-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, NXiEtKv7Y8rvl6IgxT/zHQ8WR5YmTEOmVYIJlYKbXvafUfZBPM5hbwXy2r3zU5B8 ql66vIHTFnvdQwHlYrS9Pw== 0000891092-04-005104.txt : 20041027 0000891092-04-005104.hdr.sgml : 20041027 20041027085006 ACCESSION NUMBER: 0000891092-04-005104 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20041027 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041027 DATE AS OF CHANGE: 20041027 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RPC INC CENTRAL INDEX KEY: 0000742278 STANDARD INDUSTRIAL CLASSIFICATION: OIL, GAS FIELD SERVICES, NBC [1389] IRS NUMBER: 581550825 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-08726 FILM NUMBER: 041098089 BUSINESS ADDRESS: STREET 1: 2170 PIEDMONT RD NE CITY: ATLANTA STATE: GA ZIP: 30324 BUSINESS PHONE: 4048882950 MAIL ADDRESS: STREET 1: 2170 PIEDMONT ROAD CITY: ATLANTA STATE: GA ZIP: 30324 FORMER COMPANY: FORMER CONFORMED NAME: RPC ENERGY SERVICES INC DATE OF NAME CHANGE: 19920703 8-K 1 e19441_8k.txt FORM 8-K ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------- FORM 8-K ---------- CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): October 27, 2004 RPC, INC. (Exact name of registrant as specified in its charter) ---------- Delaware 1-8726 58-1550825 - ---------------------------- ------------------------ ------------------- (State or Other Jurisdiction (Commission File Number) (IRS Employer of Incorporation) Identification No.) 2170 Piedmont Road, NE, Atlanta, Georgia 30324 (Address of principal executive office) (zip code) Registrant's telephone number, including area code: (404) 321-2140 Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): |_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ================================================================================ Item 2.02 Results of Operations and Financial Condition. On October 27, 2004, RPC, Inc. issued a press release entitled "RPC, Inc. Reports 2004 Third Quarter Results," that announced the results of the third quarter ended September 30, 2004. Item 9.01 Financial Statements and Exhibits. (c) Exhibits. Exhibit 99 - Press Release dated October 27, 2004. -2- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, RPC, Inc. has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Marine Products Corporation. Date: October 27, 2004 /s/ BEN M. PALMER ------------------------------------- Ben M. Palmer Vice President, Chief Financial Officer and Treasurer -3- EXHIBIT INDEX Exhibit Number Description - -------------- ----------- Exhibit 99 Press Release dated October 27, 2004 EX-99 2 e19441ex99.txt PRESS RELEASE Exhibit 99 RPC, Inc. Reports 2004 Third Quarter Results * Revenues for the Third Quarter Increased 28.1 Percent over Prior Year * Diluted EPS for the Third Quarter Increased to $0.35 from $0.09 in the Prior Year ATLANTA, Oct. 27 /PRNewswire-FirstCall/ -- RPC, Incorporated (NYSE: RES) announced its unaudited results for the third quarter ended September 30, 2004. RPC provides a broad range of specialized oilfield services and equipment primarily to independent and major oilfield companies engaged in the exploration, production and development of oil and gas properties throughout the United States and in selected international markets. For the quarter ended September 30, 2004, revenues increased 28.1 percent to $88,721,000 compared to $69,244,000 last year. Net income was $10,237,000, or $0.35 diluted earnings per share, compared to $2,577,000 or $0.09 diluted earnings per share last year. Operating profit for the quarter was $12,971,000 compared to $3,937,000 in the prior year. Cost of services rendered and goods sold was $50,233,000, or 56.6 percent of revenues, during the third quarter of 2004, compared to $43,482,000, or 62.8 percent of revenues, in the prior year. The increase in these costs was due to the variable nature of many of these expenses, including compensation, equipment rental expense, maintenance and repairs, materials and supplies and fuel costs. As a percentage of revenues, however, these costs decreased because of improved pricing and higher equipment and personnel utilization. Selling, general and administrative expenses increased by 25.9 percent in the third quarter of 2004 to $16,921,000 from $13,438,000 in the prior year. This increase was due to an increase in salaries and wages expense, an increase in bad debt expense, and an increase in incentive compensation consistent with improved profitability. These costs decreased as a percentage of revenues to 19.1 percent in 2004 compared to 19.4 percent last year. Depreciation and amortization were $8,596,000 during the quarter, 2.5 percent higher than last year. Net income for the quarter ended September 30, 2004 was $10,237,000, compared to $2,577,000 in the prior year. Net income increased due to higher revenues and other income, and a lower effective tax rate, partially offset by higher costs of services rendered and goods sold and selling, general and administrative expenses. The effective tax rate during the quarter was 29.4 percent compared to 38.0 percent in the prior year and the first six months of the current year. The decrease in the effective tax rate was due to higher estimated full year foreign tax credit utilization and other adjustments recorded in the third quarter. The effective tax rate estimate change and adjustments increased third quarter net income by $1,241,000 or $0.04 diluted earnings per share. For the nine months ended September 