Fluor Corp. (NYSE:FLR) Tuesday reported results for its fiscal 2000
first quarter ended January 31 that were consistent with the company's
outlook of modest earnings growth for the full year.
Net earnings for the quarter were $52.3 million, or 69 cents per share,
compared with $51.1 million, or 68 cents per share, for the same period
a year ago. Revenues were $3.0 billion, down 11 percent from $3.4
billion in the first quarter of 1999.
"First quarter results reinforce our confidence that the implementation
of our strategic initiatives is producing tangible benefits," said
Phillip J. Carroll, Jr., Fluor Corp.'s chairman and chief executive
officer. "In the near term, Fluor's business environment continues to
strengthen in several key markets and is contributing to a positive
outlook in the second half of the fiscal year.
"It must be emphasized that while we remain committed to achieving our
earnings targets over the near term, we also have made a commitment to
reinvest much of our earnings back into the company, through a host of
knowledge management and global sales development programs, to
strengthen our competitive position and ability to achieve our goals for
sustainable, long-term earnings growth. Our combined new awards of $2.4
billion, with a growth margin of 6.6 percent, represents a strong start
for fiscal 2000," Carroll added.
Fluor Daniel
Fluor Daniel, the company's engineering, procurement and construction
(EPC) business, reported operating profits of $41 million in the first
quarter, compared with $40 million in the same quarter last year.
Operating margin for the quarter improved to 2.1 percent from 1.6
percent a year ago, despite a substantial decline of 19 percent in
revenues to $2.0 billion.
New awards for Fluor Daniel were $1.4 billion in the quarter, compared
with $1.5 billion in 1999. Gross margins on first quarter new awards
were 5.8 percent, below the 8.4 percent a year ago, which included a
higher level of engineering-only work as well as a particularly strong
contribution from certain process-industry project awards. It is
expected that new awards margins will vary on a quarterly basis, but
margins continue to be an area of significant focus for improvement
through greater selectivity as market opportunities strengthen. Backlog
for Fluor Daniel at the end of the quarter was $6.5 billion, compared
with $9 billion a year ago. Backlog margin improved to 4.7 percent,
compared with 4.6 percent in the first quarter of 1999.
Fluor Global Services
Fluor Global Services reported a significant increase in quarterly
operating profit to $28 million, with operating margins improving to 3.7
percent from 2.6 percent a year ago. Revenues increased to $764 million
in the quarter from $664 million last year.
New awards for Fluor Global Services increased sharply to $1.0 billion
from $241 million in the first quarter last year. The inclusion of a
major award for the Telecommunications unit was a significant factor in
the quarterly improvement. New awards gross margin was 7.7 percent,
compared with 9.5 percent a year ago. Backlog increased 31 percent to
$2.7 billion, compared with $2.1 billion at the end of the first quarter
last year. Gross margin in backlog increased to 6.4 percent from 5.9
percent a year ago.
A.T. Massey
A.T. Massey, Fluor's low-sulfur coal business, posted operating profits
for the quarter of $32 million, down significantly from $39 million for
the same period a year ago. The decline was due to a number of operating
disruptions and continued difficult market conditions which have
resulted in lower realized prices and a less favorable sales mix.
Fluor Signature Services
Fluor Signature Services, Fluor's newest Strategic Business Enterprise,
officially began operations at the start of fiscal 2000. Created to
provide business and administrative support services to the operating
units with distinct profit-and-loss accountability generated on internal
charges to other units, the enterprise reported a slight operating loss
of $1 million in the first quarter. This enterprise's goal is to achieve
break-even performance in its first year of operation.
Other
Also contributing to first quarter results was the settlement of a
dispute with a major service provider that resulted in an after-tax gain
of $2.9 million, or 4 cents per share, which is included in cost of
revenues. Additionally, Fluor's effective tax rate for fiscal 2000 is
now projected to be in the range of 29-30 percent, down from 32.4
percent last year (excluding the impact of the special provision), due
to numerous initiatives to reduce effective tax rates.
