Ranger Energy Services Inc

Previous wording

The outlook for the majority of the Company’s business lines remains stable. Despite drilling and completion activity declines during 2023, the Company was able to maintain consistent performance through most quarters with declines in some service line occurring at the start of 2024 due to increased competition and seasonality. Activity levels have since recovered in most service lines and, going forward, we anticipate the global economy and, commodity prices as a consequence, will show continued stability providing a constructive demand backdrop for our services. OPEC+ production cuts have continued and are expected to keep commodity prices at a stable level through the remainder of 2024. Furthermore, both EIA and OPEC+ are projecting for global oil inventories to decline due to flat production and increasing oil consumption in 2024. OPEC+ is projecting oil demand to rise by 2.25 million barrels per day in 2024 and by 1.85 million barrels per day in 2025, driving continued investment and growth in the sector. Consolidation occurring at the E&P operator level within the energy industry is expected to impact U.S. onshore activity levels although the full extent of this impact is not yet known. The Company does expect that short to medium term activity will be varied from this consolidation but, over the long-term, the Company expects favorable preference from these larger organizations where the well-established processes and systems of Ranger are more valued.

Current wording

The outlook for the majority of the Company’s service lines remains stable. Despite drilling and completion activity declines during 2023, the Company was able to maintain consistent performance through most quarters with declines in some service line occurring at the start of 2024 due to increased competition, reduced activity levels and typical seasonality. Activity levels have since recovered in most service lines and, going forward, we anticipate the global economy and, commodity prices as a consequence, will show continued stability providing a constructive demand backdrop for our services. OPEC+ production cuts have continued and are expected to keep commodity prices at a stable level through the remainder of 2024. Furthermore, both EIA and OPEC+ are projecting for global oil inventories to decline due to flat production and increasing oil consumption in 2024. OPEC+ is projecting oil demand to rise by 2.25 million barrels per day in 2024 and by 1.85 million barrels per day in 2025, driving continued investment and growth in the sector. Consolidation occurring at the E&P operator level within the energy industry is expected to impact U.S. onshore activity levels although the full extent of this impact is not yet known. The Company does expect that short to medium term activity will be varied from this consolidation but, over the long-term, the Company expects favorable preference from these larger organizations where the well-established processes and systems of Ranger are more valued.

Previous wording

We view Adjusted EBITDA, which is a non‑GAAP financial measure, as an important indicator of performance. We define Adjusted EBITDA as net income or loss before net interest expense, income tax expense or benefit, depreciation and amortization, equity‑based compensation, acquisition‑related costs, severance and reorganization costs, gain or loss on disposal of property and equipment, and certain other non‑cash and certain other items that we do not view as indicative of our ongoing performance. See “—Results of Operations” and “—Note Regarding Non‑GAAP Financial Measure” for more information and reconciliations of net income (loss) to Adjusted EBITDA, the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP.

Current wording

We view Adjusted EBITDA, which is a non‑GAAP financial measure, as an important indicator of performance. We define Adjusted EBITDA as net income or loss before net interest expense, income tax expense, depreciation and amortization, equity‑based compensation, acquisition‑related costs, severance and reorganization costs, gain or loss on disposal of property and equipment, and certain other non‑cash and certain other items that we do not view as indicative of our ongoing performance. See “—Results of Operations” and “—Note Regarding Non‑GAAP Financial Measure” for more information and reconciliations of net income (loss) to Adjusted EBITDA, the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP.

Previous wording

Revenue. Revenue for the three months ended March 31, 2024 decreased $20.6 million, or 13%, to $136.9 million from $157.5 million for the three months ended March 31, 2023. The change in revenue by segment was as follows:

Current wording

Revenue. Revenue for the three months ended June 30, 2024 decreased $25.1 million, or 15%, to $138.1 million from $163.2 million for the three months ended June 30, 2023. The change in revenue by segment was as follows:

