Source: Devon Energy Corp. 

Devon Energy Corp (NYSE:DVN) recently held a conference call with analysts and investors to discuss its second-quarter results. The hour-long call featured a deep dive into the company's results as well as its future plans. Here are the five most important highlights of what management said on the call.

The good times continue to roll

The second quarter was another outstanding one for Devon both operationally and financially as we continued to successfully execute on our strategic plan.
-- CEO John Richels

Devon Energy had four major highlights in the second quarter. It finished the portfolio transformation that it announced late last year by selling the last of its noncore natural gas assets to LINN Energy (OTC:LINEQ). The company also continued to turn its focus to oil and delivered 79% year-over-year U.S. oil production growth. That oil focused growth increased its operating cash flow by 47% over the prior year. And finally, the company completed three major projects -- Jackfish 3, the Access Pipeline, and the Victoria Express Pipelines -- that will help to grow cash flow in future quarters. This is why Richels called the quarter outstanding both operationally and financially.

Aggressive focus on liquids continues

With the aggressive transformation of our North American on shore portfolio, total liquids production is expected to approach 60% of Devon's go forward production by year-end, and that's up from just over 30% a few years ago.
-- John Richels

Last quarter 43% of the company's production was natural gas, however, natural gas only accounted for 27% of the company's revenue. By focusing on growing its liquids production Devon Energy is earning more money on a barrel of oil equivalent basis. In fact, in just the past year its pre-tax cash margins per barrel of oil equivalent have grown 40% due to the increase in liquids production. Those margins should head even higher as Devon Energy continues to focus on pushing liquids production higher.

Source: Devon Energy Corp. 

Laser focused on operational improvements

Our solid execution in the quarter resulted in strong oil production growth driving an impressive increase in our operating cash flow. We are laser focused on the key drivers of outstanding operational performance, including driving down drilling times, optimized completion designs and very efficient production operations. Continuous improvement in each of these areas and others will provide incremental value in each of our operating areas.
-- COO Dave Hager

Devon Energy is laser focused on improving its operations because it is yielding real results. One example of this is seen from optimizing its completion designs in the Cana-Woodford, which included a new completion design that has nearly doubled the amount of frac stages and sand used in each well. This enhancement is paying off: 

Source: Devon Energy Corp Investor Presentation 

As the above slide demonstrates, well costs are in-line with expectations, however, the company has improved its 30-day initial production rates by 35% while also improving its estimated ultimate recovery per well by 15% -- both of which really improve the company's returns as it can create more value per dollar invested.

The Eagle Ford shale is better than expected

We could not be more pleased with the performance we have seen from this world-class asset. And we have already identified several promising opportunities that can further enhance well economics and boost our drilling inventory.
-- Dave Hager

Last quarter, the Eagle Ford Shale produced 65,000 barrels of oil per day, or BOE/d, which was in-line with expectations. This was despite the fact that 8,000 BOE/d of production was constrained due to issues with a third-party gathering system. This strong production is enhanced by the fact that it carries margins of $60 per BOE, which is the best in its portfolio and nearly double the $30.47 per BOE margins the company delivered as a whole last quarter. On top of that the company now sees upside opportunities in the upper Eagle Ford, which wasn't an area it ascribed any value to when it acquired its position.

Key takeaways from the CEO

Let me leave you with a few key takeaways from today's call. First, we have dramatically improved our portfolio in a short period of time. Devon emerges with a formidable portfolio that's on track to deliver attractive high margin production growth for many years to come. As evidenced by our second quarter results, our pursuit of high margin production is significantly expanding our margins and profitability. And finally the commitment to our top strategic objectives that you heard us talk about often, which is to optimize long-term growth and debt adjusted cash flow per share has never been stronger. As we deliver on our growth expectations we are poised to create significant value for our shareholders in the upcoming years.
-- John Richels

Bottom line here, Devon Energy is in the best position it's ever seen and only expects to get stronger as it continues to develop its assets and grow production that creates value for investors.