6-K 1 dp65604_6k.htm FORM 6-K

 

 

UNITED STATES 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of May 2016

 

 

Commission File Number: 001-36298

 

GeoPark Limited

(Exact name of registrant as specified in its charter)

 

Nuestra Señora de los Ángeles 179

Las Condes, Santiago, Chile

(Address of principal executive office)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

 

Form 20-F

X

   Form 40-F  

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

 

Yes     No

X

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

 

Yes     No

X

 

 

 

 

GEOPARK LIMITED

31 MARCH 2016

 

GEOPARK LIMITED

 

TABLE OF CONTENTS

 

ITEM  
1. GeoPark Limited Interim Condensed Consolidated Financial Statements for the three-months period ended 31 March 2015 and 2016

 

GEOPARK LIMITED

31 MARCH 2016

 

Item 1

 

GEOPARK LIMITED

 

 

 

 

Interim condensed consolidated  

financial statements

 

 

For the three-months period ended 31 March 2015 and 2016

 

 

 

 

 

 

 

 

 

 

GEOPARK LIMITED

31 MARCH 2016

 

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

 2

GEOPARK LIMITED

31 MARCH 2016

 

CONSOLIDATED STATEMENT OF INCOME

 

Amounts in US$  ´000 Note Three-months period ended 31 March 2016 (Unaudited) Three-months period ended 31 March 2015 (Unaudited)
NET REVENUE 2 36,564 54,431
Production and operating costs 4 (13,015) (23,895)
Geological and geophysical expenses 5 (2,354) (2,661)
Administrative expenses 6 (7,484) (9,841)
Selling expenses 7 (2,671) (2,307)
Depreciation   (21,522) (25,471)
Other expenses   (740) (7,159)
OPERATING LOSS   (11,222) (16,903)
Financial costs 8 (8,963) (9,030)
Foreign exchange income (loss)   7,457 (19,746)
LOSS BEFORE INCOME TAX   (12,728) (45,679)
Income tax benefit   685 9,662
LOSS FOR THE PERIOD   (12,043) (36,017)
Attributable to:      
Owners of the Company   (9,255) (32,656)
Non-controlling interest   (2,788) (3,361)

Losses per share (in US$) for loss

attributable to owners of the Company.

Basic

   (0.15) (0.57)

Losses per share (in US$) for loss

attributable to owners of the Company.

Diluted

   (0.15) (0.57)

 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

 

Amounts in US$  ´000   Three-months period ended 31 March 2016 (Unaudited) Three-months period ended 31 March 2015 (Unaudited)
Loss for the period   (12,043) (36,017)
Other comprehensive income      
Currency translation differences     2,415 (4,375)
Total comprehensive loss for the period   (9,628) (40,392)
Attributable to:      
Owners of the Company   (6,840) (37,031)
Non-controlling interest   (2,788) (3,361)

 

 3

GEOPARK LIMITED

31 MARCH 2016

 

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

 

Amounts in US$  ´000 Note At 31 March
 2016 (Unaudited)		 Year ended 31 December 2015
ASSETS      
NON CURRENT ASSETS      
Property, plant and equipment 9 517,453 522,611
Prepaid taxes   1,066 1,172
Other financial assets   14,701 13,306
Deferred income tax asset   24,195 34,646
Prepayments and other receivables   240 220
TOTAL NON CURRENT ASSETS   557,655 571,955
CURRENT ASSETS      
Inventories   3,644 4,264
Trade receivables   14,447 13,480
Prepayments and other receivables   8,524 11,057
Prepaid taxes   20,071 19,195
Other financial assets   1,123 1,118
Cash at bank and in hand   71,585 82,730
TOTAL CURRENT ASSETS   119,394 131,844
       
