RES 10-K & 10-Q changes, risk factors and insider trading

At times our business has had a concentration of one or more major customers. One of our customers, a private E&P company, accounted for approximately 15% of the Company’s revenues in 2025 and 13% of the Company’s revenues in 2024;2024. andThe anothercustomer privatethat E&Pexceeded company accounted for approximately 11%10% of the Company’s revenues in 2022.2025 and 2024 was primarily associated with the Company’s Technical Services segment. There were no other customers in 20222025 orand 2024, and no customers in 2023 exceeding 10% of revenues. Amounts for customers that exceeded 10% of the Company’s revenues in 2024 and 2022 were primarily associated with the Company’s Technical Services segment. In addition, there was one customer that was also primarily associated with the Company’s Technical Services segment that accounted for approximately 10% of accounts receivable as of December 31, 2023. There were no customers that accounted for 10% or more of accounts receivable as of December 31, 2025, or December 31, 2024. The reliance on a large customer for a significant portion of our total revenues exposes us to the risk that the loss or reduction in revenues from this customer, which could occur unexpectedly, could have a material and disproportionate adverse impact uponon our revenues and operating results.

Many of our customers rely on their ability to raise equity capital and debt financing from capital markets to fund their operations. Their ability to raise outside capital depends upon, among other things, the availability of capital, near-term operating prospects of oil and gas companies, current and projected prices of oil and natural gas, and relative attractiveness of competing investments for available investment capital. In addition, continued elevated interest rates continue to impact their ability to borrow cost effectively and potentially constrain the amount of borrowings. These factors are outside of our control, and in the event our customers cannot continue to raise outside capital to fund their operations, RPC’s financial results would be negatively impacted.

We operate inwithin the highly competitive areas of the OFS industry. The equipment and services in our industry segments are sold in highly competitive markets, and our revenues and earnings have in the past been affected by changes in competitive prices, fluctuations in the level of activity in major markets and general economic conditions. We compete with the oil and gas industry’s many large and small industry competitors, including the largest integrated oilfield service providers. We believe that the principal competitive factors in the market areas that we serve are product and service quality and availability, reputation for safety, technical proficiency and price. Although we believe that our reputation for safety and quality service is good, we cannot assure you that we will be able to maintain our competitive position.

Acquisitions have been and may continue to be a key element of our business strategy. We cannot assure you that we will be able to identify and acquire acceptable acquisition candidates on terms favorable to us in the future. We may be required to incur substantial indebtedness to finance future acquisitions and also may issue equity securities in connection with such acquisitions. The issuance of additional equity securities could result in significant dilution tofor our stockholders. We cannot assure you that we will be able to successfully integrate the operations and assets of any acquired business with our own business. Any inability on our part to integrate and manage the growth of acquired businesses could have a material adverse effect on our results of operations and financial condition.

Our business requires a great deal of capital to maintain our equipment and increase our fleet of equipment to expand our operations, and we currently have access to our credit facility to fund our necessary working capital and other capital requirements. Our credit facility provides a borrowing base of $100 million less the amount of any outstanding letters of credit, and bears interest at a floating rate, which exposes us to market risks as interest rates rise. If our existing capital resources become unavailable, inadequate, or unfavorable for purposes of funding our capital requirements, we would need to raise additional funds through alternative debt or equity financings to maintain our equipment and continue our growth. Such additional financing sources may not be available when we need them or may not be available on favorable terms. If we fund our growth through the issuance of public equity, the holdings of stockholders will be diluted. If capital generated either by cash provided by operating activities or outside financing is not available or sufficient for our needs, we may be unable to maintain our equipment, expand our fleet of equipment, or take advantage of other potentially profitable business opportunities, which could reduce our future revenues and profits. Recent increases in interest rates, not withstanding modest interest rate reductions by the US Federal Reserve Board, have increased our cost of borrowing, and further increases could materially adversely affect our ability to fund working capital and other capital requirements on a cost-effective basis, and could and negatively impact our cash flows and profitability.

Many companies are receiving greater attention from stakeholders regarding their ESG practices, as well as their oversight of relevant ESG issues. The various stakeholders are placing growing importance on our potential environmental and social issue risk exposure and the impact of our choices. Increased focus on ESG and related decision-making may negatively impact us as customers, investors and other stakeholders may choose not to work with us or may reallocate capital or decline to make an investment as a result of their assessment of our ESG practices. Companies that do not comport with, or do not adapt to, these evolving investor and stakeholder ESG-related expectations and standards, or that are assessed as not having responded appropriately to the growing focus on ESG matters, may have their brand and reputation harmed, and the Company or our stock price may be adversely affected even though we may be in full compliance with all relevant laws and regulations. In addition, changed priorities in terms of governmental interpretation of discrimination and other laws could result in enforcement actions or other litigation regarding the Company’s ESG practices.

Furthermore, the SEC has issued final rules, which are currently stayed pending judicial reviewreview, and we cannot predict whether, when, or in what form such rules may ultimately be implemented; however, if implemented as proposed, these rules would, among other matters, establish a framework for reporting climate-related risks. To the extent that any rules ultimately implemented impose additional reporting obligations, we could face increased costs. Separately, the SEC has also announced that it is scrutinizing existing climate change related disclosures in public filings, increasing the potential for enforcement if the SEC were to allege our existing climate disclosures are misleading or deficient. Furthermore, in November 2022, the U.S. Department of Labor (“DOL”) adopted final rules that allow plan fiduciaries to consider climate change and other ESG factors when they select retirement investments and exercise shareholder rights, such as proxy voting. The DOL has announced that it will no longer defend these rules and that it intends to replace the rules, although no action in this regard has been taken, and the rules remain in effect. Should plan investors decide not to invest in us based on ESG factors, our business and access to capital may be negatively impacted. In 2023, the State of California enacted legislation that will require large U.S. companies doing business in California to make broad-based climate-related disclosures starting as early as 2026, and other jurisdictions, domestically and internationally, are also considering various climate change disclosure requirements.

