UNITED
STATES
 SECURITIES
AND EXCHANGE COMMISSION
 WASHINGTON,
D.C.  20549
 
 
 FORM
10-Q
 
 
 Quarterly
report pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
 
 
 For
the quarterly period ended March 31, 2009
 
 Commission
File No. 1-8726
 
 RPC,
INC.
 (Exact
name of registrant as specified in its charter)
 
 Delaware
                58-1550825(State
      or other jurisdiction of incorporation or organization)
                (I.R.S.
      Employer Identification
Number)
 
 2801
Buford Highway, Suite 520, Atlanta, Georgia  30329
 (Address
of principal executive offices)    (zip code)
 
 Registrant’s
telephone number, including area code -- (404) 321-2140
 
 Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the Registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes x  No o
 
 Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting
company.  See definitions of “large accelerated filer,” “accelerated
filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange
Act.      (Check one):
 
 Large
      accelerated filer o
                Accelerated
      filer x
                Non-accelerated
      filer o
                Smaller
      reporting company o
 
 Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).  Yes o  Nox
 
 As of
April 24, 2009, RPC, Inc. had 98,426,892 shares of common stock
outstanding.
 
 
 
 RPC,
INC. AND SUBSIDIARIES
 
 TABLE OF
CONTENTS
 
 Part
      I. Financial Information
                      Page
                        No.Item
      1.
                      Financial
      Statements (Unaudited)Consolidated
      Balance Sheets – As of March 31, 2009 and December 31,
2008
                      3Consolidated
      Statements of Operations – For the three months ended March 31, 2009 and
      2008
                      4Consolidated
      Statement of Stockholders’ Equity – For the three months ended March 31,
      2009
                      5Consolidated
      Statements of Cash Flows – For the three months ended March 31, 2009 and
      2008
                      6Notes
      to Consolidated Financial Statements
                      7 –
      19Item
      2.
                      Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations
                      20 –
      30Item
      3.
                      Quantitative
      and Qualitative Disclosures about Market Risk
                      30Item
      4.
                      Controls
      and Procedures
                      31Part
      II.  Other InformationItem
      1.
                      Legal
      Proceedings
                      32Item
      1A.
                      Risk
      Factors
                      32Item
      2.
                      Unregistered
      Sales of Equity Securities and Use of Proceeds
                      32Item
      3.
                      Defaults
      upon Senior Securities
                      33Item
      4.
                      Submission
      of Matters to a Vote of Security Holders
                      33Item
      5.
                      Other
      Information
                      33Item
      6.
                      Exhibits
                      34Signatures
                      
                      35
  2
  RPC,
      INC. AND SUBSIDIARIESPART
      I. FINANCIAL INFORMATIONITEM
      1. FINANCIAL STATEMENTSCONSOLIDATED
      BALANCE SHEETSAS
      OF MARCH 31, 2009 AND DECEMBER 31, 2008(In
      thousands)(Unaudited)March
      31,
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      December
      31,2009
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      2008ASSETS
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      (Note
      1)Cash
      and cash equivalents
                                                                                                                                                                                      
                                                                                                                                                                                      $
                                                                                                                                                                                      2,312
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      $
                                                                                                                                                                                      3,037Accounts
      receivable, net
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      153,307
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      210,375Inventories
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      56,611
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      49,779Deferred
      income taxes
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      6,004
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      6,187Income
      taxes receivable
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      12,279
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      15,604Prepaid
      expenses and other current assets
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      4,294
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      7,841Total
      current assets
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      234,807
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      292,823Property,
      plant and equipment, net
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      461,480
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      470,115Goodwill
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      24,093
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      24,093Other
      assets
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      7,217
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      6,430Total
      assets
                                                                                                                                                                                      
                                                                                                                                                                                      $
                                                                                                                                                                                      727,597
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      $
                                                                                                                                                                                      793,461LIABILITIES
      AND STOCKHOLDERS' EQUITYAccounts
      payable
                                                                                                                                                                                      
                                                                                                                                                                                      $
                                                                                                                                                                                      50,633
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      $
                                                                                                                                                                                      61,217Accrued
      payroll and related expenses
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      12,888
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      20,398Accrued
      insurance expenses
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      4,764
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      4,640Accrued
      state, local and other taxes
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      3,196
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      2,395Income
      taxes payable
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      1,007
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      3,359Other
      accrued expenses
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      315
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      320Total
      current liabilities
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      72,803
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      92,329Long
      -term accrued insurance expenses
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      8,377
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      8,398Notes
      payable to banks
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      132,500
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      174,450Long-term
      pension liabilities
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      12,034
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      11,177Other
      long-term liabilities
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      2,065
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      3,628Deferred
      income taxes
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      53,706
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      54,395Total
      liabilities
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      281,485
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      344,377Common
      stock
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      9,843
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      9,770Capital
      in excess of par value
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      3,322
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      3,990Retained
      earnings
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      443,018
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      445,356Accumulated
      other comprehensive loss
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      (10,071
                                                                                                                                                                                      )
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      (10,032
                                                                                                                                                                                      )Total
      stockholders' equity
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      446,112
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      449,084Total
      liabilities and stockholders' equity
                                                                                                                                                                                      
                                                                                                                                                                                      $
                                                                                                                                                                                      727,597
                                                                                                                                                                                      
                                                                                                                                                                                      
                                                                                                                                                                                      $
                                                                                                                                                                                      793,461The
      accompanying notes are an integral part of these consolidated financial
      statements.
 3
  RPC,
      INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF OPERATIONSFOR
      THE THREE MONTHS ENDED MARCH 31, 2009 and 2008(In
      thousands except per share data)(Unaudited)Three
      months ended March 31,2009
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    2008Revenues
                                                                                                                                    
                                                                                                                                    $
                                                                                                                                    176,271
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    $
                                                                                                                                    197,227Cost
      of revenues
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    109,970
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    117,670Selling,
      general and administrative expenses
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    27,606
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    28,317Depreciation
      and amortization
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    32,020
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    27,326Gain
      on disposition of assets, net
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    (1,722
                                                                                                                                    )
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    (1,527
                                                                                                                                    )Operating
      profit
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    8,397
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    25,441Interest
      expense
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    (594
                                                                                                                                    )
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    (1,471
                                                                                                                                    )Interest
      income
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    33
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    22Other
      income (expense), net
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    143
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    (7
                                                                                                                                    )Income
      before income taxes
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    7,979
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    23,985Income
      tax provision
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    3,513
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    9,228Net
      income
                                                                                                                                    
                                                                                                                                    $
                                                                                                                                    4,466
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    $
                                                                                                                                    14,757Earnings
      per shareBasic
                                                                                                                                    
                                                                                                                                    $
                                                                                                                                    0.05
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    $
                                                                                                                                    0.15Diluted
                                                                                                                                    
                                                                                                                                    $
                                                                                                                                    0.05
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    $
                                                                                                                                    0.15Dividends
      per share
                                                                                                                                    
                                                                                                                                    $
                                                                                                                                    0.07
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    $
                                                                                                                                    0.06Average
      shares outstandingBasic
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    96,178
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    96,586Diluted
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    96,729
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    
                                                                                                                                    98,091The
      accompanying notes are an integral part of these consolidated financial
      statements.
 4
  RPC,
      INC. AND SUBSIDIARIESCONSOLIDATED STATEMENT
      OF STOCKHOLDERS' EQUITYFOR
      THE THREE MONTHS ENDED MARCH 31, 2009(In
      thousands)(Unaudited)Comprehensive
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          Common
      Stock
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          Capital
      in
                                                                                                                                                                                                                                                                                                                                                                                                                            Excess
      of
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          Retained
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          Accumulated
      Other ComprehensiveIncome
      (Loss)
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          Shares
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          Amount
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          Par
Value
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          Earnings
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          Loss
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          TotalBalance,
      December 31, 2008
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          97,705
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          $
                                                                                                                                                                                                                                                                                                                                                                                                                          9,770
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          $
                                                                                                                                                                                                                                                                                                                                                                                                                          3,990
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          $
                                                                                                                                                                                                                                                                                                                                                                                                                          445,356
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          $
                                                                                                                                                                                                                                                                                                                                                                                                                          (10,032
                                                                                                                                                                                                                                                                                                                                                                                                                          )
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          $
                                                                                                                                                                                                                                                                                                                                                                                                                          449,084Stock
      issued for stock incentiveplans,
      net
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          925
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          93
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (230
                                                                                                                                                                                                                                                                                                                                                                                                                          )
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (137
                                                                                                                                                                                                                                                                                                                                                                                                                          )Stock
      purchased and retired
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (202
                                                                                                                                                                                                                                                                                                                                                                                                                          )
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (20
                                                                                                                                                                                                                                                                                                                                                                                                                          )
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (1,640
                                                                                                                                                                                                                                                                                                                                                                                                                          )
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (1,660
                                                                                                                                                                                                                                                                                                                                                                                                                          )Net
      income
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          $
                                                                                                                                                                                                                                                                                                                                                                                                                          4,466
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          4,466
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          4,466Pension
      adjustment, net of taxes
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          309
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          309
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          309Loss
      on cash flow hedge,net
      of taxes
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (114
                                                                                                                                                                                                                                                                                                                                                                                                                          )
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (114
                                                                                                                                                                                                                                                                                                                                                                                                                          )
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (114
                                                                                                                                                                                                                                                                                                                                                                                                                          )Foreign
      currency translation,net
      of taxes
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (164
                                                                                                                                                                                                                                                                                                                                                                                                                          )
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (164
                                                                                                                                                                                                                                                                                                                                                                                                                          )
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (164
                                                                                                                                                                                                                                                                                                                                                                                                                          )Unrealized
      loss on securities,net
      of taxes
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (70
                                                                                                                                                                                                                                                                                                                                                                                                                          )
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (70
                                                                                                                                                                                                                                                                                                                                                                                                                          )
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (70
                                                                                                                                                                                                                                                                                                                                                                                                                          )Comprehensive
      income
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          $
                                                                                                                                                                                                                                                                                                                                                                                                                          4,427Dividends
      declared
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (6,804
                                                                                                                                                                                                                                                                                                                                                                                                                          )
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          (6,804
                                                                                                                                                                                                                                                                                                                                                                                                                          )Stock-based
      compensation
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          1,015
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          1,015Excess
      tax benefits for share-based
      payments
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          187
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          —
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          187Balance,
      March 31, 2009
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          98,428
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          $
                                                                                                                                                                                                                                                                                                                                                                                                                          9,843
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          $
                                                                                                                                                                                                                                                                                                                                                                                                                          3,322
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          $
                                                                                                                                                                                                                                                                                                                                                                                                                          443,018
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          $
                                                                                                                                                                                                                                                                                                                                                                                                                          (10,071
                                                                                                                                                                                                                                                                                                                                                                                                                          )
                                                                                                                                                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                                                                                                                          $
                                                                                                                                                                                                                                                                                                                                                                                                                          446,112The
      accompanying notes are an integral part of this consolidated financial
      statement.
 5
  RPC,
      INC. AND SUBSIDIARIESCONSOLIDATED
      STATEMENTS OF CASH FLOWSFOR
      THE THREE MONTHS ENDED MARCH 31, 2009 and 2008(In
      thousands)(Unaudited)Three
      months ended March 31,2009
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                2008OPERATING
      ACTIVITIESNet
      income
                                                                                                                                                                                                                
