Ranger Energy Services Inc

Previous 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.

Current wording

The outlook for the majority of the Company’s service lines remains stable. Despite drilling and completion activity declines during 2023 continuing throughout the first three quarters of 2024, the Company was able to maintain consistent performance through most quarters with declines in some service lines 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 to provide 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 2.11 million barrels per day in 2024 and by 1.78 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 has, thus far, benefited from this consolidation and, 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

The Company believes current geopolitical events will continue to have an impact on our industry. Considering the rapidly evolving events and the interplay of supply and demand within oil and gas commodities sector, numerous unknown factors could materially impact our operations. These events have already, and are likely to continue, influencing commodity prices, causing volatility that could have a material effect on our earnings, cash flows, and financial condition.

Current wording

The Company believes current geopolitical events will continue to have an impact on our industry, potentially including the results of the U.S. election cycle in the fourth quarter. Considering the rapidly evolving events and the interplay of supply and demand within oil and gas commodities sector, numerous unknown factors could materially impact our operations. These events have already, and are likely to continue, influencing commodity prices, causing volatility that could have a material effect on our earnings, cash flows, and financial condition.

Previous wording

The following is an analysis of our operating results. See “—How We Evaluate Our Operations” for definitions of rig hours, stage counts and other analogous information, as well as key operating metrics.

Current wording

The following is an analysis of our operating results. See “—How We Evaluate Our Operations” for definitions of rig hours, stage counts and other analogous information, as well as key operating metrics (in millions).

Previous 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:

Current wording

Revenue. Revenue for the three months ended September 30, 2024 decreased $11.4 million, or 7%, to $153.0 million from $164.4 million for the three months ended September 30, 2023. The change in revenue by segment was as follows:

Previous wording

High Specification Rigs. High Specification Rigs revenue for the three months ended June 30, 2024 increased $5.1 million, or 7%, to $82.7 million from $77.6 million for the three months ended June 30, 2023. The revenue increase is attributable to improved pricing and the average revenue per rig hour increasing 6% to $732 for the three months ended June 30, 2024 from $687 for the three months ended June 30, 2023. Total rig hours were similar between periods with 113,100 hours reported for the three months ended June 30, 2024 compared with 113,200 hours reported for three months ended June 30, 2023.

Current wording

High Specification Rigs. High Specification Rigs revenue for the three months ended September 30, 2024 increased $7.5 million, or 9%, to $86.7 million from $79.2 million for the three months ended September 30, 2023. The revenue increase is attributable to improved pricing and the average revenue per rig hour increasing 6% to $741 for the three months ended September 30, 2024 from $700 for the three months ended September 30, 2023, coupled by a corresponding increase in total rig hours to 116,900 hours for the three months ended September 30, 2024 from 112,400 hours reported for three months ended September 30, 2023.

Previous 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.

Current wording

Wireline Services. Wireline Services revenue for the three months ended September 30, 2024 decreased $22.9 million, or 43%, to $30.3 million from $53.2 million for the three months ended September 30, 2023. The decreased revenue was primarily attributable to a decrease in completion services revenue of $26.0 million where there was a 63% decrease in completed stage counts to 2,500 for the three months ended September 30, 2024 from 6,800 for the three months ended September 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. Wireline production services and pump down revenue increased year over year by a net of $3.2 million reflecting increased operational activity offset by market pricing pressure.

Previous 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:

Current wording

Cost of services (exclusive of depreciation and amortization). Cost of services for the three months ended September 30, 2024 decreased $12.8 million, or 9%, to $122.0 million from $134.8 million for the three months ended September 30, 2023. As a percentage of revenue, cost of services was 80% and 82% for the three months ended September 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 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.

Current wording

High Specification Rigs. High Specification Rigs cost of services for the three months ended September 30, 2024 increased $3.7 million, to $67.2 million from $63.5 million for the three months ended September 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 $2.5 million, $0.9 million and $0.6 million, respectively. As a percentage of High Specification Rigs revenue, cost of services improved from 80% for the three months ended September 30, 2023 to 78% for the three months ended September 30, 2024.