Carroll continued, "We anticipate a slightly weaker second quarter
followed by a stronger second half, as our earnings improvement becomes
more broadly based across our business enterprises. The weighting toward
second half results is consistent with our historical quarterly earnings
pattern.
"Additionally, beginning in 2001, we will be changing our fiscal year to
a calendar year to be better aligned with our clients, suppliers and the
financial markets. Our business is becoming increasingly more services
based and the traditional EPC seasonality is less of a factor," Carroll
added.
Fluor Corp., with 1999 revenues of $12.4 billion, conducts business on a
global basis in the fields of engineering, procurement and construction,
global services, and coal production. *T
|
|
|
Fluor Corp.
|
|
ConsolidatedFinancial Results
|
|
(in millions, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter (Unaudited)
|
|
|
|
|
2000
|
|
|
1999
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
|
$
|
2,998.5
|
|
$
|
3,384.1
|
|
|
|
|
|
|
|
|
|
|
|
Costs and Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Revenues
|
|
|
|
|
2,897.8
|
|
|
3,291.2
|
|
|
|
|
|
|
|
|
|
|
|
Corporate G&A
|
|
|
|
|
16.8
|
|
|
9.6
|
|
|
|
|
|
|
|
|
|
|
|
Net Interest
|
|
|
|
|
9.8
|
|
|
8.4
|
|
|
|
|
|
|
|
|
|
|
|
Total Costs and Expenses
|
|
|
|
|
2,924.4
|
|
|
3,309.2
|
|
|
|
|
|
|
|
|
|
|
|
Earnings before Income Taxes
|
|
|
|
|
74.1
|
|
|
74.9
|
|
|
|
|
|
|
|
|
|
|
|
Income Tax Expense
|
|
|
|
|
21.8
|
|
|
23.8
|
|
|
|
|
|
|
|
|
|
|
|
Net Earnings
|
|
|
|
$
|
52.3
|
|
$
|
51.1
|
|
|
|
|
|
|
|
|
|
|
|
Net Earnings per Share (Basic)
|
|
|
|
$
|
.69
|
|
$
|
.68
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Shares (Basic)
|
|
|
|
|
75.6
|
|
|
75.1
|
|
|
|
|
|
|
|
|
|
|
|
Net Earnings per Share (Diluted)
|
|
|
|
$
|
.69
|
|
$
|
.68
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Shares (Diluted)
|
|
|
|
|
76.1
|
|
|
75.6
|
|
|
|
|
|
|
|
|
|
|
|
New Awards
|
|
|
|
$
|
2,363.9
|
|
$
|
1,700.9
|
|
|
|
|
|
|
|
|
|
|
|
New Awards Gross Margin (%)
|
|
|
|
|
6.6
|
|
|
8.5
|
|
|
|
|
|
|
|
|
|
|
|
Backlog -- January 31
|
|
|
|
|
9,238.7
|
|
|
11,064.5
|
|
|
|
|
|
|
|
|
|
|
|
Backlog Gross Margin (%)
|
|
|
|
|
5.2
|
|
|
4.9
|
|
|
|
|
|
|
|
|
|
|
|
Work Performed
|
|
|
|
$
|
2,549.0
|
|
$
|
2,890.2
|
|
|
|
|
|
|
|
|
|
|
|
Fluor Corp.
