8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported) November 4, 2010  

MICHAEL BAKER CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

Pennsylvania
(State or Other Jurisdiction of Incorporation)

1-6627	25-0927646
(Commission File Number)	(IRS Employer Identification No.)

100 Airside Drive
Moon Township, Pennsylvania	15108
(Address of Principal Executive Offices)	(Zip Code)

(412) 269-6300
(Registrant’s Telephone Number, Including Area Code)

(Former Name or Former Address, if Changed Since Last Report)

     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

On November 4, 2010, Michael Baker Corporation (the “Company”) issued a press release reporting, among other things, the Company’s financial results for the quarter ended September 30, 2010. A copy of this press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated into this Item 2.02 by reference.

In accordance with General Instruction B.2 of Form 8-K, the information furnished pursuant to this Item 2.02 in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

The following exhibit is furnished with this report on Form 8-K:

Exhibit No.		Description
	99.1	Press release dated November 4, 2010.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

MICHAEL BAKER CORPORATION
By:	/s/ Michael J. Zugay
	Michael J. Zugay
	Executive Vice President and Chief Financial Officer

Date: November 4, 2010

EXHIBIT INDEX

Number		Description	Method of Filing
	99.1	Press release dated November 4, 2010.	Filed herewith.

EX-99.1

Exhibit 99.1

N e w s   R e l e a s e

Contact:	David Higie
Phone:	(412) 269-6449
Release:	Immediate (Nov. 4, 2010)

BAKER ANNOUNCES FINANCIAL RESULTS FOR THIRD QUARTER AND FIRST NINE MONTHS OF 2010

     PITTSBURGH — Michael Baker Corporation (NYSE Amex:BKR) today reported its financial results for the third quarter and first nine months of 2010.

     As reported earlier, the Company acquired The LPA Group Inc. on May 3, 2010, and these financial results include LPA’s results from that date through September 30, 2010. In addition, in 2009 the Company sold its former Energy business and, as a result of this disposition, the financial results of the former Energy segment have been reclassified as discontinued operations for all periods presented in the consolidated financial statements. The information contained in this news release pertains to Baker’s continuing operations, while the Company’s Form 10-Q, which is being filed with the SEC concurrent with this announcement, presents a complete discussion of both continuing and discontinued operations.

     For the quarter, Baker reported income from continuing operations of $5.0 million, or $0.54 per diluted share, on total contract revenues of $135.6 million. This compares to income from continuing operations of $7.0 million, or $0.78 per diluted share, on total contract revenues of $110.2 million in the third quarter of 2009. The 23 percent increase in revenues is driven primarily by $23.4 million in revenues from LPA and increases in revenue from other key Transportation projects, which was offset by a seven percent decrease in revenues from the Federal segment. The decline in Federal segment revenues results from a $3.2 million decrease in work performed for the Company’s unconsolidated subsidiary in Iraq, and a net decrease of $2.9 million in work performed for FEMA, compared to the third quarter of 2009. The decrease in income from continuing operations is attributable primarily to the aforementioned decreases in work performed in Iraq and for FEMA, a reduction in equity income from unconsolidated subsidiaries of $3.0 million resulting primarily from the decline of work in Iraq, and $1.4 million of amortization expense for intangible assets related to the LPA acquisition. This decline was partially offset by the addition of LPA’s margin and higher Transportation revenue volume compared to 2009, as well as a decrease in incentive compensation costs of $1.7 million.

     Operating income from continuing operations before corporate overhead allocations in the Transportation business segment was $7.9 million, an 84 percent increase compared to the third quarter of 2009. This is due primarily to increased revenue volume and margin improvements in the current period and the addition of LPA’s margin, offset by amortization of $1.8 million for intangible assets related to the LPA acquisition. Operating income from continuing operations before corporate overhead allocations in the Federal segment for the third quarter of 2010 was $6.3 million, a decrease of 34 percent compared to the third-quarter 2009. This decline is mainly attributable to lower revenue volume and margin, including a net decrease in project incentive awards of $1.2 million. Overall, operating income before corporate overhead allocations was impacted favorably by decreases in incentive compensation costs in both business segments.

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ADD ONE — BAKER FINANCIAL RESULTS FOR THIRD QUARTER 2010

     Selling, General and Administrative expenses totaled $22.5 million for the third quarter of 2010, compared to $14.7 million for the third quarter of 2009. This increase relates primarily to additional SG&A expenses of $5.5 million from LPA, which was partially offset by a reduction in incentive compensation accruals.

     Total backlog for continuing operations at September 30, 2010, was $1.6 billion, compared to $1.4 billion at December 31, 2009. Of these totals, $566 million and $461 million, respectively, are considered funded backlog. Included in funded backlog at September 30, 2010, was $104 million from LPA. Also included in funded backlog at September 30, 2010, was $31 million related to the Company’s FEMA Risk MAP Program and $15 million related to the FEMA Map Modernization Program.

     On the balance sheet as of September 30, 2010, the Company had cash and investment balances of $86 million and no debt.

     For the first nine months of 2010, the Company reported income from continuing operations of $15.2 million, or $1.67 per diluted share, on total contract revenues of $379 million, compared with income from continuing operations of $18.7 million, or $2.10 per diluted share, on total contract revenues of $339 million in the first nine months of 2009. Year to date, the amortization expense for intangible assets related to the LPA acquisition is $3.0 million.

     The full-year forecasted effective income tax rate from continuing operations was 39.0 percent at September 30, 2010 and 2009, respectively.

