Fluor Corporation (NYSE: FLR) today announced financial results for its
first quarter ended March 31, 2006. Revenues for the first quarter
increased 27 percent to $3.6 billion, up from $2.9 billion in the first
quarter of 2005. Net earnings increased to $88.9 million, or $1.00 per
share, compared with $47.4 million, or $0.56 per share for the same
period last year. Operating profits rose 56 percent to $184.4 million,
with the majority of the increase coming from the Government and Global
Services segments, along with continued strong contributions from Oil &
Gas. Operating margins rose to 5.1 percent, up from 4.1 percent a year
ago.
New awards for the first quarter were $3.8 billion, with substantial new
bookings in all segments except Power. Consolidated backlog rose to
$15.4 billion, compared with $14.9 billion at December 31, 2005.
"Fluor is off to a great start in 2006," said Chairman and Chief
Executive Officer Alan Boeckmann. "Earnings per share exceeded
expectations and we continue to see substantial new project
opportunities in all business groups. The outlook for Fluor is very
positive, with many of our markets in strong upturns driving continued
growth in demand for engineering, procurement, construction and
maintenance services globally. Clients continue to announce significant
capital spending plans, and the company is particularly well- positioned
to capitalize on these trends in oil & gas, petrochemicals,
infrastructure, mining and power."
Corporate G&A expense for the quarter was $41.8 million compared with
$38.1 million a year ago. Fluor's cash and securities declined to $654
million from $789 million last quarter, primarily due to working capital
balances associated with work for the Federal Emergency Management
Agency (FEMA).
Outlook
The first quarter was very strong, but contributions from the Government
group's contingency response work for FEMA, reconstruction work in Iraq,
and the nearly-complete Fernald project are likely to be materially
lower in the second half of 2006. Considering the strong first quarter
performance and the favorable outlook for Fluor's other markets in 2006,
we are raising our guidance for the year to a range of $2.90 to $3.20
per share, up from previous guidance of $2.80 to $3.10 per share.
Business Segments
Fluor's Oil & Gas segment reported revenues of $1.2 billion, level with
the first quarter of last year. Operating profit was a strong $56.7
million, compared to $54.3 million a year ago, with operating margins
improving to 4.8 percent, from 4.6 percent last year. New awards were
very strong across upstream, downstream and petrochemical markets and
backlog rose 12 percent over last quarter.
Fluor's Industrial & Infrastructure segment reported revenue of $763
million, up 14 percent from $670 million a year ago. Operating profit
declined from $20.8 million a year ago to $13.6 million this quarter.
Operating margins were 1.8 percent, compared with 3.1 percent a year ago
which benefited from substantial progress on a European infrastructure
project. The infrastructure unit recently announced two major new
awards, the first of which was the construction management of the World
Trade Center transportation hub, with Fluor's 32.5 percent share of the
$1 billion project included in the first quarter. The second
announcement occurred in April, when the unit received official
confirmation of the award of the San Francisco-Oakland Bay Bridge
project. Fluor's portion of this award is approximately $700 million,
and will be booked into backlog in the second quarter.
The Government segment reported first quarter revenues of $1.1 billion,
up from $561 million a year ago. Operating profit increased to $78.5
million, up from $9.1 million in the first quarter of 2005 which
included $31 million in loss provisions on fixed price embassy
contracts. Operating margins rose to 6.9 percent, from 1.6 percent a
year ago. Increased profits and margins were attributable to the absence
of charges on embassy projects, to disaster relief work for FEMA, as
well as solid contributions from the Fernald project and reconstruction
work in Iraq.
Revenue for the Global Services segment grew 26 percent during the
quarter to $459.3 million, from $365.4 million a year ago. Operating
profit increased 14 percent to $35.6 million, up from $31.3 million a
year ago. Growth in revenues was broad-based, while increases in profits
were mainly due to strength in the construction equipment services and
temporary staffing units. Operating margins decreased modestly, from 8.6
percent a year ago to 7.8 percent this quarter.
Fluor's Power segment reported $77.8 million in revenue, level with
revenue of $79.1 million in the first quarter of 2005. For the quarter,
the Power segment reported break-even results, compared with profits of
$3.1 million in the first quarter of 2005. A key Power client recently
named Fluor as one of two exclusive partners for the engineering,
procurement and construction of a major program for new coal-fired power
generation facilities.
