Condensed Consolidating Financial Information

6 Months Ended

Jun. 30, 2017

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Condensed Consolidating Financial Information

Condensed Consolidating Financial Information

The Notes were issued by ION Geophysical Corporation and are guaranteed by the Guarantors, all of which are 100-percent-owned subsidiaries. The Guarantors have fully and unconditionally guaranteed the payment obligations of ION Geophysical Corporation with respect to the Notes. The following condensed consolidating financial information presents the results of operations, financial position and cash flows for:

• ION Geophysical Corporation and the Guarantors (in each case, reflecting investments in subsidiaries utilizing the equity method of accounting).

• All other subsidiaries of ION Geophysical Corporation that are not Guarantors.

• The consolidating adjustments necessary to present ION Geophysical Corporation’s results on a consolidated basis.

This condensed consolidating financial information should be read in conjunction with the accompanying consolidated financial statements and footnotes. For additional information pertaining to the Notes, See Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II of this Form 10-Q.

	June 30, 2017
Balance Sheet	ION Geophysical Corporation			The Guarantors			All Other Subsidiaries			Consolidating Adjustments			Total Consolidated
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	18,258		$	—		$	25,014		$	—		$	43,272
Accounts receivable, net	—			8,640			10,352			—			18,992
Unbilled receivables	—			1,565			17,318			—			18,883
Inventories	—			8,558			6,065			—			14,623
Prepaid expenses and other current assets	2,378			892			2,596			—			5,866
Total current assets	20,636			19,655			61,345			—			101,636
Property, plant, equipment and seismic rental equipment, net	1,259			9,641			47,999			—			58,899
Multi-client data library, net	—			69,746			27,098			—			96,844
Investment in subsidiaries	662,848			271,486			—			(934,334		)	—
Goodwill	—			—			23,354			—			23,354
Intangible assets, net	—			2,337			49			—			2,386
Intercompany receivables	—			—			35,433			(35,433		)	—
Other assets	1,332			145			256			—			1,733
Total assets	$	686,075		$	373,010		$	195,534		$	(969,767	)	$	284,852
LIABILITIES AND EQUITY
Current liabilities:
Current maturities of long-term debt	$	38,619		$	1,364		$	—		$	—		$	39,983
Accounts payable	2,829			19,026			2,623			—			24,478
Accrued expenses	10,839			9,919			9,508			—			30,266
Accrued multi-client data library royalties	—			22,573			78			—			22,651
Deferred revenue	—			2,684			6,592			—			9,276
Total current liabilities	52,287			55,566			18,801			—			126,654
Long-term debt, net of current maturities	116,206			—			—			—			116,206
Intercompany payables	493,667			15,252			—			(508,919		)	—
Other long-term liabilities	1,716			6,238			10,623			—			18,577
Total liabilities	663,876			77,056			29,424			(508,919		)	261,437
Equity:
Common stock	119			290,460			49,394			(339,854		)	119
Additional paid-in capital	900,574			180,699			202,290			(382,989		)	900,574
Accumulated earnings (deficit)	(858,462		)	215,372			12,438			(227,810		)	(858,462		)
Accumulated other comprehensive income (loss)	(20,032		)	4,372			(20,691		)	16,319			(20,032		)
Due from ION Geophysical Corporation	—			(394,949		)	(78,537		)	473,486			—
Total stockholders’ equity	22,199			295,954			164,894			(460,848		)	22,199
Noncontrolling interests	—			—			1,216			—			1,216
Total equity	22,199			295,954			166,110			(460,848		)	23,415
Total liabilities and equity	$	686,075		$	373,010		$	195,534		$	(969,767	)	$	284,852

