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Mar 31, 2024
Ranger Energy Services Q1 2024 Earnings Report
Ranger Energy Services reported a decrease in revenue and net loss compared to the previous year, impacted by challenges in the completions market and weather-related events.
Key Takeaways
Ranger Energy Services reported a revenue of $136.9 million for Q1 2024, a 13% decrease compared to Q1 2023. The company experienced a net loss of $0.8 million, a decrease from a net income of $6.2 million in the prior year. Adjusted EBITDA decreased by 46% to $10.9 million. Despite these challenges, the company generated positive free cash flow of $5.5 million and repurchased shares worth $8.5 million.
Revenue decreased by 13% year-over-year to $136.9 million due to declines in wireline completions and ancillary services.
Net loss was $0.8 million, a decrease from net income of $6.2 million in the first quarter of 2023.
Adjusted EBITDA decreased by 46% to $10.9 million.
The company repurchased 846,900 shares for a total value of $8.5 million.
Ranger Energy Services
Ranger Energy Services
Ranger Energy Services Revenue by Segment
Revenue by Segment
High-Specification Rigs Revenue
CapyFin.comWireline Services Revenue
CapyFin.comProcessing & Ancillary Revenue
CapyFin.com Forward Guidance
Ranger anticipates modest year-over-year growth in its High Specification Rigs and Processing and Ancillary Services segments. The company expects increasing strength in revenue and margins, with a resumption of historical margin averages through the summer and into the fall. The company will focus on strong conversion of EBITDA to Free Cash Flow and return of capital to shareholders.
Positive Outlook
- High Specification Rigs business is expected to grow modestly year over year.
- Processing and Ancillary Services segment is anticipated to show very modest year over year growth.
- March results showed significant revenue and margin improvements.
- Consolidated April results are expected to show increasing strength on the top line with resumption of historical margin averages.
- Strong conversion of EBITDA to Free Cash Flow through effective capital expense management will continue to provide a strong return of capital to Ranger shareholders during the year.
Challenges Ahead
- Operator activity levels are likely to remain flat during 2024.
- Processing and Ancillary Services growth will be largely dependent on customer behavior at the end of this year.
- Depressed margins and activity levels in both January and February.
- The company experienced a material downtime event during the first quarter of 2024 due to a safety event that occurred on a non-Ranger rig that was out of our control as well as weather related downtime.
- 24-hour completion High Specification Rigs work, constituting approximately 30% of our rig activity, completed several rig transitions during the first quarter of 2024 which also negatively impacted segment margins.
Revenue & Expenses
Visualization of income flow from segment revenue to net income