Previous 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.

Current wording

Wireline Services. Wireline Services cost of services for the three months ended September 30, 2024 decreased $18.2 million, or 40%, to $27.6 million from $45.8 million for the three months ended September 30, 2023. The decrease in wireline services cost of sales was primarily attributable to reductions in completion services costs of $22.5 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 86% for the three months ended September 30, 2023 to 91% for the three months ended September 30, 2024 primarily due to declining operating leverage due to lower activity levels.

Previous wording

Processing Solutions and Ancillary Services. Processing Solutions and Ancillary Services cost of services for the three months ended June 30, 2024 decreased $1.8 million, or 7%, to $23.7 million from $25.5 million for the three months ended June 30, 2023. The decrease was primarily attributable to decreased employee costs which accounted for $1.4 million due to improved labor efficiencies within service lines. As a percentage of Processing Solutions and Ancillary Services revenue, cost of services improved from 82% for the three months ended June 30, 2023 to 77% for the three months ended June 30, 2024 due to increased operational efficiencies and cost reductions.

Current wording

Processing Solutions and Ancillary Services. Processing Solutions and Ancillary Services cost of services for the three months ended September 30, 2024 increased $1.7 million, or 7%, to $27.2 million from $25.5 million for the three months ended September 30, 2023. The increase was primarily attributable to increased direct material costs and equipment rentals which accounted for $1.1 million and $0.7 million, respectively. As a percentage of Processing Solutions and Ancillary Services revenue, cost of services improved from 80% for the three months ended September 30, 2023 to 76% for the three months ended September 30, 2024 due to increased operational efficiencies and cost reductions.

Previous wording

Depreciation and Amortization. Depreciation and amortization for the three months ended June 30, 2024 increased $2.3 million, or 26%, to $11.0 million from $8.7 million for the three months ended June 30, 2023. The increase was attributable to increased capital expenditures with shorter useful lives added during the latter half of 2023 into 2024.

Current wording

Depreciation and Amortization. Depreciation and amortization for the three months ended September 30, 2024 increased $0.5 million, or 5%, to $11.1 million from $10.6 million for the three months ended September 30, 2023. The increase was attributable to increased capital expenditures with shorter useful lives added during the latter half of 2023 into 2024.

Previous 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.

Current wording

Interest Expense, net. Interest expense, net remained flat at $0.7 million for the three months ended September 30, 2024 and 2023. The changes in interest expense were attributable to reduced borrowings on the Wells Fargo Revolving Credit Facility, offset by increased borrowing costs on finance leases.

Previous wording

Net Income. Net income for the three months ended June 30, 2024 decreased $1.4 million, or 23%, to $4.7 million from $6.1 million for the three months ended June 30, 2023. The decrease in net income was driven by a combination of reduced operating income from activity declines in the Wireline segment offset by increased pricing in the High Specification Rigs segment and cost reductions in Processing Solutions and Ancillary Services and Other segments. The decrease in operating income was offset by improved interest expense and the non-recurrence of the loss on debt extinguishment from 2023.

Current wording

Net Income. Net income for the three months ended September 30, 2024 decreased $0.7 million, or 7%, to $8.7 million from $9.4 million for the three months ended September 30, 2023. The decrease in net income was driven by reduced operating income from activity declines in the Wireline segment, offset by continued increases in other business lines and reduced tax deductions.

Previous wording

The following is an analysis of our operating results. See “—How We Evaluate Our Operations” for definitions of rig hours, stage counts and other analogous information, as well as key operating metrics.

Current wording

The following is an analysis of our operating results. See “—How We Evaluate Our Operations” for definitions of rig hours, stage counts and other analogous information, as well as key operating metrics (in millions).

