June 2008 -- Full-year profit for oil and gas products and field service provider Baker Hughes Inc. dropped
37%, but the company has reason for optimism judging from its fourth-quarter performance. Net
income for the year-end quarter was $400.5 million, or $1.26 per share, compared with $326.2
million, or $1.02 per share, during the year-earlier period.
For the year, profit was $1.5 billion, or $4.73 per share, compared with $2.4 billion, or $7.27
per share, in 2006. Revenue in fiscal 2007 totaled $10.4 billion, up 16% from the previous year.
Revenue from North America increased 9%, and revenue from outside North America increased 21%.
"Our completion and production segment reported good results with strong incremental margins in
the fourth quarter," said Baker Hughes Chairman and CEO Chad Deaton when the results were
announced. "Baker Petrolite and Centrilift benefited from their greater exposure to production-
oriented expenditures, despite a softer than expected North American market and Baker Oil Tools
had a strong quarter, particularly in the Eastern Hemisphere. Our drilling and evaluation
segment reported decreased profits as lower than expected activity in the Gulf of Mexico, a more
competitive market in North America, and a labor disruption in Algeria affected results."
Deaton adds that growing energy demands should present a positive outlook for the company.
"For the foreseeable future, the world will need more hydrocarbons to satisfy its growing energy
demand, and oil and gas companies will work to fill that need by increasing their spending on
exploration, development and production," he says.
