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Frontera Energy Corp (FEC) reported a disappointing fourth quarter for 2024, with earnings per share (EPS) of -$0.36, missing the forecast of $0.57. Revenue reached $213.65 million, but the market reacted negatively, with shares dropping 3.9% in pre-market trading. According to InvestingPro data, the company maintains a healthy gross profit margin of 43.6% and trades at an attractive P/E ratio of 3.85. The company also provided insights into its strategic direction for 2025, including production and capital expenditure targets.
Key Takeaways
- Frontera Energy reported a net loss of $24.2 million for 2024.
- The company missed EPS expectations significantly, with a -$0.36 EPS versus a $0.57 forecast.
- Shares dropped 3.9% following the earnings release.
- Production targets for 2025 are set at 41,000-43,000 BOE per day.
- The company plans to reduce development capital expenditure by $18 million in 2025.
Company Performance
Frontera Energy’s performance in 2024 was marked by a net loss of $24.2 million, translating to an EPS of -$0.29 for the full year. Despite the loss, the company managed to generate strong cash flows from operations, amounting to $510 million. The company also met its financial guidance targets, emphasizing its focus on cost efficiency and production optimization.
Financial Highlights
- Revenue: $213.65 million for Q4 2024
- Full-year net loss: $24.2 million or $0.29 per share
- Operating EBITDA: $424 million, in line with guidance
- Cash flows from operations: $510 million
- Year-end cash position: $223 million
Earnings vs. Forecast
Frontera Energy’s Q4 2024 EPS of -$0.36 fell short of the expected $0.57, representing a significant negative surprise. This miss is notable compared to previous quarters where the company has generally met or exceeded expectations.
Market Reaction
Following the earnings announcement, Frontera Energy’s stock fell by 3.9%, from a last close value of $6.67. This decline reflects investor disappointment in the earnings miss and the overall financial performance for the quarter. InvestingPro analysis indicates the stock is currently in oversold territory based on RSI, with additional ProTips available to subscribers. Trading near its 52-week low with a remarkably low Price/Book ratio of 0.19, the stock shows potential value signals. The company also offers a dividend yield of 3.75%, providing some compensation for patient investors during this challenging period.
Outlook & Guidance
For 2025, Frontera Energy has set a production target of 41,000-43,000 BOE per day, a 4% increase from 2024. With a current market capitalization of $343.17M and last twelve months EBITDA of $420.17M, the company aims for consolidated operating EBITDA of $370-$415 million and expects free cash flow of $80-$125 million, assuming Brent crude prices at $75 per barrel. Discover more detailed financial analysis and 12+ additional ProTips with InvestingPro, including exclusive access to comprehensive Pro Research Reports covering 1,400+ top stocks. Capital expenditure is projected to be between $160-$190 million, with a focus on high-impact exploration wells.
Executive Commentary
CEO Orlando Cabrales emphasized the company’s strategic focus, stating, "We have a fully funded plan for 2025, delivering approximately $370 million to $415 million in consolidated operating EBITDA." CFO Rene Burgos Diaz highlighted the importance of capital allocation, noting, "Capital allocation is the Board’s remit."
Risks and Challenges
- Fluctuating oil prices could impact revenue and profitability.
- Execution risks associated with production and exploration targets.
- Potential challenges in divesting the infrastructure business.
- Foreign exchange risks, partially mitigated by hedging strategies.
- Competitive pressures within the energy sector.
Q&A
During the earnings call, analysts inquired about the company’s capital allocation strategy and the efficiency of reduced capital expenditure. The management confirmed their hedging strategy and discussed the pending sale of their infrastructure business, which remains in final stages.
Full transcript - Frontera Energy Corp (FEC) Q4 2024:
Ina, Conference Facilitator: Good morning. My name is Ina, and I’ll be your conference facilitator today. Welcome to Frontera Energy’s Fourth Quarter and Year End twenty twenty four Operating and Financial Results Conference Call. All lines are currently on mute to prevent any background noise. I would like to remind you that this conference call is being recorded today and is also available through audio webcast on the company’s website.