Previous wording

Revenue. Revenue for the six months ended June 30, 2024 decreased $45.7 million, or 14%, to $275.0 million from $320.7 million for the six months ended June 30, 2023. The change in revenue by segment was as follows:

Current wording

Revenue. Revenue for the nine months ended September 30, 2024 decreased $57.1 million, or 12%, to $428.0 million from $485.1 million for the nine months ended September 30, 2023. The change in revenue by segment was as follows:

Previous wording

High Specification Rigs. High Specification Rig revenue for the six months ended June 30, 2024 increased $7.3 million, or 5%, to $162.4 million from $155.1 million for the six months ended June 30, 2023. The increase in revenue included an increase in the average revenue per rig hour by 5% to $725 from $688 for the six months ended June 30, 2023, offset by a 1% decrease in total rig hours to 224,100 for the six months ended June 30, 2024 from 225,700 for the six months ended June 30, 2023.

Current wording

High Specification Rigs. High Specification Rig revenue for the nine months ended September 30, 2024 increased $14.8 million, or 6%, to $249.1 million from $234.3 million for the nine months ended September 30, 2023. The increase in revenue included an increase in the average revenue per rig hour by 5% to $730 from $693 for the nine months ended September 30, 2023, coupled by a corresponding 1% increase in total rig hours to 341,000 for the nine months ended September 30, 2024 from 338,100 for the nine months ended September 30, 2023.

Previous wording

Wireline Services. Wireline Services revenue for the six months ended June 30, 2024 decreased $47.1 million, or 45%, to $57.3 million from $104.4 million for the six months ended June 30, 2023. The decrease in wireline services revenue was attributable to reductions in the completions service line totaling $46.5 million illustrated by a 63% decrease in completed stage counts to 5,100 for the six months ended June 30, 2024 from 13,800 for the six months ended June 30, 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. Other Wireline service lines showed slight decreases in the year over year comparable periods due to more significant seasonality declines in 2024 and declining market conditions from the first quarter of 2023.

Current wording

Wireline Services. Wireline Services revenue for the nine months ended September 30, 2024 decreased $70.0 million, or 44%, to $87.6 million from $157.6 million for the nine months ended September 30, 2023. The decrease in wireline services revenue was attributable to reductions in the completions service line totaling $72.6 million illustrated by a 63% decrease in completed stage counts to 7,600 for the nine months ended September 30, 2024 from 20,600 for the nine months ended September 30, 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. Wireline pump down experienced decreases in revenue for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 that were driven by pricing reductions as a consequence of increased competition from frac providers. These declines were offset by wireline production service revenue, which increased year over year by $3.4 million reflecting increased operational activity and an intentional management decision to pivot to production related work.

Previous wording

Processing Solutions and Ancillary Services. Processing Solutions and Ancillary Services revenue for the six months ended June 30, 2024 decreased $5.9 million, or 10%, to $55.3 million from $61.2 million for the six months ended June 30, 2023. The decrease in processing solutions and ancillary services revenue is attributable to decreases in coil tubing and snubbing of $5.4 million and $1.2 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 during the beginning of 2024. The Company has seen a recovery in coil tubing activity beginning in the second quarter of 2024 along with increasing activity in other Ancillary Services lines. Year over year revenue declines were offset by increases in revenue in our logistics, rentals and plugging and abandonment service lines of $0.5 million, $0.2 million and $0.1 million, respectively.

Current wording

Processing Solutions and Ancillary Services. Processing Solutions and Ancillary Services revenue for the nine months ended September 30, 2024 decreased $1.9 million, or 2%, to $91.3 million from $93.2 million for the nine months ended September 30, 2023. The decrease in processing solutions and ancillary services revenue is attributable to decreases in coil tubing and snubbing of $5.0 million and $1.2 million, respectively. The Company has seen a recovery in both coil tubing and snubbing activity in the third quarter. For coil tubing, third quarter 2024 revenues of $11.2 million represented a high mark for every quarterly reporting period in the last two fiscal years. Increasing activity in other Ancillary Services lines is reflected in increases in revenue in our rentals, plugging and abandonment, and logistics service lines of $1.9 million, $1.5 million and $1.0 million, respectively. Our Torrent gas processing business has continued to grow resulting in revenues of $5.1 million in the nine months ended September 30, 2024, compared to $3.9 million for the nine months ended September 30, 2023, an increase of $1.2 million.