TOTAL ASSETS   677,049 703,799
EQUITY      
Equity attributable to owners of the Company      
Share capital 10 60 59
Share premium   233,567 232,005
Reserves   125,431 123,016
Accumulated losses   (218,797) (208,428)
Attributable to owners of the Company   140,261 146,652
Non-controlling interest   50,768 53,515
TOTAL EQUITY   191,029 200,167
LIABILITIES      
NON CURRENT LIABILITIES      
Borrowings 11 332,357 343,248
Provisions and other long-term liabilities 12 43,788 42,450
Deferred income tax liability   4,041 16,955
Trade and other payables 13 25,556 19,556
TOTAL NON CURRENT LIABILITIES   405,742 422,209
CURRENT LIABILITIES      
Borrowings 11 30,656 35,425
Current income tax liabilities   230 208
Trade and other payables 13 49,392 45,790
TOTAL CURRENT LIABILITIES   80,278 81,423
TOTAL LIABILITIES   486,020 503,632
       
TOTAL EQUITY AND LIABILITIES   677,049 703,799

 4

GEOPARK LIMITED

31 MARCH 2016

 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

 

  Attributable to owners of the Company    
Amount in US$ '000 Share Capital Share Premium Other Reserve Translation Reserve Accumulated losses

Non - controlling

Interest

 Total
Equity at 1 January 2015 58 210,886 127,527 (3,510) 40,596 103,569 479,126
Comprehensive income:              
Loss for the three – months period - - - - (32,656) (3,361) (36,017)
Currency translation differences - - - (4,375) - - (4,375)
Total comprehensive loss for the period ended 31 March  2015 - - - (4,375) (32,656) (3,361) (40,392)
Transactions with owners:              
Share-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
               
Balance at 31 December 2015 59 232,005 127,527 (4,511) (208,428) 53,515 200,167
Comprehensive income:              
Loss for the three – months period - - - - (9,255) (2,788) (12,043)
Currency translation differences - - - 2,415 - - 2,415
Total comprehensive loss for the period ended 31 March 2016 - - - 2,415 (9,255) (2,788) (9,628)
Transactions with owners:              
Share-based payment 1 1,562 - - (1,114) 41 490
  1 1,562 - - (1,114) 41 490
Balance at 31 March 2016 (Unaudited) 60 233,567 127,527 (2,096) (218,797) 50,768 191,029

 5

GEOPARK LIMITED

31 MARCH 2016

 

CONSOLIDATED STATEMENT OF CASH FLOW

 

Amounts in US$ ’000 Three-months period ended 31 March 2016 (Unaudited) Three-months period ended 31 March 2015  (Unaudited)
Cash flows from operating activities    
Loss for the period (12,043) (36,017)
Adjustments for:    
Income tax benefit (685) (9,662)
Depreciation 21,522 25,471
Amortisation of other long-term liabilities (146) (99)
Accrual of borrowing’s interests 6,970 7,025
Unwinding of long-term liabilities 845 714
Accrual of share-based payment 490 1,201
Foreign exchange (income) loss (7,457) 19,746
Customer advance payments 10,000 -
Change in working capital 423 (17,806)
Cash flows from / (used in) operating activities – net 19,919 (9,427)
Cash flows from investing activities    
Purchase of property, plant and equipment (8,350) (12,303)
Cash flows used in investing activities – net (8,350) (12,303)
Cash flows from financing activities    
Proceeds from borrowings 186 -
Proceeds from loans from related parties - 2,400
Principal paid (10,070) (25)
Repurchase of shares - (962)
Interest paid (12,810) (13,040)
Cash flows used in financing activities - net   (22,694) (11,627)
Net decrease in cash and cash equivalents (11,125) (33,357)
Cash and cash equivalents at 1 January 82,730 127,672
Currency translation differences (20) (2,913)
Cash and cash equivalents at the end of the period 71,585 91,402
Ending Cash and cash equivalents are specified as follows:    
Cash in banks 71,572 91,389
Cash in hand 13 13
Cash and cash equivalents 71,585 91,402

 6

GEOPARK LIMITED

31 MARCH 2016

 

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, Peru and Argentina.

 

This consolidated interim financial report was authorised for issue by the Board of Directors on
9 May 2016.

 

Basis of Preparation

 

The consolidated interim financial report of GeoPark Limited is presented in accordance with IAS 34 “Interim Financial Reporting”. It 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 2014 and 2015, 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 2015.

 

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.

 

Estimates

 

The preparation of interim financial information requires the use of certain critical accounting estimates. It 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 2015.

