ION Q2 2021 Earnings Call

Earnings Call Presentation

August 12, 2021

Corporate Participants and Contact Information

2

CONTACT INFORMATION

If you would like to view a replay of today's call, it will be available via webcast in the Investor Relations section

of the Company's website at iongeo.com for approximately 12 months.

For discussion of non-GAAP measures, please see our Earnings Release.

CHRIS USHERPresident and

Chief Executive Officer

MIKE MORRISONExecutive Vice President

and Chief Financial Officer

Forward-Looking Statements

3

The information included herein contains forward-looking statements within the meaning of

Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.

Actual results may vary fundamentally from those described in these forward-looking statements.

All forward-looking statements reflect numerous assumptions and involve a number of risks and

uncertainties.

These risks and uncertainties include risk factors that are disclosed by ION from time to time in its

filings with the Securities and Exchange Commission.

Q2-21 Operational and Financial Highlights

4

Q2-21 revenues improved 40% sequentially

Adjusted EBITDA was slightly positive with >$40 million

of cost reductions from 2020 intact

Phase II of our North Sea 3D program is proceeding

ahead of schedule

Made great progress on our maritime digitalization

strategy in new markets

Completed bond exchange and rights offering in April$10

$21

$14

$0

$5

$10

$15

$20

$25

Q2-20 Q1-21 Q2-21

Backlog ($m)

$23

$14

$20

$0

$5

$10

$15

$20

$25

Q2-20 Q1-21 Q2-21

Revenue ($m)

EPTS OO

Please see the earnings release for reconciliations to comparable GAAP measures.

Market Outlook and ION Strategy

5

Commodity prices have rebounded nearly 50% this year

Expect seismic market will remain challenging near-term

Offshore oil and gas is expected to remain an important part of

the energy mix to meet demand for at least the next 2 decades

Focused on helping companies efficiently find and develop

energy resources with lower emissions and environmental impact

Optimize Maritime Operations

Optimize Offshore Energy

Diversifying outside energy into much larger, less cyclical markets

Significant digitalization opportunities to enable smarter, safer

management of maritime assets and people and reduce

environmental impact and greenhouse gas emissions

Focused on optimizing port management, energy logistics and

maritime operations markets

E&P Technology and Services Q2-21 HighlightsIncrease market share by providing new 3D data with higher earnings potential

6

ION

A

BC

D

Other

Market Opportunity

ION ~3% of ~$2B market largely

comprised of new 3D data

Opportunity to provide new 3D data,

increasing share of a mature market

with higher, more consistent earnings

0

200,000

400,000

600,000

800,000

2015 2021

2D Data 3D Data

ION Data Library Evolution

Program Type Revenue

2D $5-40m

3D Reimaging $5-40m+

3D Towed Streamer $35-90m

3D Ocean Bottom $90-220m

Higher Earnings Potential

Only takes 1-2 new 3D projects

annually to double market share

Costs largely underwritten by clients

Strategy Shift

2D3D

Past 2D Focus New 3D Data

Enabling Technologies

Tier 1 Imaging

Technology

3D Reimaging

Track Record

Gemini™ Low

Frequency

Source

+

+

Launched Initial 3D

Project in North Sea

Up to 11,000 sq km

acquired 2020-2021

E&P Technology and Services Q2-21 Highlights

7

Excellent Gemini™ source performance

– Shell nearly doubled the program size and

highlighted Gemini’s role in enhancing exploration

insights in a more eco-friendly manner

– Delivered expected uplift in low frequency content

– Submitted proposals for additional deployments

Top tier imaging drives repeat business

– Imaging improvements using ION’s proprietary

toolkit led to several umbrella contracts last year

that helped derisk our 2021 revenue plan

– Secured the first project commitment under the

multi-year umbrella contract with an energy Major

we mentioned on last quarter’s conference call

Operations Optimization Q2-21 Highlights

8

Revenues improved, consistent with offshore

seismic activity improving seasonally

– ION AnyWare™ overcomes client access challenges

Leveraging technologies and competencies to

optimize decision-making in new markets

Increasing Marlin™ traction

– Continue to receive positive feedback on SW value

– Recently expanded business development team and

increased outreach in NAM, LAM and Africa

– Climate-smart digital infrastructure is garnering

significant interest for country-scale solutions

Projects well aligned to qualify for EXIM Bank financing

Introductions made to >15 countries

– Technology focused on improving efficiency and asset

utilization, reducing HSE exposure and emissions

Devices’ diversification strategy is to develop near real-time monitoring solutions that

