FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

For the month of July 2010

CGG-Veritas

Tour Maine Montparnasse — 33 Avenue du Maine – BP 191 — 75755 PARIS CEDEX 15 (address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F þ     Form 40-F o

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes o     No þ

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82                     

 

 

CGGVeritas Announces Second Quarter 2010 Results

Group Operating Margin at 6%
Lower Multi-Client After-Sales in the Gulf-of-Mexico
Sercel Strengthening, Operating Margin to 27%

PARIS, France – July 30^th 2010 – CGGVeritas (ISIN: 0000120164 – NYSE: CGV) announced today its non-audited second quarter 2010 consolidated results. All comparisons are made on a year-on-year basis unless stated otherwise. All 2009 results are reported before restructuring and impairment.

	•		Group revenue was $647m, down 17% year-on-year with the vessel reduction plan realized Sequentially, Group revenue was down 7% as a result of Arctic land crew demobilization and reduced multi-client sales in the Gulf-of-Mexico and Brazil
	•		Group operating margin was 6%, with Sercel performance increasing to 27% and Services maintaining a slightly positive margin while operating in a low priced marine market and with low multi-client contributions
	•		Net income was $8m
	•		Net debt to equity ratio at 39%
	•		Backlog as of July 1st was stable sequentially at $1.5 billion

Second Quarter 2010 key figures

		First Quarter				Second Quarter
In million $		2010				2010				2009
Group Revenue			696				647				779
Sercel			222				247				239
Services			511				460				558
Group Operating Income			37				37				67
margin			5	%			6	%			9	%
Sercel			50				66				57
margin			22	%			27	%			24	%
Services			14				5				36
margin			3	%			1	%			6	%
Net Income			1				8				23
margin			0	%			1	%			3	%
Net Debt			1,343				1,452				1,499
Net Debt to Equity ratio			35	%			39	%			36	%

CGGVeritas CEO, Jean-Georges Malcor commented:

“Our 2010 second quarter results were in-line with our expectations despite the situation in the Gulf-of-Mexico and delays in the publication of pre-salt regulations in Brazil which impacted our marine multi-client sales. Sercel further strengthened this quarter, especially in marine, as streamer demand for both new builds and upgrades of existing configurations increased.

Looking forward, land and marine sales in Sercel are expected to remain at high levels driven by increased technology intensity requirements for high resolution imaging. In Services, commercial activity is increasingly supported by new opportunities in most regions. However, uncertainty in the Gulf-of-Mexico could continue to impact multi-client sales and probably will delay the balancing of supply and demand in contract marine if vessels relocate to other basins worldwide.

With our new organization we will focus on improving the operational performance of each of our activities, accelerating the continuous advance of technology and utilizing our full breadth to develop innovative solutions for our clients. BroadSeis, our new patented broadband marine solution launched last month saw excellent market take-up with multiple client tests already requested worldwide.”

Second Quarter 2010 Financial Results

Group Revenue

Group Revenue was down 17% in $ and 13% in € year-on-year mainly due to fleet capacity adjustments. Group Revenue was down 7% sequentially in $.

		First Quarter				Second Quarter								Second Quarter
In millions		2010 ($)				2010 ($)				2009 ($)				2010 (€)				2009 (€)
Group Revenue			696				647				779				498				573
Sercel Revenue			222				247				239				191				175
Services Revenue			511				460				558				353				409
Eliminations			-37				-60				-17				-46				-12
Marine contract			203				195				261				150				191
Land contract			114				79				83				62				61
Processing			94				94				97				72				72
Multi-client			100				92				116				70				86
MC marine			74				60				103				46				76
MC land			26				32				13				24				10

Sercel

Year-on-year, revenue was up 3% in $ and 9% in €. Sequentially, revenue was up 11% in $ and operating margin increased 5 points to 27% confirming the early recovery of the equipment market and the technology leadership of Sercel.

Sentinel^® solid steamer demand for new builds and vessel upgrades, along with increased technology take-up of SeaRay^® OBC systems, drove marine sales higher this quarter. In Land, sales remained strong on demand for increasing channel counts and regional activity.

During the quarter, deployment began on our industry first fiber-optic permanent monitoring solution with Optowave^TM in the North Sea, and the first sales of our Metrolog downhole pressure and temperature gauges in China were delivered.

Internal sales represented 24% of revenue.

Services

Year-on-year, revenue was down 18% in $ and 14% in €. Sequentially revenue was down 10% in $ and operating margin was 1%.

