RPC, Inc. Reports First Quarter 2025 Financial Results And Declares Regular Quarterly Cash Dividend

Rhea-AI Summary

RPC Inc (NYSE: RES) reported Q1 2025 financial results with revenues of $332.9 million, down 1% sequentially. Net income was $12 million with EPS of $0.06, representing a 6% sequential decline due to higher tax rates. EBITDA increased 6% to $48.9 million with a margin of 14.7%.

The company announced the acquisition of Pintail Completions, effective April 1, 2025, a leading Permian wireline perforation service provider that generated over $400 million in 2024 revenues. The $245 million acquisition was funded through $170 million cash, $50 million seller note, and $25 million in restricted stock.

The oilfield services market remains challenged with pressure pumping revenues flat and intense competition. Management noted concerns about volatile commodity prices, unclear oil supply/demand outlook, and uncertainty from new administration's tariff actions. The company maintains a strong balance sheet with $326.7 million in cash and no outstanding debt.

Positive

• EBITDA increased 6% sequentially to $48.9M with margin improvement of 100 basis points
• Strategic acquisition of Pintail Completions ($400M revenue business)
• Strong balance sheet with $326.7M cash and no debt
• Technical Services operating income up 32%
• Generated positive free cash flow of $7.6M

Negative

• Revenue declined 1% sequentially to $332.9M
• Net income decreased 6% to $12M
• Net income margin decreased 20 basis points to 3.6%
• Pressure pumping pricing remains highly competitive
• Higher tax rate impact on earnings (27.2% vs lower rate in Q4)

Insights

Financial Analyst

RPC shows resilience with improved EBITDA despite revenue dip; Pintail acquisition adds significant growth potential despite challenging market.

RPC's Q1 2025 results demonstrate a company effectively navigating difficult oilfield service conditions. While revenues dipped 1% sequentially to $332.9 million, EBITDA increased 6% to $48.9 million with margins expanding 100 basis points to 14.7%. The 6% sequential decline in net income to $12 million stemmed primarily from a normalized tax rate (27.2%) compared to Q4's unusually low rate.

The $245 million acquisition of Pintail Completions represents a strategic expansion into the Permian Basin's wireline perforation market. This positions RPC to significantly grow its footprint, as Pintail generated $400 million in 2024 revenues – equivalent to approximately 30% of RPC's annual revenue base. The transaction structure ($170 million cash, $50 million seller note, $25 million restricted stock) preserves financial flexibility.

Operationally, the Technical Services segment saw operating income jump 32% despite a slight revenue decline, indicating effective cost management and operational efficiency improvements. Support Services delivered modest growth with operating income up 3%, benefiting from the segment's fixed-cost structure.

RPC's balance sheet remains robust with $326.7 million in cash and no debt at quarter-end. Operating cash flow was $39.9 million with free cash flow of $7.6 million, supporting the continued $0.04 quarterly dividend.

Management's cautious outlook regarding "intense competition" and "volatile commodity prices" reflects the challenging environment for oilfield services. With U.S. rig count essentially flat and oil prices showing minimal sequential improvement, RPC's focus on "disciplined investments" and scrutinizing "capital deployment and other costs" appears strategically sound in an uncertain market.

ATLANTA, April 24, 2025 /PRNewswire/ -- RPC, Inc. (NYSE: RES) ("RPC" or the "Company"), a leading diversified oilfield services company, announced its unaudited results for the first quarter ended March 31, 2025.

* Non-GAAP measures, including EBITDA, EBITDA margin and free cash flow are reconciled to the most comparable GAAP measures in the appendices of this earnings release.

* Sequential comparisons are to 4Q:24. The Company believes quarterly sequential comparisons are most useful in assessing industry trends and RPC's recent financial results. Both sequential and year-over-year comparisons are available in the tables at the end of this earnings release.

