ma
Eos el
GEOPARK
Santiago, 09 de junio de 2015
GeoPark Limited
Inscrito en el Registro de Valores Extranjeros bajo N* 045
Señor
Carlos Pavez Tolosa
Superintendente de Valores y Seguros
Av. Libertador Bernardo O’Higgins N* 1449, piso 1
PRESENTE
REF.: Adjunta información relevante que
se publicó en el U.S. Securities and
Exchange Commission (SEC) el día
19/05/15.
Señor Superintendente:
En virtud de lo establecido en la Norma de Carácter
General N*352, por medio de la presente adjunto información considerada como
relevante para la empresa, que ha sido entregada el día 19 de mayo de 2015, en el
U.S. Securities and Exchange Commission (“SEC”), en donde se informa los estados
financieros consolidados de la Compañía correspondientes al periodo finalizado el
31 de marzo de 2015.
La información adjunta consiste en un documento de
dieciocho páginas en idioma inglés.
Sin otro particular, saluda atentamente a Usted,
EH
/ Pedro Aylwin Chiofrini
pp. GEOPARK LIMITED
Nuestra Señora de los Ángeles 179 – Las Condes, Santiago – Chile
Tel. (+56 2) 2429600 – infoWgeo-park.com – www.geo-park.com
GEOPARK LIMITED
INTERIM CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
For the three-months period ended 31 March 2014 and 2015
GEOPARK LIMITED
31 MARCH 2015
CONTENTS
Page
3 Consolidated Statement of Income and Consolidated Statement of Comprehensive
Income
4 Consolidated Statement of Financial Position
5 Consolidated Statement of Changes in Equity
6 Consolidated Statement of Cash Flow
7 Selected explanatory notes
GEOPARK LIMITED
31 MARCH 2015
CONSOLIDATED STATEMENT OF INCOME
Three-months Three-months
period ended period ended
31 March 2015 31 March 2014
Amounts in US$ “000 Note (Unaudited) (Unaudited)
NET REVENUE 2 54,431 84,731
Production and operating costs 4 (23,895) (20,085)
Geological and geophysical expenses 5 (2,661) (2,719)
Administrative expenses 6 (9,841) (10,610)
Selling expenses 7 (2,307) (6,318)
Depreciation (25,471) (18,108)
Write-off of unsuccessful efforts – (4,087)
Other (expenses) income (7,159) 612
OPERATING (LOSS) PROFIT (16,903) 23,416
Financial costs 8 (9,030) (6,299)
Foreign exchange loss (19,746) (1,283)
(LOSS) PROFIT BEFORE TAX (45,679) 15,834
Income tax benefit (expense) 9,662 (5,511)
(LOSS) PROFIT FOR THE PERIOD (36,017) 10,323
Attributable to:
Owners of the parent (32,656) 6,702
Non-controlling interest (3,361) 3,621
(Losses) Earnings per share (in US$) for (loss)
profit attributable to owners of the Company. Basic (0.57) 0.13
(Losses) Earnings per share (in US$) for (loss) profit
attributable to owners of the Company. Diluted (0.57) 0.10
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Three-months Three-months
period ended 31 period ended 31
March 2015 March 2014
Amounts in US$ “000 (Unaudited) (Unaudited)
(Loss) Profit for the period (36,017) 10,323
Other comprehensive income
Currency translation differences (4,375) 931
Total comprehensive income for the period (40,392) 11,254
Attributable to:
Owners of the parent (37,031) 7,633
Non-controlling interest (3,361) 3,621
GEOPARK LIMITED
31 MARCH 2015
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
At 31 March
2015 Year ended 31
Amounts in US$ “000 Note (Unaudited) December 2014
ASSETS
NON CURRENT ASSETS
Property, plant and equipment 9 760,422 790,767
Prepaid taxes 1,654 1,253
Other financial assets 13,698 12,979
Deferred income tax 39,268 33,195
Prepayments and other receivables 275 349
TOTAL NON CURRENT ASSETS 815,317 838,543
CURRENT ASSETS
Inventories 5,291 8,532
Trade receivables 31,695 36,917
Prepayments and other receivables 11,972 13,993
Prepaid taxes 14,702 13,459
Cash at bank and in hand 91,402 127,672
TOTAL CURRENT ASSETS 155,062 200,573
TOTAL ASSETS 970,379 1,039,116
EQUITY
Equity attributable to owners of the
Company
Share capital 10 58 58
Share premium 210,122 210,886
Reserves 119,642 124,017