	•		Marine contract revenue was down 25% year-on-year in $ and 22% in € mainly due to the planned decommissioning of nine of our lower-end vessels which is now complete. Sequentially, revenue was down 4% with good vessel availability1 and production2 rates, both at 92% in a continued low priced market. 73% of the 3D fleet operated on contract, 27% on multi-client.
			We are on schedule with the upgrade of six of our high-end vessels to Nautilus® this year and have initiated the deployment of SeaPro Nav, our integrated navigation and positioning systems for all in water equipment.
			The Oceanic Vega was delivered in July and is currently starting its first contract in the North Sea. With a maximum towing capacity of 20 Sercel solid Sentinel streamers and Nautilus streamer steering devices, the Oceanic Vega will be unrivaled in providing high-end marine services including wide-azimuth and BroadSeisTM acquisition.
	•		Land contract revenue was down 4% year-on-year in $ and up 2% in €. Sequentially revenue was down 30% in $ as our Arctic crews demobilized. Activity remained high in the Middle East further reinforced by the mobilization of new OBC crews.
			The application of our high productivity, high resolution HPVA and V1 solutions continue to expand across our vibroseis land operations and our new land based broadband solution, EmphaSeis, was implemented successfully on two commercial projects.
			During the quarter we received our first award for a 3D acquisition project with our new JV partner in Columbia.
			SeisMovieTM, our real-time onshore permanent monitoring solution continues to see increased interest, particularly for heavy oil, CO2 sequestration and gas storage.

	•		Processing & Imaging revenue was down 4% year-on-year in $ and stable in €. Sequentially revenue was stable in $ with strong margins. During the quarter we opened new reservoir seismic centers in Europe, Africa and Brazil. Demand for high-end imaging technology for shale prospects further increased. The deployment of geovation, our new processing and imaging platform, will continue to bring the latest technology to our customers.
			Recent advances in our TTI RTM workflows uniquely provide the ability to pick 3D surfaces for enhanced tomographic velocity model building, leading to significant improvements in the precision of wide-azimuth depth images.
	•		Multi-client revenue was down 21% year-on-year in $ and 18% in €. Sequentially, revenue was down 9% in $ mainly impacted by lower marine after-sales. Capex for the second quarter remained sequentially stable at $86 million (€66 million) with prefunding increasing to 67%. The amortization rate averaged 57%, with 66% in land and 53% in marine. Net Book Value of the library at the end of June was at $740 million.

			Multi-client marine revenue was sequentially down 19% in $. Capex was at $72 million (€55 million). Prefunding was $42 million (€32 million), a rate of 59%. After-sales worldwide were low at $18 million (€14 million) impacted by the conditions in the Gulf-of-Mexico and the delay of the publication of pre-salt regulations in Brazil. All Gulf-of-Mexico wide-azimuth data will be delivered on schedule.
			Off the coast of Gabon, we successfully integrated the high-resolution geologic information of a Gravity Gradiometry survey in our multi-client data to better constrain the salt bodies and potential prospects.
			Multi-client land revenue was sequentially up 21% in $. Capex was at $14 million (€11 million). Interest continues to strengthen for our on-shore data in the US, especially the Haynesville survey which was completed in May and our upcoming new Marcellus shale program. Prefunding was $16 million (€12 million), a rate of 112%. After-sales were $17 million (€13 million).

Group EBITDAs was $166 million (€128 million), a margin of 26%.

		First Quarter				Second Quarter								Second Quarter
In millions		2010 ($)				2010 ($)				2009 ($)				2010 (€)				2009 (€)
Group EBITDAs			176				166				232				128				170
margin			25	%			26	%			30	%			26	%			30	%
Sercel EBITDAs			62				78				67				60				49
margin			28	%			31	%			28	%			31	%			28	%
Services EBITDAs			137				120				188				92				138
margin			27	%			26	%			34	%			26	%			34	%

Group Operating Income Group Operating Income was $37 million (€29 million), a margin of 6% including a positive impact of non-current items such as disposal of assets and reduction of liabilities. The strengthening performance of Sercel was offset by the continued low priced marine market and low marine multi-client contributions in Services.

		First Quarter				Second Quarter								Second Quarter
In millions		2010 ($)				2010 ($)				2009 ($)				2010 (€)				2009 (€)
Group Operating Income			37				37				67				29				49
margin			5	%			6	%			9	%			6	%			9	%
Sercel Op. Income			50				66				57				51				42
margin			22	%			27	%			24	%			27	%			24	%
Services Op. Income*			14				5				36				4				26
margin			3	%			1	%			6	%			1	%			6	%

Financial Charges

Financial charges were $34 million (€26 million).

Net Income was $8 million (€6 million). After the impact of minority interests of $5 million, EPS was €0.01 per ordinary share and $0.02 per ADS.

Cash Flow

Cash Flow from Operations

Cash flow from operations was $82 million (€65 million) down 62% year-on-year.

Capex

Global Capex was $163 million (€125 million) this quarter, an increase of 11% year-on-year.

