Baker Hughes Discloses Prior Period Regional Revenue and Operating Results

HOUSTON, July 8 /PRNewswire/ -- As previously announced, Baker Hughes Incorporated (NYSE: BHI) today disclosed historical revenue by region and operating profit before tax by region for thirteen quarters from the quarter ending March 31, 2005 through the quarter ended March 31, 2008. In the future the company will disclose revenue and operating profit before tax for its two operating segments -- Drilling and Evaluation and Completion and Production, as well as for its four geographic regions -- North America, Latin America, Europe Africa Russia and the Caspian and Middle East, Asia Pacific.

Revenue is based on the geographic region which provides operational support associated with the revenue and differs by an immaterial amount from the previously disclosed region revenue which was based on the ultimate destination of the products or services sold. This information is also posted on our website at http://www.bakerhughes.com/investor.



             Revenue and Operating Profit Before Tax(1) by Region
                  For the 12 Months ended December 31, 2005

                                 3 months ended                    12 months
                                                                     ended
                   3/31/2005   6/30/2005   9/30/2005  12/31/2005   12/31/2005
    --------------------------------------------------------------------------
    Segment Revenue
      Drilling and
       Evaluation      $839.3     $893.7    $915.0    $1,046.2      $3,694.2
      Completion and
       Production       803.2      873.8     869.8       943.2       3,490.0
    -------------------------------------------------------------------------
    Oilfield
     Operations       1,642.5    1,767.5   1,784.8     1,989.4       7,184.2
    =========================================================================

    Geographic Revenue
      North America     716.8      751.6     762.4       845.1       3,075.9
      Latin America     155.3      175.8     177.8       194.6         703.5
      Europe, Africa,
       Russia, and
       the Caspian      463.6      496.3     499.2       547.5       2,006.6
      Middle East,
       Asia Pacific     306.8      343.8     345.4       402.2       1,398.2
    -------------------------------------------------------------------------
    Oilfield
     Operations       1,642.5    1,767.5   1,784.8     1,989.4       7,184.2

    Corporate and Other
    Corporate and
     other revenue        0.4        0.9       -           -             1.3
    --------------------------------------------------------------------------
    Total revenues   $1,642.9   $1,768.4  $1,784.8    $1,989.4      $7,185.5
    ==========================================================================

    Segment Operating
     Profit
      Drilling and
       Evaluation      $153.3     $174.2    $190.0      $232.1       $749.6
      Completion and
       Production(2)    146.3      171.3     170.0       178.4        666.0
    --------------------------------------------------------------------------
      Oilfield
       Operations       299.6      345.5     360.0       410.5      1,415.6
    ==========================================================================

    Geographic Operating
     Profit
      North America     148.8      157.0     167.4       194.9        668.1
      Latin America      32.0       40.6      32.2        37.7        142.5
      Europe, Africa,
       Russia, and
       the  Caspian      79.0       92.1      95.6       103.5        370.2
      Middle East,
       Asia Pacific      39.8       55.8      64.8        74.4        234.8
    -------------------------------------------------------------------------
    Oilfield
     Operations         299.6      345.5     360.0       410.5      1,415.6
    -------------------------------------------------------------------------
      WesternGeco        19.3       18.5      25.5        33.4         96.7
    --------------------------------------------------------------------------
    Total Oilfield      318.9      364.0     385.5       443.9      1,512.3

    Corporate and
     Other Operating
     Profit
    Interest expense    (21.2)     (16.7)    (18.8)      (18.2)      (74.9)
    Interest and
     dividend income      4.5        3.3       4.9         7.9        20.6

    Corporate and
     other              (32.0)     (45.2)    (49.2)      (52.4)     (178.8)
     -------------------------------------------------------------------------
    Corporate, net
     interest and
     other              (48.7)     (58.6)    (63.1)      (62.7)     (233.1)
     -------------------------------------------------------------------------
    Total Operating
     Profit(1)         $270.2     $305.4    $322.4      $381.2    $1,279.2
    =========================================================================

See "Notes to Revenue and Operating Profit Before Tax by Region" in this news release.