 

 7

GEOPARK LIMITED

31 MARCH 2016

 

Note 1 (Continued)

 

Financial risk management

 

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 2015.

 

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 2016 (*):

 

 

 

(*) LG International is not a subsidiary, it is Non-controlling interest.

 

There have been no changes in the Group structure year end.

 

 8

GEOPARK LIMITED

31 MARCH 2016

 

Note 1 (Continued)

 

Subsidiary undertakings (Continued)

 

Details of the subsidiaries and joint operations of the Company are set out below:

 

  Name and registered office     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 Exploração y Produção de Petróleo e Gás Ltda. (Brazil)     100% (a)
  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)     100% (a)
  GeoPark Brazil S.p.A. (Chile)     100% (a) (b)
  GeoPark Latin America Coöperatie U.A. (The Netherlands)     100%
  GeoPark Colombia Coöperatie U.A. (The Netherlands)     80% (a) (c)
  GeoPark S.A.C. (Peru)     100% (a)
  GeoPark Perú S.A.C. (Peru)     100% (a)
  GeoPark Operadora del Perú S.A.C. (Peru)     100% (a)
  GeoPark Peru Coöperatie U.A. (The Netherlands)     100%
  GeoPark Brazil Coöperatie U.A. (The Netherlands)     100%
  GeoPark Colombia E&P S.A.(Panama)     100% (b)
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)     89.5%/100% (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%
  CN-V (Argentina)      50%
  Manati Field (Brazil)     10%

 

(a)Indirectly owned.

 

(b)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)GeoPark is the operator in all blocks.

 

 9

GEOPARK LIMITED

31 MARCH 2016

 

Note 2

 

Net Revenue

 

Amounts in US$ '000 Three-months period ended 31 March 2016 Three-months period ended 31 March 2015
     
Sale of crude oil 23,169 40,793
Sale of gas 13,395 13,638
  36,564 54,431

 

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, Corporate 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. Since 1 January 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.

 

 10

GEOPARK LIMITED

31 MARCH 2016

 

Note 3 (Continued)

 

Segment Information (Continued)

 

Three-months period ended 31 March 2016

 

Amounts in US$ '000 Total Colombia Chile Brazil Argentina Peru Corporate
Net Revenue 36,564 19,038 9,201 8,325 - - -
        Sale of crude oil 23,169 19,038 3,959 172 - - -
        Sale of gas 13,395 - 5,242 8,153 - - -
Production and operating costs (13,015) (5,849) (5,195) (1,971) - - -
        Royalties (1,756) (640) (359) (757) - - -
        Transportation costs (757) (367) (390) - - - -
        Share-based payment (80) (63) (17) - - - -
        Other costs (10,422) (4,779) (4,429) (1,214) - - -
Depreciation (21,522) (8,473) (9,050) (3,917) (49) (33) -
Operating (Loss) / Profit (11,222) (1,946) (7,796) 1,328 82 (819) (2,071)
Adjusted EBITDA 11,553 6,618 1,289 5,358 804 (769) (1,747)

 

Three-months period ended 31 March 2015

 

Amounts in US$ '000 Total Colombia Chile Brazil Argentina Peru Corporate
Net Revenue 54,431 30,745 13,901 9,415 370 - -
        Sale of crude oil 40,793 30,745 9,423 255 370 - -
        Sale of gas 13,638 - 4,478 9,160 - - -
Production and operating costs (23,895) (11,497) (10,048) (1,864) (482) - (4)
        Royalties (2,083) (790) (622) (643) (28) - -
        Transportation costs (1,482) (631) (851) - - - -
        Share-based payment (1) (38) 85 - (44) - (4)
        Other costs (20,329) (10,038) (8,660) (1,221) (410) - -
Depreciation (25,471) (11,110) (10,807) (3,473) (50) (31) -
Operating (Loss) / Profit (16,903) 3,788 (16,183) 3,150 (2,174) (1,092) (4,392)
Adjusted EBITDA 16,841 16,303 (45) 6,960 (1,014) (1,014) (4,349)

 

 

