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RPC, Inc. Fourth Quarter and Full Year 2024 Financial Results

RPC, Inc. (NYSE: RES), a prominent diversified provider of oilfield services, recently released its unaudited financial results for the fourth quarter and the entire year ended December 31, 2024. This report highlights a blend of challenges and optimism as the company navigates the fluctuating energy market and introduces new initiatives.

Fourth Quarter Insights

In the fourth quarter of 2024, RPC reported a slight decline in revenues, which fell by 1% sequentially to $335.4 million. The company also faced a 32% decrease in net income, totaling $12.8 million, translating to diluted earnings per share of $0.06. The net income margin decreased by 180 basis points, settling at 3.8%. Notably, the adjusted EBITDA declined 17% sequentially to $46.1 million, with a margin of 13.7%. While revenues from pressure pumping services improved due to better utilization, other service lines experienced downturns attributable to seasonal variability in customer activities.

Factors Influencing Performance

The decline in average U.S. rig counts and changes in oil prices contributed significantly to RPC's performance. The average rig count held steady at 586, but this represented a notable 5.8% drop compared to the prior year. Similarly, oil prices saw a reduction, averaging $70.59 per barrel in the fourth quarter, down 7.8% from the third.

Yearly Performance Overview

Reflecting on 2024 as a whole, RPC, Inc. encountered various hurdles, with total revenues decreasing by 13% from the previous year, totaling $1.4 billion. Nevertheless, net income still reached $91.4 million, leading to a diluted earnings per share of $0.43. The adjusted EBITDA for the year was reported at $233.0 million, maintaining a margin of 16.5%.

Cash Flow and Shareholder Returns

RPC's robust operational performance is evident in its cash flows, generating $349.4 million from operating activities and yielding free cash flow of $129.5 million. The company has remained committed to returning value to its shareholders, having paid dividends amounting to $34.4 million and repurchasing $9.9 million of common stock during 2024. The board declared a regular quarterly cash dividend of $0.04 per share, set to be paid on March 10, 2025, which reflects RPC's ongoing commitment to shareholder returns amidst a challenging economic backdrop.

Strategic Outlook: Emphasizing Innovation

Looking ahead, Ben M. Palmer, RPC’s President and CEO, expressed a cautiously optimistic outlook for 2025. With plans to invest between $150 million to $200 million in new products, particularly in downhole tools, the company aims to capitalize on early positive trends observed during 2024. RPC is also intent on pursuing strategic acquisitions that focus on high cash-flow operations supporting strong customer bases.

While navigating an ever-competitive landscape, RPC aims to enhance service offerings through technological innovations and increased efficiency in its operations. The leadership's focus on maintaining a debt-free balance sheet, with over $300 million in cash, positions the company favorably for future investments and sustained capital returns to investors.

Conclusion

As RPC, Inc. reflects on its Q4 and full-year results for 2024, its preparedness for future growth remains evident. With an eye on strategic innovations and a commitment to providing value to shareholders, RPC is poised to adapt to the evolving dynamics of the oilfield services industry in 2025 and beyond. The company’s proactive measures underscore its resilience in a volatile sector, ensuring it remains a key player in the energy market.