Previous wording

Wireline Services. Wireline Services revenue for the three months ended March 31, 2024 decreased $17.1 million, or 34%, to $32.8 million from $49.9 million for the three months ended March 31, 2023. The decreased revenue was primarily attributable to a decrease in completion services revenue of $15.8 million where there was a 47% decrease in completed stage counts to 3,400 for the three months ended March 31, 2024 from 6,400 for the three months ended March 31, 2023. This decrease in completion services and stage count is indicative of lower operational activity reflecting the Company’s decision to pursue only work with appropriate margins and was due to both the Company's decision to close the completions service line in the South region, as part of a shift in activity from completions work to production, and additional competitive dynamics entering the North region during the three months ended March 31, 2024. Pump down services revenue decreased $0.3 million and production services decreased $1.0 million due to lower seasonal demand than during the prior year quarter. The Company has made a series of adjustments for the three months ended March 31, 2024 to the fixed costs associated with Wireline Services lines to improve margins on a go-forward basis.

Current wording

Wireline Services. Wireline Services revenue for the three months ended June 30, 2024 decreased $30.0 million, or 55%, to $24.5 million from $54.5 million for the three months ended June 30, 2023. The decreased revenue was primarily attributable to a decrease in completion services revenue of $30.7 million where there was a 77% decrease in completed stage counts to 1,700 for the three months ended June 30, 2024 from 7,400 for the three months ended June 30, 2023. This decrease in completion services revenue and stage count is indicative of lower operational activity reflecting the Company’s decision to pursue only work with appropriate margins in the North region and the Company's decision to close the completions service line in the South region. Wireline production services and pump down revenue increased year over year by a net of $0.8 million reflecting increased operational activity offset by market pricing pressure.

Previous wording

Processing Solutions and Ancillary Services. Processing Solutions and Ancillary Services revenue for the three months ended March 31, 2024 decreased $5.7 million, or 19%, to $24.4 million from $30.1 million for the three months ended March 31, 2023. The decrease in revenue is primarily attributable to decreased activity in our coil tubing service lines and snubbing services, which amounted to decreased revenue of $4.5 million and $0.8 million, respectively. Coil tubing services revenue declined in the North region due to increased competition from lower-priced units during the winter and seasonal lulls in activity. The Company has seen a recovery in coil tubing activity beginning in April 2024 along with increasing activity in other Ancillary Services lines.

Current wording

Processing Solutions and Ancillary Services. Processing Solutions and Ancillary Services revenue for the three months ended June 30, 2024 decreased $0.2 million, or 1%, to $30.9 million from $31.1 million for the three months ended June 30, 2023. The decrease in revenue is primarily attributable to decreased activity in our coil tubing service lines and snubbing services, which amounted to decreased revenue of $0.8 million and $0.4 million, respectively. Coil tubing services revenue declined in the North region due to increased competition from lower-priced units early in the quarter resulting in reduced activity levels. The Company has seen a recovery in coil tubing activity in recent months. These revenue declines were offset by increases in revenue within logistics, rentals, and plugging and abandonment by $0.6 million, $0.3 million, and $0.3 million, respectively.

Previous wording

Cost of services (exclusive of depreciation and amortization). Cost of services for the three months ended March 31, 2024 decreased $10.1 million, or 8%, to $120.8 million from $130.9 million for the three months ended March 31, 2023. As a percentage of revenue, cost of services was 88% and 83% for the three months ended March 31, 2024 and 2023, respectively. The change in cost of services by segment was as follows:

Current wording

Cost of services (exclusive of depreciation and amortization). Cost of services for the three months ended June 30, 2024 decreased $23.1 million, or 17%, to $113.2 million from $136.3 million for the three months ended June 30, 2023. As a percentage of revenue, cost of services was 82% and 84% for the three months ended June 30, 2024 and 2023, respectively. The change in cost of services by segment was as follows:

Previous wording

High Specification Rigs. High Specification Rigs cost of services for the three months ended March 31, 2024 increased $6.2 million, to $66.3 million from $60.1 million for the three months ended March 31, 2023. The increase was primarily attributable to an increase in variable expenses, notably employee-related labor costs, travel costs, and repair and maintenance costs of $4.6 million, $0.8 million and $0.7 million, respectively. As a percentage of High Specification Rigs revenue, cost of services increased 5% from the prior year period, due to an increase in medical costs of $1.6 million as well as the holding of crew and associated costs during periods of downtime and weather.

