RPC Inc (NYSE: RES) reported Q2 EPS of ($0.10), $0.04 better than the analyst estimate of ($0.14). Revenue for the quarter came in at $89.3 million versus the consensus estimate of $102.09 million.

Management Commentary

"The average U.S. domestic rig count during the second quarter of 2020 was 392, a 60.4 percent decrease compared to the same period in 2019, and a 50.1 percent decrease compared to the first quarter of 2020," stated Richard A. Hubbell, RPC's President and Chief Executive Officer. "The average price of oil during the second quarter was $27.32 per barrel, a 54.4 percent decrease compared to the same period in 2019, and a 42.2 percent decrease compared to the first quarter of 2020. The average price of natural gas during the second quarter was $1.71 per Mcf, a 33.5 percent decrease compared to the same period in 2019, and a 10.9 percent decrease compared to the first quarter of 2020.

"U.S. oilfield drilling activity during the second quarter of 2020 declined to historic lows, and we believe completion activity declined at an even greater rate. RPC's revenues declined at a greater rate than the rig count due to our exposure to the completions market and continued pronounced weakness in pressure pumping. As we begin the third quarter, we believe domestic oilfield activity has passed the trough. While we anticipate industry activity will modestly increase during the second half of 2020, we are unsure whether this is the start of a sustained recovery. As a result, RPC will continue to focus on cost management, pricing discipline and capital expenditure controls.

"We are pleased to report a cash balance of $145.4 million at the end of the second quarter, an increase of $62.8 million compared to the end of the first quarter. Our cash balance is a result of effective working capital and capital expenditure management. We are fortunate to be in a strong financial position as we navigate this difficult environment," concluded Hubbell.

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