Encana (NYSE:ECA) announced its first-quarter results before the opening bell today. The company reported operating earnings of $515 million, or $0.70 per share. That's 192% higher than last year's first quarter and $0.18 per share higher than analysts were expecting.

Encana enjoyed strong first-quarter operating performance that was highlighted by a surge in liquids volumes. The company's liquids production was up 56% year-over-year to 67,900 barrels per day. The company's focus on growing its liquids volumes led to a 2% decline in its natural gas volumes. However, a 37% increase in natural gas prices provided a big boost to Encana's bottom line.

Surging liquids production and higher realized commodity prices also fueled growing cash flow for Encana. The company's cash flow totaled $1.1 billion, or $1.48 per share in the first quarter. That's 87% higher than last year's first quarter.

Encana's turnaround plan saw it complete several significant transactions since its launch in November of last year. The company sold off a number of U.S.-based natural gas assets while it most recently acquired a position in a top U.S. liquids play, the Eagle Ford. These transactions, combined with a focus on spending 80% of its capital budget on its five core liquids play, is providing a noticeable boost to the company's profitability.

The company's strong first-quarter results demonstrate that it is making progress on its strategy to transform its business from a focus on natural gas to liquids. Further, CEO Doug Settles noted in the company's press release that it "continues to build momentum in our core growth areas," which is accelerating the company's transition to a more balanced portfolio.

Matt DiLallo has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.