BUSINESS SEGMENT INFORMATION

3 Months Ended

Mar. 31, 2023

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 certain 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
	March 31,
(in thousands)	2023		2022
Technical Services:
Pressure Pumping	$	264,801	$	119,898
Downhole Tools		107,404		81,070
Coiled Tubing		40,066		26,850
Nitrogen		12,097		7,603
Snubbing		7,091		6,212
All other		20,532		24,716
Total Technical Services	$	451,991	$	266,349
Support Services:
Rental Tools	$	17,676	$	13,063
All other		7,001		5,212
Total Support Services	$	24,677	$	18,275
Total revenues	$	476,668	$	284,624

The following summarizes revenues for the United States and separately for all international locations combined for the three months ended March 31, 2023 and 2022. 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
	March 31,
(in thousands)	2023		2022
United States revenues	$	469,387	$	275,345
International revenues		7,281		9,279
Total revenues	$	476,668	$	284,624

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 months ended March 31, 2023 and 2022 are shown in the following table:

	Three months ended
	March 31,
(in thousands)	2023		2022
Revenues:
Technical Services	$	451,991	$	266,349
Support Services		24,677		18,275
Total revenues	$	476,668	$	284,624
Operating income:
Technical Services	$	103,533	$	21,811
Support Services		6,644		2,780
Corporate expenses		(5,081)		(4,510)
Pension settlement charge		(17,375)		—
Gain on disposition of assets, net		2,936		2,954
Total operating income	$	90,657	$	23,035
Interest expense		(72)		(178)
Interest income		1,855		15
Other income, net		761		504
Income before income taxes	$	93,201	$	23,376

As of and for the three months ended	Technical		Support
March 31, 2023	Services		Services		Corporate		Total
(in thousands)
Depreciation and amortization	$	22,008	$	2,104	$	13	$	24,125
Capital expenditures		63,002		1,313		985		65,300
Identifiable assets		851,689		82,530		253,611		1,187,830

As of and for the three months ended	Technical		Support
March 31, 2022	Services		Services		Corporate		Total
(in thousands)
Depreciation and amortization	$	16,974	$	2,427	$	65	$	19,466
Capital expenditures		16,624		2,410		50		19,084
Identifiable assets		616,961		74,021		200,186		891,168