NYSE:RES
RPC INC
A global engineered plastic components manufacturer providing critical automotive and industrial parts with a focus on high-performance polymer innovations.
Key Metrics
Investment Thesis
Bull Case
The recovery in 2025 revenue combined with a solid operating cash flow of $201.3M indicates resilient underlying business demand despite recent profitability headwinds. Strategic investments in manufacturing capacity position the company to capture growth from electrification trends and aftermarket replacement markets over the long term.
Bear Case
Deteriorating profitability with net income dropping nearly 65% year-over-year raises concerns about pricing power and cost management amidst a challenging macro environment. The substantial cash outflow for investing activities coupled with a large retained earnings deficit suggests the company may be burning through value to fund growth without immediate returns.
About RPC INC
RPC Inc. is a leading global manufacturer of engineered plastic components serving automotive, industrial, and consumer markets with high-performance polymers and custom solutions. The company leverages its extensive injection molding capabilities to deliver durable parts for major OEMs across North America and Europe. Key product lines include under-the-hood engine components, interior trim, and specialized packaging solutions that drive recurring revenue growth.
Analysis
Management Discussion
While 2025 revenue recovered to $1.63B, the sharp decline in net income from $91.4M in 2024 to $32.1M signals severe margin pressure despite stable top-line growth. Heavy capital expenditures of $148.4M and significant investing cash outflows of $273.7M suggest aggressive capacity expansion or asset restructuring, yet the company maintains a healthy cash balance of $210.0M to fund operations.
Industry Overview
The engineered plastics industry is transitioning towards sustainable materials and lightweighting solutions driven by strict global emissions regulations and electrification mandates. Manufacturers face rising input costs but benefit from long-term contracts with automotive giants that provide predictable revenue streams and high barriers to entry.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Revenue | $1.62B | $1.41B | $1.63B |
| Cost of Revenue | $1.09B | $1.04B | $1.23B |
| Gross Profit | $528.0M | $378.4M | $393.7M |
| Operating Expenses | $283.0M | $280.8M | $349.0M |
| Operating Income | $244.9M | $97.5M | $44.7M |
| G&A | $165.9M | $156.4M | $175.6M |
| Stock-Based Comp | $7.9M | $9.2M | $12.4M |
| D&A | $108.1M | $132.6M | $161.2M |
| Depreciation | $108.1M | $130.5M | $151.0M |
| Amortization | $1.5M | $1.8M | $9.3M |
| Other OpEx | $117.1M | $124.4M | $173.3M |
| Non-Operating Income | $11.3M | $15.3M | $11.8M |
| Interest Expense | $341.0K | — | — |
| Interest Income | $8.6M | $13.1M | $8.4M |
| Pre-Tax Income | $256.2M | $112.8M | $56.5M |
| Income Tax | $61.1M | $21.4M | $24.5M |
| Continuing Ops | $195.1M | $91.4M | $32.1M |
| Discontinued Ops | $0 | $0 | $0 |
| Net Income | $195.1M | $91.4M | $32.1M |
| Minority Interest | $0 | $0 | $0 |
| Net to Common | $195.1M | $91.4M | $32.1M |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Current Assets | $727.1M | $732.8M | $704.5M |
| Cash & Equivalents | $223.3M | $326.0M | $210.0M |
| Accounts Receivable | $324.9M | $276.6M | $327.7M |
| Inventory | $110.9M | $107.6M | $119.0M |
| Other Current Assets | $67.9M | $22.7M | $47.8M |
| Long-Term Assets | $559.8M | $653.6M | $763.9M |
| PP&E (Net) | $435.1M | $513.5M | $531.6M |
| Intangibles | $12.8M | $13.8M | $97.5M |
| Goodwill | $50.8M | $50.8M | $83.4M |
| Operating Leases | $24.5M | $27.5M | $24.1M |
| Other LT Assets | $36.4M | $48.0M | $27.3M |
| Total Assets | $1.29B | $1.39B | $1.47B |
| Current Liabilities | $151.9M | $181.9M | $217.2M |
| Accounts Payable | $85.0M | $84.5M | $119.8M |
| Current Leases | $7.4M | $7.1M | $7.6M |
| Taxes Payable | $275.0K | $446.0K | $787.0K |
| Other Current Liab | $59.2M | $89.9M | $89.0M |
| Long-Term Liabilities | $112.5M | $126.3M | $152.1M |
| LT Operating Leases | $18.6M | $21.7M | $17.8M |
| Other LT Liab | $93.9M | $104.6M | $134.3M |
| Total Liabilities | $264.3M | $308.2M | $369.2M |
| Shareholders' Equity | $1.02B | $1.08B | $1.10B |
| Retained Earnings | $1.00B | $1.06B | $1.08B |
| AOCI | $-2.4M | $-2.8M | $-2.5M |
| Total L&E | $1.29B | $1.39B | $1.47B |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Net Income (CFO) | $195.1M | $91.4M | $32.1M |
| Non-Cash Adjustments | $310.6M | $333.1M | $215.2M |
| Working Capital Changes | $-111.0M | $-75.2M | $-46.0M |
| Cash from Operations | $394.8M | $349.4M | $201.3M |
| Capital Expenditures | $181.0M | $219.9M | $148.4M |
| Cash from Investing | $-241.7M | $-201.6M | $-273.7M |
| Share Buybacks | $21.1M | $9.9M | $2.9M |
| Dividends Paid | $34.6M | $34.4M | $35.1M |
| Cash from Financing | $-56.2M | $-45.2M | $-43.6M |
| FX Effect | $0 | $0 | $0 |
| Net Change in Cash | $96.9M | $102.7M | $-116.0M |
| Beginning Cash | $126.4M | $223.3M | $326.0M |
| Ending Cash | $223.3M | $326.0M | $210.0M |
Frequently Asked Questions
How does RPC INC make money?
Automotive Components delivering under-the-hood and interior parts; Industrial Products supplying custom injection molded solutions for machinery; Consumer Goods manufacturing durable household items and packaging; Specialized Polymers producing high-value technical materials for niche applications.
What are the main risks for RES?
Significant exposure to cyclical automotive demand fluctuations impacting revenue stability and margin compression; Rising raw material costs for resins and energy affecting operating expenses and gross margins; Intense global competition from lower-cost manufacturing hubs pressuring pricing power and market share.
What is RES's competitive advantage?
Deep global footprint with strategic manufacturing sites providing supply chain resilience against geopolitical disruptions; Proprietary polymer formulations enabling superior product performance and cost efficiency for top-tier automotive OEMs; Strong customer retention driven by long-term design-in relationships and rapid prototyping capabilities.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.