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Fluor Corp – ‘10-QT’ for 12/31/00

On: Wednesday, 2/14/01, at 5:14pm ET · For: 12/31/00 · Accession #: 1017062-1-335 · File #: 1-16129

  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 2/14/01  Fluor Corp                        10-QT      12/31/00    1:35K                                    Donnelley R R & S… 11/FA

Quarterly-Transition Report — Form 10-Q
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-QT       For Transition Period 11/01/2000 to 12/31/2000        19     72K

Document Table of Contents

Page	(sequential)	\|	(alphabetic)	Top
			Alternative Formats (Word, et al.) Exhibits and Reports on Form 8-K Part II: Other Information Signatures
1	1st Page - Filing Submission
18	Part II: Other Information
"	Item 6. Exhibits and Reports on Form 8-K
19	Signatures

10-QT 1st Page of 19 TOC ↑Top Previous Next ↓Bottom Just 1st
 
UNITED STATES 
SECURITIES AND EXCHANGE COMMISSION  
Washington, D.C. 20549  

FORM 10-Q 

(Mark One)  

[_]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES         
EXCHANGE ACT OF 1934                                                  

For the quarterly period ended ________________                                 

OR

[X]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES        
EXCHANGE ACT OF 1934                                                  

For the transition period from November 1, 2000 to December 31, 2000            
                   ----------------    -----------------

Commission File Number:  1-16129                                                

FLUOR CORPORATION 
--------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)

Delaware                                33-0927079
--------------------------------------------------------------------------------
(State or other jurisdiction of             (I.R.S. Employer I.D. No.)    
incorporation or organization)                                            

One Enterprise Drive, Aliso Viejo, CA  92656
--------------------------------------------------------------------------------
(Address of principal executive offices)

(949) 349-2000
--------------------------------------------------------------------------------
(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was     
required to file such reports), and (2) has been subject to such filing         
requirements for the past 90 days.  Yes [X]  No [_]                             

As of January 31, 2001 there were 76,134,673 shares of common stock outstanding.

10-QT 2nd Page of 19 TOC 1st Previous Next ↓Bottom Just 2nd
FLUOR CORPORATION 

FORM 10-Q 

December 31, 2000 

                                                        [Enlarge/Download Table]

TABLE OF CONTENTS                                                                   PAGE
----------------------------------------------------------------------------------------

Part I:  Financial Information                                                          
                                                                                        
         Condensed Consolidated Statement of Operations for the Two Months Ended        
         December 31, 2000 and 1999 ...............................................   2 

         Condensed Consolidated Balance Sheet at December 31, 2000 and October 31,      
          2000 ....................................................................   3 

         Condensed Consolidated Statement of Cash Flows for the Two Months Ended        
          December 31, 2000 and 1999 ..............................................   5 

         Notes to Condensed Consolidated Financial Statements .....................   6 

         Management's Discussion and Analysis of Financial Condition and Results        
          of Operations ...........................................................  10 

         Changes in Consolidated Backlog ..........................................  16 

Part II: Other Information.........................................................  17 

Signatures ........................................................................  18 

1 

10-QT 3rd Page of 19 TOC 1st Previous Next ↓Bottom Just 3rd
Part I: Financial Information 

FLUOR CORPORATION 
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS  
Two Months Ended December 31, 2000 and 1999 

UNAUDITED 

                                                                [Download Table]

$ in thousands, except per share amounts              2000             1999    
------------------------------------------------------------------------------ 
                                                                               
