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Engineering & Energy

MICHAEL BAKER CORPORATION2002 Annual Shareholders Meeting

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Engineering & EnergySafe HarborSafe Harbor

This presentation will contain information related to events which may occur in the future. These

forward-looking statements may include future business trends, revenue and earnings forecasts,

and acquisition and corporate finance activity. These statements are subject to market, regulatory, operating and other risks and uncertainties and, as

a result, actual results may vary. Such forward-looking statements are made pursuant to the safe

harbor provisions of the Private Securities Litigation Reform Act of 1995.

This presentation will contain information related to events which may occur in the future. These

forward-looking statements may include future business trends, revenue and earnings forecasts,

and acquisition and corporate finance activity. These statements are subject to market, regulatory, operating and other risks and uncertainties and, as

a result, actual results may vary. 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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Engineering & Energy

Financial Review: 2001

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Engineering & EnergyTotal Revenues

$390.7$403.2

$506.0

$401.8

$348.7

$281.9

$0

$100

$200

$300

$400

$500

$600

1999 2000 2001

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Revenues Engineering Energy

$80.2$120.7

$201.7 $228.0

$158.2

$243.6

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Engineering & EnergyIncome from Operations

$17.5

$31.4

-$0.5

$31.4

$26.1

$18.8

-$5

$0

$5

$10

$15

$20

$25

$30

$35

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Total Reported Engineering Energy

1999 2000

$5.5

$13.4

$9.3

$16.8

(Pre-Corp. O/H and I/C Ins. Premiums)

2001

$12.8

$18.6

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Engineering & EnergyOperating Performance(in Thousands of $)

Operating Performance(in Thousands of $)

Adjusted for $1 Million Non-Recurring ChargeAdjusted for $1 Million Non-Recurring Charge

1999 2000 2001TOTAL CONTRACT REVENUES

Total Reported $506,012 $390,710 $403,222Less Non-Core 223,236 41,625 1,372

ENERGY 80,158 120,708 158,236ENGINEERING 202,618 228,377 243,614

Total Core 282,776 349,085 401,850

TOTAL OPERATING INCOME (Pre-Corp. O/H and I/C Ins. Premiums)Total Reported (511) 17,543 31,436% -.1% 4.5% 7.8%

ENERGY 4,252 9,759 12,842% 6.6% 8.1% 8.1%ENGINEERING 12,544 16,007 18,582% 6.2% 7.0% 7.6%

Total Core $17,796 $25,766 $31,424% 6.4% 7.4% 7.8%

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Engineering & EnergyBalance Sheet(in millions of $)

Balance Sheet(in millions of $)

1999 2000 2001ASSETSCash $3.7 $9.1 $18.5Short-Term Investment - 9.0 -A/R 77.4 67.7 67.6Cost in Excess of Billing 26.6 20.5 25.3

PPE 17.1 10.1 10.3Intangibles 14.6 10.8 9.8Other 15.6 10.2 20.1

$155.0 $137.4 $151.6LIABILITIESCurrent Portion LTD 3.5 2.2 -Trade A/P 28.9 25.7 21.9Accrued Other 62.9 59.1 68.2

Long-Term Debt 14.9 0.1 -

Owners’ Equity 44.8 50.3 61.5$155.0 $137.4 $151.6

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Engineering & EnergyCash Flow(in millions of $)

Cash Flow(in millions of $)

1999 2000 2001Net Income $(8.2) $5.4 $11.2

Depreciation & Amortization 7.4 7.1 5.2Other 1.9 (0.1) 3.2

Cash from Operations 1.1 12.4 19.6

Capital Expenditures (5.3) (2.9) (4.1)Acquisition/Investments (4.9) (9.0) 9.0Funding of Litigation Escrow - - (12.7)Share Repurchase - - (0.4)Proceeds from Sale of Assets/Stock Options - 15.0 0.3NET Borrowings (Repayments) 7.8 (10.1) (2.3)

NET Increase (Decrease) in Cash $(1.3) $5.4 $9.4

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Engineering & EnergyEPS GrowthEPS Growth

1999 2000 2001Reported

EPS $(1.00) $.65 $1.33

Pro Forma EPSCore Operating Income 17,796 25,766 31,424Less Corporate Overhead (7,664) (7,715) (11,058)Operating Income 10,132 18,051 20,366

Provisions for Income Tax (47% for 1999, 51% for 2001 and 45.5% for 2001) 4,764 (9,206) (9,267)

5,370 8,845 11,099

Pro Forma EPS $0.66 $1.07 $1.32

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Engineering & Energy

Financial Review:1st QTR 2002

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Engineering & EnergyTotal Revenues (1st QTR)