Retained earnings 8,943 40,596
Attributable to owners of the Company 338,765 375,557
Non-controlling interest 100,208 103,569
TOTAL EQUITY 438,973 479,126
LIABILITIES
NON CURRENT LIABILITIES
Borrowings 11 347,978 342,440
Provisions for other long-term liabilities 12 47,022 46,910
Deferred income tax 28,824 30,065
Trade and other payables 13 18,963 16,583
TOTAL NON CURRENT LIABILITIES 442,787 435,998
CURRENT LIABILITIES
Borrowings 11 15,456 27,153
Current income tax 6,828 7,935
Trade and other payables 13 66,335 88,904
TOTAL CURRENT LIABILITIES 88,619 123,992
TOTAL LIABILITIES 531,406 559,990
TOTAL EQUITY AND LIABILITIES 970,379 1,039,116
GEOPARK LIMITED
31 MARCH 2015
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Attributable to owners of the Company
Non –
Share Share Other Translation Retained “ontrolling
Amount in US$ ‘000 Capital Premium Reserve Reserve earnings Interest Total
Equity at 1 January 2014 44 120,426 127,527 (1,062) 23,906 95,116 365,957
Profit for the three-months period – – – – 6,702 3,621 10,323
Currency translation differences – – – 931 – – 931
01d income for the period . . . 931 6,702 3,621 11,254
Shared-based payment – – – – 2,559 – 2,559
Proceeds from issuance of shares 14 90,848 – – – – 90,862
14 90,848 – – 2,559 – 93,421
Balance at 31 March 2014 (Unaudited) 58 211,274 127,527 (131) 33,167 98,737 470,632
Balance at 31 December 2014 58 210,886 127,527 (3,510) 40,596 103,569 479,126
(Loss) Profit for the three-months period – – – – (32,656) (3,361) (36,017)
Currency translation differences – – – (4,375) – – (4,375)
OE income for the period . . . (4,375) (32,656) (3,361) (40,392)
Shared-based payment – 198 – – 1,003 – 1,201
Repurchase of shares – (962) – – – – (962)
– (764) – – 1,003 – 239
Balance at 31 March 2015 (Unaudited) 58 210,122 127,527 (7,885) 8,943 100,208 438,973
CONSOLIDATED STATEMENT OF CASH FLOW
GEOPARK LIMITED
31 MARCH 2015
Three-months Three-months
period ended period ended
31 March 31 March
2015 2014
Amounts in US$ ‘000 (Unaudited) (Unaudited)
Cash flows from operating activities
(Loss) Profit for the period (36,017) 10,323
Adjustments for:
Income tax (benefit) expense (9,662) 5,511
Depreciation 25,471 18,108
Write-off of unsuccessful efforts – 4,087
Amortisation of other long-term liabilities (99) (166)
Accrual of borrowing’s interests 7,025 6,049
Unwinding of long-term liabilities 714 55
Accrual of share-based payment 1,201 2,962
Foreign exchange loss 19,746 1,283
Changes in working capital (17,806) (10,731)
Cash flows (used in) / from operating activities – net (9,427) 37,481
Cash flows from investing activities
Purchase of property, plant and equipment (12,303) (45,248)
Acquisitions of companies, net of cash acquired – (115,238)
Collections related to financial leases – 1,180
Cash flows used in investing activities – net (12,303) (159,306)
Cash flows from financing activities
Proceeds from borrowings – 69,972
Proceeds from issuance of shares – 90,862
Proceeds from transaction with non-controlling interest 2,400 –
Principal paid (25) (16,911)
Repurchase of shares (962) –
Interest paid (13,040) (11,309)
Cash flows (used in) / from financing activities – net (11,627) 132,614
Net (decrease) / increase in cash and cash equivalents (33,357) 10,789
Cash and cash equivalents at 1 January 127,672 121,135
Currency translation differences (2,913) –
Cash and cash equivalents at the end of the period 91,402 131,924
Ending Cash and cash equivalents are specified as
follows:
Cash in banks 91,389 131,909
Cash in hand 13 24
Bank overdrafts – (9)
Cash and cash equivalents 91,402 131,924
GEOPARK LIMITED
31 MARCH 2015
SELECTED EXPLANATORY NOTES
Note 1
General information
GeoPark Limited (the Company) is a company incorporated under the law of Bermuda. The Registered Office
address is Cumberland House, 9th Floor, 1 Victoria Street, Hamilton HM11, Bermuda.
