Ranger Energy Services(RNGR) - 2025 Q1 - Quarterly Report

PART I – FINANCIAL INFORMATION Item 1. Financial Statements (Unaudited) Net income improved to $0.6 million from a $0.8 million loss, with total revenue slightly decreasing to $135.2 million Condensed Consolidated Balance Sheets Total assets were $376.5 million, a slight decrease from year-end 2024, with $272.6 million in equity Condensed Consolidated Balance Sheet Highlights (in millions) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $40.3 | $40.9 | | Total current assets | $143.5 | $144.2 | | Property and equipment, net | $220.8 | $225.1 | | Total assets | $376.5 | $380.5 | | Liabilities & Equity | | | | Total current liabilities | $62.3 | $65.5 | | Total liabilities | $103.9 | $106.7 | | Total stockholders' equity | $272.6 | $273.8 | | Total liabilities and stockholders' equity | $376.5 | $380.5 | Condensed Consolidated Statements of Operations Total revenue slightly decreased to $135.2 million, while net income improved to $0.6 million from a $0.8 million loss Q1 2025 vs Q1 2024 Statement of Operations (in millions, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Revenue | $135.2 | $136.9 | | Total Cost of Services | $115.4 | $120.8 | | Operating Income (Loss) | $1.0 | $(0.5) | | Net Income (Loss) | $0.6 | $(0.8) | | Diluted EPS | $0.03 | $(0.03) | - Revenue from High Specification Rigs and Processing Solutions grew, but was offset by a significant decline in Wireline Services revenue[15] Condensed Consolidated Statements of Cash Flows Operating cash flow was $10.6 million, with net cash decreasing by $0.6 million due to investing and financing activities Q1 2025 vs Q1 2024 Cash Flows (in millions) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $10.6 | $12.0 | | Net cash used in investing activities | $(6.1) | $(5.7) | | Net cash used in financing activities | $(5.1) | $(10.9) | | Net change in cash | $(0.6) | $(4.6) | - The decrease in cash used in financing activities compared to Q1 2024 is mainly because there were no share repurchases in Q1 2025, whereas Q1 2024 included $8.5 million in repurchases[19][17] Notes to Condensed Consolidated Financial Statements Notes detail business segments, accounting policies, debt, equity, and segment performance, highlighting customer concentration - The company operates in three reportable segments: High Specification Rigs, Wireline Services, and Processing Solutions and Ancillary Services[21][25] - In Q1 2025, four customers accounted for approximately 29%, 11%, 13%, and 11% of consolidated revenues, indicating significant customer concentration[59] - The company has an $85.0 million share repurchase program, with $50.2 million remaining available as of March 31, 2025, and no shares were repurchased in Q1 2025[56][57] - The quarterly dividend was increased to $0.06 per share in 2025, with $1.3 million paid to shareholders in Q1 2025[58] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Improved net income driven by strong rig and processing segments, offsetting wireline weakness, with $104.4 million liquidity Business Outlook Wireline faces weak demand, but the company expects long-term benefits from E&P consolidation and monitors crude prices - The Wireline segment continues to face weakness due to declining completions activity and increased competition[80] - The company expects to benefit from ongoing consolidation among E&P operators, anticipating favorable preference from larger, more stable organizations[81] - Management is monitoring geopolitical events and OPEC+ production levels, noting that crude prices below $60 per barrel could trigger activity reductions[81][82] Results of Operations Total revenue decreased 1% to $135.2 million, with rig and processing growth offset by a 48% wireline decline Revenue by Segment - Q1 2025 vs Q1 2024 (in millions) | Segment | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | High specification rigs | $87.5 | $79.7 | +10% | | Wireline services | $17.2 | $32.8 | -48% | | Processing solutions and ancillary services | $30.5 | $24.4 | +25% | | Total revenue | $135.2 | $136.9 | -1% | - The decline in Wireline Services revenue was primarily due to a 64% decrease in completed stage counts, reflecting a strategic decision to pursue only work with appropriate margins[94] - The company's net income increased to $0.6 million from a loss of $0.8 million, driven by improved performance in the High Specification Rigs and Ancillary Services segments[104] Adjusted EBITDA Analysis Consolidated Adjusted EBITDA increased to $15.5 million, driven by rig and processing growth, despite wireline loss Adjusted EBITDA by Segment - Q1 2025 vs Q1 2024 (in millions) | Segment | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | High Specification Rigs | $17.4 | $13.6 | | Wireline Services | $(2.3) | $0.2 | | Processing Solutions and Ancillary Services | $5.6 | $2.5 | | Other | $(5.2) | $(5.4) | | Total Adjusted EBITDA | $15.5 | $10.9 | Liquidity and Capital Resources Total liquidity was $104.4 million, with no outstanding borrowings, sufficient for future capital and debt needs - Total liquidity was $104.4 million as of March 31, 2025, consisting of $40.3 million cash and $64.1 million available under the revolving credit facility[114] - The company had no outstanding borrowings under its Wells Fargo Revolving Credit Facility as of March 31, 2025[124] - Working capital increased to $81.2 million as of March 31, 2025, from $78.7 million at the end of 2024[120] Item 3. Quantitative and Qualitative Disclosures About Market Risks The company faces market risks from geopolitical events, interest rates, customer concentration, and commodity price volatility - The company is monitoring geopolitical events, such as conflicts in the Middle East and Ukraine, and their potential impact on commodity prices and global markets[130][131] - As of March 31, 2025, the top three trade receivable balances represented approximately 30%, 19%, and 9% of consolidated net accounts receivable, highlighting significant credit risk concentration[134] - The company's services are indirectly exposed to fluctuations in oil and natural gas prices, which can impact the activity levels of its E&P customers[135] Item 4. Controls and Procedures Disclosure controls and procedures were effective as of March 31, 2025, with no material changes in internal controls - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of March 31, 2025[138] - No changes occurred in internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, these controls[139] PART II – OTHER INFORMATION Item 1. Legal Proceedings The company is not currently subject to any material legal proceedings, maintaining prudent insurance coverage - The company is not currently a party to any material legal proceedings, and management does not expect existing matters to have a material adverse effect on its financial position[140] Item 1A. Risk Factors No material changes to risk factors previously disclosed in the company's Annual Report on Form 10-K - The company refers to the 'Risk Factors' section in its Annual Report for a description of factors that could materially affect its business, financial condition, and operating results[141] Item 2. Unregistered Sales of Securities and Use of Proceeds The company has an $85.0 million share repurchase program, with no shares repurchased in Q1 2025 - The Board of Directors has authorized a total share repurchase program of $85.0 million[142] - No shares of Class A Common Stock were repurchased on the open market during the first quarter of 2025[144] Item 5. Other Information No directors or executive officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements - No directors or executive officers adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter ended March 31, 2025[145] Item 6. Exhibits This section lists exhibits filed, including equity award agreements and CEO/CFO certifications - The report includes exhibits such as forms for Restricted Stock Unit and Performance Stock Unit agreements, as well as CEO and CFO certifications[148]