	December 31, 2016
Balance Sheet	ION Geophysical Corporation			The Guarantors			All Other Subsidiaries			Consolidating Adjustments			Total Consolidated
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	23,042		$	—		$	29,610		$	—		$	52,652
Accounts receivable, net	—			12,775			7,995			—			20,770
Unbilled receivables	—			5,275			8,140			—			13,415
Inventories	—			8,610			6,631			—			15,241
Prepaid expenses and other current assets	3,387			4,624			1,548			—			9,559
Total current assets	26,429			31,284			53,924			—			111,637
Property, plant, equipment and seismic rental equipment, net	1,745			12,369			53,374			—			67,488
Multi-client data library, net	—			97,369			8,566			—			105,935
Investment in subsidiaries	660,880			257,732			—			(918,612		)	—
Goodwill	—			—			22,208			—			22,208
Intangible assets, net	—			3,008			95			—			3,103
Intercompany receivables	—			—			32,174			(32,174		)	—
Other assets	2,469			145			231			—			2,845
Total assets	$	691,523		$	401,907		$	170,572		$	(950,786	)	$	313,216
LIABILITIES AND EQUITY
Current liabilities:
Current maturities of long-term debt	$	11,281		$	3,166		$	134		$	—		$	14,581
Accounts payable	2,101			19,720			5,068			—			26,889
Accrued expenses	8,579			10,016			7,645			—			26,240
Accrued multi-client data library royalties	—			23,663			—			—			23,663
Deferred revenue	—			2,667			1,042			—			3,709
Total current liabilities	21,961			59,232			13,889			—			95,082
Long-term debt, net of current maturities	143,930			279			—			—			144,209
Intercompany payables	472,276			10,155			—			(482,431		)	—
Other long-term liabilities	467			12,117			7,943			—			20,527
Total liabilities	638,634			81,783			21,832			(482,431		)	259,818
Equity:
Common stock	118			290,460			19,138			(309,598		)	118
Additional paid-in capital	899,198			180,700			232,590			(413,290		)	899,198
Accumulated earnings (deficit)	(824,679		)	216,730			(3,639		)	(213,091		)	(824,679		)
Accumulated other comprehensive income (loss)	(21,748		)	4,420			(21,787		)	17,367			(21,748		)
Due from ION Geophysical Corporation	—			(372,186		)	(78,071		)	450,257			—
Total stockholders’ equity	52,889			320,124			148,231			(468,355		)	52,889
Noncontrolling interests	—			—			509			—			509
Total equity	52,889			320,124			148,740			(468,355		)	53,398
Total liabilities and equity	$	691,523		$	401,907		$	170,572		$	(950,786	)	$	313,216

	Three Months Ended June 30, 2017
Income Statement	ION Geophysical Corporation			The Guarantors			All Other Subsidiaries			Consolidating Adjustments			Total Consolidated
	(In thousands)
Net revenues	$	—		$	14,945		$	31,056		$	—		$	46,001
Cost of sales	—			18,369			12,014			—			30,383
Gross profit (loss)	—			(3,424		)	19,042			—			15,618
Total operating expenses	8,072			6,712			4,406			—			19,190
Income (loss) from operations	(8,072		)	(10,136		)	14,636			—			(3,572		)
Interest expense, net	(4,183		)	(69		)	11			—			(4,241		)
Intercompany interest, net	265			(1,643		)	1,378			—			—
Equity in earnings of investments	1,910			9,077			—			(10,987		)	—
Other income (expense)	(328		)	(1		)	521			—			192
Net income (loss) before income taxes	(10,408		)	(2,772		)	16,546			(10,987		)	(7,621		)
Income tax expense (benefit)	33			(5,171		)	7,540			—			2,402
Net income (loss)	(10,441		)	2,399			9,006			(10,987		)	(10,023		)
Net income attributable to noncontrolling interests	—			—			(418		)	—			(418		)
Net income (loss) attributable to ION	$	(10,441	)	$	2,399		$	8,588		(10,987		)	$	(10,441	)
Comprehensive net loss	$	(9,242	)	$	2,399		$	9,852		$	(11,833	)	$	(8,824	)
Comprehensive income attributable to noncontrolling interest	—			—			(418		)	—			(418		)
Comprehensive net income (loss) attributable to ION	$	(9,242	)	$	2,399		$	9,434		$	(11,833	)	$	(9,242	)

