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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 FOR THE FISCAL YEAR ENDED JUNE 30, 2011
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
 COMMISSION FILE NUMBER 001-32582
 PIKE ELECTRIC CORPORATION
 (Exact name of registrant as specified in its charter)
 Delaware
    
    20-3112047(State of incorporation)
    
    (I.R.S. Employer Identification No.)
 100 Pike Way, Mount Airy, NC 27030  (Address of principal executive office)
 (336) 789-2171  (Registrants telephone number, including area code)
 Securities registered pursuant to Section 12(b) of the Act:
 Title of Each Class
    
    Name of Each Exchange on Which RegisteredCommon Stock, par value $0.001
    
    New York Stock Exchange
 Securities registered pursuant to Section 12(g) of the Act:
 Yes o No þ
 Yes o No þ
 Yes þ No o
 Yes o No o
 o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if smaller reporting company)
 Yes o No þ
   DOCUMENTS INCORPORATED BY REFERENCE




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##### 



PIKE ELECTRIC CORPORATION
Annual Report on Form 10-K for the year ended June 30, 2011
Index
 Items
 Part IItem 1. Business
    
    
    1Item 1A. Risk Factors
    
    
    10Item 1B. Unresolved Staff Comments
    
    
    20Item 2. Properties
    
    
    20Item 3. Legal Proceedings
    
    
    20Item 4. Reserved
    
    
    20Part IIItem 5. Market for Registrants Common Equity, Related Stockholder Matters
and Issuer Purchases of Equity Securities
    
    
    21Item 6. Selected Financial Data
    
    
    23Item 7. Managements Discussion and Analysis of Financial Condition and
Results of Operations
    
    
    25Item 7A. Quantitative and Qualitative Disclosures about Market Risk
    
    
    44Item 8. Financial Statements and Supplementary Data
    
    
    45Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
    
    
    79Item 9A. Controls and Procedures
    
    
    79Item 9B. Other Information
    
    
    79Part IIIItem 10. Directors, Executive Officers and Corporate Governance
    
    
    79Item 11. Executive Compensation
    
    
    80Item 12. Security Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters
    
    
    80Item 13. Certain Relationships and Related Transactions, and Director
Independence
    
    
    80Item 14. Principal Accounting Fees and Services
    
    
    80Part IVItem 15. Exhibits, Financial Statement Schedules
    
    
    80Signatures
    
    
    81Exhibit 3.2Exhibit 21.1Exhibit 23.1Exhibit 31.1Exhibit 31.2Exhibit 32.1




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PART I
 
 ITEM 1.
    
    BUSINESS
 Overview
     1




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Service
    
    Revenue Category
    
    DescriptionPlanning & Siting
    
    Engineering and Substation
    
    Our planning and siting process leverages
technology and the collection of
environmental, cultural, land use and
scientific data to facilitate successful
right-of-way negotiations and permitting for
powerlines, substations, pipelines and
renewable energy installations.Engineering & Design
    
    Engineering and Substation
    
    We provide design, EPC, owner engineer,
project management, multi-entity coordination,
grid integration, balance-of-plant (BOP) and
Thermal Rate solutions for individual or
turnkey powerline, substation and renewable
energy projects.Transmission and
Distribution Construction
    
    Overhead Distribution and
Other, Underground
Distribution and
Transmission
    
    We provide overhead and underground powerline
construction, upgrade and extension services
(predominately single-pole and H-frame wood,
concrete or steel poles) for distribution
networks and transmission lines with voltages
up to 345 kV, energized maintenance work for
voltages up to 500kV.Overhead services consist of construction,
repair and maintenance of wire and components
in energized overhead electric distribution
and transmission systems.Underground services range from simple
residential installations, directional boring,
duct bank and manhole installation, to the
construction of complete underground
distribution facilities.Substation Construction
    
    Engineering and Substation
    
    We provide substation construction and service.Substation services include: construction of
new substations, existing substation upgrades,
relay testing, commissioning, emergency outage
response and Smart Grid component
installation.Renewables
    
    Depending on project, can
be any type of core
revenue
    
    We provide a total energy solution platform,
including preliminary studies, planning,
siting and permitting, engineering and design,
construction, procurement and grid
interconnection.Storm Restoration Services
    
    Storm Restoration Services
    
    Storm restoration involves the repair or
reconstruction of any part of a distribution
or sub-500 kV transmission network, including
substations, power lines, utility poles or
other components, damaged during snow, ice or
wind storms, flash floods, hurricanes,
tornadoes or other natural disasters. We are a
recognized leader in storm restoration, due to
our ability to rapidly mobilize thousands of
existing employees and equipment within 24
hours, while maintaining a functional force
for unaffected customers.
  2




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Industry Overview
   Required Future Investment in Transmission and Distribution Infrastructure .
 Expanded Development of Energy Sources
 Increased Outsourcing of Infrastructure Services
 Our Growth Strategy
  Leverage Existing Customer Relationships to Cross-Sell Our Services.
  3




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Capitalize Upon the Substantial Expected Spend in Our Markets.
 Strong Platform to Participate in the Continued Consolidation of the Energy Solutions Market
in the United States.
  
    
    in September 2008, we acquired Shaw Energy Delivery Services, Inc., which
expanded our operations into engineering, design, procurement and construction
management services, including in the renewable energy arena, significantly
enhanced our substation and transmission construction capabilities, and further
extended our geographic presence across the United States;
    
    in June 2009, we acquired Facilities Planning & Siting, PLLC, which allows us to
provide siting and planning services to our customers which positions us to be
involved at the conceptual stage of their projects;
    
    in June 2010, we acquired Klondyke, which expanded our construction capabilities
into the Southwest United States and provides us the capability to provide EPC
services to our customers in the Western United States and to compete in unionized
labor markets; and
    
    in August 2011, we acquired Pine Valley, which expanded our construction
capabilities into the Western United States and, when coupled with Klondyke,
provides us depth and experience in the T&D construction market in the Western U.S.
and leverages our EPC offering to our customers.
 Apply our Expertise to International Markets.
  4




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Competitive Strengths
  Leading Provider of Energy Solutions.
 Attractive, Contiguous Presence in Key Geographic Markets.
 Long-Standing Relationships Across a High-Quality Customer Base.
 Outsourced Services-Based Business Model.
 Recognized Leader in Storm Restoration Capabilities
 Storm
    
    
    
    
    
    
    Storm RevenuesFiscal
    
    Restoration
    
    
    Total
    
    
    as a Percentage ofYear
    
    Revenues
    
    
    Revenues
    
    
    Total Revenues(In millions)
    
    
    (In millions)2007
    
    $
    53.2
    
    
    $
    596.8
    
    
    
    8.9
    %2008
    
    $
    49.4
    
    
    $
    552.0
    
    
    
    8.9
    %2009
    
    $
    152.9
    
    
    $
    613.5
    
    
    
    24.9
    %2010
    
    $
    46.6
    
    
    $
    504.1
    
    
    
    9.2
    %2011
    
    $
    64.5
    
    
    $
    593.9
    
    
    
    10.9
    %
  5




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Selected Storm MobilizationsApproximateNumber ofEmployeesStorm (States Affected)
    
    Fiscal Year
    
    
    MobilizedHurricanes / Tropical Storms / OtherApril Tornadoes (TX, OK, AR, LA, MS, AL, GA, TN, KY)
    
    
    2011
    
    
    
    1,750Ike (TX, LA, AR, OH, KY)
    
    
    2009
    
    
    
    2,500Gustav (LA, MS, AL)
    
    
    2009
    
    
    
    1,500Fay (FL, AL, MS)
    
    
    2008
    
    
    
    900Winter StormsFebruary Winter Storm (IN, OH, PA, VA, MD, Dist. of Columbia, LA, TX)
    
    
    2011
    
    
    
    1,200January Winter Storm (VA, WV, Dist. of Columbia, MD)
    
    
    2011
    
    
    
    600Winter Storm (TX, OK, GA, SC, NC, VA, WV, MD, OH, PA)
    
    
    2010
    
    
    
    1,800Winter Storm (KY, NC, VA, TN, WV)
    
    
    2010
    
    
    
    1,350Winter Storm (IN, KY, MO, OH)
    
    
    2009
    
    
    
    2,200Ice Storm (OK)
    
    
    2008
    
    
    
    1,350Ice Storm (MO)
    
    
    2007
    
    
    
    1,500
 Experienced Operations Management Team with Extensive Relationships.
 Types of Service Arrangements
    6




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##### Table of Contents



Seasonality
  Competition
   
    
    diversified services, including the ability to offer turn-key EPC project services;
    
    customer relationships and industry reputation;
    
    responsiveness in emergency restoration situations;
    
    adequate financial resources and bonding capacity;
    
    geographic breadth and presence in customer markets:
    
    pricing of services, particularly under MSA constraints; and
    
    safety concerns of our crews, customers and the general public.
    7




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Customers
  Employees
  Training, Quality Assurance and Safety
   Equipment
     8




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Proprietary Rights
  Risk Management and Insurance
   Government Regulation
   Environmental Matters
   9




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Available Information
 www.pike.com www.sec.gov
 
 ITEM 1A.
    
    RISK FACTORS
 Forward-Looking Statements.
 The economic downturn and instability in the financial markets may adversely impact our
customers future spending as well as payment for our services and, as a result, our operations and
growth
 We derive a significant portion of our revenues from a small group of customers. The loss of
or a significant decrease in services to one or more of these customers could negatively impact our
business, financial condition and results of operations .
  10




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Our customers often have no obligation to assign work to us, and many of our arrangements may
be terminated on short notice. As a result, we are at risk of losing significant business on short
notice .
 Our industry is highly competitive and we may be unable to compete effectively, retain our
customers or win new customers, which could result in reduced profitability and loss of market
share.
 Our storm restoration services are highly volatile and unpredictable, which could result in
substantial variations in, and uncertainties regarding, the levels of our financial results from
period to period.
 We are subject to the risks associated with government construction projects.
   11




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We may incur warranty costs that could adversely affect our profitability.
 We may incur liabilities or suffer negative financial or reputational impacts relating to
occupational health and safety matters.
 Our business is subject to numerous hazards that could subject us to substantial monetary and
other liabilities. If accidents occur, they could materially and adversely affect our business and
results of operations .
 Federal and state legislative and regulatory developments that we believe should encourage
electric power transmission infrastructure spending may fail to result in increased demand for our
services.
   12




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Utilities focus on power generation has and may continue to temporarily divert attention and
capital away from maintenance projects we perform.
 Inability to perform our obligations under EPC and fixed-price contracts may adversely affect
our business.
 Demand for some of our services is cyclical and vulnerable to industry and economic downturns,
which could materially and adversely affect our business and results of operations.
 To be successful, we need to attract and retain qualified personnel, and any inability to do
so would adversely affect our business.
 We are dependent on our senior management and other key personnel, the loss of which could
have a material adverse effect on our business, financial condition and results of operations .
  13




