Montage Resources Corporation (NYSE:MR) Q3 2019 Earnings Conference Call - Final Transcript

Nov 08, 2019 • 10:00 am ET

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Montage Resources Corporation (NYSE:MR) Q3 2019 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Greetings, and welcome to the Montage Resources Third Quarter 2019 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

I would now like to turn the conference over to your host, Mr. Douglas Kris, Vice President of Investor Relations for Montage Resources. Thank you. You may begin.

Executive
Douglas Kris

Good morning and thank you for joining us for the Montage Resources third quarter 2019 earnings conference call. With me today are John Reinhart, President and Chief Executive Officer; Michael Hodges, Executive Vice President and Chief Financial Officer; Oleg Tolmachev, Executive Vice President and Chief Operating Officer; and Matthew Rucker, Executive Vice President Resources, Planning and Development.

If you have not received a copy of last night's press release regarding our third quarter 2019 operating results, you can find a copy of it on our website at montageresources.com.

Today's discussion will highlight the company's operational and financial outperformance in the third quarter. Before we start our comments, I would like to point out our disclosures regarding cautionary statements in our press release and remind you that during this call, Montage management will make forward-looking statements. Such statements are based on our current judgments, regarding factors that will impact the future performance of Montage Resources and are subject to a number of risks and uncertainties, many of which are beyond Montage Resources' control.

Actual outcomes and results could materially differ from what is expressed, implied, or forecast in such statements. Information concerning these factors can also be found in the company's filings with the SEC. In addition, during this call, we do make reference to certain non-GAAP financial measures. Reconciliation to applicable GAAP measures can be found in our earnings release. We expect to file our 10-Q later today, which will be accessible through our website or the SEC's EDGAR system.

I will now turn the call over to John Reinhart, our President and CEO.

Executive
John Reinhart

Thank you, Doug, and thank you to everyone for listening to our call. I am pleased to provide highlights today on the company's continued outperformance in the third quarter of 2019, which includes production once again exceeding guidance, operating cost below guidance, cycle times outpacing our expectations, and capital spending below analysts' consensus expectations. These results continue to demonstrate the operational and commercial expertise at Montage.

The combination of our top tier execution capabilities, high quality assets and optimized development plans are key contributors that are facilitating Montage's transition to free cash flow generation in 2020.

During our Analyst Day earlier this year, the team laid out a plan that focused development within the company's core areas, minimize development risk with optimized pad and well designs and significantly reduce cycle times.

I am pleased to report that not only have we achieved a 34% reduction year-to-date and are spud to first sales cycle times versus 2018, which is actually above the 2019 business plan, but during the third quarter,