PDC Energy, Inc. (NASDAQ:PDCE) Q3 2019 Earnings Conference Call Transcript

Nov 07, 2019 • 11:00 am ET

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PDC Energy, Inc. (NASDAQ:PDCE) Q3 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good day ladies and gentlemen and welcome to PDC Energy's third quarter 2019 conference call. [Operator Instructions]

I would like to introduce your host for today's conference Mike Edwards Senior Director of Investor Relations. Sir please begin.

Executive
Michael Edwards

Thank you. Good morning everyone and welcome. On the call today we have Bart Brookman President and CEO; Lance Lauck Executive Vice President; Scott Reasoner Chief Operating Officer; and Scott Meyers Chief Financial Officer. Yesterday afternoon we issued our press release and posted a slide presentation that accompanies our remarks today. We also filed our 10-Q. The press release and presentation are available on the Investor Relations page of our website at pdce.com. I'd like to call your attention to slide two of that presentation and our forward-looking statements as well as to the non-solicitation information. These communications do not constitute an offer to sell or a solicitation of an offer to buy any securities or a solicitation of any vote or approval.

In connection with the proposed SRC transaction PDC filed with the Securities and Exchange Commission a registration statement on Form S-4. That includes a preliminary joint proxy statement of PDC and SRC that also constitutes a preliminary prospectus of PDC. This joint proxy statement/prospectus and other documents that will be filed by PDC and SRC with the Securities and Exchange Commission may be obtained free of charge at each company's website or at the SEC's website which is sec.gov. We will present some non-U.S. GAAP financial numbers today so I'd also like to call your attention to the appendix slides of that presentation where you'll find the reconciliation of those non-U.S. GAAP financial measures.

With that we can get started. I'll turn the call over to our CEO Bart Brookman.

Executive
Barton R. Brookman

Thank you Mike and hello everyone. A strong third quarter. Production was in line with our expectations and for PDC the era of free cash flow generation has begun. Today we will provide several key updates: our commitment to sustained free cash flow our improving capital efficiency and cost structure the balance sheet strength the successful ongoing integration process with SRC Energy. Let me hit some third quarter highlights. The company generated free cash flow of approximately $40 million. This is on a capital investment of 165 million. The spend level is in line with our expectations in our 2019 Capital span is now targeting at or near the low end of our updated guidance range, or 810 million dollars. Production for the quarter 12.7 million barrels of oil equivalent. This is in mind when companies expectations and represents a 26% improvement from the same quarter last year. Production for 2019 is firmly on target for updated guidance range of 48 to 50 million barrels of oil equivalent.

Operationally we continue to make great strides. Drill times in both basins are improving particularly in the Delaware; lifting costs are in check; completion efficiencies for the company are setting records. We spud 30 wells and turned-in-line 47. And as Scott will cover