Current wording

High Specification Rigs. High Specification Rigs cost of services for the three months ended June 30, 2024 increased $3.3 million, to $65.3 million from $62.0 million for the three months ended June 30, 2023. The increase was primarily attributable to an increase in variable expenses, notably employee-related labor costs, repair and maintenance costs, and travel costs of $1.9 million, $0.6 million and $0.5 million, respectively. As a percentage of High Specification Rigs revenue, cost of services improved from 80% for the three months ended June 30, 2023 to 79% for the three months ended June 30, 2024.

Previous wording

Wireline Services. Wireline Services cost of services for the three months ended March 31, 2024 decreased $13.1 million, or 29%, to $32.6 million from $45.7 million for the three months ended March 31, 2023. The decrease in wireline services cost of sales was primarily attributable to declines in completion services costs of $15.0 million as the Company reorganized this service line during the year to focus on more profitable service lines. As a percentage of Wireline Services revenue, cost of services increased from 92% for the three months ended March 31, 2023 to 99% for the three months ended March 31, 2024 primarily due to declining operating leverage due to lower activity levels. The Company completed further restructurings and cost reductions in this segment during the first quarter of 2024 to improve profitability going forward.

Current wording

Wireline Services. Wireline Services cost of services for the three months ended June 30, 2024 decreased $24.6 million, or 50%, to $24.2 million from $48.8 million for the three months ended June 30, 2023. The decrease in wireline services cost of sales was primarily attributable to declines in completion services costs of $26.8 million as the Company reorganized this service line during the year to align with lower operating levels. As a percentage of Wireline Services revenue, cost of services increased from 90% for the three months ended June 30, 2023 to 99% for the three months ended June 30, 2024 primarily due to declining operating leverage due to lower activity levels.

Previous wording

General & Administrative. General and administrative expenses for the three months ended March 31, 2024 decreased $1.7 million, or 20%, to $6.7 million from $8.4 million for the three months ended March 31, 2023. The decrease in general and administrative expenses is primarily due to decreased employee costs and legal expenses for the three months ended March 31, 2024.

Current wording

General & Administrative. General and administrative expenses for the three months ended June 30, 2024 decreased $0.4 million, or 5%, to $6.9 million from $7.3 million for the three months ended June 30, 2023. The decrease in general and administrative expenses is primarily due to decreased employee costs attributable to cost reduction activities.

Previous wording

Interest Expense, net. Interest expense, net for the three months ended March 31, 2024 decreased $0.4 million, or 33%, to $0.8 million from $1.2 million for the three months ended March 31, 2023. The decrease to net interest expense was attributable to reduced borrowings.

Current wording

Interest Expense, net. Interest expense, net for the three months ended June 30, 2024 decreased $0.3 million, or 33%, to $0.6 million from $0.9 million for the three months ended June 30, 2023. The decrease to net interest expense was attributable to reduced borrowings on the Wells Fargo Revolving Credit Facility offset by increased borrowing costs on finance leases.

Previous wording

Depreciation and Amortization. Depreciation and amortization for the three months ended March 31, 2024 increased $1.2 million, or 12%, to $11.2 million from $10.0 million for the three months ended March 31, 2023. The increase was attributable to capital expenditures added during the latter half of 2023 into 2024.

Current wording

Depreciation and Amortization. Depreciation and amortization for the six months ended June 30, 2024 increased $3.5 million, or 19%, to $22.2 million from $18.7 million for the six months ended June 30, 2023. The increase was attributable to capital expenditures added during the latter half of 2023 into 2024.

Previous wording

Income Tax Expense or Benefit. Income tax expense for the three months ended March 31, 2024 decreased $2.3 million, or 128%, to a tax benefit of $0.5 million from a tax expense of $1.8 million for the three months ended March 31, 2023. The decrease in tax expense was attributable to the increase in net operating loss utilization in the current quarter, coupled with a decrease in net income.

Current wording

Income Tax Expense. Income tax expense for the six months ended June 30, 2024 decreased $2.3 million, or 61%, to $1.5 million from $3.8 million for the six months ended June 30, 2023. The decrease in tax expense was attributable to the decrease in income and operating activity from the prior year.

