EQT Corporation sees FY19 adjusted free cash flow of $300M-$400M
EQT Corporation announced that it has released an investor presentation outlining its ongoing strategic plan to drive cost reductions across the business and generate sustainable free cash flow growth. EQT appointed four new independent directors in November of 2018. The Board established an Operating and Capital Efficiency Committee in December; Committee members have strong reputations as efficient operators and substantial financial expertise. New Team: EQT's management team includes a new CEO, CFO, General Counsel and Head of IR. COO Gary Gould will assume his role in April. EQT is achieving the operational targets set out for the first quarter of 2019. The company has made significant progress across drilling and completion operations. Highlights include approximately 90% of wells drilled over 12,000 feet on-time and on-budget and a 35% improvement in stages per crew per month. Stabilized operations and sustained focus on operational efficiencies are expected to continue driving improvements throughout 2019. Cost reductions: EQT has already implemented cost saving actions that reduced annual cash costs by approximately $150M. This includes approximately $50M of annual cost savings under EQT's "Target 10% Initiative," which aims to reduce cash costs by 10%. Continued successful execution of this initiative is expected to yield cost savings of $800M over the next five years, $250M of which has already been identified. EQT delivered approximately $134M of adjusted free cash flow in the fourth quarter of 2018, above prior guidance. These strong results underscore EQT's focus on enhancing operational efficiency to drive accelerated cash flow growth and shareholder value creation. EQT's strong operational performance underpins the company's confidence in its financial forecast. EQT anticipates generating adjusted free cash flow of approximately $300M-$400M in 2019 and $2.9B over the next five years, up from the $2.7B announced in January - with the company's ongoing target 10% Initiative providing incremental upside. EQT expects first quarter 2019 sales volumes to come in at the high-end of the guidance range of 360-380 Bcfe while anticipating first quarter 2019 capital expenditures in-line with expectations. This supports the ongoing operational and capital efficiency efforts implemented by senior management.