                                                                                                                                                                                                                $
                                                                                                                                                                                                                4,466
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                $
                                                                                                                                                                                                                14,757Adjustments
      to reconcile net income to net cash provided by operating
      activities:Depreciation,
      amortization and other non-cash charges
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                31,999
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                27,327Stock-based
      compensation expense
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                1,015
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                889Gain
      on disposition of assets, net
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (1,722
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (1,527
                                                                                                                                                                                                                )Deferred
      income tax (benefit) provision
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (1,173
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                586Excess
      tax benefits for share-based payments
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (187
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (421
                                                                                                                                                                                                                )Changes
      in current assets and liabilities:Accounts
      receivable
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                57,029
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                2,179Income
      taxes receivable
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                3,512
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                5,095Inventories
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (6,871
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (4,851
                                                                                                                                                                                                                )Prepaid
      expenses and other current assets
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                3,431
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                789Accounts
      payable
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (15,334
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                4,847Income
      taxes payable
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (2,352
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                490Accrued
      payroll and related expenses
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (7,510
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (3,512
                                                                                                                                                                                                                )Accrued
      insurance expenses
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                124
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                156Accrued
      state, local and other taxes
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                801
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                562Other
      accrued expenses
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (3
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (27
                                                                                                                                                                                                                )Changes
      in working capital
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                32,827
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                5,728Changes
      in other assets and liabilities:Accrued
      pension
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                1,344
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                543Accrued
      insurance expenses
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (21
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                755Other
      non-current assets
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (784
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (631
                                                                                                                                                                                                                )Other
      non-current liabilities
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (1,743
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (1,279
                                                                                                                                                                                                                )Net
      cash provided by operating activities
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                66,021
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                46,727INVESTING
      ACTIVITIESCapital
      expenditures
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (19,475
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (46,335
                                                                                                                                                                                                                )Proceeds
      from sale of assets
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                2,571
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                2,466Net
      cash used for investing activities
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (16,904
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (43,869
                                                                                                                                                                                                                )FINANCING
      ACTIVITIESPayment
      of dividends
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (6,804
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (5,794
                                                                                                                                                                                                                )Borrowings
      from notes payable to banks
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                68,300
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                99,000Repayments
      of notes payable to banks
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (110,250
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (86,350
                                                                                                                                                                                                                )Excess
      tax benefits for share-based payments
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                187
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                421Cash
      paid for common stock purchased and retired
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (1,349
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (5,193
                                                                                                                                                                                                                )Proceeds
      received upon exercise of stock options
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                74
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                210Net
      cash (used for) provided by financing activities
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (49,842
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                2,294Net
      (decrease) increase in cash and cash equivalents
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                (725
                                                                                                                                                                                                                )
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                5,152Cash
      and cash equivalents at beginning of period
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                3,037
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                6,338Cash
      and cash equivalents at end of period
                                                                                                                                                                                                                
                                                                                                                                                                                                                $
                                                                                                                                                                                                                2,312
                                                                                                                                                                                                                
                                                                                                                                                                                                                
                                                                                                                                                                                                                $
                                                                                                                                                                                                                11,490The
      accompanying notes are an integral part of these consolidated financial
      statements.
 6
  RPC,
INC. AND SUBSIDIARIES
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 1.
                      GENERAL
 
 The
accompanying unaudited consolidated financial statements include the accounts of
RPC, Inc. and its wholly-owned subsidiaries (“RPC” or the “Company”) and have
been prepared in accordance with accounting principles generally accepted in the
United States of America for interim financial information and with the
instructions to Form 10-Q and Article 10 of Regulation
S-X.  Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements.  In the opinion of management, all adjustments
(all of which consisted of normal recurring accruals) considered necessary for a
fair presentation have been included.  Operating results for the three
month period ended March 31, 2009 are not necessarily indicative of the results
that may be expected for the year ending December 31, 2009.
 
 The
balance sheet at December 31, 2008 has been derived from the audited financial
statements at that date but does not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements.
 
 For
further information, refer to the consolidated financial statements and
footnotes thereto included in the Company’s annual report on Form 10-K for the
year ended December 31, 2008.
 
 A group
that includes the Company’s Chairman of the Board, R. Randall Rollins and his
brother Gary W. Rollins, who is also a director of the Company, and certain
companies under their control, controls in excess of fifty percent of the
Company’s voting power.
 
 2.
                REVENUES
  RPC’s
revenues are generated principally from providing services and the related
equipment.  Revenues are recognized when the services are rendered and
collectibility is reasonably assured.  Revenues from services and
equipment are based on fixed or determinable priced purchase orders or contracts
with the customer and do not include the right of return.  Rates for
services and equipment are priced on a per day, per unit of measure, per man
hour or similar basis.  Sales tax charged to customers is presented on
a net basis within the consolidated statement of operations and excluded from
revenues.
 
 3.
                EARNINGS
      PER SHARE
 
 Statement
of Financial Accounting Standard (“SFAS”) No. 128, “Earnings Per Share,”
requires a basic earnings per share and diluted earnings per share presentation.
The two calculations differ as a result of the dilutive effect of stock options
and time lapse restricted shares and performance restricted shares included in
diluted earnings per share, but excluded from basic earnings per share. Basic
and diluted earnings per share are computed by dividing net income by the
weighted average number of shares outstanding during the respective
periods.  A reconciliation of weighted average shares outstanding is
as follows:
  7
  RPC,
INC. AND SUBSIDIARIES
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
  Three
      months ended March 31,(In
      thousands except per share data )
                                                                          
                                                                          2009
                                                                          
                                                                          
                                                                          2008Net
      income available for stockholders (numerator for basic and
      diluted  earnings per share):
                                                                          
                                                                          $
                                                                          4,466
                                                                          
                                                                          
                                                                          $
                                                                          14,757Shares
      (denominator):Weighted
      average shares outstanding (denominator for basic earnings per
      share)
                                                                          
                                                                          
                                                                          96,178
                                                                          
                                                                          
                                                                          
                                                                          96,586Effect
      of dilutive securities:Employee
      stock options and restricted stock
                                                                          
                                                                          
                                                                          551
                                                                          
                                                                          
                                                                          
                                                                          1,505Adjusted
      weighted average shares (denominator for diluted earnings per
      share)
                                                                          
                                                                          
                                                                          96,729
                                                                          
                                                                          
                                                                          
                                                                          98,091Earnings
      per share:Basic
                                                                          
                                                                          $
                                                                          0.05
                                                                          
                                                                          
                                                                          $
                                                                          0.15Diluted
                                                                          
                                                                          $
                                                                          0.05
                                                                          
                                                                          
                                                                          $
                                                                          0.15
 
 In June
2008, the FASB issued FASB Staff Position (FSP) EITF 03-6-1, “Determining
Whether Instruments Granted in Share-Based Payment Transactions Are
Participating Securities,” to clarify that all outstanding unvested share-based
payment awards that contain non-forfeitable rights to dividends or dividend
equivalents, whether paid or unpaid, are participating securities. An entity
must include participating securities in its calculation of basic and diluted
earnings per share (EPS) pursuant to the two-class method, as described in FASB
Statement 128, Earnings per Share. The Company has periodically issued
share-based payment awards that contain non-forfeitable rights to
dividends.  The Company evaluated the impact of FSP EITF 03-6-1
and determined that the impact was not material and determined the basic and
diluted earnings per share amounts as reported are equivalent to the basic and
diluted earnings per share amounts calculated under FSP EITF
03-6-1.
 
 4.
                RECENT
      ACCOUNTING PRONOUNCEMENTS
 
 Recently
Adopted Accounting Pronouncements:
  Financial
Accounting Standards Board Staff Positions and Interpretations
 
 In June
2008, the FASB issued FSP EITF 03-6-1, “Determining Whether Instruments Granted
in Share-Based Payment Transactions Are Participating
Securities.”  The Company adopted FSP EITF 03-6-1 effective January 1,
2009 and the adoption of this accounting guidance did not have a material effect
on its consolidated financial statements or EPS.  See Note 3 titled
Earnings Per Share for further details.
  8
  RPC,
INC. AND SUBSIDIARIES
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
  In
April 2008, the FASB issued FSP FAS No. 142-3, which amends the
factors that must be considered in developing renewal or extension assumptions
used to determine the useful life over which to amortize the cost of a
recognized intangible asset under SFAS No. 142, “Goodwill and Other Intangible
Assets.” The FSP requires an entity that is estimating the useful life of
a recognized intangible asset to consider its historical experience in renewing
or extending similar arrangements or, in the absence of historical experience,
must consider assumptions that market participants would use about renewal or
extension that are both consistent with the asset’s highest and best use and
adjusted for entity-specific factors under SFAS No. 142.  The
Company adopted the provisions of this FSP on January 1, 2009 and plans to apply
the guidance for determining the useful life of a recognized intangible asset
acquired hereafter.
 