Previous wording

Net Income (loss). Net loss for the three months ended March 31, 2024 decreased $7.0 million, or 113%, to a loss of $0.8 million from an income of $6.2 million for the three months ended March 31, 2023. The decrease in net income was primarily driven by reduced activity in Wireline Services and Processing Solutions and Ancillary Services segments.

Current wording

Net Income. Net income for the six months ended June 30, 2024 decreased $8.4 million, or 68%, to $3.9 million from $12.3 million for the six months ended June 30, 2023. The decrease in net income was primarily driven by reduced activity in Wireline Services and Processing Solutions and Ancillary Services segments.

Previous wording

Adjusted EBITDA is not a financial measure determined in accordance with U.S. GAAP. We define Adjusted EBITDA as net income or loss before net interest expense, income tax expense or benefit, depreciation and amortization, equity-based compensation, gain or loss on disposal of property and equipment, acquisition costs, severance and reorganization costs, and certain other non-cash and certain other items that we do not view as indicative of our ongoing performance.

Current wording

Adjusted EBITDA is not a financial measure determined in accordance with U.S. GAAP. We define Adjusted EBITDA as net income or loss before net interest expense, income tax expense, depreciation and amortization, equity-based compensation, gain or loss on disposal of property and equipment, acquisition related costs, severance and reorganization costs, and certain other non-cash and certain other items that we do not view as indicative of our ongoing performance.

Previous wording

Adjusted EBITDA for the three months ended March 31, 2024 decreased $9.2 million to $10.9 million from $20.1 million for the three months ended March 31, 2023. The change by segment was as follows:

Current wording

Adjusted EBITDA for the three months ended June 30, 2024 decreased $0.9 million to $21.0 million from $21.9 million for the three months ended June 30, 2023. The change by segment was as follows:

Previous wording

High Specification Rigs. High Specification Rigs Adjusted EBITDA for the three months ended March 31, 2024 decreased $3.8 million to $13.6 million from $17.4 million for the three months ended March 31, 2023, due to an increase in cost of services of $6.2 million, slightly offset by increased revenue of $2.2 million. The primary driver of increasing costs was carrying of crew and associated rig costs during periods of downtime during the first quarter of 2024 as well as inflationary pressures year over year.

Current wording

High Specification Rigs. High Specification Rigs Adjusted EBITDA for the three months ended June 30, 2024 increased $3.1 million to $18.7 million from $15.6 million for the three months ended June 30, 2023, due to increased revenue of $5.1 million, partially offset by a corresponding increase in cost of services of $3.3 million.

Previous wording

Wireline Services. Wireline Services Adjusted EBITDA for the three months ended March 31, 2024 decreased $4.0 million to $0.2 million from $4.2 million for the three months ended March 31, 2023, due to decreased operating activity resulting in revenue declines of $17.1 million, partially offset by a corresponding decrease in cost of services of $13.1 million.

Current wording

Wireline Services. Wireline Services Adjusted EBITDA for the three months ended June 30, 2024 decreased $5.3 million to $0.4 million from $5.7 million for the three months ended June 30, 2023, due to decreased operating activity resulting in revenue declines of $30.0 million, partially offset by a corresponding decrease in cost of services of $24.6 million.

Previous wording

Other. Other Adjusted EBITDA for the three months ended March 31, 2024 improved $1.1 million to a loss of $5.4 million from a loss of $6.5 million for the three months ended March 31, 2023 due to lower general and administrative costs year over year. The balances included in Other reflect other general and administrative costs, which are not directly attributable to High Specification Rigs, Wireline Services or Processing Solutions and Ancillary Services.

Current wording

Other. Other Adjusted EBITDA for the three months ended June 30, 2024 increased $0.4 million to a loss of $5.4 million from a loss of $5.0 million for the three months ended June 30, 2023. The balances included in Other reflect other general and administrative costs, which are not directly attributable to High Specification Rigs, Wireline Services or Processing Solutions and Ancillary Services.

