UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

Date of report (date of earliest event reported): February 6, 2007

DAWSON GEOPHYSICAL COMPANY

(Exact name of Registrant as specified in its charter)

TEXAS		2-71058		75-0970548
(State of incorporation or organization)		(Commission file number)		(I.R.S. employer identification number)

508 W. WALL, SUITE 800 MIDLAND, TEXAS		79701
(Address of principal executive offices)		(Zip code)

Registrant’s telephone number, including area code: (432) 684-3000

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

	o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
	o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
	o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
	o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Item 2.02. Results of Operations and Financial Condition.

     On February 6, 2007, Dawson Geophysical Company (the “Company”) issued a press release reporting its operating results for the quarter ended December 31, 2006, the first quarter of its 2007 fiscal year.

     The Company hereby incorporates by reference into this Item 2.02 the information set forth in such press release, a copy of which is furnished as Exhibit 99.1 to this Current Report. Pursuant to the rules and regulations of the Securities and Exchange Commission, such exhibit and the information set forth therein and herein are deemed to be furnished and shall not be deemed to be “filed” under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

Item 9.01. Financial Statements and Exhibits.

     (d) Exhibits

     In accordance with General Instruction B.2 of Form 8-K, the information set forth in the attached Exhibit 99.1 is deemed to be “furnished” and shall not be deemed to be “filed” for purposes of the Exchange Act.

	Exhibit
	Number			Description
	99.1			Press release dated February 6, 2007.

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

INDEX TO EXHIBITS

	Exhibit
	Number			Description
	99.1			Press release dated February 6, 2007.

Exhibit 99.1

NEWS RELEASE Dawson Geophysical Company 508 W. Wall, Suite 800 Midland, TX 79701

Company contact:
L. Decker Dawson, Chairman
Stephen C. Jumper, CEO and President
Christina W. Hagan, Chief Financial Officer
(800) 332-9766
www.dawson3d.com

DAWSON GEOPHYSICAL REPORTS
RECORD FIRST QUARTER RESULTS

Company Plans to Deploy Additional
Data Acquisition Crew

MIDLAND, Texas, February 6, 2007/ PR Newswire/ — Dawson Geophysical Company (NASDAQ DWSN) today reported record revenues of $53,654,000 for the quarter ending December 31, 2006, the Company’s first quarter of fiscal 2007, compared to $35,493,000 for the same quarter in fiscal 2006, an increase of 51 percent. Revenue growth in the quarter was primarily due to the expanded capabilities of existing crews, price improvements in the markets for Dawson’s services, more favorable contract terms with Company clients, as well as the fielding of two additional seismic data acquisition crews in June and October of 2006, the Company’s 12th and 13th crews. The thirteenth crew, which was fielded on a provisional basis to work from time to time as opportunities arose, worked all of the first fiscal quarter and is continuing to operate in the second quarter.

Net income for the first quarter of fiscal 2007 was $5,435,000 compared to $2,300,000 in the same quarter of fiscal 2006, an increase of 136 percent. Earnings per share for the first quarter of fiscal 2007 were $0.72 per share compared to $0.31 in fiscal 2006.

NEWS RELEASE Dawson Geophysical Company 508 W. Wall, Suite 800 Midland, TX 79701

EBITDA for the first quarter of fiscal 2007 was $12,668,000 compared to $6,412,000 in the same quarter of fiscal 2006, an increase of 98 percent.

The Company’s first quarter results reflect continued brisk domestic exploration activities by the oil and gas industry. Despite recent changes in commodity prices, the Company’s order book remains strong and reflects commitments to maintain operations at full capacity well into calendar 2007. In response to continued industry demand for high resolution 3D surveys, the Company intends to deploy an additional seismic data acquisition crew equipped with an 8,500 channel Aram ARIES recording system in April.

Accordingly, the Company’s Board of Directors increased the previously reported fiscal 2007 capital budget by $20,000,000 to $35,100,000. The increased capital budget will be used to purchase an additional 8,500 channel Aram ARIES recording system to replace an I/O MRX recording system on an existing crew and 18 I/O vibrator energy source units increasing the fleet to 113 energy source units, and to make technical improvements in all phases of the Company’s operations. The Company has also increased the size of its credit revolver from $10,000,000 to $20,000,000. No amounts are currently borrowed under the revolver.

Stephen Jumper, President and CEO of the Company commented, “Continued exploration and development activities by our client base fueled our record first quarter results. In response to this continued demand we provisionally deployed our 13th data acquisition crew in October, plan to add an additional crew in April, and have added to our technical and operational staff in our offices in Denver, Oklahoma City and Midland as well as in our new support office in Michigan.”

NEWS RELEASE Dawson Geophysical Company 508 W. Wall, Suite 800 Midland, TX 79701

Dawson Geophysical Company is the leading provider of U.S. onshore seismic data acquisition services as measured by the number of active data acquisition crews. Founded in 1952, Dawson acquires and processes 2-D, 3-D, and multi-component seismic data solely for its clients, ranging from major oil and gas companies to independent oil and gas operators as well as providers of multi-client data libraries.