The principal activity of the Company and its subsidiaries (“the Group”) are exploration, development and
production for oil and gas reserves in Chile, Colombia, Brazil and Argentina. The Group has working interests
and/or economic interests in 31 hydrocarbon blocks.
This consolidated interim financial report was authorised for issue by the Board of Directors on
18 May 2015.
Basis of Preparation
The consolidated interim financial report of GeoPark Limited is presented in accordance with IAS 34 “Interim
Financial Reporting”. lt does not include all of the information required for full annual financial statements,
and should be read in conjunction with the annual financial statements as at and for the years ended 31
December 2013 and 2014, which have been prepared in accordance with IFRS.
The consolidated interim financial report has been prepared in accordance with the accounting policies
applied in the most recent annual financial statements. For further information please refer to GeoPark
Limited’s consolidated financial statements for the year ended 31 December 2014.
Taxes on income in the interim periods are accrued using the tax rate that would be applicable to expected
total annual profit or loss.
The activities of the Company are not subject to significant seasonal changes.
The Management of the Company has changed the presentation of the Consolidated Statement of Income
re-ordering the profit and loss line ¡items for a better explanation of the elements of performance.
Estimates
The preparation of interim financial information requires the use of certain critical accounting estimates. lt
also requires management to exercise ¡its judgement in the process of applying the Group’s accounting
policies. Actual results may differ from these estimates.
In preparing these condensed consolidated interim financial statements, the significant judgements made by
management in applying the group’s accounting policies and the key sources of estimation uncertainty were
the same as those that applied to the consolidated financial statements for the year ended 31 December
2014.
Note 1 (Continued)
Financial risk management
GEOPARK LIMITED
31 MARCH 2015
The Company’s activities expose it to a variety of financial risks: currency risk, price risk, credit risk-
concentration, funding and liquidity risk, interest risk and capital risk. The interim condensed consolidated
financial statements do not include all financial risk management information and disclosures required in the
annual financial statements, and should be read in conjunction with the Company’s annual financial
statements as at 31 December 2014.
There have been no changes in the risk management since year end or in any risk management policies.
Subsidiary undertakings
The following chart illustrates the Group structure as of 31 March 2015 (*):
GeoPark Limited
(Bermuda)
100% 100% 99,9% 99.9% 99.9%
/ ]
GeoPark GeoPark Latin GeoPark Perú GeoPark Brazil
! jeoParh
o ! racial America Cobperatie Cobperatie UA. Coóperatie U.A.
e ! Limited – Bermuda UA (The Netherlands) (The Netherlands)
; (The Netherlands)
1
100% ! 100% 80% 90.9%
1
GeoPark Latin 1 GeoPark Argentina GeoPark Colombia Lo GeoPark Brazl
America Limited 1 Limited – Coóperatie U.A. International Exploracáo e Producáo
Agencia en Chile ‘ Argentinean Branch (The Netherlands) niematora de Petróleo e Gás Ltda
: (Brazil
‘
! 100%
1
¡ GeoPark Colombia
1 SAS (Colombia)
1
1
1
+ 99.9%
! GeoPark SAC.