Following the speakers’ remarks, there will be time for questions. Analysts and investors are reminded that any additional questions can be directed to Frontera following today’s call at irfronteraenergy.ca. This call contains forward looking information within the meaning of applicable Canadian securities laws relating to activities, events or developments the company believes or expects will or may occur in the future. Forward looking information reflects the current expectations, assumptions and beliefs of the company based on information tricky available to it. Although the company believes the assumptions are reasonable, forward looking information is not a guarantee of future performance.
Forward looking information is subject to a number of risks and uncertainties that may cause the actual results of the company to differ materially from those discussed in the forward looking information. The company’s MD and A for the quarter ended 12/31/2024 and the company’s annual information form dated 03/10/2024 and other documents it files from time to time with securities regulatory authorities describe the risks and uncertainties, material assumptions and other factors that could influence actual results. Any forward looking information speak only as of the date on which it is made. The company disclaims any intent or obligation to update any forward looking information except as required by law. I would now like to turn the call over to Mr.
Gabriel De Alba, Chairman of the Board of Frontera Energy. Mr. De Alba?
Gabriel De Alba, Chairman of the Board, Frontera Energy: Thank you, operator. Good morning, everyone, and welcome to Frontera’s fourth quarter twenty twenty four and year end operating and financial results conference call. Joining me on today’s call are Orlando Cabrales, Frontera’s CEO Rene Burgos Diaz, Frontera’s CFO. And also available to answer questions at the end of the call, we have Victor Vega, VP, Field Development, Reservoir Management and Exploration Alejandra Bonilla, General Counsel Rivan Aribalo, VP, Operations and Renata Campanero, VP, Marketing and Logistics and Business Sustainability. Thanks again for joining us.
In 2024, Frontera continued to demonstrate robust performance, focused on the execution of the strategic objectives and priorities. The company met its guidance targets, including key upstream operating and financial objectives and delivered on its commitment to return capital to shareholders. The value center approach resulted in closing the year with a strong balance sheet including $223,000,000 cash position. The company also lowered its consolidated debt and lease liabilities by over $30,000,000 During the year, both S and P and Fitch reaffirmed the company’s credit ratings of P plus and B respectively with a stable outlook, highlighting Frontera’s strong credit quality and financial position, underpinning the company’s low leverage. For the full year, the infrastructure business segment delivered strong results, generating a 2024 adjusted infrastructure EBITDA of over $107,000,000 at the midpoint of the company’s 2024 guidance target.
The company also received over $60,000,000 in dividends and capital distributions from ODL. Frontera continues to make significant progress in its Puerto Vallarta operations, reaching several key important milestones, which we expect shall provide shareholders with significant upside potential, including the construction of the connection line with the Refineria de Cartagena, which is expected to be operational by the second quarter of twenty twenty five. Additionally, the company announced the new LPG joint venture with Industrious Gasco. All these projects are strategic for Frontera but also supported regionally and for the Colombian economy as a whole. As mentioned during the December operational update, the infrastructure business strategic review is in its final stages.
The company is analyzing various options and expects to announce results soon. In the Guyana exploration business, Frontera and its joint venture partner remain firmly of the belief that its interest in and the license of the quarantine block remain in place and in good standing. The joint venture is assessing all legal options available to assert its rights. The joint venture is committed to properly resolving this matter and continuing its multi year efforts and investments to realize value for the people of Guyana and its shareholders from the current time block. Frontera delivered on its commitment to return capital to shareholders.
Supported by Frontera’s strong financial position, from 2024 through today, we have returned approximately $83,000,000 including $15,100,000 in declared dividends, $7,800,000 through the repurchase of its common shares through its NCIB and completing two successful substantial issuer bids for over $60,000,000 The SIB saw an over 90% combined participation rate, validating the company’s capital distribution strategy. Since 2022, the company has returned over $180,000,000 to its shareholders through normal course issuer bids, substantial issuer bids and dividends. Frontera will continue to consider future investor initiatives in 2025, including potential additional dividends, distributions or bond buybacks based on oil prices, the raw results of our business, cash flow generation and the delivery of the strategic goals. I’d now like to turn the call over to Orlando Cabrales, Frontera’s CEO and Rene Burgos, Frontera’s CFO, who will share their views on our fourth quarter and full year results.
