Ranger Energy Services Inc (NYSE:RNGR) Q3 2019 Earnings Conference Call - Final Transcript
Oct 25, 2019 • 10:00 am ET
Good morning, and welcome to the Ranger Energy Third Quarter 2019 Conference Call. [Operator Instructions]
I would now like to turn the conference over to Darron Anderson, Chief Executive Officer. Please go ahead.
Darron M. Anderson
Thank you, operator. Good morning, and welcome to Ranger Energy Services' Third Quarter 2019 Earnings Conference Call. Joining me today is Brandon Blossman, our CFO, who will offer his comments in a moment.
This morning, I'm not going to dwell on the challenging macro backdrop, budget exhaustion or even the hope of an early 2020 E&P budget reload, as these are all factors well outside of our control. Instead, I will focus more on what we at Ranger do have control of, what we've accomplished to-date, where we continue to spend our effort and what we hope to accomplish in the coming quarters.
With the close of third quarter, here's what we've accomplished: first, cash flow and net debt reduction. During the third quarter, we produced cash flow from operations of $22 million and reduced net debt by $17 million. Our continued operational performance, resolving one-time working capital issues and minimal maintenance capex spend required by our high-quality asset base, all led to the significant cash generation that we expected to deliver across 2019.
Second, our Wireline is back on track. Last quarter, we spent some time talking about our Wireline business, we particularly made the decision to reposition a core set of assets from one customer to another. While this decision did have a material negative impact to our Q2 results, we are pleased with the decision and note that for Q3, our fleet utilization is back to the highs of early 2019.
Next, high grading our High-Spec Rig customer base. We continue to leverage our young fleet, improving systems and streamline processes to deliver high-quality work to customers who are willing to value these attributes. In line with this objective, this quarter, we are announcing an additional global integrated new customer contract. While this new contract was a great win for us for the quarter, our Q3 High-Spec Rigs were negatively impacted by one-time costs associated with preparing several rigs for this contract and other existing top-tier customers. This expense and associated capital investment taken in the quarter will pay material dividends in the future.
Other Services. An area of underperformance in our quarter was within our other services outside the Wireline. Here, we saw a decline in activity in one particular service line. However, during the quarter, we completed a full restructuring of the service offering to better align our cost structure with a near-term expected revenue stream. And finally, our Processing Solution. This segment delivered solid performance, producing their best quarter of 2019. Here, increased revenue and EBITDA on incremental gas cooler deployments, higher mechanical refrigerated -- refrigeration unit pricing and increased mobilization -- demobilization revenue were partially offset by lower MRU utilization.
Now to give you a little more detail on the quarter. Total revenue for the quarter was nearly unchanged rounded to