BUSINESS SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2019

BUSINESS SEGMENT INFORMATION

BUSINESS SEGMENT INFORMATION

6.    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				Six months ended
	June 30,				June 30,
(in thousands)	2019		2018		2019		2018
Technical Services:
Pressure Pumping	$	170,066	$	269,040	$	317,825	$	525,195
Downhole Tools		112,763		107,521		222,434		200,562
Coiled Tubing		21,284		27,404		41,462		52,600
Nitrogen		12,219		11,784		23,527		23,215
Snubbing		4,355		6,055		7,818		10,027
All other		17,347		28,048		39,047		57,316
Total Technical Services	$	338,034	$	449,852	$	652,113	$	868,915
Support Services:
Rental Tools	$	13,962	$	12,550	$	27,898	$	22,570
All other		6,520		5,524		13,161		12,775
Total Support Services	$	20,482	$	18,074	$	41,059	$	35,345
Total revenues	$	358,516	$	467,926	$	693,172	$	904,260

The following summarizes revenues for the United States and separately for all international locations combined for the three and six months ended June 30, 2019. 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				Six months ended
	June 30,				June 30,
(in thousands)	2019		2018		2019		2018
United States revenues	$	343,688	$	443,922	$	657,656	$	861,306
International revenues		14,828		24,004		35,516		42,954
Total revenues	$	358,516	$	467,926	$	693,172	$	904,260

The accounting policies of the reportable segments are the same as those described 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 six months ended June 30, 2019 and 2018 are shown in the following table:

	Three months ended				Six months ended
	June 30,				June 30,
(in thousands)	2019		2018		2019		2018
Revenues:
Technical Services	$	338,034	$	449,852	$	652,113	$	868,915
Support Services		20,482		18,074		41,059		35,345
Total revenues	$	358,516	$	467,926	$	693,172	$	904,260
Operating income (loss):
Technical Services	$	6,850	$	75,624	$	2,392	$	140,629
Support Services		4,018		1,193		7,155		288
Corporate		(3,614)		(3,598)		(7,958)		(8,263)
Gain on disposition of assets, net		1,133		1,810		4,637		3,173
Total operating income	$	8,387	$	75,029	$	6,226	$	135,827
Interest expense		(164)		(113)		(253)		(218)
Interest income		594		458		1,394		860
Other (expense) income , net		(53)		4,104		392		9,499
Income before income taxes	$	8,764	$	79,478	$	7,759	$	145,968

As of and for the six months ended	Technical		Support
June 30, 2019	Services		Services		Corporate		Total
(in thousands)
Depreciation and amortization	$	80,370	$	4,856	$	160	$	85,386
Capital expenditures		125,171		6,260		822		132,253
Identifiable assets	$	1,030,073	$	86,928	$	106,966	$	1,223,967

As of and for the six months ended	Technical		Support
June 30, 2018	Services		Services		Corporate		Total
(in thousands)
Depreciation and amortization	$	70,910	$	6,444	$	220	$	77,574
Capital expenditures		144,511		4,467		714		149,692
Identifiable assets	$	983,177	$	77,372	$	158,099	$	1,218,648