 Recently
Issued Accounting Pronouncements Not Yet Adopted:
  Financial
Accounting Standards Board Staff Positions and Interpretations
 
 In
December 2008, the FASB issued FASB Staff Position (FSP) FAS 132R-1, “Employers’
Disclosures about Postretirement Benefit Plan Assets.” The FASB issued the FSP,
which amends FASB Statement 132R, Employers’ Disclosures about
Pensions and Other Postretirement Benefits, in order to provide adequate
transparency about the types of assets and associated risks in employers’
postretirement plans.  Disclosures are designed to provide an
understanding of how investment decisions are made: the major categories of plan
assets; the inputs and valuation techniques used to measure the fair value of
plan assets; the effect of fair value measurements using significant
unobservable inputs (Level 3 measurements in FASB Statement 157, Fair Value
Measurements) on changes in plan assets for the period; and significant
concentrations of risk within plan assets.  The disclosures about plan
assets required by this FSP are required to be provided for fiscal years ending
after December 15, 2009, with the provisions of this FSP not required for
earlier periods that are presented for comparative purposes, upon initial
application. Earlier application of the provisions of this FSP is permitted. The
Company is currently in the process of determining the additional disclosures
required upon the adoption of this FSP.
 
 In April
2009, the FASB issued FSP SFAS 157-4, “Determining Fair Value When the
Volume and Level of Activity for the Asset or Liability Have Significantly
Decreased and Identifying Transactions That Are Not
Orderly.”  FSP SFAS 157-4 affirms that the objective of fair
value when the market for an asset is not active is the price that would be
received to sell the asset in an orderly transaction, and clarifies and includes
additional factors for determining whether there has been a significant decrease
in market activity for an asset when the market for that asset is not active.
FSP SFAS 157-4 requires an entity to base its conclusion about whether
a transaction was not orderly on the weight of the evidence.
FSP SFAS 157-4 also amended SFAS 157, “Fair Value Measurements,”
to expand certain disclosure requirements.  This FSP shall be
effective for interim and annual reporting periods ending after June 15, 2009,
and shall be applied prospectively. Adoption of this
FSP SFAS 157-4 is not expected to have a material impact on the
Company’s consolidated financial statements.
  9
 RPC,
INC. AND SUBSIDIARIES
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
  In April
2009, the FASB issued FSP SFAS 115-2 and SFAS 124-2, “Recognition and
Presentation of Other-Than-Temporary Impairments.” FSP SFAS 115-2 and
SFAS 124-2 (i) changes existing guidance for determining whether an
impairment is other than temporary to debt securities and (ii) replaces the
existing requirement that the entity’s management assert it has both the intent
and ability to hold an impaired security until recovery with a requirement that
management assert: (a) it does not have the intent to sell the security;
and (b) it is more likely than not it will not have to sell the security
before recovery of its cost basis. Under FSP SFAS 115-2 and
SFAS 124-2, declines in the fair value of held-to-maturity and
available-for-sale securities below their cost that are deemed to be other than
temporary are reflected in earnings as realized losses to the extent the
impairment is related to credit losses. The amount of the impairment related to
other factors is recognized in other comprehensive income. This FSP shall be
effective for interim and annual reporting periods ending after June 15,
2009.  Adoption of this FSP is not expected to have a material impact
on the Company’s consolidated financial statements.
  In April
2009, the FASB issued FSP SFAS 107-1 and APB 28-1, “Interim Disclosures
about Fair Value of Financial Instruments.” FSP SFAS 107-1 and APB 28-1
amends SFAS 107, “Disclosures about Fair Value of Financial Instruments,”
to require an entity to provide disclosures about fair value of financial
instruments in interim financial information and amends Accounting Principles
Board (APB) Opinion No. 28, “Interim Financial Reporting,” to
require those disclosures in summarized financial information at interim
reporting periods. Under FSP SFAS 107-1 and APB 28-1, a publicly
traded company shall include disclosures about the fair value of its financial
instruments whenever it issues summarized financial information for interim
reporting periods. In addition, entities must disclose, in the body or in the
accompanying notes of its summarized financial information for interim reporting
periods and in its financial statements for annual reporting periods, the fair
value of all financial instruments for which it is practicable to estimate that
value, whether recognized or not recognized in the statement of financial
position, as required by SFAS 107. This FSP shall be effective for interim
reporting periods ending after June 15, 2009.  The new interim
disclosures required by this FSP will be included in the Company’s interim
financial statements beginning with the second quarter of 2009.
  10
 RPC,
INC. AND SUBSIDIARIES
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
  In April
2009, the FASB issued FSP SFAS 141R-1, “Accounting for Assets Acquired
and Liabilities Assumed in a Business Combination That Arise from
Contingencies.”  FSP SFAS 141R-1 amends the guidance in
SFAS 141R to require that assets acquired and liabilities assumed in a
business combination that arise from contingencies be recognized at fair value
if fair value can be reasonably estimated. If fair value of such an asset or
liability cannot be reasonably estimated, the asset or liability would generally
be recognized in accordance with SFAS 5, “Accounting for Contingencies,”
and FASB Interpretation (FIN) No. 14, “Reasonable Estimation of the Amount
of a Loss.” FSP SFAS 141R-1 removes subsequent accounting guidance for
assets and liabilities arising from contingencies from SFAS 141R and
requires entities to develop a systematic and rational basis for subsequently
measuring and accounting for assets and liabilities arising from contingencies.
FSP SFAS 141R-1 eliminates the requirement to disclose an estimate of
the range of outcomes of recognized contingencies at the acquisition date. For
unrecognized contingencies, entities are required to include only the
disclosures required by SFAS 5. FSP SFAS 141R-1 also requires
that contingent consideration arrangements of an acquiree assumed by the
acquirer in a business combination be treated as contingent consideration of the
acquirer and should be initially and subsequently measured at fair value in
accordance with SFAS 141R. FSP SFAS 141R-1 is effective for
assets or liabilities arising from contingencies the Company acquires in
business combinations occurring after January 1, 2009.
  5.
              COMPREHENSIVE
      INCOME
 
 The components of comprehensive
income are as follows:
 Three
      months ended
                                      March
      31,(In
      thousands)
                                    
                                    2009
                                    
                                    
                                    2008Net
      income as reported
                                    
                                    $
                                    4,466
                                    
                                    
                                    $
                                    14,757Pension
      adjustment, net of taxes
                                    
                                    
                                    309
                                    
                                    
                                    
                                    -Loss
      on cash flow hedge, net of taxes
                                    
                                    
                                    (114
                                    )
                                    
                                    
                                    -Foreign
      currency translation, net of taxes
                                    
                                    
                                    (164
                                    )
                                    
                                    
                                    44Unrealized
      (loss) gain on securities, net of taxes
                                    
                                    
                                    (70
                                    )
                                    
                                    
                                    19Comprehensive
      income
                                    
                                    $
                                    4,427
                                    
                                    
                                    $
                                    14,820
  11
  RPC,
INC. AND SUBSIDIARIES
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 
 6.
                STOCK-BASED
      COMPENSATION
 
 The
Company reserved 5,062,500 shares of common stock under its 2004 Stock Incentive
Plan which expires ten years from the date of approval.  This plan
provides for the issuance of various forms of stock incentives, including, among
others, incentive and non-qualified stock options and restricted
stock.  As of March 31, 2009, there were approximately 2,180,000
shares available for grants.
 
 Stock-based
employee compensation expense was as follows for the periods
indicated:
 
 Three
      months endedMarch
      31,(in
      thousands)
                                    
                                    2009
                                    
                                    
                                    2008Pre-tax
      expense
                                    
                                    $
                                    1,015
                                    
                                    
                                    $
                                    889After
      tax expense
                                    
                                    
                                    645
                                    
                                    
                                    
                                    576
  Stock
Options
  Transactions
involving RPC’s stock options for the three months ended March 31, 2009 were as
follows:
  Shares
                                                                                              
                                                                                              
                                                                                              Weighted
                                                                                                Average
                                                                                                Exercise
      Price
                                                                                              
                                                                                              
                                                                                              Weighted
                                                                                                Average
      Remaining Contractual
                                                                                                Life
                                                                                              
                                                                                              
                                                                                              Aggregate
      Intrinsic ValueOutstanding
      at January 1, 2009
                                                                                              
                                                                                              
                                                                                              1,108,022
                                                                                              
                                                                                              
                                                                                              $
                                                                                              3.12
                                                                                              
                                                                                              
                                                                                              2.68
      yearsGranted
                                                                                              
                                                                                              
                                                                                              -
                                                                                              
                                                                                              
                                                                                              
                                                                                              -
                                                                                              
                                                                                              
                                                                                              
                                                                                              N/AExercised
                                                                                              
                                                                                              
                                                                                              (204,112
                                                                                              )
                                                                                              
                                                                                              
                                                                                              2.75
                                                                                              
                                                                                              
                                                                                              
                                                                                              N/AForfeited
                                                                                              
                                                                                              
                                                                                              -
                                                                                              
                                                                                              
                                                                                              
                                                                                              -
                                                                                              
                                                                                              
                                                                                              
                                                                                              N/AExpired
                                                                                              
                                                                                              
                                                                                              -
                                                                                              
                                                                                              
                                                                                              
                                                                                              -
                                                                                              
                                                                                              
                                                                                              
