Dresser-Rand Reports Third Quarter 2012 Diluted EPS of $0.54

         Dresser-Rand Reports Third Quarter 2012 Diluted EPS of $0.54

Strong Bookings and Record Level Backlog

PR Newswire

HOUSTON, Nov. 1, 2012

HOUSTON, Nov. 1, 2012 /PRNewswire/ --

Results Summary (dollars in millions,
except per share data):
                             Three Months Ended Sept.  Nine Months Ended Sept.
                             30,                       30,
                             2012           2011       2012          2011
Total revenues               $594.4         $630.5     $1,892.0      $1,573.6
Income from operations       $74.0          $73.2      $198.3        $131.1
Interest expense, net        ($15.7)        ($13.7)    ($47.9)       ($44.7)
Early redemption premium     $0.0           $0.0       $0.0          ($10.1)
on debt
Other income (expense),      $1.2           ($0.5)     $0.8          $1.3
net
Income before income         $59.5          $59.0      $151.2        $77.6
taxes
Net income attributable      $41.2          $40.3      $98.8         $51.9
to Dresser-Rand
Diluted EPS                  $0.54          $0.51      $1.30         $0.66
Shares used to compute       76,351         78,611     76,168        79,134
EPS (000)
Other information:
 Total bookings            $873.4         $1,170.7   $2,437.6      $2,296.8
 Total backlog             $3,111.0       $2,724.2   $3,111.0      $2,724.2

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 $41.2 million, or $0.54 per diluted share, for the
third quarter 2012. This compares to net income of $40.3 million, or $0.51
per diluted share, for the third quarter 2011.

Vincent R. Volpe Jr., President and Chief Executive Officer of Dresser-Rand,
said, "Results for the quarter were mixed with disappointing earnings set
against a backdrop of continued strong bookings and a record level backlog.
Operating income of approximately $74 million was lower than our earlier
expectation principally due to lower new unit revenues. There were four
projects that slipped out of the quarter that account for the lion's share of
the revenue miss. In the case of one of the projects, although the equipment
shipped in the third quarter, certain documents necessary to recognize revenue
were not obtained in time. As to the other three jobs, the causes for the
delays were unusual: one involved rescheduling of the factory acceptance test
by the client, one was impacted due to mishandling of the equipment by our
logistics provider and one involved a sale of a solar park that, after several
months of operation, experienced a transformer failure just prior to the point
of sale. Given the need to make the necessary repairs and demonstrate several
months of reliable operation, we now forecast sale of this park in 2013. The
three other projects are still forecast to close this year.

"Looking beyond the short term impact of the delayed new unit shipments this
quarter, we are extremely pleased with third quarter bookings. New unit
bookings of approximately $479 million were strong, with major orders coming
from both midstream and upstream applications, and add to the solid level of
bookings in the first six months of the year. We are working on a number of
potential major new unit orders that we expect to close in the fourth
quarter. As such, we are reiterating our guidance for record new unit
bookings in the range of $1.7 to $1.9 billion.

"Aftermarket parts and services bookings of $394 million were also strong,
reflecting continuing recovery in most geographic regions, especially the
Middle East and Latin America. We expect bookings to remain strong through
the balance of the year and into the next. As with the new unit segment, we
are reiterating our guidance for record aftermarket bookings in the range of
$1.4 to $1.6 billion.

"Our backlog at the end of the quarter was at a record level of approximately
$3.1 billion, which was 14% higher than the year ago level. Our new unit
backlog of $2.4 billion was up approximately 12%, with approximately $1,225
million of the new unit backlog scheduled to ship in 2013.

"For the full year, as reported at the time of our second quarter earnings
release, the adverse translational impact of a stronger U.S. dollar moved us
into the lower half of the range of our original operating income guidance of
$360 to $420 million.At present, we are now forecasting three items that will
have an impact on 2012 operating income. The first item is the solar park
referenced above.

"The second item relates to a delay in the release of the required letter of
credit (L/C) associated with a program to perform the Engineering Procurement
and Construction (EPC) activities associated with building an engine assembly
plant for a National Oil Company client. Late last year when we first set
guidance for 2012, we identified a potential risk related to this project.
While we have had the contract to perform this work in hand for over one year,
we are not in a position to start work until the required L/C is received.

