Pulse Data Inc. reports Q2 2007 results and declaration of quarterly dividend



    TSX Symbol - PSD

    CALGARY, Aug. 13 /CNW/ - Douglas Cutts, President and Chief Executive
Officer of Pulse Data Inc. ("Pulse" or "the Company"), is pleased to report
the financial and operating results of Pulse for the three and six months
ended June 30, 2007.
    Mr. Cutts is also pleased to announce that Pulse has declared its
seventeenth consecutive quarterly dividend. The dividend is $0.0375 per common
share and will be paid on September 20, 2007 to shareholders of record at the
close of business on September 6, 2007. The Company's Dividend Reinvestment
Plan for eligible shareholders will be available for this dividend.

    
    HIGHLIGHTS FOR THE SECOND QUARTER AND FIRST HALF OF 2007

        -  Seismic data library sales increased by 59 percent to a second-
           quarter record of $10.5 million for the three months ended
           June 30, 2007, from $6.6 million for the second quarter of 2006.
        -  Seismic data library sales also achieved a first-half record,
           increasing by 26 percent to $21.1 million for the six months ended
           June 30, 2007 from $16.7 million for the first half of 2006.
        -  First-half free cash flow(b) set a record of $14.3 million for the
           six-month period ended June 30, 2007, compared to $5.7 in the
           first half of 2006, representing an 151 percent increase period-
           over-period.
        -  Pulse had working capital of $8.0 million (including cash of
           $8.6 million) at June 30, 2007 compared to $5.7 million at
           December 31, 2006 and $16.4 million at June 30, 2006.
        -  During the second quarter Pulse repurchased 34,200 common shares
           through the Normal Course Issuer Bid at a total cost of $89,000.

    Subsequent to the end of the second quarter:

        -  On July 11, 2007 Pulse commenced a 3D seismic participation survey
           in the Deep Basin area of west-central Alberta.
        -  On July 27, 2007 Pulse closed a bought-deal private placement
           financing of 6.44 million common shares at an issue price of $2.70
           per common share for total gross proceeds of $17.4 million.
        -  On July 31, 2007, Pulse acquired the remaining 50 percent interest
           in certain seismic data owned jointly with a partner, consisting
           of 1,388 net square kilometres of 3D seismic data and 65 net
           kilometres of 2D seismic data, for $11.1 million, bringing Pulse's
           interest in this data to 100 percent.

    Financial Highlights
    (000s except per share data)

                     Three months ended       Six months ended    Year ended
                          June 30,                June 30,          Dec. 31
                          --------                --------          -------
                      2007        2006        2007        2006        2006
                      ----        ----        ----        ----        ----
                        (unaudited)             (unaudited)        (audited)
    Revenue from
     continuing
     operations:
      Data library
       sales       $  10,527   $   6,634   $  21,150   $  16,732   $  34,214
      Participation
       surveys     $       -   $   3,058   $       -   $   3,058   $   3,058
      Corporate
       and other   $       -   $       -   $       -   $       -   $    (130)
                   ----------------------------------------------------------
    Total revenue
     from
     continuing
     operations    $  10,527   $   9,692   $  21,150   $  19,790   $  37,142
    Amortization
     of seismic
     data library  $   6,288   $   7,284   $  12,576   $  11,963   $  22,574
    Net earnings
     from
     continuing
     operations    $     336   $     314   $   1,173   $   1,766   $   3,474
    Net earnings
     from
     continuing
     ops per share:
      Basic and
       diluted     $    0.01   $    0.01   $    0.02   $    0.04   $    0.07
    Net loss for
     the period    $     (50)  $  (5,114)  $    (520)  $  (5,075)  $  (3,290)
    Net loss
     per share:
      Basic and
       diluted     $  0.00(a)  $(0.11)(a)  $(0.01)(a)  $(0.11)(a)  $(0.07)(a)
    Funds from
     continuing
     operations(b) $   6,481   $   5,933   $  14,331   $  12,767   $  25,851
    Funds from
     continuing
     operations
     per share(b):
      Basic        $    0.13   $    0.13   $    0.30   $    0.28   $    0.55
      Diluted      $    0.13   $    0.12   $    0.29   $    0.27   $    0.54
    Free cash
     flow(b)       $   6,481   $  (1,229)  $  14,331   $   5,699   $  19,155
    Working
     capital       $   7,999   $  16,398   $   7,999   $  16,398   $   5,681
    Total assets   $ 121,996   $ 112,928   $ 121,996   $ 112,928   $ 131,910
    Capital
     expenditures:
      Seismic data
       purchases   $       -   $       -   $       -   $       -   $  36,850
      Participation
       surveys     $       -   $    7162   $       -   $   7,068   $   6,696
      Changes to
       work in
       progress    $       -   $  (1,113)  $       -   $    (181)  $    (192)
      Property and
       equipment
       additions   $     115   $   1,434   $     189   $   1,486   $     128
                   ----------------------------------------------------------
    Total capital
     expenditures  $     115   $   7,483   $     189   $   8,373   $  43,482
    Total long-term
     debt (net of
     current
     maturities and
     debt financing
     costs)        $  27,478   $  17,872   $  27,478   $  17,872   $  31,996
    Shareholders'
     equity        $  72,256   $  75,573   $  72,256   $  75,573   $  75,357
    Weighted
     average shares
     outstanding:
      Basic       48,016,084  46,792,140  47,973,196  46,336,770  47,145,373
      Diluted     48,857,668  48,078,834  48,603,615  47,531,182  48,007,006
    Shares
     outstanding
     at period
     end          48,070,787  47,254,519  48,070,787  47,254,519  47,919,342

