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Calyon Energy Forum 2009. May 13, 2009. Forward-Looking Statements. - PowerPoint PPT Presentation
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Calyon Energy Forum 2009 May 13, 2009
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Page 1: Calyon Energy Forum 2009

Calyon Energy Forum 2009

May 13, 2009

Page 2: Calyon Energy Forum 2009

2

Forward-Looking Statements

Some of the things we will discuss today relative to our views on future company performance and results, and other statements not dealing with historical facts, will be forward-looking statements within the meaning of U.S. securities laws. The company cautions that actual results may differ materially from those discussed in these forward-looking statements. You should refer to the additional information contained in our filings with the SEC about the risks and uncertainties that could cause actual results to be different than those contemplated in this discussion. The company’s SEC filings can be viewed at www.bakerhughes.com.

Reconciliation of non GAAP measures referenced in today’s presentation can be found on our website www.bakerhughes.com in the Investor Relations section.

Page 3: Calyon Energy Forum 2009

First Quarter Results North America

– $1.08 B – Revenue down 8% y/y, down 23%

seq– Operating profit margin – 12.1%

Adj. operating profit margin1 - 15.6%

1 Excluding severance costs and allowance for doubtful accounts1 Excluding severance costs and allowance for doubtful accounts

Page 4: Calyon Energy Forum 2009

0

500

1000

1500

2000

2500

3000

3500

4000

4500

5000

Jan

70

Jan

72

Jan

74

Jan

76

Jan

78

Jan

80

Jan

82

Jan

84

Jan

86

Jan

88

Jan

90

Jan

92

Jan

94

Jan

96

Jan

98

Jan

00

Jan

02

Jan

04

Jan

06

Jan

08

-54.3%

-42.9%

-52.7%

-49.4%

-37.6%

-65.6%

-70.0%

-60.0%

-50.0%

-40.0%

-30.0%

-20.0%

-10.0%

0.0%1 5 9 13 17 21 25 29 33 37 41 45 49 53 57 61 65 69 73 77 81 85

-1103

-555-544

-583

-444

-1298

-1400

-1200

-1000

-800

-600

-400

-200

0

1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52 55 58 61 64 67 70 73 76 79 82 85 88

4

This US Cycle Compared to Past Cycles

Rigs Lost

% Loss f/ Peak

2008-2009

1997-1999

2001-2002

1990-19921987-1989

*Updated 5/8/09

weeks from peak

•weeks from peak

1986

Rigs

Page 5: Calyon Energy Forum 2009

US Total

900100011001200130014001500160017001800190020002100

Jan

07

Apr

07

Jul 0

7

Oct

07

Jan

08

Apr

08

Jul 0

8

Oct

08

Jan

09

Apr

09

Gas

500

700

900

1100

1300

1500

1700

Jan

07

Apr

07

Jul 0

7

Oct

07

Jan

08

Apr

08

Jul 0

8

Oct

08

Jan

09

Apr

09

Horizontal

0100200300400500600700800900

1000

Jan

07

Apr

07

Jul 0

7

Oct

07

Jan

08

Apr

08

Jul 0

8

Oct

08

Jan

09

Apr

09

Oil

0100200300400500600700800900

1000

Jan

07

Apr

07

Jul 0

7

Oct

07

Jan

08

Apr

08

Jul 0

8

Oct

08

Jan

09

Apr

09

Vertical

100200300400500600700800900

10001100

Jan

07

Apr

07

Jul 0

7

Oct

07

Jan

08

Apr

08

Jul 0

8

Oct

08

Jan

09

Apr

09

Directional

0100200300400500600700800900

1000

Jan

07

Apr

07

Jul 0

7

Oct

07

Jan

08

Apr

08

Jul 0

8

Oct

08

Jan

09

Apr

09

5

US Rig Count 2007 to Date*

-54.3%from 2031 on 9/12

-54.5%from 1606 on 9/12

-54.0%from 9/12

-57.0% from 442 on 11/7

-40.4%from 9/12

-41.5% from 650 on 10/31

-58.8%from 9/12

-59.4% from 404 on 9/19

-61.4%from 9/12

-62.2% from 1017 on 8/29

*Updated 5/8/09

Rigs

Page 6: Calyon Energy Forum 2009

1651

1000

1500

2000

2500

3000

3500

4000

1 11 21

31

41

51

Bc

f

Week

2009

Average

5 Yr. High

5 Yr. Low

US Natural Gas Inventory and LNG

1,919 Bcf in storage

34% above last year’s 1,436 Bcf

Source: Bloomberg, EIA (DOE), Waterbourne LNG Report

6 Macroeconomics – Gas

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

Jan

-04

Jul-

04

Jan

05

Jul 0

5

Jan

06

Jul 0

6

Jan

07

July

07

Jan

08

Jul 0

8

Jan

09

Imp

ort

s (B

CF

/da

y)

