Fundamentals weakened in Q1; deploys new pump: Quarter-over-quarter, RPC’s (RES) revenues remained nearly unchanged in Q1, while its adjusted EBITDA margin decreased incrementally by 80 basis points. Weather disruptions and adverse changes in the pressure-pumping job mix deteriorated performance in Q1. However, the company is deploying a new tier 4 dual-fuel pressure pump, replacing an old one. Deployment of more efficient pumps can improve its margin in the coming quarters.
Net income dips in Q1: RES’s net income declined by 18% in Q1 2023 compared to a quarter ago. A $17.4 million pension settlement charge in connection with the termination of its pension plan. Read more about the company in our previous article here.
RES’s clean balance sheet: RES maintained a debt-free balance sheet as of March 31. This, along with a cash balance of $178 million, would allow for share buybacks and continue with dividend payments ($0.04 per share).
Thanks for reading the RES take three, designed to give you three critical takeaways from RES’s earnings report. Soon we will present a second update on RES earnings highlighting its current strategy, news, and notes we extracted from our deeper dive.