    (a) Basic weighted average shares outstanding are used to calculate loss
        per share.
    (b) These non-GAAP financial measures are defined in the Financial
        Summary below.

    Seismic Library:

      2D in net
       kilometres    257,216     239,822     257,216     239,822     257,216
      3D in net
       square
       kilometres      9,823       9,679       9,823       9,679       9,823
    

    FINANCIAL SUMMARY

    The Company's continuous disclosure documents provide discussion and
analysis of "free cash flow", "funds from operations" and "funds from
operations per share". These financial measures do not have standard
definitions prescribed by generally accepted accounting principles (GAAP) in
Canada and, therefore, may not be comparable to similar measures disclosed by
other companies. The Company has included these non-GAAP financial measures
because management, investors, analysts and others use them as measures of the
Company's financial performance. The Company's definition of free cash flow is
cash available for debt servicing, discretionary capital expenditures and the
payment of dividends, and is calculated as funds from operations less
participation survey additions to the data library. The Company's definition
of funds from operations is cash flow from operations as prescribed by
Canadian GAAP, but excluding the impact of changes in non-cash working
capital. Funds from operations per share is defined as funds from operations
divided by the weighted average number of shares outstanding for the period.

    Overview

    Free cash flow for the first half of 2007 was $14.3 million, compared to
free cash flow of $5.7 million for the first half of 2006. This 151.5 percent
period-over-period increase in free cash flow is attributable to the increase
of 26.3 percent in data library sales and to the Company not completing any
seismic participation surveys in the first half of 2007.
    Pulse had working capital of $8.0 million (including cash of
$8.6 million) at June 30, 2007 compared to working capital of $16.4 million
(cash of $17.6 million) at June 30, 2006 and $5.7 million (cash of $2.2
million) at December 31, 2006.
    Net earnings from continuing operations for the six months ended June 30,
2007 was $1.2 million ($0.02 per share basic and diluted), compared to net
earnings from continuing operations of $1.8 million ($0.04 per share basic and
diluted) for the same period in 2006. This decrease, in spite of record
seismic data library sales, was due to increased amortization, general and
administrative expense and interest expense. Net earnings from continuing
operations for the three months ended June 30, 2007 were $336,000 ($0.01 per
share basic and diluted) compared to $314,000 ($0.01 per share basic and
diluted) for the comparable period of 2006. This improvement reflects higher
data library sales for the period, and lower amortization expense due to the
2006 amortization including $2.5 million related to the participation survey
completed in the second quarter of 2006.This was offset by higher general and
administrative and interest expenses, resulting in a 7 percent increase to net
earnings over the comparable period.
    The net loss for the six months ended June 30, 2007 was $520,000
($0.01 per share basic and diluted) compared to a net loss of $5.1 million
($0.11 per share basic and diluted) for the same period in 2006. The net loss
for the three months ended June 30, 2007 was $50,000 ($0.00 per share basic
and diluted) compared to a net loss of $5.1 million ($0.11 per share basic and
diluted) for the same period in 2006. A significant factor contributing to
this reduction in the loss for both the second quarter and the first half of