     Commenting on the results, President and Chief Executive Officer Bradley L. Mallory said, “In spite of a difficult funding environment, we were able to beat back the headwinds facing our Transportation segment during the third quarter. And even though we were able to grow certain areas of our Federal business, it wasn’t enough to overcome the slower than expected ramp up and cuts in our FEMA work, and the lack of work in Afghanistan to replace our work in Iraq. We remain committed to resolving these operational challenges and executing on our acquisition strategy.”

     Michael Baker Corporation (www.mbakercorp.com) provides architecture, engineering and construction services for its clients’ most complex challenges worldwide. The firm’s primary business areas are aviation, defense, environmental, facilities, geospatial, homeland security, municipal & civil, pipelines & utilities, rail & transit, transportation and water. With more than 2,900 employees in nearly 90 offices across the United States, Baker is focused on creating value by delivering innovative and sustainable solutions for infrastructure and the environment.

Conference Call

     Michael Baker Corporation has scheduled a conference call and webcast for Thursday, November 4, at 10:00 a.m. EDT, to discuss the third quarter and first nine months’ results. Please call 877-769-6805 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.

(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; changes in information systems, and acquisition-related activity. Such forward-looking statements are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995.)

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ADD TWO — BAKER FINANCIAL RESULTS FOR THIRD QUARTER 2010

FINANCIAL SUMMARY
(Unaudited)

	For the three months					For the nine months
Operating Results	ended September 30,					ended September 30,
(In thousands, except earnings per share)	2010			2009		2010			2009
Revenues	$	135,573		$	110,153	$	378,989		$	338,560
Gross profit		30,262			22,239		80,379			67,605
Operating Income		7,763			7,523		23,025			23,648
Income before noncontrolling interest and income taxes		8,390			10,919		25,349			30,129
Net income from continuing operations attributable to Michael Baker Corporation		5,031			6,957		15,201			18,713
(Loss)/income from discontinued operations		(682	)		321		(1,478	)		3,453
Net income attributable to Michael Baker Corporation	$	4,349		$	7,278	$	13,723		$	22,166
Earnings per share:
Basic-continuing operations	$	0.56		$	0.78	$	1.70		$	2.12
Diluted-continuing operations		0.54			0.78		1.67			2.10
Basic-net income		0.49			0.82		1.54			2.51
Diluted-net income	$	0.47		$	0.81	$	1.51		$	2.48

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ADD THREE — BAKER FINANCIAL RESULTS FOR THIRD QUARTER 2010

Segment results (Unaudited)
(In millions)	For the three months						For the nine months
	ended September 30,						ended September 30,
	2010			2009			2010			2009
Revenues
Transportation	$	80.1		$	50.3		$	203.6		$	147.1
Federal		55.5			59.9			175.4			191.5
Total revenues	$	135.6		$	110.2		$	379.0		$	338.6
Gross Profit
Transportation	$	18.6		$	9.4		$	43.3		$	26.5
Federal		12.2			13.0			38.0			41.8
Corporate		(0.5	)		(0.2	)		(0.9	)		(0.7	)
Total gross profit		30.3			22.2			80.4			67.6
Less: SG&A
Transportation		(14.4	)		(8.0	)		(33.0	)		(22.2	)
Federal		(8.1	)		(6.7	)		(24.3	)		(21.7	)
Corporate		—			—			(0.1	)		(0.1	)
Total SG&A		(22.5	)		(14.7	)		(57.4	)		(44.0	)
Total income/(loss) from operations
Transportation		4.2			1.4			10.3			4.3
Federal		4.1			6.3			13.7			20.1
Corporate		(0.5	)		(0.2	)		(1.0	)		(0.8	)
Total operating income	$	7.8		$	7.5		$	23.0		$	23.6

Backlog	As of
(In millions)	September 30,		December 31,
	2010		2009
Funded	$	566.1	$	461.3
Unfunded		1,018.8		963.9
Total	$	1,584.9	$	1,425.2

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ADD FOUR — BAKER FINANCIAL RESULTS FOR THIRD QUARTER 2010

Condensed Balance Sheet	As of
(In thousands)	September 30,			December 31,
	2010			2009
ASSETS
Cash and cash equivalents	$	75,619		$	105,259
Short term investments and available for sale securities		10,731			4,655
Proceeds receivable — Energy sale		—			9,965
Receivables, net		81,342			76,455
Unbilled revenues on contracts in progress		62,940			49,605
Prepaid expenses and other		7,175			5,407
Total current assets		237,807			251,346
Property, plant and equipment, net		17,133			12,578
Goodwill and other intangible assets, net		69,513			9,702
Other long-term assets		5,987			5,218
Total assets	$	330,440		$	278,844
LIABILITIES & SHAREHOLDERS’ INVESTMENT
Accounts payable	$	42,425		$	31,948
Accrued compensation and insurance		35,974			32,576
Billings in excess of revenues on contracts in progress		21,102			19,102
Other accrued expenses		18,291			13,363
Total current liabilities		117,792			96,989
Other long-term liabilities		15,393			8,115
Total liabilities		133,185			105,104
Common Stock		9,718			9,403
Additional paid-in capital		59,163			49,989
Retained earnings		132,858			119,135
Accumulated other comprehensive loss		(315	)		(333	)
Less — Treasury shares		(4,761	)		(4,761	)
Total Michael Baker Corporation shareholders’ investment		196,663			173,433
Noncontrolling interests		592			307
Total shareholders’ investment		197,255			173,740
Total liabilities & shareholders’ investment	$	330,440		$	278,844

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