30, 2004, revenues increased 26.6 percent to $254,149,000 compared to $200,808,000 last year. Net income was $23,512,000, or $0.82 diluted earnings per share compared to net income of $7,587,000, or $0.26 diluted earnings per share last year. "RPC's third quarter results reflect continued high activity levels, an increase in pricing, growth in our capacity, and the benefit of our international business development efforts," stated Richard A. Hubbell, RPC's President and Chief Executive Officer. "The average domestic rig count during the third quarter was 1,228, 13 percent higher than the same period in 2003. Our revenues grew at a higher rate than the rig count because of our continuing investment in our operating capacity, and our relatively stronger presence in the domestic mid-continent markets rather than the Gulf of Mexico, which remains weak. Our revenues also increased compared to the prior year due to strong activity in our West African operations, our new fishing tools service line, and our Kuwait business which began earlier this year. We invested over $11,000,000 in capital expenditures during the quarter to improve our existing fleet of equipment and purchase new equipment. Hubbell continued, "The third quarter of 2004 was marked by a series of strong hurricanes in the Gulf of Mexico, which severely curtailed oilfield drilling and production activity in that market. Because of our exposure to the Gulf of Mexico, we estimate that our revenues during the quarter were negatively impacted by these hurricanes in the range of three to five percent, and our bottom line earnings per share were negatively impacted in the range of five to 10 percent. We believe that the eventual recovery of activity in the Gulf of Mexico will provide temporary opportunities for us as our customers repair and enhance production in wells damaged by the storms. While we are pursuing these potential opportunities, we are uncertain about the timing and potential impact that they might have on our future results." Summary of Segment Operating Performance RPC's business segments are Technical Services and Support Services. 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 pressure pumping, snubbing, coiled tubing, nitrogen, wireline, well control, downhole tools, surface production equipment, casing installation services, and fishing tool operations. 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 rental of drill pipe and related tools, pipe handling, inspection and storage services, work platform vessels, and oilfield training services. Both Technical Services and Support Services experienced stronger results due to the increased drilling rig count and related customer activity. Technical Services revenues rose 36.9 percent for the quarter compared to the prior year, driven by higher activity levels and pricing increases in most of its service lines. Support Services revenues rose by 16.6 percent during the quarter compared to the prior year. This increase was driven by increased utilization and some pricing increases in rental tool revenues, which is the largest service line within Support Services, partially offset by lower utilization and pricing of marine liftboats. Other revenues were immaterial this quarter due to the sale of the non-oilfield business unit that comprises the majority of the revenues in this segment, which occurred during the second quarter of 2004. The impact of the sale of this business unit on operating and other income during the third quarter of 2004 was immaterial. Three Months Ended Nine Months Ended September 30, September 30, 2004 2003 2004 2003 (in thousands) Revenues: Technical services $73,404 $53,603 $209,523 $159,494 Support services 15,302 13,125 40,848 33,493 Other 15 2,516 3,778 7,821 Total revenues $88,721 $69,244 $254,149 $200,808 Operating profit (loss): Technical services $13,024 $3,969 $35,706 $15,154 Support services 2,378 2,376 4,629 3,073 Other (382) (419) (803) (1,200) Corporate expenses (2,049) (1,989) (5,861) (5,400) Total operating profit $12,971 $3,937 $33,671 $11,627 Other income, net 1,555 264 2,324 747 Interest expense, net 17 45 75 137 Income before income taxes $14,509 $4,156 $35,920 $12,237 RPC provides a broad range of specialized oilfield services and equipment primarily to independent and major oilfield companies engaged in the exploration, production and development of oil and gas properties throughout the United States, including the Gulf of Mexico, mid-continent, southwest and Rocky Mountain regions, and in selected international markets. RPC's investor website can be found at http://www.rpc.net. Certain statements and information included in this press release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements regarding RPC's future performance and the possibility of increased business opportunities in the Gulf of Mexico. These statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of RPC to be materially different from any future results, performance or achievements expressed or implied in such forward-looking statements. Such risks include the possibility of declines in the price of oil and natural gas, which tend to result in a decrease in drilling activity and therefore a decline in the demand for our services, the actions of the OPEC cartel, the ultimate impact of current and potential political unrest and armed conflict in the oil-producing regions of the world, which could impact drilling activity, adverse weather