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RPC, Inc. Reports 2002 Third Quarter Results |
ATLANTA, Oct 18, 2002 (BUSINESS WIRE) -- RPC Incorporated (NYSE: RES) announced its unaudited results for the quarter and nine months ended September 30, 2002.
For the quarter ended September 30, 2002, revenues decreased 33.5 percent to $50,342,000 compared to $75,674,000 last year. Net loss from continuing operations was $1,040,000, or $0.04 diluted loss per share, compared to net income from continuing operations of $9,959,000 or $0.35 diluted earnings per share last year. Gross profit for the third quarter was $16,979,000, a 52.6 percent decrease from the same period in 2001. The operating loss for the third quarter was $1,660,000, compared to an operating profit of $16,201,000 in the third quarter of last year. Earnings before interest, taxes, depreciation and amortization (EBITDA) from continuing operations were $6,320,000 or $0.22 per diluted share for the quarter, compared to $23,016,000 or $0.80 per diluted share in the prior year.
For the nine months ended September 30, 2002, revenues decreased 31.3 percent to $143,844,000 compared to $209,238,000 last year. Net loss from continuing operations was $4,160,000, or a net loss of $0.15 per diluted share compared to net income from continuing operations of $26,532,000 or $0.93 diluted earnings per share last year. Earnings before interest, taxes, depreciation and amortization (EBITDA) from continuing operations were $16,910,000 or $0.60 per diluted share, compared to $60,854,000 for the prior year period or $2.13 per diluted share.
"RPC's third quarter results reflect the continued impact of low customer activity levels as evidenced in the year over year decline in the domestic oil and gas rig count," stated Richard A. Hubbell, RPC's President and Chief Operating Officer. "The average rig count during the third quarter was 853, which is 31 percent lower than the same period of 2001, and increased just six percent from the second quarter of this year. This factor was exacerbated late in the quarter by the impact of the two tropical storms, Lili and Isidore, which disrupted our customers' activity. The prices for oil and gas remain historically strong, but have failed to lead to an increase in drilling activity. This is inconsistent with the historically high correlation between commodity prices and rig counts.
"Mirroring the weaker industry activity levels, our revenues are down year over year because of less utilization combined with lower pricing in most of our service lines. In addition, our third quarter 2002 revenues were negatively impacted by the shutdown of our business operations in Algeria and Venezuela; these locations contributed to revenues throughout 2001 and through the first quarter of 2002. We are taking steps to improve our operational performance now and when business conditions improve by reducing operating costs wherever possible, reducing our selling, general and administrative expenses, and reassessing our capital spending levels. Our capital expenditures were approximately 54 percent lower during the third quarter of 2002 than 2001."
Hubbell continued, "RPC has continued to generate positive operating cash flow and we will maintain a strong, well-capitalized balance sheet."
Summary of Segment Operating Performance
Technical Services includes RPC's oilfield service lines that utilize people and equipment to perform value-added completion, production and maintenance services directly to a customer's well. These services are generally directed toward improving the flow of oil and natural gas from producing formations or to address well control issues. The Technical Services include snubbing, coiled tubing, pressure pumping, nitrogen, well control, downhole tools, wire line, fluid pumping, hot tapping, gate valve drilling and casing installation services.
Support Services includes RPC's oilfield service lines that provide equipment for customer use or services to assist customer operations. The equipment and services offered include drill pipe and related tools, pipe handling, inspection and storage services, work platform vessels, and oilfield training services.
Both Technical Services and Support Services were impacted by weaker customer demand. Technical Services revenues fell 32 percent for the quarter compared to the 31 percent decline in the rig count. Our Support Services tend to be impacted more by dramatic changes in rig counts, as indicated by the 44 percent decline in revenues for the quarter, compared to the prior year. These service lines perform quite well when industry conditions are more favorable.
** See attachment for entire release and tables ** |
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