Orlando Cabrales, CEO, Frontera Energy: Orlando? Thank you, Gabriel. Good morning, everyone, and thank you for joining us for today’s call. 2024 was a strong financial and operational year for Frontera. We have continued to execute our strategy and generated positive results, meeting all our guidance metrics for the year and deliver additional value to shareholders.
In our Colombian upstream business, we met our 2024 production target after completing successful drilling campaigns in CP6 and Salanero Blocks, expanding water handling capacity to 360,000 barrels in CP6 Block, which reached another record daily production level of close to 9,000 BOE per day in the fourth quarter. And in Sabanero, where production reached approximately 2,400 BOE per day during the same period. At our Zara project, water processing volumes reached an average of 79,000 barrels of water per day in the fourth quarter and an average for the year of forty four thousand barrels of water per day. Frontera continues to optimize its ARR operations
Rene Burgos Diaz, CFO, Frontera Energy: in an
Orlando Cabrales, CEO, Frontera Energy: effort to drive higher water handling and crude oil production volumes and also as a tool to achieve our sustainability and green circular economy goals. I’m also pleased with our continued efforts to manage our cost structure. Despite inflation and other pressures, we met all our cost guidance targets, including the production cost per barrel, which averaged $9.34 per barrel. On our twenty twenty four year end reserves, we continue our commitment to sustain production and focus on value over volume in Colombia and Ecuador, closing the year with 146,000,151,300,000 barrels of 1P and 2P reserves, respectively. Our three year average gross reserves replacement ratio of 60% for 1P reserves and 40% for 2P reserves and presented a reserve life index of six point eight years for 1P reserves and ten point three years for 2P reserves.
The net present value before tax discounted at 10%. Our NPV10 for 12/31/2024, of our 2P reserves was BRL3.4 billion or BRL21.6 billion per BOE. The MPV10 presented a small decrease, mainly due to the reserves decrease. However, the MPV10 per barrel increased year over year, driven by operational efficiencies, optimization of development plans and the reduction of future development costs. For 2025, we will invest between $30,000,000 and $40,000,000 in exploration opportunities, led by the drilling of our high impact Ira 1 exploration well in the B1 Block, originally postponed from our 2024 plan.
We believe our Neofuel exploration and exploration targets will help unlock reserves growth potential. In our infrastructure business, ODL transported over 243,000 barrels per day, generating $274,000,000 in 2024 EBITDA and returning over $171,000,000 to its shareholders. The company received over $60,000,000 from its 35% interest in 2024. Puerto Vallarta generated approximately $15,000,000 in operating EBITDA for 2024, in line with our 2024 guidance. Despite lower than expected Liquids and Cargo volumes and supported by effective cost controls in the operation.
For 2025, our focus in Porto Arie shifts to the connection as we look forward to a start up and ramp up of volumes via the Reficar connection. Turning to our year to date 2025 performance, gross production through March 9 was approximately 40,400 barrels per day. Below our guidance range, mainly due to certain unexpected well failures within our light and medium assets. These issues are being addressed, and we remain confident in meeting our 2025 production guidance. On the exploration side, the Greater Norte 1 well was drilled and the well is currently in evaluation phase.
We remain focused on executing our recently announced capital and production plan for 2025 and continuing to deliver sustainable production, solid operational and financial results and enhancing investor returns. I would now like to turn the call over to Rene Burgos, Frontera’s CFO.
Rene Burgos Diaz, CFO, Frontera Energy: Thank you, Rolando, and good morning, everybody. Would like to take a moment to highlight a few key financial aspects of our full year results. For the full year, the company recorded a net loss of $24,200,000 or $0.29 per share. The company’s net loss includes roughly $117,000,000 of operating income and $54,000,000 from Sherwinkel and Associates’ prior OIBDA investment, offset primarily by approximately $93,000,000 in deferred income tax expense and $74,000,000 in finance expenses. Our deferred income tax expense balance reflect our use of historical tax loss balances, impacts of changes associated with the surtax rate and fluctuations in the Colombian peso tax rate.