	•		Industrial Capex was $78 million (€59 million)
	•		Multi-client Capex was $86 million (€66 million) a reduction of 16% in $ with a 67% prefunding rate

		First Quarter				Second Quarter
In million $		2010				2010				2009
Capex			142				163				147
Industrial			55				78				45
Multi-client			87				86				102

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Free Cash Flow

After interest expenses paid during the quarter, free cash flow was negative at $127 million.

On July 15, we completed an amendment to our January 2014 term loan B agreement which includes an extension of maturity to 2016 of a $340 million portion of our $515 million outstanding credit facility.

Second Quarter 2010 Comparisons with Second Quarter 2009

Consolidated Income Statement		First Quarter				Second Quarter								Second Quarter
In millions		2010 ($)				2010 ($)				2009 ($)				2010 (€)				2009 (€)
Exchange rate euro/dollar			1.398				1.303				1.335				1.303				1.335
Operating Revenue			696.1				646.9				778.9				498.0				572.6
Sercel			221.9				247.0				238.7				190.6				175.2
Services			511.3				459.8				557.6				353.3				409.3
Elimination			-37.1				-60.1				-17.4				-45.9				-11.9
Gross Profit			148.0				129.4				164.2				99.9				119.7
Operating Income			36.8				37.1				67.1				28.5				48.5
Sercel			49.6				65.8				56.7				50.5				41.9
Services			14.1				5.1				35.9				4.1				25.5
Corporate and Elimination			-26.9				-33.8				-25.5				-26.1				-18.9
Net Financial Costs			-23.9				-23.2				-41.3				-17.8				-30.6
Income Tax			-8.9				-2.7				-12.5				-2.2				-9.0
Deferred Tax on Currency Translation			-3.8				0.4				7.2				0.2				5.4
Income from Equity Investments			0.3				-3.2				2.7				-2.3				2.0
Net Income			0.5				8.3				23.2				6.2				16.5
Earnings per share (€) / per ADS ($)			-0.02				0.02				0.13				0.01				0.09
EBITDAs			175.5				166.4				231.7				128.0				170.0
Sercel			61.7				77.7				66.5				59.7				49.1
Services			136.8				120.2				187.7				92.4				137.6
Industrial Capex			54.9				77.7				45.2				59.1				32.8
Multi-client Capex			87.0				85.7				101.7				65.8				75.0

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First Half 2010 Financial Results

Group Revenue

Group Revenue was down 18% both in $ and in € year-on-year, reflecting our marine fleet capacity adjustment program, low priced backlog secured in the second half of 2009 and low marine multi-client sales, masking the strengthening performance of Sercel. Group Revenue was down 9% sequentially in $.

		Second Half				First Half								First Half
In millions		2009 ($)				2010 ($)				2009 ($)				2010 (€)				2009 (€)
Group Revenue			1 479				1 343				1 630				996				1 221
Sercel Revenue			418				469				440				350				329
Services Revenue			1 133				971				1 246				719				934
Eliminations			-72				-97				-56				-72				-42
Marine contract			444				398				634				295				475
Land contract			167				193				215				143				161
Processing			205				187				198				139				149
Multi-client			317				192				198				142				148
MC marine			241				134				173				99				130
MC land			77				59				25				43				19

Group EBITDAs was $342 million (€254 million), a margin of 25%.

		Second Half				First Half								First Half
In millions		2009 ($)				2010 ($)				2009 ($)				2010 (€)				2009 (€)
Group EBITDAs			478				342				514				254				385
margin			32	%			25	%			32	%			25	%			32	%
Sercel EBITDAs			98				139				131				104				98
margin			23	%			30	%			30	%			30	%			30	%
Services EBITDAs			403				257				431				190				323
margin			36	%			26	%			35	%			26	%			35	%

Group Operating Income was $74 million (€55 million), a margin of 5%.

		Second Half				First Half								First Half
In millions		2009 ($)				2010 ($)				2009 ($)				2010 (€)				2009 (€)
Group Operating Income			111				74				199				55				149
margin			7	%			5	%			12	%			5	%			12	%
Sercel Op. Income			75				115				111				86				83
margin			18	%			25	%			25	%			25	%			25	%
Services Op. Income*			61				19				142				14				106
margin			5	%			2	%			11	%			2	%			11	%

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Financial Charges

Financial charges were $68 million (€50 million).

Net Income was $9 million (€7 million). After the impact of minority interests of $9 million, EPS was €0.00 per ordinary share and $0.00 per ADS.

Cash Flow

Cash Flow from Operations

Cash flow from operations was $233 million (€173 million) down 32% year-on-year.

Capex

Global Capex was $302 million (€224 million) in the first half of the year, a reduction of 6% year-on-year.

