Financial Performance And Outlook: Quarter-over-quarter, RPC’s (RES) revenues decreased by 1% in Q4 due to lower customer activity, typical of the fourth quarter. Despite a softer quarterly result, revenues from pressure pumping operations increased due to higher asset utilization. On the other hand, the sale of downhole and rental tools declined due to the seasonal slowdowns.
In Q4, RES saw a higher demand for tier 4 dual fuel assets. In 2025, its management is “optimistic” about new products and services in downhole tools. It plans to spend 20% lower on capex in FY2025 compared to FY2024. With a focus on cash flows and profitable operations, it also plans to pursue acquisitions to expand its business.
Net Income Decreased In Q4: Quarter-over-quarter, RES’s adjusted EBITDA margin contracted by 270 basis points following a contraction in the previous quarter. The company’s Technical Services segment operating income decreased by 35% quarter-over-quarter while operating income in the Support Services segment deteriorated by 51% from Q3 to Q4. Also, the company’s net income decreased by 32% during Q4. Read more about the company in our previous article here.
RES’s Cash Flows Decreased: RES maintained a debt-free balance sheet as of December 31. This, along with a cash balance of $326 million and a $100 million revolving credit facility, allowed for maintaining a dividend payment of $0.04 per share. Free cash flows, year-over-year, deteriorated in FY 2024 (39% down) because capex increased while cash flow from operations decreased.
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.
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