RPC Inc. Q3 2024 10-Q: Assets & Liabilities Detailed

TL;DR

RPC Inc. Q3 10-Q: Assets $211.25M, Liab $212.79M. Share buybacks ongoing.

AI Summary

RPC Inc. filed its 10-Q for the period ending September 30, 2024. The company reported total assets of $211.25 million and total liabilities of $212.79 million for the nine months ended September 30, 2024. During the same period, RPC Inc. repurchased shares under its stock buyback program and also purchased shares for withholding taxes.

Why It Matters

This filing provides a snapshot of RPC Inc.'s financial health and operational activities for the third quarter of 2024, impacting investor understanding of its current standing.

Risk Assessment

Risk Level: medium — The filing indicates liabilities exceeding assets, which could signal financial strain.

Key Numbers

• $211.25B — Total Assets (As of September 30, 2024, for the nine-month period.)
• $212.79B — Total Liabilities (As of September 30, 2024, for the nine-month period.)
• $211.60B — Total Equity (As of September 30, 2024, for the nine-month period.)
• $213.08B — Total Equity (As of December 31, 2023.)

Key Players & Entities

• RPC INC (company) — Filer
• 20240930 (date) — Period of Report
• 20241024 (date) — Filed as of Date
• $211,248,000 (dollar_amount) — Total Assets for nine months ended 2024-09-30
• $212,790,000 (dollar_amount) — Total Liabilities for nine months ended 2024-09-30

FAQ

Key Financial Figures

• $0.10 — ch registered: Common stock, par value $0.10 RES New York Stock Exchange Indic

Filing Documents

• res-20240930x10q.htm (10-Q) — 1645KB
• res-20240930xex31d1.htm (EX-31.1) — 12KB
• res-20240930xex31d2.htm (EX-31.2) — 12KB
• res-20240930xex32d1.htm (EX-32.1) — 8KB
• 0001558370-24-013600.txt ( ) — 7358KB
• res-20240930.xsd (EX-101.SCH) — 44KB
• res-20240930_cal.xml (EX-101.CAL) — 54KB
• res-20240930_def.xml (EX-101.DEF) — 152KB
• res-20240930_lab.xml (EX-101.LAB) — 342KB
• res-20240930_pre.xml (EX-101.PRE) — 292KB
• res-20240930x10q_htm.xml (XML) — 1439KB

Financial Information

Part I. Financial Information Item 1.

Financial Statements (Unaudited)

Financial Statements (Unaudited) Consolidated Balance Sheets –As of September 30, 2024 and December 31, 2023 3 Consolidated Statements of Operations – For the three and nine months ended September 30, 2024 and 2023 4 Consolidated Statements of Comprehensive Income – For the three and nine months ended September 30, 2024 and 2023 5 Consolidated Statements of Stockholders' Equity – For the three and nine months ended September 30, 2024 and 2023 6 Consolidated Statements of Cash Flows – For the nine months ended September 30, 2024 and 2023 7

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 8 – 19 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 20 – 28 Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 28 Item 4.

Controls and Procedures

Controls and Procedures 28

Other Information

Part II. Other Information Item 1.

Legal Proceedings

Legal Proceedings 28 Item 1A.

Risk Factors

Risk Factors 28 Item 2. Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities 28 Item 3. Defaults upon Senior Securities 28 Item 4. Mine Safety Disclosures 29 Item 5. Other Information 29 Item 6. Exhibits 29

Signatures

Signatures 30 2 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS RPC, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2024 AND DECEMBER 31, 2023 (In thousands, except share and par value data) September 30, December 31, 2024 2023 ASSETS (Unaudited) Note 1 Cash and cash equivalents $ 276,888 $ 223,310 Accounts receivable, net of allowance for credit losses of $ 6,831 in 2024 and $ 7,109 in 2023 275,456 324,915 Inventories 113,489 110,904 Income taxes receivable 937 52,269 Prepaid expenses 8,493 12,907 Other current assets 2,517 2,768 Total current assets 677,780 727,073 Property, plant and equipment, less accumulated depreciation of $ 853,912 in 2024 and $ 810,933 in 2023 509,292 435,139 Operating lease right-of-use assets 28,905 24,537 Finance lease right-of-use assets 4,524 1,036 Goodwill 50,824 50,824 Other intangibles, net 14,436 12,825 Retirement plan assets 30,677 26,772 Other assets 14,159 8,639 Total assets $ 1,330,597 $ 1,286,845 LIABILITIES AND STOCKHOLDERS' EQUITY LIABILITIES Accounts payable $ 86,640 $ 85,036 Accrued payroll and related expenses 20,519 30,956 Accrued insurance expenses 5,662 5,340 Accrued state, local and other taxes 6,068 4,461 Income taxes payable 223 275 Unearned revenue — 15,743 Current portion of operating lease liabilities 7,186 7,367 Current portion of finance lease liabilities and finance obligations 3,617 375 Accrued expenses and other liabilities 4,690 2,304 Total current liabilities 134,605 151,857 Long-term accrued insurance expenses 11,331 10,202 Retirement plan liabilities 24,444 23,724 Deferred income taxes 55,161 51,290 Long-term operating lease liabilities 22,862 18,600 Long-term finance lease liabilities 671 819 Other long-term liabilities 9,182 7,840 Total liabilities 258,256 264,332 Commitments and contingencies (Note 12) STOCKHOLDERS' EQ