2007 is due to the writedown of certain Terrapoint assets of $767,000, after
tax, in the first quarter for 2006 and $4.86 million, after tax, in the second
quarter of 2006. When calculating the loss per share for the six months and
quarters ended June 30, 2007 and 2006, the basic number of shares outstanding
has been utilized, as using diluted shares would have the effect of
inappropriately decreasing the net loss per share.
    Funds from continuing operations for the first six months of 2007
totalled $14.3 million ($0.30 per share basic and $0.29 per share diluted),
compared to $12.8 million ($0.28 per share basic and $0.27 per share diluted)
for the first six months of 2006. Funds from operations per share for 2007 and
2006 are based on the weighted average shares outstanding of 47,973,196
(diluted - 48,603,615) for the first six months of 2007, compared to
46,336,770 (diluted - 47,531,182) for the comparable period of 2006. Funds
from continuing operations for the three months ended June 30, 2007 were
$6.5 million ($0.13 per share basic and diluted), compared to $5.9 million
($0.13 per share basic and $0.12 per share diluted) for the second quarter of
2006. The funds from operations per share for the second quarters of 2007 and
2006 are based on the weighted average shares outstanding of 48,016,084
(diluted - 48,857,668) for the second quarter of 2007, compared to 46,792,140
(diluted - 48,078,834) for the comparable period of 2006.
    During the quarter ended June 30, 2007, the Company repurchased 34,200
common shares under the Normal Course Issuer Bid at an average price of $2.60,
for a total cost of $89,000.
    Pulse paid its sixteenth consecutive quarterly dividend of $0.0375 per
common share on June 20, 2007.
    Subsequent to the end of the reporting periods, on July 27, 2007 Pulse
closed a "bought-deal" private placement financing of 6.44 million common
shares at an issue price of $2.70 per common share for total gross proceeds of
$17,388,000 (the "offering"). The offering included a private placement of
4.5 million common shares at $2.70 per share, an Underwriter's Option that was
fully exercised for 1.1 million common shares at $2.70 per share, and an
Overallotment Option granted to the underwriters that was fully exercised for
an additional 840,000 common shares at $2.70 per common share. Pulse used the
proceeds of the offering to finance a 3D seismic data acquisition of
$11.1 million from a joint venture partner and, subsequently, to fund a 3D
seismic participation survey program consisting of a minimum 150 net square
kilometres in the Deep Basin area of west-central Alberta.

    Revenue

    Revenue from continuing operations includes data library sales and
participation survey revenues. There were no participation surveys completed
in the first half of 2007. There was one 3D participation survey completed in
the first half of 2006, which generated participation survey revenue of
$3.1 million. For the six months ended June 30, 2007, seismic data library
sales reached $21.1 million, compared to $16.7 million for the same period in
2006, an increase of 26.3 percent. For the three months ended June 30, 2007,
seismic data library sales were $10.5 million, compared to $6.6 million for
the same period in 2006. The increases for both the second quarter and first
half of 2007 were due in part to greater demand for seismic data for
exploration from junior oil and natural gas companies, in part to the
additional sales generated from the newly acquired Foothills 2D dataset which
Pulse purchased in November 2006, and in part to a general price increase for
seismic data library licences effective January 1, 2007.