RPC’s pressure pumping services are the subject of continuing federal, state and local regulatory oversight. This scrutiny is prompted in part by public concern regarding the potential impact on drinking and ground water and other environmental issues arising from the growing use of hydraulic fracturing. In addition, a committee of the United States House of Representatives investigated hydraulic fracturing practices and publicized information regarding the materials used in hydraulic fracturing. Compliance with federal and state regulations relating to pressure pumping services could increase our operating costs, cause operational delays, and could reduce or eliminate the demand for our pressure pumping services. The U.S. Environmental Protection Agency (EPA) also conducted a study of the environmental impact of hydraulic fracturing practices, and in 2015, issued a report which concluded that hydraulic fracturing had not caused a measurable impact on drinking water sources in the U.S. This and similar conclusions from similar investigations carryhave positive implications for our industry; however, more stringent regulations could be imposed in the future, which could have a material adverse impact on our costs and our business.

The Company has elected the Controlled Corporation exemption under Section 303A of the New York Stock Exchange (NYSE) Listed Company Manual. The Company is a Controlled Corporation because a group that includes Gary W. Rollins, Pamela R. Rollins, Amy Rollins Kreisler and Timothy C. Rollins, each of whom is a director of the Company, certain of their family members and certain companies under their control (the Controlling Group), controls in excess of 50% of the Company’s voting power. As a Controlled Corporation, the Company need not comply with certain NYSE rules including those requiring a majority of independent directors, and independent compensation and nominating committees.

We are beginningin the process of a multi-year implementation of a new ERP.ERP system. The implementation will requirerequires the integration of the new ERP system with multiple new and existing information systems and business processes and needsis to bebeing designed to accurately maintain our books and records and provide information to our management teams for the operation of the business. The implementation of our new ERP willsystem requirerequires new procedures and certain modifications to our disclosure controls and procedures and internal control over financial reportingreporting, and it will take time for such procedures and controls to become mature in their operation. If we are unable to adequately implement and maintain procedures and controls relating to our new ERP,ERP system, our ability to produce timely and accurate financial statements or comply with applicable regulations could be impaired and impact our assessment of the effectiveness of our internal controls over financial reporting.

NetOperating income for 20242025 was $91.4$44.7 million, ora $0.4354.1% earnings per sharedecrease compared to netthe incomeprior of $195.1 million, or $0.90 earnings per share in 2023.year.

Cash flows from operating activities increaseddecreased to $201.3 million in 2025 compared to $349.4 million in 2024 compared to $394.8 million in 2023.2024. During 2024,2025, capital expenditures totaled $219.9$148.4 million whichprimarily included the purchase of a new Tier 4 dual-fuel fleet, coupled withfor capitalized maintenance and upgrades of our existing equipment.equipment, coupled with ERP and other IT system upgrades.

See “Non-GAAP Financial Measures” below for a reconciliation of EBITDA and Adjusted EBITDA to net income, and Adjusted EBITDA margin to net income margin, the most directly comparable financial measure calculated and presented in accordance with GAAP and a reconciliation of Free Cash Flow to Operating Cash Flow, the most directly comparable financial measure calculated and presented in accordance with GAAP.

Cost of revenues. Cost of revenues decreasedincreased 4.9%18.9% to $1.0$1.2 billion for 20242025 compared to the prior year. Cost of revenues decreasedincreased primarily due to reducedcosts from recently acquired Pintail. Excluding results from Pintail, cost of revenues decreased in line with revenues primarily due to a decrease in expenses consistent with lower activity levels, such as materials and suppliessupplies, expensesfleet and transportation and maintenance and repairs expenses. These costs decreased less than the revenue decrease given the fixed nature of some of these costs, including labor, and the timing of maintenance and repairs. In accordance with Staff Accounting Bulletin (SAB) Topic 11.B, cost of revenues presented on the Consolidated Statements of Operations excludes depreciation and amortization totaling $120.6$141.2 million for 2024,2025 compared to $97.7$120.6 million in the prior year.

Selling, general and administrative expenses. Selling, general and administrative expenses decreasedincreased to $156.4$175.6 million in 20242025 compared to $165.9$156.4 million in the prior year. The decreaseincrease was primarily due to aan decreaseincrease in variableemployment related costs coupled with acquisition related costs and expenses consistentfrom withrecently loweracquired activity levels as well as lower incentive compensation.Pintail.

Gain on disposition of assets, net. Gain on disposition of assets, net was $8.2 million in 20242025, comparedconsistent towith athe gain on disposition of assets, net of $9.3$8.2 million in 2023.2024. The gain on disposition of assets, net is generally comprised of gains and losses related to various property and equipment dispositions or sales to customers of lost or damaged rental equipment.

Other income, net. Other income, net was $2.9$6.4 million in 20242025 compared to other income, net of $3.0$2.9 million in the prior year. Other income recorded during 2025 included a property insurance recovery of approximately $2.5 million.