First Quarter 2025 Results & Pintail Acquisition

• Revenues decreased 1% sequentially to $332.9 million
• Net income was $12 million, down 6% sequentially due to the unfavorable comparison to a low effective tax rate in 4Q:24, and diluted Earnings Per Share (EPS) was $0.06; Net income margin decreased 20 basis points to 3.6%
• Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) was $48.9 million, up 6% sequentially; EBITDA margin increased 100 basis points to 14.7%
• Results reflected stable revenues across most key service lines and solid sequential EBITDA margin performance
• The Company acquired Pintail Completions, effective April 1, 2025; Pintail is a leading wireline perforation service provider to blue chip customers in the Permian. Pintail generated over $400 million in 2024 revenues, has strong profitability and cash flow, and is well recognized for outstanding customer service

Management Commentary

"The first quarter was an encouraging start to the year across most of our service lines, and we were able to close on a significant acquisition to grow our business," stated Ben M. Palmer, RPC's President and Chief Executive Officer. "Our acquisition of Pintail Completions brings a scaled and high-quality company into our portfolio. Pintail's strong Permian operations are driven by a blue chip customer base and a highly regarded management team. We are excited for our combined prospects to bring world-class well completion services to our customers and continue to build RPC's diversified oilfield services model."

"The oilfield services market remains challenged, with pressure pumping revenues essentially flat while the remainder of our service line revenues were down slightly on a combined basis. We continue to see intense competition to keep assets utilized and will remain disciplined with our investments and scrutinize capital deployment and other costs to maximize returns on capital."

"Looking ahead, we are very excited about the Pintail acquisition despite operating in a period of high uncertainty, as the new administration's tariff actions have caused macro concerns. Commodity prices have been volatile, the near-term oil supply and demand outlooks are unclear, and the implications for current economic policies are likely to remain fluid. While difficult to forecast and plan in such an environment, rest assured we are committed to conservatively managing the business, driving cash flow and maintaining financial flexibility and a healthy balance sheet," concluded Palmer.

Selected Industry Data (Source: Baker Hughes, Inc., U.S. Energy Information Administration)
		1Q:25			4Q:24			Change			% Change		1Q:24			Change			% Change
U.S. rig count (avg)			588			586			2		0.3	%		623			(35)		(5.6)	%
Oil price ($/barrel)		$	71.93		$	70.59		$	1.34		1.9	%	$	77.46		$	(5.53)		(7.1)	%
Natural gas ($/Mcf)		$	4.14		$	2.43		$	1.71		70.4	%	$	2.15		$	1.99		92.6	%

 

1Q:25 Consolidated Financial Results (sequential comparisons versus 4Q:24)

Revenues were $332.9 million, down 1%. Revenues for pressure pumping, the Company's largest service line, were flat, while all other service lines combined decreased 1%. Within the Technical Services segment, pressure pumping pricing remains highly competitive in the marketplace, offsetting gains in asset utilization. Coiled tubing revenues decreased slightly while downhole tools and cementing were essentially unchanged. Within the Support Services segment, rental tools grew during the quarter with a seasonal pickup from year-end activity. New product launches in downhole tools continued to gain initial customer acceptance and are expected to contribute more meaningfully during 2025.

Cost of revenues, which excludes depreciation and amortization of $32.4 million, was $243.9 million, down from $250.2 million. These costs decreased 3% during the quarter, contributing to improved operating income. The decrease was primarily due to reduced fleet and transportation costs as we supplied fuel on fewer jobs, which is positive for our mix, as well as lower insurance costs, which were elevated in 4Q:24. Materials and supplies expenses were also lower, reflecting lower sand and other materials provided to customers. The Company continued its efforts to control discretionary costs in response to challenging oilfield services industry conditions.

Selling, general and administrative expenses were $42.5 million, up from $41.2 million; as a percent of revenues, SG&A increased 50 basis points to 12.8% due primarily to increased IT system implementation expenses and slightly lower revenues.

Interest income totaled $3.4 million, up slightly as interest rates and cash balances were generally stable.

Income tax provision was $4.5 million, or 27.2% of income before income taxes, reflecting a more normalized tax rate compared to the relatively low rate reported in 4Q:24 when the Company benefitted from certain tax strategies and interest received on tax refunds.

Net income and diluted EPS were $12.0 million and $0.06, respectively, versus $12.8 million and $0.06, respectively, in 4Q:24, due to the higher tax rate. Net income margin decreased 20 basis points sequentially to 3.6%.

EBITDA was $48.9 million, up from $46.1 million, reflecting lower operating costs partially offset by the slight decline in revenues. EBITDA margin increased 100 basis points sequentially to 14.7%.

Non-GAAP adjustments: there were no adjustments to GAAP performance measures in 1Q:25 other than those necessary to calculate EBITDA, EBITDA margin and free cash flow (see Appendices A and B).

