From a valuation standpoint, GeoPark is a quiet bargain hiding in plain sight. The stock trades at just 12.7 times forward adjusted earnings and 0.70 times sales, levels that sit well below sector norms. Even more telling, its price-to-sales ratio undercuts its own five-year average.From a price-action standpoint, GPRK stock has not had an easy run. The stock is down 40% from its 52-week high of $11.67, reflecting a tough year. Still, momentum is quietly turning, with shares up 10% over the past three month ...

Group 1 - GeoPark Limited (NYSE:GPRK) experienced an 11.7% decline in share price from December 3 to December 10, 2025, making it one of the worst-performing energy stocks during that week [1] - Acquisition discussions between GeoPark and Parex Resources have ceased, ending over a month of negotiations [2] - Parex Resources declined to increase its initial cash offer of $9 per share, which GeoPark believes undervalues its assets [3] Group 2 - On December 1, 2025, GeoPark announced its 2026 Work Program, aiming to triple capital expenditures (CapEx), double adjusted EBITDA, and increase production by over 60% by 2028 [4]

Core Viewpoint - GeoPark Limited has publicly commented on Parex Resources Inc.'s decision to halt discussions regarding a potential acquisition, emphasizing that the initial offer of $9.00 per share significantly undervalues the company and its recent asset enhancements [1][2][4]. Background and Engagement with Parex - On October 29, 2025, GeoPark's Board unanimously rejected Parex's unsolicited proposal to acquire the company for $9.00 per share, which was deemed to undervalue GeoPark, especially following its transformative transaction in Vaca Muerta [2][4]. - A Special Committee was formed to evaluate any potential revised offers from Parex and to explore other value-maximizing alternatives, with access granted to extensive technical and financial information [3][4]. Reserves and Growth Potential - GeoPark's 2025 reserves report indicates a 38% year-over-year increase in total 2P reserves to 121 million barrels of oil equivalent (mmboe), with reserve replacement ratios exceeding 100% [4]. - The company reported a 48% increase in 2P reserves compared to the 82 mmboe available at the time of Parex's original offer, highlighting significant growth potential [4]. - Additional risked reserves of approximately 18 mmboe are pending certification, further enhancing GeoPark's production outlook [4]. Strategic Outlook - GeoPark anticipates that Adjusted EBITDA will more than double by 2028, supported by increased cash flow and a diversified asset base [8]. - The company remains open to considering offers that appropriately value its assets, while focusing on operational strengths and financial discipline [8]. Engagement with Parex - Parex expressed interest primarily in GeoPark's Colombian assets, citing limited familiarity with unconventional resource development in Argentina, which may affect the valuation in any revised proposal [5]. - Following Parex's indication that it would not increase its offer, GeoPark's Board opened direct communication with Parex to encourage reconsideration of the original proposal [6][7].

Core Viewpoint - GeoPark Limited (NYSE:GPRK) is identified as a cheap oil stock under $10 with a consensus Moderate Buy rating from analysts, indicating potential upside from its current price [1][4]. Group 1: Production Plans and Growth - GeoPark has unveiled a 2026 Work Program targeting production of 44,000 to 46,000 barrels of oil equivalent per day (boepd) in 2026, an increase from 35,000 boepd in 2025 [2][3]. - The growth in production will be supported by drilling 72 gross wells, with 55 in Colombia and 17 in Argentina, alongside contributions from the Vaca Muerta formation [3]. - The company anticipates production to reach 45,000–47,000 boepd by 2027 and 46,000–48,000 boepd by 2028, driven by intensified unconventional activity [3]. Group 2: Analyst Ratings and Price Targets - Jefferies has reaffirmed its Buy rating on GeoPark, maintaining a price target of $10.50, which reflects confidence in the company's growth potential [4]. - The average 12-month price target for GeoPark is $9.50, suggesting a 13% upside from the current price of $8.41 [1]. Group 3: Company Overview - GeoPark is an oil and gas exploration and production company operating onshore fields across Latin America, with key assets in Colombia, Chile, Brazil, Ecuador, and Argentina [4]. - The company's strategy includes sustaining high-margin Colombian output while expanding unconventional development in Argentina's Vaca Muerta formation [2].

