GeoPark Reports Third Quarter 2022 Results
Growing Production and Free Cash Flow Funds Deleveraging & Accelerated Shareholder Returns
BOGOTA, Colombia–(BUSINESS WIRE)–GeoPark Limited (“GeoPark” or the “Company”) (NYSE: GPRK), a leading independent Latin American oil and gas explorer, operator and consolidator reports its consolidated financial results for the three-month period ended September 30, 2022 (“Third Quarter” or “3Q2022”). A conference call to discuss 3Q2022 financial results and the 2023 work program and shareholder return framework will be held on November 10, 2022 at 10:00 am (Eastern Daylight Time).
All figures are expressed in US Dollars and growth comparisons refer to the same period of the prior year, except when specified. Definitions and terms used herein are provided in the Glossary at the end of this document. This release does not contain all of the Company’s financial information and should be read in conjunction with GeoPark’s consolidated financial statements and the notes to those statements for the period ended September 30, 2022, available on the Company’s website.
THIRD QUARTER 2022 HIGHLIGHTS
Accelerating Production Growth
- Consolidated oil and gas production up 8% to 38,396 boepd1
- 13 rigs operating in November 2022 (compared to 8 rigs in November 2021)
- On track to reach 2022 full-year guidance of 38,500-40,500 boepd
Growing Revenue, Adjusted EBITDA & Cash Flow Driving Record Net Profit
- Revenue up 48% to $258.2 million
- Adjusted EBITDA up 63% to $141.3 million (including $13.8 million of realized cash hedge losses)
- Operating Profit up 79% to $145.4 million
- Cash flow from operations up 183% to $141.1 million
- Record Net Profit of $73.4 million (or $1.24 earnings per share)
- 2022 full-year capital expenditures program of $200-220 million, generating free cash of $250-280 million2 assuming $90-100 per bbl Brent3, equivalent to a 33-37% free cash flow yield4
- Capital expenditures of $43.4 million
- Every dollar invested in capital expenditures yielded 3.2x in Adjusted EBITDA
Returning More Value To Shareholders
- Quarterly Dividend of $0.127 per share, or $7.5 million, payable on December 7, 2022
- Equivalent to an annualized dividend of approximately $30 million (or $0.508 per share), a 4% dividend yield5
- Completed share buyback program after acquiring 2.2 million shares (or over 3% of total shares outstanding) for $29.3 million since November 2021
- Renewed discretionary share buyback program for up to 10% of shares outstanding until December 2023
Deleveraging and Balance Sheet Strengthening
- Fully redeemed the remaining $67.1 million principal of the 2024 Notes in September 2022
- Reduced gross debt by $170 million since January 1, 2022, or $275 million since April 2021
- Net leverage of 0.8x
- Cash in hand of $93.0 million
2023 Work Program: Strong Cash Generation with Increased Shareholder Returns
- 2023 production guidance of 39,500-41,500 boepd (assuming no production from the exploration drilling program)
- Self-funded 2023 capital expenditures program of $200-220 million to drill 50-55 gross wells
- At $80-90 per bbl Brent, GeoPark expects to generate an Adjusted EBITDA of $510-580 million and targeting to return approximately 40-50% of free cash flows after taxes6 to shareholders
Recent Events And Upcoming Catalysts
- Indico 6 development well, completed in October 2022 is currently producing 4,100 bopd (on a restricted 32/64 inch choke), of 35 degrees API with 0.1% water cut
- Drilling 15-18 gross wells in 4Q2022, targeting development, appraisal, and exploration projects in the Llanos and Putumayo basins in Colombia and in the Oriente basin in Ecuador
- Exploration drilling includes 3-4 wells in new blocks in the Llanos basin, 1 well in the Putumayo basin and 1 well in the Oriente basin in Ecuador
Andrés Ocampo, Chief Executive Officer of GeoPark, said: “The third quarter financial results reflect the hard work of GeoPark’s most important asset, our people. Once again, in 2022, that hard work has paid off with a busy drilling schedule that produced record financial results from the top line to the bottom line. We have just completed our 2023 capital allocation process and anticipate another active year drilling between 50-55 wells across our portfolio. This will translate into significant free cash flow in 2023 to self-fund our high-impact exploration and development program and increase shareholder returns while maintaining a strong balance sheet, reducing emissions and strengthening the ties to our neighbors.”