$95.0$95.9

$108.3

$0

$25

$50

$75

$100

$125

2000 2001 2002

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Revenues Engineering Energy

$25.6

$57.6

$37.5

$57.0

$37.6

$58.3

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Engineering & EnergyIncome from Operations (1st QTR)

$3.9

$3.2

$4.5

$0.0

$1.0

$2.0

$3.0

$4.0

$5.0

2000 2001 2002

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Income Engineering Energy

$1.2

$2.8

$2.1

$2.2 $2.8

$0.9

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Engineering & EnergyOperating Margins (1st QTR)

3.6%

4.7%

3.3%

4.9%

4.0%

4.8%4.7%

5.9%

2.4%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

2000 2001 2002

%

Consolidated Engineering Energy

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Engineering & EnergyStock Performance (24 mos.)Stock Performance (24 mos.)

$5.38

$15.14

$14.25$14.00

$15.00$15.20

$13.60$13.38

$12.26

$12.70

$14.00

$13.85

$6.50

$6.50

$6.69$7.13

$7.75

$8.06

$10.00

$11.55

$7.75

$8.25

$8.30

$8.93$8.13

$0.00

$2.00

$4.00

$6.00

$8.00

$10.00

$12.00

$14.00

$16.00

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Engineering & Energy2001 Financial Highlights

Eliminated Series B Super Voting Shares

Secured $40 Million Credit Facility

Added 7 New Institutional Holders 1.3 Millions Shares

Eliminated Series B Super Voting Shares

Secured $40 Million Credit Facility

Added 7 New Institutional Holders 1.3 Millions Shares

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Engineering & Energy

Operations Review

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Engineering & Energy2001 Highlights

Record Earnings Share Price Increase Energy Growth and Profitability Engineering Steady Improvement Credit Facility B Series Elimination Energy OPCOSM Value-Added Model Engineering Market Initiatives Segment Leverage

Record Earnings Share Price Increase Energy Growth and Profitability Engineering Steady Improvement Credit Facility B Series Elimination Energy OPCOSM Value-Added Model Engineering Market Initiatives Segment Leverage

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Engineering & EnergyVision

Perform Biggest and Most Challenging Projects

Be Paid for Content, Not Hours

Share Knowledge and Resources

Make Money

Perform Biggest and Most Challenging Projects

Be Paid for Content, Not Hours

Share Knowledge and Resources

Make Money

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Engineering & EnergyFour-Point StrategyFour-Point Strategy

Maximize the growth potential of the Energy business

Optimize the overall performance of the Engineering business

Innovate by investing to enhance service delivery methods

Leverage the relationships and skills of the entire company

Maximize the growth potential of the Energy business

Optimize the overall performance of the Engineering business

Innovate by investing to enhance service delivery methods

Leverage the relationships and skills of the entire company

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Engineering & EnergyElements of Success

People

Performance

Profit

People

Performance

Profit

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Engineering & Energy

President’s Award Runner-upEngineering – Rt. 29 Tunnel CM/CI

One-half mile cut and cover tunnel for NJDOT in Trenton, NJ First External CM/CI Contract Awarded in 2000

$9 million, Performance-based Troubled Project Since 1997

Delays Over 2 years Claims totaling $20 million Environmental Clean-up Sites 160 Potential Change Orders

Solutions Centralized Project Records Claims Resolution Process

Global Settlement Package “New Spirit of Project Partnering”

Community Outreach Delivered Project Ahead of Schedule

One-half mile cut and cover tunnel for NJDOT in Trenton, NJ First External CM/CI Contract Awarded in 2000

$9 million, Performance-based Troubled Project Since 1997

Delays Over 2 years Claims totaling $20 million Environmental Clean-up Sites 160 Potential Change Orders

Solutions Centralized Project Records Claims Resolution Process

Global Settlement Package “New Spirit of Project Partnering”

Community Outreach Delivered Project Ahead of Schedule

Biggest and Most Challenging Project

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Engineering & EnergyEngineering – PennDOT Bridge Software

Baker-developed Bridge Analysis, Design and Rating Software Innovative Support and Maintenance Contracting Method

Payments in Advance Quarterly Billing Baker Holds Exclusive Licensing Agreement to Source Code Baker Usage Requires No License

Baker-developed Bridge Analysis, Design and Rating Software Innovative Support and Maintenance Contracting Method

Payments in Advance Quarterly Billing Baker Holds Exclusive Licensing Agreement to Source Code Baker Usage Requires No License

Be Paid for Content, Not Hours

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Engineering & Energy

Energy – SMARTSM Compliance Management System

Heightened Focus on HSE&C Standards and Performance Implemented SMARTSM Compliance Management System in GOM Reduced INCs by 50-65% in 2001 Significant Cost Savings to Clients