Core Viewpoint - Parex Resources Inc. has decided to halt discussions regarding the acquisition of GeoPark Limited due to a lack of agreement on the perceived value of GeoPark shares compared to Parex's acquisition proposal of US$9.00 per share [2][5]. Company Overview - Parex Resources Inc. is one of the largest independent oil and gas companies in Colombia, focusing on sustainable and conventional production. The company is headquartered in Calgary, Canada, with an operating office in Bogotá, Colombia, and its shares trade on the Toronto Stock Exchange under the symbol PXT [3]. Timeline of Events - On November 2, 2025, GeoPark's CEO indicated readiness to engage in discussions with Parex regarding a potential transaction [5]. - A non-disclosure agreement was executed between Parex and GeoPark from November 4 to November 13, 2025 [5]. - GeoPark provided Parex access to a virtual data room on November 14, 2025, and shared select information [5]. - On December 1, 2025, Parex and GeoPark representatives met in person in Bogotá to discuss their views on value [5]. - On December 8, 2025, GeoPark reaffirmed its unwillingness to negotiate within the parameters of Parex's September Proposal, leading Parex to halt further discussions [5].

Core Insights - GeoPark Limited announced a significant increase in its oil and gas reserves, with a 2P Reserve Replacement Ratio of 430% and a 2P Reserve Life Index of 12.7 years [1][3][11] - The company's 2P value per share, adjusted for net debt, is reported at $15.8, reflecting strong financial health [1][11] - The 2P finding, development, and acquisition cost is noted at $4.3 per barrel of oil equivalent (boe), indicating efficient capital allocation [1][6] Reserve Growth and Portfolio Optimization - Total 2P reserves increased by 38% year-over-year, primarily due to the addition of 36.7 million barrels of oil equivalent (mmboe) from Argentina [3] - The strategic acquisition of unconventional oil blocks in Vaca Muerta has transformed GeoPark's reserves profile, now accounting for 30% of total 2025 reserves [3][4] - Certified 1P reserves stand at 69 mmboe, while 2P reserves total 121 mmboe, marking the highest levels since 2022 [3][11] Operational Developments - GeoPark has implemented a strategic optimization plan for the Loma Jarillosa Este Block, currently producing 1,860 barrels of oil equivalent per day (boepd) [4] - The company is advancing its Vaca Muerta development plan with a new drilling program scheduled for the second half of 2026, aiming for a production target of 20,000 boepd by 2028 [4] Regional Performance - In Colombia, 2P reserves increased by approximately 2.6 mmboe, driven by technical revisions and new discoveries in various fields [5] - The Llanos 34 Block continues to contribute significantly to GeoPark's certified reserves through various recovery optimization initiatives [5] Financial Metrics - The net present value (NPV) of 2P reserves after tax is estimated at $1.3 billion, showcasing the company's strong asset value [11] - The 2025 Reserve Life Index for 1P, 2P, and 3P reserves are reported at 7.2 years, 12.7 years, and 18.1 years respectively, indicating a robust reserve base [11]

Financial Data and Key Metrics Changes - Adjusted EBITDA reached $71.4 million with a 57% margin, broadly stable compared to the previous quarter, supported by higher volumes and steady realized prices [7] - Net income was $15.9 million compared to a net loss in the previous quarter; excluding a non-recurrent exploration write-off, net profit would have been $23.4 million [7] - Average consolidated production was 28,136 barrels of oil equivalent per day, exceeding 2025 guidance and up nearly 3% quarter over quarter [6] Business Line Data and Key Metrics Changes - In Colombia, Llanos 34 remained a key engine with continued efficiency gains across drilling and workover operations [6] - In Llanos 123, drilling operations advanced at Toritos Norte 3, and progress was made on infrastructure in Puerto Gaitán [6] - Operating costs averaged $12.5 per barrel, fully in line with 2025 guidance, with over $15 million in efficiencies captured [7] Market Data and Key Metrics Changes - The company ended the quarter with $197 million in cash and repurchased $108 million of its 2030 notes below par, generating $9.5 million in annual cash savings [8] - Approximately 62% of expected 2026 production is protected through a hedging program with three-way collars [8] Company Strategy and Development Direction - The company successfully closed the acquisition of two high-quality blocks in Vaca Muerta, Neuquén, marking a strategic entry into a promising unconventional basin [4] - The new strategic plan focuses on sustaining a resilient and high-margin base in Colombia while rapidly scaling operations in Argentina [4] - The Board approved a revised dividend program totaling approximately $6 million over the next four quarters, reflecting a commitment to strong shareholder returns [5] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving consolidated production targets of 42,000-46,000 barrels of oil equivalent per day by 2030, with an adjusted EBITDA of $520 million-$550 million [5] - The company is preparing to scale up operations in the newly acquired blocks in Vaca Muerta, with productivity enhancements already underway [9] - Management emphasized the importance of maintaining financial discipline and maximizing shareholder value [9] Other Important Information - The company is undergoing a certification process for reserves, aiming for over 100% reserves replacement for the year [40] - The cash disbursement for the Vaca Muerta acquisition was finalized at $115 million [42] Q&A Session Summary Question: Can you provide more color on the upcoming studies and permits for the 2026 Vaca Muerta work program? - Management confirmed that operations have already begun, with production currently around 1,100 barrels of oil equivalent per day, and plans to increase to 20,000 barrels per day by the end of next year [15][17] Question: Could you comment on the lower CapEx for this quarter and provide an update on production in the Llanos Basin? - CapEx for the third quarter was around $17.5 million, reflecting a reduction due to operating with one rig; production was 28,136 barrels of oil equivalent per day, with expectations to ramp up in the fourth quarter [26][28] Question: What are the risks related to your polymer injection project in Llanos 34? - Management stated that polymer injection is a proven technology with a solid track record, and risks are managed through phased implementation and experienced personnel [64] Question: How much do you expect the Vaca Muerta acquisition will add to your 4Q 2025 production? - The acquisition is expected to contribute approximately 1,400-1,600 barrels of oil per day for the quarter [76]