CONSOLIDATED OPERATING PERFORMANCE
Key performance indicators:
| Key Indicators | 3Q2022 | 2Q2022 | 3Q2021 | 9M2022 | 9M2021 | |||||
| Oil productiona (bopd) | 34,875 | 35,238 | 32,844 | 34,886 | 32,228 | |||||
| Gas production (mcfpd) | 21,126 | 22,212 | 30,090 | 22,799 | 31,587 | |||||
| Average net production (boepd) | 38,396 | 38,940 | 37,859 | 38,686 | 37,492 | |||||
| Brent oil price ($ per bbl) | 98.2 | 111.5 | 73.2 | 101.9 | 67.7 | |||||
| Combined realized price ($ per boe) | 77.5 | 90.0 | 53.9 | 81.2 | 49.7 | |||||
| – Oil ($ per bbl) | 85.9 | 98.7 | 60.3 | 89.7 | 55.7 | |||||
| – Gas ($ per mcf) | 4.5 | 5.1 | 4.2 | 4.8 | 4.0 | |||||
| Sale of crude oil ($ million) | 248.7 | 296.4 | 163.5 | 784.1 | 454.6 | |||||
| Sale of purchased crude oil ($ million) | 1.0 | 5.4 | – | 6.3 | – | |||||
| Sale of gas ($ million) | 8.6 | 9.4 | 10.5 | 28.2 | 31.5 | |||||
| Revenue ($ million) | 258.2 | 311.2 | 174.0 | 818.6 | 486.2 | |||||
| Commodity risk management contracts b ($ million) | 23.0 | (15.5) | (11.7) | (70.7) | (106.7) | |||||
| Production & operating costsc ($ million) | (87.1) | (115.1) | (49.2) | (282.8) | (145.2) | |||||
| G&G, G&Ad ($ million) | (16.7) | (13.8) | (13.9) | (43.2) | (43.0) | |||||
| Selling expenses ($ million) | (2.0) | (1.2) | (1.8) | (5.2) | (5.3) | |||||
| Adjusted EBITDA ($ million) | 141.3 | 144.8 | 86.8 | 408.7 | 213.7 | |||||
| Adjusted EBITDA ($ per boe) | 42.4 | 41.9 | 26.9 | 40.6 | 21.9 | |||||
| Operating Netback ($ per boe) | 46.4 | 45.4 | 30.8 | 44.3 | 25.9 | |||||
| Net Profit (loss) ($ million) | 73.4 | 67.9 | 37.0 | 172.2 | 24.2 | |||||
| Capital expenditures ($ million) | 43.4 | 32.4 | 30.6 | 115.2 | 85.4 | |||||
| Cash and cash equivalents ($ million) | 93.0 | 122.5 | 76.8 | 93.0 | 76.8 | |||||
| Short-term financial debt ($ million) | 6.8 | 15.3 | 18.1 | 6.8 | 18.1 | |||||
| Long-term financial debt ($ million) | 484.3 | 570.0 | 656.8 | 484.3 | 656.8 | |||||
| Net debt ($ million) | 398.1 | 462.9 | 598.1 | 398.1 | 598.1 |
| a) | Includes royalties paid in kind in Colombia for approximately 911, 1,273, and 1,213 bopd in 3Q2022, 2Q2022 and 3Q2021, respectively. No royalties were paid in kind in other countries. Production in Ecuador is reported before the Government’s production share. | |
| b) | Please refer to the Commodity Risk Management section included below. | |
| c) | Production and operating costs include operating costs, royalties and economic rights paid in cash, share based payments and purchased crude oil. | |
| d) | G&A and G&G expenses include non-cash, share-based payments for $3.9, $2.0 million and $1.7 million in 3Q2022, 2Q2022 and 3Q2021, respectively. These expenses are excluded from the Adjusted EBITDA calculation. |
RECENT BLOCKADES IN THE LLANOS BASIN IN COLOMBIA
In mid-October 2022, localized blockades in the Llanos basin partially affected production and operations in the Llanos 34 block (GeoPark operated, 45% WI), that is expected to reduce net production by approximately 230 bopd in 4Q2022. Blockades have been lifted as of the date of this release and production and operations have been normalized.
