RPC(RES) - 2024 Q2 - Quarterly Results

Financial Performance - Revenues for Q2 2024 were $364.2 million, a decrease of 4% sequentially, with pressure pumping revenues declining by 17%[3] - Net income increased by 18% sequentially to $32.4 million, resulting in a diluted EPS of $0.15 and a net income margin of 8.9%, up 160 basis points[3] - Adjusted EBITDA rose to $68.5 million, a 9% increase sequentially, with an adjusted EBITDA margin of 18.8%, up 210 basis points[3][7] - Revenues for Q2 2024 were $364.2 million, compared to $377.8 million in Q1 2024, reflecting a decrease in overall sales[31] - Adjusted EBITDA for Q2 2024 was $68.5 million, with an adjusted EBITDA margin of 18.8%, up from 16.7% in Q1 2024[31] - Operating income for Q2 2024 was $35.5 million, up from $32.3 million in Q1 2024, but down from $82.4 million in Q2 2023[42] - Net income for Q2 2024 was $32.4 million, compared to $27.5 million in Q1 2024 and $65.0 million in Q2 2023, reflecting a year-over-year decline of 50%[42] - Basic and diluted earnings per share for Q2 2024 were both $0.15, an increase from $0.13 in Q1 2024 but down from $0.30 in Q2 2023[42] Cash and Dividends - The company maintained a strong balance sheet with over $260 million in cash and no debt, while paying $8.6 million in dividends during Q2 2024[4][8] - Year-to-date dividend payments totaled $17.2 million, with a quarterly cash dividend of $0.04 per share declared for September 2024[9] - The company reported a net cash increase of $38.2 million for the quarter, ending with cash and cash equivalents of $261.5 million[17] - Cash and cash equivalents rose to $261.5 million from $223.3 million at the end of 2023, indicating a 17.1% increase[43] - Free cash flow for the six months ended June 30, 2024, was $56.7 million, down from $73.1 million for the same period in 2023[28] - Free cash flow for the same period was $56.7 million[56] Market and Operational Insights - The decline in pressure pumping revenues was attributed to lower asset utilization in a competitive market, while downhole tools and coiled tubing services saw an 8% increase due to new product innovations[5] - Coiled tubing services experienced double-digit growth, indicating strong demand in that segment[32] - RPC is optimistic about the impact of newly launched downhole tools and is assessing opportunities for specialized work in coiled tubing[13] - The company is evaluating future investments to enhance its asset base in response to competitive pressures in the pressure pumping market[32] - The average U.S. rig count decreased to 603 in Q2 2024, down 3.2% from 623 in Q1 2024 and down 16.1% from 719 in Q2 2023[52] - Oil prices averaged $81.78 per barrel in Q2 2024, up 5.6% from $77.46 in Q1 2024 and up 11.2% from $73.54 in Q2 2023[52] Expenses and Cost Management - Selling, general and administrative expenses decreased to $37.4 million from $40.1 million, primarily due to reduced headcount and lower incentive compensation accruals[34] - Cost of revenues for Q2 2024 was $262.3 million, down from $276.6 million in Q1 2024, primarily due to lower fuel and material costs[53] - The income tax provision for Q2 2024 was $7.0 million, representing 17.8% of income before income taxes, a decrease from 23.4% in Q1 2024[54] Strategic Initiatives - The company is exploring long-term strategic investments and potential acquisitions to grow its business and scale[4][13] - RPC's President expressed optimism about newly launched products contributing to future growth in downhole tools[32] - The company upgraded its equipment with a Tier 4 dual-fuel fleet during Q2 2024, aiming to transition towards dual-fuel or electric equipment[32] - Non-GAAP adjustments in 2Q:24 included only those necessary for calculating EBITDA and Adjusted EBITDA[55] Investor Relations - RPC, Inc. will hold a conference call to discuss Q2 2024 results, indicating ongoing engagement with investors[39] - Net cash provided by operating activities was $184.5 million year-to-date through 2Q:24[56] - No share repurchases were executed in 2Q:24[57] - Support Services includes equipment rental tools and pipe inspection services[58]