
<PAGE>


                                                       CONTACT:  JAMES C. SHAY
BHA-0406                                                 SENIOR VICE PRESIDENT
July 21, 2004                                          CHIEF FINANCIAL OFFICER
8:30 A.M. ET                                     (816) 356-8400, Extension 336

                       BHA GROUP HOLDINGS, INC. ANNOUNCES
                           THIRD QUARTER 2004 EARNINGS

For the quarter ended June 30, 2004 ("fiscal 2004"), BHA Group Holdings, Inc.'s
(NASDAQ - BHAG) consolidated net income was $3.3 million or $.49 per diluted
share. This compares to $1.8 million or $.27 per diluted share during the same
period in the prior year. For the nine months ended June 30, 2004, BHA's
consolidated net income was $11.1 million or $1.67 per diluted share compared to
$8.0 million or $1.23 per diluted share for first nine months of last year.

Commenting on the favorable results, James E. Lund, President and Chief
Executive Officer, said, "We are pleased to report an increase in sales and
earnings for the most recently completed quarter which is reflective of the
strength the Company has in the diversity of its businesses. The improved
results in worldwide fabric filter sales are consistent with strengthening in
the manufacturing sector in general. Our BHA Technologies business segment also
continues to perform well. Year-to-date sales of electrostatic precipitator
replacement parts and service are in line with our internal expectation."

The following table summarizes BHA's revenues and pre-tax income by segment
(dollars in millions):

<TABLE>
<CAPTION>
                                                     QUARTER ENDED                    NINE MONTHS ENDED
                                                       JUNE 30,                           JUNE 30,
                                                 2004             2003              2004             2003
                                                 ----             ----              ----             ----
<S>                                              <C>              <C>             <C>               <C>
REVENUES
Domestic Air Pollution Control (APC) Segment
     U.S. Fabric Filter                           21.8             17.7             62.7              54.5
     U.S. Electrostatic Precipitator (ESP)        14.8              6.3             34.2              43.1
     U.S. Exports to Latin America and Asia        6.4              4.6             16.2              11.5
                                                ------           ------           ------           -------
         Total Domestic APC Segment               43.0             28.6            113.1             109.1
Europe APC Segment                                 8.0              6.8             26.6              18.1
BHA Technologies Segment                           6.2              3.6             16.6              10.6
                                                ------           ------           ------           -------
     TOTAL REVENUES                               57.2             39.0            156.3             137.8
                                                ======           ======           ======           =======

PRE-TAX EARNINGS
Domestic APC Segment                               2.9              1.8              9.5               9.9
Europe APC Segment                                 0.4              0.2              1.6               0.1
BHA Technologies Segment                           1.6              0.6              5.5               1.9
                                                ------           ------           ------           -------
     TOTAL PRE-TAX EARNINGS                        4.9              2.6             16.6              11.9
                                                ======           ======           ======           =======
</TABLE>


<PAGE>


REVENUES
Consolidated revenues for the nine months ended June 30, 2004 increased 13% over
the same period in the prior year due to sales increases across all three
segments. Revenues for the Domestic APC segment increased 4% which included a
$12.9 million or 20% increase in fabric filter replacement parts to customers in
the U.S. and export markets. The increase in fabric filter sales corresponds to
improving business conditions in the manufacturing sector of those economies.
Year-to-date sales of electrostatic precipitator replacement parts and service
sales declined $8.9 million or 21%. Going into the year, the Company had
provided guidance that it expected a year-over-year decline in sales for this
portion of its business during the first half of the year due to the unusually
strong revenues of the ESP related business during the prior fiscal year. The
timing of execution of major project work tends to cause fluctuations in
quarterly sales results. On a U.S. dollar basis, sales for the Europe APC
segment increased 47% due to improving replacement parts business combined with
an increase in major project work. On a local currency basis, sales increased
31% over the prior year for the nine-month period. BHA Technologies' sales to
third parties increased by 57% due in large part to its continued success in
selling membrane products for use in non-consumer apparel applications.

Consolidated revenues for the quarter ended June 30, 2004 increased 47% over the
same period in the prior year. Sales for the Domestic APC segment for the third
quarter rose 50% over the prior year due to increases across both the fabric
filter and electrostatic precipitator parts and service product lines.
Consolidated revenue growth for the quarter was also attributable to the
increase in the Europe APC and BHA Technologies segments which rose 16% and 72%,
respectively, as compared to the same period in the prior year.

PRE-TAX EARNINGS
For the first nine months of the current fiscal year, pre-tax earnings were
$16.6 million, an increase of 40% over the prior year. The Company's pre-tax
earnings growth exceeded the growth in revenues due to improved gross margins.
Gross margin as a percentage of sales was 33.8% and 31.8% for the first nine
months of fiscal 2004 and 2003, respectively. The improved gross margins were
attributable to a combination of sales mix and cost reductions. Operating
margins as a percentage of sales were 10.8% and 8.9% for the first nine months
of fiscal 2004 and 2003, respectively.

Pre-tax earnings for the third quarter increased 89% to $4.9 million as compared
to $2.6 million in the same period of the prior year. The increase in pre-tax
earnings was attributable to the overall increase in sales. The results for the
quarter include $0.7 million in legal, investment banking and regulatory filing
fees relating to the pending merger with GE Energy.