                                                                                              N/AOutstanding
      and exercisable at March 31, 2009
                                                                                              
                                                                                              
                                                                                              903,910
                                                                                              
                                                                                              
                                                                                              $
                                                                                              3.41
                                                                                              
                                                                                              
                                                                                              2.99
      years
                                                                                              
                                                                                              
                                                                                              $
                                                                                              3,155,000
 
 The total
intrinsic value of stock options exercised was approximately $1,318,000 during
the three months ended March 31, 2009 and approximately $4,666,000 during the
three months ended March 31, 2008.  The tax benefits related to
options exercised totaled $100,000 during the three months ended March 31, 2009
and have been classified as financing cash flows in accordance with SFAS 123(R),
“Shared-Based Payments.”
  12
  RPC,
INC. AND SUBSIDIARIES
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 Restricted
Stock
 The
following is a summary of the changes in non-vested restricted shares for the
three months ended March 31, 2009:
 
 Shares
                                      
                                      
                                      Weighted
      Average
                                        Grant-Date
      Fair
                                        ValueNon-vested
      shares at January 1, 2009
                                      
                                      
                                      1,762,478
                                      
                                      
                                      $
                                      11.34Granted
                                      
                                      
                                      722,000
                                      
                                      
                                      
                                      8.55Vested
                                      
                                      
                                      (318,208
                                      )
                                      
                                      
                                      8.86Forfeited
                                      
                                      
                                      (2,500
                                      )
                                      
                                      
                                      14.49Non-vested
      shares at March 31, 2009
                                      
                                      
                                      2,163,770
                                      
                                      
                                      $
                                      10.48
 
 The total
fair value of shares vested during the three months ended March 31, 2009 was
approximately $2,712,000 and during the three months ended March 31, 2008 was
approximately $2,057,000.  The tax benefits for compensation tax
deductions in excess of compensation expense for the three months ended March
31, 2009 totaled approximately $87,000 and were credited to capital in excess of
par value and are classified as financing cash flows in accordance with SFAS
123R.
 
 Other
Information
 
 As of
March 31, 2009, total unrecognized compensation cost related to non-vested
restricted shares was approximately $22,160,000 which is expected to be
recognized over a weighted-average period of 4.2 years.  As of March
31, 2009, all of the compensation cost related to stock options has been
recognized.
 
 7.
                BUSINESS
      SEGMENT INFORMATION
 
 RPC’s
service lines have been aggregated into two reportable oil and gas services
segments, Technical Services and Support Services, because of the similarities
between the financial performance and approach to managing the service lines
within each of the segments, as well as the economic and business conditions
impacting their business activity levels.  Corporate includes selected
administrative costs incurred by the Company that are not allocated to business
units.  Gains or losses on disposition of assets are reviewed by the
Company’s chief decision maker on a consolidated basis, and accordingly the
Company does not report gains or losses at the segment level.
  13
 RPC,
INC. AND SUBSIDIARIES
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
  Technical
Services include RPC’s oil and gas service lines that utilize people and
equipment to perform value-added completion, production and maintenance services
directly to a customer’s well. These services include pressure pumping services,
snubbing, coiled tubing, nitrogen pumping, well control consulting and
firefighting, down-hole tools, wireline, and fluid pumping
services.  These Technical Services are primarily used in the
completion, production and maintenance of oil and gas wells. The principal
markets for this segment include the United States, including the Gulf of
Mexico, the mid-continent, southwest and Rocky Mountain regions, and
international locations including primarily Africa, Canada, China, Latin America
and the Middle East. Customers include major multi-national and independent oil
and gas producers, and selected nationally-owned oil companies.
 
 Support
Services include RPC’s oil and gas service lines that primarily provide
equipment for customer use or services to assist customer operations. The
equipment and services include drill pipe and related tools, pipe handling,
inspection and storage services and oilfield training services. The demand for
these services tends to be influenced primarily by customer drilling-related
activity levels. The principal markets for this segment include the United
States, including the Gulf of Mexico and the mid-continent regions, and
international locations, including primarily Canada, Latin America, and the
Middle East. Customers include domestic operations of major multi-national and
independent oil and gas producers, and selected nationally-owned oil
companies.
 
 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.
  Certain information with respect to
RPC’s business segments is set forth in the following
tables:
  Three
      months ended March 31,2009
                                                    
                                                    
                                                    2008(in
      thousands)Revenues:Technical
      Services
                                                    
                                                    $
                                                    151,079
                                                    
                                                    
                                                    $
                                                    169,231Support
      Services
                                                    
                                                    
                                                    25,192
                                                    
                                                    
                                                    
                                                    27,996Total
      revenues
                                                    
                                                    $
                                                    176,271
                                                    
                                                    
                                                    $
                                                    197,227Operating
      profit (loss):Technical
      Services
                                                    
                                                    $
                                                    6,149
                                                    
                                                    
                                                    $
                                                    20,687Support
      Services
                                                    
                                                    
                                                    3,706
                                                    
                                                    
                                                    
                                                    5,858Corporate
                                                    
                                                    
                                                    (3,180
                                                    )
                                                    
                                                    
                                                    (2,631
                                                    )Gain
      on disposition of assets, net
                                                    
                                                    
                                                    1,722
                                                    
                                                    
                                                    
                                                    1,527Total
      operating profit
                                                    
                                                    $
                                                    8,397
                                                    
                                                    
                                                    $
                                                    25,441Interest
      expense
                                                    
                                                    
                                                    (594
                                                    )
                                                    
                                                    
                                                    (1,471
                                                    )Interest
      income
                                                    
                                                    
                                                    33
                                                    
                                                    
                                                    
                                                    22Other
      income (expense), net
                                                    
                                                    
                                                    143
                                                    
                                                    
                                                    
                                                    (7
                                                    )Income
      before income taxes
                                                    
                                                    $
                                                    7,979
                                                    
                                                    
                                                    $
                                                    23,985
  14
  RPC,
INC. AND SUBSIDIARIES
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 
 Three
      months ended March 31, 2009
                                  
                                  Technical
                                    Services
                                  
                                  
                                  Support
                                    Services
                                  
                                  
                                  Corporate
                                  
                                  
                                  Total(in
      thousands)Identifiable
      assets at March 31, 2009
                                  
                                  $
                                  502,748
                                  
                                  
                                  $
                                  182,848
                                  
                                  
                                  $
                                  42,001
                                  
                                  
                                  $
                                  727,597Capital
      expenditures
                                  
                                  
                                  15,985
                                  
                                  
                                  
                                  3,374
                                  
                                  
                                  
                                  116
                                  
                                  
                                  
                                  19,475Depreciation
      and amortization
                                  
                                  
                                  21,603
                                  
                                  
                                  
                                  10,231
                                  
                                  
                                  
                                  186
                                  
                                  
                                  
                                  32,020
  8.
                INVENTORIES
 
 Inventories
of $56,611,000 at March 31, 2009 and $49,779,000 at December 31, 2008 consist of
raw materials, parts and supplies.
 
 9.
                EMPLOYEE
      BENEFIT PLAN
 
 The
following represents the net periodic benefit cost (credit) and related
components of the Company’s multiple employer Retirement Income
Plan:
  Three
      months ended
                                      March
      31,(in
      thousands)
                                    
                                    2009
                                    
                                    
                                    2008Service
      cost
                                    
                                    $
                                    -
                                    
                                    
                                    $
                                    -Interest
      cost
                                    
                                    
                                    485
                                    
                                    
                                    
                                    430Expected
      return on plan assets
                                    
                                    
                                    (380
                                    )
                                    
                                    
                                    (636
                                    )Amortization
      of net losses
                                    
                                    
                                    384
                                    
                                    
                                    
                                    71Net
      periodic benefit cost (credit)
                                    
                                    $
                                    489
                                    
                                    
                                    $
                                    (105
                                    )
 
 The
Company has not made any contributions to the plan during the three months ended
March 31, 2009 and does not currently expect to make any additional
contributions to this plan during the remainder of 2009.
 
 10.
                NOTES
      PAYABLE TO BANKS
  The
Company currently has a revolving credit agreement (the "Revolving Credit
Agreement") with SunTrust Capital Markets, Inc, as Joint Lead Arranger and Sole
Book Manager, Banc of America Securities LLC as Joint Lead Arranger, and a
syndicate of other lenders.  The Revolving Credit Agreement includes a
full and unconditional guarantee by RPC's 100% owned domestic subsidiaries whose
assets equal substantially all of the consolidated assets of RPC and its
subsidiaries.  The subsidiaries of the Company that are not guarantors
are considered minor.
  15
  RPC,
INC. AND SUBSIDIARIES
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
  The
Revolving Credit Agreement has a general term of five years and provides for an
unsecured line of credit of up to $296.5 million, which includes a $50 million
letter of credit subfacility, and a $20 million swingline subfacility. The
maturity date of all revolving loans under the Credit Agreement is September 8,
2011.  The Company has incurred loan origination fees and other debt
related costs associated with the line of credit and Commitment Increase
Amendment in the aggregate of approximately $514,000.  These costs are
being amortized over the remaining term of the five year loan, and the net
amount is classified as non-current other assets on the consolidated balance
sheets.
  Revolving
loans under the Revolving Credit Agreement bear interest at one of the following
two rates, at RPC's election:
  ●           the
Base Rate, which is the greater of SunTrust Bank's "prime rate" for the day of
the borrowing and a fluctuating rate per annum equal to the Federal Funds Rate
plus .50%; or
  ●           with
respect to any Eurodollar borrowings, Adjusted LIBOR (which equals LIBOR as
increased to account for the maximum reserve percentages established by the U.S.
Federal Reserve) plus a margin ranging from .40% to .80%, based upon RPC's
then-current consolidated debt-to-EBITDA ratio.  In addition, RPC will
pay an annual fee ranging from .10% to .20% of the total credit facility based
upon RPC's then-current consolidated debt-to-EBITDA ratio.
  The
Revolving Credit Agreement contains customary terms and conditions, including
certain financial covenants and restrictions on indebtedness, dividend payments,
business combinations and other related items.  Further, the Revolving
Credit Agreement contains financial covenants limiting the ratio of RPC's
consolidated debt-to-EBITDA to no more than 2.5 to 1, and limiting the ratio of
RPC's consolidated EBIT to interest expense to no less than 2 to 1.
  As of
March 31, 2009, RPC has outstanding borrowings of $132.5 million under the
Revolving Credit Agreement.Interest incurred on the
line of credit was $658,000 during the three months ended March 31, 2009 and
$1,748,000 during the three months ended March 31, 2008. The weighted average
interest rate was 1.7% for the three months ended March 31, 2009 and 4.4% for
the three months ended March 31, 2008.  For the three months ended
March 31, 2009, and March 31, 2008, the Company capitalized interest of
approximately $63,000 and $293,000 related to facilities and equipment under
construction.  Additionally there were letters of credit outstanding
relating to self-insurance programs and contract bids for $19.4 million as of
March 31, 2009.
  16
  RPC,
INC. AND SUBSIDIARIES
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
  Effective
December 2008 the Company entered into an interest rate swap agreement that
effectively converted $50 million of our variable-rate debt to a fixed rate
basis, thereby hedging against the impact of potential interest rate changes on
future interest expense.  The agreement terminates on September 8,
2011.  Under this agreement the Company pays a fixed interest rate of
2.07%.  In return, the issuing lender refunds the Company the
variable-rate interest paid to the syndicate of lenders under the Company’s
revolving credit agreement on the same notional amount, excluding the margin
that varies from 0.40% to 0.80%, depending upon RPC’s then-current consolidated
debt-to-EBITDA ratio.
 