Total Assets Total Colombia Chile Brazil Argentina Peru Corporate
31 March 2016 677,049 154,661 368,512 97,338 2,749 5,016 48,773
31 December 2015 703,799 153,071 381,143 114,974 3,181 4,287 47,143

 11

GEOPARK LIMITED

31 MARCH 2016

 

Note 3 (Continued)

 

Segment Information (Continued)

 

A reconciliation of total Operating netback to total profit before income tax is provided as follows:

 

Three -months period ended 31 March 2016 Three -months period ended 31 March 2015
Operating netback 20,981 28,143
Geological and geophysical expenses (2,303) (2,529)
Administrative expenses (7,125) (8,773)
Adjusted EBITDA for reportable segments 11,553 16,841
Depreciation (a) (21,522) (25,471)
Share-based payment (490) (1,201)
Others (b) (763) (7,072)
Operating loss (11,222) (16,903)
Financial costs (8,963) (9,030)
Foreign exchange income (loss) 7,457 (19,746)
Loss before tax (12,728) (45,679)

 

(a)Net of capitalised costs for oil stock included in Inventories. Depreciation includes US$ 955,000 (US$ 916,000 in 2015) generated by assets not related to production activities.

 

(b)Includes mainly termination costs (see Note 14 to the audited Consolidated Financial Statements as of 31 December 2015).

 

 

The following table presents a reconciliation of Adjusted EBITDA to operating profit for the three-month periods ended 31 March 2016 and 2015:

 

  Three-months period ended 31 March 2016
  Colombia Chile Brazil Other (*)
Total
Adjusted EBITDA for reportable segments 6,618 1,289 5,358 (1,712) 11,553
Depreciation (8,473) (9,050) (3,917) (82) (21,522)
Share-based payment (136) (76) (6) (272) (490)
Others 45 41 (107) (742) (763)
Operating (Loss) / Profit (1,946) (7,796) 1,328 (2,808) (11,222)

 12

GEOPARK LIMITED

31 MARCH 2016

 

Note 3 (Continued)

 

Segment Information (Continued)

 

  Three-months period ended 31 March 2015
  Colombia Chile Brazil Other (*)
Total
Adjusted EBITDA for reportable segments 16,303 (45) 6,960 (6,377) 16,841
Depreciation (11,110) (10,807) (3,473) (81) (25,471)
Share-based payment (141) 68 (22) (1,106) (1,201)
Others (**) (1,264) (5,399) (315) (94) (7,072)
Operating Profit / (Loss) 3,788 (16,183) 3,150 (7,658) (16,903)

 

(*) Includes Argentina, Peru and Corporate. 

(**) Includes termination costs.

 

Note 4

 

Production and operating costs

 

Amounts in US$ '000

Three-months period ended 31 March 2016

 Three-months period ended 31 March 2015
Staff costs 3,041 5,605
Well and facilities maintenance 1,912 4,958
Consumables 1,688 2,491
Royalties 1,756 2,083
Transportation costs 757 1,482
Equipment rental 916 1,040
Field camp 492 970
Gas plant costs 1,647 504
Non operated blocks costs 292 870
Share-based payment 80 1
Other costs 174 2,348
Crude oil stock variation 260 1,543
  13,015 23,895

 

Note 5

 

Geological and geophysical expenses

 

Amounts in US$ '000 Three-months period ended 31 March 2016 Three-months period ended 31 March 2015
Staff costs 1,709 2,019
Share-based payment 51 132
Other services 594 617
Allocation to capitalised project - (107)
  2,354 2,661

 13

GEOPARK LIMITED

31 MARCH 2016

 

Note 6

 

Administrative expenses

 

Amounts in US$ '000 Three-months period ended 31 March 2016 Three-months period ended 31 March 2015
Staff costs 4,472 5,359
Share-based payment 359 1,068
Consultant fees 739 913
Office expenses 510 901
New projects 104 147
Travel expenses 196 238
Director fees and allowance 374 273
Other administrative expenses 730 942
  7,484 9,841

 

Note 7

 

Selling expenses

 

Amounts in US$ '000 Three-months period ended 31 March 2016 Three-months period ended 31 March 2015
Transportation 2,593 2,211
Selling taxes and other 78 96
  2,671 2,307