Previous wording

We require capital to fund ongoing operations, including maintenance expenditures on our existing fleet and equipment, organic growth initiatives, investments and acquisitions. Our primary sources of liquidity have historically been cash generated from operations and borrowings under our credit facilities. As of March 31, 2024, we had total liquidity of $66.5 million, consisting of $11.1 million of cash on hand and availability under our Wells Fargo Revolving Credit Facility of $55.4 million. Under the Wells Fargo Revolving Credit Facility, the total loan capacity was $58.6 million, net of $3.2 million of Letters of Credit open under the facility. This compares to the Company’s available borrowings under the EBC Revolving Credit Facility of $55.6 million and $69.4 million as of March 31, 2023 and December 31, 2023, respectively. We strive to maintain financial flexibility and proactively monitor potential capital sources to meet our investment and target liquidity requirements that permit us to manage the cyclicality associated with our business. We currently expect to have sufficient funds to meet the Company’s short and long term liquidity requirements and comply with our covenants of our debt agreements. For further details, see “— Debt Agreements.”

Current wording

We require capital to fund ongoing operations, including maintenance expenditures on our existing fleet and equipment, organic growth initiatives, investments and acquisitions. Our primary sources of liquidity have historically been cash generated from operations and borrowings under our credit facilities. As of June 30, 2024, we had total liquidity of $72.2 million, consisting of $8.7 million of cash on hand and availability under our Wells Fargo Revolving Credit Facility of $63.5 million. Under the Wells Fargo Revolving Credit Facility, the total loan capacity was $66.7 million, net of $3.2 million of Letters of Credit open under the facility. This compares to the Company’s available borrowings under the Wells Fargo Revolving Credit Facility of $64.3 million as of June 30, 2023 and $69.4 million as of December 31, 2023. We strive to maintain financial flexibility and proactively monitor potential capital sources to meet our investment and target liquidity requirements that permit us to manage the cyclicality associated with our business. We currently expect to have sufficient funds to meet the Company’s short and long term liquidity requirements and comply with our covenants of our debt agreements. For further details, see “— Debt Agreements.”

Previous wording

Net cash from operating activities decreased $5.4 million to $12.0 million for three months ended March 31, 2024 compared to $17.4 million for the three months ended March 31, 2023. The change in cash flows from operating activities is primarily attributable to a decrease in operating income for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. Cash created from working capital increased $3.3 million to $2.2 million for the three months ended March 31, 2024, compared to the use of working capital of $1.1 million for the three months ended March 31, 2023 due to improvements in collections activities in the most recent quarter.

Current wording

Net cash from operating activities decreased $6.8 million to $34.1 million for six months ended June 30, 2024 compared to $40.9 million for the six months ended June 30, 2023. The change in cash flows from operating activities is primarily attributable to a decrease in operating income for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. Cash created from working capital increased $1.8 million to $4.0 million for the six months ended June 30, 2024, compared to $2.2 million for the six months ended June 30, 2023 due to improvements in collections activities in the most recent quarter.

Previous wording

Net cash used in investing activities increased $4.6 million to $5.7 million for three months ended March 31, 2024 compared to $1.1 million for the three months ended March 31, 2023. The change in cash flows from investing activities is largely attributable to slight increases in fixed asset additions that took place during the three months ended March 31, 2024 and less proceeds from asset disposals relative to those that occurred during the three months ended March 31, 2023.

Current wording

Net cash used in investing activities increased $12.1 million to $20.3 million for six months ended June 30, 2024 compared to $8.2 million for the six months ended June 30, 2023. The change in cash flows from investing activities is largely attributable to slight increases in fixed asset additions that took place during the six months ended June 30, 2024 and less proceeds from asset disposals relative to those that occurred during the six months ended June 30, 2023.

Previous wording

Net cash used in financing activities increased $5.3 million from $5.6 million for the three months ended March 31, 2023 to $10.9 million for the three months ended March 31, 2024. Cash used in financing activities for the three months ended March 31, 2024 primarily was allocated to the repurchase of Class A Common Stock (see Item 1. Financial Information— Note 10 — Equity). The Company consolidated its debt and repaid the Revolving Credit Facility, M&E Term Loan Facility, and the Secured Promissory Note with borrowings from the new Wells Fargo Revolving Credit Facility (see Item 1. Financial Information— Note 9 — Debt). The repayment is primarily attributable to the increased ability to pay down debt in 2023 with proceeds from operating activities.