 11.
                INCOME
      TAXES
 
 The
Company determines its periodic income tax expense based upon the current period
income and the annual estimated tax rate for the Company adjusted for any change
to prior period estimates. The estimated tax rate is revised, if necessary, as
of the end of each successive interim period during the fiscal year to the
Company's current annual estimated tax rate.
 
 12.
                SUPPLEMENTAL
      CASH FLOWS INFORMATION
 
 The
Company had accounts payable for purchases of property, plant and equipment of
approximately $14,222,000 as of March 31, 2009 and approximately $33,934,000 as
of March 31, 2008.
 
 13.
                FAIR
      VALUE DISCLOSURES
 
 The
Company adopted SFAS 157, “Fair Value Measurements,” and FSP 157-2, “Effective
Date of FASB Statement No. 157,” in the first quarter of 2008 for financial
assets and liabilities. SFAS 157 defines fair value, establishes a framework for
measuring fair value and expands disclosure requirements about items measured at
fair value.  SFAS 157 does not require any new fair value
measurements.  It applies to accounting pronouncements that already
require or permit fair value measures.
  17
  RPC,
INC. AND SUBSIDIARIES
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
  SFAS 157
establishes a fair value hierarchy that distinguishes between assumptions based
on market data (observable inputs) and the Company’s assumptions (unobservable
inputs).  The hierarchy consists of three broad levels as
follows:
 1.
                        Level
      1 – Quoted market prices in active markets for identical assets or
      liabilities.2.
                        Level
      2 – Inputs other than level 1 that are either directly or indirectly
      observable.3.
                        Level
      3 – Unobservable inputs developed using the Company’s estimates and
      assumptions, which reflect those that market participants would
      use.
 
 The
following table summarizes the valuation of financial instruments measured at
fair value on a recurring basis in the balance sheet as of March 31,
2009:
 
 Fair
      value measurements at March 31, 2009 with:(in
      thousands)
                                        
                                        Quoted
      prices in
                                          active
      markets for
                                          identical
      assets
                                        
                                        
                                        Significant
      other
                                          observable
      inputs
                                        
                                        
                                        Significant
                                          unobservable
                                          inputs(Level 1)
                                        
                                        
                                        (Level 2)
                                        
                                        
                                        (Level 3)Assets:Trading
      securities
                                        
                                        $
                                        4,868
                                        
                                        
                                        $
                                        -
                                        
                                        
                                        $
                                        -Available
      for sale securities
                                        
                                        
                                        401
                                        
                                        
                                        
                                        -
                                        
                                        
                                        
                                        -Liabilities:Interest
      rate swap
                                        
                                        $
                                        -
                                        
                                        
                                        $
                                        (1,010
                                        )
                                        
                                        $
                                        -
 
 The Company determines the fair value
of the marketable securities that are trading and available for sale through
quoted market prices.
 
 At March
31, 2009 and December 31, 2008, there was $132,500,000 and $174,450,000
outstanding under the Company’s Revolving Credit Agreement.  The
borrowings under our Revolving Credit Agreement bear interest at the variable
rate described in Note 10 and therefore approximate fair value at March 31, 2009
and December 31, 2008.  The Company is subject to interest rate risk
on the variable component of the interest rate.  The Company’s risk
management objective is to lock in the interest cash outflows on a portion of
our debt.  As a result, as described in Note 10, we entered into an
interest rate swap agreement to a fixed-rate, thereby hedging against the impact
of potential interest rate changes on future interest expense.  The
interest rate swap had a negative fair value, which is recorded in other
long-term liabilities, of $1,010,000 at March 31, 2009 and $830,000 at December
31, 2008.  The fair value of the interest rate swap was based on
quotes from the issuer of the swap and represents the estimated amounts that we
would expect to pay to terminate the swap.
  18
 RPC,
INC. AND SUBSIDIARIES
 
 NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
 In
February 2007, the FASB issued SFAS No. 159, “The Fair Value Option
for Financial Assets and Financial Liabilities — including an amendment of FASB
Statement No. 115.” This statement permits entities to choose to measure
many financial instruments and certain other items at fair value. This statement
is effective for financial statements issued for fiscal years beginning after
November 15, 2007, including interim periods within that fiscal year. The
Company did not elect the fair value option for any of its existing financial
instruments as of March 31, 2009 and the Company has not determined whether or
not it will elect this option for financial instruments it may acquire in the
future.
 
 19
  RPC, INC. AND
SUBSIDIARIES
  ITEM
      2.
                MANAGEMENT'S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS
  Overview
  The
following discussion should be read in conjunction with the Consolidated
Financial Statements included elsewhere in this document. See also
“Forward-Looking Statements” on page 29.
  RPC, Inc.
(“RPC”) provides a broad range of specialized oilfield services primarily to
independent and major oilfield companies engaged in exploration, production and
development of oil and gas properties throughout the United States, including
the Gulf of Mexico, mid-continent, southwest and Rocky Mountain regions, and
selected international locations.  The Company’s revenues and profits
are generated by providing equipment and services to customers who operate oil
and gas properties and invest capital to drill new wells and enhance production
or perform maintenance on existing wells.  We continuously monitor
factors that impact the level of current and expected customer activity levels,
such as the price of oil and natural gas, changes in pricing for our services
and equipment, and utilization of our equipment and personnel.  Our
financial results are affected by geopolitical factors such as political
instability in the petroleum-producing regions of the world, overall economic
conditions and weather in the United States, the prices of oil and natural gas,
and our customers’ drilling and production activities.
  The
discussion of our key business and financial strategies set forth under the
Overview section in the Company’s annual report on Form 10-K for the fiscal year
ended December 31, 2008 is incorporated herein by reference.  Since
year-end, the Company's operational strategies have not changed.
  During
the first quarter of 2009, revenues decreased 10.6 percent to $176.3 million
compared to the same period in the prior year.  The decline in
revenues is primarily due to lower equipment utilization and more competitive
pricing in most of our service lines.  International revenues for the
first quarter of 2009 increased due to increases in customer activity levels in
Egypt, Mexico and Canada partially offset by decreases in Kuwait and Gabon. We
continue to focus on developing international growth opportunities; however, it
is difficult to predict when contracts and projects will be initiated and their
ultimate duration.
  Cost of
revenues as a percentage of revenues increased approximately 2.7 percentage
points in the first quarter of 2009 compared to the same period of
2008.  This increase was due primarily to higher maintenance and
repairs expenses and negative leverage from direct personnel costs.
  Selling,
general and administrative expenses as a percentage of revenues increased by
approximately 1.3 percentage points in the first quarter of 2009 compared to the
same period in the prior year due to the fixed nature of several of these costs
and lower revenues.
  20
  RPC, INC. AND
SUBSIDIARIES
  Income
before income taxes declined to $8.0 million for the three months ended March
31, 2009 compared to $24.0 million in the prior year because of lower revenues
and higher depreciation expense.  The effective tax rate for the three
months ended March 31, 2009 was 44.0 percent compared to 38.5 percent in the
prior year.  Diluted earnings per share decreased to $0.05 for the
three months ended March 31, 2009 compared to $0.15 in the same period in the
prior year. Cash flows from operating activities were $66.0 million for the
three months ended March 31, 2009 compared to $46.7 million for the same period
in the prior year due to decreased working capital requirements, and cash and
cash equivalents were $2.3 million at March 31, 2009, a decrease of $0.7 million
compared to December 31, 2008.  The notes payable to banks were $132.5
million as of March 31, 2009, a reduction of $42.0 million compared
to $174.5 million as of December 31, 2008.
  Consistent
with our strategy to selectively grow our capacity and maintain our existing
fleet of high demand equipment, capital expenditures were $19.5 million during
the first three months of 2009. Although we currently expect capital
expenditures to be approximately $80 million during 2009, the total amount of
expenditures for the year will depend primarily on equipment maintenance
requirements and the ultimate delivery dates and timing of payments for
equipment delivered.  We expect these expenditures to be primarily
directed toward our larger, core service lines including primarily pressure
pumping, but also hydraulic workover, coiled tubing, nitrogen, and rental tools.
  Outlook
  Drilling
activity in the U.S. domestic oilfield, as measured by the rotary drilling rig
count, has been increasing for several years, reaching a cyclical peak of 2,031
rigs in the third quarter of 2008. Between the third quarter of 2008 and the end
of the first quarter of 2009, the rig count has declined
dramatically.  The annualized decline rate of 81.9 percent is the
steepest in U.S. history.  The overall domestic rig count during the
three months ended March 31, 2009 was approximately 24.1 percent lower than in
the comparable period in 2008.  The unconventional rig count declined
as well, but by less than the overall rig count.  The unconventional
rig count during the first quarter of 2009 was 56.6 percent of the total rig
count, which is higher than the prior year.  RPC’s growth strategy has
focused on unconventional drilling, so this relatively stronger unconventional
rig count is one reason that RPC’s revenues declined at a lower rate than the
overall domestic rig count.  The average price of oil decreased by
approximately 55.5 percent and the average price of natural gas decreased by
approximately 47.6 percent during the three months ended March 31, 2009 compared
to the prior year.  The softness in natural gas and oil prices and the
steep, rapid decline in the rig count, along with the global recession and
financial crisis, have reduced our customers’ demands for our
services.  Indications during the second quarter of 2009 are that
customer activity levels will continue to decline during the near
term.
  Our
response to the industry's severe downturn has been to reduce expenses and
capital expenditures, thereby maintaining sufficient liquidity to continue our
operations and maintain a conservative capital structure.  We
decreased the borrowings under our syndicated credit facility during the first
three months of 2009 due to lower capital expenditures, and lower
working capital requirements due to decreased activity levels.
  21
  RPC, INC. AND
SUBSIDIARIES
  We expect
revenues will be lower in 2009 than in 2008.  Although we project that
the cost of critical materials used in performing our services, selling, general
and administrative expenses, and interest expense will be lower in 2009 than in
2008, these cost reductions will be more than offset by the decline in
revenues.  In all of our service lines and geographic markets, we are
experiencing the negative impacts of increased competition and lower oilfield
activity.  These negative impacts include lower pricing for our
services and lower utilization of our equipment.  One positive impact
of the current depressed environment is that competition for qualified employees
has declined tremendously which has caused the upward labor cost pressure we
have experienced over the past few years to abate.  Subsequent to
March 31, 2009, we reduced base salaries and wages as well as incentive
compensation for most of our employees, and believe that if these negative
conditions persist we will retain these employees in spite of these actions
because of the decline in competition for labor.  We may evaluate
consolidation of certain under-performing facilities in the future if activity
continues to decline.  In addition, we believe that the costs of
certain raw materials used in providing our services, such as the proppant used
in our pressure pumping service line, will decline due to lower oilfield
activity and increased supplies of this material.
  Further
discussion of the Company’s outlook is set forth under the Outlook section in
the Company’s annual report on Form 10-K for the fiscal year ended December 31,
2008 and is incorporated herein by reference.  There have been no
significant changes in the Company’s outlook since the filing of the 10-K for
2008 except as discussed above.
 