improve the safety and environmental compliance of offshore oil and gas operations

– WellAlert™ leverages our core competencies, targets a growing market associated with sustainability

and aligns with our strategy to provide decision support data and analytics

– Expect regulators will drive adoption of proactive monitoring systems that provide more frequent,

accurate measurements to assure safe operating environments

– Systematically working to understand the challenges and requirements in various geographies

– Conversations advanced beyond our initial target market and started developing a full-scale prototype

Operations Optimization Q2-21 Highlights

9

$0

($7)

$0

($8)

($6)

($4)

($2)

$0

$2

Q2-20 Q1-21 Q2-21

Adjusted EBITDA ($m)

$10

$21

$14

$0

$5

$10

$15

$20

$25

Q2-20 Q1-21 Q2-21

Backlog ($m)

Q2-21 Financial Results

Revenue 40% QoQ and (13)% YoY

– E&P Technology & Services up 62% QoQ

Started MNSH II and increased 2D data library sales

– Operations Optimization up 18% QoQ

Consistent with increasing offshore activity

Net loss of ($24m) vs ($7m) QoQ

Adjusted net loss of ($11m) vs ($15m) QoQ

Adjusted EBITDA of $0.1m vs ($7m) from prior

quarter and consistent with a year ago

– >$40m of cost savings from 2020 remain intact

Backlog at $14m

Total liquidity of $33m, including $20m revolver

borrowings

10 Please see the earnings release for reconciliations to comparable GAAP measures.

$38

$34

$27

$0

$10

$20

$30

$40

Q4-20 Q1-21 Q2-21

Cash & Cash Equivalents ($m)

$23

$14

$20

$0

$5

$10

$15

$20

$25

Q2-20 Q1-21 Q2-21

Revenue ($m)

EPTS OO

Capital Market Transactions and Cost Reduction Program

11

Existing

Bond

(2021)

$121m

New

Bond

(2025)

$116m

Completed bond exchange and rights offering in April

– Bond restructuring• Exchanged 94% of the existing 9.125% 2nd Lien Notes due

Dec-2021 for new 8.00% 2nd Lien Notes due Dec-2025

• Extends maturity 4 years with a lower interest rate

• Convertible feature provides path to convert debt to equity over coming years ($3.00 conversion price)

• Only $7m of bonds due in Dec-2021 remain outstanding

– Rights offering• Raised $42m out of a maximum of $50m, paid off cash

portion of bond exchange and put ~$14m into the business

Market recovery timing uncertainty and low H1-21 revenues triggered a going concern issue for ION

Implementing $15-20m cost reduction program, building on >$40m cut last year, to continue to right size business while still being able to capitalize on evolving market opportunities

Pre

exchange

Post

exchange

Post

conversion

18m

shares

Debt

converts

to stock

68m

shares

29m

shares

Capitalizing on our Strengths to Address Key Industry Needs

Laser-focused on strategy execution and doing fewer things, better

Expect momentum to continue building as the year unfolds

Committed to continuing to right size the business to provide sufficient runway for successful

diversification efforts while the seismic market continues to recover

12

Capturing share of 3D new

acquisition multi-client market

Expanding software to

optimize offshore operations

Supporting

energy

transition

Sustainable

use of marine

resources

Combating

climate

change

Optimal

energy

development

Offshore data and digitalization

are key ingredients for enabling:

Both business segments are making progress

penetrating much larger addressable markets:

Q&A

13