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Thursday, September 28, 2023

ION Geophysical Corp. (IO) Stock on a Rise in Aftermarket, Here’s the Reason

ION Geophysical Corp. (IO), a company that provides data-driven decision-making to offshore energy, ports, and defense industries worldwide, has surged 5.88% in aftermarket trading session. As a result, IO stock is trading at $0.9 at the time of the writing. The surge has come as the company announced forbearance and amendment related to its revolving credit agreement. On Monday, IO closed the day at $0.85 after declining 1.23% during the regular trading session.

Why IO Surging?

In the late hours of Friday, IO announced that it has entered into a Forbearance and Fifth Amendment with PNC Bank, National Association under its Revolving Credit and Security Agreement. Under the agreement, the PNC has agreed to waive a cross-default that would have occurred under the Credit Agreement. The move has come as the company did not pay the scheduled interest payment which was due on December 15.

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Agreement with Noteholders

Alongside that, IO also announced to have entered into agreements with holders of more than 79% of its notes, due in 2025, to forbear from forcing their rights and remedies arising as a result of the company’s make the December 15, 2021 interest payment due on the 2025 Notes. The company extended this forbearing deadline up until the 15th of February 2022. The forbearance was subject to the terms and conditions of the relevant agreements with PNC and the noteholders.

Expected Q4 2021 Revenue

In addition to the above developments, IO also announced that it expects the fourth-quarter revenue for the company to stand at about $40 million. That would be an increase of 45% year-over-year. Although sequentially, the expected fourth-quarter revenue declined by 10%, the 2HFY2021 revenues increased about 150% when compared with 1HFY2021 revenues.

Future Outlook for IO

During the last month, IO stock has slid by approximately 40%, mostly owing to the short-selling of the stock. The company however is hopeful that the coming times would see an increased investment in its stock.

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