Interest expense and interest income. Interest expense was $724$3.0 thousandmillion in 20242025 compared to $341$724 thousand in the prior year. Interest expense increased primarily due to interest on the Seller Note issued in conjunction with the Pintail acquisition. See “Cash Requirements” below and Note to the consolidated financial statements titled Acquisition for more information regarding the Seller Note. Interest expense includes interest on the Seller Note, facility fees on the unused portion of the credit facility and the amortization of loan origination costs. Interest income increaseddecreased to $13.1$8.4 million compared to $8.6$13.1 million in the prior year primarily due to highera lower average cash balances.balance, primarily due to the acquisition of Pintail on April 1, 2025 and a decrease in net cash provided by operating activities.

Income tax provision. Income tax provision was $21.4$24.5 million during 2024,2025, compared to $61.1$21.4 million tax provision in the prior year. The effective provision rate was 18.9%43.3% for 2024,2025, compared to aan 23.9%18.9% effective provision rate for the prior year. The decreaseincrease in the effective tax rate in 20242025 compared to the prior year is due to the strongsignificant impact of beneficialdetrimental permanent and discrete adjustments on a decreasedlower pretax income.

Adjusted EBITDA and Adjusted EBITDA margin. Adjusted EBITDA was $233.0$232.7 million, and Adjusted EBITDA margin was 16.5%14.3% in 20242025 compared to $374.4$233.0 million and 23.1%16.5% in 2023. The decline in 2024 was primarily due to lower revenues, associated negative operating leverage and fixed cost absorption.2024.

Cash provided by operating activities and Free cash flow. Cash provided by operating activities decreased to $201.3 million in 2025, from $349.4 million in 2024,2024 fromprimarily $394.8due millionto a decrease in 2023.net income, coupled with unfavorable changes in working capital. Free cash flow decreased to $52.9 million in 2025, from $129.5 million in 2024, from $213.8 million in 20232024 primarily due to a decrease in cash provided by operating activities, driven by lower net income partially offset by favorable working capital changes. Free cash flow in 2024 was also impacted by an increase inlower capital expenditures.

Cash provided by operating activities for the year ended December 31, 2024,2025, decreased by $45.4$148.1 million compared to the year ended December 31, 2023,2024, primarily due to a decrease in net income, partiallycoupled offsetwith by favorableunfavorable changes in working capital. ChangesChange in working capital was a sourceuse of cash of $116.7$37.4 million forduring the year ended December 31, 2024,2025, compared to a $116.7 million source of cash of $57.8 million in the same period last year. ChangesThe inmost significant working capital related cash flow during 2025 was a significantcash sourceuse of cash$32.1 million due to a decrease in theunearned current year primarilyrevenue due to the following:satisfaction of performance obligations that were associated with a decreasecustomer ofcash $47.9prepayment millionwe received in taxes receivable including a $52.8 million federal tax refund received during the secondfourth quarter of 2024, coupled with a $48.0 million decrease in accounts receivable.2024. The changes in accounts receivablereceivable, accounts payable and the other components of working capital were primarilymainly due to the timing of payments and receipts. Working capital in the prior year was impacted favorably by the receipt of a $52.8 million federal income tax refund.

Cash used for investing activities for 20242025 decreasedincreased by $40.2$72.1 million compared to 2023,2024, primarily due to cash used to fund the purchaseacquisition of SpinnakerPintail, duringpartially 2023offset (asby therea were no acquisitionsdecrease in 2024).capital expenditures. Capital expenditures were $148.4 million for the year ended December 31, 2025, compared to $219.9 million for the year ended December 31, 2024,2024. comparedIn tothe $181.0prior millionyear, the Company had expenditures for the year ended December 31, 2023. Capital investments during 2024 included the purchasecomponents of a new Tier 4 dual fuel pressure pumping fleet, which replaced a Tier 2 diesel fleet. In addition, certain capital spending items were delayed from 2023 into 2024, which was a contributing factor to the year-over-year increase.

Cash used for financing activities for 20242025 decreased by $11.0$1.6 million primarily due to a decrease in repurchases of the Company’s common shares in the open market.market, partially offset by the repayment of debt assumed at acquisition of Pintail. The Company paid $34.4$35.1 million in dividends and repurchased $9.9$2.9 million of common stock in 20242025 compared to $34.6$34.4 million in dividends paid and $21.1$9.9 million of common stock repurchased in 2023.2024.

The Company’s financial condition remains strong. We believe the liquidity provided by our existing cash and cash equivalents and our overall strong capitalization will provideis sufficient liquidity to meet our requirements for at least the next twelve months. Our material cash requirements, including commitments for capital expenditures, as of the end of the latest fiscal period, are set forth below under “Cash Requirements.” The Company’s decisions about the amount of cash to be used for investing and financing activities are influenced by our capital position, and the expected amount of cash to be provided by operations. RPC does not expect to utilize our revolving credit facility to meet these liquidity requirements in the near term.

The Company currently has a $100.0 million revolving credit facility that matures in June 2027. The facility contains customary terms and conditions, including restrictions on indebtedness, dividend payments, business combinations and other related items. The revolving credit facility includes a full and unconditional guarantee by the Company's 100% owned domestic subsidiaries whose assets equal substantially all of the consolidated assets of the Company and its subsidiaries. Certain of the Company’s minor subsidiaries are not guarantors. The Credit Agreement’s maturity date is June 22, 2027, and the interest rate is based on Term Secured Overnight Financing Rate (Term SOFR). In addition, the terms of the agreement have a 1.00% per annum floor for Base Rate borrowings and permits the issuance of letters of credit in currencies other than U.S. dollars. As of December 31, 2024,2025, RPC had no outstanding borrowings under the revolving credit facility, and letters of credit outstanding relating to self-insurance programs and contract bids totaled $16.3$18.2 million; therefore, a total of $83.7$81.8 million of the facility was available. The Company is currently in compliance with the credit facility financial covenants. For additional information with respect to RPC’s facility, see note to the consolidated financial statements titled Long-TermNotes Debt.Payable.