 RESULTS OF
OPERATIONS
 
 Three
      months ended
                                    March
      31,2009
                                  
                                  
                                  2008Consolidated
      revenues [in thousands]
                                  
                                  $
                                  176,271
                                  
                                  
                                  $
                                  197,227Revenues
      by business segment [in thousands]:Technical
                                  
                                  $
                                  151,079
                                  
                                  
                                  $
                                  169,231Support
                                  
                                  
                                  25,192
                                  
                                  
                                  
                                  27,996Consolidated
      operating profit [in thousands]
                                  
                                  $
                                  8,397
                                  
                                  
                                  $
                                  25,441Operating
      profit (loss) by business segment [in thousands]:Technical
                                  
                                  $
                                  6,149
                                  
                                  
                                  $
                                  20,687Support
                                  
                                  
                                  3,706
                                  
                                  
                                  
                                  5,858Corporate
                                  
                                  
                                  (3,180
                                  )
                                  
                                  
                                  (2,631
                                  )Gain
      on disposition of assets, net
                                  
                                  $
                                  1,722
                                  
                                  
                                  $
                                  1,527Percentage
      cost of revenues to revenues
                                  
                                  
                                  62
                                  %
                                  
                                  
                                  60
                                  %Percentage
      selling, general & administrative expenses to revenues
                                  
                                  
                                  16
                                  %
                                  
                                  
                                  14
                                  %Percentage
      depreciation and amortization expense to revenues
                                  
                                  
                                  18
                                  %
                                  
                                  
                                  14
                                  %Average
      U.S. domestic rig count
                                  
                                  
                                  1,344
                                  
                                  
                                  
                                  1,770Average
      natural gas price (per thousand cubic feet (mcf))
                                  
                                  $
                                  4.52
                                  
                                  
                                  $
                                  8.63Average
      oil price (per barrel)
                                  
                                  $
                                  43.65
                                  
                                  
                                  $
                                  98.03
  22
  RPC, INC. AND
SUBSIDIARIES
  THREE MONTHS ENDED MARCH 31,
2009 COMPARED TO THREE MONTHS ENDED MARCH 31, 2008
  Revenues.Revenues
for the three months ended March 31, 2009 decreased 10.6 percent compared to the
three months ended March 31, 2008.  Domestic revenues decreased 12
percent to $166.7 million compared to the same period in the prior
year.  The decreases in revenues are due primarily to lower equipment
utilization and more competitive pricing in most of our service
lines.  International revenues increased from $8.4 million to $9.7
million compared to the prior year quarter.  Our international
revenues are impacted by the timing of project initiation and their ultimate
duration and can be volatile in nature.
  The
average price of natural gas decreased approximately 47.6 percent and the
average price of oil decreased 55.5 percent during the first quarter of 2009 as
compared to the prior year.  The average domestic rig count during the
quarter was approximately 24.1 percent lower than the same period in
2008.  This decrease in drilling activity had a negative impact on our
financial results.  We believe that our activity levels are affected
more by the price of natural gas than by the price of oil, because the majority
of U.S. domestic drilling activity relates to natural gas, and many of our
services are more appropriate for gas wells than oil wells.
  The
Technical Services segment revenues for the quarter decreased 10.7 percent
compared to the first quarter of last year.  Revenues in this segment
decreased due primarily to competitive pricing and lower equipment utilization.
The Support Services segment revenues for the quarter fell by 10.0 percent
compared to the first quarter of prior year.  This decline was due
primarily to decreased activity in the rental tool service line, the largest
within this segment.  Operating profit decreased in both segments
primarily due to lower revenues and higher costs and expenses as a percentage of
revenues.
  Cost of revenues. Cost of
revenues decreased 6.5 percent to $110.0 million for the three months ended
March 31, 2009 compared to $117.7 million for three months ended March 31,
2008.  This decrease was due to the variable nature of several of
these expenses, including fuel and materials and supplies. Cost of revenues, as
a percentage of revenues, increased in the first quarter of 2009 compared to the
first quarter of 2008 due primarily to higher maintenance and repairs expenses
and negative leverage from direct personnel costs.
  Selling, general and administrative
expenses. Selling, general and administrative expenses for
the three months ended March 31, 2009 decreased 2.5 percent to $27.6 million
compared to $28.3 million for the three months ended March 31, 2008. This
decrease was primarily due to lower incentive compensation costs and the impact
of cost control measures.  However, these costs as a percent of
revenues increased during the three months ended March 31, 2009 compared to the
same period in the prior year due to lower revenues and the fixed nature of
several of these expenses.
  Depreciation and
amortization. Depreciation and amortization totaled $32.0
million for the three months ended March 31, 2009, a 17.2 percent increase,
compared to $27.3 million for the quarter ended March 31, 2008. This increase in
depreciation and amortization resulted from capital expenditures made during the
last year within both Technical Services and Support Services to increase
capacity, expand facilities and to maintain our existing fleet of
equipment.
  23
  RPC, INC. AND
SUBSIDIARIES
  Gain on disposition of assets,
net.  Gain on disposition of assets, net was $1.7 million for
the three months ended March 31, 2009 compared to $1.5 million for the three
months ended March 31, 2008.  The gain on disposition of assets, net
includes gains or losses related to various property and equipment dispositions
or sales to customers of lost or damaged rental equipment.
  Other income (expense), net.Other income (expense), net was $143 thousand for the three months ended
March 31, 2009 and $(7) thousand for the same period in the prior
year.  Other income (expense), net primarily includes gains and losses
from investments in the non-qualified benefit plan being marked to market,
settlements of various legal and insurance claims, and royalty
receipts.
  Interest expense and interest
income.Interest expensewas $594 thousand for
the three months ended March 31, 2009 compared to $1.5 million for the quarter
ended March 31, 2008.  The decrease in 2008 is due to lower interest
rates and lower average balance on our revolving line of credit, net of interest
capitalized on equipment and facilities under construction.  Interest
income was $33 thousand for the three months ended March 31, 2009 and $22
thousand for the three months ended March 31, 2008.
  Income tax provision.Income
tax provision was $3.5 million during the three months ended March 31, 2009,
compared to $9.2 million in 2008.  This decrease was due to the
decrease in income before taxes.  The effective tax rate was 44.0
percent for the three months ended March 31, 2009 compared to 38.5 percent for
the three months ended March 31, 2008.  The higher rate results
primarily from pretax income declining at a faster rate than our non deductible
permanent tax differences.
 
