ATLANTA, Oct. 25,
2023 /PRNewswire/ -- RPC, Inc. (NYSE: RES) today
announced its unaudited results for the third quarter and nine
months ended September 30, 2023. 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 and in selected international markets.
"RPC's third quarter 2023 operating results for the majority of
our service lines were relatively stable sequentially except for
the even weaker than expected decline in pressure pumping," stated
Ben M. Palmer, RPC's President and
Chief Executive Officer. "We believed this pressure pumping
weakness would prove temporary and made the decision to maintain
our pricing discipline and service readiness. This decision
resulted in carrying costs during the quarter in anticipation of a
busy fourth quarter calendar working at acceptable terms. A
highlight for the quarter was the recently acquired Spinnaker
cementing business. The integration has proceeded smoothly and the
business positively contributed to our financial results,"
concluded Palmer.
Consolidated Financial Results
For the quarter ended September 30,
2023, RPC generated revenues of $330.4 million, a decrease compared to
$415.9 million in the second quarter.
Revenues fell primarily due to declines in RPC's pressure pumping
business due to lower customer activity, partially offset by a full
quarter of financial results from our recent cementing acquisition.
Operating profit for the third quarter of 2023 was $22.7 million compared to $82.4 million in the second quarter. Net income
for the third quarter of 2023 was $18.3
million, or $0.08 diluted
earnings per share, compared to net income of $65.0 million, or $0.30 diluted earnings per share, in the second
quarter.
Adjusted operating profit1 for the third quarter of
2023 was $22.7 million compared to
$83.3 million in the second quarter
of 2023. Adjusted net income2 for the third quarter of
2023 was $18.3 million, or
$0.08 adjusted diluted earnings per
share2, compared to adjusted net income of $65.7 million, or $0.30 adjusted diluted earnings per share, in the
second quarter. Adjusted earnings before interest, taxes,
depreciation, and amortization (adjusted EBITDA)3 for
the third quarter of 2023, for which there was no
adjustment, was $51.9 million, a
decrease compared to $110.1 million
in the second quarter.
Cost of revenues, which excludes depreciation and amortization,
during the third quarter of 2023 was $239.1
million compared to $265.8
million in the second quarter. These costs as a percentage
of revenues were 72.4 percent in the third quarter of 2023, an
increase compared to 63.9 percent of revenues in the second quarter
because of lower revenues and the relatively fixed nature of direct
employment costs. Selling, general and administrative expenses were
$42.0 million in the third quarter of
2023 compared to $43.6 million in the
second quarter of 2023. Depreciation and amortization was
$28.4 million in the third quarter of
2023 compared to $26.2 million in the
second quarter of 2023.
RPC's revenues for the quarter ended September 30, 2023 decreased by $129.2 million, or 28.1 percent, compared to the
third quarter of the prior year due to lower activity levels and
more competitive pricing. Cost of revenues, which excludes
depreciation and amortization, during the third quarter of 2023
decreased by $70.7 million compared
to the third quarter of 2022. As a percentage of revenues, cost of
revenues increased to 72.4 percent in the third quarter of 2023
from 67.4 percent in the third quarter of 2022.
Selling, general and administrative expenses increased by
$3.8 million in the third quarter of
2023 compared to the third quarter of the prior year. RPC's
operating profit in the third quarter of 2023 was $22.7 million, compared to $92.2 million in the third quarter of 2022. Net
income for the third quarter of 2023 was $18.3 million compared to $69.3 million in the third quarter of 2022.
EBITDA3, in the third quarter of 2023 was $51.9 million compared to $113.0 million in the third quarter of 2022.
For the nine months ended September 30,
2023, revenues increased 9.2 percent to $1.2 billion compared to $1.1 billion for the same period last year. Net
income for the nine-month period was $154.9
million, or $0.71 diluted
earnings per share, compared to net income of $131.4 million, or $0.61 diluted earnings per share, in the same
period last year.
Rig Count and Commodity Price Statistics
The average U.S. domestic rig count during the third quarter of
2023 was 649, a 9.7 percent decrease compared to the second quarter
of 2023, and a 14.7 percent decrease compared to the third quarter
of 2022. The average price of oil during the third quarter of 2023
was $82.17 per barrel, an 11.7
percent increase compared to the second quarter of 2023, but an
11.5 percent decrease compared to the third quarter of 2022. The
average price of natural gas during the third quarter of 2023 was
$2.59 per Mcf, an increase of 19.9
percent compared to the second quarter of 2023, but a 67.8 percent
decrease compared to the third quarter of the prior year.
Summary of Segment Operating Performance
RPC manages two operating segments – Technical Services and
Support Services.