Previous wording

Cost of services (exclusive of depreciation and amortization). Cost of services for the six months ended June 30, 2024 decreased $33.2 million, or 12%, to $234.0 million from $267.2 million for the six months ended June 30, 2023. As a percentage of revenue, cost of services was 85% and 83% for the six months ended June 30, 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 nine months ended September 30, 2024 decreased $46.0 million, or 11%, to $356.0 million from $402.0 million for the nine months ended September 30, 2023. As a percentage of revenue, cost of services was 83% for both nine months ended September 30, 2024 and 2023, respectively. The change in cost of services by segment was as follows:

Previous wording

High Specification Rigs. High Specification Rig cost of services for the six months ended June 30, 2024 increased $9.5 million, or 8%, to $131.6 million from $122.1 million for the six months ended June 30, 2023. The increase was primarily attributable to an increase in variable expenses, most significant of which is employee-related labor costs, travel, and repair and maintenance accounting for of $6.6 million, $1.3 million and $1.3 million, respectively. As a percentage of High Specification Rigs Services revenue, cost of services increased from 78% for the six months ended June 30, 2023 to 81% for the six months ended June 30, 2024 driven largely by standby labor costs incurred during the first quarter of 2024.

Current wording

High Specification Rigs. High Specification Rig cost of services for the nine months ended September 30, 2024 increased $13.2 million, or 7%, to $198.8 million from $185.6 million for the nine months ended September 30, 2023. The increase was primarily attributable to an increase in variable expenses, most significant of which is employee-related labor costs, repair and maintenance, and travel accounting for of $9.1 million, $2.2 million and $1.9 million, respectively. As a percentage of High Specification Rigs Services revenue, cost of services increased from 79% for the nine months ended September 30, 2023 to 80% for the nine months ended September 30, 2024 driven largely by standby labor costs incurred during the first quarter of 2024.

Previous wording

Wireline Services. Wireline Services cost of services for the six months ended June 30, 2024 decreased $37.7 million, or 40%, to $56.8 million from $94.5 million for the six months ended June 30, 2023. The decrease is primarily attributable to a decrease in costs from the completion services lines by approximately $41.9 million as the Company reorganized this service line to accommodate lower operation activity and focus on more profitable service lines. As a percentage of Wireline Services revenue, cost of services increased from 91% for the six months ended June 30, 2023 to 99% for the six months ended June 30, 2024 primarily due to declining operating leverage due to lower activity levels. The decrease in completion service line costs were offset by an increase in costs from the production and pump down service lines to drive expanding activity levels.

Current wording

Wireline Services. Wireline Services cost of services for the nine months ended September 30, 2024 decreased $55.9 million, or 40%, to $84.4 million from $140.3 million for the nine months ended September 30, 2023. The decrease is primarily attributable to a decrease in costs from the completion services lines by approximately $64.4 million as the Company reorganized this service line to accommodate lower operation activity and focus on more profitable service lines. As a percentage of Wireline Services revenue, cost of services increased from 89% for the nine months ended September 30, 2023 to 96% for the nine months ended September 30, 2024 primarily due to declining operating leverage due to lower activity levels. The decrease in completion service line costs were offset by an increase in costs from the production and pump down service lines to drive expanding activity levels.

Previous wording

Processing Solutions and Ancillary Services. Processing Solutions and Ancillary Services cost of services for the six months ended June 30, 2024 decreased $5.0 million, or 10%, to $45.6 million from $50.6 million for the six months ended June 30, 2023. The increase was primarily attributable to decreased employee labor, fuel and travel costs associated which amounted to $2.4 million, $1.0 million and $0.9 million, respectively.