Material Cash Requirements

The Company currently expects capital expenditures to be between $150 million and $200$180 million in 20252026. andWe expect 2026 capital expenditures to be directed towards both capitalized maintenance of our existing equipment and selected growth opportunities.opportunities Theas Companywell isas allocatingthe capitalupgrade to maintain the capacity of our pressure pumping fleet to offset anticipated future fleet retirementsERP and issupply evaluatingchain future investments and options to further upgrade our equipment across the business.systems.

InDuring the fourth quarter of 2024,2025, the Company enteredcontinued into aits multi-year systems transformation program to upgrade ourits ERP and supply chain systems. We are currently in the early phasessystems and expensedbegan thecapitalizing majority of non-recurringsome costs incurredassociated inwith 2024.ERP implementation. We plan to continue the ERP implementation through a phased approach with costs being incurred over the next few years.approach.

The Company purchases its equipment and materials from suppliers who provide competitive prices and employ skilled workers from competitive labor markets. If inflation in the general economy increases, the Company’s costs for equipment, materials and labor could increase as well. In addition, increases in activity in the domestic oilfield can cause upward wage pressurepressures in the labor markets from which it hires employees, especially if employment in the general economy increases. Also, activity increases can cause supply disruptions and higher costs of certain materials and key equipment components used to provide services to the Company’s customers. In recent years, the price of labor and raw materials haveincreased increased.while Theselabor shortages caused by the departure of skilled labor from the domestic oilfield industry in prior years. The cost increases have moderated but remain high by historical standards. Additionally, tariffs can impact the absolute costs of materials, as well as cause shifts in production to more domestic production adding inflationary pressures to domestic suppliers. Though the ultimate impact is uncertain, the Company does not currently expect tariffs on goods imported into the U.S. to result in materially higher costs of equipment.

The current and projected prices of oil, natural gas and natural gas liquids are important catalysts for U.S. domestic drilling activity and can be impacted by economic and policy developments as well as geopolitical disruptions, such as the continuing conflicts in the Middle East as well as Russia and Ukraine.disruptions. RPC believes that oil prices currently remain aboveat levels sufficient to motivate our customers to maintaincontinue drilling and completion activities.activities, however the recent fluctuations of oil prices and potential further volatility could result in the Company’s customers opting to delay completion activity. Long-term, projected steady higher demand for oil and natural gas should drive increased activity in most of the basins in which RPC operates.

We continue to monitor the supply and demand for our services and the competitive environment, including trends such as increasing customer preferences for lower emission and more efficient equipment. Increased asset efficiencyefficiencies in recent years of oilfield completion fleets,services and equipment, particularly in pressure pumping, has inherently contributed to oversupply in the Oilfield Services (OFS) market. We believe that most of the feasible operating efficiency gains have been realized, but competition is expected towill remain at a high level.intense.

The Company’s obligations and commitments that require future payments include certain non-cancelable leases, purchase obligations, amounts related to the usage of corporate aircraft, distribution related to SERP terminations, ongoing ERP implementationimplementation, letters of credit, the Seller Note and other long-term liabilities. We expect to fund these obligations primarily through cash generated from our operations. See note titled “Leases and note titled Employee Benefit Plans” in the Notes to consolidated financial statements for additional details.

See note titled “Related Party Transactions” in the Notes to consolidated financial statements for a description of related party transactions.

The estimated credit loss allowance is based on our evaluation of the overall trends in the oil and gas industry, financial condition of our customers, our historical write-off experience, current economic conditions, and in the case of international customers, our judgments about the economic and political environment of the related country and region. In addition to reserves established for specific customers, we establish general reserves by using different percentages depending on the age of the receivables which we adjust periodically based on managementmanagement’s judgment and the economic strength of our customers. The net credit loss allowance as a percentage of revenues ranged from 0.4% to 0.8% over the last three years. Increasing or decreasing the estimated general reserve percentage by 0.50 percentage points as of December 31, 2024,2025, would have resulted in a change of approximately $1.1$1.3 million in the recorded provision for current expected credit losses.

Insurance expenses — RPC self-insures certain risks related to general liability, workers’ compensation, vehicle, property, and employee health insurance costs, up to policy-specified deductible limits. For employee health insurance, RPC maintains stop-loss coverage to limit its financial exposure on high-cost claims. The estimated cost of claims under these self-insurance programs is accrued as incurred, though actual settlement may occur in future periods. These estimates may be adjusted over time based on claim developments. Any portion of outstanding claims expected to be paid beyond one year is classified as long-term accrued insurance expenses. These claims are monitored, and the cost estimates are revised as developments occur relating to such claims. The Company has retained an independent third-party actuary to assist in the calculation of a range of exposure for these claims.claims using various actuarial methods including paid and incurred loss development, paid and incurred Bornhuetter-Ferguson, case outstanding loss development and expected loss. As of December 31, 2024,2025, the Company estimates the range of exposure to be from $17.8$19.1 million to $22.3$26.7 million. The Company has recorded liabilities as of December 31, 2024,2025, of $20.1$22.8 million, which represents management’s best estimate of probable loss.