80% 299% 1 100% (Perú)
! GeoPark
LG [20% | GeoPark Chile GeoPaSA | 1 | compas a
intemational S.A. (Chile) (Chile) ! (Chio)
14% : : 99.9% 99.9%
1 ‘ . GeoPark Operadora
: ! estilo del Perú SAC.
! ! S.AC. (Perú) (Pera)
! 86% 100% 99%,
GeoPark TdF GeoPark Fell Seopark
S.A. (Chil SpA. (Chil Magallanes
(cio) pica] Limitada (Chile)
(*) LGI is not a subsidiary, it is Non-controlling interest.
Note 1 (Continued)
Subsidiary undertakings (Continued)
Details of the subsidiaries and joint operations of the Company are set out below:
Name and registered office
GEOPARK LIMITED
31 MARCH 2015
Ownership interest
Subsidiaries GeoPark Argentina Limited – Bermuda
100%
GeoPark Argentina Limited – Argentinean Branch 100% (a)
GeoPark Latin America Limited 100%
GeoPark Latin America Limited – Agencia en Chile 100% (a)
GeoPark S.A. (Chile) 100% (a) (b)
GeoPark Brazil Exploragáo y Produgáo de Petróleo e Gás Ltda. (Brazil) 100% (a) (f)
GeoPark Chile S.A. (Chile) 80% (a) (c)
GeoPark Fell S.p.A. (Chile) 80% (a) (c)
GeoPark Magallanes Limitada (Chile) 80% (a) (c)
GeoPark TdF S.A. (Chile) 68.8% (a) (d)
GeoPark Colombia S.A. (Chile) 100% (a,
GeoPark Colombia SAS (Colombia)
GeoPark Brazil S.p.A. (Chile)
GeoPark Latin America Coóperatie U.A. (The Netherlands)
GeoPark Colombia Coóperatie U.A. (The Netherlands)
GeoPark S.A.C. (Perú)
GeoPark Perú S.A.C. (Perú) 100% (a,
GeoPark Operadora del Perú S.A.C. (Perú) 100% (a,
GeoPark Perú Coóperatie U.A. (The Netherlands) 100%
GeoPark Brazil Coóperatie U.A. (The Netherlands) 100%
Joint operations Tranquilo Block (Chile) 50% (e)
Flamenco Block (Chile) 50% (e)
Campanario Block (Chile) 50% (e)
Isla Norte Block (Chile) 60% (e)
Llanos 17 Block (Colombia) 36.84%
Yamu/Carupana Block (Colombia) 79.5%/90% (e)
Llanos 34 Block (Colombia) 45% (e)
Llanos 32 Block (Colombia) 10%
CPO-4 Block (Colombia) 50% (e)
Puelen (Argentina) 18%
Sierra del Nevado (Argentina) 18%
Manati Field (Brazil) 10%
(a) Indirectiy owned.
(0) Dormant companies.
(c) LG International has 20% interest.
(d) LG International has 20% interest through GeoPark Chile S.A. and a 14% direct interest, totaling 31.2%.
(e) GeoParkis the operator in all blocks.
(f) On 17 December 2014, the ANP approved the transfer of cession of rights of the Block from Rio das Contas to GeoPark Brazil. On 31 January 2015, both companies,
Rio das Contas and GeoPark Brazil were merged into GeoPark Brazil (see Note 34.c to the audited Consolidated Financial Statements as of 31 December 2014).
Note 2
Net revenue
Three-months Three-months
period ended 31 period ended 31
Amounts in US$ ‘000 March 2015 March 2014
Sale of crude oil 40,793
Sale of gas 13,638
54,431
GEOPARK LIMITED
31 MARCH 2015
Note 3
Segment Information
Operating segments are reported in a manner consistent with the internal reporting provided to the chief
operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources
and assessing performance of the operating segments, has been identified as the Executive Committee.
