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BUSINESS SEGMENT INFORMATION

3 Months Ended

Mar. 31, 2018

BUSINESS SEGMENT INFORMATION

BUSINESS SEGMENT INFORMATION

6.

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 closely aligned with the customers’ drilling activities. Selected overhead including centralized support services and regulatory compliance are classified as Corporate.

Technical Services consists primarily of pressure pumping, downhole tools, coiled tubing, 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)		2018				2017
Technical Services:
Pressure Pumping		$	256,155			$	182,933
Downhole Tools			93,041				52,345
Coiled Tubing			25,196				21,379
Nitrogen			11,431				8,676
Snubbing			3,973				5,643
All other			29,267				15,222
Total Technical Services		$	419,063			$	286,198
Support Services:
Rental Tools		$	10,020			$	5,389
All other			7,251				6,532
Total Support Services		$	17,271			$	11,921
Total revenues		$	436,334			$	298,119

The following summarizes revenues for the United States and separately for all international locations combined for the three months ended March 31, 2018. 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 percent of RPC’s consolidated assets, and therefore are not presented.

		Three months ended
		March 31,
(in thousands)		2018				2017
United States revenues		$	417,385			$	284,432
International revenues			18,949				13,687
Total revenues		$	436,334			$	298,119

The accounting policies of the reportable segments are the same as those described 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, 2018 and 2017 are shown in the following table:

		Three months ended
		March 31,
(in thousands)		2018				2017
Revenues:
Technical Services		$	419,063			$	286,198
Support Services			17,271				11,921
Total revenues		$	436,334			$	298,119
Operating income (loss):
Technical Services		$	65,005			$	9,205
Support Services			(905	)			(5,221	)
Corporate			(4,665	)			(3,927	)
Gain on disposition of assets, net			1,363				1,517
Total operating income		$	60,798			$	1,574
Interest expense			(105	)			(103	)
Interest income			402				129
Other income, net			5,395				212
Income before income taxes		$	66,490			$	1,812

As of and for the three months ended March 31, 2018		Technical Services				Support Services				Corporate				Total
(in thousands)
Depreciation and amortization		$	33,937			$	3,432			$	111			$	37,480
Capital expenditures			48,551				1,406				525				50,482
Identifiable assets		$	933,979			$	73,801			$	173,237			$	1,181,017

As of and for the three months ended March 31, 2017		Technical Services				Support Services				Corporate				Total
(in thousands)
Depreciation and amortization		$	39,494			$	5,052			$	117			$	44,663
Capital expenditures			9,766				1,909				32				11,707
Identifiable assets		$	782,778			$	74,631			$	191,645			$	1,049,054