Technical Services includes RPC's oilfield service lines that
utilize people and equipment to perform value-added completion,
production and maintenance services directly to a customer's well.
These services are generally directed toward improving the flow of
oil and natural gas from producing formations or to address well
control issues. The Technical Services segment includes pressure
pumping, downhole tools and services, coiled tubing, cementing,
nitrogen, hydraulic workover services, surface pressure control
equipment, well control, and fishing tool operations.
Support Services includes RPC's oilfield service lines that
provide equipment for customer use or services to assist customer
operations. The equipment and services offered include rental of
tubulars and related tools, pipe inspection and storage services,
and oilfield training services.
Technical Services third quarter 2023 revenues decreased by 22.3
percent compared to the prior quarter and decreased by 30.5 percent
compared to the same period of the prior year. Technical Services
generated an operating profit of $18.9
million in the third quarter of 2023 compared to
$77.0 million in the prior quarter
and an operating profit of $89.5
million in the third quarter of the prior year. The
year-over-year declines in Technical Services operating results
were driven by lower pressure pumping revenues, the largest service
line within Technical Services.
Support Services revenues increased by 5.8 percent during the
third quarter of 2023 compared to the prior quarter and increased
by 14.8 percent compared to the same period of the prior year. The
increases in revenues were due to higher activity levels in rental
tools as compared to both comparable periods. Support Services
generated an operating profit of $6.9
million in the third quarter of 2023 and $7.9 million in the second quarter of 2023. Third
quarter 2023 Support Services operating profit increased by
$1.6 million compared to the third
quarter of the prior year due to higher activity levels and
leverage of higher revenues over costs that are fixed during the
short term.
(In
thousands)
|
|
Three Months
Ended
|
|
|
Nine Months
Ended
|
(Unaudited)
|
|
September
30,
|
|
June 30,
|
|
September
30,
|
|
|
September
30,
|
|
|
2023
|
|
2023
|
|
2022
|
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
Technical
Services
|
$
|
303,069
|
$
|
390,018
|
$
|
435,775
|
|
$
|
1,145,078
|
$
|
1,058,227
|
Support
Services
|
|
27,348
|
|
25,840
|
|
23,826
|
|
|
77,865
|
|
61,505
|
Total
revenues
|
$
|
330,417
|
$
|
415,858
|
$
|
459,601
|
|
$
|
1,222,943
|
$
|
1,119,732
|
Operating
profit:
|
|
|
|
|
|
|
|
|
|
|
|
Technical
Services
|
$
|
18,912
|
$
|
77,017
|
$
|
89,455
|
|
$
|
199,462
|
$
|
171,093
|
Support
Services
|
|
6,861
|
|
7,920
|
|
5,278
|
|
|
21,425
|
|
11,392
|
Corporate
expenses
|
|
(4,840)
|
|
(4,672)
|
|
(4,106)
|
|
|
(14,593)
|
|
(13,160)
|
Pension
settlement charges
|
|
-
|
|
(911)
|
|
-
|
|
|
(18,286)
|
|
-
|
Gain on
disposition of assets, net
|
|
1,778
|
|
3,015
|
|
1,543
|
|
|
7,729
|
|
6,295
|
Total operating
profit
|
$
|
22,711
|
$
|
82,369
|
$
|
92,170
|
|
$
|
195,737
|
$
|
175,620
|
Interest
expense
|
|
(101)
|
|
(73)
|
|
(143)
|
|
|
(246)
|
|
(543)
|
Interest
income
|
|
1,450
|
|
2,698
|
|
329
|
|
|
6,003
|
|
472
|
Other income
(expense), net
|
|
804
|
|
631
|
|
(67)
|
|
|
2,196
|
|
516
|
Income before income
taxes
|
$
|
24,864
|
$
|
85,625
|
$
|
92,289
|
|
$
|
203,690
|
$
|
176,065
|
RPC, Inc. will hold a conference call today, October 25, 2023 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 rpc.net. The live
conference call can also be accessed by calling (888) 440-5966, or
(646) 960-0125 for international callers, and use 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.
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
Mexico, mid-continent, southwest, Appalachian and Rocky
Mountain regions, and in selected international markets. RPC's
investor website can be found at rpc.net.
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
expectations regarding a busy calendar in the fourth quarter
working at acceptable terms. Additional discussion of factors that
could cause the actual results to differ materially from
management's projections, forecasts, estimates, and expectations is
contained in RPC's Form 10-K for the year ended December 31, 2022.
