Executive Summary

Record quarter: Q4 2013 revenue of $17.2M (+118% y/y) and net income of $10.8M ($0.13 EPS) driven by monetization of SS Gairsoppa silver; cash increased to $32.0M at 12/31/13 .
Sequential inflection: revenue rose from $5.55M in Q3 to $17.24M in Q4 with EPS turning from $(0.01) to $0.13 as silver sales and hedge gains flowed through .
Strategic optionality: Oceanica monetization generated $27.5M cash in 2013 (not in GAAP P&L), with a preliminary QP assessment estimating >505M ore tonnes of phosphorite; JPMorgan advising on options .
2014 catalysts: court‑approved SS Central America recovery to begin Apr 2014; management signaled adequate 2014 funding without OMEX equity issuance and intent to repay $10M Gairsoppa project loan by Jul 24, 2014 .

What Went Well and What Went Wrong

What Went Well

Record monetization from SS Gairsoppa: “we monetized the majority of the 61 tons of silver we recovered in 2013… which drove these record top and bottom line results” – Mark Gordon, President & COO .
Technology and execution leadership: Gairsoppa operations set “a record for the deepest and heaviest precious metal cargo recovery… nearly three miles” validating techniques and state‑of‑the‑art tech .
Minerals platform validation and liquidity: $27.5M cash from Oceanica stake sales in 2013; preliminary QP assessment indicates >505M ore tonnes of high‑quality phosphorite; JPMorgan advising to maximize value .

What Went Wrong

Elevated OpEx and legal costs: Marketing, G&A rose to $14.2M in 2013 (vs. $10.6M in 2012) driven by professional fees, personnel, and $1.1M Black Swan settlement; Q4 also impacted by legal spend .
Business model volatility: Management cautions capacity to generate net income depends on successful recoveries/monetizations and minerals progress; 2014 plan requires new cash inflows with no committed new debt/equity at time of filing .
GAAP visibility constraints: $27.5M Oceanica cash proceeds (liquidity positive) are not recognized in the income statement under GAAP, limiting earnings carry‑through despite cash generation .

Financial Results

Year-over-Year (Q4 2012 → Q4 2013)

Metric	Q4 2012	Q4 2013
Revenue ($M)	7.9	17.2
Income from Operations ($M)	(1.2)	6.6
Net Income ($M)	(0.9)	10.8
Diluted EPS ($)	(0.01)	0.13
Cash and Equivalents ($M, period-end)	10.4	32.0

Sequential (Q3 2013 → Q4 2013)

Metric	Q3 2013	Q4 2013
Revenue ($M)	5.55	17.24
Net Income ($M)	(0.93)	10.75
Diluted EPS ($)	(0.01)	0.13

Actuals vs. Estimates (Q4 2013)

Metric	Actual	Consensus	Beat/(Miss)
Revenue ($M)	17.2	NA (S&P Global consensus unavailable at time of analysis)	NA
EPS ($)	0.13	NA (S&P Global consensus unavailable at time of analysis)	NA

Note: We attempted to retrieve S&P Global consensus; data was unavailable due to request limits at query time. [GetEstimates error]

KPIs and Project Economics (select)

Gairsoppa 2013 recovery: 61 tons silver recovered in 2013; total nearly 110 tons across 2012–2013; 1.8M troy oz recovered in 2013; 2013 silver sold for $35M (pre‑split with UKG, post refiner fees) .
Gairsoppa revenue recognition: $20.8M in FY2013, of which $16.7M recognized in Q4 2013; $9.2M in 2013 credited against OpEx per contract recoupment .
Silver price hedging: realized gain $1.206M on fixed‑price swaps in Q4 2013 .
Liquidity: Cash $32.0M at 12/31/2013 (vs. $10.4M at 12/31/2012), aided by Gairsoppa monetization and Oceanica stake sales .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Debt repayment (Gairsoppa project loan $10M)	By Jul 24, 2014	None disclosed	Company plans to repay before scheduled maturity	New disclosure (plan)
Funding outlook	2014	None disclosed	Adequate 2014 funding from cash, bank facilities, and operations; no need for equity financing using OMEX stock	New qualitative guidance
SS Central America operations	2014	None disclosed	Begin recovery operations in Apr 2014 with Odyssey Explorer	New project timetable
Oceanica resource update	Early 2014	None disclosed	Preliminary QP report indicates >505M ore tonnes; further info expected in Q1 2014	Resource update, no numeric financial guidance

Earnings Call Themes & Trends

Note: A Q4 2013 earnings call was announced, but we could not locate the transcript in our corpus. Thematic evolution below is synthesized from the 10‑K and press releases.