             Revenue and Operating Profit Before Tax(1) by Region
                  For the 12 Months ended December 31, 2006

                                    3 months ended                  12 months
                                                                      ended
                   3/31/2006  6/30/2006(1)  9/30/2006  12/31/2006   12/31/2006
    --------------------------------------------------------------------------
    Segment Revenue
     Drilling and
      Evaluation     $1,084.5    $1,118.4  $1,204.1    $1,253.7     $4,660.7
     Completion
      and Production    977.5     1,084.9   1,105.3     1,199.0      4,366.7
    -------------------------------------------------------------------------
    Oilfield
     Operations       2,062.0     2,203.3   2,309.4     2,452.7      9,027.4
    --------------------------------------------------------------------------

    Geographic Revenue
     North America      946.7       979.3   1,044.1     1,047.2      4,017.3
     Latin America      181.6       197.7     204.6       226.0        809.9
     Europe, Africa,
      Russia, and
      the Caspian       557.1       605.4     637.9       689.2      2,489.6
     Middle East,
      Asia Pacific      376.6       420.9     422.8       490.3      1,710.6
    --------------------------------------------------------------------------
    Oilfield
     Operations       2,062.0     2,203.3   2,309.4     2,452.7      9,027.4

    Corporate and Other
    Corporate and
     other revenue        -           -         -           -            -
    --------------------------------------------------------------------------
    Total revenues   $2,062.0    $2,203.3  $2,309.4    $2,452.7     $9,027.4
    ==========================================================================


    Segment Operating
     Profit
     Drilling and
      Evaluation(4)    $277.3      $288.0    $320.7      $355.8     $1,241.8
     Completion and
      Production        204.8       246.3     241.1       249.7        941.9
    --------------------------------------------------------------------------
     Oilfield
      Operations        482.1       534.3     561.8       605.5      2,183.7
    ==========================================================================

    Geographic Operating
     Profit
     North America      254.2       262.5     282.2       288.5      1,087.4
     Latin America       33.8        40.5      40.2        47.3        161.8
     Europe, Africa,
      Russia, and
      the Caspian       125.3       140.2     156.1       159.4        581.0
     Middle East,
      Asia Pacific       68.8        91.1      83.3       110.3        353.5
    --------------------------------------------------------------------------
     Oilfield
      Operations        482.1       534.3     561.8       605.5      2,183.7

     WesternGeco(3)      47.9        10.8       -           -           58.7
    --------------------------------------------------------------------------
    Total Oilfield      530.0       545.1     561.8       605.5      2,242.4

    Corporate and Other
     Operating Profit
    Interest expense    (16.5)      (17.0)    (18.1)      (17.3)       (68.9)
    Interest and
     dividend income      7.3        24.2      22.6        13.4         67.5
    Charge for
     investigation
     resolution(5)                                        (46.1)       (46.1)
    Corporate and
     other              (41.4)      (45.3)    (49.0)      (65.9)      (201.6)
    --------------------------------------------------------------------------
    Corporate, net
     interest and
     other              (50.6)      (38.1)    (44.5)     (115.9)      (249.1)
    --------------------------------------------------------------------------
    Total Operating
     Profit(1)         $479.4      $507.0    $517.3      $489.6     $1,993.3
    ==========================================================================

See "Notes to Revenue and Operating Profit Before Tax by Region" in this news release.



