Ranger Energy Services(US:RNGR)2024-07-30 20:44Revenue Performance - Revenue for Q2 2024 decreased by $25.1 million, or 15%, to $138.1 million from $163.2 million in Q2 2023[86] - High Specification Rigs revenue increased by $5.1 million, or 7%, to $82.7 million, driven by improved pricing and a 6% increase in average revenue per rig hour to $732[86] - Wireline Services revenue decreased by $30.0 million, or 55%, to $24.5 million, primarily due to a 77% decrease in completed stage counts to 1,700[87] - Total revenue for the six months ended June 30, 2024 decreased by $45.7 million, or 14%, to $275.0 million from $320.7 million for the same period in 2023[99] - High Specification Rig revenue for the six months ended June 30, 2024 increased by $7.3 million, or 5%, to $162.4 million, with an average revenue per rig hour increase of 5% to $725[99] - Wireline Services revenue for the six months ended June 30, 2024 decreased by $47.1 million, or 45%, to $57.3 million, attributed to a 63% decrease in completed stage counts[100] - Processing Solutions and Ancillary Services revenue for the six months ended June 30, 2024 decreased by $5.9 million, or 10%, to $55.3 million, primarily due to declines in coil tubing and snubbing services[101] Income and Expenses - Operating income for Q2 2024 was $7.3 million, down from $11.4 million in Q2 2023, reflecting a decrease of $4.1 million[86] - The company reported a net income of $4.7 million for Q2 2024, down from $6.1 million in Q2 2023[86] - Net income for the six months ended June 30, 2024 decreased by $8.4 million, or 68%, to $3.9 million from $12.3 million for the same period in 2023, primarily driven by reduced activity in Wireline Services and Processing Solutions segments[110] - General and administrative expenses decreased by $0.4 million, or 5%, to $6.9 million, attributed to reduced employee costs[93] - Total operating expenses for the six months ended June 30, 2024 decreased by $31.9 million, or 11%, to $268.2 million from $300.1 million for the same period in 2023[99] - Interest expense, net for the six months ended June 30, 2024 decreased by $0.7 million, or 33%, to $1.4 million from $2.1 million for the same period in 2023[108] - Income tax expense for the six months ended June 30, 2024 decreased by $2.3 million, or 61%, to $1.5 million from $3.8 million for the same period in 2023[109] - General and administrative expenses for the six months ended June 30, 2024 decreased by $2.1 million, or 13%, to $13.6 million from $15.7 million[106] Adjusted EBITDA - Adjusted EBITDA for the three months ended June 30, 2024, decreased by $0.9 million to $21.0 million from $21.9 million for the same period in 2023[117] - High Specification Rigs Adjusted EBITDA increased by $3.1 million to $18.7 million for the three months ended June 30, 2024, driven by a revenue increase of $5.1 million[117] - Wireline Services Adjusted EBITDA decreased by $5.3 million to $0.4 million due to a revenue decline of $30.0 million[118] - Processing Solutions and Ancillary Services Adjusted EBITDA increased by $1.7 million to $7.3 million, attributed to a decrease in cost of services of $1.8 million[119] - For the six months ended June 30, 2024, net income was $19.6 million, compared to $23.4 million for the same period in 2023[122] - Adjusted EBITDA for the six months ended June 30, 2024, was $32.3 million, compared to $33.0 million for the same period in 2023[122] - High Specification Rigs Adjusted EBITDA decreased by $0.7 million to $32.3 million, primarily due to reduced operating levels and elevated labor costs[124] - Wireline Services Adjusted EBITDA decreased by $9.3 million to $0.6 million, primarily due to significant decreases in operating activity within the completions service line[125] - Processing Solutions and Ancillary Services Adjusted EBITDA decreased by $0.8 million to $9.8 million, primarily due to decreased coil tubing revenue[126] Cash Flow and Liquidity - Net cash provided by operating activities decreased by $6.8 million to $34.1 million for the six months ended June 30, 2024 compared to $40.9 million for the same period in 2023[130] - Net cash used in investing activities increased by $12.1 million to $20.3 million for the six months ended June 30, 2024 compared to $8.2 million for the same period in 2023[132] - Total liquidity as of June 30, 2024 was $72.2 million, consisting of $8.7 million in cash and $63.5 million available under the Wells Fargo Revolving Credit Facility[128] - The Company had a Fixed Charge Coverage Ratio of 0.8 as of June 30, 2024, below the required minimum of 1.0[136] Shareholder Actions - The Company announced a share repurchase program authorizing the purchase of up to $85.0 million of Class A Common Stock[143] - The Company paid dividend distributions totaling $1.1 million to stockholders on April 5, 2024, and May 31, 2024[145] Market Outlook - The company anticipates stable demand for services due to OPEC+ production cuts and projected oil demand increases of 2.25 million barrels per day in 2024[75] - The company expects varied short to medium-term activity levels due to consolidation in the energy industry, but long-term prospects remain favorable[75] - OPEC+ expects oil demand to rise by approximately 2.25 million barrels per day in 2024 and by 1.85 million barrels per day in 2025[148] Risk Factors - Commodity price fluctuations are highly uncertain and could materially impact earnings, cash flows, and financial condition[150] - Geopolitical events, particularly regarding Russia and China, are expected to impact the macroeconomic backdrop of the industry[149] - Recent events in the Middle East have contributed to further uncertainty and risk to global stability[149] - The company does not currently intend to hedge its indirect exposure to commodity price risk[153] Trade Receivables - The top three trade receivable balances represented approximately 19%, 13%, and 8% of consolidated net accounts receivable as of June 30, 2024[152] - The top three trade receivable balances in the High Specification Rig segment represented 25%, 18%, and 13% of total net accounts receivable[152] - The majority of trade receivables have payment terms of 30 days or less, indicating a short credit cycle[152] - A hypothetical 1.0% increase or decrease in the weighted average interest rate would increase or decrease interest expense by less than $0.1 million per year[151] - The company has no borrowings under the Wells Fargo Revolving Credit Facility as of June 30, 2024[151]