Baker Reports Strong Financial Results for Third Quarter 2000.Business Editors PITTSBURGH--(BUSINESS WIRE)--Oct. 23, 2000 Michael Baker Corporation Michael Baker Corporation is an engineering and energy management corporation headquartered in the Pittsburgh suburb of Moon Township, Pennsylvania. Its headquarters is located in Airside Business Park, an office park near the Pittsburgh International Airport that the company (AMEX AMEX See: American Stock Exchange :BKR BKR Baker BKR Birkirkara (postal locality, Malta) BKR Breaker BKR Broadcast Key Rotation BKR Best-Known Recipe ) today reported strong financial results for the third quarter and first nine months of 2000. For the quarter, the company achieved net income of $2.3 million, or 29 cents per basic share and 28 cents per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, on total contract revenues of $92 million. This compares with a net loss of ($4.0) million, or (49) cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. , on revenues of $130 million in the third quarter of 1999. The year ago quarter was negatively impacted by pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta charges totaling $11.6 million, related primarily to the Buildings and Heavy and Highway construction divisions, which since have been sold or are in the final stages of being wound down. The disposition of these two divisions combined with the sale of Baker Support Services support services Psychology Non-health care-related ancillary services–eg, transportation, financial aid, support groups, homemaker services, respite services, and other services during the second quarter of 2000 accounts for the year-to-year decrease in revenue. For the first nine months of 2000, net income was $6.6 million, or 81 cents per basic share and 80 cents per diluted share, on revenues of $298 million, compared to a net loss of ($1.7) million, or (21) cents per share, on revenues of $379 million in third-quarter 1999. The third quarter financial results for the company's ongoing core Energy and Engineering businesses also showed considerable improvement over the prior periods. In the Energy segment, total contract revenues grew 67 percent and operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. rose 77 percent, benefiting from the fourth quarter 1999 acquisition of Steen Steen , Jan 1626?-1679. Dutch genre painter known for his humorous and moralistic depictions of domestic life and revelry, including Village Wedding (1635) and Flemish Feast in an Inn (1674). Noun 1. Production Service. The combined engineering businesses had total contract revenue growth of 13 percent and an increase in operating income of 185 percent. The segments of Civil and Transportation engineering and architectural services each recorded revenue gains in excess of 16 percent, except for the Environmental market segment which declined $2.7 million. Consolidated net income in the current quarter benefited from a $0.2 million other income pre-tax gain on the sale of equipment and a year to date adjustment of the income tax rate from 47 percent to 46 percent. During the third quarter, the company reclassified its $4.5 million litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. reserve for ADF (1) (Application Development Facility) An IBM programmer-oriented mainframe application generator that runs under IMS. (2) (Automatic Document Feeder) A paper stacker that feeds one sheet of paper at a time into the unit. as a current liability since the trial was substantially complete. At September September: see month. 30, 2000, total backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. for the company's ongoing businesses was $459 million compared to $417 million for these same businesses at year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. 1999. Commenting on the results, Donald P. Fusilli fu·sil·li n. Pasta in short spirals or corkscrews. [Italian, from pl. diminutive of fuso, spindle, from Latin f  sus.] , Jr., president and
chief operating officer Chief Operating Officer (COO)The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. , said: "We are pleased with these results, particularly the solid performances turned in by our Energy and architectural operations. Our operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: are improving, and we expect continued top and bottom line growth in our core businesses in the fourth quarter and into next year." He added that, "we made significant progress in the third quarter with solidifying so·lid·i·fy v. so·lid·i·fied, so·lid·i·fy·ing, so·lid·i·fies v.tr. 1. To make solid, compact, or hard. 2. To make strong or united. v.intr. our new management team and operating structure. Going forward, our strategy is to remain focused, identify means to leverage the numerous opportunities available to us in our core businesses, and create new ways to deliver value to our clients and