|
|
|
|
Selected Balance Sheet Items
|
|
($ in millions, except per share amounts) (Unaudited)
|
|
|
|
|
|
|
1/31/00
|
|
|
|
10/31/99
|
|
|
|
|
Cash and Securities
|
|
$
|
148.1
|
|
|
$
|
209.6
|
|
|
Total Current Assets
|
|
|
1,833.3
|
|
|
|
1,910.2
|
|
|
Total Assets
|
|
|
4,869.8
|
|
|
|
4,886.1
|
|
|
Total Short-term Debt
|
|
|
348.0
|
|
|
|
247.9
|
|
|
Total Current Liabilities
|
|
|
2,122.2
|
|
|
|
2,204.3
|
|
|
Long-term Debt
|
|
$
|
318.2
|
|
|
$
|
317.6
|
|
|
Total Debt to Capitalization (%)
|
|
|
29.0
|
%
|
|
|
26.3
|
%
|
|
Shareholders' Equity
|
|
$
|
1,627.2
|
|
|
$
|
1,581.4
|
|
|
Shareholders' Equity per Share
|
|
$
|
21.31
|
|
|
$
|
20.80
|
|
|
|
|
|
|
|
|
|
|
Strategic Business Enterprise Financial Review
|
|
($ in millions) (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1Q00
|
|
|
1Q99
|
|
|
|
|
|
|
|
|
|
|
|
Fluor Daniel
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
$
|
1,969.6
|
|
|
|
$
|
2,445.1
|
|
|
CFM Revenues
|
|
|
|
768.8
|
|
|
|
$
|
1,298.3
|
|
|
Gross Margin %
|
|
|
|
4.8
|
%
|
|
|
|
4.8
|
%
|
|
Operating Profit
|
|
|
$
|
40.9
|
|
|
|
$
|
39.8
|
|
|
Total Assets
|
|
|
$
|
971.5
|
|
|
|
|
N/A
|
|
|
|
|
|
|
|
|
|
|
|
|
Fluor Global Services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
$
|
764.1
|
|
|
|
$
|
664.3
|
|
|
Gross Margin %
|
|
|
|
9.5
|
%
|
|
|
|
9.7
|
%
|
|
Operating Profit
|
|
|
$
|
28.1
|
|
|
|
$
|
17.3
|
|
|
Total Assets
|
|
|
$
|
1,059.3
|
|
|
|
|
N/A
|
|
|
|
|
|
|
|
|
|
|
|
|
Fluor Signature Services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
$
|
4.7(a
|
)
|
|
|
|
--
|
|
|
Operating Profit (Loss)
|
|
|
|
(1.0
|
)
|
|
|
|
--
|
|
|
Total Assets
|
|
|
$
|
443.5
|
|
|
|
|
N/A
|
|
|
|
|
|
|
|
|
|
|
|
|
Massey Coal
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
$
|
260.1
|
|
|
|
$
|
274.6
|
|
|
Operating Profit
|
|
|
|
31.6
|
|
|
|
|
38.7
|
|
|
Total Assets
|
|
|
$
|
2,044.6
|
|
|
|
|
N/A
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)External revenues only.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fluor Corp.
|
|
SupplementalFact Sheet
|
|
|
|
|
|
|
|
|
|
|
|
|
BacklogTrends
|
|
(in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Fluor Daniel
|
Q100
|
|
Q199
|
|
% Chg
|
|
|
|
|
|
|
|
|
|
|
|
|
Chemicals & Life
|
|
|
|
|
|
|
|
|
|
|
Sciences
|
$
|
1,682
|
|
|
26
|
%
|
|
$
|
3,259
|
|
36
|
%
|
|
-48
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil, Gas & Power
|
|
3,053
|
|
|
47
|
%
|
|
|
2,497
|
|
28
|
%
|
|
22
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Mining
|
|
395
|
|
|
6
|
%
|
|
|
1,256
|
|
14
|
%
|
|
-69
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Manufacturing
|
|
1,028
|
|
|
16
|
%
|
|
|
1,503
|
|
17
|
%
|
|
-32
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Infrastructure
|
|
340
|
|
|
5
|
%
|
|
|
458
|
|
5
|
%
|
|
-26
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Fluor
|
|
|
|
|
|
|
|
|
|
|
Daniel
|
$
|
6,498
|
|
|
100
|
%
|
|
$
|
8,973
|
|
100
|
%
|
|
-28
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
United States
|
$
|
2,818
|
|
|
43
|
%
|
|
$
|
3,231
|
|
36
|
%
|
|
-13
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
The Americas
|
|
2,329
|
|
|
36
|
%
|
|
|
2,447
|
|
27
|
%
|
|
-5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe, Africa and the
|
|
|
|
|
|
|
|
|
|
|
Middle East (EAME)
|
|
892
|
|
|
14
|
%
|
|
|
1,850
|
|
21
|
%
|
|
-52
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Asia Pacific
|
|
459
|
|
|
7
|
%
|
|
|
1,445
|
|
16
|
%
|
|
-68
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Fluor
|
|
|
|
|
|
|
|
|
|
|
Daniel
|
$
|
