Revenue Performance - Total revenue for the three months ended March 31, 2025, was $42.88 million, a 16% increase from $36.97 million in the same period of 2024[190] - Tool rental revenues accounted for 81% of total revenues, while product sales contributed 19% during the three months ending March 31, 2025[180] - Western Hemisphere revenue increased by $2.89 million, or 8%, to $41.2 million, driven by the addition of the Diamond Products Division[191] - Eastern Hemisphere revenue surged by $3.8 million, or 305%, to $5.1 million, primarily due to acquisitions in the rental business[192] Operating Income and Expenses - Total operating income decreased by 36% to $3.3 million, down from $5.13 million in the prior year[190] - Interest expense increased significantly by 619% to $1.3 million, attributed to new loans and credit facility draws[194] - Corporate and other expenses rose by 15% to $10.1 million, mainly due to increased depreciation from acquired assets[193] Cash Flow and Liquidity - Net cash provided by operating activities for Q1 2025 was $2.4 million, down from $3.3 million in Q1 2024, driven by a net loss of $1.7 million[206] - Net cash used in investing activities for Q1 2025 was $7.3 million, including $5.0 million for property, plant, and equipment purchases and $5.6 million for the acquisition of Titan[207] - Net cash provided by financing activities for Q1 2025 was $1.4 million, compared to a net cash outflow of $24.6 million in Q1 2024[209] - Cash and cash equivalents as of March 31, 2025, were $2.8 million, with sufficient liquidity expected for the next 12 months[200] - Cash and cash equivalents at March 31, 2025, included approximately $5.3 million due from major customers[216] Future Outlook and Risks - The company expects federal net operating loss carryforwards to substantially reduce cash tax payments over the next several years[204] - The company has not entered into any hedging arrangements to minimize foreign currency exchange rate fluctuations, which may impact future cash flows[217] - The company is monitoring inflation risks due to rising international tariffs that could adversely affect business operations[219] - The company will continue to evaluate capital requirements for liquidity needs, influenced by various risks including inflation and interest rates[206] Cybersecurity - Cybersecurity measures include regular testing and an incident response plan to mitigate risks, although no assurance can be given that incidents will not occur[222] Rig Count - The average rig count in the Western Hemisphere decreased to 930 from 995 year-over-year, while the Eastern Hemisphere count increased to 757 from 725[187] Customer Concentration - 29.0% of total revenue in Q1 2025 was earned from two customers, slightly down from 30.0% in Q1 2024[216]
ROC ENERGY ACQUI(ROC) - 2025 Q1 - Quarterly Report