CJ 2017 Annual Report

We are actively monitoring the market and managing our business in line with demand for services, and we will make adjustments to our strategy as necessary to effectively respond to changes in market conditions. We are taking a measured approach to asset deployment, balancing our view of customer demand with an acute focus on generating positive returns for our shareholders. Our top priorities remain to drive revenue by maximizing utilization, to improve margins through cost control, and to protect and grow market share by focusing on the quality and efficiency of our service execution and ensuring that we are strategically positioned to capitalize on future market improvement. Please see “Liquidity and Capital Resources” in this Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in addition to “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in Part I, Item 1A of this Annual Report. 46 Results of Operations As a result of our emergence from the Chapter 11 Proceeding, the 2017 financial results have been separately presented under the label "Successor" for the year ended December 31, 2017. The results for the Predecessor on January 1, 2017 reflect solely the impact of the application of fresh start accounting on that date and are therefore not included in the discussion of results of operations below. The following is a comparison of our results of operations for the year ended December 31, 2017, compared to the year ended December 31, 2016, and a comparison of our results of operations for the year ended December 31, 2016, compared to the year ended December 31, 2015. Our results for the 2017 and 2016 years include the financial and operating results of the businesses acquired in the Nabors Merger for the entire period. Our results for the 2015 year include the financial and operating results of the businesses acquired in the Nabors Merger for the partial period beginning March 24, 2015 (the "Merger Effective Time") through December 31, 2015. Accordingly, comparisons of the 2016 results to prior year 2015 results may not be meaningful. Results for the Year Ended December 31, 2017 Compared to the Year Ended December 31, 2016 The following table summarizes the change in our results of operations for the year ended December 31, 2017, compared to the year ended December 31, 2016 (in thousands):