAs and EBIT may include nonrecurring or restructuring items. General corporate expenses, which include Group management, financing, and legal activities, have been included in the column “Eliminations and other” in the tables that follow. The Group does not disclose financial expenses or financial revenues by segment because they are managed at the Group level. 

Identifiable assets are those used in the operations of each segment. The group does not track its assets based on country of origin. 

Capital employed is defined as "total assets" excluding “Cash and cash equivalents” less (i) “Current liabilities” excluding “Bank overdrafts” and “Current portion of financial debt” and (ii) noncurrent liabilities excluding “Financial debt”. 

Analysis by segment (continuing operations)

                                                                                                                           Six Month ended June 30, 2024

(a)    Eliminations and other” corresponded mainly to general corporate expenses

(b)    Capital expenditures included capitalized development costs of US$(7.9) million for the six months ended June 30, 2024. “Eliminations and other” corresponded to the variance of suppliers of assets for the six months ended June 30, 2024.

(c)    Capital employed and identifiable assets related to discontinued operations are included under the column “Eliminations and other”.

                                                                                                                             Six Month ended June 30, 2023

(a)    Eliminations and other” corresponded mainly to general corporate expenses and elimination of the margin arising from the sale of Sercel equipment to Argas for the share held by Viridien.

(b)    Capital expenditures included capitalized development costs of US$(9.1) million for the six months ended June 30, 2023. “Eliminations and other” corresponded to the variance of suppliers of assets for the six months ended June 30, 2023.

(c)    Capital employed and identifiable assets related to discontinued operations and our stake in Argas joint venture are included under the

column “Eliminations and other”.

The following table presents the transactions with our joint ventures and associates.

                                                                              Six months ended June 30, 2024                        Six months ended June 30, 2023

                                                                                                June 30, 2024                                                       December 31, 2023

No credit facility or loan was granted to the Company by shareholders during the last two years.

                                                                                                                                                                                    June 30

(a) Other revenues (expenses) – net excluding income (loss) on discontinued operations .

The other revenue (expenses) for the first semester of 2024 amounted to US$(3.6) million mainly including:

„  US$(3.9) million of net restructuring costs in SMO; and

„  US$(0.7) million of net restructuring costs in Data Digital Energy Transition (DDE); and

„  US$ 0.8 million income from insurance refund (SMO)  „     US$ 0.4  million gain on hedging contracts.

The other revenue (expenses) for the first semester of 2023 amounted to US$(2.2) million mainly including:

„  US$(0.9) million loss on hedging instruments; and

„  US$(0.8) million provision on stock related to a fire brokeout in SMO subcontractor warehouse; and

„  US$(0.4) million of restructuring costs corresponding mainly to Data Digital Energy Transition (DDE)

As of June 30, 2024 the Other Financial Income (Loss) was a US$0.8 million loss, including:

„  US$(1.2) million commission on the tax research credit assignment.

As of June 30, 2023 the Other Financial Income (Loss) was a US$3.3 million gain, including:

„  US$2.7 million foreign exchange gain driven by the Euro and the Brazilian real that have strengthened during the first semester 2023 against the US dollar hence triggering a positive impact of US$1.4 million. 

SMO Restructuring

During the month of July 2024, trade union organizations and SMO staff in France were informed by Management of the intention to open negotiations and an information consultation on a reorganization and headcount reduction project at the beginning of September 2024, through a voluntary departure mechanism. This decision has no consequences on the accounts closed on June 30, 2024 and the analyzes necessary to evaluate future impacts are currently on-going.

Revolving Credit Facility

Viridien has signed an agreement to extend the maturity of its revolving credit facility to October 2026 (from October 2025).