	Three Months Ended June 30, 2016
Income Statement	ION Geophysical Corporation			The Guarantors			All Other Subsidiaries			Consolidating Adjustments			Total Consolidated
	(In thousands)
Net revenues	$	—		$	17,590		$	18,564		$	(2	)	$	36,152
Cost of sales	—			22,910			8,391			(2		)	31,299
Gross profit (loss)	—			(5,320		)	10,173			—			4,853
Total operating expenses	9,791			6,685			4,965			—			21,441
Income (loss) from operations	(9,791		)	(12,005		)	5,208			—			(16,588		)
Interest expense, net	(4,641		)	(77		)	16			—			(4,702		)
Intercompany interest, net	219			(1,095		)	876			—			—
Equity in earnings (losses) of investments	(8,976		)	5,932			—			3,044			—
Other income (expense)	(2,112		)	182			213			—			(1,717		)
Net income (loss) before income taxes	(25,301		)	(7,063		)	6,313			3,044			(23,007		)
Income tax expense	41			496			1,719			—			2,256
Net income (loss)	(25,342		)	(7,559		)	4,594			3,044			(25,263		)
Net income attributable to noncontrolling interests	—			—			(79		)	—			(79		)
Net income (loss) attributable to ION	$	(25,342	)	$	(7,559	)	$	4,515		3,044			$	(25,342	)
Comprehensive net income (loss)	$	(28,057	)	$	(7,559	)	$	1,800		$	5,816		$	(28,000	)
Comprehensive income attributable to noncontrolling interest	—			—			(79		)	—			(79		)
Comprehensive net income (loss) attributable to ION	$	(28,057	)	$	(7,559	)	$	1,721		$	5,816		$	(28,079	)

	Six Months Ended June 30, 2017
Income Statement	ION Geophysical Corporation			The Guarantors			All Other Subsidiaries			Consolidating Adjustments			Total Consolidated
	(In thousands)
Net revenues	$	—		$	27,979		$	50,578		$	—		$	78,557
Cost of sales	—			35,956			20,882			—			56,838
Gross profit (loss)	—			(7,977		)	29,696			—			21,719
Total operating expenses	17,412			12,871			8,920			—			39,203
Income (loss) from operations	(17,412		)	(20,848		)	20,776			—			(17,484		)
Interest expense, net	(8,643		)	(96		)	34			—			(8,705		)
Intercompany interest, net	593			(3,140		)	2,547			—			—
Equity in earnings of investments	(3,134		)	17,853			—			(14,719		)	—
Other income (expense)	(5,087		)	(340		)	551			—			(4,876		)
Net income (loss) before income taxes	(33,683		)	(6,571		)	23,908			(14,719		)	(31,065		)
Income tax expense (benefit)	100			(5,213		)	7,097			—			1,984
Net income (loss)	(33,783		)	(1,358		)	16,811			(14,719		)	(33,049		)
Net income attributable to noncontrolling interests	—			—			(734		)	—			(734		)
Net income (loss) attributable to ION	$	(33,783	)	$	(1,358	)	16,077			$	(14,719	)	(33,783		)
Comprehensive net income (loss)	$	(32,067	)	$	(1,406	)	$	17,906		$	(15,766	)	$	(31,333	)
Comprehensive income attributable to noncontrolling interest	—			—			(734		)	—			(734		)
Comprehensive net income (loss) attributable to ION	$	(32,067	)	$	(1,406	)	$	17,172		$	(15,766	)	$	(32,067	)