Financial Performance - Revenue for the three-month period ended September 30, 2025, was $125.1 million, a decrease of 21.5% compared to $159.5 million in the same period of 2024[12] - Operating profit for the nine-month period ended September 30, 2025, was $89.9 million, down 60.7% from $229.0 million in the same period of 2024[12] - Profit for the three-month period ended September 30, 2025, was $15.9 million, a decline of 36.8% compared to $25.1 million in the same period of 2024[15] - Basic earnings per share for the three-month period ended September 30, 2025, was $0.31, down from $0.49 in the same period of 2024[12] - The Company reported a total comprehensive profit for the nine-month period ended September 30, 2025, of $24.7 million, compared to $79.5 million in the same period of 2024[15] - Profit for the nine-month period ended September 30, 2025, was $18,589,000, a decrease of 77% compared to $81,035,000 in the same period of 2024[24] - Adjusted EBITDA for the nine-month period ended September 30, 2025, was $230,851,000, down 32% from $339,202,000 in the prior year[43][44] - Adjusted EBITDA for the three-month period ended September 30, 2025, was $71,396,000, down 28.5% from $99,803,000 in the same period of 2024[47] Assets and Liabilities - Total assets as of September 30, 2025, were $1,007.1 million, a decrease from $1,200.1 million at the end of 2024[19] - Total equity attributable to owners of the Company increased to $208.6 million as of September 30, 2025, compared to $203.3 million at the end of 2024[19] - Non-current liabilities increased to $674.0 million as of September 30, 2025, from $628.1 million at the end of 2024[19] - Cash and cash equivalents decreased to $197.0 million as of September 30, 2025, from $276.8 million at the end of 2024[19] - Total revenue for the nine-month period ended September 30, 2025, was $382,224,000, a decline of 26% from $517,124,000 in the same period of 2024[43][44] - Cash and cash equivalents at the end of the period were $197,007,000, an increase from $123,440,000 at the end of September 2024[24] - The carrying amount of property, plant, and equipment decreased to US$ 652,614,000 as of September 30, 2025, from US$ 728,560,000 in 2024[71] - As of September 30, 2025, total borrowings amounted to US$ 570,368,000, an increase from US$ 514,333,000 at the end of 2024[80] Cash Flow and Expenses - Cash flows used in operating activities for the nine-month period ended September 30, 2025, were $(40,158,000), compared to $269,521,000 in 2024[24] - The company incurred financial expenses of $60.7 million for the nine-month period ended September 30, 2025, compared to $32.7 million in the same period of 2024[12] - Financial expenses increased to $16,829,000 in Q3 2025 from $10,634,000 in Q3 2024, reflecting a rise of 58.5%[47] - Financial expenses for the nine-month period ended September 30, 2025, totaled US$ 60,712,000, a 86% increase from US$ 32,656,000 in 2024[64] - The Group reported a current income tax expense of US$ 10,691,000 for the three-month period ended September 30, 2025, down 53% from US$ 23,063,000 in 2024[67] - The consolidated effective tax rate was 20% for the three-month period ended September 30, 2025, significantly lower than 46% in the same period of 2024[69] Operational Changes and Investments - The production in the Manati gas field was temporarily suspended between March 2024 and May 2025 due to maintenance activities[44] - Total production and operating costs for the nine-month period ended September 30, 2025, were $101,293,000, down 15.4% from $119,771,000 in the same period of 2024[59] - Staff costs for the three-month period ended September 30, 2025, were $3,515,000, a decrease of 12.3% from $4,010,000 in Q3 2024[59] - The company incurred investments of US$ 9,934,000 to fulfill capital commitments during the nine-month period ended September 30, 2025[92] Acquisitions and Divestments - The company completed the acquisition of 100% of Fenix Oil & Gas Limited on April 11, 2025[39] - GeoPark announced the acquisition of a 100% operated working interest in the Loma Jarillosa Este and Puesto Silva Oeste Blocks in Argentina for US$ 115,000,000, with a security deposit of US$ 22,700,000 recognized[96][98] - The divestment of working interests in Ecuador was executed for a total consideration of US$ 6,910,000, including a contingent consideration of US$ 750,000[101] - The company agreed to transfer its non-operated working interest in the Llanos 32 Block in Colombia for US$ 19,000,000, minus a working capital adjustment of US$ 3,660,000, with net proceeds already received[104] - GeoPark entered into an agreement to sell its 10% non-operated working interest in the Manati gas field in Brazil for US$ 1,000,000, plus a contingent payment of an additional US$ 1,000,000, with an advance payment of US$ 500,000 already collected[105] Market Conditions and Risks - The Brent crude oil price fell by more than 20% in early April 2025, reaching levels below US$ 60 per barrel, significantly impacting the company's market outlook[111] - Cost efficiency measures implemented from March to September 2025 included workforce reductions, incurring termination costs of US$ 6,945,000[114] - GeoPark's Board of Directors rejected an unsolicited proposal from Parex Resources Inc. to acquire the company for US$ 9.00 per share, deeming it significantly undervalued[115] - As of September 30, 2025, no additional indicators of impairment were identified, and the company will continue to monitor macroeconomic developments and oil market conditions[113] - The divestment process of the Perico and Espejo Blocks was considered an indicator of impairment as of June 30, 2025, leading to the recognition of the impairment loss[110] Financial Management - The Company declared cash dividends of US$ 0.147 per share in March, May, and August 2025, totaling approximately US$ 6,000,000 for the next four quarters, followed by a dividend suspension starting Q3 2026[78] - The Company successfully placed US$ 550,000,000 senior notes due 2030 with a coupon of 8.75% per annum, with an effective debt issuance rate of 8.98%[81] - A realized gain of US$ 6,138,000 on commodity risk management contracts was recorded during the nine-month period ended September 30, 2025[79] - The Company repurchased US$ 77,405,000 of its Notes due 2030 at an average price of US$ 0.89, recognizing US$ 7,969,000 as financial income[84] - The Group recognized a one-off non-cash charge of US$ 6,240,000 related to borrowings cancellation costs during the nine-month period ended September 30, 2025[64]