Balance Sheet, Cash Flow and Capital Allocation

Cash and cash equivalents were $326.7 million at the end of the first quarter, with no outstanding borrowings under the Company's $100 million revolving credit facility (facility subject to $16.1 million outstanding letters of credit). These balances do not reflect the impact of the $245 million Pintail acquisition (closed on April 1, 2025), which included a $170 million cash payment, and the issuance of a $50 million seller note and $25 million of restricted common stock.

Net cash provided by operating activities and free cash flow were $39.9 million and $7.6 million, respectively, in 1Q:25.

Payment of dividends totaled $8.7 million in 1Q:25. Additionally, the Board of Directors declared a regular quarterly cash dividend of $0.04 per share, payable on June 10, 2025, to common stockholders of record at the close of business on May 9, 2025.

Share repurchases totaled $2.9 million in 1Q:25 related to restricted share vesting.

Segment Operations (sequential comparisons versus 4Q:24)

Technical Services performs value-added completion, production and maintenance services directly to a customer's well. These services include pressure pumping, downhole tools, coiled tubing, cementing, and other offerings.

• Revenues decreased 1% to $311.8 million
• Operating income was $14.0 million, up 32%
• Results were driven primarily by lower insurance costs, decreased fleet and transportation costs as discussed above and other cost control measures

Support Services provides equipment for customer use or services to assist customer operations, including rental tools, pipe inspection services and storage.

• Revenues were $21 million, up 1%
• Operating income was $2.7 million, up 3%
• Results were driven by higher activity in rental tools and the fixed-cost nature of these service lines

		Three Months Ended
		March 31,			December 31,			March 31,
(In thousands)		2025			2024			2024
			(Unaudited)			(Unaudited)			(Unaudited)
Revenues:
Technical Services		$	311,844		$	314,635		$	356,394
Support Services			21,033			20,726			21,439
Total revenues		$	332,877		$	335,361		$	377,833
Operating income:
Technical Services		$	14,003		$	10,603		$	31,956
Support Services			2,661			2,572			3,599
Corporate expenses			(5,804)			(4,515)			(4,420)
Gain on disposition of assets, net			1,526			1,857			1,214
Total operating income		$	12,386		$	10,517		$	32,349
Interest expense			(131)			(130)			(234)
Interest income			3,395			3,303			2,965
Other income, net			885			350			767
Income before income taxes		$	16,535		$	14,040		$	35,847

 

Conference Call Information

RPC, Inc. will hold a conference call today, April 24, 2025, at 9:00 a.m. ET to discuss the results for the quarter. Interested parties may listen in by accessing a live webcast in the investor relations section of RPC, Inc.'s website at www.rpc.net. The live conference call can also be accessed by calling (888) 440-5966, or (646) 960-0125 for international callers, and using conference ID number 9842359. For those not able to attend the live conference call, a replay will be available in the investor relations section of RPC, Inc.'s website beginning approximately two hours after the call and for a period of 90 days.

About RPC

RPC provides a broad range of specialized oilfield services and equipment primarily to independent and major oilfield companies engaged in the exploration, production and development of oil and gas properties throughout the United States, including the Gulf of America, mid-continent, southwest, Appalachian and Rocky Mountain regions, and in selected international markets. RPC's investor website can be found at www.rpc.net.

Forward Looking Statements

Certain statements and information included in this press release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements that look forward in time or express management's beliefs, expectations or hopes. In particular, such statements include, without limitation: our belief that our acquisition of Pintail Completions brings a scaled and high-quality company into our portfolio; our belief that Pintail's strong Permian operations are driven by a blue chip customer data base and a highly regarded management team; our plans to bring world-class well completion services to our customers and to continue to build our diversified oilfield services model; intense competition to keep assets utilized and that we will remain disciplined with our investments and scrutinize capital deployment and other costs to maximize returns on capital; our excitement regarding the Pintail acquisition; our belief that we are operating in a period of high uncertainty as the new administration's tariff actions have caused macro concerns; our belief that commodity prices have been volatile and that the near-term oil supply and demand outlooks are unclear and that the implications for current economic policies are likely to remain fluid; our commitment to conservatively managing the business, driving cash flow and maintaining financial flexibility and a healthy balance sheet; and statements that new product launches in downhole tools continued to gain initial customer acceptance and are expected to contribute more meaningfully during 2025. Risk factors that could cause such future events not to occur as expected include the following: the price of oil and natural gas and overall performance of the U.S. economy, both of which can impact capital spending by our customers and demand for our services; business interruptions due to adverse weather conditions; changes in the competitive environment of our industry; political instability in the petroleum-producing regions of the world; the actions of the OPEC oil cartel; our customers' drilling and production activities; the risk that our assessments, such as regarding the oversupplied nature of oilfield services, will turn out incorrect; and our ability to identify and complete acquisitions and/or other strategic investments or transactions. Additional factors that could cause the actual results to differ materially from management's projections, forecasts, estimates, and expectations are contained in RPC's Form 10-K for the year ended December 31, 2024.

