Baker Hughes Provides Corrected Regional Financial Information

HOUSTON, July 18, 2008 /PRNewswire via COMTEX/ -- BHI | Quote | Chart | News | PowerRating -- Baker Hughes Incorporated (NYSE: BHI | Quote | Chart | News | PowerRating) today is providing corrected information for regional operating profit before tax for its Middle East Asia Pacific (MEAP) and Europe, Africa, Russia, Caspian (EARC) regions for the thirteen quarters from the quarter ending March 31, 2005 through the quarter ended March 31, 2008 and is identified on the attached schedules as "(Corrected)". The original data was released on July 8, 2008.

The corrected disclosure reflects an increase in operating profit for the MEAP region which exactly offsets the decrease in operating profit for the EARC region in each quarter. There were no changes to any other previously disclosed information. The corrected 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 Corrected July 18, 2008 12 months 3 months ended 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 (Corrected) 73.3 86.6 92.2 97.9 350.0 Middle East, Asia Pacific (Corrected) 45.5 61.3 68.2 80.0 255.0 ------------------------------------------------------------------------- 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 (18.6) (16.7) (18.8) (18.2) (72.3) Interest and dividend income 1.9 3.3 4.9 7.9 18.0 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 Corrected July 18, 2008 12 months 3 months ended 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 (Corrected) 116.4 129.3 142.5 148.9 537.1 Middle East, Asia Pacific (Corrected) 77.7 102.0 96.9 120.8 397.4 ------------------------------------------------------------------------- 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 Corrected July 18, 2008 12 months 3 months ended 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 (Corrected) 157.2 179.3 170.6 178.3 685.4 Middle East, Asia Pacific (Corrected) 106.9 108.7 114.7 140.1 470.4 ------------------------------------------------------------------------- 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 Corrected July 18, 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 (Corrected) 149.3 Middle East, Asia Pacific (Corrected) 101.6 ----------------------------------- 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 and other (63.9) ----------------------------------- Corporate, net interest and other (43.4) ----------------------------------- 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 ------------------------------------------------------------------------- UNAUDITED for the three for the twelve (In millions except earnings months ended months ended 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 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

http://www.bakerhughes.com

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