	•		Industrial Capex was $129 million (€96 million)
	•		Multi-client Capex was $173 million (€128 million) a reduction of 10% in $ with a 62% prefunding rate

		Second Half				First Half
In million $		2009				2010				2009
Capex			264				302				322
Industrial			138				129				129
Multi-client			127				173				193

Free Cash Flow

After interest expenses paid during the first half, free cash flow was negative at $121 million.

Balance Sheet

Net Debt to Equity Ratio

The Group’s gross debt was $1.894 billion at the end of June 2010, corresponding to €1.543 billion following a 1.23 euro/dollar closing exchange rate.

With $442 million (€360 million) in available cash, Group net debt was $1.452 billion (€1.183 billion).

Net debt to equity ratio, at the end of June 2010, was 39%.

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First Half 2010 Comparisons with First Half 2009

Consolidated Income Statement		Second Half				First Half								First Half
In millions		2009 ($)				2010 ($)				2009 ($)				2010 (€)				2009 (€)
Exchange rate euro/dollar			1.392				1.348				1.335				1.348				1.335
Operating Revenue			1 479.1				1 343.0				1 630.1				996.0				1 221.1
Sercel			418.2				469.0				439.8				349.5				329.0
Services			1 132.7				970.9				1 245.8				718.8				933.6
Elimination			-71.9				-97.0				-55.5				-72.3				-41.5
Gross Profit			317.9				277.4				420.4				205.8				315.0
Operating Income			110.6				73.8				198.6				54.8				148.7
Sercel			75.3				115.4				111.0				86.0				83.0
Services*			61.3				19.2				142.0				14.2				106.3
Corporate and Elimination*			-26.0				-60.8				-54.3				-45.4				-40.6
Net Financial Costs			-89.4				-47.1				-72.5				-35.0				-54.3
Income Tax			-13.0				-11.7				-43.0				-8.6				-32.2
Deferred Tax on Currency Translation			-0.7				-3.4				7.6				-2.5				5.7
Income from Equity Investments			8.3				-2.8				3.3				-2.1				2.4
Net Income			15.8				8.8				93.9				6.6				70.3
Earnings per share (€) / per ADS ($)			0.09				0.00				0.59				0.00				0.44
EBITDAs			477.5				341.9				514.3				253.6				385.3
Sercel			97.7				139.4				130.7				103.9				97.8
Services			402.9				257.0				430.8				190.3				322.8
Industrial Capex			137.9				129.4				129.1				96.0				96.7
Multi-client Capex			126.5				172.6				192.8				128.0				144.5

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Other Information

	•		A French language conference call is scheduled today at 10:00am (Paris), 9:00am (London). To take part in the French language conference, simply dial in 5 to 10 minutes prior to the scheduled start time.
			— France call-in                           +33 1 72 00 13 64 — International call-in                      +44 203 367 94 59 — Replay                                     +33 1 72 00 15 01 & +44 203 367 94 60                                                            Code: 270603 #
	•		An English language conference call is scheduled today at 3:00pm (Paris) — 2:00pm (London) — 8:00am (US CT) — 9:00am (US ET). To take part in the English language conference, simply dial 5 to 10 minutes prior to the scheduled start time.
			— US Toll-Free                             1-877-485-3104 — International call-in                  1-201-689-8579 — Replay                                       1-877-660-6853 & 1-201-612-7415                                                         Event ID: 342 719 — You will be asked for the name of the conference: “CGGVeritas Q2 2010 results”.
	•		The presentation is posted on our website www.cggveritas.com and can be downloaded
	•		Detailed financial results (6K) are available on our website www.cggveritas.com
	•		The conference call will be broadcast live on our website www.cggveritas.com and a replay will be available for two weeks thereafter

About CGGVeritas

CGGVeritas (www.cggveritas.com) is a leading international pure-play geophysical company delivering a wide range of technologies, services and equipment through Sercel, to its broad base of customers mainly throughout the global oil and gas industry.

CGGVeritas is listed on the Euronext Paris (ISIN: 0000120164) and the New York Stock Exchange (in the form of American Depositary Shares, NYSE: CGV).

Investor Relations Contacts
Paris:		Houston:
Christophe Barnini		Hovey Cox
Tel: +33 1 64 47 38 10		Tel: +1 (832) 351-8821
E-Mail: invrelparis@cggveritas.com		E-Mail: invrelhouston@cggveritas.com

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THIS FORM 6-K REPORT IS HEREBY INCORPORATED BY REFERENCE INTO THE PROSPECTUS CONTAINED IN CGG VERITAS’ REGISTRATION STATEMENT ON FORM S-8 (REGISTRATION STATEMENT NO. 333-150384) AND SHALL BE A PART THEREOF FROM THE DATE ON WHICH THIS REPORT IS FURNISHED, TO THE EXTENT NOT SUPERSEDED BY DOCUMENTS OR REPORTS SUBSEQUENTLY FILED OR FURNISHED.

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, Compagnie Générale de Géophysique — Veritas has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

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