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Our unionized workforce could adversely affect our operations and our ability to complete
future acquisitions. In addition, we contribute to multi-employer plans that could result in
liabilities to us if these plans are terminated or we withdraw .
   We require subcontractors to assist us in providing certain services and we may be unable to
retain the necessary subcontractors to complete certain projects.
 Our current insurance coverage may not be adequate, and we may not be able to obtain insurance
at acceptable rates, or at all.
  Fuel costs could materially and adversely affect our operating results .
  14




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A portion of our business depends on our ability to provide surety bonds or letters of credit
and we may be unable to compete for or work on certain projects if we are not able to obtain the
necessary surety bonds or letters of credit.
  We extend credit to customers for purchases of our services. In the past we have had, and in
the future we may have, difficulty collecting receivables from customers that are subject to
protection under bankruptcy or insolvency laws, are otherwise experiencing financial difficulties
or dispute the amount owed to us .
  Weather conditions can adversely affect our operations and , consequently, revenues . The
electric infrastructure servicing business is subject to seasonal variations, which may cause our
operating results to vary significantly from period to period and could cause the market price of
our stock to fall.
  15




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Our financial results are based upon estimates and assumptions that may differ from actual
results .
 Failure to maintain effective internal control over financial reporting could have a material
adverse effect on our business, operating results and stock price.
 We have incurred indebtedness under a revolving credit facility, which may restrict our
business and operations, and restrict our future access to sufficient funding to finance desired
growth.
     16




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We may be unsuccessful at acquiring companies or at integrating companies that we acquire, and
as a result, we may not achieve the expected benefits and our profitability could materially
suffer.
 During the ordinary course of our business, we may become subject to lawsuits or indemnity
claims, which could materially and adversely affect our business, financial condition and results
of operations .
 Our participation in partnerships or alliances exposes us to liability and/or harm to our
reputation for failures of our partners.
 Our failure to comply with, or the imposition of liability under, environmental laws and
regulations could result in significant costs.
  17




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Our results of operations could be adversely affected as a result of the impairment of
goodwill or other intangibles.
  .
  Risks associated with operating in international markets could restrict our ability to expand
globally and harm our business and prospects, and we could be adversely affected by our failure to
comply with the laws applicable to our foreign activities, including the U.S. Foreign Corrupt
Practices Act and other similar worldwide anti-bribery laws.
  18




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The market price of our stock may be influenced by many factors, some of which are beyond our
control.
 
    
    the failure of securities analysts to continue to cover our common stock or changes in
financial estimates or recommendations by analysts;
 
    
    announcements by us or our competitors of significant contracts, acquisitions or capital
commitments;
    
    changes in market valuation or earnings of our competitors;
    
    variations in quarterly operating results;
    
    availability of capital;
    
    general economic conditions;
    
    terrorist acts;
    
    legislation;
    
    future sales of our common stock; and
    
    investor perception of us and the electric utility industry.
  Shares eligible for future sale may cause the market price of our common stock to drop
significantly, even if our business is doing well.
    19




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The concentration of our capital stock will limit other stockholders ability to influence
corporate matters .
 Anti-takeover provisions of our charter and bylaws may reduce the likelihood of any potential
change of control or unsolicited acquisition proposal that stockholders might consider favorable.
 
 ITEM 1B.
    
    UNRESOLVED STAFF COMMENTS
  
 ITEM 2.
    
    PROPERTIES
  
 ITEM 3.
    
    LEGAL PROCEEDINGS
  
 ITEM 4.
    
    RESERVED
   20




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PART II
 
 ITEM 5.
    
    MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
 Market Information
  Fiscal 2011
    
    
    Fiscal 2010High
    
    
    Low
    
    
    High
    
    
    LowFirst Quarter
    
    $
    9.99
    
    
    $
    6.67
    
    
    $
    12.99
    
    
    $
    10.11Second Quarter
    
    
    9.20
    
    
    
    6.68
    
    
    
    12.99
    
    
    
    8.77Third Quarter
    
    
    10.17
    
    
    
    8.12
    
    
    
    9.85
    
    
    
    8.10Fourth Quarter
    
    
    10.49
    
    
    
    7.90
    
    
    
    11.05
    
    
    
    8.82
  Dividend Policy
  Recent Sales of Unregistered Securities
  Purchases of Equity Securities
  Total Number
    
    
    Approximateof Shares
    
    
    Dollar ValueTotal
    
    
    
    
    
    
    Purchased as
    
    
    of Shares thatNumber of
    
    
    Average
    
    
    Part of
    
    
    May Yet beShares
    
    
    Price Paid
    
    
    Publically
    
    
    PurchsaedPurchased
    
    
    per Share
    
    
    Announced
    
    
    under thePeriod
    
    (1)
    
    
    ($)
    
    
    Program
    
    
    ProgramApril 1 through April 30, 2011
    
    
    1,623
    
    
    $
    9.92
    
    
    
    
    
    
    
    May 1, 2011 through May 31, 2011
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    June 1, 2011 through June 30, 2011
    
    
    791
    
    
    $
    8.66
    
    
    
    
    
    
    
    
 (1)
    
    Represents shares of common stock withheld for income tax purposes in connection
with the vesting of shares of restricted stock issued to certain employees.  21




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Performance Graph
 The following Performance Graph and related information shall not be deemed to be filed
with the Securities and Exchange Commission, nor shall such information be incorporated by
reference into any future filing
under the Securities Act of 1933 or Securities Exchange Act of 1934, each as amended, except
to the extent that we specifically incorporate it by reference into such filing.
   
 6/06
    
    
    6/07
    
    
    6/08
    
    
    6/09
    
    
    6/10
    
    
    6/11Pike Electric Corporation
    
    
    100.00
    
    
    
    116.20
    
    
    
    86.24
    
    
    
    62.56
    
    
    
    48.91
    
    
    
    45.90S&P 500
    
    
    100.00
    
    
    
    120.59
    
    
    
    104.77
    
    
    
    77.30
    
    
    
    88.46
    
    
    
    115.61Russell 2000
    
    
    100.00
    
    
    
    116.43
    
    
    
    97.58
    
    
    
    73.17
    
    
    
    88.89
    
    
    
    122.15Peer Group
    
    
    100.00
    
    
    
    155.67
    
    
    
    138.24
    
    
    
    102.59
    
    
    
    89.29
    
    
    
    105.67
  22




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ITEM 6.
    
    SELECTED FINANCIAL DATA
   Years Ended June 30,2011
    
    
    2010
    
    
    2009
    
    
    2008
    
    
    2007(in thousands, except per share amounts)Statement of Operations Data (1):Core revenues
    
    $
    529,335
    
    
    $
    457,448
    
    
    $
    460,630
    
    
    $
    502,632
    
    
    $
    543,570Storm restoration revenues
    
    
    64,523
    
    
    
    46,636
    
    
    
    152,846
    
    
    
    49,397
    
    
    
    53,267Total revenues
    
    $
    593,858
    
    
    $
    504,084
    
    
    $
    613,476
    
    
    $
    552,029
    
    
    $
    596,837Cost of operations
    
    
    525,915
    
    
    
    456,317
    
    
    
    503,203
    
    
    
    460,325
    
    
    
    499,422Gross profit
    
    
    67,943
    
    
    
    47,767
    
    
    
    110,273
    
    
    
    91,704
    
    
    
    97,415General and administrative expenses
    
    
    57,675
    
    
    
    51,994
    
    
    
    50,248
    
    
    
    41,724
    
    
    
    46,486Loss on sale and impairment of property and equipment
    
    
    751
    
    
    
    1,239
    
    
    
    2,116
    
    
    
    3,043
    
    
    
    1,052Restructuring expenses (2)
    
    
    
    
    
    
    8,945
    
    
    
    
    
    
    
    
    
    
    
    Income (loss) from operations
    
    
    9,517
    
    
    
    (14,411
    )
    
    
    57,909
    
    
    
    46,937
    
    
    
    49,877Other expense (income):Interest expense
    
    
    6,608
    
    
    
    7,908
    
    
    
    9,258
    
    
    
    13,919
    
    
    
    19,799Other, net
    
    
    (55
    )
    
    
    (298
    )
    
    
    (1,552
    )
    
    
    (214
    )
    
    
    (236
    )Total other expense
    
    
    6,553
    
    
    
    7,610
    
    
    
    7,706
    
    
    
    13,705
    
    
    
    19,563Income (loss) before income taxes
    
    
    2,964
    
    
    
    (22,021
    )
    
    
    50,203
    
    
    
    33,232
    
    
    
    30,314Income tax expense (benefit)
    
    
    1,563
    
    
    
    (8,562
    )
    
    
    18,634
    
    
    
    12,983
    
    
    
    11,957Net income (loss)
    
    $
    1,401
    
    
    $
    (13,459
    )
    
    $
    31,569
    
    
    $
    20,249
    
    
    $
    18,357Earnings (loss) per share:Basic
    
    $
    0.04
    
    
    $
    (0.41
    )
    
    $
    0.96
    
    
    $
    0.62
    
    
    $
    0.57Diluted
    
    $
    0.04
    
    
    $
    (0.41
    )
    
    $
    0.94
    
    
    $
    0.60
    
    
    $
    0.55Shares used in computing earnings (loss) per share:Basic
    
    
    33,399
    
    
    
    33,132
    
    
    
    33,023
    
    
    
    32,810
    
    
    
    32,416Diluted
    
    
    33,996
    
    
    
    33,132
    
    
    
    33,741
    
    
    
    33,666
    
    
    
    33,366
 As of June 30,2011
    
    
    2010
    
    
    2009
    
    
    2008
    
    
    2007(in thousands)Balance Sheet Data:Cash and cash equivalents
    
    $
    311
    
    
    $
    11,133
    
    
    $
    43,820
    
    
    $
    11,357
    
    
    $
    1,467Working capital
    
    
    84,342
    
    
    
    73,530
    
    
    
    98,379
    
    
    
    71,413
    
    
    
    64,078Property and equipment, net
    
    
    177,682
    
    
    
    194,885
    
    
    
    222,539
    
    
    
    229,119
    
    
    
    267,740Total assets
    
    
    493,609
    
    
    
    505,378
    
    
    
    548,969
    
    
    
    510,660
    
    
    
    545,497Total current liabilities
    
    
    78,488
    
    
    
    78,532
    
    
    
    77,554
    
    
    
    71,420
    
    
    
    69,906Total long-term liabilities
    
    
    160,732
    
    
    
    177,378
    
    
    
    214,450
    
    
    
    218,288
    
    
    
    279,530Total stockholders equity
    
    
    254,389
    
    
    
    249,468
    
    
    
    256,965
    
    
    
    220,952
    
    
    
    196,061Cash dividend per share of common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
  23




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(1)
    
    Statement of operations data include the results of each acquired operation since the date
of acquisition: Shaw Energy Delivery Services, Inc.  September 1, 2008; Facilities Planning
& Siting, PLLC  June 30, 2009; and, Klondyke Construction LLC  June 30, 2010.(2)
    
