Analysis:
Part 1: Performance Analysis
Ranger Energy Services, Inc. had a year of significant business developments, including acquisitions and integrations, which focused on enhancing its performance. The acquisitions of Basic, PerfX, and Patriot expanded the scale and scope of its wireline services segment and high specification rigs and processing solutions and ancillary service segments. Additionally, the company reported progress in its fight against COVID-19, with significant developments being made to contain its multiple variants.
Despite these positive developments, the company reported identified material weaknesses in its internal control over financial reporting, which comprise of deficiencies that need to be remedied. The weaknesses included inadequate controls over segregation of duties related to the review and creation of manual journal entries and account reconciliations, inadequate controls over administrative user access to the company's information system, and ineffective controls over the accounting for complex transactions.
Part 2: Forward-Looking Analysis
Looking ahead, the company's performance is likely to depend significantly on the severity, duration, and spread of COVID-19 and its variants. Any significant developments concerning the disease may have a material impact on Ranger Energy Services, Inc.'s financial performance. Therefore, the company may find itself at risk of failing to meet its financial obligations if developments related to COVID-19 negatively impact its operational and financial performance.
Furthermore, the weaknesses identified in the company's internal control over financial reporting need to be remediated to avoid errors in financial statements and meet its reporting obligations. The company has initiated changes through remediation plans to overcome these weaknesses, as well as enhancing processes and designing additional internal controls.
In conclusion, the integration of acquisitions and focus on performance helped Ranger Energy Services, Inc. in yielding positive results, but the risk posed by uncertainties related to COVID-19 and the weakness identified in internal controls over financial reporting requires urgent attention to prevent an adverse impact on the company's future performance.