Exhibit 99.1
BAKER FILES 2005 FORM 10-K; RESTATES FINANCIAL RESULTS FOR 2003 AND 2004
PITTSBURGH, Aug. 15 /PRNewswire-FirstCall/ -- Michael Baker Corporation (Amex:
BKR) today announced the filing of its Annual Report on Form 10-K for the fiscal
year ended December 31, 2005, which includes the restatement of the company's
consolidated financial statements for the years ended December 31, 2004 and
2003. As outlined in the filing with the Securities and Exchange Commission,
Baker has restated its 2003 and 2004 financial statements as a result of the
company's identification of various tax accounting, non-routine accounting and
transaction errors, and describes in detail, in Footnote 2 of the Consolidated
Financial Statements included in Exhibit 13.1, the impact of the restatement on
the net income/(loss) and diluted earnings/(loss) per share for the two restated
periods. The complete copy of the Form 10-K can be found on the Investor
Relations portion of Baker's website at www.mbakercorp.com.
For 2005, the company reported net income of $5.1 million, or $0.58 per diluted
common share, on total contract revenues of $579 million, compared to restated
net income of $8.4 million, or $0.98 per diluted common share, on total contract
revenues of $552 million in 2004. For 2003, the company reported a restated net
loss of $0.8 million, or $0.10 per diluted common share, on total contact
revenues of $427 million. Income from operations in 2005 was $16.9 million,
compared to restated income from operations of $18.9 million and $5.7 million in
2004 and 2003, respectively.
The company's Engineering business segment's total contract revenues in 2005
were $371 million, compared to restated total contract revenues of $343 million
in 2004 and $251 million in 2003. The company's Energy business segment's total
contract revenues in 2005 were $208 million, compared to restated total contract
revenues of $209 million in 2004 and $176 million in 2003.
Operating income before corporate overhead allocations in the Engineering
segment for 2005 was $40.2 million, an increase of 21 percent compared to the
restated operating income before corporate overhead allocations for 2004. The
operating loss before corporate overhead in the Energy business for 2005 was
$0.9 million, a substantial decrease from the restated operating income before
corporate overhead allocations for 2004.
Total backlog for the Engineering and Energy businesses at year-end 2005 was
$1.32 billion, compared to $1.40 billion at year-end 2004. The year-over-year
decrease is attributable primarily to the work completed during the year on the
company's flood map modernization contract with FEMA. At December 31, 2005, $566
million of backlog related to this contract, compared to $678 million at
December 31, 2004.
Outlook for 2006
"The restatement is behind us, so we can now place our complete focus on
continuing to grow and to improve the profitability of our business segments,"
Donald P. Fusilli, Jr., president and chief executive officer, said. "The key
markets for our services are strong, and we expect them to remain so for the
foreseeable future. In the Engineering segment, recent contract awards with FEMA
and US-VISIT reflect a continued growth in Federal government spending in our
key target areas, and we are beginning to see increased activity for
transportation infrastructure projects resulting from the new SAFETEA-LU
legislation. In our Energy segment, our recent Managed Services contract awards
in Alabama and Alaska represent an increased demand for our higher margin,
comprehensive operations and maintenance services. Our challenge going forward
will be to further align our engineering and operations and maintenance services
with our clients' needs in the targeted markets that we serve."
Conference Call
Baker will hold a conference call and webcast at 10:00 a.m. EDT on Thursday,
August 17, to discuss these results. Please call 800-860-2442 at least 10
minutes prior to the start of the call. To access the webcast, please visit the
investor relations portion of Baker's website at www.mbakercorp.com.
Michael Baker Corporation (http://www.mbakercorp.com) provides engineering and
operations and maintenance services for its clients' most complex challenges
worldwide. The firm's primary practice areas are aviation, environmental,
facilities, geospatial information technologies, pipelines & telecommunications,
transportation, water/wastewater, and oil & gas. With more than 5,000 employees
in over 40 offices across the United States and internationally, Baker is
focused on providing services that span the complete life cycle of
infrastructure and managed asset projects.
(The above information contains forward-looking statements concerning our future
operations and performance. Forward-looking statements are subject to market,
operating and economic risks and uncertainties that may cause our actual results
in future periods to be materially different from any future performance
suggested herein. 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
our relationship and/or contracts with the Federal Emergency Management Agency
("FEMA"); changes in anticipated levels of government spending on
infrastructure, including the Safe, Accountable, Flexible, Efficient
Transportation Equity Act-A Legacy for Users ("SAFETEA- LU"); changes in loan
relationships or sources of financing; changes in management; and changes in
information systems. Such forward-looking statements are made pursuant to the
Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995.)