 24
  RPC, INC. AND
SUBSIDIARIES
  LIQUIDITY
AND CAPITAL RESOURCES
 
 Cash
Flows
  The
Company’s cash and cash equivalents at March 31, 2009 were $2.3
million.  The following table sets forth the historical cash flows for
the three months ended March 31, 2009 and 2008:
 
 Three
      months ended March 31,(In
      thousands)
                                    
                                    2009
                                    
                                    
                                    2008Net
      cash provided by operating activities
                                    
                                    $
                                    66,021
                                    
                                    
                                    $
                                    46,727Net
      cash used for investing activities
                                    
                                    
                                    (16,904
                                    )
                                    
                                    
                                    (43,869
                                    )Net
      cash (used for) provided by financing activities
                                    
                                    
                                    (49,842
                                    )
                                    
                                    
                                    2,294
  Cash
provided by operating activities for the three months ended March 31, 2009
increased by $19.3 million compared to the comparable period in the prior
year.  Although net income decreased $10.3 million for the three
months ended March 31, 2009 compared to the same period of 2008, cash provided
by operating activities increased due primarily to decreases in working capital,
and an increase in depreciation due to higher capital expenditures in 2008. The
significant changes in working capital requirements were decreases in accounts
receivable, as revenue declined, partially offset by decreases in accounts
payable from lower activity levels, and increases in inventory.
  Cash used
for investing activities for the three months ended March 31, 2009 decreased by
$27.0 million, compared to the three months ended March 31, 2008, as a result of
lower capital expenditures.
  Cash used
for financing activities for the three months ended March 31, 2009 increased by
$52.1 million, compared to the three months ended March 31, 2008, due to an
increase in net repayments of notes payable to banks and an increase in
dividends per share paid to common stockholders, partially offset by lower open
market repurchases of the Company’s shares.
  Financial
Condition and Liquidity
  The
Company’s financial condition as of March 31, 2009, remains
strong.  We believe the liquidity provided by our existing cash and
cash equivalents, our overall strong capitalization, cash expected to be
generated from operations and our credit facility will provide sufficient
capital to meet our requirements for at least the next twelve
months.  The Company currently has a $296.5 million revolving credit
facility (the “Revolving Credit Agreement”) that matures in September 2011.The Revolving Credit
Agreement contains customary terms and conditions, including certain financial
covenants including covenants restricting RPC’s ability to incur liens or merge
or consolidate with another entity.  Our outstanding borrowings were
$132.5 million at March 31, 2009 and approximately $15.1 million of the credit
facility supports outstanding letters of credit relating to self-insurance
programs or contract bids.  A total of $148.9 million was available
under our facility as of March 31, 2009.  Additional information
regarding our Revolving Credit Agreement is included in Note 10 to our
Consolidated Financial Statements included in this report.
  25
  RPC, INC. AND
SUBSIDIARIES
  The
Company’s decisions about the amount of cash to be used for investing and
financing purposes are influenced by its capital position, including access to
borrowings under our credit facility, and the expected amount of cash to be
provided by operations.  We believe our liquidity will continue to
provide the opportunity to grow our asset base and revenues during periods with
positive business conditions and strong customer activity levels.  In
addition, the Company’s decisions about the amount of cash to be used for
investing and financing activities may also be influenced by the financial
covenants in our credit facility.
  26
  RPC, INC. AND
SUBSIDIARIES
  Cash
Requirements
  The
Company currently expects that capital expenditures during 2009 will be
approximately $80 million, of which $19.5 million has been spent as of March 31,
2009.  We expect these expenditures to be primarily directed towards
revenue-producing equipment in our larger, core service lines including pressure
pumping, snubbing, nitrogen, and rental tools. The actual amount of 2009
expenditures will depend primarily on equipment maintenance requirements,
expansion opportunities, and equipment delivery schedules.
  The
Company has ongoing sales and use tax audits in various jurisdictions and may be
subjected to varying interpretations of statutes that could result in
unfavorable outcomes that cannot be currently estimated.
  The
Company’s Retirement Income Plan, a multiple employer trusteed defined benefit
pension plan, provides monthly benefits upon retirement at age 65 to eligible
employees.  The Company did not make any contributions to the pension
plan in the three months ended March 31, 2009 and does not currently expect to
make any contributions to the pension plan for the remainder of
2008.
  The
Company’s Board of Directors announced a stock buyback program on March 9, 1998
authorizing the repurchase of 11,812,500 shares.  The Company
repurchased no shares of common stock under the program during the three months
ended March 31, 2009 but may repurchase outstanding common shares periodically
based on market conditions and our capital allocation strategies and
restrictions under our credit facility.  The stock buyback program
does not have a predetermined expiration date.
  On April
28, 2009, the Board of Directors approved a $0.07 per share cash dividend
payable June 10, 2009 to stockholders of record at the close of business May 8,
2009.  The Company expects to continue to pay cash dividends to common
stockholders, subject to the earnings and financial condition of the Company and
other relevant factors.
 
 INFLATION
  The
Company purchases its equipment and materials from suppliers who provide
competitive prices, and employs skilled workers from competitive labor
markets.  If inflation in the general economy increases, the Company’s
costs for equipment, materials and labor increase as well.  Due to the
increases in activity in the domestic oilfield, as well as a shortage of a
skilled work force due to historically low activity in the oilfield, the Company
experienced upward wage pressures in the labor markets from which it hires
employees for several years.  However, this pressure abated with the
sudden, steep decline in domestic oilfield activity which began in the third
quarter of 2008.  The Company has recently reduced the compensation of
salaried and hourly employees and changed the structure of incentive
compensation plans, thus lowering these costs.  The Company has
experienced shortages for critical materials used in some of its largest service
lines over the past several years, and these shortages have caused price
increases for these materials as well as higher transportation costs, since some
alternative suppliers are located farther from the Company’s operational
locations than the original suppliers.  Inventory levels have also
grown due to price increases and our purchases of large quantities of these
materials in order to receive quantity discounts.  We believe that
this cost pressure is abating as well, due to lower oilfield activity coupled
with supply increases from international sources.   If these
trends continue, the Company’s costs and working capital requirements relating
to labor and materials and supplies will be lower in the
future.  However, such lower costs many not necessarily lead to higher
future profitability, as the Company is experiencing tremendous competitive
pricing pressures for its services due to lower oilfield activity and a large
amount of oilfield service capacity in the markets in which we
operate.
  27
  RPC, INC. AND
SUBSIDIARIES
  OFF BALANCE SHEET
ARRANGEMENTS
 
 The Company does not have any material
off balance sheet arrangements.
 
 RELATED PARTY TRANSACTIONS
  Marine
Products Corporation
  Effective
February 28, 2001, the Company spun-off the business conducted through Chaparral
Boats, Inc, RPC’s former powerboat manufacturing segment.  In
conjunction with the spin-off, RPC and Marine Products entered into various
agreements that define the companies’ relationship.  A detailed
discussion of the various agreements in effect is contained in the Company’s
annual report on Form 10-K for the year ended December 31,
2008.  During the three months ended March 31, 2009, RPC charged
Marine Products for its allocable share of administrative costs incurred for
services rendered on behalf of Marine Products totaling $227,000 compared to
$263,000 for the comparable period in 2008.
  Other
  The
Company periodically purchases in the ordinary course of business products or
services from suppliers who are owned by officers or significant shareholders
of, or affiliated with the directors of RPC. The total amounts paid to these
affiliated parties were approximately $176,000 for the three months ended March
31, 2009 and $91,000 for the three months ended March 31, 2008.
  RPC
receives certain administrative services and rents office space from Rollins,
Inc. (a company of which Mr. R. Randall Rollins is also Chairman, and which is
controlled by Mr. Rollins and his affiliates).  The service agreements
between Rollins, Inc. and the Company provide for the provision of services on a
cost reimbursement basis and are terminable on six months notice.  The
services covered by these agreements include office space, selected
administration services for certain employee benefit programs, and other
administrative services. Charges to the Company (or to corporations which are
subsidiaries of the Company) for such services and rent aggregated approximately
$24,000 for the three months ended March 31, 2009 and $21,000 for the three
months ended March 31, 2008.
 
 28
 
 RPC, INC. AND
SUBSIDIARIES
 
 CRITICAL ACCOUNTING
POLICIES
  The
discussion of Critical Accounting Policies is incorporated herein by reference
from the Company’s annual report on Form 10-K for the fiscal year ended December
31, 2008.  There have been no significant changes in the critical
accounting policies since year-end.
  IMPACT OF RECENT ACCOUNTING
PRONOUNCEMENTS
  See
Notes 4 and 13 of the Notes to Consolidated Financial Statements for a
description of recent accounting pronouncements, including the expected dates of
adoption and estimated effects on results of operations and financial
condition.
 
 SEASONALITY
 
 Oil and natural gas prices affect
demand throughout the oil and natural gas industry, including the demand for the
Company’s products and services. The Company’s business depends in large part on
the conditions of the oil and gas industry, and specifically on the capital
expenditures of its customers related to the exploration and production of oil
and natural gas.  There is a positive correlation between these
expenditures and customers’ demand for the Company’s services.  As
such, when these expenditures fluctuate, customers’ demand for the Company’s
services fluctuates as well.  These fluctuations depend on the current
and projected prices of oil and natural gas and resulting drilling activity, and
are not seasonal to any material degree.
 