Long-lived assets including goodwill — RPC carries a variety of long-lived assets on its balance sheet including property, plant and equipment and goodwill. Impairment is the condition that exists when the carrying amount of a long-lived asset exceeds its fair value. Goodwill is the excess of the cost of an acquired entity over the net of the amounts assigned to assets acquired and liabilities assumed. The Company conducts impairment tests on goodwill annually during the fourth quarter, or more frequently if events or changes in circumstances indicate an impairment may exist. The Company completes either a qualitative or quantitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. Assessment of goodwill impairment is conducted at the level of each reporting unit. Technical Services and Support Services, comparing the estimated fair value of each reporting unit to the reporting unit’s carrying value, including goodwill. The fair value of each reporting unit is estimated using an income approach and a market approach. The income approach uses discounted cash flow analysis based on management’s short-term and long-term forecast of operating performance. This analysis includes significant assumptions regarding discount rates, revenue growth rates, expected profitability margins, forecasted capital expenditures and the timing of expected future cash flows based on market conditions. If the estimated fair value of a reporting unit exceeds its carrying amount, the goodwill of the reporting unit is not considered impaired. If the carrying amount of a reporting unit exceeds its estimated fair value, an impairment loss is measured and recorded.

Acquisition of business — In accounting for our acquisitions, we evaluate whether a transaction pertains to an acquisition of assets, or to an acquisition of a business. A business is defined as an integrated set of assets and activities that is capable of being conducted and managed for the purpose of providing a return. Asset acquisitions are accounted for by allocating the cost of the acquisition to the individual assets and liabilities assumed on a relative fair value basis; whereas the acquisition of a business requires assets acquired and the liabilities assumed to be recognized at the acquisition date fair values, separately from goodwill. The excess of consideration transferred over the net of the acquisition date fair values of the assets acquired and the liabilities assumed, is recorded as goodwill. The Company uses its best estimates and assumptions to accurately value assets acquired, and liabilities assumed at the acquisition date as well as any contingent consideration, where applicable. However, these estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the business acquisition date, the Company may have to record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of a business acquisition’s measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded in the Consolidated Statements of Operations.

See note titled “Significant Accounting Policies” in the Notes to the consolidated financial statements, which is incorporated herein by reference for a description of recent accounting standards, including the expected dates of adoption and estimated effects on results of operations and financial condition.

Except as set forth below, thereThere have been no material changes from the risk factors previously disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.2025, and the Quarterly Report on Form 10-Q for the quarter ended March 31, 2026.

RPC, Inc. (“RPC” or “the Company”) provides a broad range of specialized oilfield services primarily to independent and major Oilfield companies engaged in exploration, production and development of oil and gas properties throughout the United States, including the Gulf of America, mid-continent, southwest, Rocky Mountain and Appalachian regions, and in selected international locations. The Company’s revenues and profits are generated by providing equipment and services to customers who operate oil and gas properties and invest capital to drill new wells and enhance production or perform maintenance on existing wells. We continuously monitor factors that impact current and expected customer activity levels, such as the prices of oil and natural gas, changes in pricing for our services and equipment, and utilization of our equipment and personnel. Our financial results are affected by geopolitical factors such as political instability in the petroleum-producing regions of the world, the Iran war and related blockade of the Strait of Hormuz and other oil transportation shipping lanes, the actions of the OPEC oil cartel, overall economic conditions and weather in the United States, the prices of oil and natural gas, other shifting trends in our industry, and our customers’ drilling and production activities.

As of MarchJune 31,30, 2026, there were no outstanding borrowings under our credit facility.

We use Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”), Adjusted EBITDA, Adjusted EBITDA margin and Free cash flow, all non-GAAP measures, to evaluate and analyze the operating performance of our businesses. See section titled Non-GAAP financial measures for Adjusted EBITDA, Adjusted EBITDA margin and Free cash flow computations.

These measures should not be considered in isolation or as a substitute for performance or liquidity measures prepared in accordance with GAAP. Management believes that presenting these non-GAAP measures, other than free cash flow, enables investors to compare the operating performance of our core business consistently over various time periods, without regard to acquisition related employment costs and changes in our accounting for purchases of wireline cables, and in the case of Adjusted EBITDA and Adjusted EBITDA margin, without regard to changes in our capital structure. Management believes that free cash flow, which measures our ability to generate additional cash from our business operations, is an important financial measure for use in evaluating RPC's liquidity. Free cash flow should be considered in addition to, rather than as a substitute for, net cash provided by operating activities as a measure of our liquidity. Additionally, RPC’s definition of free cash flow is limited, in that it does not represent residual cash flows available for discretionary expenditures, due to the fact that the measure does not deduct the payments required for debt service and other contractual obligations or payments made for business acquisitions. Therefore, management believes it is important to view free cash flow as a measure that provides supplemental information to our Condensed Consolidated Statements of Cash Flows.

See Non-GAAP Financial Measures below for a reconciliation of EBITDA and Adjusted EBITDA to net income, and Adjusted EBITDA margin to net income margin, the most directly comparable financial measures calculated and presented in accordance with GAAP and a reconciliation of Free Cash FlowProvided by Operating Activities to OperatingFree Cash Flow, the most directly comparable financialliquidity measure calculated and presented in accordance with GAAP.