 

Note 8

 

Financial costs

 

Amounts in US$ '000 Three-months period ended 31 March 2016 Three-months period ended 31 March 2015
Financial expenses    
Bank charges and other financial costs 910 1,007
Unwinding of long-term liabilities 845 714
Interest and amortisation of debt issue costs 7,906 7,749
Less: amounts capitalised on qualifying assets (126) (103)
Financial income    
Interest received (572) (337)
  8,963 9,030

 14

GEOPARK LIMITED

31 MARCH 2016

 

Note 9

 

Property, plant and equipment

 

Amounts in US$'000 Oil & gas properties

Furniture, equipment

and vehicles

 Production facilities and machinery

Buildings

and improvements

 Construction  in progress Exploration and evaluation assets TOTAL
Cost at 1 January 2015 749,947 12,057 111,646 9,527 59,425 140,444 1,083,046
Additions (1,956)(1) 365 - 24 7,927 3,933 10,293
Transfers 10,959 229 3,649 - (9,806) (5,031) -
Currency translation differences (15,558) (37) - 190 (1,510) (514) (17,429)
Cost at 31 March 2015 743,392 12,614 115,295 9,741 56,036 138,832 1,075,910
               
Cost at 1 January 2016 648,992 13,745 124,832 10,518 29,823 87,000 914,910
Additions 137 229 - - 4,506 3,625 8,497
Transfers 4,011 - 1,558 - (5,628) 59 -
Currency translation differences 7,429 61 651 17 - 697 8,855
Cost at 31 March 2016 660,569 14,035 127,041 10,535 28,701 91,381 932,262
               
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)
               
Depreciation and write-down at 1 January 2016 (321,173) (7,317) (60,614) (3,195) - - (392,299)
Depreciation (17,188) (732) (3,072) (223) - - (21,215)
Currency translation differences (1,155) (20) (111) (9) - - (1,295)
Depreciation and write-down at 31 March 2016 (339,516) (8,069) (63,797) (3,427) - - (414,809)
               
Carrying amount at 31 March 2015 483,808 7,366 67,228 7,152 56,036 138,832 760,422
Carrying amount at 31 March 2016 321,053 5,966 63,244 7,108 28,701 91,381 517,453

 

(1)Corresponds to the effect of restimation of assets retirement obligations in Colombia.

 

 15

GEOPARK LIMITED

31 MARCH 2016

 

Note 10

 

Share capital

 

Issued share capital Three-months period ended 31 March 2016 Year ended 31 December  2015
Common stock (US$ ´000) 60 59
The share capital is distributed as follows:    
Common shares, of nominal US$ 0.001 60,028,985 59,535,614
Total common shares in issue 60,028,985 59,535,614
     
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. 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 its senior management and certain key employees (see Notes 25 and 29 to the audited Consolidated Financial Statements as of 31 December 2015).

 

Note 11

 

Borrowings

 

The outstanding amounts are as follows:

 

Amounts in US$ '000

At

31 March 2016

Year ended

31 December
2015

Notes GeoPark Latin America Agencia en Chile (a) 297,228 302,495
Banco Itaú (b) 58,516 69,142
Banco de Chile (c) 7,084 7,036
Banco de Crédito e Inversiones (d) 185 -
  363,013 378,673

 

Classified as follows:

 

Current 30,656 35,425
Non-Current 332,357 343,248

 16

GEOPARK LIMITED

31 MARCH 2016

 

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 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. The debt issuance cost for this transaction amounted to US$ 7,637,000. The indenture governing our Notes due 2020 includes incurrence test covenants that provides among other things, that, the Debt to EBITDA ratio should not exceed 2.5 times and the EBITDA to Interest ratio should exceed 3.5 times. As of the date of these interim condensed consolidated financial statements, the Company’s Debt to EBITDA ratio was 5.3 times and the EBITDA to Interest ratio was 2.2 times, primarily due to the lower oil prices that impacted the Company’s EBITDA generation. Failure to comply with the incurrence test covenants does not trigger an event of default. However, this situation may limit the Company’s capacity to incur additional indebtedness, as specified in the indenture governing the Notes. Incurrence covenants as opposed to maintenance covenants must be tested by the Company before incurring additional debt or performing certain corporate actions including but not limited to dividend payments, restricted payments and others, (other than in each case, certain specific exceptions). As of the date of these interim condensed consolidated financial statements, the Company is in compliance of all the indenture’s provisions.