    Restructuring expense for fiscal 2010 of $8.9 million relates to the implementation of cost
restructuring measures in distribution operations and support services. The pre-tax
restructuring charge consisted of $1.0 million for severance and other termination benefits
and $7.9 million for the non-cash writedown of fleet and other fixed assets to be disposed.
See Note 4 of Notes to the Consolidated Financial Statements.(3)
    
    Cost of operations includes $3.3 million of costs for the fiscal year ended June 30, 2010
related to the cleanup of certain petroleum-related products on an owned property in Georgia.
The remediation of the site is substantially complete.  24




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ITEM 7.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 The following discussion and analysis of our financial condition and results of
operations should be read in conjunction with our historical consolidated financial statements and
related notes thereto in Item 8  Financial Statements and Supplementary Data The discussion
below contains forward-looking statements that are based upon our current expectations and are
subject to uncertainty and changes in circumstances. Actual results may differ materially from
these expectations due to inaccurate assumptions and known or unknown risks and uncertainties,
including those identified in Risk Factors.
 Overview
  Services
   25




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Service
    
    Revenue Category
    
    DescriptionPlanning & Siting
    
    Engineering and Substation
    
    Our planning and siting process leverages
technology and the collection of
environmental, cultural, land use and
scientific data to facilitate successful
right-of-way negotiations and permitting for
powerlines, substations, pipelines and
renewable energy installations.Engineering & Design
    
    Engineering and Substation
    
    We provide design, EPC, owner engineer,
project management, multi-entity coordination,
grid integration, balance-of-plant (BOP) and
Thermal Rate solutions for individual or
turnkey powerline, substation and renewable
energy projects.Transmission and
Distribution Construction
    
    Overhead Distribution and
Other, Underground
Distribution and
Transmission
    
    We provide overhead and underground powerline
construction, upgrade and extension services
(predominately single-pole and H-frame wood,
concrete or steel poles) for distribution
networks and transmission lines with voltages
up to 345 kV, energized maintenance work for
voltages up to 500kV.Overhead services consist of construction,
repair and maintenance of wire and components
in energized overhead electric distribution
and transmission systems.Underground services range from simple
residential installations, directional boring,
duct bank and manhole installation, to the
construction of complete underground
distribution facilities.Substation Construction
    
    Engineering and Substation
    
    We provide substation construction and service.Substation services include: construction of
new substations, existing substation upgrades,
relay testing, commissioning, emergency outage
response and Smart Grid component
installation.Renewables
    
    Depending on project, can
be any type of core
revenue
    
    We provide a total energy solution platform,
including preliminary studies, planning,
siting and permitting, engineering and design,
construction, procurement and grid
interconnection.Storm Restoration Services
    
    Storm Restoration Services
    
    Storm restoration involves the repair or
reconstruction of any part of a distribution
or sub-500 kV transmission network, including
substations, power lines, utility poles or
other components, damaged during snow, ice or
wind storms, flash floods, hurricanes,
tornadoes or other natural disasters. We are a
recognized leader in storm restoration, due to
our ability to rapidly mobilize thousands of
existing employees and equipment within 24
hours, while maintaining a functional force
for unaffected customers.
  26




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Percentage
    
    
    Storm
    
    
    PercentageFiscal
    
    Core
    
    
    of Total
    
    
    Restoration
    
    
    of Total
    
    
    TotalYear
    
    Revenues
    
    
    Revenues
    
    
    Revenues
    
    
    Revenues
    
    
    Revenues(In millions)
    
    
    
    
    
    
    (In millions)
    
    
    
    
    
    
    (In millions)2007
    
    $
    543.6
    
    
    
    91.1
    %
    
    $
    53.2
    
    
    
    8.9
    %
    
    $
    596.82008
    
    $
    502.6
    
    
    
    91.1
    %
    
    $
    49.4
    
    
    
    8.9
    %
    
    $
    552.02009
    
    $
    460.6
    
    
    
    75.1
    %
    
    $
    152.9
    
    
    
    24.9
    %
    
    $
    613.52010
    
    $
    457.5
    
    
    
    90.7
    %
    
    $
    46.6
    
    
    
    9.3
    %
    
    $
    504.12011
    
    $
    529.3
    
    
    
    89.1
    %
    
    $
    64.5
    
    
    
    10.9
    %
    
    $
    593.8
 Seasonality and Fluctuations of Results
  Inflation
  Basis of Reporting
 Revenues.
  Cost of Operations.
 General and Administrative Expenses.
  27




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Interest Expense.
 Critical Accounting Policies
  Revenue Recognition.
   Allowance for Doubtful Accounts.
 Property and Equipment.
  28




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.
 Valuation of Goodwill and Other Intangible Assets.
     29




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Insurance and Claims Accruals.
  Stock-Based Compensation.
   30




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Results of Operations
  Years Ended June 30,2011
    
    
    2010
    
    
    2009Revenues:Core revenues
    
    $
    529.3
    
    
    
    89.1
    %
    
    $
    457.5
    
    
    
    90.7
    %
    
    $
    460.6
    
    
    
    75.1
    %Storm restoration revenues
    
    
    64.5
    
    
    
    10.9
    %
    
    
    46.6
    
    
    
    9.3
    %
    
    
    152.9
    
    
    
    24.9
    %Total revenues
    
    $
    593.8
    
    
    
    100.0
    %
    
    $
    504.1
    
    
    
    100.0
    %
    
    $
    613.5
    
    
    
    100.0
    %Cost of operations
    
    
    525.9
    
    
    
    88.6
    %
    
    
    456.3
    
    
    
    90.5
    %
    
    
    503.2
    
    
    
    82.0
    %Gross profit
    
    
    67.9
    
    
    
    11.4
    %
    
    
    47.8
    
    
    
    9.5
    %
    
    
    110.3
    
    
    
    18.0
    %General and administrative expenses
    
    
    57.6
    
    
    
    9.7
    %
    
    
    52.0
    
    
    
    10.3
    %
    
    
    50.3
    
    
    
    8.2
    %Loss on sale
and impairment of property and equipment
    
    
    0.8
    
    
    
    0.1
    %
    
    
    1.3
    
    
    
    0.3
    %
    
    
    2.1
    
    
    
    0.4
    %Restructuring expenses
    
    
    
    
    
    
    
    
    
    
    8.9
    
    
    
    1.8
    %
    
    
    
    
    
    
    Income (loss) from operations
    
    
    9.5
    
    
    
    1.6
    %
    
    
    (14.4
    )
    
    
    -2.9
    %
    
    
    57.9
    
    
    
    9.4
    %Interest expense and other
    
    
    6.6
    
    
    
    1.1
    %
    
    
    7.6
    
    
    
    1.5
    %
    
    
    7.7
    
    
    
    1.2
    %Income (loss) before income tax
    
    
    2.9
    
    
    
    0.5
    %
    
    
    (22.0
    )
    
    
    -4.4
    %
    
    
    50.2
    
    
    
    8.2
    %Income tax expense (benefit)
    
    
    1.5
    
    
    
    0.3
    %
    
    
    (8.5
    )
    
    
    -1.7
    %
    
    
    18.6
    
    
    
    3.1
    %Net income (loss)
    
    $
    1.4
    
    
    
    0.2
    %
    
    $
    (13.5
    )
    
    
    -2.7
    %
    
    $
    31.6
    
    
    
    5.1
    %
 Year Ended June 30, 2011 Compared to Year Ended June 30, 2010
 Revenues.
   Years EndedJune 30,Category of Core Revenue
    
    2011
    
    
    2010
    
    
    % ChangeDistribution and other
    
    $
    333.3
    
    
    $
    312.3
    
    
    
    6.7
    %Transmission
    
    
    78.2
    
    
    
    68.8
    
    
    
    13.7
    %Engineering and substation
    
    
    117.8
    
    
    
    76.4
    
    
    
    54.2
    %Total
    
    $
    529.3
    
    
    $
    457.5
    
    
    
    15.7
    %
  31




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Gross Profit.
 General and Administrative Expenses.
 Loss on Sale and Impairment of Property and Equipment .
 Interest Expense and Other, Net.
 Income Tax Benefit or Expense.
  32




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Year Ended June 30, 2010 Compared to Year Ended June 30, 2009
 Revenues.
   Years EndedJune 30,Category of Core Revenue
    
    2010
    
    
    2009
    
    
    % ChangeDistribution and other
    
    $
    312.3
    
    
    $
    353.0
    
    
    
    -11.5
    %Transmission
    
    
    68.8
    
    
    
    52.9
    
    
    
    30.0
    %Engineering and substation
    
    
    76.4
    
    
    
    54.7
    
    
    
    39.6
    %Total
    
    $
    457.5
    
    
    $
    460.6
    
    
    
    -0.7
    %
     33




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##### Table of Contents



Gross Profit.
 
    
    A significantly lower mix of storm restoration revenues for the current year.Our
storm restoration services typically generate a higher profit margin than core services.
During a storm response, our storm-assigned crews and equipment are fully utilized. In
addition, the overtime typically worked on storm events lowers the ratio of fixed costs to
revenue. Storm restoration gross profit margins can vary greatly depending on the
geographic area, customer and amount of overtime worked.
 
    
    Distribution margins. Due to the decline in overall distribution demand, we
experienced compressed margins due to the following: (i) increased level of idle
equipment, (ii) decreased distribution productivity due to the types of projects being
outsourced by our customers, (iii) higher average wage rates as we have retained our most
experienced workers and (iv) increased overhead as a percentage of revenue. Major steps
were taken as part of our restructuring during our fiscal second quarter to better align
our costs with revenue expectations. However, because of the continued reduction of
distribution revenues and intense competition during MSA renewals, our distribution margins
remain under significant pressure.
 
    
    Crew start-up costs.Toward the end of fiscal 2010, we had additions to our
transmission and distribution headcount, which resulted in new crews and caused us to
absorb costs related to the release of certain tools and supplies from inventory and the
acquisition of certain new tools. In addition, we attempt to use excess fleet equipment to
start new crews. Some of this equipment had been idle for several quarters and required
significant repairs and maintenance before being put back into service.
 