This press release contains information about the Company’s EBITDA, a non-GAAP financial measure. The Company defines EBITDA as net income plus interest expense, income taxes, depreciation and amortization expense. The Company uses EBITDA as a supplemental financial measure to assess:

	•		the financial performance of its assets without regard to financing methods, capital structures, taxes or historical cost basis;
	•		its liquidity and operating performance over time in relation to other companies that own similar assets and that the Company believes calculate EBITDA in a similar manner; and
	•		the ability of the Company’s assets to generate cash sufficient for the Company to pay potential interest costs.

     The Company also understands that such data are used by investors to assess the Company’s performance. However, the term EBITDA is not defined under generally accepted accounting principles and EBITDA is not a measure of operating income, operating performance or liquidity presented in accordance with generally accepted accounting principles. When assessing the Company’s operating performance or liquidity, investors and others should not consider this data in isolation or as a substitute for net income, cash flow from operating activities or other cash flow data calculated in accordance with generally accepted accounting principles. In addition, the Company’s EBITDA may not be comparable to EBITDA or similar titled measures utilized by other companies since such other companies may not calculate EBITDA in the same manner as the Company. Further, the results presented by EBITDA cannot be achieved without incurring the costs that the measure excludes: interest, taxes, depreciation and amortization. A reconciliation of the Company’s EBITDA to its net income is presented in the table following the text of this press release.

NEWS RELEASE Dawson Geophysical Company 508 W. Wall, Suite 800 Midland, TX 79701

In accordance with the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, Dawson Geophysical Company cautions that statements in this press release which are forward-looking and which provide other than historical information involve risks and uncertainties that may materially affect the Company’s actual results of operations. These risks include, but are not limited to, dependence upon energy industry spending, the volatility of oil and gas prices, weather interruptions, the ability to manage growth, the ability to obtain land access rights of way and the availability of capital resources. A discussion of these and other factors, including risks and uncertainties, is set forth in the Company’s Form 10-K for the fiscal year ended September 30, 2006. Dawson Geophysical Company disclaims any intention or obligation to revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

Balance Sheets

		December 31,
		2006				September 30,
		(Unaudited)				2006
ASSETS
Current assets:
Cash and cash equivalents		$	8,815,000				$ 8,064,000
Short-term investments			6,460,000				6,437,000
Accounts receivable, net of allowance for doubtful accounts of $180,000 in December 2006 and $148,000 in September 2006			45,264,000				46,074,000
Prepaid expenses			133,000				690,000
Current deferred tax assets			682,000				1,619.000
Total current assets			61,354,000				62,884,000
Property, plant and equipment			163,953,000				160,740,000
Less accumulated depreciation			(78,168,000	)			(74,206,000	)
Net property, plant and equipment			85,785,000				86,534,000
		$	147,139,000			$	149,418,000
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	7,290,000			$	16,280,000
Accrued liabilities:
Payroll costs and other taxes			869,000				1,958,000
Other			4,895,000				4,195,000
Deferred revenue			1,642,000				863,000
Total current liabilities			14,696,000				23,296,000
Deferred tax liability			7,276,000				6,914,000
Stockholders’ equity:
Preferred stock-par value $1.00 per share; 5,000,000 shares authorized, none outstanding			—				—
Common stock-par value $.33 1/3 per share; 50,000,000 shares authorized, 7,567,244 and 7,549,244 shares issued and outstanding in each period			2,523,000				2,517,000
Additional paid-in capital			82,877,000				82,370,000
Other comprehensive income, net of tax			(22,000	)			(33,000	)
Retained earnings			39,789,000				34,354,000
Total stockholders’ equity			125,167,000				119,208,000
		$	147,139,000			$	149,418,000

Statements of Operations
(UNAUDITED)		Three Months Ended December 31,
		2006				2005
Operating revenues		$	53,654,000			$	35,493,000
Operating costs:
Operating expenses			39,724,000				28,138,000
General and administrative			1,448,000				1,127,000
Depreciation			4,014,000				2,976,000
			45,186,000				32,241,000
Income from operations			8,468,000				3,252,000
Other income:
Interest income			154,000				161,000
Other			32,000				23,000
Income before income tax			8,654,000				3,436,000
Income tax expense:
Current			(1,927,000	)			(535,000	)
Deferred			(1,292,000	)			(601,000	)
Net income		$	5,435,000			$	2,300,000
Net income per common share		$	0.72			$	0.31
Net income per common share-assuming dilution		$	0.71			$	0.30
Weighted average equivalent common shares outstanding			7,553,809				7,486,389
Weighted average equivalent common shares outstanding-assuming dilution			7,635,013				7,584,165

Reconciliation of EBITDA to Net Income

		Three Months Ended December 31,
		2006				2005
		(in thousands)
Net lncome		$	5,435			$	2,300
Depreciation			4,014				2,976
Income tax (benefit) expense			3,219				1,136
EBITDA		$	12,668			$	6,412

Reconciliation of EBITDA to Net Cash Provided by Operating Activities

		Three Months Ended December 31,
		2006				2005
		(in thousands)
Net cash provided by operating activities		$	3,194			$	7,781
Changes in working capital items and other			9,761				(1,183	)
Non-cash adjustments to income			(287	)			(186	)
EBITDA		$	12,668			$	6,412