Our operating EBITDA for the year was approximately $424,000,000 in line with the 03/2004 guidance. I will take a moment to talk about our key per barrel indicators associated to our realized prices and cost. During the year, our weighted average brand sales price was $79.33 The company also witnessed an average fiscal twenty differential on export sales of $5.51 Our purchased crude net margin associated to our dilution in transportation programs was $2.73 higher than the $2.23 for the prior quarter. The quarter over quarter variance was a result of higher dilution needs driven by higher production from Borinquennial assets. Taking a close look into our operating costs, our production, energy and transportation costs per barrel for the year totaled $9.34 5 point 1 1 dollars and $11.3 for 2023.
The increase in year over year total cost. The first quarter results of higher oil storage activity as well as the impact of asset freight and first time printers on services and bakers. Energy costs are also higher, mainly related to higher heavy crude oil production levels and higher electricity prices. The production costs had a slight increase as a result of annual increased tariffs, partially offset by lower volumes reported primarily attributed to improved domestic wellhead sales. On our infrastructure business, adjusted infrastructure EBITDA for the year was $107,000,000 This compared to $110,000,000 in 2023.
The year over year decrease was primarily due to lower EBITDA from OBL, which resulted from higher costs due to inflationary pressures and indexation on wages. Polio volumes exported were 244,000 barrels per day, consistent with twenty twenty three volumes. Frantaire cast generation for the year was very strong. Our cash flows from operations totaled $510,000,000 This was due to a healthy Brent oil price environment during the year, a reduction in domestic withholding tax rates, the impact of our deferred tax asset recoveries as well as dividends and capital distributions from our investment in the OREO pipeline. As of 12/31/2024, the company closed with a $63,000,000 income tax receivable, which we expect to recover during 2025.
With respect to our capital expenditures, total CapEx for the year was met with our guidance at $218,000,000 dollars Our CapEx for the year included the drilling of $68,000,000 in wells in the Kifa, CP6, Sabanero and Perico blocks, as well as two exploration wells in Colombia. As of 12/31/2024, the company closed the year with a total cash position of $223,000,000 including $193,000,000 ownership cash. This was before the January FID of $30,000,000 In addition, 2024, the company also reduced its consolidated balances by approximately $30,000,000 Turning now to risk management. Our current risk management strategy continues to show how our hedging discipline supports our operations and planning. Frontera uses derivative instruments to measure exposure to oil prices and fixed volatility.
On the oil side, the company entered into hedges, successfully securing a 40% hedging ratio until June 2025 at a 70 Brent strike price, focusing against a potential drop in home prices. Centrajos entered into foreign exchange rate hedges totaling $180,000,000 covering roughly 40% of the company’s expected peso exposure until the third quarter of twenty twenty five. These puts have strikes between the MXN 4 1 50 and MXN 4 2 Both these hedges provide the company with cash flow visibility and help mitigate impacts on future fluctuations, while allowing the business to deliver on its 2025 targets. Finally, I’d like to provide an update on our investor value initiatives. On bond buybacks, the company reduced repurchased $5,000,000 notional of its 2028 senior unsecured notes in 2024.
Year to date, in 2025, the company has repurchased an additional $1,000,000 of its 2028 unsecured notes. Under the company’s NCIB program that expired on 11/20/2024, the company repurchased approximately 1,300,000.0 common shares for $7,800,000 As mentioned in our press release, the company intends to file with the DSX a notice of intention to commence a normal course issuer bid for its common shares. This program will be subject to the acceptance of the TSX. We expect our quarterly dividend from the declared and paid of approximately $15,100,000 during the year for a total of CAD 0.25 per share Canadian to shareholders. Together with this results announcement, the Board has declared a quarterly dividend of CAD 0.625 per share, payable to shareholders of record as of 04/02/2025 and to be paid on or around 04/16/2025.
