Ranger Energy Services, Inc. Q2 FY2025 earnings call

• Second quarter revenue was $140.6 million, with adjusted EBITDA of $20.6 million (14.7% margins). • Exited winter with strong activity pickup continuing into summer. • Launched ECHO rig, industry's first hybrid double electric workover rig, with 2 rigs under construction. • Balance sheet is strong with $48.9 million of cash and $120.1 million of total liquidity as of June. • Deployed liquidity for share repurchases and paid dividends.

High Spec Rigs segment reported $86.3 million in revenue and $17.6 million in adjusted EBITDA, with margins over 20%. Ancillary Services generated $32.2 million in revenue and $6.6 million in adjusted EBITDA. Wireline returned to profitability with $22.1 million in revenue and $1.6 million in adjusted EBITDA.

• Expect continued stability in Q3. • Cautious on Q4 due to potential customer budget exhaustion and macro sentiment. • Focus on being disciplined capital allocators, maximizing free cash flow, and prioritizing shareholder returns. • Looking for accretive M&A and organic growth opportunities.

• Market conditions and rig count declines impacting drilling and completion exposed businesses. • Potential margin pressure from rig transitions between customers. • Unpredictability in Q4 depending on customer budgets and macro sentiment.

Q: About the new ECHO rig contract, is it designed to have similar payback as normal rig?

A: Yes, customers have agreements for increased rates over defined hours to help share incremental cost, resulting in similar return profiles as typical refurb.

Q: On Wireline Services, how did it improve?

A: Improvement due to internal cost control and steadier activity in Q2.

Q: Scaling ECHO rig, how is it driven?

A: Tied to customer demand, with customers showing interest in additional rigs.

Q: Drivers of rig hour increase in High Spec Rigs?

A: Combination of strong relationships with big players, consolidation in high-spec rigs, and customer focus on production efficiencies.

Q: ECHO rig retrofit time frame?

A: First rig took months, but expect to improve retrofit process with increased demand and vendor conversations.

Q: Capital spending plans?

A: Intend to continue share repurchases, consider M&A, and ensure cash on hand for potential ECHO and other opportunities while maintaining balance sheet strength.