The data for Project Timer is stored in a file called ProjectTimer.xml. The default location of this file is in the My Documents folder but you can change that on Settings > General > Data file.
To backup your data, open the appropriate folder listed above or the folder you chose on the Preferences screen. Copy your ProjectTimer.xml data somewhere safe to back up. In the event of a problem, just copy that file back and start Project Timer and you will get your data back. (Project Timer also creates copies of your data and saves them daily as .bak files on the same location for even more safety)