THREE MONTHS ENDED MARCHJUNE 31,30, 2026, COMPARED TO THREE MONTHS ENDED MARCHJUNE 31,30, 2025 Revenues. Revenues of $454.8$460.9 million for the three months ended MarchJune 31,30, 2026, increased 36.6%9.5% compared to the three months ended MarchJune 31,30, 2025. The increase in revenues was primarily due to revenuesincreased of $97.8 million from Pintail, which was acquired during the second quarter of 2025, coupled with revenue increasesactivities in pressure pumping, downhole tools and coiled tubing.tubing, Thepartially pressureoffset pumpingby marketa remainsdecrease highlyin competitive.wireline activity. Management believes the industryoilfield services completion market continues to be over-supplied and efficiency gains are contributing to excess capacity in the industry. These challengeschallenges, although slight improvements were realized during the quarter, have impacted activity levels, asset utilization, and pricing. International revenues represented 1.5%2.0% of total revenues in the firstsecond quarter of 2026 unchanged compared to 2.4%2.0% in the same period of the prior year. We believe that international revenues will continue to be less than 10% of RPC’s consolidated revenues in the foreseeable future.

During the firstsecond quarter of 2026, the average price of oil was 1.9%49.1% lowerhigher anddue to Middle East supply disruptions, while the average price of natural gas was 16.2%8.1% higher, bothlower, compared to the same period in the prior year. The average domestic rig count (Source: Baker Hughes, Inc.) for the three months ended MarchJune 31,30, 2026, was 6.8%3.0% lower than in the same period in 2025.

The Technical Services segment revenues for the firstsecond quarter of 2026 increased by 39.3%10.4% compared to the same period of the prior year due primarily to theincreased acquisition of Pintail, coupled with an increaseactivities in pressure pumping, downhole tools and coiled tubing revenues. Support Services segment revenues for the firstsecond quarter of 2026 decreased by 2.7%5.4% compared to the same period in the prior year, primarily due to lowerjob pricing within rental tools.mix.

Technical Services reported operating income was $16.0 million during the first quarter of 2026 compared to operating income of $14.0$27.6 million in the firstsecond quarter of 2026, an increase of 30.5% compared to the second quarter of 2025. The increase in Technical Services operating income was primarily due to an increase in downhole tooltools, coiled tubing and pressure pumping activity, partially offset by ana overall weaker pricing environment and unfavorable pressure pumping job mix. The first quarter of 2026 includes operating results of Pintail. Support Services segment revenues for the first quarter of 2026 decreased by 2.7% compared to the same perioddecrease in thewireline prior year, primarily due to lower activity levels within rental tools.activity. Support Services reported operating income of $401 thousand for the first quarter of 2026 compared to operating income of $2.7$2.3 million for the firstsecond quarter of 2025.2026, Firsta quarter 2026 Support Services operating income decreased by $2.3 million compared to the first quarterdecrease of the50.6% priorwhich yearwas primarily due to lower pricing in rental tools and job mix.

Cost of revenues. Cost of revenues increased 45.8%8.8% to $355.6$345.7 million for the three months ended MarchJune 31,30, 2026, compared to $243.9$317.7 million for the three months ended MarchJune 31,30, 2025, primarily due to costs from Pintail, which was acquired during the second quarter of 2025, coupled with increases in expenses consistent with higher activity levels. In accordance with Staff Accounting Bulletin (“SAB”) Topic 11.B, cost of revenues presented on the Consolidated Statements of Operations excludes depreciation and amortization totaling $37.1$37.4 million for the firstsecond quarter of 2026 compared to $32.4$36.6 million for the firstsecond quarter of 2025.

Selling, general and administrative expenses. Selling, general and administrative expenses increased to $48.2$51.5 million for the three months ended MarchJune 31,30, 2026, compared to $42.5$40.8 million for the three months ended MarchJune 31,30, 2025, primarily due to an increase in variable expenses consistent with higher activity levels, coupled with expensesan fromincrease Pintail,in whichprofessional wasand acquiredadvisory during the second quarter of 2025.fees.

Acquisition related employment costs. Acquisition related employment costs of $7.3 million represent non-cash accounting adjustments for costs related to the Pintail acquisition costs that are contingent upon continued employment of certain Pintail employees. These costs include the stock consideration and 50% of the Seller Note paid to the seller as part of acquisition of Pintail that is contingent on the seller’s continued employment. Also included are redistribution payments paid by the seller out of closing cash, the reimbursement of which is subject to the seller’s continued employment with RPC. These costs are amortized over a three-year period.

Depreciation and amortization. Depreciation and amortization increased 20.3%1.5% to $42.9$43.0 million for the three months ended MarchJune 31,30, 2026, compared to $35.6$42.3 million for the three months ended MarchJune 31,30, 2025. Depreciation and amortization increased due to additional fixed assets and intangibles related to the Pintail acquisition, coupled with capital expenditures in the past year.

Gain on disposition of assets, net. Gain on disposition of assets, net was $1.8$1.4 million for the three months ended MarchJune 31,30, 2026, compared to $1.5$2.2 million for the three months ended MarchJune 31,30, 2025. The gain on disposition of assets, net is generally comprised of gains and losses related to various property and equipment dispositions or sales to customers of lost or damaged rental equipment.

Other income, net. Other income, net was $749$929 thousand for the three months ended MarchJune 31,30, 2026, compared to $885$1.2 thousandmillion for the same period in the prior year.