Current wording

Net cash used in financing activities decreased $9.2 million from $30.0 million for the six months ended June 30, 2023 to $20.8 million for the six months ended June 30, 2024. Cash used in financing activities for the six months ended June 30, 2024 primarily was allocated to the repurchase of Class A Common Stock (see Item 1. Financial Information— Note 10 — Equity).

Previous wording

During the three months ended March 31, 2024, the Company added fixed assets of $0.8 million and $2.6 million primarily related to finance leased assets and asset trades, respectively, across all operating segments.

Current wording

During the six months ended June 30, 2024, the Company added fixed assets of $3.6 million and $4.2 million primarily related to finance leased assets and asset trades, respectively, across all operating segments.

Previous wording

Our working capital, which we define as total current assets less total current liabilities, was $58.5 million as of March 31, 2024, compared to $66.4 million as of December 31, 2023. The decrease in working capital can be attributed to a lower cash and accounts receivable balance, offset by a lower accounts payable balance.

Current wording

Our working capital, which we define as total current assets less total current liabilities, was $52.9 million as of June 30, 2024, compared to $66.4 million as of December 31, 2023. The decrease in working capital can be attributed to a lower cash and accounts receivable balance, offset by a lower accounts payable balance.

Previous wording

On May 31, 2023, the Company entered into a Credit Agreement with Wells Fargo Bank, N.A., providing the Company with a secured credit facility (“Wells Fargo Revolving Credit Facility”) in an aggregate principal amount of $75 million. Debt under the Credit Agreement is secured by a lien on substantially all of the Company’s assets. The Company was in compliance with the Credit Agreement covenant by maintaining a fixed charge coverage ratio of greater than 1.0 as of March 31, 2024.

Current wording

On May 31, 2023, the Company entered into a Credit Agreement with Wells Fargo Bank, N.A., providing the Company with a secured credit facility (“Wells Fargo Revolving Credit Facility”) in an aggregate principal amount of $75 million. Debt under the Credit Agreement is secured by a lien on substantially all of the Company’s assets. The Wells Fargo Credit Agreement requires the Company to maintain a Fixed Cost Coverage Ratio (“FCCR”) of greater than 1.0 and as of June 30, 2024, the Company had a Fixed Charge Coverage Ratio of 0.8. The ratio was primarily impacted by lower EBITDA in the first quarter of 2024 and concentrated share buybacks and dividends in the trailing twelve months. While the Company did not meet the minimum required ratio, a Covenant Testing Period begins only when the Company’s excess availability is 17.5% or less. As of June 30, 2023, the Company had no borrowings. The current forecast of the Company reflects future cash obligations and takes into account the increased operational activity and the Company believes future FCCR calculations will be above the minimum of 1.0 and reflective of those trends.

Previous wording

In addition, on September 25, 2023, the Company entered into an agreement with Wells Fargo Bank, N.A. which designated an additional Letter of Credit in the amount of $1.6 million as part of incremental collateral requirements for the Company’s 2023 insurance renewal. This line of credit falls under the Wells Fargo Revolving Credit Facility aggregate principal amount and matures on September 25, 2024. The interest rate for this Letter of Credit was approximately 1.8% for the three months ended March 31, 2024.

Current wording

In addition, on September 25, 2023, the Company entered into an agreement with Wells Fargo Bank, N.A. which designated an additional Letter of Credit in the amount of $1.6 million as part of incremental collateral requirements for the Company’s 2023 insurance renewal. This line of credit falls under the Wells Fargo Revolving Credit Facility aggregate principal amount and matures on September 25, 2024. The interest rate for this Letter of Credit was approximately 1.8% for the month ended June 30, 2024.

Previous wording

The Wells Fargo Revolving Credit Facility was drawn in part on May 31, 2023, to repay the Revolving Credit Facility, M&E Term Loan Facility, and the Secured Promissory Note. The undrawn portion of the Wells Fargo Revolving Credit Facility is available to fund working capital and other general corporate expenses and for other-permitted uses, including the financing of permitted investments and restricted payments, such as dividends and share repurchases. The Wells Fargo Revolving Credit Facility is subject to a borrowing base that is calculated based upon a percentage of the Company’s eligible accounts receivable less certain reserves. The Company’s eligible accounts receivable serve as collateral for the borrowings under the Wells Fargo Revolving Credit Facility, which is scheduled to mature on May 31, 2028. The Wells Fargo Revolving Credit Facility includes an acceleration clause and cash dominion provisions under certain circumstances that permits the administrative agent to sweep cash daily from certain bank accounts into an account of the administrative agent to repay the Company’s obligations under the Revolving Credit Facility. The borrowings of the Wells Fargo Revolving Credit Facility, therefore, will be classified as Long-term debt, current portion on the Condensed Consolidated Balance Sheet.

