Penn Virginia Corporation (NASDAQ:PVAC) Q4 2019 Earnings Conference Call - Final Transcript
Feb 28, 2020 • 11:00 am ET
Good day, and welcome to the Penn Virginia Corporation Fourth Quarter 2019 Earnings Conference Call. [Operator Instructions] Please note this event is being recorded.
At this time, I'd like to turn the conference over to Clay Jeansonne, Director of Investor Relations. Please go ahead.
Thank you. and good morning, everyone. We appreciate your participation in today's call. I'm joined this morning by John Brooks, Penn Virginia's President and CEO; Rusty Kelley, our Senior Vice President and CFO; and Ben Mathis, our Senior Vice President of Operations and Engineering.
Prior to getting started, I'd like to remind you we will be discussing non-GAAP measures on this call. Definitions and reconciliations of these measures to the most comparable GAAP measure are provided in our fourth quarter and full year 2019 earnings release issued yesterday afternoon, and related presentation posted on our website this morning.
I would also point you to the language in the forward-looking statements section of the press release. Our comments today will contain forward-looking statements within the meaning of the federal securities law. These statements, which include, but are not limited to, comments on our operational guidance are subject to a number of risks and uncertainties that could cause actual results to be materially different from those forward-looking statements, including those identified in the Risk Factors in our most recent Annual Report on Form 10-K. Cautionary language is also included on Page 1 of the presentation, which we will use to go through today's discussion.
Also during this call, we will also be referencing third-party data and consensus estimates. Please note that we are not endorsing or confirming any of these consensus estimates or public data of our peers in this presentation. Finally, after our prepared remarks, we will answer any questions you may have.
With that, I will turn the call over to John.
John A. Brooks
Thanks, Clay. First of all, I want to congratulate the entire Penn Virginia team and express my gratitude for their relentless efforts to deliver a great fourth quarter highlighted, first of all, by generating free cash flow, record low operating expenses, peer-leading margins and continued improvement in our leverage ratio. Importantly, we also added in some timely hedges that along with our robust operational results, we believe, uniquely positions Penn Virginia in our industry. The strength of our balance sheet, our strong hedge positions and the short-term nature of our drilling and completion contracts enable us to respond to a sustained lower commodity price environment as we maintain our focus on exercising capital discipline.
So, let's start on Page 3 with why we believe Penn Virginia is solidly positioned for continued success and provides a compelling investment opportunity. We are heavily weighted to oil as evidenced by our fourth quarter 2019 production mix, which was 76% oil, and we expect that trend to continue throughout 2020. Our successful efforts to continue lowering operating costs, coupled with premium product pricing given our strategic location near the Gulf Coast are driving industry leading margins. And through our