Current wording

Processing Solutions and Ancillary Services. Processing Solutions and Ancillary Services cost of services for the nine months ended September 30, 2024 decreased $3.3 million, or 4%, to $72.8 million from $76.1 million for the nine months ended September 30, 2023. The decrease was primarily attributable to decreased employee labor, travel, repair and maintenance, and fuel costs associated which amounted to $2.6 million, $1.1 million, $0.9 million and $0.7 million in cost reductions, respectively. As a percentage of Processing Solutions and Ancillary Services revenue, cost of services improved from 82% for the nine months ended September 30, 2023 to 80% for the nine months ended September 30, 2024 due to increased operational efficiencies and cost reductions.

Previous wording

General & Administrative. General and administrative expenses for the six months ended June 30, 2024 decreased $2.1 million, or 13%, to $13.6 million from $15.7 million. The decrease in general and administrative expenses is primarily due to lower compensation costs relative to the prior year, coupled with legal fees and transactional costs incurred during the six months ended June 30, 2023.

Current wording

General & Administrative. General and administrative expenses for the nine months ended September 30, 2024 decreased $2.0 million, or 9%, to $20.7 million from $22.7 million. The decrease in general and administrative expenses is primarily due to lower personnel costs relative to the prior year, coupled with legal fees and transactional costs incurred during the nine months ended September 30, 2023.

Previous 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.

Current wording

Depreciation and Amortization. Depreciation and amortization for the nine months ended September 30, 2024 increased $4.0 million, or 14%, to $33.3 million from $29.3 million for the nine months ended September 30, 2023. The increase was attributable to capital expenditures added during the latter half of 2023 into 2024.

Previous wording

Interest Expense, net. Interest expense, net for the six months ended June 30, 2024 decreased $0.7 million, or 33%, to $1.4 million from $2.1 million for the six months ended June 30, 2023. The decrease to net interest expense was attributable to the decreased levels of borrowings year over year in conjunction with refinancings completed during the second quarter of 2023 resulting in lower borrowing costs.

Current wording

Interest Expense, net. Interest expense, net for the nine months ended September 30, 2024 decreased $0.7 million, or 25%, to $2.1 million from $2.8 million for the nine months ended September 30, 2023. The decrease to net interest expense was attributable to the decreased levels of borrowings year over year in conjunction with refinancings completed during the second quarter of 2023 resulting in lower borrowing costs.

Previous 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.

Current wording

Income Tax Expense. Income tax expense for the nine months ended September 30, 2024 decreased $0.4 million, or 7%, to $5.0 million from $5.4 million for the nine months ended September 30, 2023. The decrease in tax expense resulted from a decrease in profit before tax when compared to the prior period.

Previous 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.

Current wording

Net Income. Net income for the nine months ended September 30, 2024 decreased $9.1 million, or 42%, to $12.6 million from $21.7 million for the nine months ended September 30, 2023. The decrease in net income was primarily driven by reduced activity in Wireline Services segment.

Previous 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:

Current wording

Adjusted EBITDA for the three months ended September 30, 2024 increased $1.1 million to $25.1 million from $24.0 million for the three months ended September 30, 2023. The change by segment was as follows:

Previous 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.

Current wording

High Specification Rigs. High Specification Rigs Adjusted EBITDA for the three months ended September 30, 2024 increased $3.5 million to $19.2 million from $15.7 million for the three months ended September 30, 2023, due to increased revenue of $7.5 million, partially offset by a corresponding increase in cost of services of $3.7 million.

Previous 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.

Current wording

Wireline Services. Wireline Services Adjusted EBITDA for the three months ended September 30, 2024 decreased $4.7 million to $2.7 million from $7.4 million for the three months ended September 30, 2023, due to decreased operating activity resulting in revenue declines of $22.9 million, partially offset by a corresponding decrease in cost of services of $18.2 million.

Previous 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.