Interest expense and interest income. Interest expense increaseddecreased to $830$671 thousand for the three months ended MarchJune 31,30, 2026, compared to $131$1.0 thousandmillion for the three months ended MarchJune 31,30, 2025. Interest expense increaseddecreased primarily due to interestthe $20.0 million principal payment on the Seller Note issuedrelated in conjunction withto the Pintail acquisition.acquisition, that was made during the second quarter of 2026. Interest expense includes interest on the Seller Note, facility fees on the unused portion of the credit facility and the amortization of the related loan costs. Interest income decreased to $1.8$1.5 million compared to $3.4$1.6 million in the prior year due to a slightly lower average cash balance, primarily due to the acquisition of Pintail during the second quarter of 2025.balance.

Income tax provision. Income tax provision was $3.5$4.5 million during the three months ended MarchJune 31,30, 2026,2026 compared to $4.5$7.2 million tax provision for the same period in 2025.the prior year. The effective tax rate was 80.1%27.1% for the three months ended MarchJune 31,30, 2026,2026 compared to a 27.2%41.3% effective tax rate for the threesame monthsperiod endedin Marchthe 31,prior 2025.year. The increasedecrease in effective tax rate is primarily due to acquisitionthe related employment costs that are permanently nondeductible for tax purposes, which had a disproportionatesmaller impact dueof topermanent loweradjustments on pretax income.

AdjustedOther EBITDAincome, andnet. AdjustedOther EBITDAincome, margin. Adjusted EBITDAnet was $53.5$1.7 million, and Adjusted EBITDA margin was 11.8%million for the threesix months ended MarchJune 31,30, 2026, compared to $48.9$2.0 million and 14.7%, respectively, for the same period in the prior year.

Cash provided by operating activities and Free cash flow. Cash provided by operating activities was $31.2$74.6 million for the threesix months ended MarchJune 31,30, 2026, compared to $39.9$92.9 million for the threesix months ended MarchJune 31,30, 2025. The decrease in cash provided by operating activities is due primarily to unfavorable changes in working capital, coupled with lower net income. Working capital was a use of cash during the currentlast quartersix months primarily due to higher accounts receivable dueconsistent towith higher activity increases.levels. Free cash flow was a use of $0.9$3.8 million for the threesix months ended MarchJune 31,30, 2026, compared to a source of $7.6$17.6 million for the threesix months ended MarchJune 31,30, 2025.

The Company’s cash and cash equivalents decreased $9.2$30.5 million to $200.7$179.5 million as of MarchJune 31,30, 2026, compared to cash and cash equivalents of $210.0 million as of December 31, 2025.

The following table sets forth the historical cash flows for the threesix months ended MarchJune 31,30, 2026, and 2025:

Cash provided by operating activities for the threesix months ended MarchJune 31,30, 2026, decreased by $8.7$18.3 million compared to the threesix months ended MarchJune 31,30, 2025, primarily due to unfavorable changes in working capital, coupled with a decrease in net income. Change in working capital was a use of cash of $21.7$42.6 million during the threesix months ended MarchJune 31,30, 2026, compared to a use of cash of $6.9$14.8 million in the same period last year. The most significant working capital relatedcomponent cash flowchange during the threesix months ended MarchJune 31,30, 2026, was a cash use of $47.1$51.0 million in accounts receivable,receivable. This amount was coupled with cash use of $13.2 million due to the satisfaction of performance obligations that were associated with a customer cash prepayment, partially offset by a cash source of $41.3cash of $26.9 million in accounts payable, bothpayable due to an increase in activity levels, coupled with the timing of payments and receipts.levels. The changes in the other components of working capital were mainly due to the timing of payments and receipts.

Cash used for investing activities for the threesix months ended MarchJune 31,30, 2026, increaseddecreased by $0.4$168.1 million compared to the threesix months ended MarchJune 31,30, 2025, primarilyas duecash was used to fund the Pintail acquisition during 2025. This was coupled with a decrease in proceeds from sale of assets, partially offset by a slight decrease in capital expenditures primarily related to the timing of new equipment deliveries. Capital expenditures were $32.1$70.8 million for the threesix months ended MarchJune 31,30, 2026, a decrease compared to $32.3$75.3 million for the threesix months ended MarchJune 31,30, 2025.

Cash used for financing activities for the threesix months ended MarchJune 31,30, 2026, increased by $0.9$16.4 million compared to the threesix months ended MarchJune 31,30, 2025, primarily due to anthe increase$20.0 inmillion repurchasesprincipal ofpayment on the Company’sSeller shares for taxesNote related to the vestingPintail acquisition, that was made during the second quarter of restricted shares.2026.

The majority of ourOur cash and cash equivalents are held at multiple financial institutions, eachmany of which holdshold funds in excess of amounts insured by the Federal Deposit Insurance Corporation (“FDIC”). These financial institutions are among the largest in the United States and we believe are a safe place to hold our deposits.

The Company currentlyamended hasits acredit agreement during the second quarter of 2026 to, among other things, extend the maturity date for revolving loans from June 22, 2027 to June 30, 2031. The $100.0 million revolving credit facility that matures in June 2027. The facility contains customary terms and conditions, including restrictions on indebtedness, dividend payments, business combinations and other related items.items, as well as providing for acceleration of amounts due upon the occurrence of certain specified events of default. The revolving credit facility includes a full and unconditional guarantee by the Company's 100% owned domestic subsidiaries whose assets equal substantially all of the consolidated assets of the Company and its subsidiaries. Certain of the Company’s minor subsidiaries are not guarantors. The Credit Agreement’s maturity date is June 22,30, 2027,2031, and the interest rate is based on Term Secured Overnight Financing Rate (Term SOFR). In addition, the terms of the agreement have a 1.00% per annum floor for Base Rate borrowings and permits the issuance of letters of credit in currencies other than U.S. dollars. As of MarchJune 31,30, 2026, RPC had no outstanding borrowings under the revolving credit facility, and letters of credit outstanding relating to self-insurance programs and contract bids totaled $18.2 million; therefore, a total of $81.8 million of the facility was available. The Company is currently in compliance with the credit facility financial covenants. For additional information with respect to RPC’s facility, see note to the consolidated financial statements titled “Notes Payable.”