FINANCIAL SUMMARY
(Unaudited)
Fourth Quarter Operating Results Restated
(In thousands, except earnings per share) 2005 2004
- ------------------------------------------ ---------- ----------
Total contract revenues $ 143,585 $ 154,817
Gross profit $ 21,537 $ 19,679
Income from operations $ 3,744 $ 3,821
Income before taxes $ 3,024 $ 4,332
Net income $ 814 $ 2,304
Weighted average shares outstanding:
Basic 8,487 8,472
Diluted 8,713 8,658
Net income per share:
Basic $ 0.10 $ 0.26
Diluted $ 0.10 $ 0.26
- --------------------------------------------------------------------
Twelve Month Operating Results Restated
(In thousands, except earnings per share) 2005 2004
- ------------------------------------------ ---------- ----------
Total contract revenues $ 579,278 $ 552,046
Gross profit $ 83,395 $ 86,445
Income from operations $ 16,882 $ 18,868
Income before taxes $ 15,117 $ 18,719
Net income $ 5,051 $ 8,394
Weighted average shares outstanding:
Basic 8,507 8,402
Diluted 8,715 8,554
Net income per share:
Basic $ 0.59 $ 1.00
Diluted $ 0.58 $ 0.98
- --------------------------------------------------------------------
Segment results For the quarter ended For the year ended
(In millions) December 31 December 31
- ------------------------------- ----------------------- -----------------------
Restated Restated
2005 2004 2005 2004
---------- ---------- ---------- ----------
Engineering
- -----------
Total contract revenues $ 89.2 $ 101.3 $ 371.1 $ 343.3
Income from operations before
Corporate overhead 9.0 9.9 40.2 33.2
Less: Corporate overhead (3.7) (2.8) (13.6) (11.3)
- -----------------------------------------------------------------------------------
Income from operations 5.3 7.1 26.6 21.9
- -----------------------------------------------------------------------------------
Energy
- ------
Total contract revenues 54.4 53.5 208.2 208.7
Income from operations before
Corporate overhead 0.2 (1.7) (0.9) 2.7
Less: Corporate overhead (1.3) (1.2) (5.1) (4.7)
- -----------------------------------------------------------------------------------
Income from operations (1.1) (2.9) (6.0) (2.0)
- -----------------------------------------------------------------------------------
Total Reportable Segments
- -------------------------
Total contract revenues 143.6 154.8 579.3 552.0
Income from operations before
Corporate overhead 9.2 8.2 39.3 35.9
Less: Corporate overhead (5.0) (4.0) (18.7) (16.0)
- -----------------------------------------------------------------------------------
Income/(loss) from operations 4.2 4.2 20.6 19.9
- -----------------------------------------------------------------------------------
Other Corporate/Insurance
expense (0.4) (0.3) (3.7) (1.0)
- -----------------------------------------------------------------------------------
Total Company - Income from
operations $ 3.8 $ 3.9 $ 16.9 $ 18.9
- -----------------------------------------------------------------------------------
Backlog
(In millions) At 12/31/05 At 12/31/04
- --------------------------------------- ------------- -------------
Total $ 1,321.8 $ 1,399.5
- -----------------------------------------------------------------------
Condensed Balance Sheet Restated
(In thousands) At 12/31/05 At 12/31/04
- --------------------------------------- ------------- -------------
ASSETS
Cash and cash equivalents $ 19,041 $ 15,471
Receivables, net 79,177 79,559
Unbilled revenues 84,654 73,852
Prepaid expenses and other 8,373 11,893
- -----------------------------------------------------------------------
Total current assets 191,245 180,775
Property, plant and equipment, net 21,805 19,013
Goodwill and other intangible
assets, net 8,661 8,947
Other assets 3,750 6,278
- -----------------------------------------------------------------------
Total assets $ 225,461 $ 215,013
- -----------------------------------------------------------------------
LIABILITIES & SHAREHOLDERS' INVESTMENT
Accounts payable $ 45,570 $ 48,723
Accrued compensation and insurance 37,019 41,354
Other accrued expenses 46,332 37,369
Billings in excess of revenues 13,060 9,705
- -----------------------------------------------------------------------
Total current liabilities 141,981 137,151
Other long-term liabilities 3,656 3,081
- -----------------------------------------------------------------------
Total liabilities 145,637 140,232
- -----------------------------------------------------------------------
Common Stock 8,985 8,910
Additional paid-in capital 42,138 40,730
Retained earnings 34,339 29,288
Other comprehensive loss (704) (1,129)
Unearned compensation expense (173) (65)
Less - Treasury shares (4,761) (2,953)
- -----------------------------------------------------------------------
Total shareholders' investment 79,824 74,781
- -----------------------------------------------------------------------
Total liabilities &
shareholders' investment $ 225,461 $ 215,013
- -----------------------------------------------------------------------
SOURCE Michael Baker Corporation
-0- 08/15/2006
/CONTACT: David Higie of Michael Baker Corporation, +1-412-269-6449/
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(BKR)