Production: Oil and gas production in 3Q2022 was 38,396 boepd. Adjusting for divestments in Argentina (completed on January 31, 2022), consolidated oil and gas production increased by 8% compared to 3Q2021, due to higher production in Colombia, Chile and Ecuador, partially offset by lower production in Brazil. Oil represented 91% and 87% of total reported production in 3Q2022 and 3Q2021, respectively.
Compared to 2Q2022, oil and gas production was 1% lower, mainly due to temporary local blockades in Colombia that reduced 3Q2022 production by approximately 1,100-1,200 boepd, and to a lesser extent, lower gas production in Brazil.
For further details, please refer to the 3Q2022 Operational Update published on October 20, 2022.
Reference and Realized Oil Prices: Brent crude oil prices averaged $98.2 per bbl during 3Q2022, and the consolidated realized oil sales price averaged $85.9 per bbl in 3Q2022.
A breakdown of reference and net realized oil prices in relevant countries in 3Q2022 and 3Q2021 is shown in the tables below:
| 3Q2022 – Realized Oil Prices ($ per bbl) | Colombia | Chile | Argentina7 | Ecuador | ||||||
| Brent oil price (*) | 98.2 | 98.2 | – | 98.2 | ||||||
| Local marker differential | (3.8) | – | – | – | ||||||
| Commercial, transportation discounts & Other | (8.7) | (4.8) | – | (5.2) | ||||||
| Realized oil price | 85.7 | 93.4 | – | 93.0 | ||||||
| Weight on oil sales mix | 98% | 1% | – | 1% | ||||||
| 3Q2021 – Realized Oil Prices ($ per bbl) | Colombia | Chile | Argentina | Ecuador | ||||||
| Brent oil price (*) | 73.2 | 73.2 | 73.2 | – | ||||||
| Local marker differential | (4.1) | – | – | – | ||||||
| Commercial, transportation discounts & Other | (8.8) | (9.2) | (16.1) | – | ||||||
| Realized oil price | 60.3 | 64.0 | 57.1 | – | ||||||
| Weight on oil sales mix | 96% | 1% | 3% | – |
(*) Corresponds to average month of sale price ICE Brent for Colombia, Ecuador and Argentina, and Dated Brent for Chile.
Revenue: Consolidated revenue increased by 48% to $258.2 million in 3Q2022, compared to $174.0 million in 3Q2021, reflecting higher oil and gas prices and higher deliveries.
Sales of crude oil: Consolidated oil revenue increased by 52% to $248.7 million in 3Q2022, driven by a 42% increase in realized oil prices and 6% higher oil deliveries. Oil revenue was 96% of total revenue in 3Q2022 and 94% in 3Q2021.
| (In millions of $) | 3Q2022 | 3Q2021 | |||||
| Colombia | 243.6 | 156.1 | |||||
| Chile | 3.0 | 1.5 | |||||
| Argentina | – | 5.7 | |||||
| Brazil | 0.2 | 0.2 | |||||
| Ecuador | 1.9 | – | |||||
| Oil Revenue | 248.7 | 163.5 |
- Colombia: 3Q2022 oil revenue increased by 56% to $243.6 million, reflecting higher realized oil prices and higher oil deliveries. Realized prices increased by 42% to $85.7 per bbl due to higher Brent oil prices while oil deliveries increased by 10% to 32,071 bopd. Earn-out payments increased to $9.3 million in 3Q2022, compared to $6.0 million in 3Q2021 in line with higher oil prices.