REVENUES                                          $1,866,519        $1,722,729 
                                                  ---------------------------- 
COSTS AND EXPENSES                                                             
   Cost of revenues                                1,826,668         1,679,193 
   Corporate administrative                                                    
    and general expense                               41,991            15,259 
   Interest expense                                    6,808             2,853 
   Interest income                                    (1,846)           (1,790)
                                                  ---------------------------- 
Total Costs and Expenses                           1,873,621         1,695,515 
                                                  ---------------------------- 
EARNINGS (LOSS) FROM CONTINUING                                                
   OPERATIONS BEFORE TAXES                            (7,102)           27,214 
INCOME TAX EXPENSE (BENEFIT)                          (3,079)            8,577 
                                                  ---------------------------- 
NET EARNINGS (LOSS) FROM CONTINUING                                            
   OPERATIONS                                         (4,023)           18,637 
EARNINGS FROM DISCONTINUED                                                     
   OPERATIONS, NET OF TAXES                               --             9,191 
                                                  ---------------------------- 
NET EARNINGS (LOSS)                               $   (4,023)       $   27,828 
                                                  ============================ 
BASIC EARNINGS (LOSS) PER SHARE                                                
   CONTINUING OPERATIONS                          $    (0.05)       $     0.25 
   DISCONTINUED OPERATIONS                                --              0.12 
                                                  ---------------------------- 
   NET EARNINGS (LOSS)                            $    (0.05)       $     0.37 
                                                  ============================ 
DILUTED EARNINGS (LOSS) PER SHARE                                              
   CONTINUING OPERATIONS                          $    (0.05)       $     0.24 
   DISCONTINUED OPERATIONS                                --              0.12 
                                                  ---------------------------- 
   NET EARNINGS (LOSS)                            $    (0.05)       $     0.36 
                                                  ============================ 
SHARES USED TO CALCULATE                                                       
   BASIC EARNINGS PER SHARE                           74,098            75,565 
                                                  ============================ 
   DILUTED EARNINGS PER SHARE                         74,098            76,163 
                                                  ============================ 

See Accompanying Notes.                                                         

2 

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FLUOR CORPORATION 
CONDENSED CONSOLIDATED BALANCE SHEET  
December 31, 2000 and October 31, 2000  

UNAUDITED 

                                                        [Enlarge/Download Table]

                                                          December 31,     October 31,
$ in thousands                                               2000             2000*   
--------------------------------------------------------------------------------------
                                                                                      
ASSETS                                                                                
Current assets                                                                        
   Cash and cash equivalents                             $   21,850       $   69,426  
   Accounts and notes receivable                            680,836          665,117  
   Contract work in progress                                366,223          439,208  
   Deferred taxes                                           116,753          112,156  
   Inventory and other current assets                       196,596          161,886  
                                                         ---------------------------  
      Total current assets                                1,382,258        1,447,793  

Net assets of discontinued operations                            --          866,199  

Property, plant and equipment (net of accumulated                                     
 depreciation and amortization of $450,709 and $441,418,                              
 respectively)                                              760,876          756,765  

Investments and goodwill, net                               192,795          190,403  
Deferred taxes                                               82,452           86,056  
Other                                                       282,180          305,518  
                                                         ---------------------------  
                                                         $2,700,561       $3,652,734  
                                                         ===========================  

(Continued On Next Page)

* Amounts at October 31, 2000 have been derived from audited financial          
statements.                                                                 

3 

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FLUOR CORPORATION 
CONDENSED CONSOLIDATED BALANCE SHEET  
December 31, 2000 and October 31, 2000  

UNAUDITED 

                                                        [Enlarge/Download Table]
                                                                 December 31,              October 31,
$ in thousands                                                          2000                     2000*
----------------------------------------------------------------------------------------------------- 
                                                                                                      
LIABILITIES AND SHAREHOLDERS' EQUITY                                                                  
Current liabilities                                                                                   
    Trade accounts payable                                        $  482,930               $  530,332 
    Short-term debt                                                  380,881                  253,512 
    Advance billings on contracts                                    311,239                  395,872 
    Accrued salaries, wages and benefit plans                        288,699                  242,311 
    Other accrued liabilities                                        184,332                  198,348 
                                                                ------------------------------------- 
         Total current liabilities                                 1,648,081                1,620,375 
                                                                ------------------------------------- 