Throughout the course of the year, it was our belief that the receipt of the
L/C would be forthcoming. Active conversations with our client continue and,
while we continue to believe this project will move forward, it is now
necessary to remove it and the income associated with the related engine
shipments from the 2012 forecast.

We estimate the impact on operating income of moving the above two items out
of the year to be approximately $20 million.

"The third item that will affect fourth quarter earnings is one time in nature
and involves costs that we are electing to incur. The integration of Guascor
over the past 18 months has been focused on governance, reliable financial
reporting, and the cross selling synergies available based on our expanded
market reach and product portfolio. Rather than continuing to operate Guascor
as a stand-alone business unit, the final step of the integration is now to
align the existing organizations and rationalize non-critical business assets.
This was part of the original integration plan, although the date was not
determined. We are now confident that the organization is prepared for this
step, and the process will take place over the next six months such that many
of the benefits impact our 2013 results.

"We estimate these one-time costs associated with this organizational
alignment to be approximately $10 million, with the preponderance incurred in
the fourth quarter. The impact from synergies next year is expected to be
approximately $18 million.

"In summary, based principally on the impact from the delay in the sale of the
solar park and the National Oil Company program combined with one-time
expenses of $10 million associated with the Guascor organization integration,
we now believe operating income for 2012 will be approximately $340 million."

Discussion of Results:

Total revenues for the third quarter 2012 of $594.4 million decreased $36.1
million, or 5.7%, compared with $630.5 million for the third quarter 2011.
Revenues decreased as a result of lower volume in the new unit segment
partially offset by higher volume in the aftermarket segment.Revenues in the
third quarter 2012 would have been approximately $42.6 million higher by
applying exchange rates from the corresponding period in 2011.

Total revenues for the nine months ended September 30, 2012, of $1,892.0
million increased $318.4 million, or 20.2%, compared with revenues of $1,573.6
million for the corresponding period in 2011. The increase is principally
attributable to higher volume in both the new units and aftermarket segments
and the acquisition of Grupo Guascor, which closed in May 2011. Guascor
accounted for approximately $88.9 million of the increase. Revenues in the
first nine months of 2012 would have been approximately $93.1 million higher
by applying exchange rates from the corresponding period in 2011.

Operating income for the third quarter 2012 was $74.0 million. This compares
to operating income of $73.2 million for the third quarter 2011. Third
quarter 2012 operating income increased from the year ago quarter primarily
due to higher aftermarket revenues offset by lower new unit revenues.

As a percentage of revenues, operating income for the third quarter 2012 was
12.4%, compared to 11.6% for the corresponding period in 2011. The increase
was primarily attributable to an overall shift in the mix of revenues to our
aftermarket segment from the new units segment and the factors mentioned
above.

Operating income for the nine months ended September 30, 2012, was $198.3
million. This compares to operating income of $131.1 million for the
corresponding period in 2011. Operating income increased from the
corresponding period in 2011 primarily due to higher aftermarket revenues,
which were partially offset by the translation impact of the stronger U.S.
dollar. Additionally, operating income in the first nine months of 2011
reflects a number of adverse impacts including non-recurring integration and
transaction-related expenses in connection with the acquisition of Guascor in
May 2011 and the political instability in the Middle East and North Africa.
The non-recurring integration and transaction-related expenses totaled
approximately $14.9 million for the first nine months of 2011. The political
instability in the Middle East and North Africa adversely affected the first
nine months of 2011 by approximately $10.4 million.

As a percentage of revenues, operating income for the nine months ended
September 30, 2012, was 10.5%, compared to 8.4% for the nine months ended
September 30, 2011. The increase in operating income as a percent of sales is
principally due to the factors mentioned above.

The effective tax rate for the third quarter 2012 was lower than expected due
to certain foreign tax credits.

Net income for the third quarter 2012 of $41.2 million was essentially the
same as the corresponding period in 2011. Net income for the nine months
ended September 30, 2012, of $98.8 million compares to $51.9 million for the
corresponding period in 2011. The increase is principally attributable to the
factors mentioned above and a pre-tax prepayment premium incurred in 2011 of
$10.1 million as a result of executing the cash tender offer to purchase the
previously outstanding 7 3/8% Senior Subordinated Notes.