- Chile: 3Q2022 oil revenue increased by 96% to $3.0 million, reflecting higher realized prices and higher oil deliveries. Realized prices increased by 46% to $93.4 per bbl due to higher Brent oil prices while oil deliveries increased by 34% to 345 bopd.
- Ecuador: 3Q2022 oil revenue totaled $1.9 million, reflecting a realized oil price of $93.0 with deliveries of 227 bopd. Deliveries recorded in Ecuador are net of the Government’s production share.
Sales of purchased crude oil: 3Q2022 sales of purchased crude oil totaled $1.0 million, which corresponds to oil trading operations (purchasing and selling crude oil from third parties with the cost of the oil purchased being reflected in production and operating costs).
Sales of gas: Consolidated gas revenue decreased by 18% to $8.6 million in 3Q2022 compared to $10.5 million in 3Q2021 reflecting 24% lower gas deliveries, partially offset by 9% higher gas prices. Gas revenue was 3% and 6% of total revenue in 3Q2022 and 3Q2021, respectively.
| (In millions of $) | 3Q2022 | 3Q2021 | |||||
| Chile | 4.2 | 4.1 | |||||
| Brazil | 4.3 | 4.6 | |||||
| Argentina | – | 1.3 | |||||
| Colombia | 0.1 | 0.5 | |||||
| Gas Revenue | 8.6 | 10.5 |
- Chile: 3Q2022 gas revenue increased by 3% to $4.2 million, reflecting higher gas prices, partially offset by lower gas deliveries. Gas prices were 5% higher, at $3.9 per mcf ($23.1 per boe) in 3Q2022. Gas deliveries fell by 2% to 11,753 mcfpd (1,959 boepd).
- Brazil: 3Q2022 gas revenue decreased by 7% to $4.3 million, due to lower gas deliveries, partially offset by higher gas prices. Gas deliveries decreased by 11% from the Manati gas field to 8,630 mcfpd (1,438 boepd). Gas prices increased by 5% to $5.4 per mcf ($32.5 per boe) in 3Q2022.
Commodity Risk Management Contracts: Consolidated commodity risk management contracts amounted to a $23.0 million gain in 3Q2022, compared to a $11.7 million loss in 3Q2021.
The table below provides a breakdown of realized and unrealized commodity risk management contracts in 3Q2022 and 3Q2021:
| (In millions of $) | 3Q2022 | 3Q2021 | |||
| Realized loss | (13.8) | (22.4) | |||
| Unrealized loss | 36.8 | 10.6 | |||
| Commodity risk management contracts | 23.0 | (11.7) |
The realized portion registered a loss of $13.8 million in 3Q2022 compared to a $22.4 million loss in 3Q2021. Realized losses in 3Q2022 reflected hedges with average ceiling prices below actual Brent oil prices during the quarter.
The unrealized portion registered a gain of $36.8 million in 3Q2022, compared to a $10.6 million gain in 3Q2021. Unrealized gains in 3Q2022 mainly resulted from reclassifications to realized losses, combined with movements in the forward Brent oil price curve at September 30, 2022, compared to June 30, 2022.
Please refer to the “Commodity Risk Oil Management Contracts” section below for a description of hedges in place as of the date of this release.
Production and Operating Costs8: Consolidated production and operating costs increased to $87.1 million from $49.2 million, mainly resulting from a $31.6 million increase in royalties and economic rights, due to higher oil and gas prices.