Current wording

The Wells Fargo Revolving Credit Facility was drawn in part on May 31, 2023, to repay the Revolving Credit Facility, M&E Term Loan Facility, and the Secured Promissory Note. The undrawn portion of the Wells Fargo Revolving Credit Facility is available to fund working capital and other general corporate expenses and for other-permitted uses, including the financing of permitted investments and restricted payments, such as dividends and share repurchases. The Wells Fargo Revolving Credit Facility is subject to a borrowing base that is calculated based upon a percentage of the Company’s eligible accounts receivable and unbilled revenue less certain reserves. The Company’s eligible accounts receivable serve as collateral for the borrowings under the Wells Fargo Revolving Credit Facility, which is scheduled to mature on May 31, 2028. The Wells Fargo Revolving Credit Facility includes an acceleration clause and cash dominion provisions under certain circumstances that permits the administrative agent to sweep cash daily from certain bank accounts into an account of the administrative agent to repay the Company’s obligations under the Revolving Credit Facility. The borrowings of the Wells Fargo Revolving Credit Facility, therefore, will be classified as Long-term debt, current portion on the Condensed Consolidated Balance Sheet.

Previous wording

Under the Wells Fargo Revolving Credit Facility, the total loan capacity was $58.6 million, which was based on a borrowing base certificate in effect as of March 31, 2024. The Company did not have any borrowings under the Wells Fargo Revolving Credit Facility. The Company does have a $3.2 million of Letters of Credit open under the facility, leaving a residual $55.4 million available for borrowings as of March 31, 2024. Borrowings under the Revolving Credit Facility bear interest at a rate per annum ranging from 1.75% to 2.25% in excess of SOFR and 0.75% to 1.25% in excess of the Base Rate, dependent on the average excess availability. The weighted average interest rate for the loan was approximately 7.2% for the three months ended March 31, 2024.

Current wording

Under the Wells Fargo Revolving Credit Facility, the total loan capacity was $66.7 million, which was based on a borrowing base certificate in effect as of June 30, 2024. On June 17, 2024, the Company entered into the First Amendment to the Wells Fargo Revolving Credit Facility, which allows for a percentage of unbilled revenue to be included in the calculation of the borrowing base. The Company did not have any borrowings under the Wells Fargo Revolving Credit Facility as of June 30, 2024. The Company does have $3.2 million in Letters of Credit open under the facility, leaving a residual $63.5 million available for borrowings as of June 30, 2024. Borrowings under the Revolving Credit Facility bear interest at a rate per annum ranging from 1.75% to 2.25% in excess of SOFR and 0.75% to 1.25% in excess of the Base Rate, dependent on the average excess availability. The weighted average interest rate for the loan was approximately 7.2% for the six months ended June 30, 2024.

Previous wording

On September 27, 2021, the Company entered into a Loan and Security Agreement with Eclipse Business Capital LLC (“EBC”) and Eclipse Business Capital SPV, LLC, as administrative agent, providing the Company with a senior secured credit facility in an aggregate principal amount of $77.5 million (the “EBC Credit Facility”), consisting of (i) a revolving credit facility in an aggregate principal amount of up to $50.0 million (the “Revolving Credit Facility”), (ii) a machinery and equipment term loan facility in an aggregate principal amount of up to $12.5 million (the “M&E Term Loan Facility”) and (iii) a term loan B facility in an aggregate principal amount of up to $15.0 million (the “Term Loan B Facility”).

