GeoPark(US:GPRK)2024-08-15 19:15Financial Data and Key Metrics Changes - Revenue increased by 14% compared to the first quarter, reaching $190 million, driven by higher oil prices [4] - Adjusted EBITDA rose 15% to $128 million, resulting in an EBITDA margin of 67% [4] - Net profit was $25.7 million, equivalent to $0.50 per share, impacted by non-cost charges related to the devaluation of the Colombian peso [4] - The return on average capital employed over the last 12 months was 38% [4] - The company ended the quarter with a cash position of $66 million after various financial activities [5] Business Line Data and Key Metrics Changes - Consolidated production is currently 5,000 to 5,500 barrels a day higher than reported due to recent acquisitions [7] - The Mata Mora Norte Block produced an average of 12,500 barrels a day gross in the second quarter [7] - The company expects to drill three to five new wells before the end of the year in the Llanos basin blocks [6] Market Data and Key Metrics Changes - The average production in Argentina was 2,500 barrels per day, with expectations for gradual increases [29] - The company anticipates finishing the year with production between 13,000 and 14,000 barrels equivalent per day [10][32] Company Strategy and Development Direction - The company is focused on strategic growth initiatives, disciplined financial management, and sustainability as key performance drivers [9] - Inorganic opportunities are a key component of the company's strategy, focusing on assets that provide immediate production capabilities [13][15] - The company is targeting acquisitions in Colombia, Argentina, and Brazil to enhance long-term sustainability [16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about production increases in Argentina and the performance of new wells in Vaca Muerta [10][12] - The company is addressing operational challenges, including social unrest affecting production [26] - Future tax obligations are expected to be influenced by oil price environments, with a projected effective tax rate around 40% for the year [33][34] Other Important Information - The company repurchased $43.7 million worth of shares and paid $7.5 million in dividends during the quarter [5] - A new oil prepayment agreement was established, providing additional liquidity and a lower discount for CPO-5 production [36] Q&A Session Summary Question: What is the expected production progress in Argentina for the second half of the year and 2025? - Management expects a gradual increase in production, aiming for 20,000 barrels per day net by the end of 2025 [10] Question: Is the company targeting new acquisitions in the region? - The company is actively pursuing inorganic opportunities, focusing on assets that provide immediate production capabilities and long-term sustainability [13][15] Question: What is the current production in Colombia and the expected cash tax for the second half of the year? - Current production in Colombia is around 28,000 barrels per day, with expected cash tax outflows of approximately $20 million to $25 million for the remainder of the year [20][33] Question: Can you provide details on the new prepayment agreement and its implications? - The prepayment agreement with Trafigura covers a 12-month duration and aims to capture a premium for lighter crudes, enhancing financial flexibility [36][37]