This committee is integrated by the CEO, COO, CFO and managers in charge of the Geoscience, Operations,
Legal and Governance, Finance and People departments. This committee reviews the Group’s internal
reporting in order to assess performance and allocate resources. Management has determined the operating
segments based on these reports.
The committee considers the business from a geographic perspective. As of 2015, the committee has
changed the disclosure of certain elements of performance to be more comparable with other companies in
the market and also to better follow up the performance of the business. This change impacts the segment
information because gross profit or loss is no longer shown but no impact is generated in the measure of
segment profit and loss.
The Executive Committee assesses the performance of the operating segments based on a measure of
Adjusted EBITDA. Adjusted EBITDA ¡is defined as profit for the period before net finance cost, income tax,
depreciation, amortization, certain non-cash items such as impairments and write-offs of unsuccessful efforts,
accrual of share-based payment and other non recurring events. Operating Netback is equivalent to Adjusted
EBITDA before cash expenses included in Administrative, Geological and Geophysical and Other operating
expenses. Other information provided, except as noted below, to the Executive Committee is measured in a
manner consistent with that in the financial statements.
Three-months period ended 31 March 2015
Amounts in US$ ‘000 Total Argentina Chile Brazil Perú Colombia Corporate
Net Revenue 54,431 370 13,901 9,415 – 30,745 –
Sale of crude oil 40,793 370 9,423 255 – 30,745 –
Sale of gas 13,638 – 4,478 9,160 – – –
Production and operating costs (23,895) (482) (10,048) (1,864) – (11,497) (4)
Royalties (1,716) (28) (622) (643) – (423) –
Transportation costs (1,482) – (851) – – (631) –
Share-based payment (1) (44) 85 – – (38) (4)
Other costs (20,696) (410) (8,660) (1,221) – (10,405) –
Depreciation (25,471) (50) (10,807) (3,473) (31) (11,110) –
Operating (Loss) Profit (16,903) (2,174) (16,183) 3,150 (1,092) 3,788 (4,392)
Adjusted EBITDA 16,841 (1,014) (45) 6,960 (1,014) 16,303 (4,349)
10
GEOPARK LIMITED
31 MARCH 2015
Note 3
Segment Information (Continued)
Three-months period ended 31 March 2014
Amounts in US$ ‘000 Total Argentina Chile Brazil Perú Colombia Corporate
Net Revenue 84,731 352 47,155 – – 37,224 –
Sale of crude oil 75,234 351 37,659 – – 37,224 –
Sale of gas 9,497 1 9,496 – – – –
Production and operating costs (20,085) 298 (10,329) – – (9,993) (61)
Royalties (4,417) (47) (2,120) – – (2,250) –
Transportation costs (3,584) (43) (1,999) – – (1,542) –
Share-based payment (518) (143) (169) – – (182) (24)
Other costs (11,566) 531 (6,041) – – (6,019) (37)
Depreciation (18,108) (67) (9,911) – – (8,116) (14)
Operating Profit / (Loss) 23,416 (2,468) 16,568 (725) – 12,235 (2,194)
Adjusted EBITDA 48,379 (1,263) 30,688 (702) – 20,690 (1,034)
Total Assets Total Argentina Chile Brazil Perú Colombia Corporate
31 March 2015 970,379 3,672 533,919 118,371 3,308 246,125 64,984
31 December 2014 1,039,116 3,839 541,481 151,770 4,813 263,070 74,143
A reconciliation of total Operating netback to total profit before income tax is provided as follows:
Three-months Three-months
Amounts in US$ ‘000 period ended 31 period ended
March 2015 31 March 2014
Operating netback 28,143 59,264
Geological and geophysical expenses (2,529) (2,021)
Administrative expenses (8,773) (8,864)
Adjusted EBITDA for reportable segments 16,841 48,379
Depreciation (*) (25,471) (18,108)
Share-based payment (1,201) (2,962)
Write-off of unsuccessful efforts – (4,087)
Others *) (7,072) 194
Operating (Loss) Profit (16,903) 23,416
Financial costs (9,030) (6,299)
Foreign exchange loss (19,746) (1,283)
(Loss) Profit before tax (45,679) 15,834
(8) Net of capitalised costs for oil stock included in Inventories. Depreciation includes US$ 916,000
(US$ 519,000 in 2014) generated by assets not related to production activities.