1Adjusted operating profit is a financial measure
which does not conform to GAAP. Additional disclosure regarding
this non-GAAP financial measure and its reconciliation to operating
profit, the nearest GAAP financial measure, is disclosed in
Appendix A to this press release.
2Adjusted net income and adjusted diluted earnings
per share are financial measures which do not conform to GAAP.
Additional disclosure regarding these non-GAAP financial measures
and their reconciliation to net income and income per share, the
nearest GAAP financial measures, are disclosed in Appendix B to
this press release.
3Adjusted EBITDA and EBITDA are financial measures
which do not conform to GAAP. Additional disclosure regarding these
non-GAAP financial measures and their reconciliation to net income,
the nearest GAAP financial measure, are disclosed in Appendix C to
this press release.
For information about RPC, Inc., please contact:
Michael L. Schmit, Chief
Financial Officer
(404) 321-2140
irdept@rpc.net
Jim Landers, Vice President
Corporate Services
(404) 321-2162
JLanders@rpc.net
RPC INCORPORATED AND
SUBSIDIARIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED
STATEMENTS OF OPERATIONS (In thousands except per
share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months
Ended
|
Periods ended,
(Unaudited)
|
|
|
September 30,
2023
|
|
|
June 30,
2023
|
|
|
September 30,
2022
|
|
|
September 30,
2023
|
|
|
September 30,
2022
|
REVENUES
|
|
$
|
330,417
|
|
$
|
415,858
|
|
$
|
459,601
|
|
$
|
1,222,943
|
|
$
|
1,119,732
|
COSTS AND
EXPENSES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues
(exclusive of depreciation and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
amortization shown separately below)
|
|
|
239,084
|
|
|
265,786
|
|
|
309,790
|
|
|
810,120
|
|
|
779,544
|
Selling, general and
administrative expenses
|
|
|
42,012
|
|
|
43,604
|
|
|
38,243
|
|
|
127,813
|
|
|
110,362
|
Pension settlement
charges
|
|
|
-
|
|
|
911
|
|
|
-
|
|
|
18,286
|
|
|
-
|
Depreciation and
amortization
|
|
|
28,388
|
|
|
26,203
|
|
|
20,941
|
|
|
78,716
|
|
|
60,501
|
Gain on disposition of
assets, net
|
|
|
(1,778)
|
|
|
(3,015)
|
|
|
(1,543)
|
|
|
(7,729)
|
|
|
(6,295)
|
Operating
profit
|
|
|
22,711
|
|
|
82,369
|
|
|
92,170
|
|
|
195,737
|
|
|
175,620
|
Interest
expense
|
|
|
(101)
|
|
|
(73)
|
|
|
(143)
|
|
|
(246)
|
|
|
(543)
|
Interest
income
|
|
|
1,450
|
|
|
2,698
|
|
|
329
|
|
|
6,003
|
|
|
472
|
Other income (expense),
net
|
|
|
804
|
|
|
631
|
|
|
(67)
|
|
|
2,196
|
|
|
516
|
Income before income
taxes
|
|
|
24,864
|
|
|
85,625
|
|
|
92,289
|
|
|
203,690
|
|
|
176,065
|
Income tax
provision
|
|
|
6,547
|
|
|
20,612
|
|
|
22,949
|
|
|
48,836
|
|
|
44,707
|
NET
INCOME
|
|
$
|
18,317
|
|
$
|
65,013
|
|
$
|
69,340
|
|
$
|
154,854
|
|
$
|
131,358
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER
SHARE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.08
|
|
$
|
0.30
|
|
$
|
0.32
|
|
$
|
0.71
|
|
$
|
0.61
|
Diluted
|
|
$
|
0.08
|
|
$
|
0.30
|
|
$
|
0.32
|
|
$
|
0.71
|
|
$
|
0.61
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE
SHARES OUTSTANDING
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
216,333
|
|
|
216,398
|
|
|
216,647
|
|
|
216,631
|
|
|
216,485
|
Diluted
|
|
|
216,333
|
|
|
216,398
|
|
|
216,647
|
|
|
216,631
|
|
|
216,485
|
RPC INCORPORATED AND
SUBSIDIARIES
|
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
|
|
|
|
|
|
(In
thousands)
|
|
|
September 30,
2023
|
|
|
December 31,
2022
|
|
|
(Unaudited)
|
|
|
|
ASSETS
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
171,874
|
|
$
|
126,424
|
Accounts receivable,
net
|
|
326,778
|
|
|
416,568
|
Inventories
|
|
109,969
|
|
|
97,107
|
Income taxes
receivable
|
|
62,889
|
|
|
42,403
|
Prepaid
expenses
|
|
11,701
|
|
|
17,753
|
Other current
assets
|
|
3,228
|
|
|
3,086
|
Total current
assets
|
|
686,439
|
|
|
703,341
|
Property, plant and
equipment, net
|
|
436,336
|
|
|
333,093
|
Operating lease
right-of-use assets