Bookings in the third quarter 2012 were $873.4 million compared to $1,170.7
million for the corresponding period in 2011, a decrease of $297.3 million or
25.4%. As previously reported, the Company received in 2011 approximately
$700 million of Petrobras contracts to supply all Turbo Compressors for the 8
"replicant" FPSOs destined for the Lula and Guara fields offshore Brazil. It
should be noted that, due to the Company's booking policy, the Company
recorded bookings of approximately $410 million in new units and $60 million
in aftermarket services related to the Petrobras awards in the third quarter
2011.

Bookings for the nine and twelve months ended September 30, 2012, of $2,437.6
million and $2,999.4 million, respectively, compare to bookings for the
corresponding periods ended September 30, 2011, of $2,296.8 million and
$3,050.2 million, respectively.

The backlog at the end of September 2012 was a record $3,111.0 million, or
14.2% higher than the backlog at the end of September 2011 of $2,724.2
million.

New Units Segment

New unit revenues for the third quarter 2012 of $247.5 million decreased $45.1
million, or 15.4%, compared with $292.6 million for the third quarter 2011.
The decrease in third quarter 2012 revenues compared to the corresponding
period in 2011 reflects the variability in the timing and the size of very
large orders in the new units segment. New units revenues in the third
quarter 2012 would have been approximately $14.0 million higher by applying
exchange rates from the corresponding period in 2011.

New unit revenues for the nine months ended September 30, 2012, of $902.6
million increased $163.6 million, or 22.1%, compared with $739.0 million for
the corresponding period in 2011. Revenues increased principally as a result
of higher volume. New units revenues in the first nine months of 2012 would
have been approximately $37.2 million higher by applying exchange rates from
the corresponding period in 2011.

New unit operating income was $21.1 million for the third quarter 2012
compared with operating income of $30.2 million for the third quarter 2011.
This segment's operating margin was 8.5% compared with 10.3% for the third
quarter 2011. The decrease in operating income and margin from the
corresponding period in 2011 was principally attributable to the lower volume.

New unit operating income was $68.6 million for the nine months ended
September 30, 2012, compared with operating income of $66.0 million for the
corresponding period in 2011. This segment's operating margin for the nine
months ended September 30, 2012, was 7.6% compared with 8.9% for the
corresponding period in 2011. The decrease in operating margin from the
corresponding period in 2011 was principally attributable to a less favorable
mix within the segment.

Bookings for the three months ended September 30, 2012, of $478.8 million
compare to new unit bookings in the corresponding period in 2011 of $732.1
million, a decrease of $253.3 million or 34.6%. As previously mentioned, new
unit bookings in the third quarter 2011 include approximately $410 million in
connection with the Petrobras award for 8 "replicant" FPSOs. Bookings for the
nine and twelve months ended September 30, 2012, of $1,266.7 million and
$1,492.8 million, respectively, compare to bookings for the corresponding
periods ended September 30, 2011, of $1,274.2 million and $1,754.5 million,
respectively. The backlog at September 30, 2012, of $2,449.9 million was
12.4% higher than the backlog of $2,180.2 million at September 30, 2011.

Aftermarket Parts and Services Segment

Aftermarket parts and services revenues for the third quarter 2012 of $346.9
million increased $9.0 million, or 2.7%, compared with $337.9 million for the
third quarter 2011. Revenues increased principally due to the continuing
market recovery. Aftermarket revenues in the third quarter 2012 would have
been approximately $28.6 million higher by applying exchange rates from the
corresponding period in 2011.

Aftermarket parts and services revenues for the nine months ended September
30, 2012, of $989.4 million increased $154.8 million, or 18.5%, compared with
$834.6 million for the corresponding period in 2011. Revenues increased
principally as a result of growth in most geographic segments, especially the
Middle East and Latin America, and the Guascor acquisition. Guascor accounted
for approximately $90.3 million of the increase. Aftermarket revenues in the
first nine months of 2012 would have been approximately $55.9 million higher
by applying exchange rates from the corresponding period in 2011.