(2 In 2015 includes termination costs (see Note 14). Also includes internally capitalised costs.
11
GEOPARK LIMITED
31 MARCH 2015
Note 4
Production and operating costs
Three-months Three-months
period ended period ended
Amounts in US$ ‘000 31 March 2015 31 March 2014
Staff costs 5,605 2,579
Well and facilities maintenance 4,958 4,466
Consumables 2,491 4,571
Royalties 1,716 4,417
Transportation costs 1,482 3,584
Equipment rental 1,040 1,880
Field camp 970 1,323
Gas plant costs 504 835
Non operated blocks costs 870 1,247
Share-based payment 1 518
Other costs 2,715 2,548
Crude oil stock variation 1,543 (7,883)
23,895 20,085
Note 5
Geological and geophysical expenses
Three-months Three-months
Amounts in US$ ‘000 period ended 31 period ended 31
March 2015 March 2014
Staff costs 2,019 2,200
Allocation to capitalised project (107) (610)
Share-based payment 132 698
Other services 617 431
2,661 2,719
12
GEOPARK LIMITED
31 MARCH 2015
Note 6
Administrative expenses
Three-months Three-months
period ended 31 period ended 31
Amounts in US$ ‘000 March 2015 March 2014
Staff costs 5,359 3,813
Share-based payment 1,068 1,746
Consultant fees 913 1,263
New projects 147 431
Office expenses 901 769
Director fees and allowance 273 286
Other administrative expenses 1,180 2,302
9,841 10,610
Note 7
Selling expenses
Three-months Three-months
period ended 31 period ended 31
Amounts in US$ ‘000 March 2015 March 2014
Transportation 2,211 6,047
Selling taxes and other 96 271
2,307 6,318
Note 8
Financial costs
Three-months Three-months
period ended 31 period ended 31
Amounts in US$ ‘000 March 2015 March 2014
Financial expenses
Interest and amortisation of debt issue costs 7,749 6,837
Less: amounts capitalised on qualifying assets (103) (382)
Bank charges and other financial costs 1,007 306
Unwinding of long-term liabilities 714 55
Financial income
Interest received (337) (517)
9,030 6,299
13
Note 9
Property, plant and equipment
GEOPARK LIMITED
31 MARCH 2015
Buildings Exploration
Furniture, Production and and
Oil 8 gas equipment facilities and improve- Construction evaluation
Amounts in US$’000 properties and vehicles machinery ments in progress assets TOTAL
Cost at 1 January 2014 493,260 5,731 98,837 7,018 40,429 147,759 793,034
Additions 421 354 – – 26,225 35,205 62,205
Acquisition of subsidiaries 115,347 268 – – – – 115,615
Write-off and impairment (1 – – – – – (4,087) (4,087)
Transfers 47,607 – 6,534 74 (22,490) (31,725) –
Cost At 31 March 2014 656,635 6,353 105,371 7,092 44,164 147,152 966,767
Cost at 1 January 2015 749,947 12,057 111,646 9,527 59,425 140,444 1,083,046
Additions (1,956) 2 365 – 24 7,927 3,933 10,293
Currency translation differences (15,558) (37) – 190 (1,510) (514) (17,429)
Transfers 10,959 229 3,649 – (9,806) (5,031) –
Cost At 31 March 2015 743,392 12,614 115,295 9,741 56,036 138,832 1,075,910
Depreciation and write-down
at 1 January 2014 (157,390) (2,800) (35,677) (1,721) – – (197,588)
Depreciation (18,205) (323) (3,000) (196) – – (21,724)
Depreciation and write-down
At 31 March 2014 (175,595) (3,123) (38,677) (1,917) – – (219,312)
Depreciation and write-down
at 1 January 2015 (240,439) (4,449) (45,147) (2,244) – – (292,279)
Depreciation (20,950) (692) (2,920) (224) – – (24,786)
Currency translation differences 1,805 (107) – (121) – – 1,577
Depreciation and write-down
at 31 March 2015 (259,584) (5,248) (48,067) (2,589) – – (315,488)
Carrying amount at 31 March
2014 481,040 3,230 66,694 5,175 44,164 147,152 747,455
Carrying amount at 31 March
2015 483,808 7,366 67,228 7,152 56,036 138,832 760,422
(1 Corresponds to write-off of Exploration and evaluation assets in Chile for US$ 4,087,000.
