PITTSBURGH — Michael Baker Corporation announced its financial results for the first quarter of 2013, including significant increases in net income and earnings per share compared to the first quarter of 2012. In addition, the Company’s Board of Directors declared an $0.18 per share dividend for the second quarter of 2013, payable on July 2 to shareholders of record on June 12. This represents a $0.02 per share increase from the dividend paid for the first quarter of 2013.
For the quarter, Baker reported net income of $5.5 million, or $0.57 per diluted share, on revenues of $144.0 million, compared to net income of $1.7 million, or $0.18 per diluted share, on revenues of $151.7 million in the first quarter of 2012.
The substantial improvement in first-quarter 2013 net income and earnings per share resulted from increases in both of the Company’s business segments’ operating income. This was due mainly to the timing of revenue recognition on certain projects in the Transportation segment, which contributed $3.0 million, higher utilization, a decrease in acquisition-related intangible asset amortization expenses, and a $3.3 million reduction in selling, general and administrative costs primarily related to the performance improvement plan. These factors were partially offset by the decrease in revenue in the first quarter of 2013, which resulted primarily from a decrease in work performed for the Department of Defense and declines in work performed for certain key Transportation clients. The 2012 first quarter benefitted from the favorable impact of a recovery of $1.1 million related to claims due from a professional liability insurer that is in liquidation.
Selling, general and administrative expenses expressed as a percentage of revenue were 13.3 percent for the current period compared to 14.8 percent for the first quarter of 2012. This decrease is primarily attributable to the period-over-period decrease in SG&A personnel and a general reduction in overhead expenses.
The Company’s effective income tax rate was 39 percent for the first quarter of 2013, compared to 38 percent for the first quarter of 2012. The difference between the effective income tax rate of 39 percent and the tax expenses for 2013 related to a settlement with the IRS for a previous assessment which resulted in a reversal of tax liabilities.
Total backlog at March 31, 2013, was $1.66 billion, compared to $1.65 billion at December 31, 2012. Of these totals, $644 million and $649 million, respectively, are considered funded backlog.
As of March 31, 2013, the Company had cash and investment balances of $79.3 million, compared to $77.4 million at December 31, 2012, and no debt.
Commenting on the results, H. James McKnight and Michael J. Zugay, office of the chief executive, said, “We are pleased with the significant improvement we were able to achieve in the first quarter of 2013. Our revenue, while down from 2012, was in line with our expectations, and our results demonstrate the progress we have made in better aligning our cost structure with the current industry environment. Overall, it is a good start to the year and we are hopeful that this favorable trend in our performance will continue.”