 FORWARD-LOOKING
STATEMENTS
 
 Certain statements made in this report
that are not historical facts are “forward-looking statements” under Section 21E
of the Securities Exchange Act of 1934 and the Private Securities Litigation
Reform Act of 1995. Such forward-looking statements may include, without
limitation, statements regarding the effect of recent accounting pronouncements
on the Company’s consolidated financial statements, forecasted revenues, costs,
expenses and operating profit for 2009, forecasted lower income before taxes and
net income in 2009 compared to 2008, our belief that customer activity levels
will continue to decline during the near term, our ability to retain our
employees, our business strategy, plans and objectives, market risk exposure,
adequacy of capital resources and funds, opportunity for growth and expansion,
anticipated pension funding payments and capital expenditures, expectations as
to future payment of dividends, the possible unfavorable outcome of sales and
use tax audits, the impact of inflation and related trends on the Company’s
financial position and operating results, our beliefs and expectations regarding
future demand for our products and services, and other events and conditions
that may influence the oilfield services market and our performance in the
future.  The Company does not undertake to update its forward-looking
statements.
  29
 RPC, INC. AND
SUBSIDIARIES
  The words “may,” “will,” “expect,”
“believe,” “anticipate,” “project,” “estimate,” “focus,” “plan,” and similar
expressions generally identify forward-looking statements. Such statements are
based on certain assumptions and analyses made by our management in light of its
experience and its perception of historical trends, current conditions, expected
future developments and other factors it believes to be
appropriate.  These statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results, performance
or achievements of RPC to be materially different from any future results,
performance or achievements expressed or implied in such forward looking
statements.  Risk factors that could cause such future events not to
occur as expected include those described in the Company's Annual Report on Form
10-K for the fiscal year ended December 31, 2008, its other SEC filings and the
following:  the declines in the price of oil and natural gas, which
tend to result in a decrease in drilling activity and therefore a decline in the
demand for our services, the actions of the OPEC cartel, the ultimate impact of
current and potential political unrest and armed conflict in the oil producing
regions of the world, which could impact drilling activity, adverse weather
conditions in oil or gas producing regions, including the Gulf of Mexico,
competition in the oil and gas industry, the Company’s ability to implement
price increases, and risks of international operations.
 
 ITEM
      3.
                QUANTITATIVE
      AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
  The
Company is subject to interest rate risk exposure through borrowings on its
credit facility.  As of March 31, 2009, there are outstanding
interest-bearing advances of $132.5 million on our credit facility which bear
interest at a floating rate.  Effective December 2008 we entered into
a $50 million interest rate swap agreement that effectively converted this
portion of the outstanding variable-rate borrowings under the Revolving Credit
Agreement to a fixed-rate basis, thereby hedging against the impact of potential
interest rate changes.  Under this agreement, we pay a fixed interest
rate of 2.07% and in return, the issuing lender refunds us the variable-rate
interest paid to the syndicate of lenders under our Revolving Credit Agreement
on the same notional amount, excluding the margin. The swap agreement terminates
on September 8, 2011.  As of March 31, 2009 the interest rate swap had
a negative fair value of $1,010,000 and is reflected in other long-term
liabilities on the balance sheet.  An increase in interest rates of
one percent would result in the interest rate swap having a positive fair value
of approximately $155,000.  A decrease in interest rates of one
percent would result in the interest rate swap having a negative fair value of
approximately $2,194,000.  A change in interest rates will have no
impact on the interest expense associated with the $50,000,000 of borrowings
under the Revolving Credit Agreement that are subject to the interest rate
swap.  A change in the interest rate of one percent on the remaining
outstanding balance of the credit facility at March 31, 2009 not subject to the
interest rate swap would cause a change of $825,000 in total annual interest
costs.
  30
 
 RPC, INC. AND
SUBSIDIARIES
 
 ITEM
      4.
                CONTROLS
      AND PROCEDURES
  Evaluation of disclosure controls
and procedures– The
Company maintains disclosure controls and procedures that are designed to ensure
that information required to be disclosed in its Exchange Act reports is
recorded, processed, summarized and reported within the time periods specified
in the Commission’s rules and forms, and that such information is accumulated
and communicated to its management, including the Chief Executive Officer and
Chief Financial Officer, as appropriate, to allow timely decisions regarding
required disclosure.
  As of the
end of the period covered by this report, March 31, 2009 (the “Evaluation
Date”), the Company carried out an evaluation, under the supervision and with
the participation of its management, including the Chief Executive Officer and
Chief Financial Officer, of the effectiveness of the design and operation of its
disclosure controls and procedures.  Based upon this evaluation, the
Chief Executive Officer and the Chief Financial Officer concluded that the
Company’s disclosure controls and procedures were effective at a reasonable
assurance level as of the Evaluation Date.
  Changes in internal control over
financial reporting – Management’s evaluation of changes in internal
control did not identify any changes in the Company’s internal control over
financial reporting that occurred during the Company’s most recent fiscal
quarter that have materially affected, or are reasonably likely to materially
affect, the Company’s internal control over financial reporting.
  31
 
 RPC, INC. AND
SUBSIDIARIES
 
 PART
II.  OTHER INFORMATION
 
 ITEM
      1.
                  LEGAL
      PROCEEDINGS
 
 RPC is
involved in litigation from time to time in the ordinary course of its
business.  RPC does not believe that the outcome of such litigation
will have a material adverse effect on the financial position or results of
operations of RPC.
 
 ITEM
      1A.
                  RISK
      FACTORS
 
 See risk
factors described in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2008.
 
 ITEM
      2.
                UNREGISTERED
      SALES OF EQUITY SECURITIES AND USE OF
PROCEEDS
  Purchases
of Equity Securities by the Issuer and Affiliated Purchasers
  Shares
repurchased by the Company and affiliated purchases in the first quarter of 2009
are outlined below.
  Total
      Number of
                                                                                                          
                                                                                                          
                                                                                                          Maximum
      Number (orShares
      (or Units)
                                                                                                          
                                                                                                          
                                                                                                          Approximate
      Dollar Value) ofTotal
      Number of
                                                                                                          
                                                                                                          
                                                                                                          
                                                                                                          
                                                                                                          
                                                                                                          Purchased
      as Part of
                                                                                                          
                                                                                                          
                                                                                                          Shares
      (or Units) that May YetShares
      (or Units)
                                                                                                          
                                                                                                          
                                                                                                          Average
      Price Paid
                                                                                                          
                                                                                                          
                                                                                                          Publicly
      Announced
                                                                                                          
                                                                                                          
                                                                                                          Be
      Purchased Under the PlansPeriod
                                                                                                          
                                                                                                          Purchased
                                                                                                          
                                                                                                          
                                                                                                          Per
      Share (or Unit)
                                                                                                          
                                                                                                          
                                                                                                          Plans
      or Programs
                                                                                                          
                                                                                                          
                                                                                                          or
      Programs (1)Month
      #1January
      1, 2009 to January 31, 2009
                                                                                                          
                                                                                                          
                                                                                                          201,862
                                                                                                          (2)
                                                                                                          
                                                                                                          $
                                                                                                          8.22
                                                                                                          
                                                                                                          
                                                                                                          
                                                                                                          -
                                                                                                          
                                                                                                          
                                                                                                          
                                                                                                          2,807,265Month
      #2February
      1, 2009 to February 28, 2009
                                                                                                          
                                                                                                          
                                                                                                          -
                                                                                                          
                                                                                                          
                                                                                                          
                                                                                                          -
                                                                                                          
                                                                                                          
                                                                                                          
                                                                                                          -
                                                                                                          
                                                                                                          
                                                                                                          
                                                                                                          2,807,265Month
      #3March
      1, 2009 to March 31, 2009
                                                                                                          
                                                                                                          
                                                                                                          -
                                                                                                          
                                                                                                          
                                                                                                          
                                                                                                          -
                                                                                                          
                                                                                                          
                                                                                                          
                                                                                                          -
                                                                                                          
                                                                                                          
                                                                                                          
                                                                                                          2,807,265Totals
                                                                                                          
                                                                                                          
                                                                                                          201,862
                                                                                                          
                                                                                                          
                                                                                                          $
                                                                                                          8.22
                                                                                                          
                                                                                                          
                                                                                                          
                                                                                                          -
                                                                                                          
                                                                                                          
                                                                                                          
                                                                                                          2,807,265
 (1)
                              The
      Company’s Board of Directors announced a stock buyback program in March
      1998 authorizing the repurchase of 11,812,500 shares in the open market.
      Currently the program does not have a predetermined expiration
      date.(2)
                              Consists
      of shares repurchased by the Company in connection with option exercises
      and taxes related to the vesting of restricted shares.
  32
 RPC, INC. AND
SUBSIDIARIES
  ITEM
      3.
                DEFAULTS
      UPON SENIOR SECURITIES
 
 None
 
 ITEM
      4.
                SUBMISSION
      OF MATTERS TO A VOTE OF SECURITY
HOLDERS
 
 None
 
 ITEM
      5.
                OTHER
      INFORMATION
 
 None
  33
 
 RPC, INC. AND
SUBSIDIARIES
  ITEM 6.
              Exhibits
  Exhibit
                      Number
                    
                    Description3.1(a)
                    
                    Restated
      certificate of incorporation of RPC, Inc. (incorporated herein by
      reference to Exhibit 3.1 to the Annual Report on Form 10-K for the fiscal
      year ended December 31, 1999).3.1(b)
                    
                    Certificate
      of amendment of the certificate of incorporation of RPC, Inc.
      (incorporated by reference to Exhibit 3.1(b) to Registrant’s Quarterly
      Report on Form 10-Q filed on May 8, 2006).3.2
                    
                    Amended
      and Restated Bylaws of RPC, Inc. (incorporated herein by reference to
      Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on
      October 25, 2007).4
                    
                    Form
      of Stock Certificate (incorporated herein by reference to Exhibit 4 to the
      Registrant’s Annual Report on Form 10-K for the fiscal year ended December
      31, 1998).31.1
                    
                    Section
      302 certification for Chief Executive Officer.31.2
                    
                    Section
      302 certification for Chief Financial Officer.32.1
                    
                    Section
      906 certifications for Chief Executive Officer and Chief Financial
      Officer.
 
 34
  RPC, INC. AND SUBSIDIARIES
  SIGNATURES
 
 Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
 
 RPC,
      INC./s/
      Richard A. HubbellDate:  May
      5, 2009
                      Richard
      A. HubbellPresident
      and Chief Executive Officer(Principal
      Executive Officer)/s/
      Ben M. PalmerDate:  May
      5, 2009
                      Ben
      M. PalmerVice
      President and Chief Financial Officer(Principal
      Financial and Accounting Officer)






35