(2) Corresponds to the effect of restimation of assets retirement obligations in Colombia.
14
GEOPARK LIMITED
31 MARCH 2015
Note 10
Share capital
Three-months
period ended 31 Year ended 31
Issued share capital March 2015 December 2014
Common stock (US$ “000) 58 58
The share capital is distributed as follows:
Common shares, of nominal US$ 0.001 57,598,745 57,790,533
Total common shares in issue 57,598,745 57,790,533
Authorised share capital
US$ per share 0.001 0.001
Number of common shares (US$ 0.001 each) 5,171,949,000 5,171,949,000
Amount in US$ 5,171,949 5,171,949
GeoPark’s share capital only consists of common shares. The authorized share capital consists of
5,171,949,000 common shares of par value US$ 0.001 per share. As of the date of this interim condensed
consolidated report, there are 57,598,745 common shares outstanding. All of the Company issued and
outstanding common shares are fully paid and nonassessable. The Company also has an employee
incentive program, pursuant to which it has granted share awards to ¡ts senior management and certain key
employees (see Notes 25 and 29 to the audited Consolidated Financial Statements as of 31 December
2014).
Note 11
Borrowings
The outstanding amounts are as follows:
Year ended
At 31 December
Amounts in US$ ‘000 31 March 2015 2014
Notes GeoPark Latin America
Agencia en Chile (a) 295,680 300,963
Banco Itaú (b) 67,692 68,540
Banco de Crédito e Inversiones (c) 62 90
363,434 369,593
Classified as follows:
Current 15,456 27,153
Non-Current 347,978 342,440
15
GEOPARK LIMITED
31 MARCH 2015
Note 11 (Continued)
Borrowings (Continued)
(a) During February 2013, the Company successfully placed US$ 300 million notes which were offered under
Rule 144A and Regulation S exemptions of the United States Securities laws.
The Notes, issued by the Company’s wholly-owned subsidiary GeoPark Latin America Limited Agencia en
Chile (“the Issuer”), were priced at 99.332% and carry a coupon of 7.50% per annum (yield 7.625% per
annum). Final maturity of the notes will be 11 February 2020. The Notes are guaranteed by GeoPark Limited
and and GeoPark Latin America Cooperatie U.A. and are secured with a pledge of all of the equity interests
of the Issuer in GeoPark Chile S.A. and GeoPark Colombia S.A. and a pledge of certain intercompany
loans. Notes were rated single B by both Standard 8 Poor’s and Fitch Ratings. The debt issuance cost for
this transaction amounted to US$ 7,637,000. The Notes include covenants restricting dividend payments and
new indebtedness. As of the date of these interim condensed consolidated financial statements, the
Company has complied with these covenants.