             Revenue and Operating Profit Before Tax(1) by Region
                  For the 12 Months ended December 31, 2007

                                      3 months ended                12 months
                                                                      ended
                     3/31/2007   6/30/2007   9/30/2007  12/31/2007  12/31/2007
    --------------------------------------------------------------------------
    Segment Revenue
     Drilling and
      Evaluation(5)   $1,288.5    $1,278.7    $1,356.0   $1,370.0   $5,293.2
     Completion and
      Production       1,184.2     1,258.7     1,321.8    1,370.3    5,135.0
    --------------------------------------------------------------------------
    Oilfield
     Operations        2,472.7     2,537.4     2,677.8    2,740.3   10,428.2
    ==========================================================================

    Geographic Revenue
     North America     1,073.8     1,055.8     1,124.7    1,117.0    4,371.3
     Latin America       228.0       232.1       256.3      256.0      972.4
     Europe, Africa,
      Russia, and
      the Caspian        709.2       765.0       799.1      803.0    3,076.3
     Middle East,
      Asia Pacific       461.7       484.5       497.7      564.3    2,008.2
    --------------------------------------------------------------------------
     Oilfield
      Operations       2,472.7     2,537.4     2,677.8    2,740.3   10,428.2

    Corporate and Other

    Corporate and
     other revenue         0.1         0.1        (0.2)       -         -
    --------------------------------------------------------------------------
    Total revenues    $2,472.8    $2,537.5    $2,677.6   $2,740.3 $10,428.2
    ==========================================================================


    Segment Operating Profit
     Drilling and
      Evaluation(6)     $365.1      $326.6      $357.1     $347.4  $1,396.2
     Completion and
      Production         245.0       265.2       287.2      314.8   1,112.2
    --------------------------------------------------------------------------
     Oilfield
      Operations         610.1       591.8       644.3      662.2   2,508.4
    ==========================================================================
    Geographic Operating
    Profit
     North America       301.1       264.2       305.1      285.6   1,156.0
     Latin America        44.9        39.6        53.9       58.2     196.6
     Europe, Africa,
      Russia, and
      the Caspian        168.7       192.1       185.7      190.8     737.3
     Middle East,
      Asia Pacific        95.4        95.9        99.6      127.6     418.5
    --------------------------------------------------------------------------
     Oilfield
      Operations         610.1       591.8       644.3      662.2   2,508.4

    Corporate and Other
     Operating Profit
     Interest expense    (16.8)      (16.2)      (16.7)     (16.4)    (66.1)
     Interest and
      dividend income     11.5        10.7        10.5       11.1      43.8
     Corporate and
      other              (49.7)      (54.5)      (61.7)     (63.5)   (229.4)
    --------------------------------------------------------------------------
     Corporate, net
      interest and
      other              (55.0)      (60.0)      (67.9)     (68.8)   (251.7)
    --------------------------------------------------------------------------
    Total Operating
     Profit(1)          $555.1      $531.8      $576.4     $593.4  $2,256.7
    ==========================================================================

See "Notes to Revenue and Operating Profit Before Tax by Region" in this news release.



             Revenue and Operating Profit Before Tax(1) by Region
                    For the 3 Months ended March 31, 2008

                                                   3 months
                                                     ended
                                                   3/31/2008
    ---------------------------------------------------------
    Segment Revenue
     Drilling and Evaluation                        $1,390.9
     Completion and Production                       1,279.5
    ---------------------------------------------------------
    Oilfield Operations                              2,670.4
    =========================================================
    Geographic Revenue
     North America                                   1,161.6
     Latin America                                     250.0
     Europe, Africa, Russia, and the Caspian           762.4
     Middle East, Asia Pacific                         496.4
    ---------------------------------------------------------
    Oilfield Operations                              2,670.4

    Corporate and Other
    Corporate and other revenue                          -
    ---------------------------------------------------------
    Total revenues                                  $2,670.4
    =========================================================


    Segment Operating Profit
     Drilling and Evaluation                          $349.5
     Completion and Production                         263.1
    ---------------------------------------------------------
     Oilfield Operations                               612.6
    =========================================================


    Geographic Operating
    Profit
     North America                                     311.7
     Latin America                                      50.0
     Europe, Africa, Russia, and the Caspian           161.5
     Middle East, Asia Pacific                          89.4
     --------------------------------------------------------
    Oilfield Operations                                612.6


    Corporate and Other Operating Profit
    Gain on sale of product line(7)                     28.2
    Interest expense                                   (15.7)
    Interest and dividend income                         8.0
    Corporate, net interest and other                  (63.9)
    ---------------------------------------------------------
    Total Operating Profit(1)                         $569.2
    =========================================================


See "Notes to Revenue and Operating Profit Before Tax by Region" in this news release.

