CJ 2017 Annual Report

service during the first quarter as customers continue to increase completion activity and we continue to seek to align ourselves with our most efficient customers with competitive pricing. In our cementing business, we expect to focus on increasing utilization by fully integrating the O-Tex asset base and redeploying warm stacked units at market pricing. We expect the majority of asset redeployment and improvement in utilization to occur in West Texas where demand remains strong, but we anticipate gradual improvement in our other core operating basins by the end of the first quarter as the chance for potential disruptions caused by inclement weather decreases. We ordered two large diameter, meaning two inches or larger in diameter, new-build coiled tubing units to meet strong demand from multiple customers, which are expected to be deployed to customers early in the second quarter of 2018. With the arrival of these new units combined with strengthening market conditions, we expect to continue with our strategy of dedicating additional units to our most active customers at elevated utilization levels and market pricing. We have and expect to continue to experience increases in activity and pricing in all of our core operating basins. Well Support Services Our Well Support Services segment focuses on post-completion activities at the well site, including rig services, such as workover and plug and abandonment, fluids management, and special services, including artificial lift applications and other specialty well site services. The majority of revenue for this segment is generated by our rig services business, and we consider rig services and fluids management to be our core businesses within this segment. During the fourth quarter of 2017, our rig services business deployed, on average, approximately 121 workover rigs per workday out of our average fleet of approximately 400 marketable workover rigs. In our fluids management business, we deployed, on average, approximately 628 fluid services trucks per workday and approximately 1,114 frac tanks per workday out of our estimated average fleets of approximately 1,087 trucks and 3,744 frac tanks, respectively. In our fluids management business, we own 25 private salt water disposal wells for fluids disposal purposes. However, our deployed assets may not be utilized fully, or at all, at any given time, due to, among other things, routine scheduled maintenance and downtime. Additionally, in response to the continued competitive landscape, we have continued to focus on operational rightsizing measures to better align these businesses with current market conditions, which has included closing facilities and idling unproductive equipment. Management evaluates the operation and performance of our Well Support Services segment and allocates resources primarily based on activity levels, specifically rig and trucking hours, as well as Adjusted EBITDA. The following table presents rig and trucking hours for our Well Support Services for the years ended December 31, 2017 and 2016 (in thousands): Successor Predecessor Year Ended December 31, 2017 2016 Revenue Rig Services $ 218,819 $ 197,003 Fluids Management Services 122,949 132,486 Other Well Support Services (includes ESPCT) 40,460 34,279 Total revenue $ 382,228 $ 363,768 Adjusted EBITDA $ 9,233 $ 19,456 Average active workover rigs 188 197 Total workover rig hours 452,948 429,727 Average fluids management trucks 1,107 1,411 Average active fluids management trucks 638 725 Total fluids management truck hours 1,281,024 1,384,897 41