Core Insights - GeoPark reported strong operational and financial results for the third quarter of 2025, aligning with its 2025 guidance and driven by higher production, stable prices, and disciplined cost control [2][3][4] - The company successfully completed the acquisition of the Vaca Muerta operation, enhancing its growth platform in Argentina [2][7] - A quarterly cash dividend of $0.03 per share was announced, with a total expected distribution of approximately $6 million over the next four quarters [11][12] Financial Performance - In 3Q2025, GeoPark achieved Adjusted EBITDA of $71.4 million, maintaining a 57% margin, supported by increased production of 28,136 boepd compared to 27,380 boepd in 2Q2025 [4][19] - Net income for the quarter was $15.9 million, a significant recovery from a net loss of $10.3 million in 2Q2025, despite a non-recurring write-off of $7.5 million related to prior exploration costs [5][19] - Year-to-date Adjusted EBITDA reached approximately $230 million, reflecting the impact of cost discipline and efficiency initiatives [4][19] Capital Expenditures and Debt Management - Capital expenditures in 3Q2025 totaled $17.5 million, primarily focused on production maintenance and exploration activities [6][19] - The company repurchased $33 million of its 2030 Notes, resulting in annual cash coupon savings of $9.5 million, with net debt standing at $373.4 million and a low leverage ratio of 1.2x [9][19] Strategic Initiatives - GeoPark's long-term strategic plan aims to sustain a high-margin base in Colombia while scaling growth in Argentina's Vaca Muerta formation, targeting consolidated production of 42,000–46,000 boepd and Adjusted EBITDA of $520–550 million by 2030 [3][19] - A Special Committee of independent directors was established to evaluate any revised offers from Parex Resources and other value-maximizing alternatives [15][19] Operational Highlights - The company has successfully integrated the Vaca Muerta operations, initiating workover activities to enhance productivity shortly after the acquisition [7][19] - GeoPark's cash position at the end of 3Q2025 was $197 million, enabling it to fund its investment program and reduce debt [8][19]

Core Viewpoint - GeoPark Limited has rejected an unsolicited acquisition proposal from Parex Resources Inc. for $9.00 per share, indicating the Board's confidence in the company's value and future prospects [1]. Company Summary - GeoPark Limited is a leading independent energy company with over 20 years of successful operations in Latin America [1]. - The proposal from Parex Resources was received on September 4, 2025, prior to GeoPark's announcement of its transactions [1]. Board Decision - The Board of Directors of GeoPark reviewed the acquisition proposal and unanimously decided to reject it [1].