Notes to Revenue and Operating Profit Before Tax by Region

1 - Operating profit before tax is a non-GAAP measures comprised of income from continuing operations excluding the impact of certain identified non- operational items. The company believes that operating profit is useful to investors because it is a consistent measure of the underlying results of the company's business. Furthermore, management uses operating profit internally as a measure of the performance of the company's operations. Income from continuing operations before tax is reconciled to operating profit before tax in the table below. Reconciliation of GAAP and operating profits for historical periods can be found on the company's website at http://www.bakerhughes.com/investor.



    Reconciliation of GAAP and Operating Profit Before Tax
    --------------------------------------------------------------------------
                                              for the three   for the twelve
    UNAUDITED                                 months ended     months ended
    (In millions except earnings per share)   June 30, 2006  December 31, 2006
    --------------------------------------------------------------------------
    Income from continuing operations (GAAP)    $2,250.5        $3,736.8
    Less non-operational items:
      Gain on sale of interest in WesternGeco   (1,743.5)       (1,743.5)
    --------------------------------------------------------------------------
    Operating results, excluding the impact
     of Non-operational items                     $507.0        $1,993.3
    ==========================================================================

The non-operational item in the second quarter of 2006 and the year ended December 31, 2006 related to the pre-tax gain of $1,743.5 million ($1,035.2 million after tax) from the sale of our 30% interest in WesternGeco, our seismic joint venture with Schlumberger, to Schlumberger on April 28, 2006 for $2.4 billion in cash.

There were no non-operational items in any other period between Quarter 1 2005 and Quarter 1 2008.

2 - Quarter 4 2005 results for Completion and Production include a $5.1 million write-off of in-process research and development associated with the acquisition of the remaining interest in QuantX. The impact on the region operating profit was: North America: $2.1 million; Europe Africa Russia and the Caspian: $3.0 million.

3 - Our 30% minority interest in WesternGeco was sold to Schlumberger on April 28, 2006.

4 - Fourth quarter 2006 results were favorably impacted by a change in accounting procedures related to certain inventory of our Baker Atlas division. The pretax impact of this change was a $21.2 million reduction to cost of services and rentals. The full amount is reflected in Drilling and Evaluation operating profit. The impact on the region operating profit was: North America: $7.5 million; Latin America: $2.6 million; Europe Africa Russia and the Caspian: $6.4 million; Middle East, Asia Pacific: $4.7 million.

5 - Fourth quarter 2006 results included a financial charge of approximately $46 million before tax ($38.5 million after tax or approximately $0.12 per diluted share) associated with the likely resolution of the investigations by the Securities and Exchange Commission and Department of Justice into activities in Angola, Kazakhstan and Nigeria.

6 - 2007 results were favorably impacted by an increase in the depreciable lives of certain assets of our Baker Atlas division. The pretax impact of this change was approximately $6.0 million reduction to cost of services and rentals per quarter.

7 - Profit before tax includes a gain of $28.2 million (approximately $18.4 million after tax or $0.06 per diluted share) for the gain on the sale of the Completion and Production segment's Surface Safety Systems ("SSS") product line in February 2008.


       Baker Hughes provides reservoir consulting, drilling, formation
      evaluation, completion and production products and services to the
                       worldwide oil and gas industry.

     Contact:
     Gary R. Flaharty (713) 439-8039
     H. Gene Shiels (713) 439-8822

SOURCE Baker Hughes Incorporated

Web site: http://www.bakerhughes.com