Regarding the company’s substantial issuer bids or SABs, the company announced two SABs in 2024 for a total of over $60,000,000 at a fixed price of CAD 12 per share. The SABs were widely participated with an over 90% combined participation rate. The company believes this format is the most efficient means to distribute capital to all of our shareholders. In total, the company has returned over $83,000,000 in capital to shareholders since 2024. Fincera shall continue to consider future investor initiatives for 2025 and onwards, including potential additional dividends, distributions, urban buybacks based on our prices, the overall results of our businesses, cash generation and the company’s GAAP goals.
I would now like to turn the call back to Orlando.
Orlando Cabrales, CEO, Frontera Energy: Thank you, Rene. I wanted to provide some color to our 2025 production and capital program. We have a fully funded plan for 2025, delivering approximately $370,000,000 to $415,000,000 in consolidated operating EBITDA at $75 operating prices. Our plan will leverage our transportation and logistics structure to maximize realized prices, while also investing for future growth through facilities expansion and near field and high impact exploration. We expect to generate consolidated free cash flow of approximately $80,000,000 to $125,000,000 at 75 average Brent prices.
Despite lower expected oil prices, Frontera projects, strong cash flow generation, driven by higher production, lower capital expenditures and a focus on cost control. In our Colombian, an Ecuador upstream business, we are targeting production of approximately 41,000 to 43,000 BOE, a 4% increase compared to 2024 production and generate $350,000,000 to $380,000,000 in upstream operating EBITDA. We will invest between $160,000,000 to $190,000,000 in development activities and $18,000,000 decrease in development spending from 2024. We will also invest between $13,000,000 to $14,000,000 in exploration activities and a $10,000,000 to $15,000,000 other investments related to HEC activities and new fuel production technologies. We will focus our drilling efforts on the most productive and profitable assets in the portfolio, building on the successful heavy asset drilling campaign in 2024 in the Kifa and CP6 blocks, supplement our drilling activities with our low cost well intervention program, partially offsetting our natural decline as well as invest in development facilities, primarily supporting activities in the Kefa and CP6 drugs.
On exploration side, we anticipate investing $30,000,000 to $40,000,000 drilling the high impact Ibera 1 exploration well in the BIM1 Block, the Ibera 1 well in the Janos 99 Block and carry out pre seismic and pre drilling activities in the Beam 46 Block. We expect our upstream business to generate free cash flow between $65,000,000 to $95,000,000 inclusive of $10,000,000 to $15,000,000 in cash tax payments, net of recoveries and debt service of $45,000,000 to $55,000,000 which includes $32,000,000 of bond interest and $13,000,000 to $23,000,000 related to debt service for local bank facilities. For our growing and stand alone infrastructure business, we are targeting an infrastructure EBITDA of approximately $20,000,000 to $35,000,000 for 2025, driven by the Reficar connection start up and additional revenues from Saara. Including $50,000,000 to $60,000,000 in distribution from Odeo, the segment is expected to generate free cash flow of approximately $15,000,000 to $30,000,000 We have prepared a slight bridging our current production and the build up of the components supporting our 2025 production targets. Our starting point is the company’s fourth quarter twenty twenty four average daily production rate of 42,400 BOE per day.
Assuming an asset decline rate of between 25% to 30%, To sustain production, the company would need to replace an annual average of 5,500 to 6,500 BOE per day or a rolling of 2% to 3% of production per month. Frontera’s development CapEx program was designed to fully replace our declining barrels via a combination of new wells as well as low cost decline management well interventions, new technologies and a strategic investment in facilities. Our twenty twenty five new well CapEx program seeks to replace between 3,000 to 4,000 barrels, investing between $100,000,000 and $110,000,000 in 60,000,000 to 65 new wells focused primarily on our heavy oil assets. On average, each new well carries an estimated cost of approximately $1,500,000 million dollars to $2,000,000 and targets an annualized production rate between one hundred and one hundred and twenty bureole per day. These wells have an average and attractive on the one year payback period and a capital efficiency metrics of $16,000 to $18,000 per flowing barrel.