(b) During March 2014, GeoPark executed a loan agreement with ltaú BBA International for
US$ 70,450,000 to finance the acquisition of a 10% working interest in the Manatí field in Brazil. The interest
rate applicable to this loan is LIBOR plus 3.9% per annum. The interest will be paid semi-annually; principal
will be cancelled semi-annually with a year grace period. The debt issuance cost for this transaction
amounted to US$ 3,295,000. This loan includes covenants restricting dividend payments and new
indebtedness. As of the date of these interim condensed consolidated financial statements, the Company
has complied with these covenants.
In March 2015, the Company reached an agreement to: (i) extend the principal payments that were due in
2015 (amounting to approximately US$ 15,000,000), which will be divided pro-rata during the remaining
principal installments, starting in March 2016 and (ii) to increase the variable interest rate to six-month LIBOR
+ 4.0%.
(c) Facility to establish the operational base in the Fell Block. This facility was acquired through a mortgage
loan granted by the Banco de Crédito e Inversiones (BCI), a Chilean private bank. The loan was granted in
Chilean pesos and is repayable over a period of 8 years. The interest rate applicable to this loan is 6.6%.
As of the date of this interim condensed consolidated report, the Group has been granted with credit lines
for over US$ 41,000,000.
16
Note 12
Provision for other long-term liabilities
The outstanding amounts are as follows:
Note 13
GEOPARK LIMITED
31 MARCH 2015
Trade and other payables
The outstanding amounts are as follows:
Classified as follows:
Year ended
At 31 December
Amounts in US$ ‘000 31 March 2015 2014
A
Deferred income 5,634 5,736
Other 9,398 7,888
47,022 46,910
Year ended
At 31 December
Amounts in US$ ‘000 31 March 2015 2014
Trade payables 38,303 64,457
Payables to related parties (1) 19,339 16,591
Taxes and other debts to be paid 10,238 10,031
Staff costs to be paid 7,349 7,226
V.A.T. 4,629 3,449
To be paid to co-venturers 4,351 1,335
Royalties to be paid 1,089 2,398
85,298 105,487
Current 66,335 88,904
Non-Current 18,963 16,583
(1) Corresponds to related parties loans granted by LGl. The maturity of these loans is July 2020 and the applicable
interest rate is 8% per annum.
17
GEOPARK LIMITED
31 MARCH 2015
Note 14
Oil industry situation and the impact on GeoPark’s operations
As a consequence of oil price crisis which started in the second half of 2014 (WTI and Brent, the main
international oil price markers, fell more than 40% between September 2014 and February 2015), the
Company has undertaken a decisive cost cutting program to ensure its ability to both maximize the work
program and preserve its liquidity. The main decisions within the mentioned program for 2015 include:
– Reduction of its capital investment taking advantage of the discretionary work programme.
– – Deferment of capital projects by regulatory authority and partner agreement.
– Renegotiation and reduction of oil and gas service contracts, including drilling and civil work
contractors, as well as transportation trucking and pipeline costs.
– Operating cost improved efficiencies and temporary suspension of certain marginal producing oil
and gas fields.Further cost reductions are expected to result from a general depreciation of Latin
American currencies (Colombian peso, Brazilian real, Chilean peso, Argentine peso and Peruvian
sol), in connection with operating and structure costs established in local currencies and also related
to a voluntary salary reduction by GeoPark’s senior management team and Board of Directors.
During February 2015, the Company reduced its workforce significantly. This reduction streamlined certain
internal functions and departments for creating a more efficient workforce in the current economic
environment. As a result, the Company expects cost savings associated with the reduction of full-time and
temporary employees, excluding one-time termination costs.
In addition, actions taken by the Company to maximize ongoing work projects and to reduce expenses,
including renegotiations and reduction of oil and gas service contracts and other initiatives included in the
cost cutting program adopted may expose the Company to claims and contingencies from interested parties
that may have a negative impact on its business, financial condition, results of operations and cash flows. As
of the date of this interim condensed consolidated report, according to internal estimates, the Company has
recognized approximately US$ 3,300,000 for future contingent payments in connection with claims of third
parties. The mentioned costs are allocated under the other (expenses) income line, included in the
Consolidated Statement of Income.
18
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