Topic	Previous Mentions (Q‑2 and Q‑1)	Current Period (Q4 2013)	Trend
Shipwreck monetization (Gairsoppa)	Minimal revenue in Q2 ($0.25M) and ramping in Q3 ($5.55M) as monetization progressed	Major monetization in Q4 ($17.24M); hedging gain of $1.21M recognized	Strong acceleration into Q4
New project pipeline (SS Central America)	Not previously active	Exclusive contract awarded; operations to begin Apr 2014	New catalyst added
Minerals (Oceanica)	Ownership disclosed Feb 2013; equity sales initiated mid‑2013	$27.5M cash from stake sales in 2013; preliminary QP resource >505M ore tonnes; JPMorgan advising	Validation and financing optionality improving
Technology/capex	Ongoing equipment investments	Installed advanced one‑pass drill on Dorado Discovery; commissioned 6,000m deep search system; Explorer upgraded in dry-dock	Capability build‑out supports pipeline
Legal/regulatory (Black Swan)	—	~$1.1M settlement fees paid; contributed to higher G&A	Legal cost headwind abating post payment
Liquidity & leverage	$10M project loan in Jul 2013	Cash $32.0M; plan to repay $10M loan by Jul 2014; no OMEX equity raise expected for 2014 plan	Balance sheet strengthened; deleveraging signaled

Management Commentary

“Our record revenue growth in 2013 and profitability in Q4 reflects our unique abilities to discover, recover and monetize valuable undersea assets.” – Mark Gordon, President & COO .
“We recovered nearly 110 tons of silver from the Gairsoppa… strong validation of our team’s pioneering techniques and state‑of‑the‑art technology.” – Mark Gordon .
“This past year was… important for the validation of our new mineral exploration business… we received $27.5 million in cash from the sale of a minority stake in our Oceanica mineral deposit.” – Greg Stemm, CEO .
On Oceanica’s resource: preliminary independent QP estimates “more than 505 million ore tonnes of high quality phosphorite.” – Management .
On near‑term catalysts: exclusive contract to recover the remaining gold cargo of SS Central America; operations planned to begin in April 2014 .
On funding: company expected “adequate funding for planned operations during 2014 with no need for equity financing using OMEX stock” .

Q&A Highlights

We could not locate a Q4 2013 earnings call transcript in our document set; the company announced a call on Mar 17, 2014, but no transcript was available to extract Q&A themes or clarifications .

Estimates Context

We attempted to retrieve S&P Global (Capital IQ) consensus for Q4 2013 revenue and EPS; data was unavailable at query time due to request limits. As a result, we cannot quantify beats/misses versus consensus for this quarter. [GetEstimates error]

Key Takeaways for Investors

Q4 was a step‑change: monetization of Gairsoppa silver turned a volatile story into a profitable quarter (EPS $0.13), demonstrating the earnings power when high‑value recoveries convert to cash .
Liquidity materially improved (cash $32.0M), aided by Gairsoppa and Oceanica stake sales; management plans to repay the $10M project loan by July 2014, reducing financing risk .
Minerals optionality is real: a preliminary QP resource (>505M ore tonnes) plus JPMorgan’s advisory role position Oceanica for strategic alternatives, though GAAP won’t recognize such cash proceeds in earnings until events occur .
2014 catalysts include SS Central America recoveries and further Oceanica updates; execution on these will likely drive stock narrative and valuation .
Costs remain a watch item: legal and higher G&A compressed full‑year results; sustaining lower run‑rate overhead and disciplined hedging (as in Q4) would support future profitability .
Business remains event‑driven and lumpy; investors should expect quarter‑to‑quarter volatility tied to timing of recoveries, monetizations, and permitting milestones .

Sources: Q4 2013 8‑K press release and exhibits ; FY2013 10‑K (quarterly data, project details, liquidity, hedging, Oceanica) ; Jan 6, 2014 8‑K press release (cash update, funding, project plans) .

ODYSSEY MARINE EXPLORATION INC (OMEX)·Q4 2013 Earnings Summary