Dawson Geophysical Reports Decline in Revenues and Assets, Net Loss in Q3 2024

Dawson Geophysical Company reported significant financial changes in its 10-Q filing for the quarter ending September 30, 2024. The company, a provider of onshore seismic data acquisition services in North America, experienced a notable decline in total current assets, which fell to $13.2 million from $37.4 million at the end of 2023. Total assets also decreased to $30.2 million from $57.5 million, while total stockholders’ equity dropped to $18.2 million from $31.4 million.

Operating revenues for the three months ended September 30, 2024, were $14.4 million, a decrease from $23.0 million in the same period of 2023. This decline was attributed to a 52% drop in U.S. fee revenues, which fell to $4.7 million from $9.7 million, primarily due to decreased crew utilization. For the nine months ended September 30, 2024, total revenues were $58.5 million, down from $72.6 million in 2023. Reimbursable revenues also saw a significant decrease, contributing to the overall revenue decline.

Despite the revenue drop, operating expenses for the three months ended September 30, 2024, decreased to $20.2 million from $28.9 million in the same period of 2023, reflecting a 30% reduction. This reduction was driven by lower acquisition expenses in both U.S. and Canadian operations. However, the company still reported a consolidated loss from operations of $(5.8 million) for the quarter, slightly higher than the $(5.7 million) loss reported in Q3 2023. The net loss for the three months ended September 30, 2024, was $(5.6 million), compared to $(5.2 million) in the prior year.

For the nine months ended September 30, 2024, the net loss was $(3.3 million), a significant improvement from $(10.0 million) in the same period of 2023. The company reported net cash provided by operating activities of $3.6 million for the nine months, up from $2.5 million in 2023.

Strategically, Dawson Geophysical completed an asset purchase from Breckenridge Geophysical in March 2023, acquiring assets related to seismic data acquisition services. This acquisition was structured as an asset purchase and has been accounted for as a transfer of net assets under common control. Shareholders approved the conversion of a convertible note related to this acquisition in September 2023, leading to the issuance of additional shares.

As of September 30, 2024, the company had $7.0 million in cash and a positive working capital balance of $4.4 million. The company continues to focus on operational efficiency and plans to invest in new equipment to enhance revenue and margins.