Under our low cost decline management well intervention program, the company invests in well interventions and work orders to reduce the impact of the natural decline and optimize the portfolio production rate. For 2025, the company expects to invest approximately $20,000,000 to $30,000,000 in decline management activities with average investment per intervention ranging between 200,000 and 500,000 per well and generating an additional 30 to 40 BOE per day of annualized production. Finally, we plan to invest $15,000,000 to $20,000,000 in strategic projects, including Alsara, Kahua water handling expansion along with between $5,000,000 and $15,000,000 in investments in new technologies to enhance production efficiency and reduce water production and build a foundation for further expansion of these key assets for years to come. Overall, these capital projects will allow us to sustain production from last year at around 40,000 to 43,000 BOE per day. Before I wrap up today’s call, I would like to highlight our sustainability strategy where we achieved 100% of our 2024 sustainability goals.
Frontera restored protected and preserved seven sixty nine hectares of land as well as recirculated 35.2% of its operational water and utilized 43.4% of generated waste. In the health and safety side, Comtea achieved its best total recordable incident rate performance ever with a 6% reduction compared to the previous year. On our efforts to maintain close relationship with all the stakeholders, including our employees and the communities where we operate, we invest approximately $4,100,000 in social projects, benefiting 66,303 people near our operations and increased local purchases from local contractors by 2% compared to last year. As well as in 2024, Ferbera was recognized among the top 20 best companies to work in Colombia by Great Place to Work. We implemented an effective cybersecurity plan, maintaining a zero rate of material cybersecurity incidents.
Additionally, for the fourth consecutive year, Frontera, during 2024, was recognized as one of the most ethical companies by Eddy’s chief. And finally, with that, I would like to conclude by saying thank you to Rianna and Rene for their comments, and thank you, everyone, for attending our call. I will now turn the call back to our operator, who will open up for questions.
Ina, Conference Facilitator: Thank you. Ladies and gentlemen, we will now begin the question and answer session. Your first question comes from the line of Peter Pauley from Jefferies. Please go ahead.
Rene Burgos Diaz, CFO, Frontera Energy: Thank you. Thank you for
Peter Pauley, Analyst, Jefferies: the call and the opportunity for two questions. If it’s okay, I’ll go one by one. The 25 CapEx guidance is down about 25% year on year with it looks like declines year on year in development facilities, other CapEx in Columbia infrastructure. I was just wanted to ask if you could share a little more color on what’s driving those year on year declines, especially given the flattish production year on year? Like is CapEx being spent more efficiently or is the CapEx profile changed significantly versus 2024?
And my second question, is there any level of grant price you would consider reconsider any elements of your CapEx plan or shareholder distributions and buybacks all within the context of your hedges in place? Thank you.
Orlando Cabrales, CEO, Frontera Energy: Thank you, Peter. I can take the first question and you can take the second one. I think on your first question, Peter, I think the answer is our mantra has been value or volumes. Yes, certainly, we are reducing the development CapEx if you compare it with last year. But our production actually is higher this year than last year in our guidance.
So we have been much more efficient in the use of our capital. We are also very much concentrated also in bringing efficiency further, efficiency into our cost structure. And we are focusing this year in developing the drilling campaign for our CP6 new facilities capacity, which was increased last year to 360,000. And so there is room to further optimize the use of that facility, which we already build it last year. And we are also working very hard, as I mentioned in my remarks, to increase production in KeyFa through the Sahara facility, which we are still going to improve there.
So with that in mind, we believe the development CapEx is the right one for the company, and it will allow us to bring that maximum that we have of pallu over volumes with a higher target of production for this year.
Rene Burgos Diaz, CFO, Frontera Energy: Peter, thank you also for your question. As to Brent price, I think we indicated to Brent prices, 75 and 80. 70 5 is the one that we start to plan, where like how sort of highlighted. We have a range of potential free cash flow scenarios between 80 to 100 and 20 5. Our hedges today are through the middle of the year around $70 Brent.