|
|
25,567
|
|
|
28,864
|
Finance lease
right-of-use assets
|
|
1,101
|
|
|
-
|
Goodwill
|
|
50,824
|
|
|
32,150
|
Other intangibles,
net
|
|
13,354
|
|
|
1,084
|
Other assets
|
|
33,752
|
|
|
30,481
|
Total
assets
|
$
|
1,247,373
|
|
$
|
1,129,013
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Accounts
payable
|
$
|
88,389
|
|
$
|
115,213
|
Accrued payroll and
related expenses
|
|
27,909
|
|
|
33,161
|
Accrued insurance
expenses
|
|
6,760
|
|
|
3,232
|
Accrued state, local
and other taxes
|
|
6,196
|
|
|
4,296
|
Income taxes
payable
|
|
259
|
|
|
499
|
Pension
liabilities
|
|
-
|
|
|
9,610
|
Current portion of
operating lease liabilities
|
|
7,959
|
|
|
10,728
|
Accrued expenses and
other liabilities
|
|
2,640
|
|
|
1,864
|
Total current
liabilities
|
|
140,112
|
|
|
178,603
|
Long-term accrued
insurance expenses
|
|
9,489
|
|
|
7,149
|
Long-term retirement
plan liabilities
|
|
21,898
|
|
|
23,106
|
Deferred income
taxes
|
|
50,472
|
|
|
37,473
|
Long-term operating
lease liabilities
|
|
19,040
|
|
|
19,517
|
Long-term finance lease
liabilities
|
|
882
|
|
|
-
|
Other long-term
liabilities
|
|
7,724
|
|
|
5,430
|
Total
liabilities
|
|
249,617
|
|
|
271,278
|
Common
stock
|
|
21,623
|
|
|
21,661
|
Capital in excess of
par value
|
|
-
|
|
|
-
|
Retained
earnings
|
|
978,496
|
|
|
856,013
|
Accumulated other
comprehensive loss
|
|
(2,363)
|
|
|
(19,939)
|
Total
stockholders' equity
|
|
997,756
|
|
|
857,735
|
Total
liabilities and stockholders' equity
|
$
|
1,247,373
|
|
$
|
1,129,013
|
Appendix A
RPC, Inc. has used the non-GAAP financial measure of adjusted
operating profit in today's earnings release and anticipates using
this non-GAAP financial measure in today's earnings conference
call. This measure should not be considered in isolation or as a
substitute for operating profit, or other performance measures
prepared in accordance with GAAP.
Management believes that presenting the financial measure of
adjusted operating profit enables us to compare our operating
performance consistently over various time periods.
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 below is a reconciliation of this non-GAAP measure with its
most directly comparable GAAP measure. This reconciliation
also appears on RPC, Inc.'s investor website, which can be found on
the Internet at rpc.net.
The Reconciliation of Operating Profit to Adjusted Operating
Profit is shown below:
Periods ended,
(Unaudited)
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
(In
thousands)
|
|
|
September 30,
2023
|
|
|
June 30,
2023
|
|
|
September 30,
2022
|
|
|
September 30,
2023
|
|
|
September 30,
2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Operating Profit to Adjusted Operating Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Profit
|
|
$
|
22,711
|
|
$
|
82,369
|
|
$
|
92,170
|
|
$
|
195,737
|
|
$
|
175,620
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension settlement
charges
|
|
|
-
|
|
|
911
|
|
|
-
|
|
|
18,286
|
|
|
-
|
Adjusted Operating
Profit
|
|
$
|
22,711
|
|
$
|
83,280
|
|
$
|
92,170
|
|
$
|
214,023
|
|
$
|
175,620
|
Appendix B
RPC, Inc. has used the non-GAAP financial measures of adjusted
net income and adjusted diluted earnings per share in today's
earnings release and anticipates using these non-GAAP financial
measures in today's earnings conference call. These measures
should not be considered in isolation or as a substitute for net
income, income per share, or other performance measures prepared in
accordance with GAAP.
Management believes that presenting the financial measures of
adjusted net income and adjusted income per share, enable us to
compare our operating performance consistently over various time
periods.
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 below is a reconciliation of these non-GAAP measures with
their most directly comparable GAAP measures. This
reconciliation also appears on RPC, Inc.'s investor website, which
can be found on the Internet at rpc.net.
