Mitcham Industries, Inc. Q4 2014 Earnings Conference Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Veny Aleksandrov - FIG Partners - Analyst : Good morning. My first question is about Latin America. It is picking up and there is renewed activity and Billy touched price a little bit on -- is permitting (inaudible) here or is it weather and is it just a couple of clients that are driving the market for now or it is all across the board?

Question: Veny Aleksandrov - FIG Partners - Analyst : Thank you. Then going back to the wireless, I know that you have already acquired a good number of [generals], which you have some in Canada, you have some working in Latin America, you are starting new project in Latin America. Are you -- for now are you okay or do we need to raise the CapEx for this year in order to acquire more if there is such an interest?

Question: Veny Aleksandrov - FIG Partners - Analyst : Okay, and my last question there was a [motion] -- a mentioning in the press release about borehole and some renewed interest there. Can you elaborate on that? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies.

Question: Veny Aleksandrov - FIG Partners - Analyst : Thank you. I do appreciate it.

Question: Georg Venturatos - Johnson Rice - Analyst : Good morning. Wanted to touch on the domestic side first. Obviously, sounds like still pretty challenging there, remains soft. I guess my question was absent that large project we saw this quarter, are things getting -- were they getting worse sequentially? Are they stable and still soft or how do you see that evolving over the next couple of quarters and then additionally, obviously, we are seeing less activity, but are you seeing a change in the project size mix as well?

Question: Georg Venturatos - Johnson Rice - Analyst : Got you. And then to follow onto that, you mentioned redeploying some channels out of the US. Can you remind us where you are today in terms of a channel count, where you might be after you redeploy some of those strategically?

Question: Georg Venturatos - Johnson Rice - Analyst : Okay, yes, that is what I was more curious on because it sounded like there was potential in the second half if things to pick up. Just wanted to make sure you were covered there. Great. Last one for me on the Seamap side, obviously sounds like you have got some opportunities there. Maybe you could just give a little more insight and you did a good job of it, but on the source controller opportunity with PGS, just how big of an impact you could see that over the next 12 months in terms of their needs with their existing vessels. And then maybe with that new version of BuoyLink 4DX, how does this -- how necessary is it for an upgrade? Do you see, guys, that -- is it more of a replacement or just an upgrade of existing technology?

Question: Georg Venturatos - Johnson Rice - Analyst : Great. I appreciate the answers.

Question: Joel Luton - Westlake Securities - Analyst : Good morning. With respect to the first quarter, you expect it to be weak and is that primarily because it was a pretty strong quarter a year ago?

Question: Joel Luton - Westlake Securities - Analyst : And is all that -- with respect to Canada, none of that is weather-related, that really doesn't impact you, right? Because people, companies get the equipment even though they may be impacted by the weather, you aren't. Is that the case?

Question: Joel Luton - Westlake Securities - Analyst : Because I know some specifically weather got tossed and then the [TGC] with respect to just the cold winter or just extra cold. I know they need [cold]. And then also with your stock repurchases, you have taken on a little bit of debt to buy the nodal systems. Do you anticipate maybe scaling back stock repurchases because you have a little bit more debt on the balance sheet or any comments on that?

Question: Joel Luton - Westlake Securities - Analyst : Okay, thanks very much.

Question: Mark Brown - Global Hunter Securities - Analyst : Good morning. You touched on the Middle East as a location where you might see some growth and recurring business. Just curious, what kind of growth you expect, and any color would be appreciated.

Question: Mark Brown - Global Hunter Securities - Analyst : Very good, very good. Wanted to ask about the oversupply of vessel capacity. You indicated that there may be some more consolidation regarding your customer base. And wanted to understand a little bit what the impact of that would be on your business. Would it be fewer customers and less dollars as a result? Or maybe you could just clarify that for me.

Question: Mark Brown - Global Hunter Securities - Analyst : Okay, thank you very much.

Question: Tyson Bauer - Kansas City Capital - Analyst : Good morning. Couple of quick questions. When you describe your outlook for fiscal 2015, how much of that whether it is deemed successful or similar to fiscal 2014 really rides on that next winter season in Canada as being the teeter-tot fulcrum whether it's -- you are going to see growth or not? And we probably won't see an indication of that until fiscal third quarter?

Question: Tyson Bauer - Kansas City Capital - Analyst : Okay. So that goes on the fiscal 2016 almost. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies.

Question: Tyson Bauer - Kansas City Capital - Analyst : Are you then viewing this as -- we are bouncing along the bottom here especially in North America, it can't get much worse, that kind of suggestion?

Question: Tyson Bauer - Kansas City Capital - Analyst : Next topic is a two-parter. Give us your target lease pool percentage for wireless versus cable. And is that expected to be achieved because you are going to be making more of your purchases with wireless? Or will we see that grow in respect because you expect to increase your lease pool sales of some of the older cable systems?

Question: Tyson Bauer - Kansas City Capital - Analyst : Well, that is where we need to be. The lease pool depreciation, you had a large CapEx in the Q4 with the wireless that you brought in. Give us an idea of what some of the older equipment rolling all throughout the year in combination with what you just purchased in the fourth quarter, what should we expect on that depreciation line?

Question: Tyson Bauer - Kansas City Capital - Analyst : And is there a very much a differential in pricing? You are talking about a lot more strength international market, that is where the focus is going to be versus domestic. Give us that pricing trend here, it sounds like it is very highly competitive especially when you have got large-scale projects that you are bidding on versus what you are seeing in the growing markets, whether it is Latin America, Europe, or Russia.

Question: Tyson Bauer - Kansas City Capital - Analyst : And help remind us, your purchase agreement with Sercel, I think you have a minimum that you need to achieve. Is what you are describing for the CapEx for fiscal 2015, are we towards those minimal levels?

Question: Tyson Bauer - Kansas City Capital - Analyst : So, was that a mutual agreement?

Question: Tyson Bauer - Kansas City Capital - Analyst : All right, thank you, gentlemen.