    Data Library

    Pulse acquires seismic data to grow its data library through two main
methods. The Company purchases proprietary rights to complementary seismic
data sets when the opportunity arises, and conducts participation surveys.
During the first six months of 2007, Pulse did not acquire any additional
seismic data, and did not complete any participation survey programs. Pulse
commenced a participation survey in July 2007, subsequent to the end of the
second quarter, in the west-central Alberta area, consisting of a minimum of
150 net square kilometres of 3D seismic data. Pulse expects to obtain at least
65 percent pre-funding for this planned survey and expects to deliver the data
to the customers by the end of the third quarter of 2007. There is no
exclusivity period associated with this participation survey which permits the
Company to commence licensing of the seismic data immediately after delivery.
In comparison, during the first six months of 2006 the Company completed a
237-square-kilometre 3D participation survey in west-central Alberta at a cost
of $6.7 million.

    Liquidity, Capital Resources and Capital Requirements

    At June 30, 2007 the working capital position of Pulse, including the
current portion of long-term debt of $8.0 million, was $8.0 million, compared
to $5.7 million at December 31, 2006. For the six months ended June 30, 2007
Pulse generated $14.3 million in funds from continuing operations, had a net
change of $3.3 million in non-cash working capital items relating to
continuing operations and utilized working capital for long-term debt
repayment ($4.0 million), dividends ($3.6 million) and to finance its LiDAR
operations ($4.4 million). This resulted in an increase of $6.5 million to the
cash balance, which was $8.6 million at June 30, 2007.
    With the continued trend of strong seismic data sales, Pulse management
expects that the Company's funds from operations will be sufficient to finance
future operations, service debt, pay dividends and carry out the budgeted
capital expenditures through 2007. The ongoing growth in the Company's seismic
data library continues to position Pulse to be a leading provider of valuable
seismic data to industry participants well into the future. Historical data
sales analysis shows that most seismic data retains its value for many years.
Utilizing the recent technological advancements in data reprocessing, the
Company's clients are able to enhance the quality of older data in the
library.

    
    PULSE DATA INC.
    Interim Consolidated Balance Sheets

    (In thousands of dollars)(unaudited)
    -------------------------------------------------------------------------
                                                        June 30, December 31,
                                                           2007         2006
    -------------------------------------------------------------------------
    Assets

    Current assets:
      Cash and cash equivalents                        $   8,639   $   2,181
      Accounts receivable                                  9,310      16,191
      Prepaid expenses                                       103         233
      Assets held for sale                                 4,393       3,809
    -------------------------------------------------------------------------
                                                          22,445      22,414

    Seismic data library                                  88,113     100,688
    Assets held for sale                                  10,453       6,943
    Property and equipment                                   943         904
    Investments                                                -         351
    Other                                                     42         610

    -------------------------------------------------------------------------
                                                       $ 121,996   $ 131,910
    -------------------------------------------------------------------------

    Liabilities and Shareholders' Equity

    Current liabilities:
      Accounts payable and accrued liabilities         $   1,944   $   4,002
      Deferred revenue                                     2,162       3,781
      Current portion of long-term debt                    8,004       8,004
      Liabilities held for sale                            2,336         946
    -------------------------------------------------------------------------
                                                          14,446      16,733

    Long-term debt                                        27,478      31,996
    Future income taxes                                    7,816       7,824

    Shareholders' equity:
      Share capital                                       55,228      54,887
      Contributed surplus                                  1,660       1,305
      Retained earnings                                   15,368      19,165
    -------------------------------------------------------------------------
                                                          72,256      75,357

    -------------------------------------------------------------------------
                                                       $ 121,996   $ 131,910
    -------------------------------------------------------------------------



    PULSE DATA INC.
    Interim Consolidated Statements of Earnings (loss) and Retained Earnings

    (In thousands of dollars, except per share data)(unaudited)
    -------------------------------------------------------------------------
                                    Three months             Six months
                                    ended June 30           ended June 30
                               ----------------------  ----------------------
                                    2007        2006        2007        2006
    -------------------------------------------------------------------------
    Revenue:
      Data library sales       $  10,527   $   6,634   $  21,150   $  16,732
      Participation survey             -       3,058           -       3,058
    -------------------------------------------------------------------------
    Total Revenue              $  10,527   $   9,692   $  21,150   $  19,790