The table below provides a breakdown of production and operating costs in 3Q2022 and 3Q2021:
| (In millions of $) | 3Q2022 | 3Q2021 | |||
| Royalties | (15.5) | (10.9) | |||
| Economic rights | (47.0) | (20.0) | |||
| Operating costs | (23.6) | (18.2) | |||
| Purchased crude oil | (0.7) | – | |||
| Share-based payments | (0.3) | (0.1) | |||
| Production and operating costs | (87.1) | (49.2) |
Consolidated royalties amounted to $15.5 million in 3Q2022 compared to $10.9 million in 3Q2021, in line with higher oil prices.
Consolidated economic rights (including high price participation, x-factor and other economic rights paid to the Government) amounted to $47.0 million in 3Q2022 compared to $20.0 million in 3Q2021, in line with higher oil prices.
Consolidated operating costs increased to $23.6 million in 3Q2022 compared to $18.2 million in 3Q2021, mainly resulting from higher deliveries and higher operating costs per boe in Colombia, Chile and Brazil, and the addition of operating costs coming from Ecuador, partially offset by the divestment of the Aguada Baguales, Puesto Touquet and El Porvenir blocks in Argentina (completed in January 2022).
The breakdown of operating costs is as follows:
- Colombia: Total operating costs increased to $19.4 million in 3Q2022 from $11.9 million in 3Q2021, mainly due to due to higher operating costs per boe resulting from increased activity levels and higher deliveries (deliveries in Colombia increased by 9%). However, compared to 2Q2022, total operating costs decreased by 9%.
- Chile: Total operating costs increased to $2.6 million in 3Q2022 from $2.2 million in 3Q2021, in line with higher operating costs per boe and higher oil and gas deliveries (deliveries in Chile increased by 2%).
- Brazil: Total operating costs remained flat at $0.8 million in 3Q2022 compared to $0.8 million in 3Q2021, due to lower gas deliveries in the Manati field (deliveries in Brazil decreased by 11%), offset by higher operating costs per boe.
- Ecuador: Total operating costs were $0.6 million in 3Q2022.
- Argentina: The divestment of the Aguada Baguales, El Porvenir and Puesto Touquet blocks was completed in January 2022. The comparative period, 3Q2021, included $3.3 million in operating costs.
Consolidated purchased crude oil charges amounted to $0.7 million in 3Q2022, which corresponds to oil trading operations (purchasing and selling crude oil from third parties with the sale of purchased oil being reflected in revenue).
Selling Expenses: Consolidated selling expenses increased to $2.0 million in 3Q2022 compared to $1.8 million in 3Q2021.
Geological & Geophysical Expenses: Consolidated G&G expenses increased to $2.3 million in 3Q2022 compared to $2.1 million in 3Q2021.
Administrative Expenses: Consolidated G&A increased to $14.3 million in 3Q2022 compared to $11.8 million in 3Q2021.
Adjusted EBITDA: Consolidated Adjusted EBITDA9 increased by 63% to $141.3 million, or $42.4 per boe, in 3Q2022 compared to $86.8 million, or $26.9 per boe, in 3Q2021.