First Quarter Conference Call
Fluor will host a conference call at 10:00 a.m. Eastern Daylight Time on
Tuesday, May 9, 2006 which will be webcast live on the internet and can
be accessed by logging onto http://investor.fluor.com.
The webcast will be archived for 30 days following the call.
About Fluor Corporation
Fluor Corporation provides services on a global basis in the fields of
engineering, procurement, construction, operations, maintenance and
project management. Headquartered in Irving, Texas, Fluor is a FORTUNE
500 company with revenues of $13.2 billion in 2005. For more
information, visit http://www.fluor.com.
Forward-Looking Statements: This release contains forward-looking
statements, including, without limitation, statements relating to the
preliminary financial results of the Company pending completion of the
Company's audit, future backlog, revenue and earnings growth
opportunities, expected performance of the Company's business and the
expansion of the markets which the Company serves. The forward-looking
statements are based on current management expectations and involve
risks and uncertainties. Actual results may differ materially as a
result of a number of factors, including, among other things: differing
financial results upon completion of the Company's audit; failure to
achieve projected backlog, revenue and/or earnings levels; the timely
and successful implementation of strategic initiatives; customer
cancellations of, or scope adjustments to, existing contracts;
difficulties or delays incurred in the execution of contracts; decreased
capital investment or expenditures, failure to make anticipated
increased capital investment or expenditures, by the Company's clients
including our oil, gas, petrochemicals, infrastructure, mining, power
and government clients; the Company's failure to receive anticipated new
contract awards; increased liability risks in any of the markets the
Company serves; the Company's inability to successfully convert
front-end engineering services into future project awards; the cyclical
nature of many of the markets the Company serves; our ability to hire
and retain qualified personnel; and changes in global business,
economic, political and social conditions. Caution must be exercised in
relying on these and other forward-looking statements. Due to known and
unknown risks, the Company's results may differ materially from its
expectations and projections.
Additional information concerning these and other factors can be found
in press releases as well as the Company's public periodic filings with
the Securities and Exchange Commission, including the discussion under
the heading "Item 1A. Business -- Company Risk Factors" in the Company's
Form 10-K filed on March 1, 2006, and Form 10-Q for the quarter ended
March 31, 2006 filed on May 8, 2006. Such filings are available either
publicly or upon request from Fluor's Investor Relations Department:
(949) 349-3815. The Company disclaims any intent or obligation to update
its forward-looking statements in light of new information or future
events.
|
|
|
FLUOR CORPORATION
|
|
(in millions, except per share amounts)
|
|
Unaudited
|
|
CONSOLIDATED OPERATING RESULTS
|
|
|
|
|
|
|
|
THREE MONTHS ENDED MARCH 31
|
|
|
2006
|
