Babcock Power Inc. repositions itself to meet changes in market demand

Burlington, MA, Oct. 3, 2003 — Babcock Power Inc. (BPI) is re-allocating resources from Vogt Power International Inc. (VPI), one of its four Business Units.

During the last two years, a large decrease in the demand for new natural gas fired power plants has occurred, resulting in the current significant overcapacity in the Heat Recovery Steam Generator (HRSG) industry.

Recognizing these changes, VPI, the leading worldwide supplier of HRSGs, will be shifting some of its resources to other BPI Business Units that are experiencing growth at this time.

While this may still result in a loss of some positions, it will enable VPI to reduce product cost, still maintain its core competencies, enable it to continue to provide quality products and services, and assist sister companies within the BPI family with experienced personnel. Furthermore, VPI has already begun restructuring its Sapulpa, OK manufacturing facility as a multi-product entity.

Dr. Marc Horvay, President and CEO of VPI stated from his international headquarters in Louisville, KY that, “We are fortunate to be part of a strong organization like BPI that has the flexibility to offset the impact of a downturn in one segment, with the growth and strength of BPI’s other Business Units. VPI will continue to actively sell HRSGs across its current product range, expand its aftermarket business, and increase its global leadership and presence throughout the world, while providing the same service and support its customers have come to expect over the last 40 years.”

In addition to the products and services furnished by VPI, BPI furnishes environmental products and services through its subsidiary located in Worcester, MA, Babcock Power Environmental Inc. (SCRs, FGD scrubbers, and mercury removal systems), provides heat exchangers and after market services associated with such heat exchangers, including moisture separator reheaters, steam surface condensers and feedwater heaters for fossil-fired and nuclear plants through its subsidiary located in Los Angeles, CA, Thermal Engineering International (USA) Inc., and furnishes steam generators and after market solutions to the electric utility and waste-to-energy industries through its Services Group located in Worcester, MA.

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