So I think we’re pretty well covered. It will depend how the rest of the year somewhat works out and our ability to actually maximize those hedges for us to somewhat restrike or replan. But for now, I think we’re sticking with the range of potential outcomes. But certainly, if prices continue kind of in a downward trajectory, we will need to kind of adjust our plans or perhaps rethink how our value maximization approach will take. But for now, I think we’re pretty good, pretty covered.
Great. Thank you.
Ina, Conference Facilitator: Thank you. And your next question comes from the line of Christian Farra from KNG Securities. Please go ahead.
Orlando Cabrales, CEO, Frontera Energy: Hello. Can you hear me? Yes. I think we can hear you.
Christian Farra, Analyst, KNG Securities: Thank you. So I have two questions. The first one, if you could please provide some color on the expected shareholder distributions for 2025, including both share repurchases and dividends? And my second question, if you have any news to share regarding the infrastructure business divestment? Thank you.
Orlando Cabrales, CEO, Frontera Energy: Okay. On the I can take Rene the second one and you can take the first one. And on the second one, as we announced it back in May of last year, I mean, we are working diligently to conclude this infrastructure process. We are analyzing various options that we have right now. And we believe that the progress, as I think Gabriel mentioned in his remarks, is closed, is during its final stage.
So we hope to announce something soon. Rene, you can take the first one.
Rene Burgos Diaz, CFO, Frontera Energy: Yes. And thank you, Rolando. Look, color on distributions, I think that we’ve as we laid out in our press release, our distributions are multi pronged. First, we have NCABs, then we have our dividend and then what we’ve done last year is also the substantial issuer bids. I think as far as direction, I think that the you should look at the dividend and the ACIB as a straightforward return in capital.
And the other means of capital distribution, as Gabriel said, will be confirming to overall oil prices, business results, etcetera. So that’s the best guidance that I can share with you right now. And again, last year, we distributed or since 2024, we distributed over $83,000,000 to shareholders. And since 2022, close to $150,000,000 So we’re really key and focused on shareholder distributions. But of course, this year will be no different with us focusing depending upon our business execution.
Christian Farra, Analyst, KNG Securities: Thank you. And if I may, a quick follow-up.
Orlando Cabrales, CEO, Frontera Energy: Do you maybe it’s a
Christian Farra, Analyst, KNG Securities: bit too early, but do you already know what are your plans for the proceeds you’re going to get off the infrastructure business divestment?
Orlando Cabrales, CEO, Frontera Energy: Do you want to take that one?
Rene Burgos Diaz, CFO, Frontera Energy: Yes. Look, I think as we said before in discussions with you all and in these conversations, capital allocation is the Board’s remit. So it really depends at the time and the form. Once this process is finalized, we will the Board will determine the most optimal way for this capital to be distributed. So I guess like Rolando said, we’re nearing the end of the process.
We’re analyzing various options. And as soon as we have better information, we’ll communicate with the market in due course. Thanks.
Ina, Conference Facilitator: Thank you. Your next question comes from the line of Alejandra Andrade from JPMorgan. Please go ahead. Hi. I just wanted to follow-up on the hedges.
When you released guidance, I think only first quarter hedges were in place. I’m just wondering what is the percentage now that is hedged of the first six months of the year?
Orlando Cabrales, CEO, Frontera Energy: Renee, you have that?
Gabriel De Alba, Chairman of the Board, Frontera Energy: Yes, I’ll take
Rene Burgos Diaz, CFO, Frontera Energy: this one. So we’ve had roughly 40% of our net production around $70 Brent.
Ina, Conference Facilitator: The first six months? Okay, perfect. Thank you.
Orlando Cabrales, CEO, Frontera Energy: The first six months, yes.
Ina, Conference Facilitator: Thank you. There are no further questions at this time. I will now hand the call back to Mr. Orlando Cabrales for any closing remarks.
Orlando Cabrales, CEO, Frontera Energy: No, thank you. Thank you, operator. Thank you to Leonardo again. And thank you everyone for attending the call and have a good day.
Ina, Conference Facilitator: Thank you. And this concludes today’s call. Thank you for participating. You may all disconnect.
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