| (In millions of $) | 3Q2022 | 3Q2021 | |||||
| Colombia | 139.1 | 83.1 | |||||
| Chile | 3.6 | 2.7 | |||||
| Brazil | 2.5 | 2.9 | |||||
| Argentina | (1.6) | 2.2 | |||||
| Ecuador | 0.7 | (0.4) | |||||
| Corporate | (3.0) | (3.7) | |||||
| Adjusted EBITDA | 141.3 | 86.8 |
The table below shows production, volumes sold and the breakdown of the most significant components of Adjusted EBITDA for 3Q2022 and 3Q2021, on a per boe basis:
| Adjusted EBITDA/boe | Colombia | Chile | Brazil | Ecuador | Totald | |||||||||||||||
|
| 3Q22 |
| 3Q21 |
| 3Q22 |
| 3Q21 |
| 3Q22 |
| 3Q21 |
| 3Q22 |
| 3Q21 |
| 3Q22 |
| 3Q21 | |
| Production (boepd) | 33,338 |
| 31,565 |
| 2,425 |
| 2,354 |
| 1,439 |
| 1,791 |
| 1,194 |
| – |
| 38,396 |
| 37,859 | |
| Inventories, RIKa & Other | (1,212) |
| (2,102) |
| (121) |
| (91) |
| 19 |
| (147) |
| (967) |
| – |
| (2,175) |
| (2,746) | |
| Sales volume (boepd) | 32,126 |
| 29,463 |
| 2,304 |
| 2,263 |
| 1,458 |
| 1,644 |
| 227 |
| – |
| 36,221 |
| 35,113 | |
| % Oil | 99.8% |
| 99.3% |
| 15% |
| 11% |
| 1% |
| 1% |
| 100% |
| – |
| 90% |
| 87% | |
| ($ per boe) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Realized oil price | 85.7 |
| 60.3 |
| 93.4 |
| 64.0 |
| 100.1 |
| 71.2 |
| 93.0 |
| – |
| 85.9 |
| 60.3 | |
| Realized gas pricec | 27.1 |
| 27.0 |
| 23.1 |
| 22.0 |
| 32.5 |
| 31.1 |
| – |
| – |
| 27.1 |
| 25.0 | |
| Earn-out | (3.2) |
| (2.2) |
| – |
| – |
| – |
| – |
| – |
| – |
| (2.8) |
| (1.9) | |
| Combined Price | 82.5 |
| 57.8 |
| 33.7 |
| 26.8 |
| 33.4 |
| 31.6 |
| 93.0 |
| – |
| 77.5 |
| 53.8 | |
| Realized commodity risk management contracts | (4.7) |
| (8.2) |
| – |
| – |
| – |
| – |
| – |
| – |
| (4.2) |
| (6.9) | |
| Operating costse | (6.7) |
| (5.3) |
| (12.4) |
| (10.6) |
| (8.7) |
| (7.6) |
| (30.7) |
| – |
| (7.3) |
| (6.5) | |
| Royalties & economic rights | (21.0) |
| (10.5) |
| (1.3) |
| (0.9) |
| (2.6) |
| (2.7) |
| 0.0 |
| – |
| (18.8) |
| (9.3) | |
| Purchased crude oilb | – |
| – |
| – |
| – |
| – |
| – |
| – |
| – |
| (0.3) |
| – | |
| Selling & other expenses | (0.5) |
| (0.1) |
| (0.4) |
| (0.4) |
| (0.0) |
| (0.0) |
| (19.6) |
| – |
| (0.6) |
| (0.2) | |
| Operating Netback/boe | 49.6 |
| 33.6 |
| 19.6 |
| 14.8 |
| 22.1 |
| 21.4 |
| 42.7 |
| – |
| 46.4 |
| 30.8 | |
| G&A, G&G & other |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (4.0) |
| (4.0) | |
| Adjusted EBITDA/boe |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 42.4 |
| 26.9 | |
| a) | RIK (Royalties in kind). Includes royalties paid in kind in Colombia for approximately 911 bopd and 1,213 bopd in 3Q2022 and 3Q2021, respectively. No royalties were paid in kind in Chile, Brazil, Argentina or Ecuador. Production in Ecuador is reported before the Government’s production share. | |
| b) | Reported in the Corporate business segment. | |
| c) | Conversion rate of $mcf/$boe=1/6. | |
| d) | Includes amounts recorded in the Corporate and Argentina segments. | |
| e) | Operating costs per boe included in this table include certain adjustments to the reported figures (IFRS 16 and other). |
Depreciation: Consolidated depreciation charges decreased by 9% to $21.4 million in 3Q2022 compared to $23.6 million in 3Q2021, mainly resulting from the divestment of the Aguada Baguales, El Porvenir and Puesto Touquet blocks in Argentina, with higher depreciation costs per boe.