    
    Environmental matter.We recognized $3.3 million of costs for the fiscal year ended
June 30, 2010 related to the cleanup of certain petroleum-related products on an owned
property in Georgia. We believe the contamination occurred before we purchased the
property. The remediation of the site is substantially complete.
 General and Administrative Expenses.
 Loss on Sale and Impairment of Property and Equipment .
 Restructuring Expenses.
   34




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Interest Expense.
 Other, Net.
 Income Tax Benefit or Expense.
 Liquidity and Capital Resources
        35




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Changes in Cash Flows: 2011 Compared to 2010
 Year Ended June 30,2011
    
    
    2010(in millions)Net cash provided by operating activities
    
    $
    22.2
    
    
    $
    21.0Net cash used in investing activities
    
    $
    (16.5
    )
    
    $
    (25.1
    )Net cash used in financing activities
    
    $
    (16.5
    )
    
    $
    (28.6
    )
     Changes in Cash Flows: 2010 Compared to 2009
 Year Ended June 30,2010
    
    
    2009(in millions)Net cash provided by operating activities
    
    $
    21.0
    
    
    $
    77.3Net cash (used in) provided by investing activities
    
    $
    (25.1
    )
    
    $
    (45.9
    )Net cash provided by (used in) financing activities
    
    $
    (28.6
    )
    
    $
    1.0
  36




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Capital Expenditures
  EBITDA U.S. GAAP Reconciliation
   37




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Year ended June 30,2011
    
    
    2010(In millions)Net income (loss)
    
    $
    1.4
    
    
    $
    (13.5
    )Adjustments:Interest expense
    
    
    6.6
    
    
    
    7.9Income tax expense (benefit)
    
    
    1.5
    
    
    
    (8.6
    )Depreciation and amortization
    
    
    38.1
    
    
    
    35.7EBITDA
    
    $
    47.6
    
    
    $
    21.5
  Credit Facility
    Contractual Obligations and Other Commitments
  Payment Obligations by Fiscal Year Ended June 30,Total
    
    
    2012
    
    
    2013
    
    
    2014
    
    
    2015
    
    
    2016
    
    
    Thereafter(in millions)Long-term debt obligations (1)
    
    $
    99.0
    
    
    $
    
    
    
    $
    99.0
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Interest payment obligations (2)
    
    
    4.2
    
    
    
    3.8
    
    
    
    0.4
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Operating lease obligations
    
    
    33.5
    
    
    
    8.3
    
    
    
    6.4
    
    
    
    5.9
    
    
    
    4.6
    
    
    
    3.8
    
    
    
    4.5Purchase obligations (3)
    
    
    16.7
    
    
    
    16.7
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Deferred compensation (4)
    
    
    8.3
    
    
    
    
    
    
    
    1.7
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6.6Total
    
    $
    161.7
    
    
    $
    28.8
    
    
    $
    107.5
    
    
    $
    5.9
    
    
    $
    4.6
    
    
    $
    3.8
    
    
    $
    11.1
 
 (1)
    
    Includes only obligations to pay principal, not interest expense. See Note 7 of the
consolidated financial statements for details on our new revolving credit facility closed in
August 2011.  38




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##### Table of Contents



(2)
    
    Represents estimated interest payments to be made on our variable rate debt. All interest
payments assume that principal payments are made as originally scheduled. Interest rates
utilized to determine interest payments for variable rate debt are based upon our current term
loan interest rate and include the impact of our interest rate swaps. For more information,
see Note 7 of the Notes to Consolidated Financial Statements.(3)
    
    Represents purchase obligations related to materials and subcontractor services for customer
contracts.(4)
    
    For a description of the deferred compensation obligation, see Note 16 of the Notes to
Consolidated Financial Statements. Off-Balance Sheet Arrangements
  Letters of Credit
  Performance Bonds and Parent Guarantees
    39




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Recent Accounting Pronouncements
 Presentation of Comprehensive Income
  Accounting for Goodwill and Intangible Assets
  Accounting for Business Combinations
  Disclosures for Fair Value Measurements
 .
   40




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FORWARD-LOOKING STATEMENTS
   
    
    our belief that there are significant opportunities for our business and the services we
provide due to the required future investment in transmission and distribution
infrastructure, the expanded development of energy sources and the increased outsourcing of
infrastructure services;
    
    our belief that our acquisitions of Klondyke and Pine Valley allow us to continue to
expand our EPC services in the Western portion of the United States and better compete in
markets with unionized workforces;
    
    our belief that there is significant demand for first or second generation build-out of
electricity infrastructure in developing countries;
    
    our belief that the markets in developing countries present opportunities for companies,
such as ourselves, with scale, sophistication and size to utilize their skills and
equipment in productive and profitable projects;
    
    our expectation that we will benefit from the development of new sources of electric
power generation;
    
    our belief that growth in our markets will be driven by bundling services and marketing
these offerings to our large and extensive customer base and new customers and that by
offering these services on a turnkey basis, we enable our customers to achieve economies
and efficiencies over traditional unbundled services, which should ultimately lead to an
expansion of our market share across our existing customer base and provide us the
credibility to secure opportunities from new customers;
    
    our belief that the United States power system and network reliability will require
significant future upkeep given the postponement of maintenance spending in recent years
due to the difficult economic conditions, that such upkeep will drive demand for our
services and that our leading position in the markets we service will enable us to
capitalize on increases in demand for our services;
    
    our belief that our existing and potential customers desire a deeper range of service
offerings on an ever-increasing scale and that our broad platform of service offerings will
enable us to acquire additional market share and further penetrate our existing markets;
    
    our belief that our broad platform of service offerings will be attractive to local and
regional firms looking to consolidate with a larger company offering a more diversified and
complete set of services;
    
    our belief that our reputation and experience combined with our broad range of services
allows us to opportunistically bid on attractive international projects and that will be
other large and financially
attractive projects to pursue in international markets over the next few years as developing
regions install or develop their electric infrastructure;
  41




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
    
    our belief that we have a unique and strong competitive position in the markets in which
we operate resulting from a number of factors including: (i) our position as a leading
provider of energy solutions; (ii) our attractive, contiguous presence in key geographic
markets; (iii) our long-standing relationships across a high-quality customer base; (iv)
our outsourced services-based business model; (v) our position as a recognized leader in
storm restoration capabilities; and (vi) our experienced operations management team and
their extensive relationships;
    
    our belief that we are one of only a few companies offering a broad spectrum of energy
solutions that our current and prospective customers increasingly demand;
    
    our belief that our management teams deep industry knowledge, experience and
relationships extend our operating capabilities, improve the quality of our services,
facilitate access to clients and enhance our strong reputation in the industry;
    
    our belief that our customers, especially electric utilities, will expand outsourcing of
utility infrastructure services over time;
    
    our expectation that a substantial portion of our total revenues will continue to be
derived from a limited group of customers given the composition of the investor-owned,
municipal and co-operative utilities in our geographic market;
    
    our belief that we have a favorable competitive position in our markets due in large
part to our ability to execute with respect to the following factors: (i) diversified
services including the ability to offer turn-key EPC project services; (ii) customer
relationships and industry reputation; (iii) responsiveness in emergency restoration
situations; (iv) adequate financial resources and bonding capacity; (v) geographic breadth
and presence in customer markets; and (vi) pricing of services, particularly under MSA
constraints; and (vii) safety concerns of our crews, customers and the general public;
    
    our belief that we are in material compliance with applicable regulatory requirements
and have all material licenses required to conduct our operations;
    
    our expectation that costs to maintain environmental compliance and/or to address
environmental issues will not have a material adverse effect on our results of operations,
cash flows or financial condition;
    
    our belief that our fleet maintenance capabilities, experience and personnel provide us
with a competitive advantage;
    
    our intention to continue to retain any future earnings rather than paying dividends;
    
    our belief that the lawsuits, claims or other proceedings to which we are subject in the
ordinary course of business will not have a material adverse effect on our results of
operation, financial position, or cash flows;
    
    our belief that a significant amount of pent-up demand is building and power system
reliability is being challenged and that we remain well positioned to benefit from a
reacceleration in maintenance spending, which will remain dependent to a large extent on
the health of the economy;
    
    our expectation that current volatility in the capital markets will not have a material
impact on the principal amounts of our cash investments;
    
    our belief that our cash flow from operations, available cash and cash equivalents, and
borrowings available under our credit facility will be adequate to meet our ordinary course
liquidity needs for the foreseeable future and that if we pursue any material acquisitions
in the foreseeable future we may need to finance this activity through additional equity or
debt financing;
  42




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##### Table of Contents




    
    our expectation that our capital expenditures will range from $15 million to $25 million
for the year ended June 30, 2012 and our intention to fund those expenditures from
operating cash flow and available cash and cash equivalents;
    
    our belief that it is unlikely that any material claims will be made under a letter of
credit in the foreseeable future;
    
    our belief that it is unlikely that we will have to fund significant claims under our
surety arrangements in the foreseeable future;
    
    our expectation that certain recent accounting pronouncements will have no material
effect on our consolidated financial statements;
    
    our belief that contamination at our owned property in Georgia occurred before we
purchased the property and that the remediation of the site is
substantially complete;
    
    our expectation that the goodwill recognized in our acquisition of Klondyke will be
amortizable for tax purposes;
    
    our expectation that our ability to satisfy our obligations or to fund planned capital
expenditures will depend on our future performance and our belief that this is subject to a
certain extent on general economic, financial, competitive, legislative, regulatory and
other factors beyond our control;
    
    the possibility that if we fail to comply with the covenants contained in our revolving
credit facility, we may be unable to access the revolving portion of our credit facility
upon which we depend for letters of credit and other short-term borrowings and that this
would have a negative impact on our liquidity and could require us to obtain alternative
short-term financing;
    
    our expectation that our gross profit and operating income (loss) would be negatively
affected if diesel prices rise due to additional costs that we may not fully recover
through increases in prices to customers; and
    
    our expectation that the net amount of the existing losses in
OCI at June 30, 2011 unclassified into net income (loss) over the next
twelve months will be approximately $150,000.
   43




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ITEM 7A.
    
    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Interest Rate Risk
    Diesel Fuel Risk
    Concentration of Credit Risk
   44




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##### Table of Contents



ITEM 8.
    