Heightened Focus on HSE&C Standards and Performance Implemented SMARTSM Compliance Management System in GOM Reduced INCs by 50-65% in 2001 Significant Cost Savings to Clients

Be Paid for Content, Not Hours

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Engineering & EnergyEngineering – USARAK Equipment Inventory

Client – U.S. Army Alaska (USARAK) Commercial Activities Study at 3 Locations

Fort Wainwright Fort Richardson Seward

Prepare for Privatization of O&M Programs Project Team from Multiple Offices

Anchorage Coraopolis Beaver Elmsford Fairbanks Merrillville

Communication, Coordination, Information Sharing Key to Success

Client – U.S. Army Alaska (USARAK) Commercial Activities Study at 3 Locations

Fort Wainwright Fort Richardson Seward

Prepare for Privatization of O&M Programs Project Team from Multiple Offices

Anchorage Coraopolis Beaver Elmsford Fairbanks Merrillville

Communication, Coordination, Information Sharing Key to Success

Share Knowledge & Resources

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Engineering & EnergyEnergy – Applied Technologies

Significant Growth Opportunities in 2001 Aberdeen Proving Ground CMMS BP Deepwater CMMS BP Grangemouth/Hull Refinery

BP Center of Expertise

Added 62 People 50% Revenue Growth / 17% Margins

Significant Growth Opportunities in 2001 Aberdeen Proving Ground CMMS BP Deepwater CMMS BP Grangemouth/Hull Refinery

BP Center of Expertise

Added 62 People 50% Revenue Growth / 17% Margins

Make Money

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Engineering & Energy

President’s Award Runner-upFunctional – Support Services Group

Travel, Fleet and Mail Services Travel

3rd Largest Expenditure in 2000 - $8.5 million Created Corporate Travel Department (CTD) Saved $1.5 Million in 7 Months Service Provided on September 11

Mail Established Monthly Postage Account for All Offices Web-based iShip for Packages

Available in Beaver & Coraopolis Reduce Shipping Costs 33% All Offices in 2002

Fleet Bid Process for Purchases & Leases Short-Term Agreement with Enterprise Fuel and Maintenance Costs

Total Cost Savings in 2001 - $1.8 million

Travel, Fleet and Mail Services Travel

3rd Largest Expenditure in 2000 - $8.5 million Created Corporate Travel Department (CTD) Saved $1.5 Million in 7 Months Service Provided on September 11

Mail Established Monthly Postage Account for All Offices Web-based iShip for Packages

Available in Beaver & Coraopolis Reduce Shipping Costs 33% All Offices in 2002

Fleet Bid Process for Purchases & Leases Short-Term Agreement with Enterprise Fuel and Maintenance Costs

Total Cost Savings in 2001 - $1.8 million

Make Money

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Engineering & Energy2002 Focus

Balanced Scorecard Planning

Training

Branding the Baker Identity

Acquisitions

Tax Reduction

Balanced Scorecard Planning

Training

Branding the Baker Identity

Acquisitions

Tax Reduction

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Engineering & Energy2002 Growth & Profitability

Grow OPCO Model (Organically and Acquisition)

Chase Customers – Not Projects (Marketing Method)

Expand Engineering U.S. Domestic Geographic Presence

Expand Water/Wastewater Treatment Capability

Build on Leading Maximo MMS Developer for both Public and Private Facilities

Grow OPCO Model (Organically and Acquisition)

Chase Customers – Not Projects (Marketing Method)

Expand Engineering U.S. Domestic Geographic Presence

Expand Water/Wastewater Treatment Capability

Build on Leading Maximo MMS Developer for both Public and Private Facilities

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Engineering & Energy2002 Growth & Profitability

Develop New Generation Web-Enabled Competency-based Training for O&G Clients Worldwide

Extend Environmental Capabilities Internationally Leveraging Energy’s Relationships and Geographic Presence

Build on Long-standing Alaskan Presence to Extend Energy’s O&M Skills into Local Market

Develop New Generation Web-Enabled Competency-based Training for O&G Clients Worldwide

Extend Environmental Capabilities Internationally Leveraging Energy’s Relationships and Geographic Presence

Build on Long-standing Alaskan Presence to Extend Energy’s O&M Skills into Local Market

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Engineering & EnergyConclusion

PASSIONCOMMITMENT

CHANGESPEED

PASSIONCOMMITMENT

CHANGESPEED

MAKE MONEYMAKE MONEY

Energy Engineering

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Engineering & Energy

MICHAEL BAKER CORPORATION2002 Annual Shareholders Meeting

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