Current wording

Other. Other Adjusted EBITDA for the three months ended September 30, 2024 and 2023 held consistent at a loss of $5.6 million. 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

Adjusted EBITDA for the six months ended June 30, 2024 decreased $10.1 million to $31.9 million from $42.0 million for the six months ended June 30, 2023. The change by segment was as follows:

Current wording

Adjusted EBITDA for the nine months ended September 30, 2024 decreased $9.0 million to $57.0 million from $66.0 million for the nine months ended September 30, 2023. The change by segment was as follows:

Previous wording

High Specification Rigs. High Specification Rigs Adjusted EBITDA for the six months ended June 30, 2024 decreased $0.7 million to $32.3 million from $33.0 million for the six months ended June 30, 2023, primarily due reduced operating levels during the first quarter of 2024 and elevated labor costs due to standby time.

Current wording

High Specification Rigs. High Specification Rigs Adjusted EBITDA for the nine months ended September 30, 2024 increased $2.8 million to $51.5 million from $48.7 million for the nine months ended September 30, 2023, primarily due to increased operating levels during the third quarter of 2024.

Previous wording

Wireline Services. Wireline Services Adjusted EBITDA for the six months ended June 30, 2024 decreased $9.3 million to $0.6 million from $9.9 million for the six months ended June 30, 2023, primarily due to significant decreases in operating activity within the completions service line.

Current wording

Wireline Services. Wireline Services Adjusted EBITDA for the nine months ended September 30, 2024 decreased $14.0 million to $3.3 million from $17.3 million for the nine months ended September 30, 2023, primarily due to significant decreases in operating activity within the completions service line.

Previous wording

Processing Solutions and Ancillary Services. Processing Solutions and Ancillary Services Adjusted EBITDA for the six months ended June 30, 2024 decreased $0.8 million to $9.8 million from $10.6 million for the six months ended June 30, 2023, primarily due to decreased coil tubing revenue, partially offset by a decrease in cost of services across service lines.

Current wording

Processing Solutions and Ancillary Services. Processing Solutions and Ancillary Services Adjusted EBITDA for the nine months ended September 30, 2024 increased $1.5 million to $18.6 million from $17.1 million for the nine months ended September 30, 2023, primarily due to a decrease in cost of services across service lines, partially offset by to decreased coil tubing revenue.

Previous wording

Other. Other Adjusted EBITDA for the six months ended June 30, 2024 improved $0.7 million to a loss of $10.8 million from a loss of $11.5 million for the six 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.

Current wording

Other. Other Adjusted EBITDA for the nine months ended September 30, 2024 improved $0.7 million to a loss of $16.4 million from a loss of $17.1 million for the nine months ended September 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 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.”

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 September 30, 2024, we had total liquidity of $86.1 million, consisting of $14.8 million of cash on hand and availability under our Wells Fargo Revolving Credit Facility of $71.3 million. Under the Wells Fargo Revolving Credit Facility, the total loan capacity was $75.0 million, net of $3.7 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 $61.7 million as of September 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 $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.

Current wording

Net cash from operating activities decreased $1.3 million to $51.8 million for nine months ended September 30, 2024 compared to $53.1 million for the nine months ended September 30, 2023. The change in cash flows from operating activities is primarily attributable to a decrease in operating income for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023. Cash created from working capital decreased $5.0 million to $4.4 million utilized for the nine months ended September 30, 2024, compared to $9.4 million utilized for the nine months ended September 30, 2023 due to improvements in collections activities in the most recent quarters.

Previous 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.

Current wording

Net cash used in investing activities increased $4.2 million to $27.2 million for nine months ended September 30, 2024 compared to $23.0 million for the nine months ended September 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 nine months ended September 30, 2024 and less proceeds from asset disposals relative to those that occurred during the nine months ended September 30, 2023.

Previous 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).

Current wording

Net cash used in financing activities increased $0.1 million to $25.5 million for nine months ended September 30, 2024 compared to $25.6 million for the nine months ended September 30, 2023. Cash used in financing activities for the nine months ended September 30, 2024 primarily was allocated to the repurchase of Class A Common Stock (see Item 1. Financial Information— Note 10 — Equity).