For information about RPC, Inc., please contact:

Mark Chekanow, CFA, Vice President Investor Relations
(404) 419-3809
mark.chekanow@rpc.net

Michael L. Schmit, Chief Financial Officer
(404) 321-2140
irdept@rpc.net

RPC INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands except per share data)
		Three Months Ended
		March 31,			December 31,			March 31,
		2025			2024			2024
			(Unaudited)			(Unaudited)			(Unaudited)
REVENUES		$	332,877		$	335,361		$	377,833
COSTS AND EXPENSES:
Cost of revenues (exclusive of depreciation and amortization shown separately below)			243,895			250,248			276,609
Selling, general and administrative expenses			42,499			41,249			40,085
Depreciation and amortization			35,623			35,204			30,004
Gain on disposition of assets, net			(1,526)			(1,857)			(1,214)
Operating income			12,386			10,517			32,349
Interest expense			(131)			(130)			(234)
Interest income			3,395			3,303			2,965
Other income, net			885			350			767
Income before income taxes			16,535			14,040			35,847
Income tax provision			4,505			1,278			8,380
NET INCOME		$	12,030		$	12,762		$	27,467
EARNINGS PER SHARE
Basic		$	0.06		$	0.06		$	0.13
Diluted		$	0.06		$	0.06		$	0.13
WEIGHTED AVERAGE SHARES OUTSTANDING
Basic			215,691			214,950			215,001
Diluted			215,691			214,950			215,001

 

RPC INCORPORATED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
		(In thousands)
		March 31,			December 31,
		2025			2024
			(Unaudited)
ASSETS
Cash and cash equivalents		$	326,724		$	325,975
Accounts receivable, net			252,268			276,577
Inventories			109,761			107,628
Income taxes receivable			89			4,332
Prepaid expenses			13,182			16,136
Other current assets			2,021			2,194
Total current assets			704,045			732,842
Property, plant and equipment, net			503,910			513,516
Operating lease right-of-use assets			26,023			27,465
Finance lease right-of-use assets			4,682			4,400
Goodwill			50,824			50,824
Other intangibles, net			13,251			13,843
Retirement plan assets			30,674			30,666
Other assets			12,510			12,933
Total assets		$	1,345,919		$	1,386,489
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Accounts payable		$	88,760		$	84,494
Accrued payroll and related expenses			21,888			25,243
Accrued insurance expenses			6,891			7,942
Accrued state, local and other taxes			5,438			3,234
Income taxes payable			3,010			446
Unearned revenue			1,381			45,376
Current portion of operating lease liabilities			7,033			7,108
Current portion of finance lease liabilities and finance obligations			3,796			3,522
Accrued expenses and other liabilities			4,101			4,548
Total current liabilities			142,298			181,913
Long-term accrued insurance expenses			13,942			12,175
Long-term retirement plan liabilities			23,211			24,539
Long-term operating lease liabilities			19,599			21,724
Long-term finance lease liabilities			491			559
Other long-term liabilities			9,272			9,099
Deferred income taxes			55,520			58,189
Total liabilities			264,333			308,198
STOCKHOLDERS' EQUITY
Common stock			21,602			21,494
Capital in excess of par value			—			—
Retained earnings			1,062,805			1,059,625
Accumulated other comprehensive loss			(2,821)			(2,828)
Total stockholders' equity			1,081,586			1,078,291
Total liabilities and stockholders' equity		$	1,345,919		$	1,386,489

 

