RPC(US:RES)2024-07-25 19:14Financial Performance - Total revenues for Q2 2024 were $364.2 million, a decrease of $51.7 million or 12.4% compared to Q2 2023, primarily due to lower pressure pumping activity and competitive pricing [104]. - Income before income taxes for Q2 2024 was $39.4 million, down from $85.6 million in Q2 2023, with diluted earnings per share at $0.15 compared to $0.30 in the prior year [107]. - Cost of revenues decreased to $262.3 million in Q2 2024 from $265.8 million in Q2 2023, reflecting reduced expenses aligned with lower activity levels [105]. - Selling, general and administrative expenses fell to $37.4 million in Q2 2024 from $43.6 million in Q2 2023, mainly due to lower variable expenses and legal costs [106]. - Technical Services segment revenues decreased by 17.1% to $62.2 million for the first six months of 2024, down from $180.6 million in the same period of 2023 [130]. - Support Services segment revenues decreased by 12.7% to $8.0 million for the first six months of 2024, compared to $14.6 million for the same period in 2023 [130]. - Cost of revenues decreased by 5.6% to $538.9 million for the six months ended June 30, 2024, down from $571.0 million for the same period in 2023 [131]. - Selling, general and administrative expenses decreased to $77.5 million for the six months ended June 30, 2024, compared to $85.8 million for the same period in 2023 [132]. - Depreciation and amortization increased by 23.9% to $62.3 million for the six months ended June 30, 2024, compared to $50.3 million for the same period in 2023 [133]. Capital Expenditures - Capital expenditures for the first half of 2024 totaled $129.2 million, with expectations to range between $200 million and $250 million for the full year, focusing on maintenance and growth opportunities [103]. - Capital expenditures were $127.8 million for the six months ended June 30, 2024, compared to $104.5 million for the same period in 2023 [141]. - The Company expects capital expenditures to be between $200 million and $250 million in 2024, focusing on maintenance and growth opportunities [149]. - The company plans to allocate $250 million in expenditures during 2024, primarily for capitalized maintenance of existing equipment and selected growth opportunities [163]. Cash Flow and Dividends - Cash and cash equivalents increased by $38.2 million to $261.5 million as of June 30, 2024, compared to $223.3 million as of December 31, 2023 [139]. - Net cash provided by operating activities increased by $6.9 million to $184.5 million for the six months ended June 30, 2024, compared to $177.6 million for the same period in 2023 [140]. - The Board of Directors declared a quarterly cash dividend of $0.04 per share payable on September 10, 2024 [152]. - The company expects to continue paying cash dividends to common stockholders, subject to industry conditions and financial performance [165]. Market Conditions - The average price of oil in Q2 2024 was $81.78 per barrel, an increase of 11.2% compared to the same period in 2023, while the average price of natural gas was $2.07 per thousand cubic feet, a decrease of 4.2% [117]. - The average domestic rig count for Q2 2024 was 603, a decline of 16.1% compared to Q2 2023 [117]. - International revenues represented 2.9% of total revenues in Q2 2024, up from 1.5% in the same period of the prior year [104]. - International revenues are expected to remain less than 10% of consolidated revenues in the foreseeable future [165]. - The company believes that current and projected prices of oil, natural gas, and natural gas liquids are important catalysts for U.S. domestic drilling activity [165]. - The company anticipates that oil-directed drilling will continue to dominate domestic drilling, while natural gas-directed drilling will remain a low percentage in the near term [165]. Strategic Initiatives - The Company acquired Spinnaker Oilwell Services, LLC on July 1, 2023, expanding its cementing services in key basins [113]. - The company plans to maintain and upgrade its current fleet capacity of revenue-producing equipment while being disciplined about adding new capacity [165]. - The company acknowledges risks related to the volatility of oil and natural gas prices, which could affect drilling activity and demand for its services [166]. - The company is committed to monitoring market trends and environmental concerns that may impact its operations and equipment fleets [165]. Taxation - The effective tax rate for Q2 2024 was 17.8%, down from 24.1% in Q2 2023, primarily due to favorable discrete adjustments [126]. Financial Position - The company has no outstanding interest-bearing advances on its credit facility as of June 30, 2024, which bears interest at a floating rate [167]. - The majority of the company's transactions occur in U.S. currency, minimizing the impact of foreign exchange rate changes on its financial condition [169].