shareholders." In conclusion, Richard L. Shaw, chairman and chief executive officer, said that it has been a little more than one year since the company implemented its strategy for resolving its litigation with Universal, streamlining its operations and focusing on the businesses that it could manage successfully. "I am pleased that we have settled with Universal, sold BSSI, and wound down our Buildings Construction and Heavy and Highway businesses. As evidenced by our financial results, our core business focus is functioning very well." He ended by saying that the subcontractor One who takes a portion of a contract from the principal contractor or from another subcontractor. When an individual or a company is involved in a large-scale project, a contractor is often hired to see that the work is done. claim related to Universal with ADF is progressing. The trial portion of the claim was completed in early October, and attorneys for both parties will file briefs by early November. A ruling by the judge could occur by the end of the year. Michael Baker Corporation (www.mbakercorp.com) provides engineering and energy expertise for public and private sector clients worldwide. The firm's primary services include facilities design, engineering design for the transportation and civil infrastructure markets, operation and maintenance of oil and gas production facilities, and construction management for building and highway projects. Baker employs more than 3,200 in over 30 offices across the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. 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 anticipated levels of government spending Government spending or government expenditure consists of government purchases, which can be financed by seigniorage, taxes, or government borrowing. It is considered to be one of the major components of gross domestic product. on infrastructure; and changes in loan relationships or sources . Such forward looking statements are made pursuant to the Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995.)
Financial Summary
(Unaudited, amounts in thousands except earnings per share)
Third Quarter Operating Results 2000 1999
--------------------------------- ---- ----
Total contract revenues $ 92,351 $ 129,790
Gross profit $ 13,521 $ 6,158
Income/(loss) from operations $ 4,006 $ (5,434)
Income/(loss) before taxes $ 4,193 $ (5,438)
Net income/(loss) $ 2,344 $ (4,017)
Basic weighted average shares outstanding 8,203 8,177
Basic net income/(loss) per share $ 0.29 $ (0.49)
Diluted net income/(loss) per share $ 0.28 $ (0.49)
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Nine Month Operating Results 2000 1999
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Total contract revenues $ 298,407 $ 378,974
Gross profit $ 42,607 $ 35,502
Income/(loss) from operations $ 11,777 $ (781)
Income/(loss) before taxes $ 12,227 $ (1,121)
Net income/(loss) $ 6,603 $ (1,729)
Basic weighted average shares outstanding 8,194 8,173
Basic net income/(loss) per share $ 0.81 $ (0.21)
Diluted net income/(loss) per share $ 0.80 $ (0.21)
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Backlog At 9/30/00 At 12/31/99
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Total(a) $ 458,700 $ 417,100
Funded (Engineering) $ 193,700 $ 204,000
(a) Excludes Construction Businesses and Baker Support Services,
which have either been wound down or sold.
Condensed Balance Sheet At 9/30/00 At 12/31/99
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ASSETS
Cash and cash equivalents $ 4,085 $ 3,685
Receivables 70,012 77,964
Costs in excess of billings 21,030 20,803
Prepaid expenses and other 5,910 7,363
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Total current assets 101,037 109,815
Property, plant and equipment, net 11,589 17,120
Goodwill and other intangible assets, net 11,151 14,563
Other assets 3,530 7,693
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Total assets $ 127,307 $ 149,191
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LIABILITIES & SHAREHOLDERS' EQUITY
Accounts payable and short-term debt $ 24,345 $ 32,388
Accrued compensation and insurance 16,115 18,346
Other accrued expenses 31,438 19,453
Billings in excess of costs 2,848 13,555
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Total current liabilities 74,746 83,742
Long-term debt 67 14,867
Other 851 5,783
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Total liabilities 75,664 104,392
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Common Stock and Series B Common Stock 8,530 8,485
Additional paid-in capital 37,283 37,084
Retained earnings 7,883 1,283
Less - Treasury shares (2,053) (2,053)
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Total shareholders' investment 51,643 44,799
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Total liabilities & S/H investment $ 127,307 $ 149,191
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