Exhibit 99.1
Baker Reports Revenue and EPS Gains for First Quarter of 2004
PITTSBURGH, May 7 /PRNewswire-FirstCall/ -- Michael Baker Corporation
(Amex: BKR) today reported improved financial results for the first quarter of
2004, as total contract revenues and diluted earnings per share increased
significantly compared to the year-ago period. Both of the company's
operating segments posted revenue and operating income increases during the
quarter.
(Logo: http://www.newscom.com/cgi-bin/prnh/20020605/BAKERLOGO )
For the quarter, Baker posted net income of $3.1 million, or $0.37 per
diluted share, on total contract revenues of $125 million. This compares with
a net loss of ($97,000), or ($0.01) per diluted share, on total contract
revenues of $99 million in first-quarter 2003. The current quarter benefited
from a particularly strong revenue and operating performance in the
Engineering segment, relatively lower medical and retirement program benefit
costs, and a non-recurring gain on the sale of shares held of an insurance
firm. The 2003 first-quarter performance was adversely impacted by a number of
operating and other factors, including project mix in the Energy segment,
lower than anticipated volume and labor utilization rates in the Engineering
segment, and the startup and other costs associated with the company's new
information systems.
Revenues in the Engineering business were 28 percent greater than the same
period last year, while operating income before corporate overhead allocations
increased 154 percent. The major factor in the operating income improvement
was a significant increase in labor utilization rates during the quarter
compared to first-quarter 2003, the result of the substantial backlog of work
the segment had to begin 2004, including the recently awarded, up to
$750 million Program Management contract with the Federal Emergency Management
Agency (FEMA). Operating margins, before corporate overhead, were 9.5 percent
for first-quarter 2004, compared to 4.8 percent in first-quarter 2003.
Revenues in the Energy business were 23 percent higher, while operating
income before corporate overhead allocations increased 85 percent, in first-
quarter 2004 compared to first-quarter 2003. Contributing to these improved
results were higher volume and improved margins in several of the segment's
projects. Operating margins, before corporate overhead, were 4.8 percent for
the current quarter 2004, compared to 3.2 percent in the year-ago period.
Both the Engineering and Energy segments' operating results benefited from
the company's continuing cost containment efforts, including the adjustments
in the medical and retirement plans mentioned earlier.
Net interest expense was ($113,000) for the current quarter, compared to
net interest expense of ($82,000) for the prior period. At quarter's end, the
company had borrowings of $3.9 million, a reduction of approximately
$9.6 million from year-end levels.
Total backlog for the company was $1.4 billion at March 31, 2004, compared
to $721 million at year-end 2003. The first-quarter 2004 backlog includes
approximately $740 million for the FEMA contract.
Commenting on the results, President and Chief Executive Officer Donald P.
Fusilli, Jr., said, "Michael Baker Corporation is committed to our strategy of
focusing on the Engineering and Energy business to deliver improved financial
performance to our shareholders. We are pleased with these results, as they
indicate the potential this strategy has for our company. The backlog of work
we built in both segments during 2003 and early 2004 are yielding the expected
earnings growth. Engineering continues to receive contract awards across our
focused practice lines, especially in the Federal sector. Market conditions
in the Energy sector are improving with a stronger outlook for investment in
new projects, which we believe will benefit both our onshore managed services
and international O&M businesses. We remain optimistic about our 2004
performance, which we expect to be in line with our previously provided
guidance."
Michael Baker Corporation ( www.mbakercorp.com ) provides engineering and
energy expertise for public and private sector clients worldwide. The firm's
primary services include engineering design for the transportation and civil
infrastructure markets, operation and maintenance of oil and gas production
facilities, architecture, environmental services, and construction management
for building and transportation projects. Baker has more than 4,400 employees
in over 30 offices across the United States and internationally.