Long-term debt due after one year                                     17,576                   17,573 
Other noncurrent liabilities                                         401,827                  405,529 
Contingencies and commitments                                                                         
Shareholders' equity                                                                                  
    Capital stock                                                                                     
     Preferred - authorized 20,000,000 shares                                                         
      without par value; none issued                                      --                       -- 
     Common - authorized 150,000,000 shares                                                           
      ($0.01 par value at December 31, 2000, $0.625 par                                               
      value at October 31, 2000); issued and outstanding -                                            
      74,609,050 shares and 75,743,345 shares, respectively              746                   47,339 

     Additional capital                                              167,869                  212,107 
     Unamortized executive stock plan expense                        (32,411)                 (27,093)
     Accumulated other comprehensive income (loss)                   (42,719)                 (46,400)
     Retained earnings                                               539,592                1,423,304 
                                                                 ------------------------------------ 
         Total shareholders' equity                                  633,077                1,609,257 
                                                                 ------------------------------------ 
                                                                  $2,700,561               $3,652,734 
                                                                 ==================================== 

See Accompanying Notes.                                                         

* Amounts at October 31, 2000 have been derived from audited financial          
statements.                                                                 

4 

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FLOUR CORPORATION 
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS  
Two Months Ended December 31, 2000 and 1999 

UNAUDITED 

                                                        [Enlarge/Download Table]
$ in thousands                                                      2000           1999 
--------------------------------------------------------------------------------------- 
                                                                                        
CASH FLOWS FROM OPERATING ACTIVITIES                                                    
   Net earnings (loss)                                         $  (4,023)     $  27,828 
   Adjustments to reconcile net earnings (loss) to cash                                 
     provided (used) by operating activities:                                           
        Depreciation and amortization - continuing                                      
         operations                                               22,698         20,971 
        Depreciation, depletion and amortization -                                      
         discontinued operations                                      --         28,156 
        Deferred taxes                                            (4,534)         2,515 
        Changes in operating assets and liabilities,                                    
         excluding effects of business acquisitions/                                    
         dispositions                                            (56,378)       (52,820)
        Spin-off transaction expenses                            (13,493)            -- 
        Other, net                                                   830           (340)
                                                               ------------------------ 
Cash provided (used) by operating activities                     (54,900)        26,310 
                                                               ------------------------ 

CASH FLOWS FROM INVESTING ACTIVITIES                                                    
   Capital expenditures - continuing operations                  (36,364)       (54,324)
   Capital expenditures - discontinued operations                     --        (54,802)
   Proceeds from sale of property, plant and equipment            15,250         14,122 
   Investments, net                                                2,895         (5,765)
   Other, net                                                        130         (1,299)
                                                               ------------------------ 
Cash utilized by investing activities                            (18,089)      (102,068)
                                                               ------------------------ 
CASH FLOWS FROM FINANCING ACTIVITIES                                                    
   Increase in short-term borrowings                             127,128         80,276 
   Stock options exercised                                            39          1,645 
   Purchases of common stock                                    (101,233)            -- 
   Other, net                                                       (521)          (112)
                                                               ------------------------ 
Cash provided by financing activities                             25,413         81,809 
                                                               ------------------------ 
(Decrease) increase in cash and cash equivalents                 (47,576)         6,051 
Cash and cash equivalents at beginning of period                  69,426        209,614 
                                                               ------------------------ 
Cash and cash equivalents at end of period                     $  21,850      $ 215,665 
                                                               ======================== 

See Accompanying Notes.                                                         

5 

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FLUOR CORPORATION   
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  