	Six Months Ended June 30, 2016
Income Statement	ION Geophysical Corporation			The Guarantors			All Other Subsidiaries			Consolidating Adjustments		Total Consolidated
	(In thousands)
Net revenues	$	—		$	28,752		$	30,065		$	—	$	58,817
Cost of sales	—			44,337			18,557			—		62,894
Gross profit (loss)	—			(15,585		)	11,508			—		(4,077		)
Total operating expenses	17,202			14,501			10,937			—		42,640
Income (loss) from operations	(17,202		)	(30,086		)	571			—		(46,717		)
Interest expense, net	(9,334		)	(147		)	45			—		(9,436		)
Intercompany interest, net	451			(2,112		)	1,661			—		—
Equity in earnings (losses) of investments	(32,111		)	4,124			—			27,987		—
Other income (expense)	(2,086		)	(177		)	666			—		(1,597		)
Net income (loss) before income taxes	(60,282		)	(28,398		)	2,943			27,987		(57,750		)
Income tax expense	74			749			1,726			—		2,549
Net income (loss)	(60,356		)	(29,147		)	1,217			27,987		(60,299		)
Net income attributable to noncontrolling interests	—			—			(57		)	—		(57		)
Net income (loss) applicable to ION	$	(60,356	)	(29,147		)	$	1,160		$	27,987	$	(60,356	)
Comprehensive net loss	$	(64,555	)	$	(29,147	)	$	(3,039	)	$	32,243	$	(64,498	)
Comprehensive income attributable to noncontrolling interest	—			—			(57		)	—		(57		)
Comprehensive net loss attributable to ION	$	(64,555	)	$	(29,147	)	$	(3,096	)	$	32,243	$	(64,555	)

	Six Months Ended June 30, 2017
Statement of Cash Flows	ION Geophysical Corporation			The Guarantors			All Other Subsidiaries			Total Consolidated
	(In thousands)
Cash flows from operating activities:
Net cash provided by (used in) operating activities	$	(1,731	)	$	7,416		$	(2,046	)	$	3,639
Cash flows from investing activities:
Cash invested in multi-client data library	—			(3,962		)	(4,520		)	(8,482		)
Purchase of property, plant, equipment and seismic rental equipment	(165		)	(669		)	(81		)	(915		)
Net cash used in investing activities	(165		)	(4,631		)	(4,601		)	(9,397		)
Cash flows from financing activities:
Payments on notes payable and long-term debt	(1,018		)	(2,081		)	(58		)	(3,157		)
Intercompany lending	(1,574		)	(704		)	2,278			—
Costs associated with issuance of equity	(123		)	—			—			(123		)
Other financing activities	(173		)	—			—			(173		)
Net cash provided by (used in) financing activities	(2,888		)	(2,785		)	2,220			(3,453		)
Effect of change in foreign currency exchange rates on cash and cash equivalents	—			—			(169		)	(169		)
Net decrease in cash and cash equivalents	(4,784		)	—			(4,596		)	(9,380		)
Cash and cash equivalents at beginning of period	23,042			—			29,610			52,652
Cash and cash equivalents at end of period	$	18,258		$	—		$	25,014		$	43,272

	Six Months Ended June 30, 2016
Statement of Cash Flows	ION Geophysical Corporation			The Guarantors			All Other Subsidiaries			Total Consolidated
	(In thousands)
Cash flows from operating activities:
Net cash provided by (used in) operating activities	$	11,112		$	7,580		$	(31,031	)	$	(12,339	)
Cash flows from investing activities:
Investment in multi-client data library	—			(8,648		)	—			(8,648		)
Purchase of property, plant, equipment and seismic rental equipment	—			(340		)	—			(340		)
Net cash used in investing activities	—			(8,988		)	—			(8,988		)
Cash flows from financing activities:
Payments under revolving line of credit	—			—			—			—
Borrowings under revolving line of credit	15,000			—			—			15,000
Repurchase of common stock	(964		)	—			—			(964		)
Payments on notes payable and long-term debt	(433		)	(3,986		)	(367		)	(4,786		)
Cost associated with issuance of notes	(6,174		)	—			—			(6,174		)
Intercompany lending	(11,305		)	5,394			5,911			—
Payment to repurchase bonds	(15,000		)	—			—			(15,000		)
Other financing activities	13			—			—			13
Net cash provided by (used in) financing activities	(18,863		)	1,408			5,544			(11,911		)
Effect of change in foreign currency exchange rates on cash and cash equivalents	—			—			738			738
Net decrease in cash and cash equivalents	(7,751		)	—			(24,749		)	(32,500		)
Cash and cash equivalents at beginning of period	33,734			—			51,199			84,933
Cash and cash equivalents at end of period	$	25,983		$	—		$	26,450		$	52,433