(The above information includes certain forward-looking statements
concerning future operations and performance of the Company. Forward-looking
statements are subject to market, operating and economic risks and
uncertainties that may cause the Company's actual results in future periods to
be materially different from the performance suggested above. Factors that
may cause such differences include, among others: increased competition;
increased costs; changes in general market conditions; changes in industry
trends; changes in the regulatory environment; changes in anticipated levels
of government spending on infrastructure; and changes in loan relationships or
sources of financing. Such forward-looking statements are made pursuant to the
Safe Harbor Provisions of the Private Securities Litigation Reform Act of
1995.)
FINANCIAL SUMMARY
(Unaudited)
First Quarter Operating Results For the quarter ended March 31
=============================== ==============================
(In thousands, except
earnings per share) 2004 2003
==== ====
Total contract revenues $125,005 $99,299
Gross profit $20,941 $13,446
Income/(loss) from operations $5,385 $(111)
Income/(loss) before taxes $5,845 $(179)
Net income/(loss) $3,098 $(97)
Weighted average shares outstanding:
Basic 8,320 8,346
Diluted 8,421 8,346
Net income/(loss) per share
Basic $0.37 $(0.01)
Diluted $0.37 $(0.01)
==========================================================================
For the quarter ended March 31
==============================
2004 2003
Engineering ==== ====
===========
Revenues $74.9 $58.7
Income from operations before
Corporate overhead 7.1 2.8
Less: Corporate overhead (2.8) (3.0)
=========================================================================
Income/(loss) from operations 4.3 (0.2)
=========================================================================
Energy
======
Revenues 50.1 40.6
Income from operations before
Corporate overhead 2.4 1.3
Less: Corporate overhead (1.1) (1.1)
=========================================================================
Income from operations 1.3 0.2
=========================================================================
Non-Core
========
Revenues - -
Income from operations before
Corporate overhead 0.3 0.3
Less: Corporate overhead - -
========================================================================
Income from operations 0.3 0.3
========================================================================
Total Reportable Segments
=========================
Revenues 125.0 99.3
Income from operations before
Corporate overhead 9.8 4.4
Less: Corporate overhead (3.9) (4.1)
========================================================================
Income from operations 5.9 0.3
========================================================================
Other Corporate/Insurance expense (0.5) (0.4)
========================================================================
Total Company - Income/(loss) from operations $5.4 $(0.1)
========================================================================
Backlog
=======
(In thousands) At 3/31/04 At 12/31/03
Total $1,428,900 $720,700
========================================================================
Condensed Balance Sheet
=======================
(In thousands) At 3/31/04 At 12/31/03
ASSETS
Cash and cash equivalents $5,277 $3,104
Receivables, net 80,122 75,790
Costs in excess of billings 49,452 51,620
Prepaid expenses and other 7,686 9,899
=========================================================================
Total current assets 142,537 140,413
Property, plant and equipment, net 16,749 17,402
Goodwill and other intangible
assets, net 9,161 9,233
Other assets 7,256 6,355
=========================================================================
Total assets $175,703 $173,403
=========================================================================
LIABILITIES & SHAREHOLDERS' INVESTMENT
Accounts payable $26,357 $22,109
Accrued compensation and insurance 31,903 25,618
Other accrued expenses 20,018 20,464
Billings in excess of costs 15,462 16,611
=========================================================================
Total current liabilities 93,740 84,802
Long-term debt 3,859 13,481
Other liabilities 2,417 2,539
=========================================================================
Total liabilities 100,016 100,822
=========================================================================
Common Stock 8,713 8,711
Additional paid-in capital 38,312 38,298
Retained earnings 32,575 29,477
Other comprehensive loss (928) (912)
Unearned compensation (32) (40)
Less - Treasury shares (2,953) (2,953)
=========================================================================
Total shareholders' investment 75,687 72,581
=========================================================================
Total liabilities &
shareholders' investment $175,703 $173,403
=========================================================================
SOURCE Michael Baker Corporation
-0- 05/07/2004
/CONTACT: David Higie of Michael Baker Corporation, +1-412-269-6449/
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/Web site: http://www.mbakercorp.com /
(BKR)
CO: Michael Baker Corporation
ST: Pennsylvania
IN: CST OIL
SU: ERN