Exhibit 99
[LOGO] RPC
An Oil & Gas Service Company
FOR IMMEDIATE RELEASE
RPC, INC. REPORTS RECORD 2005 SECOND QUARTER REVENUES AND PROFITS
o Revenues for the Second Quarter Increased 19.3 Percent over Prior Year
o Diluted EPS for the Second Quarter Increased 58.8 Percent to $0.27 from
$0.17 in the Prior Year
ATLANTA, July 27, 2005 -- RPC, Inc. (NYSE: RES) announced its unaudited results
for the second quarter ended June 30, 2005. RPC provides a broad range of
specialized oilfield services and equipment primarily to independent and major
oilfield companies engaged in the exploration, production and development of oil
and gas properties throughout the United States and in selected international
markets.
For the quarter ended June 30, 2005, revenues increased 19.3 percent to
$101,945,000 compared to $85,426,000 last year. Operating profit for the quarter
was $18,404,000, compared to $11,467,000 in the prior year, an increase of 60.5
percent. Net income for the quarter was $11,910,000, or $0.27 diluted earnings
per share, compared to $7,474,000, or $0.17 diluted earnings per share last
year.
Cost of services rendered and goods sold was $55,746,000, or 54.7 percent of
revenues, during the second quarter of 2005, compared to $49,189,000, or 57.6
percent of revenues, in the prior year. The increase in these costs was due to
the variable nature of many of these expenses, including compensation, materials
and supplies, maintenance and repair, and fuel costs. As a percentage of
revenues, however, these costs decreased because of higher equipment and
personnel utilization, improved pricing, and the leverage of fixed costs over
higher revenues. Selling, general and administrative expenses increased by 12.5
percent in the second quarter of 2005 to $18,188,000 from $16,166,000 in the
prior year. This increase was principally due to an increase in field
administrative personnel consistent with higher activity levels. These costs
were 17.8 percent of revenues in 2005 and 18.9 percent last year. The decrease
as a percentage of revenues was due to leverage of these costs over higher
revenues. Depreciation and amortization were $9,607,000 during the quarter, 11.7
percent higher than last year, due to capital expenditures made during recent
quarters.
For the six months ended June 30, 2005, revenues increased 17.4 percent to
$194,275,000 compared to $165,428,000 last year. Net income increased 64.5
percent to $21,837,000, or $0.50 diluted earnings per share compared to net
income of $13,275,000, or $0.31 diluted earnings per share last year.
"RPC's second quarter results reflect the continuation of strong activity levels
and the results of our continued investment in our business," stated Richard A.
Hubbell, RPC's President and Chief Executive Officer. "Our overall domestic
revenues increased due to higher activity levels, increased capacity, and
increased pricing for our services. The average domestic rig count during the
second quarter was 1,339, 15 percent higher than the same period in 2004. Our
revenues grew at a higher rate than the rig count because of the factors
mentioned above, partially offset by declines in international revenues and the
elimination of revenues from our marine liftboat division, which was sold in the
fourth quarter of 2004. Our international revenues declined in Kuwait and West
Africa, although they increased in Mexico and China.
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2nd Quarter 2005 Press Release
"We continue to believe that the near-term prospects for the domestic oilfield
are favorable," continued Hubbell. "We invested $21 million in new equipment and
maintenance of existing equipment during the quarter. We also invested more than
$10 million to re-purchase our common stock during the quarter. In spite of
these capital commitments, we continue to maintain a conservative, liquid
balance sheet."
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2nd Quarter 2005 Press Release
Summary of Segment Operating Performance
RPC's business segments are Technical Services and Support Services.
Technical Services includes RPC's oilfield service lines that utilize people and
equipment to perform value-added completion, production and maintenance services
directly to a customer's well. These services are generally directed toward
improving the flow of oil and natural gas from producing formations or to
address well control issues. The Technical Services include pressure pumping,
snubbing, coiled tubing, nitrogen, well control, downhole tools, surface
production equipment, casing installation services, and fishing tool operations.
Support Services includes RPC's oilfield service lines that provide equipment
for customer use or services to assist customer operations. The equipment and
services offered include drill pipe and related tools, pipe handling, inspection
and storage services, and oilfield training services.
Both Technical Services and Support Services experienced stronger results due to
the increased drilling rig count and related customer activity. Technical
Services revenues increased 21.7 percent for the quarter compared to the prior
year, driven by higher activity levels, increased capacity, and pricing
increases. Support Services revenues increased by 15.5 percent during the
quarter compared to the prior year. This increase was due to higher activity
levels and increased capacity resulting from continued investment in the rental
tools service line, partially offset by the elimination of revenues from our
marine liftboats, which were sold during the fourth quarter of 2004. There were
no revenues in the other segment during the quarter due to the sale of the
non-oilfield business unit that comprised this segment, which occurred during
the second quarter of 2004.
[GRAPHIC OMITTED]
RPC provides a broad range of specialized oilfield services and equipment
primarily to independent and major oilfield companies engaged in the
exploration, production and development of oil and gas properties throughout the
United States, including the Gulf of Mexico, mid-continent, southwest and Rocky
Mountain regions, and in selected international markets. RPC's investor website
can be found at www.rpc.net.