Aftermarket operating income for the third quarter 2012 of $76.1 million
increased $7.3 million, or 10.6%, compared with $68.8 million for the third
quarter 2011. This segment's operating margin for the third quarter 2012 of
approximately 21.9% compares with 20.4% for the third quarter 2011. The
increase in this segment's operating margin is principally attributable to a
more favorable mix within the segment partially offset by the higher
allocation of overhead cost to the segment resulting from the higher
percentage of aftermarket revenues to total revenues in 2012.

Aftermarket operating income for the nine months ended September 30, 2012, of
$199.3 million increased $55.1 million, or 38.2%, compared with $144.2 million
for the corresponding period in 2011. This segment's operating margin for the
nine months ended September 30, 2012, of approximately 20.1% compares with
17.3% for the corresponding period in 2011. The increases in both operating
income and margin were principally due to higher volume and a more favorable
mix within the segment.

Bookings for the three months ended September 30, 2012, of $394.6 million were
$44.0 million or 10.0% lower than bookings for the corresponding period in
2011 of $438.6 million. As previously mentioned, aftermarket bookings in the
third quarter 2011 include approximately $60 million in connection with the
Petrobras award for 8 "replicant" FPSOs. Bookings for the nine and twelve
months ended September 30, 2012, of $1,170.9 million and $1,506.6 million,
respectively, compare to bookings for the corresponding periods ended
September 30, 2011, of $1,022.6 million and $1,295.7 million, respectively.
The backlog at September 30, 2012, of $661.1 million was 21.5% higher than the
backlog of $544.0 million at September 30, 2011.

Liquidity and Capital Resources

As of September 30, 2012, the Company had cash and cash equivalents of $150.9
million and the ability to borrow $245.4 million under the $764.3 million
revolving portion of its Senior Secured Credit Facility, as $213.9 million was
used for outstanding letters of credit and $305.0 million of borrowings was
outstanding. In addition to these letters of credit, $133.0 million of letters
of credit and bank guarantees were outstanding at September 30, 2012, which
were issued by banks offering uncommitted lines of credit.

In the first nine months of 2012, cash provided by operating activities was
$49.3 million compared with $78.8 million for the corresponding period in
2011. The decrease of $29.5 million in net cash provided by operating
activities was principally from changes in working capital, which more than
offset higher net income.

Net cash used in investing activities was $104.9 million for the nine months
ended September 30, 2012, compared to $324.3 million for the nine months ended
September 30, 2011. Cash used in investing activities in 2012 includes $48.9
million of capital expenditures, $48.8 million related to the acquisition of
Synchrony, Inc. (net of cash acquired) and $10.0 million related to an
additional capital investment in the noncontrolling interest of Echogen Power
Systems, LLC. Cash used in investing activities in the first nine months of
2011 includes $283.5 million related to the acquisition of Guascor (net of
cash acquired), which closed on May 4, 2011. Cash provided by financing
activities was $77.5 million in the first nine months of 2012, compared to
cash used in financing activities of $29.5 million in the first nine months of
2011.

During the nine months ended September 30, 2011, the Company refinanced its
unsecured senior subordinated notes, initiated three separate Accelerated
Stock Buyback (ASB) programs totaling $505.0 million and entered into a new
senior secured credit facility.

As of September 30, 2012, total debt was $1,095.9 million and total debt net
of cash and cash equivalents was approximately $920.7 million.

Outlook

The Company expects its full year operating income to be approximately $340
million, including the one-time integration expense of approximately $10
million for Guascor. The Company reiterates its guidance for 2012 new unit
bookings of $1.7 to $1.9 billion, aftermarket bookings of $1.4 to $1.6
billion, and before the impact of the Guascor integration costs, new unit
segment margins of approximately 10% and aftermarket segment margins in the
range of 22 to 24%. The Company expects its full year 2012 interest expense
to be in the range of $60 to $65 million and its effective tax rate to be
approximately 32 to 34%.

