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Note฀13.฀Segment฀and฀Related฀Information
We฀operate฀through฀seven฀divisions฀–฀Baker฀Atlas,฀Baker฀
Hughes฀Drilling฀Fluids,฀Baker฀Oil฀Tools,฀Baker฀Petrolite,฀Centri-
lift,฀Hughes฀Christensen฀and฀INTEQ฀–฀that฀we฀have฀aggregated฀
into฀the฀Oilfield฀segment฀because฀they฀have฀similar฀economic฀
characteristics฀and฀because฀the฀long-term฀financial฀perfor-
mance฀of฀these฀divisions฀is฀affected฀by฀similar฀economic฀condi-
tions.฀The฀consolidated฀results฀are฀evaluated฀regularly฀by฀our฀
chief฀operating฀decision฀maker฀in฀deciding฀how฀to฀allocate฀
resources฀and฀in฀assessing฀performance.
These฀operating฀divisions฀manufacture฀and฀sell฀products฀
and฀provide฀services฀used฀in฀the฀oil฀and฀natural฀gas฀exploration฀
industry,฀including฀drilling,฀formation฀evaluation,฀completion฀
and฀production฀of฀oil฀and฀natural฀gas฀wells.฀They฀operate฀in฀
the฀same฀markets,฀which฀includes฀all฀of฀the฀major฀oil฀and฀nat-
ural฀gas฀producing฀regions฀of฀the฀world:฀฀North฀America,฀
South฀America,฀Europe,฀Africa,฀the฀Middle฀East฀and฀the฀Far฀
East.฀They฀also฀have฀substantially฀the฀same฀customers,฀which฀
includes฀major฀multi-national,฀independent฀and฀state-owned฀
oil฀companies.฀The฀Oilfield฀segment฀also฀includes฀our฀30%฀
interest฀in฀WesternGeco฀and฀other฀investments฀in฀affiliates.
The฀accounting฀policies฀of฀the฀Oilfield฀segment฀are฀the฀
same฀as฀those฀described฀in฀Note฀1฀of฀Notes฀to฀Consolidated฀
Financial฀Statements.฀We฀evaluate฀the฀performance฀of฀the฀Oil-
field฀segment฀based฀on฀segment฀profit฀(loss),฀which฀is฀defined฀
as฀income฀from฀continuing฀operations฀before฀income฀taxes,฀
accounting฀changes,฀restructuring฀charge฀reversals,฀impair-
ment฀of฀assets฀and฀interest฀income฀and฀expense.
Summarized฀financial฀information฀is฀shown฀in฀the฀following฀
table.฀The฀“Corporate฀and฀Other”฀column฀includes฀corporate-
related฀items,฀results฀of฀insignificant฀operations฀and,฀as฀it฀
relates฀to฀segment฀profit฀(loss),฀income฀and฀expense฀not฀allo-
cated฀to฀the฀Oilfield฀segment,฀including฀restructuring฀charge฀
reversals฀and฀impairment฀of฀assets.฀The฀“Corporate฀and฀
Other”฀column฀at฀December฀31,฀2003฀and฀2002฀also฀includes฀
assets฀of฀discontinued฀operations.
฀ ฀ Corporate฀฀
฀ Oilfield฀ and฀Other฀ Total
2004
฀ Revenues฀ $฀6,100.4฀ $฀ 3.4฀ $฀6,103.8
฀ Equity฀in฀income฀(loss)฀of฀affiliates฀ ฀ 36.8฀ ฀ (0.5)฀ ฀ 36.3
฀ Segment฀profit฀(loss)฀ ฀ 1,063.9฀ ฀ (283.4)฀ ฀ 780.5
฀ Total฀assets฀ ฀ 6,179.1฀ ฀ 642.2฀ ฀ 6,821.3
฀ Investment฀in฀affiliates฀ ฀ 678.1฀ ฀ –฀ ฀ 678.1
฀ Capital฀expenditures฀ ฀ 346.9฀ ฀ 1.4฀ ฀ 348.3
฀ Depreciation฀and฀amortization฀ ฀ 343.6฀ ฀ 28.2฀ ฀ 371.8
฀ ฀ ฀ ฀ ฀ ฀
2003฀ ฀ ฀ ฀ ฀ ฀
฀ Revenues฀ $฀5,252.3฀ $฀ 0.1฀ $฀5,252.4
฀ Equity฀in฀loss฀of฀affiliates฀ ฀ (8.6)฀ ฀ (129.2)฀ ฀ (137.8)
฀ Segment฀profit฀(loss)฀ ฀ 749.1฀ ฀ (424.4)฀ ฀ 324.7
฀ Total฀assets฀ ฀ 5,891.5฀ ฀ 525.0฀ ฀ 6,416.5
฀ Investment฀in฀affiliates฀ ฀ 662.9฀ ฀ 28.4฀ ฀ 691.3
฀ Capital฀expenditures฀ ฀ 401.0฀ ฀ 3.3฀ ฀ 404.3
฀ Depreciation฀and฀amortization฀ ฀ 320.2฀ ฀ 27.3฀ ฀ 347.5
฀ ฀ ฀ ฀ ฀ ฀
2002฀ ฀ ฀ ฀ ฀ ฀
฀ Revenues฀ $฀4,860.0฀ $฀ 0.2฀ $฀4,860.2
฀ Equity฀in฀income฀(loss)฀of฀affiliates฀ ฀ 18.5฀ ฀ (88.2)฀ ฀ (69.7)
฀ Segment฀profit฀(loss)฀ ฀ 727.8฀ ฀ (341.0)฀ ฀ 386.8
฀ Total฀assets฀ ฀ 5,830.1฀ ฀ 669.6฀ ฀ 6,499.7
฀ Investment฀in฀affiliates฀ ฀ 843.5฀ ฀ 28.5฀ ฀ 872.0
฀ Capital฀expenditures฀ ฀ 351.1฀ ฀ 4.8฀ ฀ 355.9
฀ Depreciation฀and฀amortization฀ ฀ 292.6฀ ฀ 27.0฀ ฀ 319.6
2004฀Form฀10-K฀฀฀฀฀55