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2nd Quarter 2005 Press Release
Certain statements and information included in this press release constitute
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements include
statements regarding the near term prospects for the domestic oilfield and RPC's
expected activity and performance in the future. These statements involve known
and unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of RPC to be materially different from any
future results, performance or achievements expressed or implied in such
forward-looking statements. Such risks include the possibility of declines in
the price of oil and natural gas, which tend to result in a decrease in drilling
activity and therefore a decline in the demand for our services, the actions of
the OPEC cartel, the ultimate impact of current and potential political unrest
and armed conflict in the oil-producing regions of the world, which could impact
drilling activity, adverse weather conditions in oil or gas producing regions,
including the Gulf of Mexico, competition in the oil and gas industry, and risks
of international operations. Additional discussion of factors that could cause
the actual results to differ materially from management's projections,
forecasts, estimates and expectations is contained in RPC's Form 10-K filed with
the Securities and Exchange Commission for the year ended December 31, 2004.
For information contact:
BEN M. PALMER
Chief Financial Officer
404.321.2140
irdept@rpc.net
JIM LANDERS
Corporate Finance
404.321.2162
jlanders@rpc.net
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2nd Quarter 2005 Press Release
RPC INCORPORATED AND SUBSIDIARIES
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CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands except per share data)
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Periods ended June 30, (Unaudited) Second Quarter Six Months
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BETTER BETTER
2005 2004 (WORSE) 2005 2004 (WORSE)
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REVENUES $ 101,945 $ 85,426 19.3% $ 194,275 $ 165,428 17.4%
COSTS AND EXPENSES:
Cost of services rendered and goods sold 55,746 49,189 (13.3) 106,157 96,296 (10.2)
Selling, general and administrative expenses 18,188 16,166 (12.5) 36,594 31,292 (16.9)
Depreciation and amortization 9,607 8,604 (11.7) 18,887 17,140 (10.2)
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Operating profit 18,404 11,467 60.5 32,637 20,700 57.7
Interest income (expense), net 78 (33) NM 170 (58) NM
Other income, net 978 620 57.7 2,874 769 NM
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Income before income taxes 19,460 12,054 61.4 35,681 21,411 66.6
Income tax provision 7,550 4,580 (64.8) 13,844 8,136 (70.2)
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NET INCOME $ 11,910 $ 7,474 59.4% $ 21,837 $ 13,275 64.5%
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EARNINGS PER SHARE
Basic $ 0.28 $ 0.18 55.6% $ 0.51 $ 0.31 64.5%
================================== ==================================
Diluted $ 0.27 $ 0.17 58.8% $ 0.50 $ 0.31 61.3%
================================== ==================================
AVERAGE SHARES OUTSTANDING
Basic 42,232 42,450 42,423 42,424
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Diluted 43,522 43,218 43,792 43,103
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2nd Quarter 2005 Press Release
RPC INCORPORATED AND SUBSIDIARIES
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CONSOLIDATED BALANCE SHEETS
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At June 30, (Unaudited) (In thousands)
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2005 2004
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ASSETS
Cash and cash equivalents $ 10,610 $ 12,495
Accounts receivable, net 81,926 69,037
Inventories 12,684 9,133
Deferred income taxes 4,497 4,982
Income taxes receivable 577 4,340
Prepaid expenses and other current assets 2,775 2,677
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Total current assets 113,069 102,664
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Property, plant and equipment, net 127,887 114,683
Goodwill and other intangibles, net 24,770 15,942
Other assets 3,242 2,577
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Total assets $ 268,968 $ 235,866
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LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable $ 26,150 $ 21,746
Accrued payroll and related expenses 10,065 8,524
Accrued insurance expenses 3,271 3,869
Accrued state, local and other taxes 2,222 1,727
Current portion of long-term debt 2,000 700
Other accrued expenses 4,814 493
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Total current liabilities 48,522 37,059
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Accrued insurance expenses 6,932 6,123
Long-term debt -- 4,100
Pension liabilities 11,025 9,614
Deferred income taxes 10,024 15,439
Other long-term liabilities 1,381 1,820
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Total liabilities 77,884 74,155
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Common stock 4,282 4,314
Capital in excess of par value 20,949 27,134
Retained earnings 178,625 140,390
Deferred compensation (6,018) (3,820
Accumulated other comprehensive loss (6,754) (6,307
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Total stockholders' equity 191,084 161,711
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Total liabilities and stockholders' equity $ 268,968 $ 235,866
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Certain prior year balances have been reclassified to conform with current year
presentation.
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2nd Quarter 2005 Press Release
RPC INCORPORATED AND SUBSIDIARIES
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
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Six months ended June 30, (Unaudited) (In thousands)
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2005 2004
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Operating Activities:
Net income $ 21,837 $ 13,275
Depreciation, amortization and other non-cash charges 19,547 17,301
Other net changes in operating activities (8,866) (10,948)
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Net cash provided by operating activities 32,518 19,628
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Investing Activities:
Capital expenditures (34,066) (25,151)
Other investing activities (1,711) 108
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Net cash used for investing activities (35,777) (25,043)
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Financing Activities:
Payment of dividends (3,400) (1,708)
Payments on debt (2,800) (1,110)
Cash paid for common stock purchased and retired (10,211) (1,922)
Proceeds from exercise of stock options 644 348
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Net cash used for financing activities (15,767) (4,392)
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Net decrease in cash and cash equivalents (19,026) (9,807)
Cash and cash equivalents at beginning of period 29,636 22,302
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Cash and cash equivalents at end of period $ 10,610 $ 12,495
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