UNAUDITED 

(1)  On November 30, 2000, a reverse spin-off distribution to shareholders was  
     effected which separated Fluor Corporation (Fluor) into two publicly-traded
    companies - a "new" Fluor ("New Fluor" or the "company") and Massey Energy
Company ("Massey"). The reverse spin-off was accomplished through the 
  distribution of 100% of the common stock of New Fluor to shareholders of
   existing Fluor. As a result, each existing Fluor shareholder received one
share of New Fluor common stock (par value $0.01) for each share of   
     existing Fluor common stock and retained their shares (par value $0.625) in
     existing Fluor, whose name was changed to Massey Energy Company. A total of
    74,279,876 shares of New Fluor common stock were issued as a result of the
 reverse spin-off. Because of the relative significance of the company's
   operations to Fluor, the company is treated as the "accounting successor"
for financial reporting purposes. Accordingly, Massey's results of    
     operations for the two months ended December 31, 1999 and its net assets as
of October 31, 2000 are presented as discontinued operations. Actual  
   operating results of Massey for the month of November 2000 were a loss of
 $0.9 million, which was in line with the amount included in the loss on
disposal recorded during the fourth quarter of fiscal 2000.           

     In connection with the reverse spin-off, the company changed to a calendar-
year basis of reporting financial results.  As a requirement of this  
    change, the company is reporting results for November and December 2000 as
a separate transition ("stub") period, with the results for the       
corresponding period of 1999 presented for comparative purposes.      

  The condensed consolidated financial statements do not include footnotes
and certain financial information normally presented annually under   
    generally accepted accounting principles and, therefore, should be read in
     conjunction with the company's October 31, 2000 annual report on Form 10-K.
Accounting measurements at interim dates inherently involve greater   
   reliance on estimates than at year-end. The results of operations for the
two months ended December 31, 2000 are not necessarily indicative of  
results that can be expected for a full year.                         

The condensed consolidated financial statements included herein are   
unaudited; however, they contain all adjustments (consisting of normal
    recurring accruals) which, in the opinion of the company, are necessary to
     present fairly its consolidated financial position at December 31, 2000 and
  its consolidated results of operations and cash flows for the two months
ended December 31, 2000 and 1999.                                     

     Certain October 31, 2000 amounts have been reclassified to conform with the
December 31, 2000 presentation.                                       

6 

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FLUOR CORPORATION   
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  
(CONTINUED) 

UNAUDITED 

(2)  Inventories comprise the following:                                        

                                                                [Download Table]

                                              December 31,    October 31,
$ in thousands                                       2000           2000 
-------------------------------------------------------------------------
                                                                         
Equipment for sale/rental                       $  81,511      $  71,280 
Supplies and other                                 35,053         35,431 
                                              ---------------------------
                                                $ 116,564      $ 106,711 
                                              ===========================

(3)  Short-term debt comprises the following:                                   

                                                                [Download Table]


                                              December 31,    October 31,
$ in thousands                                       2000           2000 
-------------------------------------------------------------------------
                                                                         
Commercial paper                                $ 191,720      $  59,442 
Note payable to affiliate                         153,088        164,812 
Notes payable to banks                             35,091         28,517 
Trade notes payable                                   982            741 
                                              ---------------------------
                                                $ 380,881      $ 253,512 
                                              ===========================

(4)  Total comprehensive income (loss) represents the net change in             
   shareholders' equity during a period from sources other than transactions
with shareholders and as such, includes net earnings (loss).  For the 
   company, the only other component of total comprehensive income (loss) is
the change in the cumulative foreign currency translation adjustments 
recorded in shareholders' equity.                                     

   The components of comprehensive income (loss), net of related tax, are as
follows:                                                              

                                                                [Download Table]

                                            Two Months Ended December 31,
                                          -------------------------------
$ in thousands                                      2000          1999   
-------------------------------------------------------------------------
                                                                         
Net earnings (loss)                             $ (4,023)       $ 27,828 
Foreign currency translation adjustment            3,681           2,371 
                                          -------------------------------
Comprehensive income (loss)                     $   (342)       $ 30,199 
                                          ===============================

7 

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FLUOR CORPORATION   
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  
(CONTINUED) 

UNAUDITED 

(5)  Cash paid for interest was $6.0 million and $6.3 million for the two month 
periods ended December 31, 2000 and 1999, respectively.  Income tax   
  payments, net of receipts, were $3.1 million and $0.6 million during the
two month periods ended December 31, 2000 and 1999, respectively.     