    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
 PageManagements Report on Internal Control Over Financial Reporting
    
    
    46Report of Independent Registered Public Accounting Firm on:Consolidated Financial Statements
    
    
    47Internal Controls over Financial Reporting
    
    
    48Consolidated Balance Sheets
    
    
    49Consolidated Statements of Operations
    
    
    50Consolidated Statements of Stockholders Equity
    
    
    51Consolidated Statements of Cash Flows
    
    
    52Notes to Consolidated Financial Statements
    
    
    53
  45




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Managements Report on Internal Control Over Financial Reporting
       46




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##### Table of Contents



Report of Independent Registered Public Accounting Firm The Board of Directors
and Stockholders of
Pike Electric Corporation We have audited the accompanying consolidated balance sheets of Pike Electric Corporation as of June 30, 2011 and 2010,
and the related consolidated statements of operations, stockholders equity, and cash flows for each of the three years
in the period ended June 30, 2011. Our audits also included the financial statement schedule listed in the Index at
Item 15(a)(2). These financial statements and schedule are the responsibility of the Companys management. Our
responsibility is to express an opinion on these financial statements and schedule based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United
States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated
financial position of Pike Electric Corporation at June 30, 2011 and 2010, and the consolidated results of its
operations and its cash flows for each of the three years in the period ended June 30, 2011, in conformity with U.S.
generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when
considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the
information set forth therein. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States), Pike Electric Corporations internal control over financial reporting as of June 30, 2011, based on criteria
established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission and our report dated September 6, 2011 expressed an unqualified opinion thereon. /s/ Ernst & Young LLP Greensboro, North Carolina

September 6, 2011  1




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##### Table of Contents



Report of Independent Registered Public Accounting Firm The Board of Directors
and Stockholders of Pike Electric Corporation We have audited Pike Electric Corporations internal control over financial reporting as of June 30, 2011, based on
criteria established in Internal ControlIntegrated Framework issued by the Committee of Sponsoring Organizations of
the Treadway Commission (the COSO criteria). Pike Electric Corporations management is responsible for maintaining
effective internal control over financial reporting, and for its assessment of the effectiveness of internal control
over financial reporting included in the accompanying Managements Report on Internal Control Over Financial Reporting.
Our responsibility is to express an opinion on the companys internal control over financial reporting based on our
audit. We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United
States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether
effective internal control over financial reporting was maintained in all material respects. Our audit included
obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness
exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk,
and performing such other procedures as we considered necessary in the circumstances. We believe that our audit
provides a reasonable basis for our opinion. A companys internal control over financial reporting is a process designed to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles. A companys internal control over financial reporting includes those
policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and
fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that
transactions are recorded as necessary to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance
with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use or disposition of the companys assets that could have
a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may
deteriorate. In our opinion, Pike Electric Corporation maintained, in all material respects, effective internal control over
financial reporting as of June 30, 2011, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States), the consolidated balance sheets of Pike Electric Corporation as of June 30, 2011 and 2010 and the related
consolidated statements of operations, stockholders equity and cash flows for each of the three years in the period
ended June 30, 2011 of Pike Electric Corporation and our report dated September 6, 2011 expressed an unqualified
opinion thereon. /s/ Ernst & Young LLP Greensboro, NC September 6, 2011  2




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##### Table of Contents



PIKE ELECTRIC CORPORATION
 
 CONSOLIDATED BALANCE SHEETS
(in thousands, except par value amounts)
 June 30,2011
    
    
    2010ASSETSCurrent assets:Cash and cash equivalents
    
    $
    311
    
    
    $
    11,133Accounts receivable from customers, net
    
    
    80,902
    
    
    
    64,672Costs and estimated earnings in excess of billings on uncompleted contracts
    
    
    49,266
    
    
    
    50,215Inventories
    
    
    8,338
    
    
    
    6,401Prepaid expenses and other
    
    
    16,044
    
    
    
    9,115Deferred income taxes
    
    
    7,969
    
    
    
    10,526Total current assets
    
    
    162,830
    
    
    
    152,062Property and equipment, net
    
    
    177,682
    
    
    
    194,885Goodwill
    
    
    110,893
    
    
    
    114,778Other intangibles, net
    
    
    38,353
    
    
    
    38,527Deferred loan costs, net
    
    
    2,005
    
    
    
    3,021Other assets
    
    
    1,846
    
    
    
    2,105Total assets
    
    $
    493,609
    
    
    $
    505,378LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    20,079
    
    
    $
    17,484Accrued compensation
    
    
    25,474
    
    
    
    22,589Billings in excess of costs and estimated earnings on uncompleted contracts
    
    
    12,224
    
    
    
    8,925Accrued expenses and other
    
    
    8,185
    
    
    
    6,112Current portion of insurance and claim accruals
    
    
    12,526
    
    
    
    23,422Total current liabilities
    
    
    78,488
    
    
    
    78,532Long-term debt
    
    
    99,000
    
    
    
    114,500Insurance and claim accruals
    
    
    6,621
    
    
    
    6,005Deferred compensation
    
    
    6,140
    
    
    
    5,844Deferred income taxes
    
    
    46,179
    
    
    
    48,170Other liabilities
    
    
    2,792
    
    
    
    2,859Commitments and contingenciesStockholders equity:Preferred stock, par value $0.001 per share; 100,000 authorized
shares; no shares issued and outstanding
    
    
    
    
    
    
    Common stock, par value $0.001 per share; 100,000 authorized
shares; 33,666 and 33,544 shares issued and outstanding at
June 30, 2011 and 2010, respectively
    
    
    6,427
    
    
    
    6,427Additional paid-in capital
    
    
    161,586
    
    
    
    158,030Accumulated other comprehensive loss, net of taxes
    
    
    (178
    )
    
    
    (142
    )Retained earnings
    
    
    86,554
    
    
    
    85,153Total stockholders equity
    
    
    254,389
    
    
    
    249,468Total liabilities and stockholders equity
    
    $
    493,609
    
    
    $
    505,378
   49




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PIKE ELECTRIC CORPORATION
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
 Years Ended June 30,2011
    
    
    2010
    
    
    2009Revenues
    
    $
    593,858
    
    
    $
    504,084
    
    
    $
    613,476Cost of operations
    
    
    525,915
    
    
    
    456,317
    
    
    
    503,203Gross profit
    
    
    67,943
    
    
    
    47,767
    
    
    
    110,273General and administrative expenses
    
    
    57,675
    
    
    
    51,994
    
    
    
    50,248Loss on sale and impairment of property and equipment
    
    
    751
    
    
    
    1,239
    
    
    
    2,116Restructuring expenses
    
    
    
    
    
    
    8,945
    
    
    
    Income (loss) from operations
    
    
    9,517
    
    
    
    (14,411
    )
    
    
    57,909Other expense (income):Interest expense
    
    
    6,608
    
    
    
    7,908
    
    
    
    9,258Other, net
    
    
    (55
    )
    
    
    (298
    )
    
    
    (1,552
    )Total other expense
    
    
    6,553
    
    
    
    7,610
    
    
    
    7,706Income (loss) before income taxes
    
    
    2,964
    
    
    
    (22,021
    )
    
    
    50,203Income tax expense (benefit)
    
    
    1,563
    
    
    
    (8,562
    )
    
    
    18,634Net income (loss)
    
    $
    1,401
    
    
    $
    (13,459
    )
    
    $
    31,569Earnings (loss) per share:Basic
    
    $
    0.04
    
    
    $
    (0.41
    )
    
    $
    0.96Diluted
    
    $
    0.04
    
    
    $
    (0.41
    )
    
    $
    0.94Shares used in computing earnings per share:Basic
    
    
    33,399
    
    
    
    33,132
    
    
    
    33,023Diluted
    
    
    33,996
    
    
    
    33,132
    
    
    
    33,741
   50




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PIKE ELECTRIC CORPORATION
 
 CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
(in thousands)
 Common
    
    
    
    
    
    
    Additional
    
    
    Other
    
    
    
    
    
    
    TotalStock
    
    
    Common
    
    
    Paid-In
    
    
    Comprehensive
    
    
    Retained
    
    
    StockholdersShares
    
    
    Stock
    
    
    Capital
    
    
    (Income) Loss
    
    
    Earnings
    
    
    EquityBalance June 30, 2008
    
    
    33,183
    
    
    $
    6,427
    
    
    $
    148,288
    
    
    $
    (806
    )
    
    $
    67,043
    
    
    $
    220,952Employee stock compensation plans, net
    
    
    279
    
    
    
    
    
    
    
    4,747
    
    
    
    
    
    
    
    
    
    
    
    4,747Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    31,569
    
    
    
    31,569Loss on derivative instruments, net of income
taxes of ($194)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (303
    )
    
    
    
    
    
    
    (303
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (303
    )
    
    
    31,569
    
    
    
    31,266Balance June 30, 2009
    
    
    33,462
    
    
    $
    6,427
    
    
    $
    153,035
    
    
    $
    (1,109
    )
    
    $
    98,612
    
    
    $
    256,965Employee stock compensation plans, net
    
    
    82
    
    
    
    
    
    
    
    4,995
    
    
    
    
    
    
    
    
    
    
    
    4,995Comprehensive income:Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (13,459
    )
    
    
    (13,459
    )Gain on derivative instruments, net of income
taxes of $615
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    967
    
    
    
    
    
    
    
    967Total comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    967
    
    
    
    (13,459
    )
    
    
    (12,492
    )Balance June 30, 2010
    
    
    33,544
    
    
    $
    6,427
    
    
    $
    158,030
    
    
    $
    (142
    )
    
    $
    85,153
    
    
    $
    249,468Employee stock compensation plans, net
    
    
    122
    
    
    
    
    
    
    
    3,556
    
    
    
    
    
    
    
    
    
    
    
    3,556Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,401
    
    
    
    1,401Loss on derivative instruments, net of income
taxes of ($23)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (36
    )
    
    
    
    
    
    
    (36
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (36
    )
    
    
    1,401
    
    
    
    1,365Balance June 30, 2011
    
    
    33,666
    
    
    $
    6,427
    
    
    $
    161,586
    
    
    $
    (178
    )
    
    $
    86,554
    
    
    $
    254,389
   51




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PIKE ELECTRIC CORPORATION
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
 Years ended June 30,2011
    
    
    2010
    
    
    2009Cash flows from operating activities:Net income (loss)
    
    $
    1,401
    
    
    $
    (13,459
    )
    
    $
    31,569Adjustments to reconcile net income (loss) to net cash
provided by operating activities:Depreciation and amortization
    
    
    38,033
    
    
    
    35,672
    
    
    
    36,564Non-cash interest expense
    
    
    2,303
    
    
    
    2,082
    
    
    
    1,534Deferred income taxes
    
    
    174
    
    
    
    (6,506
    )
    
    
    (389
    )Loss on sale and impairment of property and equipment
    
    
    751
    
    
    
    1,239
    
    
    
    2,116Restructuring charges, non-cash
    
    
    
    
    
    
    7,938
    
    
    
    Equity compensation expense
    
    
    4,102
    
    
    
    4,836
    
    
    
    3,437Excess tax benefit from stock-based compensation
    
    
    
    
    
    
    (18
    )
    
    
    (255
    )Changes in operating assets and liabilities:Accounts receivable and costs and estimated earnings in excess
of billings on uncompleted contracts
    
    
    (15,281
    )
    
    
    (7,501
    )
    
    
    16,631Inventories, prepaid expenses and other
    
    
    (9,603
    )
    
    
    440
    
    
    
    (1,357
    )Insurance and claim accruals
    
    
    (10,280
    )
    
    
    (4,350
    )
    
    
    (3,085
    )Accounts payable and other
    
    
    10,613
    
    
    
    1,996
    
    
    
    (5,713
    )Deferred compensation
    
    
    
    
    
    
    (1,402
    )
    
    
    (3,709
    )Net cash provided by operating activities
    
    
    22,213
    
    
    
    20,967
    
    
    
    77,343Cash flows from investing activities:Purchases of property and equipment
    
    
    (19,088
    )
    
    
    (17,663
    )
    
    
    (27,251
    )Business acquisitions, net
    
    
    (90
    )
    
    
    (15,157
    )
    
    
    (25,092
    )Net proceeds from sale of property and equipment
    
    
    2,676
    
    
    
    7,739
    
    
    
    6,462Net cash used in investing activities
    
    
    (16,502
    )
    
    
    (25,081
    )
    
    
    (45,881
    )Cash flows from financing activities:Principal payments on long-term debt
    