INCOME TAXES
The Company's consolidated effective income tax rate was 33.5% for the nine
months ended June 30, 2004 compared to 33.0% for the same period in the prior
year. The final consolidated effective income tax rate for the 12 months ended
September 30, 2003 was 33.8%.

CASH FLOWS
For the first nine months of fiscal 2004, the Company generated $12.3 million in
cash flows from operations compared to $12.4 million generated during the same
period in the prior year. During the current year, cash was used in part to fund
capital expenditures of $2.6 million, pay cash dividends of $3.1 million and
repurchase treasury shares for $0.4 million.

BACKLOG
BHA's backlog was $57.0 million at June 30, 2004. This compares with order
backlogs of $71.9 million at March 31, 2004 and $59.1 million at June 30, 2003.

OUTLOOK
The following is specific guidance being provided for the fourth quarter of
fiscal 2004:


<PAGE>


    o    For the fourth quarter of fiscal 2004, the Company anticipates that
         consolidated net sales will increase by as much as 5% over the same
         period in the prior year.
    o    Earnings for the fourth quarter of fiscal 2004 are expected to be in
         the range of $.30 to $.35 per diluted share as compared to $.30
         reported for the same period in the prior year. The earnings per
         diluted share figures included within this Outlook section are
         exclusive of any estimated expenses associated with the merger with GE
         Energy discussed below.

For more information, you should refer to the sections entitled, "Outlook" and
"Factors Affecting Earnings and Share Price" included in the Company's Annual
Report on Form 10-K filed with the Securities and Exchange Commission on
November 11, 2003.

BHA Group Holdings, Inc. is a world leader in innovative filtration technology.
Its two principal operating subsidiaries are BHA Group, Inc., the world's
largest supplier of replacement parts and services for industrial air pollution
control systems, and BHA Technologies, Inc., which manufactures and markets
expanded polytetrafluoroethylene (ePTFE) membrane products for use in a variety
of industrial and consumer products.

This press release contains forward-looking statements that reflect the
Company's current views with respect to future events and financial performance.
These statements are subject to certain risks and uncertainties that could cause
actual results to differ materially from historical results or those
anticipated. The words "should," "believe," "anticipate," "expect," and other
expressions that indicate future events and trends identify forward-looking
statements. Actual future results and trends may differ materially from
historical results or those anticipated depending on a variety of factors,
including, but not limited to, the performance of newly established domestic and
international operations, demand and price for the Company's products and
services, and other factors. You should also consult the sections entitled
"Factors Affecting Earnings and Stock Price" and "Management's Discussion and
Analysis" included in the Company's report on Form 10-K which was filed with the
Securities & Exchange Commission on November 11, 2003 and the Company's report
on Form 10-Q for the most recently completed quarter expected to be filed today.


<PAGE>


                            BHA GROUP HOLDINGS, INC.
                   CONDENSED CONSOLIDATED STATEMENT OF INCOME
                                & BALANCE SHEETS
                     (IN MILLIONS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                          QUARTER ENDED                    NINE MONTHS ENDED
                                             JUNE 30                            JUNE 30
                                      2004             2003              2004             2003
                                      ----             ----              ----             ----
<S>                                 <C>              <C>               <C>              <C>
Net sales                            $ 57.2           $ 39.0            $156.3           $137.8
                                     ------           ------            ------           ------
Gross margin                           17.7             12.8              52.9             43.8
Operating expense                      12.8             10.1              36.1             31.5
Interest expense, net                     -               .1                .2               .4
                                     ------           ------            ------           ------
Earnings before income taxes            4.9              2.6              16.6             11.9
Income tax expense                      1.6               .8               5.5              3.9
Net income                           $  3.3           $  1.8            $ 11.1           $  8.0
                                     ======           ======            ======           ======
Diluted shares outstanding              6.8              6.6               6.6              6.5
                                     ======           ======            ======           ======
Diluted earnings per share           $ 0.49           $ 0.27            $ 1.67           $ 1.23
                                     ======           ======            ======           ======

Depreciation and amortization        $  1.5           $  1.4            $  4.3           $  4.4
                                     ======           ======            ======           ======
</TABLE>


The earnings per share figures in this press release are computed on a "diluted"
basis as defined under Statement of Financial Accounting Standards No. 128,
"Earnings per Share."

                                                 JUNE 30,        SEPTEMBER 30,
                                                   2004               2003
                                                   ----               ----

Cash and equivalents                           $   25.1           $   18.8
Accounts receivable                                34.8               28.8
Inventories                                        25.4               23.5
Other current assets                                6.2                5.2
                                               --------           --------
     Total current assets                          91.5               76.3
PP&E and other assets                              36.9               40.4
                                               --------           --------
Total assets                                   $  128.4           $  116.7
                                               ========           ========

Current debt and lease payments                $    2.5           $    2.5
Accounts payable and accruals                      27.9               23.5
                                               --------           --------
     Total current liabilities                     30.4               26.0
Long-term debt and capital leases                  10.2               12.2
Other liabilities                                   3.0                3.1
                                               --------           --------
Total liabilities                                  43.6               41.3
Equity                                             84.8               76.4
                                               --------           --------
Total liabilities and equity                   $  128.4           $  116.7
                                               ========           ========

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