    Expenses:
      Amortization of seismic
       data library                6,288       7,284      12,576      11,963
      Operating                      907       1,091       1,709       2,060
      Depreciation and
       amortization                   78          87         149         180
      (Gain) loss on assets
       held for trading              (42)          -           6           -
      General and administrative
       expenses                    2,237       1,225       3,683       2,774

    Interest:
      Long-term debt                 682         439       1,424         859
      Other                          (87)       (163)       (165)       (240)
    -------------------------------------------------------------------------
                                     595         276       1,259         619

    -------------------------------------------------------------------------
    Earnings (loss) from
     continuing operations
     before income taxes             464        (271)      1,768       2,194
    Income taxes:
      Current                        608       1,418         677       2,182
      Future (reduction)            (480)     (2,003)        (82)     (1,754)
    -------------------------------------------------------------------------
                                     128        (585)        595         428
    Net earnings from
     continuing operations     $     336   $     314   $   1,173   $   1,766

    -------------------------------------------------------------------------
    Loss from discontinued
     operations, net
     of income taxes               (386)      (5,428)     (1,693)     (6,841)

    -------------------------------------------------------------------------
    Net loss                   $    (50)   $  (5,114)  $    (520)  $  (5,075)
    Retained earnings,
     beginning of period         17,219       27,834      19,165      29,545
    Change in accounting policy       -            -         322           -
    Dividends paid               (1,801)      (1,768)     (3,599)     (3,518)

    -------------------------------------------------------------------------
    Retained earnings,
     end of period             $ 15,368    $  20,952   $  15,368   $  20,952
    -------------------------------------------------------------------------

    Net earnings per share from
     continuing operations,
     basic and diluted         $   0.01    $    0.01   $   0.02    $    0.04
    Net loss per share, basic
     and diluted               $   0.00    $   (0.11)  $  (0.01)   $   (0.11)

    -------------------------------------------------------------------------



    PULSE DATA INC.
    Interim Consolidated Statements of Cash Flows

    (In thousands of dollars)(unaudited)
    -------------------------------------------------------------------------
                                    Three months             Six months
                                    ended June 30           ended June 30
                               ----------------------  ----------------------
                                    2007        2006        2007        2006
    -------------------------------------------------------------------------

    Cash provided by (used in):

    Continuing operations:
      Net earnings             $     336   $     314   $   1,173   $   1,766
      Items not involving cash:
        Amortization of seismic
         data library              6,288       7,284      12,576      11,963
        Depreciation and
         amortization                 78          87         149         180
        Unrealized (gain) loss
         on foreign exchange          37        (112)          -         (74)
        Future income taxes
         (reduction)                (480)     (2,003)        (82)     (1,754)
        Stock-based compensation     226         346         434         650
        (Gain) loss on assets
         held for trading            (42)          -           6           -
        Other                         38          17          75          36
    -------------------------------------------------------------------------
    Funds from continuing
     operations                    6,481       5,933      14,331      12,767
    Net change in non-cash
     working capital items
     related to continuing
     operations                     (927)      4,473       3,308       8,226
    -------------------------------------------------------------------------
                                   5,554      10,406      17,639      20,993
    Discontinued operations:
      Funds from discontinued
       operations                   (534)       (259)     (2,221)       (778)
      Additions to property
       and equipment                (141)       (135)     (2,526)       (231)
      Net change in non-cash
       working capital items
       related to discontinued
       operations                   (711)      1,655         362       2,001

    -------------------------------------------------------------------------
                                  (1,386)      1,261      (4,385)        992
    Financing:
      Repayment of long-term debt (2,001)     (1,524)     (4,002)     (3,100)
      Issue of share capital          19         895          40       1,084
      Increase in deferred charges     3           -           3           -
      Dividends paid              (3,377)     (3,518)     (3,377)     (3,518)
    -------------------------------------------------------------------------
                                  (5,356)      4,147      (7,336)     (5,534)
    Investing:
      Additions to seismic data
       library through
       participation surveys           -      (7,162)          -      (7,068)
      Decrease in participation
       surveys in progress             -       1,113           -         181
      Additions to property
       and equipment                (115)     (1,434)       (189)     (1,486)
      Cash sales of investments      729           -         729           -
      Net change in non-cash
       working capital items
       related to investing            -        (365)          -        (856)
    -------------------------------------------------------------------------
                                     614      (7,848)        540      (9,229)
    -------------------------------------------------------------------------
    Increase (decrease) in
     cash position                  (574)      7,966       6,458       7,222
    Cash and cash equivalents,
     beginning of period           9,213       9,796       2,181      10,540
    -------------------------------------------------------------------------
    Cash and cash equivalents,
     end of period             $   8,639   $  17,762   $   8,639   $  17,762
    -------------------------------------------------------------------------
    

