Gran Tierra Energy(GTE) - 2024 Q3 - Quarterly Results

Financial Performance - Gran Tierra achieved $1 million in net income and generated $60 million in funds flow from operations, an increase of 31% from the prior quarter[1]. - Gran Tierra's net income for the quarter was $1.13 million, down from $6.53 million in the prior quarter[18]. - Net income for the three months ended September 30, 2024, was $1,133, compared to $6,527 for the same period in 2023, indicating a decline of approximately 83.7%[26]. - EBITDA for the three months ended September 30, 2024, was $97.365 million, down 15.6% from $115.382 million in the same period of 2023[28]. - Adjusted EBITDA for the quarter was $93 million, compared to $103 million in the prior quarter[14]. - Adjusted EBITDA for the three months ended September 30, 2024, was $92.794 million, a decrease of 22.2% from $119.235 million in the same period of 2023[28]. - Gran Tierra generated oil sales of $151 million, down 16% from Q3 2023, primarily due to weaker Brent pricing and 4% lower sales volumes[16]. - Free cash flow for the three months ended September 30, 2024, was $7.417 million, down 79.3% from $35.920 million in the same period of 2023[29]. - The company reported free cash flow of $7,417, a significant decrease from $35,920 in the prior quarter[18]. - Cash netback for the three months ended September 30, 2024, was $60,338, down from $79,000 in the same period of 2023, representing a decrease of approximately 23.6%[27]. - Cash netback per bbl was $20.34, an increase from $15.85 in the prior quarter, but a decrease from $25.48 a year ago[17]. - Gran Tierra's return on average capital employed was 17% during the quarter and 16% over the trailing 12 months[15]. - Gran Tierra's return on average capital employed for the three months ended September 30, 2024, was 17%, compared to 16% for the previous period[26]. Production and Operations - Total average working interest production for Q3 2024 was 32,764 BOPD, consistent with the prior quarter[13]. - The company successfully drilled its sixth consecutive oil discovery in Ecuador, achieving cumulative production of over 1 million barrels of oil[8]. - The acquisition of i3 Energy added 253 net booked drilling locations and increased Gran Tierra's PDP reserves by 42 million bbls of oil equivalent, a 96% increase[2]. - The company plans to drill 19 gross wells in Q4 2024, targeting core operating areas in Canada[5]. - Acordionero water treatment facilities expansion is expected to increase water handling capacity by 21,500 bbls per day, a 35% increase[12]. Expenses and Liabilities - Capital expenditures for the quarter were $53 million, lower than the $61 million in the prior quarter but up from $43 million in Q3 2023[15]. - Operating expenses decreased by 2% to $46 million compared to the prior quarter, and by 7% from Q3 2023, mainly due to lower lifting costs[16]. - Transportation expenses decreased by 31% to $4 million compared to the prior quarter, but increased by 2% from Q3 2023[16]. - General and administrative expenses before stock-based compensation were $3.20 per bbl, down from $3.77 in the prior quarter[16]. - Interest expense for the three months ended September 30, 2024, was $19.892 million, an increase of 47.9% compared to $13.503 million in the same period of 2023[28]. - DD&A expenses for the three months ended September 30, 2024, were $55.573 million, slightly up from $55.019 million in the same period of 2023[28]. - Gran Tierra exited the quarter with $278 million in cash and total debt of $787 million, resulting in net debt of $509 million[14]. - Net debt as of September 30, 2024, was $509 million, calculated from total debt of $787 million minus cash and cash equivalents of $278 million[30]. Future Outlook and Risks - Gran Tierra continues to pursue additional growth opportunities to strengthen its portfolio in Canada, Colombia, and Ecuador[21]. - The company plans to continue its drilling program and capital expenditures while monitoring commodity prices, including future gas pricing in Canada[22]. - Gran Tierra's financial outlook is subject to various risks, including geopolitical events and changes in commodity prices, which may impact operational performance[23]. - Gran Tierra's acquisition of i3 Energy is expected to provide anticipated benefits and operating synergies, although specific financial guidance for 2024 is no longer applicable on a combined company basis[23]. Non-GAAP Measures - The company emphasizes that non-GAAP measures, such as operating netback and cash netback, are useful for analyzing financial performance and should not be viewed as alternatives to GAAP measures[24]. - The company's operating netback was $34.18 per bbl, down 12% from the prior quarter and down 16% from Q3 2023[16]. - Average realized price per bbl was $51.03, down from $58.03 in the prior quarter[19].