Write-off of unsuccessful exploration efforts: The consolidated write-off of unsuccessful exploration efforts amounted to $5.9 million in 3Q2022 compared to $4.2 million in 3Q2021. Amounts recorded in 3Q2022 correspond to exploration costs incurred in previous years in the Tacacho and Terecay blocks (Putumayo basin in Colombia) and an exploratory well drilled in the CPO-5 Block (Llanos basin in Colombia).
Other Income (Expenses): Other operating expenses showed a $2.6 million loss in 3Q2022, compared to a $1.6 million loss in 3Q2021.
CONSOLIDATED NON-OPERATING RESULTS AND PROFIT FOR THE PERIOD
Financial Expenses: Net financial expenses remained flat at $13.3 million in 3Q2022 and 3Q2021, mainly resulting from borrowing cancellation costs of $2.1 million recorded in 3Q2022 associated with gross debt reductions during the quarter, offset by lower interest costs resulting from a sustained deleveraging process that started in April 2021 and continued in 2022.
Foreign Exchange: Net foreign exchange gains amounted to $11.5 million in 3Q2022 compared to $1.0 million in 3Q2021. Gains recorded in 3Q2022 mainly resulted from the devaluation of the Colombian peso and its effect on liabilities in local currency.
Income Tax: Income taxes totaled $70.2 million in 3Q2022 compared to $31.9 million in 3Q2021, mainly resulting from higher profits before income taxes and the effect of fluctuations of the Colombian peso over deferred income taxes.
Net Profit: Profit increased by 98% to a $73.4 million gain in 3Q2022 compared to a $37.0 million gain in 3Q2021.
BALANCE SHEET
Cash and Cash Equivalents: Cash and cash equivalents totaled $93.0 million as of September 30, 2022, compared to $100.6 million as of December 31, 2021.
This net decrease is explained by the following:
| (In millions of $) | 9M2022 | ||
| Cash flows from operating activities | 354.1 | ||
| Cash flows used in investing activities | (100.1) | ||
| Cash flows used in financing activities | (262.4) | ||
| Currency Translation | 0.8 | ||
| Net decrease in cash & cash equivalents | (7.6) |
Cash flows used in investing activities included $115.2 million in capital expenditures incurred by the Company as part of its 2022 work program, partially offset by proceeds from the disposal of assets that amounted to $15.1 million.
Cash flows used in financing activities mainly included $180.4 million related to repurchases and redemptions of the 2024 Notes (including borrowing cancellation costs and other costs paid), $36.5 million related to interest payments, $23.1 million related to executing the Company’s share buyback program and $17.0 million related to dividend payments.
Financial Debt: Total financial debt net of issuance cost was $491.1 million, including the 2027 Notes and other bank loans for $1.2 million. Short-term financial debt was $6.8 million as of September 30, 2022.
| (In millions of $) | September 30, 2022 | December 31, 2021 | ||
| 2024 Notes | – | 171.9 | ||
| 2027 Notes | 489.9 | 499.9 | ||
| Other bank loans | 1.2 | 2.3 | ||
| Financial debt | 491.1 | 674.1 |
During 9M2022, the Company significantly reduced its gross debt through repurchases and the redemption of its 2024 Notes.
For further details, please refer to Note 12 of GeoPark’s consolidated financial statements as of September 30, 2022, available on the Company’s website.
FINANCIAL RATIOSa
| (In millions of $) | ||||||||||
| Period-end | Financial | Cash and Cash | Net Debt | Net Debt/LTM | LTM Interest | |||||
| 3Q2021 | 674.9 | 76.8 | 598.1 | 2.2x | 5.8x | |||||
| 4Q2021 | 674.1 | 100.6 | 573.5 | 1.9x | 6.7x | |||||
| 1Q2022 | 642.5 | 114.1 | 528.4 | 1.5x | 8.4x | |||||
| 2Q2022 | 585.4 | 122.5 | 462.9 | 1.0x | 10.8x | |||||
| 3Q2022 | 491.1 | 93.0 | 398.1 | 0.8x | 12.7x | |||||
| a) | Based on trailing last twelve-month financial results (“LTM”). |
Covenants in the 2027 Notes: The 2027 Notes include incurrence test covenants that provide, among other things, that the Net Debt to Adjusted EBITDA ratio should not exceed 3.25 times and the Adjusted EBITDA to Interest ratio should exceed 2.5 times.