The Reconciliation of Net Income to Adjusted Net Income and the
Reconciliation of Diluted Earnings Per Share to Adjusted Diluted
Earnings Per Share is shown below:
Periods ended,
(Unaudited)
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
(In
thousands)
|
|
|
September 30,
2023
|
|
|
June 30,
2023
|
|
|
September 30,
2022
|
|
|
September 30,
2023
|
|
|
September 30,
2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Net Income to Adjusted Net Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
|
|
$
|
18,317
|
|
$
|
65,013
|
|
$
|
69,340
|
|
$
|
154,854
|
|
$
|
131,358
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension settlement charges,
before taxes
|
|
|
-
|
|
|
911
|
|
|
-
|
|
|
18,286
|
|
|
-
|
Tax effect of pension
settlement charges *
|
|
|
-
|
|
|
(220)
|
|
|
-
|
|
|
(4,389)
|
|
|
-
|
Total adjustments, net
of tax
|
|
|
-
|
|
|
691
|
|
|
-
|
|
|
13,897
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net
Income
|
|
$
|
18,317
|
|
$
|
65,704
|
|
$
|
69,340
|
|
$
|
168,751
|
|
$
|
131,358
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* The sum of
adjustments for the three-month periods presented may differ from
the amounts for the six month period due to the differences
in effective tax
|
|
|
|
rate
for each period.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Diluted Earnings Per Share to Adjusted Diluted Earnings Per
Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted Earnings Per
Share
|
|
$
|
0.08
|
|
$
|
0.30
|
|
$
|
0.32
|
|
$
|
0.71
|
|
$
|
0.61
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension settlement charges,
net of tax
|
|
$
|
0.00
|
|
$
|
0.00
|
|
$
|
0.00
|
|
$
|
0.07
|
|
$
|
0.00
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Diluted Earnings Per Share
|
|
$
|
0.08
|
|
$
|
0.30
|
|
$
|
0.32
|
|
$
|
0.78
|
|
$
|
0.61
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Shares
Outstanding
|
|
|
216,333
|
|
|
216,398
|
|
|
216,647
|
|
|
216,631
|
|
|
216,485
|
Appendix C
RPC has used the non-GAAP financial measures of earnings before
interest, taxes, depreciation, and amortization (EBITDA) and
adjusted earnings before interest, taxes, depreciation, and
amortization (adjusted EBITDA) in today's earnings release and
anticipates using EBITDA and adjusted EBITDA in today's earnings
conference call. EBITDA and adjusted EBITDA should not be
considered in isolation or as a substitute for net income or other
performance measures prepared in accordance with GAAP.
RPC uses EBITDA and adjusted EBITDA as measures of operating
performance because they allow us to compare performance
consistently over various periods without regard to changes in our
capital structure. Adjusted EBITDA is useful to compare operating
performance net of unusual or non-recurring charges. We are also
required to use EBITDA to report compliance with financial
covenants under our revolving credit facility.
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 below is a reconciliation of net income, the most directly
comparable GAAP measure, to EBITDA and adjusted EBITDA. This
reconciliation also appears on RPC's investor website, which can be
found on the Internet at rpc.net.
The Reconciliation of Net Income to EBITDA and Adjusted EBITDA
is shown below:
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
(In
thousands)
|
|
|
September 30,
2023
|
|
|
June 30,
2023
|
|
|
September 30,
2022
|
|
|
September 30,
2023
|
|
|
September 30,
2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Net Income to EBITDA and Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
|
|
$
|
18,317
|
|
$
|
65,013
|
|
$
|
69,340
|
|
$
|
154,854
|
|
$
|
131,358
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
provision
|
|
|
6,547
|
|
|
20,612
|
|
|
22,949
|
|
|
48,836
|
|
|
44,707
|
Interest expense
|
|
|
101
|
|
|
73
|
|
|
143
|
|
|
246
|
|
|
543
|
Depreciation and
amortization
|
|
|
28,388
|
|
|
26,203
|
|
|
20,941
|
|
|
78,716
|
|
|
60,501
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
1,450
|
|
|
2,698
|
|
|
329
|
|
|
6,003
|
|
|
472
|
EBITDA
|
|
$
|
51,903
|
|
$
|
109,203
|
|
$
|
113,044
|
|
$
|
276,649
|
|
$
|
236,637
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension settlement
charges
|
|
|
-
|
|
|
911
|
|
|
-
|
|
|
18,286
|
|
|
-
|
Adjusted
EBITDA
|
|
$
|
51,903
|
|
$
|
110,114
|
|
$
|
113,044
|
|
$
|
294,935
|
|
$
|
236,637
|
View original content to download
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SOURCE RPC, Inc.