(6)  In connection with the company's 1997/1998 share repurchase program, the   
  company entered into a forward purchase contract for 1,850,000 shares of
its common stock.  The contract was settled for cash of $101.2 million
   ($54.72 per share) on November 30, 2000, immediately prior to the reverse
spin-off distribution to shareholders.                                

(7)  Operating information by segment for the company's continuing operations   
are as follows for the two months ended December 31, 2000 and 1999:   

                                                                [Download Table]

                                           Fluor         Fluor             
                             Fluor         Global      Signature           
$ in millions                Daniel       Services      Services    Total  
---------------------------------------------------------------------------
                                                                           
2000                                                                       
External revenues           $1,318.4       $544.6      $ 3.5      $1,866.5 
Operating profit (loss)     $   28.4       $ 13.7      $(1.6)     $   40.5 

1999                                                                       
External revenues           $1,175.5       $547.2      $   -      $1,722.7 
Operating profit (loss)     $   27.5       $ 18.8      $(1.3)     $   45.0 


     Reconciliation of Segment Information to Consolidated Amounts - For the two
months ended December 31, 2000 and 1999:                              

                                                                [Download Table]


$ in millions                                              2000       1999 
---------------------------------------------------------------------------
                                                                           
Total segment operating profit                            $ 40.5    $ 45.0 
Corporate administrative and general expense               (42.0)*   (15.3)
Interest expense, net                                       (5.0)     (1.1)
Other items, net                                            (0.6)     (1.4)
                                                         ------------------
Earnings (loss) from continuing operations before taxes   $ (7.1)   $ 27.2 
                                                         ==================

   * In connection with the separation of Massey from Fluor, all stock-price
     driven compensation plans were adjusted to preserve the value of such plans
    on the date of the distribution.  During the two months ended December 31,
    2000, a charge totaling $24.0 million was recorded to reflect the increase
    in the "new" Fluor stock price from the date of conversion to December 31,
2000.                                                                 

8 

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FLUOR CORPORATION   
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  
(CONTINUED) 

UNAUDITED 

(8)  Effective November 1, 2000, the company adopted Statement of Financial     
 Accounting Standard No. 133, "Accounting for Derivative Instruments and
Hedging Activities," (SFAS 133) as amended, which requires that all   
     derivative instruments be reported on the balance sheet at fair value.  The
adoption of SFAS 133 did not have a material effect on the company's  
financial statements.                                                 

The company uses forward exchange contracts to hedge certain foreign  
    currency transactions entered into in the ordinary course of business. The
company does not engage in currency speculation. The company's forward
exchange contracts do not subject the company to significant risk from
   exchange rate movements because gains and losses on such contracts offset
losses and gains, respectively, in the transactions being hedged.     

The company formally documents its hedge relationships at inception,  
   including identification of the hedging instruments and the hedged items,
  as well as its risk management objectives and strategies for undertaking
     the hedge transaction. The company also formally assesses both at inception
     and at least quarterly thereafter, whether the derivatives that are used in
     hedging transactions are highly effective in offsetting changes in the fair
value of the hedged items.                                            

   The company generally limits exposure to foreign currency fluctuations in
    most of its engineering and construction contracts through provisions that
   require client payments in U.S. dollars or other currencies corresponding
to the currency in which costs are incurred. As a result, the company 
   generally does not need to hedge foreign currency cash flows for contract
    work performed. Under certain limited circumstances, such foreign currency
    payment provisions could be deemed embedded derivatives under SFAS 133. At
   the November 1, 2000 implementation date and as of December 31, 2000, the
  company had no significant embedded derivatives in any of its contracts.