Conference Call

The Company will discuss its third quarter 2012 results at its conference call
on November 2, 2012, at 9:00 a.m. Eastern Time. You may access the live
webcast presentation at www.dresser-rand.com. Participants may also join the
conference call by dialing (877) 868-1831 in the U.S. and (914) 495-8595 from
outside the U.S. five to ten minutes prior to the scheduled start time.

A replay of the webcast will be available from 12:00 noon Eastern Time on
November 2, 2012, through 11:59 p.m. Eastern Time on November 9, 2012. You
may access the webcast replay at www.dresser-rand.com. The replay of the
conference can be accessed by dialing (800) 585-8367 in the U.S. and (404)
537-3406 from outside the U.S. The replay pass code is 47649371.

About Dresser-Rand

Dresser-Rand is among the largest suppliers of rotating equipment solutions to
the worldwide oil, gas, petrochemical, and process industries. The Company
operates manufacturing facilities in the United States, France, United
Kingdom, Spain, Germany, Norway, and India, and maintains a network of 49
service and support centers (including 6 engineering and R&D centers) covering
more than 150 countries.

This news release may contain forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. Forward-looking
statements include, without limitation, the Company's plans, objectives,
goals, strategies, future events, future bookings, revenues, or performance,
capital expenditures, financing needs, plans, or intentions relating to
acquisitions, business trends, executive compensation, and other information
that is not historical information. The words "anticipates", "believes",
"expects, "intends", "appears", "outlook," and similar expressions identify
such forward-looking statements. Although the company believes that such
statements are based on reasonable assumptions, these forward-looking
statements are subject to numerous factors, risks, and uncertainties that
could cause actual outcomes and results to be materially different from those
projected. These factors, risks, and uncertainties include, among others, the
following:economic or industry downturns; the variability of bookings due to
volatile market conditions, subjectivity clients exercise in placing orders,
and timing of large orders; volatility and disruption of the credit markets;
its inability to generate cash and access capital on reasonable terms and
conditions; its inability to implement its business strategy to increase
aftermarket parts and services revenue; its ability to comply with local
content requirements; delivery delays by certain third party suppliers of
large equipment; its ability to implement potential tax strategies;
competition in its markets; failure to complete or achieve the expected
benefits from any future acquisitions; economic, political, currency and other
risks associated with international sales and operations; fluctuations in
currencies and volatility in exchange rates; loss of senior management;
environmental compliance costs and liabilities; failure to maintain safety
performance acceptable to its clients; failure to negotiate new collective
bargaining agreements; unexpected product claims and regulations; infringement
on its intellectual property or infringement on others'' intellectual
property; its pension expenses and funding requirements; difficulty in
implementing an information management system; and the Company's brand name
may be confused with others. These and other risks are discussed in detail in
the Company's filings with the Securities and Exchange Commission at
www.sec.gov. Actual results, performance, or achievements could differ
materially from those expressed in, or implied by, the forward-looking
statements. The Company can give no assurances that any of the events
anticipated by the forward-looking statements will occur or, if any of them
does, what impact they will have on results of operations and financial
condition. The company undertakes no obligation to update or revise
forward-looking statements, which may be made to reflect events or
circumstances that arise after the date made or to reflect the occurrence of
unanticipated events, except as required by applicable law. For information
about Dresser-Rand, go to its website at www.dresser-rand.com.

