Magnum Hunter Resources (OTC:MHRCQ) has been on a role of late. Over the past three months the company has delivered its much delayed annual report, its first-quarter earnings, and just last week brought investors completely up to date by filing its second-quarter earnings report. With its second-quarter numbers out, let's take a look at some of the report's highlights to get the clearest picture of where the company is right now.

Financial highlights
Magnum Hunter was able to grow its revenue 98% year over year to $84 million thanks to increased oil and gas production. That drove adjusted EBITDAX for the quarter to $38.5 million. However, its bottom line wasn't as good -- the company delivered an adjusted loss of $0.18 per share. At this stage of the game these numbers don't hold a lot of meaning because the company is more focused on growth than profits these days.

Speaking of profits, the company did record a one-time gain on the quarter of $151.3 million, or $0.89 per share, after it closed the sale of its Eagle Ford assets to Penn Virginia (OTC:PVAHQ). That sale marked the latest step in the company's build-to-sell model. Overall, Magnum Hunter was able to book quite the profit on its $400 million sale price for those assets. However, it was also a good deal for Penn Virginia; those acquisitions are much more valuable to it because of the synergies gained from the close proximity to its existing assets.

Production highlights
For the quarter, Magnum Hunter produced 15,942 barrels of oil equivalent per day, or BOE/d. However, the company faced temporary production shut-ins in Appalachia due to pipeline and liquid handling issues. Without these problems, production would have been 12% higher, or 17,814 BOE/d. Even with them, production was still 23% higher than last year. Higher production is the key area for Magnum Hunter right now -- that means it's doing a good job delivering even though it sold its Eagle Ford assets. 

The company was able to resolve all its shut-in issues this past May -- a new pipeline is fully operational and so is Markwest's (UNKNOWN:MWE.DL) Mobley processing plant. The Mobley plant is important as it will enhance Magnum Hunter's ability to get its higher-valued liquids processed. The company should have more than enough takeaway and processing capacity so that shut-ins won't be a problem over the near term.

One thing that investors really do need to notice is that its big problem during the quarter is actually a net positive. The company said that it "experienced higher than anticipated NGLs present in its Marcellus production." That's actually fantastic news because natural gas liquids are worth more than dry natural gas. Overall, this enabled Magnum Hunter's production mix to move to 48% oil and liquids, which is up from 45% last quarter, and which over time will be much better on its bottom line.

A look ahead
Magnum Hunter expects to end the year with a production run rate of 23,000-25,000 BOE/d. That would equate to growth of more than 40% over the balance of the year as the company moves forward on its $300 million upstream capital program. However, it is important to note that most of that production won't come on line until the fourth quarter due to its use of pad drilling. 

The only question is how much longer the company can keep up its pace of growth. It currently has just under $300 million of liquidity, while it is also planning to sell off some more pieces that it's been building through upcoming asset sales. Over the next two years the plan is to sell about $200 million in non-core assets as well as monetize its midstream assets. That should fund its growth over the next few years, but it still leaves a lot of question marks as to what the company will do after that, especially given that the trend within the industry is now to invest within cash flow.

Final Foolish thoughts
Magnum Hunter's capital plan is really starting to deliver results. While those results were held back this quarter due to some infrastructure issues, it was actually positive for Magnum Hunter because it's producing more liquids than it originally thought. However, its liquidity is still pretty tight which means that it has to sell assets to keep growing. That's a riskier model, which many of its peers are finding isn't working.