BUSINESS SEGMENT INFORMATION

9 Months Ended

Sep. 30, 2021

BUSINESS SEGMENT INFORMATION

BUSINESS SEGMENT INFORMATION

7.    BUSINESS SEGMENT INFORMATION

RPC’s reportable segments are the same as its operating segments. RPC manages its business under Technical Services and Support Services. Technical Services is comprised of service lines that generate revenue based on equipment, personnel or materials at the well site and are closely aligned with completion and production activities of the customers. Support Services is comprised of service lines which generate revenue from services and tools offered off the well site and are more closely aligned with the customers’ drilling activities. Selected overhead including centralized support services and regulatory compliance are classified as Corporate.

Technical Services consists primarily of pressure pumping, downhole tools, coiled tubing, snubbing, nitrogen, well control, wireline and fishing. The services offered under Technical Services are high capital and personnel intensive businesses. The Company considers all of these services to be closely integrated oil and gas well servicing businesses, and makes resource allocation and performance assessment decisions based on this operating segment as a whole across these various services.

Support Services consist primarily of drill pipe and related tools, pipe handling, pipe inspection and storage services, and oilfield training and consulting services. The demand for these services tends to be influenced primarily by customer drilling-related activity levels.

The Company’s Chief Operating Decision Maker (“CODM”) assesses performance and makes resource allocation decisions regarding, among others, staffing, growth and maintenance capital expenditures and key initiatives based on the operating segments outlined above.

Segment Revenues:

RPC’s operating segment revenues by major service lines are shown in the following table:

	Three months ended				Nine months ended
	September 30,				September 30,
(in thousands)	2021		2020		2021		2020
Technical Services:
Pressure Pumping	$	96,322	$	43,133	$	243,401	$	163,614
Downhole Tools		61,979		34,331		177,209		148,994
Coiled Tubing		26,733		12,407		61,900		37,619
Nitrogen		8,996		8,281		28,195		23,834
Snubbing		3,748		1,974		10,685		5,371
All other		14,064		9,152		39,212		38,079
Total Technical Services	$	211,842	$	109,278	$	560,602	$	417,511
Support Services:
Rental Tools	$	8,545	$	3,752	$	23,126	$	19,227
All other		4,923		3,558		12,949		12,927
Total Support Services	$	13,468	$	7,310	$	36,075	$	32,154
Total revenues	$	225,310	$	116,588	$	596,677	$	449,665

The following summarizes revenues for the United States and separately for all international locations combined for the three and nine months ended September 30, 2021 and 2020. The revenues are presented based on the location of the use of the equipment or services. Assets related to international operations are less than 10 percent of RPC’s consolidated assets, and therefore are not presented.

	Three months ended				Nine months ended
	September 30,				September 30,
(in thousands)	2021		2020		2021		2020
United States revenues	$	217,711	$	110,823	$	572,170	$	421,323
International revenues		7,599		5,765		24,507		28,342
Total revenues	$	225,310	$	116,588	$	596,677	$	449,665

The accounting policies of the reportable segments are the same as those referenced in Note 1 to these consolidated financial statements. RPC evaluates the performance of its segments based on revenues, operating profits and return on invested capital. Gains or losses on disposition of assets are reviewed by the CODM on a consolidated basis, and accordingly the Company does not report gains or losses at the segment level. Inter-segment revenues are generally recorded in segment operating results at prices that management believes approximate prices for arm’s length transactions and are not material to operating results.

Summarized financial information with respect RPC’s reportable segments for the three and nine months ended September 30, 2021 and 2020 are shown in the following table:

	Three months ended				Nine months ended
	September 30,				September 30,
(in thousands)	2021		2020		2021		2020
Revenues:
Technical Services	$	211,842	$	109,278	$	560,602	$	417,511
Support Services		13,468		7,310		36,075		32,154
Total revenues	$	225,310	$	116,588	$	596,677	$	449,665
Operating income (loss):
Technical Services	$	8,272	$	(24,941)	$	3,938	$	(71,248)
Support Services		(55)		(3,840)		(5,353)		(4,139)
Corporate Expenses		(3,080)		(6,534)		(9,760)		(13,003)
Impairment and Other Charges (1)		—		—		—		(207,175)
Gain on disposition of assets, net		2,837		3,563		7,408		7,576
Total operating income (loss)	$	7,974	$	(31,752)	$	(3,767)	$	(287,989)
Interest expense		(1,280)		(73)		(1,763)		(257)
Interest income		15		29		47		431
Other income (expense), net		448		769		1,571		(1,020)
Income (loss) before income taxes	$	7,157	$	(31,027)	$	(3,912)	$	(288,835)

⁽¹⁾ Represents $541 related to Corporate and the remainder to Technical Services.

As of and for the nine months ended	Technical		Support
September 30, 2021	Services		Services		Corporate		Total
(in thousands)
Depreciation and amortization	$	46,341	$	7,232	$	202	$	53,775
Capital expenditures		38,794		5,436		695		44,925
Identifiable assets	$	556,385	$	74,135	$	196,120	$	826,640

As of and for the nine months ended	Technical		Support
September 30, 2020	Services		Services		Corporate		Total
(in thousands)
Depreciation and amortization	$	77,224	$	5,088	$	209	$	77,521
Capital expenditures		43,437		8,338		538		52,313
Identifiable assets	$	475,168	$	64,463	$	261,246	$	800,877