    OUTLOOK

    Pulse's record first and second quarter seismic data library sales were
in line with the Company's expectations. Of note, data library sales have been
virtually the same for each of the last three fiscal quarters. The Company's
working capital position is solid, with an increase of $6.5 million in cash on
hand since the end of 2006.
    The second quarter for Pulse is historically more volatile than the
first; some years it is quite weak, while in others it is even stronger than
the first quarter. This year, uncertainty within the oil and natural gas
industry concerning commodity prices and the pace of field activity over the
coming year appears to be translating into some decision-making hesitancy
regarding exploration-related activities, including seismic purchases. Pulse
is taking a cautious outlook with respect to the third and fourth quarters of
2007.
    Pulse continues to benefit from the seismic sub-sector's position within
the overall service industry's price and activity dynamic. Because spending on
seismic data represents a small proportion of oil and natural gas company's
capital budgets, and because seismic interpretation remains key to producers'
longer-term growth and success, spending on seismic data tends not to move in
lockstep with commodity prices and drilling rates. This tends to insulate
seismic providers, at least partially, from price-driven industry volatility.
    By building on the solid momentum of seismic data sales generated in the
first half of 2007, Pulse continues to foresee reasonable levels of licensing
activity, revenue, operating margin and free cash flow in the months ahead. We
are also optimistic about a strong year ahead for the Company in 2008. We will
maintain our overall philosophy of acquiring quality seismic data in whichever
way is most efficient and expedient, whether through acquisition of additional
existing data sets or through further participation surveys. Pulse management
expects that its funds from operations will be sufficient to finance
operations, service debt, and continue to pay dividends and carry out the
budgeted capital expenditures through 2007. Pulse continues to work towards a
disposition of the Terrapoint business unit by the end of the third quarter of
2007.

    CONFERENCE CALL

    On August 10, 2007 Pulse received an unsolicited offer from 6818862
Canada Inc., an indirect wholly-owned subsidiary of Seitel, Inc., to acquire
all of the outstanding shares of the Company. As a result Pulse has cancelled
the Q2 2007 conference call originally scheduled for Tuesday, August 14, 2007
at 1:00 p.m. EDT (11:00 a.m. MDT).

    CORPORATE PROFILE

    Pulse is a Calgary-based company specializing in seismic data
acquisition, licensing and marketing. Pulse's seismic library consists of
approximately 11,400 net square kilometres of 3D seismic data and 257,300 net
kilometres of 2D seismic data.
    Pulse trades on the Toronto Stock Exchange under the symbol PSD.

    Certain information contained herein may constitute forward-looking
statements under applicable securities laws. Such statements are subject to
known or unknown risks and uncertainties that may cause actual results to
differ materially from those anticipated or implied in the forward-looking
statements. Investors are encouraged to review the "Risk Factors" section of
the Management's Discussion and Analysis in the Company's most recent annual
and interim reports for a discussion of risks that could affect the Company's
operations and financial results. Forward-looking statements are based upon
management's assumptions, expectations and estimates at the time that such
statements are made. Pulse does not update forward-looking statements should
circumstances change or management's assumptions, expectations or estimates
change, except as required by law.




For further information:

For further information: Douglas Cutts, President and C.E.O., Tel.:
(403) 237-5559, Toll-free: 1-877-460-5559, E-mail: info@pulsedatainc.com;
Please visit our website at www.pulsedatainc.com

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Pulse Seismic Inc.

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