6,498
|
|
|
100
|
%
|
|
$
|
8,973
|
|
100
|
%
|
|
-28
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Fluor Global Services
|
Q100
|
|
|
|
Q199
|
|
% Chg
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Government
|
$
|
518
|
|
|
19
|
%
|
|
$
|
647
|
|
31
|
%
|
|
-20
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Operations & Maintenance
|
|
1,355
|
|
|
49
|
%
|
|
|
1,265
|
|
61
|
%
|
|
7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Telecommunications
|
|
852
|
|
|
31
|
%
|
|
|
171
|
|
8
|
%
|
|
398
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Consulting Services &
|
|
|
|
|
|
|
|
|
|
|
Other
|
|
15
|
|
|
1
|
%
|
|
8
|
|
0
|
%
|
|
88
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Fluor Global
|
|
|
|
|
|
|
|
|
|
|
Services
|
$
|
2,740
|
|
|
100
|
%
|
|
$
|
2,091
|
|
100
|
%
|
|
31
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
United States
|
$
|
2,086
|
|
|
76
|
%
|
|
$
|
1,827
|
|
88
|
%
|
|
14
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
The Americas
|
|
--
|
|
|
0
|
%
|
|
8
|
|
0
|
%
|
|
-100
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe, Africa and the
|
|
|
|
|
|
|
|
|
|
|
Middle East (EAME)
|
|
489
|
|
|
18
|
%
|
|
6
|
|
0
|
%
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asia Pacific
|
|
165
|
|
|
6
|
%
|
|
|
250
|
|
12
|
%
|
|
-34
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Fluor Global
|
|
|
|
|
|
|
|
|
|
|
Services
|
$
|
2,740
|
|
|
100
|
%
|
|
$
|
2,091
|
|
100
|
%
|
|
31
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Backlog
|
$
|
9,238
|
|
|
|
$
|
11,064
|
|
|
|
-17
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New Awards
|
|
(inmillions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fluor Daniel
|
|
Q100
|
|
Q199
|
|
% Chg
|
|
YTD00 Y
|
|
TD99
|
|
% Chg
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chemicals & Life
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sciences
|
|
$
|
103
|
|
$
|
332
|
|
-69
|
%
|
|
$
|
103
|
|
$
|
332
|
|
-69
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil, Gas & Power
|
|
|
1,030
|
|
|
941
|
|
9
|
%
|
|
|
1,030
|
|
|
941
|
|
9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mining
|
|
|
--
|
|
2
|
|
-100
|
%
|
|
|
--
|
|
|
2 -
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Manufacturing
|
|
|
234
|
|
|
165
|
|
42
|
%
|
|
|
234
|
|
|
165
|
|
42
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Infrastructure
|
|
3
|
|
|
20
|
|
-85
|
%
|
|
3
|
|
|
20
|
|
-85
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Fluor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Daniel
|
|
$
|
1,370
|
|
$
|
1,460
|
|
-6
|
%
|
|
$
|
1,370
|
|
$
|
1,460
|
|
-6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fluor Global Services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Government
|
|
|
11
|
|
4
|
|
175
|
%
|
|
|
11
|
|
4
|
|
175
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operations & Maintenance
|
|
|
508
|
|
|
186
|
|
173
|
%
|
|
|
508
|
|
|
186
|
|
173
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Telecommunications
|
|
|
469
|
|
|
40
|
|
NM
|
|
|
|
469
|
|
|
40
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consulting Services &
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
|
|
6
|
|
|
11
|
|
-45
|
%
|
|
6
|
|
|
11
|
|
-45
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Fluor Global
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Services
|
|
|
994
|
|
|
241
|
|
312
|
%
|
|
|
994
|
|
|
241
|
|
312
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total New Awards
|
|
$
|
2,364
|
|
$
|
1,701
|
|
39
|