For further details, please refer to Note 12 of GeoPark’s consolidated financial statements as of September 30, 2022, available on the Company’s website.
COMMODITY RISK OIL MANAGEMENT CONTRACTS
The table below summarizes commodity risk management contracts in place as of the date of this release:
| Period | Type | Reference | Volume | Contract Terms (Average $ per bbl) | ||||||
|
|
|
|
| Purchased Put | Sold Call | |||||
| 4Q2022 | Zero cost collar | Brent | 12,000 | 60.6 | 92.6 | |||||
| 1Q2023 | Zero cost collar | Brent | 9,500 | 66.0 | 112.6 | |||||
| 2Q2023 | Zero cost collar | Brent | 8,500 | 69.1 | 113.1 | |||||
| 3Q2023 | Zero cost collar | Brent | 2,000 | 70.0 | 101.1 | |||||
For further details, please refer to Note 4 of GeoPark’s consolidated financial statements for the period ended September 30, 2022, available on the Company’s website.
SELECTED INFORMATION BY BUSINESS SEGMENT
|
|
|
|
|
|
|
| ||
| Colombia (In millions of $) | 3Q2022 |
|
|
| 3Q2021 | |||
| Sale of crude oil | 243.6 |
|
|
| 156.1 | |||
| Sale of gas | 0.1 |
|
|
| 0.5 | |||
| Revenue | 243.7 |
|
|
| 156.7 | |||
| Production and operating costsa | (81.6) |
|
|
| (41.2) | |||
| Adjusted EBITDA | 139.1 |
|
|
| 83.1 | |||
| Capital expenditure | 36.7 |
|
|
| 30.4 | |||
| Chile (In millions of $) | 3Q2022 |
|
|
| 3Q2021 | |||
| Sale of crude oil | 3.0 |
|
|
| 1.5 | |||
| Sale of gas | 4.2 |
|
|
| 4.1 | |||
| Revenue | 7.1 |
|
|
| 5.6 | |||
| Production and operating costsa | (2.9) |
|
|
| (2.4) | |||
| Adjusted EBITDA | 3.6 |
|
|
| 2.7 | |||
| Capital expenditure | 0.2 |
|
|
| 0.1 | |||
| Brazil (In millions of $) | 3Q2022 |
|
|
| 3Q2021 | |||
| Sale of crude oil | 0.2 |
|
|
| 0.2 | |||
| Sale of gas | 4.3 |
|
|
| 4.6 | |||
| Revenue | 4.5 |
|
|
| 4.8 | |||
| Production and operating costsa | (1.2) |
|
|
| (1.2) | |||
| Adjusted EBITDA | 2.5 |
|
|
| 2.9 | |||
| Capital expenditure | 0.0 |
|
|
| 0.0 | |||
| Ecuador (In millions of $) | 3Q2022 |
|
|
| 3Q2021 | |||
| Sale of crude oil | 1.9 |
|
|
| – | |||
| Sale of gas | 0.0 |
|
|
| – | |||
| Revenue | 1.9 |
|
|
| – | |||
| Production and operating costsa | (0.6) |
|
|
| – | |||
| Adjusted EBITDA | 0.7 |
|
|
| (0.4) | |||
| Capital expenditure | 6.4 |
|
|
| 0.2 |
Contacts
INVESTORS:
Stacy Steimel
[email protected]
Shareholder Value Director
T: +562 2242 9600
Miguel Bello
[email protected]
Market Access Director
T: +562 2242 9600
Diego Gully
[email protected]
Investor Relations Director
T: +55 21 99636 9658
MEDIA:
Communications Department
[email protected]