DRC-FIN

DRESSER-RAND GROUP INC.
CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
                             Three months ended          Nine months ended
                             September 30,               September 30,
                             2012             2011       2012        2011
                             ($ in millions, except per share amounts)
                             $          $      $       $    
Net sales of products       390.3                     1,312.4    1,118.3
                                              440.0
Net sales of services        204.1            190.5      579.6       455.3
 Total revenues              594.4            630.5      1,892.0     1,573.6
Cost of products sold        279.5            323.0      989.1       822.5
Cost of services sold        144.3            136.1      419.6       333.1
 Total cost of sales         423.8            459.1      1,408.7     1,155.6
  Gross profit               170.6            171.4      483.3       418.0
Selling and administrative   90.2             89.6       267.4       266.2
expenses
Research and development     6.4              8.6        17.6        20.7
expenses
  Income from operations     74.0             73.2       198.3       131.1
Interest expense, net        (15.7)           (13.7)     (47.9)      (44.7)
Early redemption premium on  -                -          -           (10.1)
debt
Other income (expense), net 1.2              (0.5)      0.8         1.3
  Income before income taxes 59.5             59.0       151.2       77.6
Provision for income taxes   17.4             17.9       49.8        26.4
  Net income                 42.1             41.1       101.4       51.2
     Net (income) loss
     attributable to         (0.9)            (0.8)      (2.6)       0.7
     noncontrolling interest
  Net income attributable to $          $      $       $    
  Dresser-Rand               41.2                             
                                              40.3      98.8       51.9
Net income attributable to
Dresser-Rand per share
                             $          $      $       $    
  Basic                       0.55                             
                                              0.52      1.31       0.66
                             $          $      $       $    
  Diluted                     0.54                             
                                              0.51      1.30       0.66
Weighted average shares
outstanding - (in thousands)
  Basic                      75,542           77,860     75,455      78,373
  Diluted                    76,351           78,611     76,168      79,134

DRESSER-RAND GROUP INC.
CONSOLIDATED SEGMENT DATA
(Unaudited)
                   Three months ended September   Nine months ended September
                   30,                            30,
                   2012            2011           2012           2011
                   ($ in millions)
Revenues
                   $         $        $        $      
New units              247.5                           
                                   292.6         902.6         739.0
Aftermarket parts  346.9           337.9          989.4          834.6
and services
                   $         $        $        $      
Total revenues         594.4                1,892.0     1,573.6
                                   630.5
Gross profit
                   $         $        $        $      
New units                                             
                   44.9           56.2          141.4         140.9
Aftermarket parts  125.7           115.2          341.9          277.1
and services
                   $         $        $        $      
Total gross profit     170.6                           
                                   171.4         483.3         418.0
Income from
operations
                   $         $        $        $      
New units                                             
                   21.1           30.2          68.6          66.0
Aftermarket parts  76.1            68.8           199.3          144.2
and services
Unallocable        (23.2)          (25.8)         (69.6)         (79.1)
Total income from  $         $        $        $      
operations                                            
                   74.0           73.2          198.3         131.1
Bookings
                   $         $        $        $      
New units              478.8                1,266.7     1,274.2
                                   732.1
Aftermarket parts  394.6           438.6          1,170.9        1,022.6
and services
Total bookings     $         $        $        $      
                       873.4     1,170.7     2,437.6     2,296.8
Backlog - ending
New units          $         $        $        $      
                      2,449.9      2,180.2     2,449.9     2,180.2
Aftermarket parts  661.1           544.0          661.1          544.0
and services
Total backlog      $         $        $        $      
                      3,111.0      2,724.2     3,111.0     2,724.2

DRESSER-RAND GROUP INC.
CONSOLIDATED BALANCE SHEET
(Unaudited)
                                                   September 30,  December 31,
                                                   2012           2011
                                                   ($ in millions)
Assets
Current assets
   Cash and cash equivalents                       $        $     
                                                    150.9         128.2
   Restricted cash                                 24.3           29.5
   Accounts receivable, less allowance for losses  412.2          477.5
   of $8.2 at 2012 and $9.3 at 2011
   Inventories, net                               506.3          407.7
   Prepaid expenses and other                      87.0           67.1
   Deferred income taxes, net                      40.3           40.3
      Total current assets                         1,221.0        1,150.3
Property, plant and equipment, net                457.6          456.0
Goodwill                                         894.2          869.8
Intangible assets, net                            511.3          508.0
Deferred income taxes                              12.3           11.1
Other assets                                       76.9           68.5
      Total assets                                 $         $    
                                                   3,173.3       3,063.7
Liabilities and Stockholders' Equity
Current liabilities
   Accounts payable and accruals                  $        $     
                                                    544.0         600.7
   Customer advance payments                       260.1          272.2
   Accrued income taxes payable                   12.8           20.1
   Current portion of long-term debt               27.4           39.3
      Total current liabilities                    844.3          932.3
Deferred income taxes                              49.1           45.2
Postemployment and other employee benefit          123.6          135.9
liabilities
Long-term debt                                    1,068.5        990.4
Other noncurrent liabilities                       84.8           86.9
      Total liabilities                            2,170.3        2,190.7
Stockholders' equity
   Common stock, $0.01 par value, 250,000,000
   shares authorized;
      and 75,665,943 and 75,363,784 shares issued
      and outstanding atSeptember 30, 2012, and    0.8            0.8
      December 31, 2011, respectively
   Additional paid-in capital                      131.1          105.3
   Retained earnings                               1,004.3        905.5
   Accumulated other comprehensive loss            (135.6)        (138.8)
      Total Dresser-Rand stockholders' equity      1,000.6        872.8
   Noncontrolling interest                         2.4            0.2
      Total stockholders' equity                   1,003.0        873.0
      Total liabilities and stockholders' equity   $         $    
                                                   3,173.3       3,063.7

