Ranger Energy Services(US:RNGR)2024-05-07 10:40Financial Performance - Total revenue for Q1 2024 decreased by $20.6 million, or 13%, to $136.9 million from $157.5 million in Q1 2023[90] - High Specification Rigs revenue increased by $2.2 million, or 3%, to $79.7 million, with an average revenue per rig hour rising 4% to $718[90] - Wireline Services revenue decreased by $17.1 million, or 34%, to $32.8 million, attributed to a 47% decrease in completed stage counts to 3,400[91] - Processing Solutions and Ancillary Services revenue fell by $5.7 million, or 19%, to $24.4 million, primarily due to decreased activity in coil tubing and snubbing services[93] - Net loss for the three months ended March 31, 2024, decreased by $7.0 million, or 113%, to a loss of $0.8 million from a profit of $6.2 million in the same period of 2023, primarily due to reduced activity in Wireline Services and Processing Solutions[101] - Adjusted EBITDA decreased by $9.2 million to $10.9 million for the three months ended March 31, 2024, from $20.1 million in the prior year[108] - High Specification Rigs Adjusted EBITDA decreased by $3.8 million to $13.6 million for the three months ended March 31, 2024, from $17.4 million in the same period of 2023, due to increased service costs[108] - Wireline Services Adjusted EBITDA decreased by $4.0 million to $0.2 million for the three months ended March 31, 2024, from $4.2 million in the prior year, due to decreased operating activity[109] Cost Management - Cost of services decreased by $10.1 million, or 8%, to $120.8 million, with cost of services as a percentage of revenue increasing to 88% from 83%[94] - High Specification Rigs cost of services increased by $6.2 million to $66.3 million, with variable expenses notably rising[94] - Wireline Services cost of services decreased by $13.1 million, or 29%, to $32.6 million, but the cost as a percentage of revenue increased to 99%[95] - Processing Solutions and Ancillary Services cost of services decreased by $3.2 million, or 13%, to $21.9 million, with costs as a percentage of revenue rising to 90%[96] - General and administrative expenses decreased by $1.7 million, or 20%, to $6.7 million for the three months ended March 31, 2024, compared to $8.4 million for the same period in 2023, primarily due to reduced employee and legal costs[97] - Depreciation and amortization increased by $1.2 million, or 12%, to $11.2 million for the three months ended March 31, 2024, from $10.0 million in the prior year, driven by capital expenditures[98] - Net interest expense decreased by $0.4 million, or 33%, to $0.8 million for the three months ended March 31, 2024, from $1.2 million in the same period of 2023, due to reduced borrowings[99] - Income tax benefit for the three months ended March 31, 2024, was $0.5 million, a decrease of $2.3 million, or 128%, from a tax expense of $1.8 million in the prior year, attributed to increased net operating loss utilization[100] Liquidity and Capital Structure - Total liquidity as of March 31, 2024, was $66.5 million, consisting of $11.1 million in cash and $55.4 million available under the Wells Fargo Revolving Credit Facility[112] - Net cash provided by operating activities decreased by $5.4 million to $12.0 million for the three months ended March 31, 2024, compared to $17.4 million in the same period of 2023[113] - As of March 31, 2024, the company's working capital decreased to $58.5 million from $66.4 million as of December 31, 2023, primarily due to lower cash and accounts receivable balances[118] - The company has a total loan capacity of $58.6 million under the Wells Fargo Revolving Credit Facility, with $3.2 million in Letters of Credit open, leaving $55.4 million available for borrowings as of March 31, 2024[122] - The weighted average interest rate for borrowings under the Wells Fargo Revolving Credit Facility was approximately 7.2% for the three months ended March 31, 2024[122] Shareholder Returns and Market Outlook - The company announced a share repurchase program authorizing the purchase of up to $85.0 million in Class A Common Stock, with an additional $50.0 million approved on March 4, 2024[130] - The company declared a quarterly cash dividend of $0.05 per share on May 7, 2024, payable on May 31, 2024, to stockholders of record[131] - 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[78] - The company expects short to medium-term activity to vary due to consolidation in the energy industry but anticipates long-term preference from larger organizations[78] - 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, indicating potential market growth[134] Risk and Debt Management - The company recognized a loss of $2.4 million on the retirement of debt associated with the initiation of the Wells Fargo Revolving Credit Facility[125] - The company made principal payments of $0.6 million to the Secured Promissory Note for the three months ended March 31, 2023, and $6.2 million for the five months ended May 31, 2023[128] - The company has no material off-balance sheet arrangements as of the reporting date[133] - The top three trade receivable balances represented approximately 15%, 14%, and 7% of consolidated net accounts receivable as of March 31, 2024, indicating concentration risk[138]