 

(b) During March 2014, GeoPark executed a loan agreement with Itaú 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. 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%. As a result of the above, in March 2016 the Company paid US$ 10.000.000 corresponding to principal payments under the current principal amortization schedule.

 

The facility agreement includes customary events of default, and requires the Brazilian subsidiary to comply with customary covenants, including the maintenance of a ratio of net debt to EBITDA of up to 3.5x for the first two years and up to 3.0x thereafter. The credit facility also limits the borrower’s ability to pay dividends if the ratio of net debt to EBITDA is greater than 2.5x. As of the date of these interim condensed consolidated financial statements, the Company has complied with these covenants

 

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GEOPARK LIMITED

31 MARCH 2016

 

Note 11 (Continued)

 

Borrowings (Continued)

 

(c) During December 2015, GeoPark executed a loan agreement with Banco de Chile for US$ 7,028,000 to finance the start-up of new Ache gas field in GeoPark-operated Fell Block. The interest rate applicable to this loan is LIBOR plus 2.35% per annum. The interest and the principal will be paid on monthly basis; with a six months grace period, with final maturity on December 2017.

 

(d) During February 2016, GeoPark executed a loan agreement with Banco de Crédito e Inversiones for US$ 186,000 to finance the acquisition of vehicles for the Chilean operation. The interest rate applicable to this loan is 4.14% per annum. The interest and the principal will be paid on monthly basis, with final maturity on February 2019.

 

As of the date of this interim condensed consolidated report, the Group has available credit lines for over US$ 41,000,000.

 

Note 12

 

Provisions and other long-term liabilities

 

The outstanding amounts are as follows:

 

Amounts in US$ '000

At

31 March 2016

Year ended

31 December
2015

Assets retirement obligation and other environmental liabilities 32,774 31,617
Deferred income 4,884 5,033
Other 6,130 5,800
  43,788 42,450

 18

GEOPARK LIMITED

31 MARCH 2016

 

Note 13

 

Trade and other payables

 

The outstanding amounts are as follows:

 

Amounts in US$ '000

At

31 March 2016

Year ended

31 December
2015

Trade payables 24,840 25,906
Payables to related parties (1) 21,456 21,045
Customer advance payments (2) 10,000 -
Taxes and other debts to be paid 2,794 8,197
Staff costs to be paid 7,792 6,702
V.A.T. 520 908
To be paid to co-venturers 6,741 113
Royalties to be paid 805 2,475
  74,948 65,346

 

Classified as follows:

 

Current 49,392 45,790
Non-Current 25,556 19,556

 

(1)Corresponds to related parties loans granted by LGI. The maturity of these loans is July 2020 and the applicable interest rate is 8% per annum.

 

(2)In December 2015, the Company entered into a prepayment agreement with Trafigura under which the Company sells and deliver a portion of its Colombian crude oil production. The agreement also provides GeoPark with prepayment of up to US$ 100.000.000 from Trafigura. Funds committed are available upon request and will be repaid by the Company on a monthly basis through future oil deliveries over the period of the contract, which is 2.5 years, including a 6-month grace period. As of the dates of these Financial Statements, outstanding amounts related to the prepayment agreement amount to US$ 10.000.000.

 

Note 14

 

Subsequent events

 

In April 2016, to secure a portion of its cash flow, the Company agreed with Trafigura to fix the reference sales price (Brent) for a portion of the Colombian production at US$45/bbl (before considering quality and transportation discounts). This fixed reference price applies for a period of three months starting 1 May 2016 and applies to a production of 4,000 bopd, representing approximately 20% of current consolidated production.

 

 

 

 19

GEOPARK LIMITED

31 MARCH 2016

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

    GeoPark Limited
     
     
      By: /s/ Andrés Ocampo
        Name: Andrés Ocampo
        Title: Chief FinancialOfficer

Date: May 9, 2016