Cash EBITDA is the driver of Pulse's growth, the source of its yield, and the measure in creating its ultimate value. Cash EBITDA is EBITDA remaining after deducting participation survey revenue, and adding back any non-cash and non-recurring general and administrative expenses. (EBITDA is seismic revenue less operating, general and administrative expenses.) Cash EBITDA is what's available to invest in growing our 2D and 3D seismic data library, to repay debt, to pay dividends to shareholders and to repurchase common shares of the Company. This is why cash EBITDA is Pulse's crucial financial metric.

An important use of cash EBITDA is to drive Pulse's growth. Each year we reinvest significant amounts in growing our 2D and 3D seismic data library, as well as in repaying long-term debt (most of which has been incurred to fund the expansion of the data library). The Corporation believes cash EBITDA assists investors in comparing Pulse's results on a consistent basis without regard to participation survey revenue and non-cash items, such as depreciation and amortization, which can vary significantly depending on accounting methods or non-operating factors such as historical cost.

Participation surveys distort Pulse's financial picture because they include an immediate influx of cash from the survey participants which is classified as revenue. However, this cash is encumbered - or spoken for - because it must be used to conduct the 3D seismic survey. It is non-recurring revenue rather than cash Pulse generated through its core business of selling licensed seismic data. For these reasons, Pulse believes that the best measure of its business performance and its real value in the capital market is cash EBITDA.

Pulse has a strong record of cash EBITDA generation - even during downturns in commodity prices. Pulse's cash EBITDA is determined largely by overall seismic data library sales and its internal cost structure. Data added to the library imposes virtually no incremental operating or personnel costs. This means that as Pulse grows its data library, it increases both its revenue-generating capacity and its operating efficiencies. For example, library data sales per Pulse employee have grown in each of the past four years. Cash operating margins are strong. This supports growth in cash EBITDA.

Growth in cash EBITDA, in turn, supports Pulse's ability to continue increasing its dividend rate. Please click here to view our financial highlights or here for details of Pulse's financial performance.