<PAGE>
 
  Parts and Service. Energy Industries provides on-site maintenance services to
its rental and sales customers and to users of other natural gas compressor
packages. Maintenance services provided by Energy Industries include regular
monitoring of compressor package operations and performance of a standardized,
routine maintenance program for equipment in the field. Energy Industries sells
compressor parts and engines in connection with maintenance service operations.
Each branch location and each field technician maintains a small inventory of
commonly used natural gas compressor package parts to support routine repairs
to natural gas compressor packages covered under maintenance contracts.
 
  Natural Gas Compression Markets. Energy Industries conducts the majority of
its operations in established natural gas producing regions of the United
States, located in Texas, Louisiana, Arkansas, Oklahoma, New Mexico and
offshore in the Gulf of Mexico. Its customers include natural gas companies and
pipelines which are involved in the production, processing and transmission of
natural gas.
 
  A substantial majority of the demand for natural gas compression (on a
horsepower basis) is met through the use of natural gas compressor packages
owned by the companies that use them. Energy Industries competes with other
fabricators of natural gas compressors for sales in this market. The demand for
newly constructed natural gas compressor packages is a function of growth in
the consumption of natural gas and the age of producing wells. Natural gas
compression is required to maintain production rates and to maximize
recoverable reserves as natural gas reservoirs age and field pressure declines.
 
  The remaining demand for natural gas compression is met through rental of
natural gas compressor packages. In addition to well age and natural gas
consumption, a structural shift in U.S. oil and gas operations has affected
demand for natural gas compression package rentals. Many of the major oil
companies have directed their focus toward international operations and away
from domestic natural gas reserves. Accordingly, these companies recently have
been selling their domestic natural gas reserves and minimizing staff in
domestic operations. As a result, demand for rental packages of natural gas
compressors is expected to increase as buyers of natural gas reserves or
producers with reduced staffs are less likely to own and operate natural gas
compressor packages and more likely to rent natural gas compressor packages to
meet their natural gas compression needs.
 
  International Operations. While most of Energy Industries' operations are
domestic, Energy Industries sells natural gas compressor packages and parts in
Canada through ENSERV, Inc. ("Enserv") and outside the U.S. and Canada through
Atlas Copco Airpower, N.V. ("Atlas Copco"). The following table compares
domestic and international revenues for 1992 through 1994.
 

<TABLE>
<CAPTION>
                                                       1994     1993     1992
                                                      -------  -------  -------
                                                       (IN THOUSANDS, EXCEPT
                                                        PERCENTAGE AMOUNTS)
      <S>                                             <C>      <C>      <C>
      COMPRESSOR PACKAGE SALES:
        Domestic..................................... $21,397  $16,727  $16,359
        International................................   8,445    5,293    5,584
                                                      -------  -------  -------
          Total...................................... $29,842  $22,020  $21,943
                                                      =======  =======  =======
      PERCENT OF TOTAL SALES:
        Domestic.....................................    71.7%    76.0%    74.6%
        International................................    28.3%    24.0%    25.4%
</TABLE>

 
  Energy Industries has entered into an agreement whereby it is an exclusive
supplier of gas compressor packages and parts to Enserv in Canada. This
agreement runs through October 1996.
 
  Additionally, Energy Industries has entered into a marketing agreement with
Atlas Copco, headquartered in Belgium, for package sales outside North America.
As compensation for use of its worldwide marketing and distribution network,
Atlas Copco receives a commission on all such international sales of Energy
Industries' equipment. This agreement runs through 1998 and also is subject to
automatic annual renewal unless notice is given of a party's desire to
terminate the relationship.
 
                                       5