    
    (15,500
    )
    
    
    (26,000
    )
    
    
    Borrowings under revolving credit facility
    
    
    
    
    
    
    
    
    
    
    84,705Repayments under revolving credit facility
    
    
    
    
    
    
    
    
    
    
    (84,705
    )Stock option and employee stock purchase activity, net
    
    
    (42
    )
    
    
    201
    
    
    
    805Excess tax benefit from stock-based compensation
    
    
    
    
    
    
    18
    
    
    
    255Deferred loan costs
    
    
    (991
    )
    
    
    (2,792
    )
    
    
    (59
    )Net cash (used in) provided by financing activities
    
    
    (16,533
    )
    
    
    (28,573
    )
    
    
    1,001Net (decrease) increase in cash and cash equivalents
    
    
    (10,822
    )
    
    
    (32,687
    )
    
    
    32,463Cash and cash equivalents beginning of year
    
    
    11,133
    
    
    
    43,820
    
    
    
    11,357Cash and cash equivalents end of year
    
    $
    311
    
    
    $
    11,133
    
    
    $
    43,820
   52




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##### Table of Contents



PIKE ELECTRIC CORPORATION
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended June 30, 2011, 2010 and 2009
(in thousands, except per share amounts)
 1. Organization and Business
     For the Years Ended June 30,2011
    
    
    2010
    
    
    2009Core services
    
    $
    529,335
    
    
    
    89.1
    %
    
    $
    457,448
    
    
    
    90.7
    %
    
    $
    460,630
    
    
    
    75.1
    %Storm restoration services
    
    
    64,523
    
    
    
    10.9
    
    
    
    46,636
    
    
    
    9.3
    
    
    
    152,846
    
    
    
    24.9Total
    
    $
    593,858
    
    
    
    100.0
    %
    
    $
    504,084
    
    
    
    100.0
    %
    
    $
    613,476
    
    
    
    100.0
    %
 2. Summary of Significant Accounting Policies
 Principles of Consolidation
  Use of Estimates
  Reclassifications
   53




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##### Table of Contents



Cash and Cash Equivalents
  Revenue Recognition
    Allowance for Doubtful Accounts
   Inventories
   54




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##### Table of Contents



Property and Equipment
  .
 Goodwill and Other Intangible Assets
     55




---



##### Table of Contents



Insurance and Claim Accruals
   Collective Bargaining Agreements
  Stock-Based Compensation
   56




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##### Table of Contents



Advertising and Promotion Costs
  Earnings Per Share
  Deferred Loan Costs
  Derivative Instruments
   Income Taxes
 .
  57




---



##### Table of Contents



Recent Accounting Pronouncements
 Presentation of Comprehensive Income
  Accounting for Goodwill and Intangible Assets
  Accounting for Business Combinations
  Disclosures for Fair Value Measurements
 .
  58




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##### Table of Contents



3. Acquisitions
 Klondyke
    Year endedJune 30,2010Revenues
    
    $
    533,367Net loss
    
    $
    (13,593
    )Basic loss per common share
    
    $
    (0.41
    )Diluted loss per common share
    
    $
    (0.41
    )
  59




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##### Table of Contents



Facilities Planning & Siting
  Energy Delivery Services
   Current assets
    
    $
    18,629Property and equipment
    
    
    6,297Customer relationships
    
    
    2,800Non-compete agreements
    
    
    700Deferred tax asset
    
    
    2,855Goodwill
    
    
    10,321Total assets acquired
    
    
    41,602Current liabilities
    
    
    (16,103
    )Non-current liabilities
    
    
    (2,867
    )Total liabilities assumed
    
    
    (18,970
    )Net assets
    
    $
    22,632
   60




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##### Table of Contents



Year endedJune 30,2009Revenues
    
    $
    631,524Net income
    
    $
    31,124Basic earnings per common share
    
    $
    0.94Diluted earnings per common share
    
    $
    0.92
 4. Restructuring Expenses
   One-TimeEmployeeTermination
    
    
    Fixed AssetDescription
    
    Benefits
    
    
    Writedowns
    
    
    TotalAccrued restructuring balance as of
June 30, 2009
    
    $
    
    
    
    $
    
    
    
    $
    Costs incurred and charged
to expense
    
    
    1,007
    
    
    
    7,938
    
    
    
    8,945Cash payments
    
    
    (1,007
    )
    
    
    
    
    
    
    (1,007
    )Non-cash settlement
    
    
    
    
    
    
    (7,938
    )
    
    
    (7,938
    )Accrued restructuring balance as of
June 30, 2010
    
    $
    
    
    
    $
    
    
    
    $
    
    61




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##### Table of Contents



5. Property and Equipment
  Estimated Useful
    
    June 30,Lives in Years
    
    2011
    
    
    2010Land
    
    
    
    $
    2,971
    
    
    $
    2,971Buildings
    
    15-39
    
    
    26,783
    
    
    
    26,716Vehicles
    
    5-12
    
    
    229,208
    
    
    
    229,034Machinery and equipment
    
    3-19
    
    
    78,731
    
    
    
    77,219Office equipment, furniture
and software
    
    3-7
    
    
    27,862
    
    
    
    25,784Total
    
    
    
    
    365,555
    
    
    
    361,724Less: accumulated depreciation
    
    
    
    
    (187,873
    )
    
    
    (166,839
    )Property and equipment, net
    
    
    
    $
    177,682
    
    
    $
    194,885
    6. Goodwill and Other Intangible Assets
  AmountGoodwill at June 30, 2009
    
    $
    106,865Acquisition of Klondyke and acquisition
adjustments related to FPS
    
    
    7,913Goodwill at June 30, 2010
    
    $
    114,778Acquisition adjustments related to
Klondyke
    
    
    (3,885
    )Goodwill at June 30, 2011
    
    $
    110,893
   62




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##### Table of Contents



Customer
    
    
    Customer
    
    
    Non-CompeteRelationships
    
    
    Arrangements
    
    
    Agreements
    
    
    Trademarks
    
    
    TotalJune 30,
    
    
    June 30,
    
    
    June 30,
    
    
    June 30,
    
    
    June 30,2011
    
    
    2010
    
    
    2011
    
    
    2010
    
    
    2011
    
    
    2010
    
    
    2011
    
    
    2010
    
    
    2011
    
    
    2010Gross carrying value
    
    $
    50,706
    
    
    $
    48,106
    
    
    $
    6,990
    
    
    $
    6,990
    
    
    $
    8,090
    
    
    $
    6,990
    
    
    $
    600
    
    
    $
    
    
    
    $
    66,386
    
    
    $
    62,086Accumulated amortization
    
    
    (15,219
    )
    
    
    (12,160
    )
    
    
    (6,990
    )
    
    
    (6,990
    )
    
    
    (5,704
    )
    
    
    (4,409
    )
    
    
    (120
    )
    
    
    
    
    
    
    (28,033
    )
    
    
    (23,559
    )Net intangible assets
    
    $
    35,487
    
    
    $
    35,946
    
    
    $
    
    
    
    $
    
    
    
    $
    2,386
    
    
    $
    2,581
    
    
    $
    480
    
    
    $
    
    
    
    $
    38,353
    
    
    $
    38,527
   Years Ended June 30,
    
    Amount2012
    
    $
    3,9342013
    
    
    3,9952014
    
    
    2,7982015
    
    
    2,6882016
    
    
    2,447Thereafter
    
    
    22,491Total
    
    $
    38,353
 7. Debt
  June 30,2011
    
    
    2010Revolving credit facility
    
    $
    
    
    
    $
    Long-term debt:$300 million term loan
    
    $
    63,088
    
    
    $
    72,966$150 million term loan
    
    
    35,912
    
    
    
    41,53499,000
    
    
    
    114,500Less: current portion
    
    
    
    
    
    
    Long-term debt
    
    $
    99,000
    
    
    $
    114,500
   63




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64




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##### Table of Contents



8. Derivative Instruments and Hedging Activities
   Interest Rate Risk
     65




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##### Table of Contents



Diesel Fuel Risk
   Balance Sheet and Statement of Operations Information
  Asset Derivatives
    
    
    Liability DerivativesFair Value
    
    
    Fair Value
    
    
    Fair Value
    
    
    Fair Valueat June 30,
    
    
    at June 30,
    
    
    at June 30,
    
    
    at June 30,Balance Sheet Location
    
    2011
    
    
    2010
    
    
    2011
    
    
    2010Derivatives designated as hedging
instruments under U.S. GAAP:Interest rate swaps
    
    Accrued expenses and other
    
    $
    
    
    
    $
    
    
    
    $
    291
    
    
    $
    245Total derivatives designated as
hedging instruments under U.S. GAAP
    
    
    
    $
    
    
    
    $
    
    
    
    $
    291
    
    
    $
    245Derivatives not designated as hedging
instruments under U.S. GAAP:Diesel fuel swaps (gross) (1)
    
    Prepaid expenses and other
    
    $
    888
    
    
    $
    169
    
    
    $
    
    
    
    $
    Diesel fuel swaps (gross) (1)
    
    Accrued expenses and other
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    166Total derivatives not designated as
hedging instruments under U.S. GAAP
    
    
    
    $
    888
    
    
    $
    169
    
    
    $
    
    
    
    $
    166Total derivatives
    
    
    
    $
    888
    
    
    $
    169
    
    
    $
    291
    
    
    $
    411
 (1)
    
    The fair values of asset and liability derivatives with the same counterparty are netted
on the balance sheet.  66




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Derivatives designated as cash flow hedging instruments under U.S. GAAP:
 Location of Gain (Loss)
    
    Amount of Gain (Loss)Amount of Gain (Loss)
    
    
    Reclassified from
    
    Reclassified fromRecognized in OCI
    
    
    Accumulated OCI into
    
    Accumulated OCI intoFor the Year Ended June 30,
    
    (Effective Portion)
    
    
    Income (Loss)
    
    Income (Loss)2011
    
    
    2010
    
    
    
    
    2011
    
    
    2010Interest rate swaps
    
    $
    (36
    )
    
    $
    967
    
    
    Interest expense
    
    $
    (206
    )
    
    $
    (1,077
    )Totals
    
    $
    (36
    )
    
    $
    967
    
    
    
    
    $
    (206
    )
    
    $
    (1,077
    )
 Derivatives not designated as cash flow hedging instruments under U.S. GAAP:
 Location of Gain(Loss) Recognized
    
    Amount of Gain (Loss)For the Year Ended June 30,
    
    in Income (Loss)
    
    Recognized in Income (Loss)2011
    
    
    2010Diesel fuel swaps
    
    Cost of operations
    
    $
    884
    
    
    $
    317Total
    
    
    
    $
    884
    
    
    $
    317
   Accumulated OCI
  For the Year EndedJune 30,2011
    
    
    2010Net accumulated derivative loss deferred
at beginning of period
    
    $
    (142
    )
    
    $
    (1,109
    )Deferral of net derivative loss in accumulated
other
comprehensive loss
    
    
    (242
    )
    
    
    (110
    )Reclassification of net derivative loss against
income
    
    
    206
    
    
    
    1,077Net accumulated derivative loss deferred at
end of period
    
    $
    (178
    )
    
    $
    (142
    )
    67




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##### Table of Contents



9. Comprehensive Income (Loss)
  For the Year Ended June 30,2011
    
    
    2010Net income (loss)
    
    $
    1,401
    
    
    $
    (13,459
    )Change in fair value of interest rate cash
flow hedges,
net of income taxes of ($23) and $615,
respectively
    
    
    (36
    )
    
    
    967Comprehensive income (loss)
    
    $
    1,365
    
    
    $
    (12,492
    )
 10. Fair Value Measurements
   
    
    Level 1  Valuations based on quoted
prices in active markets for identical
instruments that we are able to access.
Since valuations are based on quoted prices
that are readily and regularly available in
an active market, valuation of these
products does not entail a significant
degree of judgment.
    
