BUSINESS SEGMENT INFORMATION

3 Months Ended

Mar. 31, 2024

BUSINESS SEGMENT INFORMATION

BUSINESS SEGMENT INFORMATION

8.    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, cementing, 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)	2024		2023
Technical Services:
Pressure Pumping	$	176,256	$	264,801
Downhole Tools		93,794		107,404
Coiled Tubing		33,168		40,066
Cementing		27,751		6,245
Nitrogen		9,550		12,097
Snubbing		4,856		7,091
All other		11,019		14,287
Total Technical Services		356,394		451,991
Support Services:
Rental Tools		15,974		17,676
All other		5,465		7,001
Total Support Services		21,439		24,677
Total revenues	$	377,833	$	476,668

The following summarizes revenues for the United States and separately for all international locations combined for the three months ended March 31, 2024 and 2023. 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% of RPC’s consolidated assets, and therefore are not presented.

	Three months ended
	March 31,
(in thousands)	2024		2023
United States revenues	$	367,938	$	469,387
International revenues		9,895		7,281
Total revenues	$	377,833	$	476,668

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, 2024, and 2023 are shown in the following table:

	Three months ended
	March 31,
(in thousands)	2024		2023
Revenues:
Technical Services	$	356,394	$	451,991
Support Services		21,439		24,677
Total revenues	$	377,833	$	476,668
Operating income:
Technical Services	$	31,956	$	103,533
Support Services		3,599		6,644
Corporate expenses		(4,420)		(5,081)
Pension settlement charges		—		(17,375)
Gain on disposition of assets, net		1,214		2,936
Total operating income		32,349		90,657
Interest expense		(234)		(72)
Interest income		2,965		1,855
Other income, net		767		761
Income before income taxes	$	35,847	$	93,201

As of and for the three months ended	Technical		Support
March 31, 2024	Services		Services		Corporate		Total
(in thousands)
Depreciation and amortization	$	27,170	$	2,815	$	19	$	30,004
Capital expenditures		43,869		7,813		1,096		52,778
Identifiable assets		897,462		79,763		320,008		1,297,233

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