|
|
|
2005
|
|
|
Revenues
|
|
$
|
3,624.9
|
|
|
$
|
2,859.8
|
|
|
Costs and Expenses:
|
|
|
|
|
|
Cost of Revenues
|
|
|
3,440.5
|
|
|
|
2,741.2
|
|
|
Corporate G&A
|
|
|
41.8
|
|
|
|
38.1
|
|
|
Net Interest Income
|
|
|
(0.2
|
)
|
|
|
(0.1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Total Costs and Expenses
|
|
|
3,482.1
|
|
|
|
2,779.2
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings before Income Taxes
|
|
|
142.8
|
|
|
|
80.6
|
|
|
Income Tax Expense
|
|
|
53.9
|
|
|
|
33.2
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Earnings
|
|
$
|
88.9
|
|
|
$
|
47.4
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic Earnings per Share
|
|
|
|
|
|
Net Earnings
|
|
$
|
1.03
|
|
|
$
|
0.57
|
|
|
Weighted Average Shares
|
|
|
85.9
|
|
|
|
83.7
|
|
|
Diluted Earnings per Share
|
|
|
|
|
|
Net Earnings
|
|
$
|
1.00
|
|
|
$
|
0.56
|
|
|
Weighted Average Shares
|
|
|
88.9
|
|
|
|
84.9
|
|
|
New Awards
|
|
$
|
3,825.8
|
|
|
$
|
3,350.7
|
|
|
Backlog
|
|
$
|
15,377.3
|
|
|
$
|
15,416.0
|
|
|
Work Performed
|
|
$
|
3,540.9
|
|
|
$
|
2,806.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BUSINESS SEGMENT FINANCIAL REVIEW
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS ENDED MARCH 31
|
|
|
2006
|
|
|
|
|
2005
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
Oil & Gas
|
|
$
|
1,191.2
|
|
|
|
$
|
1,183.9
|
|
|
|
Industrial & Infrastructure
|
|
|
762.9
|
|
|
|
|
670.3
|
|
|
|
Government
|
|
|
1,133.7
|
|
|
|
|
561.1
|
|
|
|
Global Services
|
|
|
459.3
|
|
|
|
|
365.4
|
|
|
|
Power
|
|
|
77.8
|
|
|
|
|
79.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
$
|
3,624.9
|
|
|
|
$
|
2,859.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Profit
|
|
|
|
|
|
|
|
|
|
Margin $ and %
|
|
$
|
|
%
|
|
$
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Oil & Gas
|
|
$
|
56.7
|
|
4.8
|
|
$
|
54.3
|
|
4.6
|
|
Industrial & Infrastructure
|
|
|
13.6
|
|
1.8
|
|
|
20.8
|
|
3.1
|
|
Government
|
|
|
78.5
|
|
6.9
|
|
|
9.1
|
|
1.6
|
|
Global Services
|
|
|
35.6
|
|
7.8
|
|
|
31.3
|
|
8.6
|
|
Power
|
|
|
---
|
|
---
|
|
|
3.1
|
|
4.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Operating Profit
|
|
|
|
|
|
|
|
|
|
Margin $ and %
|
|
$
|
184.4
|
|
5.1
|
|
$
|
118.6
|
|
4.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FLUOR CORPORATION
|
|
Unaudited
|
|
SELECTED BALANCE SHEET ITEMS
|
|
|
|
|
|
($ in millions, except per share amounts)
|
|
|
|
|
|
|
|
MARCH 31, 2006
|
|
DEC. 31, 2005
|
|
Cash and Cash Equivalents
|
|
$
|
654.0
|
|
|
$
|
789.0
|
|
|
Total Current Assets
|
|
|
3,383.5
|
|
|
|
3,108.2
|
|
|
Total Assets
|
|
|
4,854.6
|
|
|
|
4,574.4
|
|
|
Total Short-Term Debt
|
|
|
375.1
|
|
|
|
330.0
|
|
|
Total Current Liabilities
|
|
|
2,515.5
|
|
|
|
2,339.3
|
|
|
Long-term Debt
|
|
|
106.3
|
|
|
|
92.0
|
|
|
Shareholders' Equity
|
|
|
1,715.1
|
|
|
|
1,630.6
|
|
|
|
|
Total Debt to Capitalization %
|
|
|
21.9
|
%
|
|
|
20.6
|
%
|
|
Shareholders' Equity Per Share
|
|
$
|
19.60
|
|
|
$
|
18.72
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELECTED CASH FLOW ITEMS
|
|
|
|
|
|
($ in millions)
|
|
|
|
|
|
|
|
THREE MONTHS ENDED MARCH 31
|
|
|
|
|
2006
|
|
|
|
2005
|
|
|
|
|
|
|
|
|
|
|
Cash Provided (Utilized) by Operating
|
|
|
|
|
|
Activities
|
|
$
|
(158.3
|
)
|
|
$
|
36.9
|
|
|