    Level 2  Valuations based on quoted
prices in active markets for instruments
that are similar, or quoted prices in
markets that are not active for identical
or similar instruments, and model-derived
valuations in which all significant inputs
and significant value drivers are
observable in active markets.
    
    Level 3  Valuations based on inputs
that are unobservable and significant to
the overall fair value measurement.
    68




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Description
    
    June 30, 2011
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3Asset:Diesel fuel swap agreements
    
    $
    888
    
    
    $
    
    
    
    $
    888
    
    
    $
    Liability:Interest rate swap
agreements
    
    
    (291
    )
    
    
    
    
    
    
    (291
    )
    
    
    Total
    
    $
    597
    
    
    $
    
    
    
    $
    597
    
    
    $
    
 Description
    
    June 30, 2010
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3Asset:Diesel fuel swap agreements
    
    $
    169
    
    
    $
    
    
    
    $
    169
    
    
    $
    Liability:Diesel fuel swap agreements
    
    
    (166
    )
    
    
    
    
    
    
    (166
    )
    
    
    Interest rate swap
agreements
    
    
    (245
    )
    
    
    
    
    
    
    (245
    )
    
    
    Total
    
    $
    (242
    )
    
    $
    
    
    
    $
    (242
    )
    
    $
    
   11. Income Taxes
  Years Ended June 30,2011
    
    
    2010
    
    
    2009Current
    
    $
    1,389
    
    
    $
    (2,056
    )
    
    $
    19,023Deferred
    
    
    174
    
    
    
    (6,506
    )
    
    
    (389
    )Total
    
    $
    1,563
    
    
    $
    (8,562
    )
    
    $
    18,634
  69




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June 30,2011
    
    
    2010Deferred tax liabilities:Tax over book depreciation
    
    $
    (49,547
    )
    
    $
    (51,260
    )Tax over book amortization
    
    
    (7,887
    )
    
    
    (8,858
    )Other
    
    
    (1,653
    )
    
    
    (942
    )Total deferred tax liabilities
    
    
    (59,087
    )
    
    
    (61,060
    )Deferred tax assets:Deferred compensation
    
    
    2,381
    
    
    
    2,283Self-insurance accruals
    
    
    7,887
    
    
    
    9,945Accrued vacation
    
    
    2,399
    
    
    
    2,109Other
    
    
    8,210
    
    
    
    9,079Total deferred tax assets
    
    
    20,877
    
    
    
    23,416Net deferred tax liabilities
    
    $
    (38,210
    )
    
    $
    (37,644
    )
  Years Ended June 30,2011
    
    
    2010
    
    
    2009Computed tax at federal statutory rate
    
    $
    1,037
    
    
    
    35.0
    %
    
    $
    (7,707
    )
    
    
    -35.0
    %
    
    $
    17,571
    
    
    
    35.0
    %State income taxes, net of federal expense
(benefit)
    
    
    308
    
    
    
    10.4
    %
    
    
    (1,028
    )
    
    
    -4.7
    %
    
    
    1,799
    
    
    
    3.6
    %Other
    
    
    218
    
    
    
    7.4
    %
    
    
    173
    
    
    
    0.8
    %
    
    
    (736
    )
    
    
    -1.5
    %Net income tax expense (benefit)
    
    $
    1,563
    
    
    
    52.8
    %
    
    $
    (8,562
    )
    
    
    -38.9
    %
    
    $
    18,634
    
    
    
    37.1
    %
    Years Ended June 30,2011
    
    
    2010
    
    
    2009Beginning of year
    
    $
    146
    
    
    $
    146
    
    
    $
    558Increases related to tax positions taken in a prior period
    
    
    
    
    
    
    
    
    
    
    75Decreases related to tax positions taken in a prior period
    
    
    
    
    
    
    
    
    
    
    (120
    )Decreases relating to settlements with taxing authorities
    
    
    
    
    
    
    
    
    
    
    (367
    )End of year
    
    $
    146
    
    
    $
    146
    
    
    $
    146
   70




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12. Employee Benefit Plans and Other Postretirement Benefits
   13. Stock-Based Compensation
 Overview
      71




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##### Table of Contents



Stock Options
  Years ended June 30,2011
    
    2010
    
    2009Dividend yield
    
    
    
    
    
    Risk-free interest rate
    
    1.26% - 2.54%
    
    2.65% - 2.74%
    
    1.87% - 3.00%Expected volatility
    
    0.41 - 0.44
    
    0.45
    
    0.38Expected life
    
    5.5 - 6.5 years
    
    6.0 - 6.5 years
    
    6.0 years
   Weighted
    
    
    WeightedAverage
    
    
    Average
    
    
    AggregateExercise
    
    
    Remaining
    
    
    IntrinsicOptions
    
    
    Price
    
    
    Life (years)
    
    
    ValueOptions outstanding, June 30, 2010
    
    
    3,349
    
    
    $
    10.33Exercised
    
    
    (41
    )
    
    $
    4.90Forfeited
    
    
    (122
    )
    
    $
    14.24Granted
    
    
    413
    
    
    $
    9.26Options outstanding, June 30, 2011
    
    
    3,599
    
    
    $
    10.14
    
    
    
    4.9
    
    
    $
    5,119Options vested and expected to vest,
June 30, 2011
    
    
    3,536
    
    
    $
    10.13
    
    
    
    4.8
    
    
    $
    5,113Options exercisable, June 30, 2011
    
    
    2,743
    
    
    $
    5.25
    
    
    
    2.3
    
    
    $
    5,037
     72




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Other Stock-Based Compensation
  WeightedAverage Grant-Shares
    
    
    Date Fair ValueNon-vested shares, June 30, 2010
    
    
    537
    
    
    $
    12.62Granted
    
    
    234
    
    
    $
    8.31Vested
    
    
    (306
    )
    
    $
    12.64Forfeited
    
    
    (11
    )
    
    $
    13.20Non-vested shares, June 30, 2011
    
    
    454
    
    
    $
    10.37
  Employee Stock Purchase Plan
  14. Earnings (Loss) Per Share
  Years Ended June 30,2011
    
    
    2010
    
    
    2009Basic:Net income (loss)
    
    $
    1,401
    
    
    $
    (13,459
    )
    
    $
    31,569Weighted average common shares
    
    
    33,399
    
    
    
    33,132
    
    
    
    33,023Basic earnings (loss) per share
    
    $
    0.04
    
    
    $
    (0.41
    )
    
    $
    0.96Diluted:Net income (loss)
    
    $
    1,401
    
    
    $
    (13,459
    )
    
    $
    31,569Weighted average common shares
    
    
    33,399
    
    
    
    33,132
    
    
    
    33,023Potential common stock arising from stock options and
restricted stock
    
    
    597
    
    
    
    
    
    
    
    718Weighted average common shares  diluted
    
    
    33,996
    
    
    
    33,132
    
    
    
    33,741Diluted earnings (loss) per share
    
    $
    0.04
    
    
    $
    (0.41
    )
    
    $
    0.94
  73




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15. Leases
  2012
    
    $
    8,3052013
    
    
    6,4512014
    
    
    5,8672015
    
    
    4,5852016
    
    
    3,762Thereafter
    
    
    4,578$
    33,548
  16. Deferred Compensation
      74




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##### Table of Contents



2012
    
    
    2013
    
    
    1,6592014
    
    
    2015
    
    
    2016
    
    
    Thereafter
    
    
    6,602Total
    
    
    8,261Less amount representing interest
    
    
    (2,121
    )Present value of expected payments
    
    
    6,140Less current portion
    
    
    Deferred compensation, net of current portion
    
    $
    6,140
 17. Financial Instruments
 Concentrations of Credit Risk
   Off-Balance Sheet Risk
  18. Related Party Transactions and Agreements
 Stockholders Agreement
   75




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19. Commitments and Contingencies
 Legal Proceedings
  Purchase Obligations
  Performance Bonds and Parent Guarantees
  Collective Bargaining Agreements
  Indemnities
   76




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##### Table of Contents



20. Quarterly Data

 Unaudited
  Quarter EndedSeptember 30,
    
    
    December 31,
    
    
    March 31,
    
    
    June 30,Fiscal 2011:Revenues
    
    $
    128,759
    
    
    $
    148,563
    
    
    $
    153,825
    
    
    $
    162,712Gross profit
    
    
    11,723
    
    
    
    16,638
    
    
    
    16,409
    
    
    
    23,174Net
(loss) income (1)
    
    
    (2,290
    )
    
    
    1,021
    
    
    
    620
    
    
    
    2,050Basic (loss) income per share
    
    $
    (0.07
    )
    
    $
    0.03
    
    
    $
    0.02
    
    
    $
    0.06Diluted (loss) income per share
    
    $
    (0.07
    )
    
    $
    0.03
    
    
    $
    0.02
    
    
    $
    0.06Fiscal 2010:Revenues
    
    $
    127,220
    
    
    $
    135,198
    
    
    $
    120,931
    
    
    $
    120,735Gross profit
    
    
    11,695
    
    
    
    16,936
    
    
    
    10,431
    
    
    
    8,705Net loss (2)
    
    
    (2,705
    )
    
    
    (4,703
    )
    
    
    (2,031
    )
    
    
    (4,020
    )Basic loss per share
    
    $
    (0.08
    )
    
    $
    (0.14
    )
    
    $
    (0.06
    )
    
    $
    (0.12
    )Diluted loss per share
    
    $
    (0.08
    )
    
    $
    (0.14
    )
    
    $
    (0.06
    )
    
    $
    (0.12
    )
 (1)
    
    In the first quarter of fiscal 2011, we recorded an
approximately $2,000 reduction of costs and estimated earnings in
excess of billings (Note 1). (2)
    
    In the second quarter of fiscal 2010, we recorded restructuring expenses of $8,924 (Note 4).  21. Subsequent Event
    77




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78




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##### Table of Contents



ITEM 9.
    
    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
  
 ITEM 9A.
    
    CONTROLS AND PROCEDURES
    
 ITEM 9B.
    
    OTHER INFORMATION
  
 Part III
 
 ITEM 10.
    
