<PAGE>
Year-to-date, fiscal 1995 revenues of $7.5 million and operating income
of $528,000 compared favorably to the fiscal 1994 revenues of $9.3 million and
operating loss of $18.1 million due primarily to the 1994 property write-down.
Bolivian operations contributed operating income of $1.2 million in fiscal 1995
and $2.4 million in fiscal 1994.
NATURAL GAS COMPRESSION
- -----------------------
In April 1995, Zapata announced that the Company was considering the sale
of its natural gas compression operations. In June 1995, Zapata announced that
it had entered into an agreement to sell the assets of its natural gas
compression division for $130 million to Enterra Corporation. The sale is
subject to stockholder approval and certain governmental approvals.
The major segments of Energy Industries' natural gas compression revenues
and operating results for the three-month and nine-month periods ended June 30,
1995 and the three-month and eight-month periods ended June 30, 1994, in
thousands, are identified below.
<TABLE>
<CAPTION>
Three Months Ended Nine Months Eight Months
June 30, Ended June 30,
---------------------- -----------------------------
1995 1994 1995 1994
---------- --------- ------------ ----------
<S> <C> <C> <C> <C>
Revenues
- --------------------------
Compressor Rental $ 4,403 $ 5,163 $12,978 $12,066
Fabrication and Sales 8,989 9,272 21,879 17,150
Parts & Service 4,731 5,187 14,919 14,123
Other 1,206 2,188 3,310 6,535
------- ------- ------- -------
$19,329 $21,810 $53,086 $49,874
======= ======= ======= =======
Operating Results
- --------------------------
Compressor Rental $ 1,175 $ 1,336 $ 3,592 $ 3,686
Fabrication and Sales 875 1,206 2,421 1,762
Parts & Service 850 1,152 2,818 2,760
Other 198 383 348 908
Selling & Administrative (1,394) (1,617) (4,378) (4,274)
------- ------- ------- -------
$ 1,704 $ 2,460 $ 4,801 $ 4,842
======= ======= ======= =======
</TABLE>
(The Other segment includes the results of the heat exchanger
manufacturing operation which was sold during the second quarter of fiscal 1995
and used equipment sales.)
Natural gas compressor package rental utilization is affected
primarily by the number and age of producing oil and gas wells, the volume of
natural gas consumed and natural gas prices. Rental rates are determined
primarily by the demand for compressor packages and vary by size and horsepower
of a compressor package. Energy Industries' utilization, rental rates and fleet
size as of June 30, 1995 and 1994 are compared in the following table.
14