%
|
|
$
|
2,364
|
|
$
|
1,701
|
|
39
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Massey Coal
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tons Sold
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
in thousands
|
|
|
Q100
|
|
Q199
|
|
% Chg
|
|
YTD00
|
|
YTD99
|
|
% Chg
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Steam
|
|
|
6,118
|
|
5,368
|
|
14
|
%
|
|
6,118
|
|
5,368
|
|
14
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Metallurgical
|
|
|
3,235
|
|
3,995
|
|
-19
|
%
|
|
3,235
|
|
3,995
|
|
-19
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
9,353
|
|
9,363
|
|
0
|
%
|
|
9,353
|
|
9,363
|
|
0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Price ($/Ton)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
average realized prices
|
|
|
Q100
|
|
Q199
|
|
% Chg
|
|
YTD00
|
|
YTD99
|
|
% Chg
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Steam
|
|
|
25.42
|
|
26.33
|
|
-3
|
%
|
|
25.42
|
|
26.33
|
|
-3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Metallurgical
|
|
|
31.63
|
|
32.91
|
|
-4
|
%
|
|
31.63
|
|
32.91
|
|
-4
|
%
|
NM = Not Meaningful
NOTE:
The foregoing release contains forward-looking statements regarding
projected earnings levels, cost reductions, new awards and backlog
levels and the implementation of strategic initiatives. Such
forward-looking statements reflect current analysis of existing
information.
Caution must be exercised in relying on forward-looking statements. Due
to known and unknown risks, the company's actual results may differ
materially from its expectations or projections. Factors potentially
contributing to such differences include, among others:
-
Changes in global business, economic, political and social conditions;
-
The company's failure to receive anticipated new contract awards;
-
Customer cancellations of, or scope adjustments to, existing contracts;
-
Difficulties or delays incurred in the execution of construction
contracts resulting in cost overruns or liabilities;
-
Customer delays or defaults in making payments;
-
Fluctuations in the demand for, and price of, coal and other natural
resource commodities;
-
Difficulties and delays incurred in the implementation of strategic
initiatives; and
-
Competition in the global engineering and construction industry.
The forward-looking statements are also based on various
operating assumptions regarding, among other things, overhead costs and
employment levels that may not be realized.
While most risks affect only future costs or revenues anticipated by the
company, some risks may relate to accruals that have already been
reflected in earnings. The company's failure to receive payments of
accrued amounts could result in a charge against future earnings.
Additional information concerning factors that may influence the
company's results can be found in its news releases as well as its
periodic filings with the Securities and Exchange Commission. In this
regard, risk factors are specifically discussed under the heading "Item
I. Business -- Other Matters -- Company Business Risks" in the Company's
Form 10-K for its fiscal year ended Oct. 31, 1999. Such filings are
available publicly and upon request from Fluor's Investor Relations
Department: 949/349-3909. The company disclaims any intent or obligation
to update its forward-looking statements.
Fluor Corp. releases are available on Fluor's Corporate News on the Net
site at http://www.businesswire.com/cnn/flr.htm.
Fluor Corp., Aliso ViejoLila Churney (investor relations), 949/349-3909orKeith Karpe (media relations), 949/349-7661