|
|
|
|
|
|
|
|
Investing Activities
|
|
|
|
|
|
Capital Expenditures
|
|
|
(56.1
|
)
|
|
|
(33.2
|
)
|
|
Other, Net
|
|
|
5.0
|
|
|
|
1.7
|
|
|
|
|
|
|
|
|
|
|
Cash Utilized by Investing Activities
|
|
|
(51.1
|
)
|
|
|
(31.5
|
)
|
|
|
|
|
|
|
|
|
|
Financing Activities
|
|
|
|
|
|
Increase (decrease) in short-term borrowings
|
|
|
45.1
|
|
|
|
(10.0
|
)
|
|
Non-recourse Project Financing
|
|
|
14.3
|
|
|
|
---
|
|
|
Issuance of Common Stock
|
|
|
---
|
|
|
|
41.8
|
|
|
Cash Dividends
|
|
|
---
|
|
|
|
(13.7
|
)
|
|
Other, Net
|
|
|
19.7
|
|
|
|
30.8
|
|
|
|
|
|
|
|
|
|
|
Cash Provided by Financing Activities
|
|
|
79.1
|
|
|
|
48.9
|
|
|
|
|
|
|
|
|
|
|
Effect of Exchange Rate Changes on Cash
|
|
|
(4.7
|
)
|
|
|
(15.8
|
)
|
|
|
|
|
|
|
|
|
|
Increase (Decrease) in Cash and
|
|
|
|
|
|
Cash Equivalents
|
|
$
|
(135.0
|
)
|
|
$
|
38.5
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
$
|
27.8
|
|
|
$
|
23.2
|
|
|
|
|
|
|
|
|
|
|
|
|
FLUOR CORPORATION
|
|
Supplemental Fact Sheet
|
|
NEW AWARDS
|
|
|
|
|
|
|
|
|
|
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS ENDED MARCH 31
|
|
|
2006
|
|
|
|
2005
|
|
|
% Chg
|
|
Oil & Gas
|
|
$
|
1,804
|
|
47
|
%
|
|
$
|
1,480
|
|
44
|
%
|
|
22
|
%
|
|
Industrial & Infrastructure
|
|
|
672
|
|
18
|
%
|
|
|
592
|
|
18
|
%
|
|
14
|
%
|
|
Government
|
|
|
766
|
|
20
|
%
|
|
|
443
|
|
13
|
%
|
|
73
|
%
|
|
Global Services
|
|
|
578
|
|
15
|
%
|
|
|
754
|
|
23
|
%
|
|
(23
|
)%
|
|
Power
|
|
6
|
|
0
|
%
|
|
|
82
|
|
2
|
%
|
|
(93
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL NEW AWARDS
|
|
$
|
3,826
|
|
100
|
%
|
|
$
|
3,351
|
|
100
|
%
|
|
14
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BACKLOG TRENDS
|
|
|
|
|
|
|
|
|
|
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AS OF MARCH 31
|
|
|
2006
|
|
|
|
2005
|
|
|
% Chg
|
|
Oil & Gas
|
|
$
|
6,777
|
|
44
|
%
|
|
$
|
5,905
|
|
38
|
%
|
|
15
|
%
|
|
Industrial & Infrastructure
|
|
|
3,773
|
|
25
|
%
|
|
|
4,868
|
|
32
|
%
|
|
(22
|
)%
|
|
Government
|
|
|
1,061
|
|
7
|
%
|
|
|
1,469
|
|
10
|
%
|
|
(28
|
)%
|
|
Global Services
|
|
|
2,663
|
|
17
|
%
|
|
|
2,691
|
|
17
|
%
|
|
(1
|
)%
|
|
Power
|
|
|
1,103
|
|
7
|
%
|
|
|
483
|
|
3
|
%
|
|
128
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL BACKLOG
|
|
$
|
15,377
|
|
100
|
%
|
|
$
|
15,416
|
|
100
|
%
|
|
(0
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United States
|
|
$
|
6,114
|
|
40
|
%
|
|
$
|
5,075
|
|
33
|
%
|
|
20
|
%
|
|
The Americas
|
|
|
2,114
|
|
14
|
%
|
|
|
4,028
|
|
26
|
%
|
|
(48
|
)%
|
|
Europe, Africa and the
|
|
|
|
|
|
|
|
|
|
|
|
Middle East
|
|
|
6,119
|
|
39
|
%
|
|
|
5,369
|
|
35
|
%
|
|
14
|
%
|
|
Asia Pacific
|
|
|
1,030
|
|
7
|
%
|
|
|
944
|
|
6
|
%
|
|
9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL BACKLOG
|
|
$
|
15,377
|
|
100
|
%
|
|
$
|
15,416
|
|
100
|
%
|
|
(0
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lisa Boyette/Keith Stephens
Media Relations
469.398.7622
/469.398.7624 tel
Ken Lockwood
Investor Relations
949.349.3815 tel
949.349.5375
fax
media relations, Lisa Boyette, +1-469-398-7622, or KeithStephens, +1-469-398-7624, or investor relations, Ken Lockwood,+1-949-349-3815, or fax, +1-949-349-5375, all of Fluor Corporation//Web site: http://www.fluor.comhttp://investor.fluor.com /