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. GENERAL The accompanying unaudited consolidated financial statements include the accounts of RPC, Inc. and its wholly-owned subsidiaries (RPC or the Company) and have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. These consolidated financial statements have been prepared in accordance with Accounting Standards Codification (ASC) Topic 810, "Consolidation" and Rule 3A-02(a) of Regulation S-X. In accordance with ASC Topic 810 and Rule 3A-02 (a) of Regulation S-X, the Company's policy is to consolidate all subsidiaries and investees where it has voting control. In the opinion of management, all adjustments (all of which consisted of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended September 30, 2024, are not necessarily indicative of the results to be expected for the year ending December 31, 2024. The balance sheet at December 31, 2023 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's annual report on Form 10-K for the fiscal year ended December 31, 2023. A group that includes Gary W. Rollins, Pamela R. Rollins, Amy Rollins Kreisler and Timothy C. Rollins, each of whom is a director of the Company, and certain companies under their control, controls in excess

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 3. BUSINESS ACQUISITION Effective July 1, 2023, the Company completed its acquisition of all of the outstanding equity interests in Spinnaker Oilwell Services, LLC (Spinnaker), pursuant to a Merger Agreement with Catapult Energy Services Group, LLC, as the representative of the Sellers. Spinnaker, headquartered in Oklahoma City, Oklahoma, is a leading provider of oilfield cementing services in the Permian and Mid-Continent basins. This acquisition significantly expanded RPC's cementing business from its presence in South Texas to basins in which it currently provides other services. Spinnaker is included in our Technical Services Segment. The supplemental pro forma financial information presented below has been prepared using the acquisition method of accounting and is based on the historical financial information of Spinnaker and RPC. This proforma financial information does not necessarily represent what the combined company's revenues or results of operations would have been had the acquisition been completed on January 1, 2023, nor do they intend to be a projection of future operating results of the combined company. The following table provides unaudited supplemental pro forma financial information as if the acquisition had occurred on January 1, 2023. Nine months ended September 30, (in thousands) 2023 Revenues $ 1,274,700 Net income 163,951 4. REVENUES Accounting Policy: RPC's contract revenues are generated principally from providing oilfield services. These services are based on mutually agreed upon pricing with the customer prior to the services being delivered and, given the nature of the services, do not include the right of return. Pricing for these services is a function of rates based on the nature of the specific job, with consideration for the extent of equipment, labor, and consumables needed for the job. RPC typically satisfies its performance obligations over time as

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Support Services Rental tools – RPC rents tools to its customers for use with onshore and offshore oil and gas well drilling, completion and workover activities. Other support services include oilfield pipe inspection services, pipe management and pipe storage and well control training. Payment terms: RPC's contracts with customers state the final terms of the sales, including the description, quantity, and price of each service to be delivered. The Company's contracts are generally short-term in nature and in most situations, RPC provides services ahead of payment - i.e., RPC has fulfilled the performance obligation prior to submitting a customer invoice. RPC invoices the customer upon completion of the specified services and collection is generally expected between 30 to 60 days after invoicing. As the Company enters into contracts with its customers, it generally expects there to be no significant timing difference between the date the services are provided to the customer (satisfaction of the performance obligation) and the date cash consideration is received. Accordingly, there is no financing component to our arrangements with customers. Significant judgments: RPC believes the output method is a reasonable measure of progress for the satisfaction of our performance obligations, which are satisfied over time, as it provides a faithful depiction of (1) our performance toward complete satisfaction of the performance obligation under the contract and (2) the value transferred to the customer of the services performed under the contract. RPC has elected the right to invoice practical expedient for recognizing revenue related to its performance obligations. Disaggregation of revenues: See note titled Business Segment Information for disaggregation of revenue by operating segment and services offered in each of them and by geographic regions. Contract balances: Contract assets representing the Co

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 5. DEPRECIATION AND AMORTIZATION Depreciation and amortization disclosed in the Consolidated Statements of Operations related to the following components: Three months ended Nine months ended September 30, September 30, (in thousands) 2024 2023 2024 2023 Cost of revenues $ 31,820 $ 25,590 $ 88,664 $ 71,249 Selling, general and administrative expenses 3,214 2,798 8,707 7,467 Total $ 35,034 $ 28,388 $ 97,371 $ 78,716 6. EARNINGS PER SHARE Basic and diluted earnings per share are computed by dividing net income by the weighted average number of shares outstanding during the respective periods. In addition, the Company has periodically issued share-based payment awards that contain non-forfeitable rights to dividends and are therefore considered participating securities. The following table shows the restricted shares of common stock (participating securities) outstanding and a reconciliation of outstanding weighted average shares: Three months ended Nine months ended September 30, September 30, (in thousands) 2024 2023 2024 2023 Net income available for stockholders $ 18,796 $ 18,317 $ 78,682 $ 154,854 Less: Adjustments for earnings attributable to participating securities ( 308 ) ( 279 ) ( 1,219 ) ( 2,477 ) Net income used in calculating earnings per share $ 18,488 $ 18,038 $ 77,463 $ 152,377 Weighted average shares outstanding (including participating securities) 214,976 216,333 214,940 216,631 Adjustment for participating securities ( 3,728 ) ( 3,543 ) ( 3,341 ) ( 3,549 ) Shares used in calculating basic and diluted earnings per share 211,248 212,790 211,599 213,082 7. STOCK-BASED COMPENSATION The Company has issued various forms of stock incentives, including incentive and non-qualified stock options, time-lapse restricted shares and performance share unit awards under

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Support Services consist primarily of drill pipe and related tools, pipe handling, pipe inspection and storage services, and oilfield training services. The demand for these services tends to be influenced primarily by customer drilling-related activity levels. The Company's Chief Operating Decision Maker (CODM) assesses performance and makes resource allocation decisions regarding, among others, staffing, growth and maintenance capital expenditures and key initiatives based on the operating segments outlined above. Segment Revenues: RPC's operating segment revenues by major service lines are shown in the following table: Three months

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