    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
     79




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ITEM 11.
    
    EXECUTIVE COMPENSATION
  
 ITEM 12.
    
    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
  
 ITEM 13.
    
    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
  
 ITEM 14.
    
    PRINCIPAL ACCOUNTANT FEES AND SERVICES
  
 Part IV
 
 ITEM 15.
    
    EXHIBITS, AND FINANCIAL STATEMENT SCHEDULES
 a)
    
    Financial Information
 (1)
    
    Financial Statements: See Index to Consolidated
Financial Statements in Part II, Item 8 of this
Form 10-K.(2)
    
    Financial Statement Schedule: See Schedule II 
Valuation and Qualifying Accounts of this Form
10-K.(3)
    
    ExhibitsSee (b) below.
 b)
    
    ExhibitsSee Exhibit Index on page 85.c)
    
    Financial Statement SchedulesSee a) (3) above.
  80




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SIGNATURES
  PIKE ELECTRIC CORPORATION
(Registrant)Date: September 6, 2011
    By:
    /s/ J. Eric PikeJ. Eric PikeChairman, Chief Executive Officer and President  Signature
    
    Title
    
    Date/s/ J. Eric Pike

J. Eric Pike
    
    Chairman, Chief Executive Officer and
President (Principal Executive Officer)
    
    September 6, 2011/s/ Anthony K. Slater

Anthony K. Slater
    
    Executive Vice President and Chief
Financial Officer (Principal Financial Officer)
    
    September 6, 2011/s/ Jeffrey S. Calhoun

Jeffrey S. Calhoun
    
    Chief Accounting Officer (Principal Accounting
Officer)
    
    September 6, 2011/s/ Charles E. Bayless

Charles E. Bayless
    
    Director
    
    September 6, 2011/s/ James R. Helvey III

James R. Helvey III
    
    Director
    
    September 6, 2011/s/ Peter Pace

Peter Pace
    
    Director
    
    September 6, 2011/s/ Robert D. Lindsay

Robert D. Lindsay
    
    Director
    
    September 6, 2011/s/ Daniel J. Sullivan

Daniel J. Sullivan
    
    Director
    
    September 6, 2011/s/ Louis F. Terhar

Louis F. Terhar
    
    Director
    
    September 6, 2011/s/ J. Russell Triedman

J. Russell Triedman
    
    Director
    
    September 6, 2011
  81




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SCHEDULE II
 PIKE ELECTRIC CORPORATION
VALUATION AND QUALIFYING ACCOUNTS
YEARS ENDED JUNE 30, 2011, 2010 AND 2009
 Balance at
    
    
    Charged to
    
    
    
    
    
    
    Balance atBeginning
    
    
    Revenue or
    
    
    
    
    
    
    End ofDescription
    
    of Period
    
    
    Expense
    
    
    Deductions
    
    
    Period(in thousands)Year ended June 30, 2011:Allowance for doubtful accounts (3)
    
    $
    813
    
    
    $
    110
    
    
    $
    (386
    )(1)
    
    $
    537Insurance claim reserve
    
    
    31,264
    
    
    
    30,521
    
    
    
    (41,075
    )(2)
    
    
    20,710Year ended June 30, 2010:Allowance for doubtful accounts (3)
    
    $
    896
    
    
    $
    819
    
    
    $
    (902
    )(1)
    
    $
    813Insurance claim reserve
    
    
    35,939
    
    
    
    38,096
    
    
    
    (42,771
    )(2)
    
    
    31,264Year ended June 30, 2009:Allowance for doubtful accounts (3)
    
    $
    699
    
    
    $
    1,058
    
    
    $
    (861
    )(1)
    
    $
    896Insurance claim reserve
    
    
    38,857
    
    
    
    41,621
    
    
    
    (44,539
    )(2)
    
    
    35,939
 (1)
    
    Represents uncollectible accounts written off, net of recoveries.(2)
    
    Represents claim payments for self-insured claims.(3)
    
    Allowance for doubtful accounts includes reserves for accounts receivable and costs and
estimated earnings in excess of billings on uncompleted contracts  82




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EXHIBIT INDEX
 EXHIBITNO.
    
    DESCRIPTION3.1
    
    
    Certificate of Incorporation of Pike Electric Corporation (Incorporated by reference to Exhibit
3.1 on our Registration Statement on Form S-1/A filed July 11, 2005)3.2
    
    
    Amended and Restated Bylaws of Pike Electric Corporation, as of September 1, 2011 (filed herewith)4.1
    
    
    Specimen Stock Certificate (Incorporated by reference to Exhibit 4.1 on our Registration
Statement on Form S-1/A filed July 22, 2005)4.2
    
    
    Senior Indenture (Incorporated by reference to Exhibit 4.1 on our Registration Statement on Form
S-3 filed July 16, 2009)4.3
    
    
    Subordinated Indenture (Incorporated by reference to Exhibit 4.2 on our Registration Statement on
Form S-3 filed July 16, 2009)10.1
    
    
    Credit Agreement, dated August 24, 2011, among Pike Electric Corporation, its subsidiaries party
thereto, Regions Bank, as administrative agent, and the lenders party thereto (Incorporated by
reference to Exhibit 10.1 on our Form 8-K filed August 30, 2011)10.2
    
    
    Security Agreement, dated August 24, 2011, among Pike Electric Corporation, the grantors party
thereto, and Regions Bank, as collateral agent (Incorporated by reference to Exhibit 10.2 on our
Form 8-K filed August 30, 2011)10.3
    
    
    Pledge Agreement, dated August 24, 2011, among Pike Electric Corporation, the pledgors party
thereto, and Regions Bank, as collateral agent (Incorporated by reference to Exhibit 10.3 on our
Form 8-K filed August 30, 2011)10.4
    
    
    Sixth Amendment and Restatement Agreement, dated as of July 29, 2009, to the Amended and Restated
Credit Agreement among Pike Electric Corporation, Pike Electric, Inc. and the lenders party
thereto (Incorporated by reference to Exhibit 10.1 on our Form 8-K filed August 3, 2009)10.5
    
    
    Second Amended and Restated Credit Agreement, dated as of July 29, 2009, among Pike Electric
Corporation, Pike Electric, Inc. and the lenders party thereto (Incorporated by reference to
Exhibit 10.2 on our Form 8-K filed August 3, 2009)10.6
    
    
    First Amendment to the Second Amended and Restated Credit Agreement, dated August 30, 2010, among
Pike Electric Corporation, Pike Electric, Inc. and the lenders party thereto (Incorporated by
reference to Exhibit 10.1 on our Form 8-K filed September 3, 2010)10.7
    
    
    Stockholders Agreement, dated April 18, 2002, among Pike Holdings, Inc., LGB Pike LLC, certain
rollover holders and certain management stockholders (Incorporated by reference to Exhibit 10.6
on our Registration Statement on Form S-1/A filed June 3, 2005)10.8
    
    
    Addendum, dated June 13, 2005, to the Stockholders Agreement dated April 18, 2002, among Pike
Holdings, Inc., LGB Pike LLC, certain rollover holders and certain management stockholders
(Incorporated by reference to Exhibit 10.13 on our Registration Statement on Form S-1/A filed
July 11, 2005)10.9
    
    
    Amendment, dated July 21, 2005, to the Stockholders Agreement dated April 18, 2002, among Pike
Electric Corporation as successor to Pike Holdings, Inc., LGB Pike II LLC as successor to LGB
Pike LLC, certain rollover holders and certain management stockholders (Incorporated by reference
to Exhibit 10.16 on our Registration Statement on Form S-1/A filed July 22, 2005)10.10
    *
    
    2006 Employee Stock Purchase Plan (Incorporated by reference to Appendix B of our Proxy Statement
on Schedule 14A filed October 28, 2005)10.11
    *
    
    2002 Stock Option Plan A (Incorporated by reference to Exhibit 10.2 on our Registration Statement
on Form S-1/A filed June 3, 2005)
  83




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##### Table of Contents



EXHIBITNO.
    
    DESCRIPTION10.12
    *
    
    2002 Stock Option Plan B (Incorporated by reference to Exhibit 10.3 on our Registration Statement
on Form S-1/A filed June 3, 2005)10.13
    *
    
    2005 Omnibus Incentive Compensation Plan (Incorporated by reference to Exhibit 10.15 on our
Registration Statement on Form S-1/A filed July 22, 2005)10.14
    *
    
    2008 Omnibus Incentive Compensation Plan (Incorporated by reference to Exhibit 10.1 on our Form
8-K filed December 11, 2007)10.15
    *
    
    Form of Stock Option Award Agreement (Incorporated by reference to Exhibit 10.11 on our Form 10-K
filed September 1, 200910.16
    *
    
    Form of Restricted Share Award Agreement (Incorporated by reference to Exhibit 10.12 on our Form
10-K filed September 1, 2009)10.17
    *
    
    Form of Restricted Stock Unit Award Agreement (Incorporated by reference to Exhibit 10.13 on our
Form 10-K filed September 1, 2009)10.18
    *
    
    Form of Director Restricted Stock Award Agreement (Incorporated by reference to Exhibit 10.14 on
our Form 10-K filed September 1, 2009)10.19
    *
    
    Management Incentive Plan (Incorporated by reference to Exhibit 10.15 on our Form 10-K filed
September 1, 2009)10.20
    *
    
    Deferred Compensation Plan (Incorporated by reference to Exhibit 10.1 on our Form S-8 filed
February 25, 2011)10.21
    *
    
    Director Compensation Summary (Incorporated by reference to Exhibit 10.1 on our Form 10-Q filed
November 9, 2009)10.22
    *
    
    Amended and Restated Employment Agreement between Pike Electric Corporation and J. Eric Pike,
dated as of September 24, 2008 (Incorporated by reference to Exhibit 10.1 on our Form 8-K filed
September 29, 2008)10.23
    *
    
    First Amendment to Amended and Restated Employment Agreement, dated May 1, 2009, by and between
Pike Electric Corporation and J. Eric Pike (Incorporated by reference to Exhibit 10.2 on our Form
8-K filed May 5, 2009)10.24
    *
    
    Form of Employment Agreement between Pike Electric Corporation and its executive officers
(Incorporated by reference to Exhibit 10.1 on our Form 8-K filed June 12, 2009)10.25
    *
    
    Form of Indemnification Agreement between Pike Electric Corporation and its Directors
(Incorporated by reference to Exhibit 10.1 on our Form 8-K filed May 5, 2009)21.1
    
    
    List of subsidiaries of Pike Electric Corporation (filed herewith)23.1
    
    
    Consent of Ernst & Young LLP (filed herewith)31.1
    
    
    Certification of Periodic Report by Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14a
and pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith)31.2
    
    
    Certification of Periodic Report by Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14a
and pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith)32.1
    
    
    Certification of Periodic Report by Chief Executive Officer and Chief Financial Officer pursuant
to U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(filed herewith)
 *
    
    Indicates a management contract or compensatory plan or arrangement.  84