LNG Imports

Waterbourne Forecast

Page 7: Calyon Energy Forum 2009

First Quarter Results North America

– $1.08 B – Revenue down 8% y/y, down 23%

seq– Operating profit margin – 12.1%

Adj. operating profit margin1 - 15.6%

Latin America Revenue– $288 MM – Revenue up 23% y/y, down 15% seq– Operating profit margin 8.8%

Adj. operating profit margin1 – 15.1%

Europe / Africa / Russia & Caspian – $776 MM– Revenue up 2% y/y, down 8% seq– Operating profit margin – 19.4%

Adj. operating profit margin1 – 21.9%

Middle East / Asia Pacific – $521 MM– Revenue up 5% y/y, down 12% seq– Operating profit margin – 14.0%

Adj. operating profit margin1 – 15.2%

1 Excluding severance costs and allowance for doubtful accounts1 Excluding severance costs and allowance for doubtful accounts

Page 8: Calyon Energy Forum 2009

500

600

700

800

900

1000

1100

1200

Jan

91

Jan

92

Jan

93

Jan

94

Jan

95

Jan

96

Jan

97

Jan

98

Jan

99

Jan

00

Jan

01

Jan

02

Jan

03

Jan

04

Jan

05

Jan

06

Jan

07

Jan

08

Jan

09

-238

-270

-122

-300

-250

-200

-150

-100

-50

01 2 3 4 5 6 7 8 9 10111213141516171819202122232425262728293031323334

-25%

-33%

-11%

-35%

-30%

-25%

-20%

-15%

-10%

-5%

0%1 2 3 4 5 6 7 8 9 10111213141516171819202122232425262728293031323334

This Int’l Cycle Compared to Past Cycles

Rigs Lost

% Loss from Peak

2008-2009

1997-1999

1990-1992

months from peak

months from peak

Source: Baker Hughes – May 2009

8 Rigs

Page 9: Calyon Energy Forum 2009

Exiting the Downturn A Stronger Company Reducing the size of our workforce

– $250 million annual savings– Achieve run-rate by Q309

Efficiencies in Shared services organizations– $50 million in 2010

Closed and Consolidate Facilities Strengthened Balance Sheet Added Key Executives

– Supply Chain– Information Technology– Reliability

Geographic Organization

9

Page 10: Calyon Energy Forum 2009

Regions and Geomarkets

10

CalgaryCalgary

HoustonHouston

Rio de JaneiroRio de Janeiro

ParisParisLondonLondon

DubaiDubai

Kuala LumpurKuala Lumpur

MoscowMoscow

Mexico CityMexico City

BogotaBogota

CaracasCaracas

Buenos AiresBuenos AiresCape TownCape Town

LagosLagos

LuandaLuanda

BeijingBeijing

AberdeenAberdeen

PerthPerth

StavangerStavanger

CairoCairo

TripoliTripoli

AlgiersAlgiers

MilanMilanAlmatyAlmaty

JakartaJakarta

MumbaiMumbai

DhahranDhahran

Page 11: Calyon Energy Forum 2009

11

New Organization

Peter RagaussSr. VP & CFO

Peter RagaussSr. VP & CFO Russ Cancilla

VP, HSE&S

Russ CancillaVP, HSE&S

Didier CharretonVP, HR

Didier CharretonVP, HR

Martin CraigheadSr VP & COO

Martin CraigheadSr VP & COO

Alan CrainVP, General Counsel

Alan CrainVP, General Counsel

Chad DeatonChairman, President &

CEO

Chad DeatonChairman, President &

CEO

Belgacem ChiraigPresident,

Eastern Hemisphere

Belgacem ChiraigPresident,

Eastern Hemisphere

Andy O’Donnell,President

Western Hemisphere

Andy O’Donnell,President

Western Hemisphere

Nathan MeehanVP ReservoirTechnology

Nathan MeehanVP ReservoirTechnology

Derek MathiesonPresident

Products and Technology

Derek MathiesonPresident

Products and Technology

Clif TripletVP Information

Technology

Clif TripletVP Information

Technology

Art SoucyVP Supply Chain

Art SoucyVP Supply Chain

Page 12: Calyon Energy Forum 2009

$478

$922

$1,127

$1,300

$1,100

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

'05

'06

'07

'08

'09

$300

$339$372

$426$433

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

$500

'05

'06

'07

'08

'09

Technology Spend

BHI R&E Spend ($ Mlns)BHI R&E Spend ($ Mlns) BHI Capex and DD&A ($ Mlns)BHI Capex and DD&A ($ Mlns)

Source: BHI, Public Filings

Page 13: Calyon Energy Forum 2009

13


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