The Company has a shelf registration statement on Form S-3 filed with the Securities and Exchange Commission (“SEC”) that expires on May 5, 2028, which permits it to offer common stock, preferred stock, warrants, rights, depositary shares, purchase contracts and units containing two or more of the foregoing, in one or more offerings in an aggregate amount of up to $300 million. The Form S-3 is intended to provide us the flexibility to conduct registered sales of our securities, subject to market conditions and our future capital needs.

The Company currently expects capital expenditures to be between $160$170 million and $180$190 million infor 2026. We expect capital expenditures to be directed towards capitalized maintenance of our existing equipment and selected growth opportunities as well as the upgrade to our Enterprise Resource Planning (“ERP and supply chain”) systems. AsFor the six months ended June 30, 2026, $70.8 million of Marchcapital 31, 2026, $32.1 millionexpenditures had been spent.incurred.

During 2026, theThe Company continuedcontinues its multi-year systems transformation program to upgrade its ERP and supply chain systems and continueshas to capitalizecapitalized some costs associated with ERPsystems implementation. We plan to continue the ERPsystems implementation through a phased approach.

As noted above, the Company issuedassumed a Seller Note in connection with the Pintail Acquisition. The Seller Note matures on April 1, 2028, and provides for specified principal payments to be made annually through the third anniversary of the acquisition. The first principal payment of $20 million will bewas made onduring Maythe 11,second quarter of 2026. Interest on the Seller Note accrues at a variable rate equal to the SOFR for the applicable interest period, plus 2.0% per annum, or where applicable, at a specified default rate. For the firstsecond quarter of 2026, interest payments paid on the Seller Note totaled approximately $704$548 thousand. The Seller Note provides for principal reduction or cancellation upon certain events related to the employment of one of the sellers.

As of MarchJune 31,30, 2026 letters of credit outstanding relating to self-insurance programs and contract bids totaled $18.2 million.

The Company has a stock buyback program with authorization to repurchase up to 49,578,125 shares in the open market. There were no shares repurchased on the open market during the firstsecond quarter of 2026, and 12,768,870 shares remained available tofor be repurchasedrepurchase under the current authorization as of MarchJune 31,30, 2026. The Company may repurchase outstanding common shares periodically based on market conditions and our capital allocation strategies. The stock buyback program does not have a predetermined expiration date. For additional information with respect to RPC’s stock buyback program, see note to the consolidated financial statements titled “Cash Paid for Common Stock Purchased and Retired.”

On AprilJuly 28, 2026, the Board of Directors declared a regular quarterly cash dividend of $0.04 per share payable JuneSeptember 10, 2026, to common stockholders of record at the close of business on MayAugust 8,10, 2026. The Company expects to continue to pay cash dividends to common stockholders, subject to industry conditions and RPC’s earnings, financial condition, and other relevant factors.

The Company purchases its equipment and materials from suppliers who provide competitive prices and employ skilled workers from competitive labor markets. If inflation in the general economy increases, the Company’s costs for equipment, materials and labor could increase as well. In addition, increases in activity in the domestic oilfield can cause upward wage pressures in the labor markets from which it hires employees, especially if employment in the general economy increases. Also, activity increases can cause supply disruptions and higher costs of certain materials and key equipment components used to provide services to the Company’s customers. In recent years, the price of labor and raw materials has increased. The cost increases have moderated but remain high by historical standards. Additionally, tariffs can impact the absolute costscost of materials, equipment and components, as well as cause shifts in productioncontribute to moresupply domesticchain productiondisruptions addingand inflationary pressures toon domestic suppliers. Though the ultimate impact is uncertain,While the Company doeshas not currentlyexperienced expecta material impact from tariffs onto goods imported intodate, the U.S.future toeffect of tariffs and other trade-related measures remains uncertain and could result in materially higher costscosts, reduced availability of equipment.certain materials and equipment, or other operational challenges.

The current and projected prices of oil, natural gas and natural gas liquids are important catalysts for U.S. domestic drilling activity and can be impacted by economic and policy developments as well as geopolitical disruptions. RPC believes thatcurrent oilcommodity prices currently remain atsupportive levels sufficient to continueof drilling and completion activities,activity howeverlevels. theWhile recent fluctuationsvolatility ofin oil prices and potentialbroader furthermacroeconomic volatilityuncertainty could result in the Company’scause customers opting to delay completionor activity.modify Long-term,planned projectedactivity, higherthe demandCompany forhas oilobserved improving pricing trends and naturalactivity gas should drive increased activityvisibility in mostcertain ofservice thelines basinsduring inrecent which RPC operates.months. Recent geopolitical events in the Middle East have added new dynamics to the global market where infrastructure and physical supply have been restricted. Depending on the duration of thethese conflict’s impacts,conflicts, activity outside of the Middle East could benefit.

We continue to monitor the supply and demand for our services and the competitive environment, including trends such as increasing customer preferences for more efficient equipment. Increased efficiencies in recent years of oilfield completion services and equipment, particularly in pressure pumping, has inherently contributed to oversupply in the Oilfieldoilfield Services (OFS)services market. We believe that competition will remain intense.