Oct. 29, 2009 (PR Newswire) --

HOUSTON, Oct. 29 /PRNewswire-FirstCall/ --

Results Summary (dollars
in millions, except per
share data):
Three Months Ended Sept.   Nine Months Ended Sept.
------------------------   -----------------------
2009       2008             2009       2008
------     ------         --------   --------
Total revenues          $612.1     $543.9         $1,727.1   $1,448.9
Operating income        $105.6      $82.8           $265.9     $205.2
Income before
income taxes           $100.5      $70.3           $246.3     $181.6
Net income               $74.6      $46.8           $169.4     $120.7
Diluted EPS              $0.91      $0.57            $2.07      $1.43
Shares used to
compute diluted
EPS (000)              82,013     82,608           81,794     84,591
Total bookings          $290.8     $733.1         $1,051.3   $1,812.5
Total backlog         $1,644.9   $2,385.9         $1,644.9   $2,385.9

Dresser-Rand Group Inc. ("Dresser-Rand" or the "Company") (NYSE: DRC), a global supplier of rotating equipment and aftermarket parts and services, reported net income of $74.6 million, or $0.91 per diluted share, for the third quarter 2009. This compares to a net income of $46.8 million, or $0.57 per diluted share, for the third quarter 2008.

Vincent R. Volpe Jr., President and Chief Executive Officer of Dresser-Rand, said, "We are pleased to report another quarter of strong operating performance. Total revenues increased 12.5%, operating income increased 27.5% and net income improved 59.4% over the corresponding period of last year. We remain on track to achieve operating income for the full year in line with the guidance provided approximately one year ago.

"New Units bookings in the quarter of $79.0 million, however, fell short of the level previously expected," said Volpe. "While the low level of bookings in the third quarter reflected the ongoing project delays that we have discussed all year, it now appears that the awaited recovery has begun. Since the beginning of October, we have booked or received commitments for more than $250 million of new unit business. These include projects in both traditional and non-traditional markets. In our traditional upstream market, they include all of the compression and power generation equipment for a floating production, storage and offloading (FPSO) vessel destined for West Africa and the compression equipment for six different services for one of the world's largest liquefied natural gas projects. In the downstream market, they include all of the critical rotating equipment, a total of 21 units, for a large greenfield project in the Middle East. On the non-traditional market side, we will be supplying nine steam turbine generator sets for turbo-compound energy recovery systems that will be used on board nine new container ships.

"With signs of a market recovery, continuing strong level of inquiries, and visibility to potential orders, we reiterate our expectation for new unit bookings to be in the range of $700 million to $1.1 billion for the full year.

"On the aftermarket front, third quarter bookings of $211.8 million were also below our expectations," said Volpe. "This level of bookings was due to the ongoing reduction in the level of orders from one of our key national oil company clients, an unfavorable foreign exchange impact and reduced maintenance spending by our clients worldwide. For the first nine months, the unfavorable variance in aftermarket bookings on a year over year basis was 13.2%. Approximately half of that change can be attributed to the decline in bookings from the one national oil company client, and nearly half from an unfavorable foreign exchange impact. We expect aftermarket orders overall to improve sequentially in the fourth quarter. However, based on recent, direct dialogue with the one national oil company client in question, we currently expect this client's bookings levels to recover sometime in 2010, which is later than what had been previously anticipated. As a result, we now expect full year aftermarket bookings to be about fifteen percent lower than 2008, with approximately two-thirds of that decline attributable to the adverse impacts of the previously mentioned national oil company client and foreign exchange. In our view, given the present, global market conditions, we are pleased with the on-going strength of the aftermarket activity. It has been steady despite the volatility of commodity prices and our clients' infrastructure spending, which reinforces the overall resiliency of our business model."

Total revenues for the third quarter 2009 of $612.1 million increased $68.2 million, or 12.5%, compared with $543.9 million for the third quarter 2008. Total revenues for the nine months ended September 30, 2009, of $1,727.1 million increased $278.2 million, or 19.2%, compared with revenues of $1,448.9 million for the corresponding period in 2008.

Operating income for the third quarter 2009 was $105.6 million. This compares to operating income of $82.8 million for the third quarter 2008. Third quarter 2009 operating income increased from the year ago quarter primarily due to higher revenues, improvements in material and labor productivity and lower manufacturing capacity costs.

Operating income for the nine months ended September 30, 2009, was $265.9 million. This compares to operating income of $205.2 million for the corresponding period in 2008. Operating income increased from the year ago nine month period primarily due to higher revenues and improvements in material and labor productivity.

Net income for the third quarter of $74.6 million increased 59.4% from the corresponding period in 2008. The increase reflects the factors contributing to the change in operating income as well as net currency gains and a lower effective tax rate.

Bookings for the third quarter 2009 were $290.8 million, which was $442.3 million or 60.3% lower than the third quarter 2008 of $733.1 million. Bookings for the nine and twelve months ended September 30, 2009, of $1,051.3 million and $1,762.1 million, respectively, were 42.0% and 27.4% lower than the bookings for the corresponding periods ended September 30, 2008, of $1,812.5 million and $2,426.2 million, respectively.

The backlog at the end of September 2009, was $1,644.9 million or 31.1% lower than the backlog at the end of September 2008 of $2,385.9 million.

New Units Segment

New unit revenues for the third quarter 2009 of $347.2 million were up 13.2% compared with $306.7 million for the third quarter 2008. New unit revenues for the nine months ended September 30, 2009, of $973.9 million improved 28.9% compared with $755.4 million for the corresponding period in 2008.

New unit operating income was $55.9 million for the third quarter 2009 compared with operating income of $37.8 million for the third quarter 2008. This segment's operating margin was 16.1% compared with 12.3% for the third quarter 2008. The increase in this segment's operating results was primarily attributable to higher revenues, improvements in material and labor productivity and lower manufacturing capacity costs. The Company benefited from the high level of sales in the period while leveraging its ability to lower period and other costs due to the relatively low level of new unit bookings. The Company reiterates its belief that on a steady state basis, where bookings and sales are more comparable, new unit margins are expected to be closer to low double digits.

New unit operating income was $129.2 million for the nine months ended September 30, 2009, compared with operating income of $72.7 million for the corresponding period in 2008. This segment's operating margin for the nine months ended September 30, 2009, was 13.3% compared with 9.6% for the corresponding nine month period in 2008. The increases from the corresponding periods in 2008 were attributable to higher revenues and improvements in material and labor productivity.

Bookings for the three months ended September 30, 2009, of $79.0 million were 82.1% lower than bookings for the corresponding period in 2008 of $442.2 million. Bookings for the nine and twelve months ended September 30, 2009, of $357.5 million and $773.3 million, respectively, were 64.7% and 43.2% lower than the bookings for the corresponding periods ended September 30, 2008, of $1,013.4 million and $1,361.9 million, respectively.

The backlog at September 30, 2009, of $1,289.2 million was 34.4% lower than the $1,966.0 million backlog at September 30, 2008.

Aftermarket Parts and Services Segment

Aftermarket parts and services revenues for the third quarter 2009 of $264.9 million were up 11.7% compared with $237.2 million for the third quarter 2008.