Gran Tierra Energy(GTE) - 2025 Q2 - Quarterly Report

Financial Performance - Net loss for Q2 2025 was $12.7 million or $(0.36) per share, compared to a net income of $36.4 million or $1.16 per share in Q2 2024[92] - Adjusted EBITDA decreased to $77.0 million in Q2 2025 from $103.0 million in Q2 2024[92] - Operating netback decreased to $89.0 million in Q2 2025 from $112.9 million in Q2 2024[92] - Net loss for Q2 2025 was $12,741,000 compared to a profit of $36,371,000 in Q2 2024, representing a 135% decrease[97] - Adjusted EBITDA for Q2 2025 was $76,987,000, down 25% from $103,004,000 in Q2 2024[97] - Funds flow from operations for Q2 2025 was $53,906,000, up 17% from $46,167,000 in Q2 2024[97] - For the six months ended June 30, 2025, the company reported a net loss of $32.021 million, with adjusted EBITDA of $162.149 million, a decrease from $197.796 million in the same period of 2024[165] - Funds flow from operations for the six months ended June 30, 2025, decreased by 9% to $109.250 million compared to $120.474 million in 2024[165] Production and Sales - NAR production increased by 53% to 39,800 BOEPD in Q2 2025, compared to 26,002 BOEPD in Q2 2024[92] - Sales volumes rose by 52% to 38,331 BOEPD in Q2 2025, compared to 25,191 BOEPD in Q2 2024[92] - Oil, natural gas, and NGL sales for Q2 2025 were $152.5 million, a decrease of 8% from $165.6 million in Q2 2024[1] - Oil, natural gas, and NGL production NAR for the three and six months ended June 30, 2025, increased by 53% and 51% to 39,800 BOEPD and 39,185 BOEPD, respectively, compared to the same periods in 2024[101] - Total sales volumes increased by 52% to 38,331 BOEPD in Q2 2025 from 25,191 BOEPD in Q2 2024[98] Expenses - Operating expenses increased by 19% to $55,855,000 in Q2 2025 compared to $47,035,000 in Q2 2024[98] - General and administrative expenses before stock-based compensation increased to $14.5 million in Q2 2025 from $11.0 million in Q2 2024[94] - Operating expenses for Q2 2025 increased by 19% to $55.9 million compared to $47.0 million in Q2 2024, primarily due to new Canadian operations[2] - G&A expenses before stock-based compensation increased by 32% to $14.5 million in Q2 2025 compared to $11.0 million in Q2 2024[2] - DD&A expenses for Q2 2025 were $68.6 million, an increase of 24% from $55.5 million in Q2 2024[3] Pricing and Revenue - Oil, natural gas, and NGL sales decreased by 8% to $152.5 million in Q2 2025, primarily due to lower oil prices[92] - The average Brent price per barrel decreased by 22% to $66.71 in Q2 2025 from $85.03 in Q2 2024[98] - The average realized price for oil, natural gas, and NGL sales in Colombia for the three months ended June 30, 2025, was $56.40, down from $72.20 in 2024[119] - Average realized price for oil in Q2 2025 was $43.72 per barrel, down from $72.24 in Q2 2024[4] Capital Expenditures - Capital expenditures for Q2 2025 were $51.2 million, down from $61.3 million in Q2 2024[94] - Capital expenditures during the three months ended June 30, 2025, were $51.1 million[150] Debt and Financial Position - The outstanding balance under the reserve-based lending facility was $24.5 million as of June 30, 2025[156] - The principal amount of 9.50% Senior Notes due 2029 is to be repaid in installments starting October 15, 2026, with 25% of the principal amount due[159] - The consolidated net debt to consolidated adjusted EBITDA ratio was maintained at 3.00 to 1.00, and the consolidated interest coverage ratio was at 2.50 to 1.00[161] - The outstanding balance under the Canadian revolving credit facility was $22 million and $24.5 million under the Colombian reserve-based lending facility as of June 30, 2025[173] Foreign Exchange and Taxation - Foreign exchange losses increased by 184% to $3,716,000 in Q2 2025 from a gain of $4,413,000 in Q2 2024[98] - Current income tax expense was $10.5 million for the six months ended June 30, 2025, down from $46.2 million in the same period of 2024, primarily due to lower taxable income[144] - Deferred income tax recovery for the six months ended June 30, 2025, was $2.3 million, mainly due to the use of a higher enacted tax rate on Colombian tax losses[145] Strategic Developments - The company entered Canada with the acquisition of i3 Energy, which closed on October 31, 2024, leading to increased production volumes[111] - The company entered into an agreement to sell its subsidiary Gran Tierra North Sea Limited for total consideration of $7.5 million, expected to close in Q4 2025[163] - A $200 million prepayment structure backed by crude oil deliveries is being established to enhance financial flexibility, with expected closure in Q3 2025[164] - As of June 30, 2025, the company had hedged 3,299 bopd crude volumes in Colombia and 839 bopd in Canada to manage cash flow variability[168] - The company had outstanding foreign currency derivative positions hedging $100 million with a floor price of COP 4,430 and a cap price of COP 4,706[172]