OYOG

OYO Geospace (OYOG) today announced net income of $3.2 million, or $0.53 per diluted share, on revenues of $36.4 million for its quarter ended March 31, 2008. This compares with a net income of $3.1 million, or $0.52 per diluted share, on revenues of $32.1 million in the comparable quarter last year. The company noted that the results for the six months ended March 31, 2007 benefited from the recognition of the sale of a $16.2 million seabed reservoir monitoring system to BP for installation in the Caspian Sea.

• “Our seismic exploration business continued its strong performance in the second quarter. The immediate visibility of this market remains very healthy and backlog for our traditional seismic exploration products remains strong. As mentioned in our last press release, the company booked its first order for its new GSR wireless data acquisition system. Our customer, Houston Geophysical Services, is expected to field this 1,000 channel system later this month. We are currently in active discussions with a number of parties with respect to possible sales of our GSR wireless system and we are encouraged by customer interest in this product,” said Gary D. Owens, OYO Geospace’s Chairman, President & CEO.
• “During the quarter ended March 31, 2008, the company added two new customers for its borehole seismic system product line. Apex HiPoint, a company specializing in borehole seismic data acquisition and processing services, fielded its first borehole seismic acquisition service crew for the growing North American market. In addition, Mitcham Industries, a leading supplier of rental seismic equipment purchased its first borehole system to serve its global seismic customer base. We are pleased that both companies selected our borehole seismic technology for their respective services. Sales of borehole seismic products to these two new customers combined with sales to our installed base resulted in $4.0 million of seismic reservoir product revenue for the quarter,” continued Owens.
• “During the quarter, the company suffered two very large and expensive failures during the final stages of cable production. We lost both cables forcing us to manufacture each cable again; however, we were successful in the re-manufacturing effort and eventually delivered both cables. In each case, we learned new processes that will help us manufacture these cables more efficiently in the future; nevertheless, the learning experience was expensive. These unexpected losses lowered our overall gross profit by approximately $1.2 million,” Owens said.

OYOG rose 12.42% on the news. I recently doubled my position in OYOG, and plan to sell my higher bought shares sometime in the future.