RPC INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
		(In thousands)
Three Months Ended March 31,		2025			2024
			(Unaudited)			(Unaudited)
OPERATING ACTIVITIES
Net income		$	12,030		$	27,467
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			35,623			30,004
Working capital			(6,920)			(3,945)
Other operating activities			(868)			3,033
Net cash provided by operating activities			39,865			56,559
INVESTING ACTIVITIES
Capital expenditures			(32,270)			(52,778)
Proceeds from sale of assets			4,827			3,772
Net cash used for investing activities			(27,443)			(49,006)
FINANCING ACTIVITIES
Payment of dividends			(8,653)			(8,621)
Cash paid for common stock purchased and retired			(2,868)			(9,858)
Cash paid for finance lease and finance obligations			(152)			(185)
Net cash used for financing activities			(11,673)			(18,664)
Net increase (decrease) in cash and cash equivalents			749			(11,111)
Cash and cash equivalents at beginning of period			325,975			223,310
Cash and cash equivalents at end of period		$	326,724		$	212,199

 

Non-GAAP Measures

RPC, Inc. has used the non-GAAP financial measures of EBITDA, EBITDA margin and free cash flow in today's earnings release. These measures should not be considered in isolation or as a substitute for performance or liquidity measures prepared in accordance with GAAP. Management believes that presenting these non-GAAP measures enables investors to compare the operating performance of our core business consistently over various time periods, and in the case of EBITDA, without regard to changes in our capital structure. Management believes that free cash flow, which measures our ability to generate additional cash from our business operations, is an important financial measure for use in evaluating RPC's liquidity. Free cash flow should be considered in addition to, rather than as a substitute for, net cash provided by operating activities as a measure of our liquidity. Additionally, RPC's definition of free cash flow is limited, in that it does not represent residual cash flows available for discretionary expenditures, due to the fact that the measure does not deduct the payments required for debt service and other contractual obligations or payments made for business acquisitions. Therefore, management believes it is important to view free cash flow as a measure that provides supplemental information to our Condensed Consolidated Statements of Cash Flows.

A non-GAAP financial measure is a numerical measure of financial performance, financial position, or cash flows that either 1) excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of operations, balance sheet or statement of cash flows, or 2) includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented.

Set forth in the appendices below are reconciliations of these non-GAAP measures with their most directly comparable GAAP measures. These reconciliations also appear on RPC, Inc.'s investor website, which can be found on the Internet at www.rpc.net.

Appendix A
(Unaudited)		Three Months Ended
		March 31,			December 31,			March 31,
(In thousands)		2025			2024			2024
Reconciliation of Net Income to EBITDA
Net income		$	12,030		$	12,762		$	27,467
Adjustments:
Add: Income tax provision			4,505			1,278			8,380
Add: Interest expense			131			130			234
Add: Depreciation and amortization			35,623			35,204			30,004
Less: Interest income			3,395			3,303			2,965
EBITDA		$	48,894		$	46,071		$	63,120
Revenues		$	332,877		$	335,361		$	377,833
Net income margin(1)			3.6 %			3.8 %			7.3 %
EBITDA margin(1)			14.7 %			13.7 %			16.7 %

(1) Net income margin is calculated as net income divided by revenues. EBITDA margin is calculated as EBITDA divided by revenues.

 

Appendix B
(Unaudited)		Three Months Ended March 31,
(In thousands)		2025			2024
Reconciliation of Operating Cash Flow to Free Cash Flow
Net cash provided by operating activities		$	39,865		$	56,559
Capital expenditures			(32,270)			(52,778)
Free cash flow		$	7,595		$	3,781

 

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SOURCE RPC, Inc.

FAQ

What were RPC Inc's (RES) key financial metrics for Q1 2025?

RPC reported Q1 2025 revenues of $332.9M (-1% QoQ), net income of $12M (-6% QoQ), EPS of $0.06, and EBITDA of $48.9M (+6% QoQ) with 14.7% margin.

How much did RPC (RES) pay for the Pintail Completions acquisition?

RPC paid $245 million total for Pintail, structured as $170M cash, $50M seller note, and $25M in restricted common stock.

What is RPC's (RES) current cash position and dividend policy?

RPC has $326.7M in cash with no debt, and declared a quarterly dividend of $0.04 per share payable June 10, 2025.

How did RPC's (RES) Technical Services segment perform in Q1 2025?

Technical Services revenue decreased 1% to $311.8M, but operating income increased 32% due to lower insurance and transportation costs.

What are the main challenges facing RPC (RES) in the current market?

RPC faces intense competition, volatile commodity prices, unclear oil supply/demand outlook, and uncertainty from new tariff actions.