conditions in oil or gas producing regions, including the Gulf of Mexico, competition in the oil and gas industry, and risks of international operations. Additional discussion of factors that could cause the actual results to differ materially from management's projections, forecasts, estimates and expectations is contained in RPC's Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2003. RPC will host a conference call to review the Company's financial and operating results on Wednesday, October 27, 2004 at 8 a.m. Eastern Time. Individuals wishing to participate in the conference call should call (888) 744-3690 or (706) 643-1513 for international callers. For interested individuals unable to join the call, a replay will be available until midnight on November 3, 2004 by dialing (800) 642-1687 or (706) 645-9291, conference ID 1365299. This call also will be broadcast and archived on the company's investor Web site at http://www.rpc.net. Interested parties are encouraged to click on the webcast link 10-15 minutes prior to the start of the conference call. For information about RPC, Inc., please contact: BEN M. PALMER Chief Financial Officer 404.321.2140 irdept@rpc.net JIM LANDERS Corporate Finance 404.321.2162 RPC INCORPORATED AND SUBSIDIARIES STATEMENTS OF OPERATIONS (In thousands except per share data) Periods ended September 30, (Unaudited) Third Quarter % BETTER 2004 2003 (WORSE) REVENUES $88,721 $69,244 28.1 % COSTS AND EXPENSES: Cost of services rendered and goods sold 50,233 43,482 (15.5) Selling, general and administrative expenses 16,921 13,438 (25.9) Depreciation and amortization 8,596 8,387 (2.5) Operating profit 12,971 3,937 N/M Interest expense, net 17 45 62.2 Other income, net 1,555 264 N/M Income before income taxes 14,509 4,156 N/M Income tax provision 4,272 1,579 (170.6) NET INCOME $10,237 $2,577 N/M % EARNINGS PER SHARE Basic $0.36 $0.09 N/M % Diluted $0.35 $0.09 N/M % AVERAGE SHARES OUTSTANDING Basic 28,321 28,446 Diluted 28,914 28,877 RPC INCORPORATED AND SUBSIDIARIES STATEMENTS OF OPERATIONS (In thousands except per share data) Periods ended September 30, (Unaudited) Nine Months % BETTER 2004 2003 (WORSE) REVENUES $254,149 $200,808 26.6 % COSTS AND EXPENSES: Cost of services rendered and goods sold 146,529 125,798 (16.5) Selling, general and administrative expenses 48,213 38,599 (24.9) Depreciation and amortization 25,736 24,784 (3.8) Operating profit 33,671 11,627 189.6 Interest expense, net 75 137 45.3 Other income, net 2,324 747 N/M Income before income taxes 35,920 12,237 193.5 Income tax provision 12,408 4,650 (166.8) NET INCOME $23,512 $7,587 N/M % EARNINGS PER SHARE Basic $0.83 $0.27 N/M % Diluted $0.82 $0.26 N/M % AVERAGE SHARES OUTSTANDING Basic 28,296 28,380 Diluted 28,792 28,794 RPC INCORPORATED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS At September 30, (Unaudited) (In thousands) 2004 2003 ASSETS Cash and cash equivalents $16,101 $20,972 Accounts receivable, net 73,403 48,587 Inventories 10,161 9,538 Deferred income taxes 5,905 8,313 Income taxes receivable 4,047 2,993 Prepaid expenses and other current assets 1,370 1,777 Total current assets 110,987 92,180 Property, plant and equipment, net 117,039 108,008 Intangibles, net 15,932 12,663 Other assets 2,415 1,775 Total assets $246,373 $214,626 LIABILITIES AND STOCKHOLDERS' EQUITY Accounts payable $21,846 $15,606 Accrued payroll and related expenses 9,447 7,898 Accrued insurance expenses 4,041 3,008 Accrued state, local and other taxes 1,721 1,500 Current portion of long-term debt 2,700 1,110 Other accrued expenses 708 511 Total current liabilities 40,463 29,633 Accrued insurance expenses 6,458 6,414 Long-term debt 2,100 4,800 Pension liabilities 10,013 8,388 Deferred income taxes 13,638 11,137 Other long-term liabilities 2,610 2,338 Total liabilities 75,282 62,710 Common stock 2,876 2,873 Capital in excess of par value 28,348 27,810 Retained earnings 149,778 126,237 Deferred compensation (3,643) (1,137) Accumulated other comprehensive loss (6,268) (3,867) Total stockholders' equity 171,091 151,916 Total liabilities and stockholders' equity $246,373 $214,626 Certain prior year balances have been reclassified to conform with the current year presentation. RPC INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS Nine months ended September 30, (Unaudited) (In thousands) 2004 2003 Operating Activities: Net income $23,512 $7,587 Depreciation, amortization and other non-cash charges 26,074 24,857 Other net changes in operating activities (15,919) 6,036 Net cash provided by operating activities 33,667 38,480 Investing Activities: Capital expenditures (36,594) (20,711) Other investing activities 1,934 (4,883) Net cash used for investing activities (34,660) (25,594) Financing Activities: Payment of dividends (2,558) (2,155) Cash paid for common stock purchased and retired (1,963) (836) Other financing activities (687) (456) Net cash used for financing activities (5,208) (3,447) Net (decrease) increase in cash and cash equivalents (6,201) 9,439 Cash and cash equivalents at beginning of period 22,302 11,533 Cash and cash equivalents at end of period $16,101 $20,972 SOURCE RPC, Incorporated -0- 10/27/2004 /CONTACT: Ben M. Palmer, Chief Financial Officer, +1-404-321-2140, or irdept@rpc.net, or Jim Landers, Corporate Finance, +1-404-321-2162, both of RPC, Incorporated/ /Web site: http://www.rpc.net/ (RES) CO: RPC, Incorporated ST: Georgia IN: OIL SU: ERN CCA MAV -----END PRIVACY-ENHANCED MESSAGE-----