DRESSER-RAND GROUP INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
                                               Nine months ended Septemer 30,
                                               2012             2011
                                               ($ in millions)
Cash flows from operating activities
  Net income                                  $          $      
                                               101.4            51.2
  Adjustments to reconcile net income to net
  cash provided by operating activities:
    Depreciation and amortization              64.2             59.9
    Deferred income taxes                      7.4              9.3
    Stock-based compensation                   20.4             9.2
    Excess tax benefits from stock-based       (4.0)            (3.6)
    compensation
    Amortization of debt financing costs       2.9              10.8
    Provision for losses on inventory          0.7              0.4
    Loss on sale of property, plant and        0.8              0.2
    equipment
    Net loss from equity investments           1.0              0.1
    Changes in working capital and other, net
    of acquisitions
        Accounts receivable                    67.1             19.8
        Inventories                            (95.9)           (76.8)
        Accounts payable and accruals          (60.2)           6.2
        Customer advances                      (15.7)           50.9
    Other, principally tax and pension         (40.8)           (58.8)
    accruals
        Net cash provided by operating         49.3             78.8
        activities
Cash flows from investing activities
  Capital expenditures                         (48.9)           (38.8)
  Proceeds from sales of property, plant and   0.8              0.3
  equipment
  Acquisitions, net of cash acquired           (48.8)           (283.5)
  Other investments                            (13.2)           (10.0)
  Decrease in restricted cash balances         5.2              7.7
        Net cash used in investing activities  (104.9)          (324.3)
Cash flows from financing activities
  Proceeds from exercise of stock options      2.5              2.7
  Proceeds from borrowings                     387.6            1,306.6
  Excess tax benefits from stock-based         4.0              3.6
  compensation
  Repurchase of common stock                   -                (505.0)
  Payments for debt financing costs            (0.4)            (15.7)
  Repayments of borrowings                     (316.2)          (821.7)
        Net cash provided by (used in)         77.5             (29.5)
        financing activities
Effect of exchange rate changes on cash and    0.8              1.3
cash equivalents
Net increase (decrease) in cash and cash       22.7             (273.7)
equivalents
Cash and cash equivalents, beginning of period 128.2            420.8
Cash and cash equivalents, end of period       $          $      
                                               150.9           147.1

DRESSER-RAND GROUP INC.
       Reconciliation of GAAP to Non-GAAP Financial Information
       
       (Unaudited)
       Net Debt:
                                                        September    December
                                                        30,          31,
                                                        2012         2011
                                                        ($ in millions)
Components of net debt
                                                        $       $    
       Cash, cash equivalents and restricted cash         175.2      
                                                                     157.7
       Current portion of long-term debt               (27.4)       (39.3)
       Long-term debt                                   (1,068.5)    (990.4)
                                                        $       $    
       Net debt                                          (920.7)     
                                                                     (872.0)
Net debt is defined as total debt minus cash and cash
equivalents. The Company's management views net debt,
a non-GAAP financial measure, to be a useful measure of
a company's ability to reduce debt, add to cash
balances, pay dividends, repurchase stock, and fund
investing and financing activities.

SOURCE Dresser-Rand Group Inc.

Website: http://www.dresser-rand.com
Contact: Investors, Blaise Derrico, Vice President, Investor Relations,
+1-713-973-5497