Current wording

On September 27, 2021, the Company entered into a Loan and Security Agreement with Eclipse Business Capital LLC (“EBC”) and Eclipse Business Capital SPV, LLC, as administrative agent, providing the Company with a senior secured credit facility in an aggregate principal amount of $77.5 million (the “EBC Credit Facility”), consisting of (i) a revolving credit facility in an aggregate principal amount of up to $50.0 million (the “Revolving Credit Facility”), (ii) a machinery and equipment term loan facility in an aggregate principal amount of up to $12.5 million (the “M&E Term Loan Facility”) and (iii) a term loan B facility in an aggregate principal amount of up to $15.0 million (the “Term Loan B Facility”). On August 16, 2022, the Company fully repaid the Eclipse Term Loan B Facility and Eclipse M&E Term Loan Facility, making principal payments totaling $12.4 million and $1.5 million, respectively. On May 31, 2023, the Company extinguished the Eclipse Revolving Credit Facility and Eclipse M&E Term Loan Facility, paying the remaining principal amount of $8.4 million to extinguish the debt, using funds from the Wells Fargo Revolving Credit Facility. The Company recognized a loss on the retirement of debt of $2.4 million in connection with the initiation of the Wells Fargo Revolving Credit Facility.

Previous wording

On July 8, 2021, the Company acquired the assets of PerfX Wireline Services (“PerfX”), a provider of wireline services that operated in Williston, North Dakota and Midland, Texas. In connection with the PerfX acquisition, Bravo Wireline, LLC, a wholly owned subsidiary of Ranger, entered into a security agreement with Chief Investments, LLC, as administrative agent, for the financing of certain assets acquired. Borrowings under the Secured Promissory Note bear interest at a rate of 8.5% per annum and was scheduled to mature in January 2024.

Current wording

On July 8, 2021, the Company acquired the assets of PerfX Wireline Services (“PerfX”), a provider of wireline services that operated in Williston, North Dakota and Midland, Texas. In connection with the PerfX acquisition, Bravo Wireline, LLC, a wholly owned subsidiary of Ranger, entered into a security agreement with Chief Investments, LLC, as administrative agent, for the financing of certain assets acquired. Borrowings under the Secured Promissory On May 31, 2023, the Company made principal payments totaling $5.4 million to extinguish the debt, using funds from the Wells Fargo Revolving Credit Facility.

Previous wording

During the year ended December 31, 2021, the Company entered into various Installment and Security Agreements (collectively, the “Installment Agreements”) in connection with the purchase of certain ancillary equipment, where such assets are being held as collateral. As of March 31, 2024, the aggregate principal balance outstanding under the Installment Agreements was less than $0.1 million and is payable ratably over 36 months from the time of each purchase. For the three months ended March 31, 2024 and three months ended March 31, 2023 the Company paid down the Installment Agreements by $0.1 million and $0.1 million, respectively. The monthly installment payments contain an imputed interest rate that are consistent with the Company’s incremental borrowing rate and is not significant to the Company.

Current wording

During the year ended December 31, 2021, the Company entered into various Installment and Security Agreements (collectively, the “Installment Agreements”) in connection with the purchase of certain ancillary equipment, where such assets are being held as collateral. As of June 30, 2024, the aggregate principal balance outstanding under the Installment Agreements was less than $0.1 million and is payable ratably over 36 months from the time of each purchase. For the six months ended June 30, 2024 and six months ended June 30, 2023 the Company paid down the Installment Agreements by $0.1 million and $0.2 million, respectively. The monthly installment payments contain an imputed interest rate that are consistent with the Company’s incremental borrowing rate and is not significant to the Company.

Previous wording

In 2023, the Board of Directors approved the initiation of the quarterly dividend of $0.05 per share. The Company believes that a share repurchase and dividend framework provides the best overall value creation potential for investors. On May 7, 2024, the Board of Directors declared a quarterly cash dividend of $0.05 per share payable May 31, 2024 to common stockholders of record at the close of business on May 17, 2024. The declaration of any future dividends is subject to the Board of Directors’ discretion and approval.

Current wording

In 2023, the Board of Directors approved the initiation of a quarterly dividend of $0.05 per share. The Company believes that a share repurchase and dividend framework provides the best overall value creation potential for investors. On April 5, 2024, the Company paid dividend distributions totaling $1.1 million to stockholders of record as of the close of business on