Active Mover: RPC Inc. (NYSE: RES)

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ATLANTA, January 19, 2020 – Shares of RPC Inc. (NYSE: RES) showed the bearish trend with a lower momentum of -3.64% to $4.77. The company traded total volume of 1.369M shares as contrast to its average volume of 2.30M shares. The company has a market value of $997.17M and about 209.05M shares outstanding.

For the quarter ended September 30, 2019, RPC Inc. (NYSE: RES) reported revenues of $293.20M, a decrease of 33.4 percent, compared with $440.00M in the third quarter of 2018. Revenues decreased due to lower activity levels and slightly lower pricing within most of RPC’s service lines. Operating loss for the third quarter of 2019 was $92.60M compared to operating profit of $54.60M in the same period of the prior year. Adjusted operating loss for the third quarter of 2019 was $21.00M. Net loss for the third quarter of 2019 was $69.20M, or $0.33 loss per share, compared to net income of $50.00M, or $0.23 diluted earnings per share, in the third quarter of 2018. Adjusted net loss for the third quarter of 2019 was $18.00M, or $0.08 adjusted loss per share. Earnings before interest, taxes, depreciation and amortization (EBITDA) for the third quarter was negative $48.90M, compared to EBITDA of $97.80M in the same period of the prior year. Adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA) for the third quarter was $22.80M.

For the nine months ended September 30, 2019, revenues decreased to $986.40M compared to $1.34B in the same period last year. Net loss for the nine-month period was $63.70M, or $0.30 loss per share, compared to net income of $162.00M, or $0.75 diluted earnings per share in the same period last year. Adjusted net loss for the nine-month period was $12.50M, or $0.06 adjusted loss per share.

Cost of revenues during the third quarter of 2019 was $225.20M, or 76.8 percent of revenues, compared to $300.90M, or 68.4 percent of revenues, during the third quarter of 2018. Cost of revenues decreased, consistent with lower activity levels, due to lower materials and supplies expenses, employment costs, and other expenses that vary with activity levels. Cost of revenues as a percentage of revenues increased due to lower activity levels, increasingly competitive pricing for our services, and labor cost inefficiencies.

Selling, general and administrative expenses were $42.60M in the third quarter of 2019 compared with $41.80M in the third quarter of 2018. As a percentage of revenues, these expenses increased to 14.5 percent in the third quarter of 2019 compared with 9.5 percent in the third quarter of 2018. Depreciation and amortization increased to $44.70M in the third quarter of 2019 compared with $43.00M in the third quarter of the prior year.

Discussion of Sequential Quarterly Financial Results:

RPC’s revenues for the quarter ended September 30, 2019 decreased by $65.30M, or 18.2 percent, compared with the second quarter of 2019 due primarily to lower activity levels in pressure pumping. Cost of revenues during the third quarter of 2019 decreased by $39.90M, or 15.0 percent, due primarily to decreases in materials and supplies expenses and other expenses which vary with activity levels. As a percentage of revenues, cost of revenues increased from 73.9 percent in the second quarter of 2019 to 76.8 percent in the third quarter of 2019, due primarily to labor inefficiencies and increasingly competitive pricing for our services. RPC’s adjusted operating loss for the third quarter of 2019 was $21.00M, compared with operating income of $8.40M in the second quarter of 2019. Adjusted EBITDA for the third quarter of 2019 was $22.80M compared to EBITDA of $51.20M in the prior quarter.

The Company offered net profit margin of -3.70% while its gross profit margin was 25.60%. ROE was recorded as -5.60% while beta factor was 1.21. The stock, as of recent close, has shown the weekly upbeat performance of 1.06% which was maintained at -8.97% in this year.