January 16, 2018 / 9:19 AM / 3 months ago

Oil services group CGG issues bullish update, shares rise

* 2017 sales up 10 pct, shares surge higher in Paris

* Expects 2017 earnings to be higher than expected

* CGG emerging from debt restructuring plan

PARIS, Jan 16 (Reuters) - Oil services group CGG , which is emerging from a debt restructuring plan, on Tuesday reported higher sales in 2017 and forecast a rise in full year earnings, causing its shares to surge higher.

CGG, in which the French state holds a stake of about 9 percent, filed for bankruptcy in France and the United States last year as part of a restructuring to ease its debt burden.

It said 2017 sales had risen 10 percent from the previous year to $1.3 billion, with turnover buoyed by a general pickup in the oil market.

CGG’s Paris listed-shares, which slumped around 70 percent last year, were up 10.3 percent in early session trading.

Oil prices have been driven up by production curbs in OPEC nations and Russia, as well by strong demand thanks to healthy economic growth.

CGG predicted its 2017 core group earnings would be highter than previosuly forecast.

Analysts at French brokerage Portzamparc kept a “hold” rating on CGG shares.

Portzamparc wrote in a note that while CGG was managing its cash position and costs with “rigour”, there nevertheless remained risks that shareholders could get diluted once the company’s debt restructuring was completed. (Reporting by Sudip Kar-Gupta; editing by Richard Lough)

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