9 

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FLUOR CORPORATION 
MANAGEMENT'S DISCUSSION AND ANALYSIS OF 
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 

The following discussion and analysis is provided to increase understanding of, 
and should be read in conjunction with, the condensed consolidated financial    
statements and accompanying notes and the company's October 31, 2000 annual     
report on Form 10-K. For purposes of reviewing this document, "operating profit"
is calculated as revenues less cost of revenues excluding: corporate            
administrative and general expense; interest expense; interest income; domestic 
and foreign income taxes; gain or loss on discontinued operations; the          
cumulative effect of a change in accounting principles; and certain other       
miscellaneous non-operating income and expense items which are immaterial.      

FORWARD-LOOKING INFORMATION                                                     

Statements regarding the company's expectations regarding projected earning     
levels, market outlook, new awards, backlog levels, competition, the adequacy of
funds to service debt and the implementation of new strategic initiatives are   
forward looking in nature. These forward-looking statements reflect the         
company's current analysis of existing information. As a result, caution must be
exercised in relying on forward-looking statements. Due to unknown risks, the   
company's actual results may differ materially from its expectations or         
projections. The 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;                            
.  Difficulties and delays incurred in the implementation of strategic        
initiatives;                                                              
.  Risks and impacts resulting from the company's reverse spin-off transaction
consummated on November 30, 2000 involving Massey Energy Company;         
 . Competition in the global engineering, procurement 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. In addition, while most risks affect only future costs or revenues 
that the company anticipates it will receive, some risks may relate to accruals 
that have already been reflected in earnings. The company's failure to receive  
payments of these accrued earnings could result in charges against future       
earnings.                                                                       

10

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Additional information concerning factors that may influence the company's      
results can be found in press releases and periodic filings with the Securities 
and Exchange Commission including the discussion under the heading "Item 1.     
Business - Other Matters - Company Business Risks" in the company's Form 10-K   
for its fiscal year ended October 31, 2000 that was filed with the Securities   
and Exchange Commission on January 29, 2001. These 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.                                                             

RESULTS OF CONTINUING OPERATIONS                                                

Revenues for the two-month period ended December 31, 2000 increased 8 percent   
compared with the same period of 1999. Net loss from continuing operations for  
the two-month period ended December 31, 2000 was $4.0 million compared with net 
earnings of $18.6 million for the same period of 1999. Operating results for the
two months ended December 31, 2000 were impacted by an unusual compensation     
charge totaling $15.6 million after tax. In connection with the reverse spin-off
of Massey Energy Company, all stock-based compensation plans were adjusted to   
preserve the value of such plans on the date of the distribution. The charge    
reflects the impact of the increase in the "new" Fluor stock price from the date
of conversion to December 31, 2000. Excluding the unusual item, net earnings    
from continuing operations for the two months ended December 31, 2000 were $11.6
million ($0.16 per diluted share) compared with $18.6 million ($0.24 per diluted
share) reported for the respective period of 1999.                              

FLUOR DANIEL                                                                    

Revenues and operating profit for the Fluor Daniel segment for the two-month    
periods ended December 31, 2000 and 1999 are summarized as follows:             

                                                                [Download Table]

                                      Two Months Ended December 31, 
                                      ------------------------------
$ in millions                            2000                1999   
--------------------------------------------------------------------
                                                                    

Revenues                               $1,318.4             $1,175.5
Operating profit                       $   28.4             $   27.5

Revenues increased by 12 percent for the two-month period ended December 31,    
2000 compared with the same period of 1999, primarily due to an increase in work
performed, which is consistent with the upward trend in new awards experienced  
during the fourth quarter of fiscal 2000.                                       

Operating profit increased slightly for the two-month period ended December 31, 
2000 compared with the same period of 1999.  Expressed as a percentage of       
revenues, the operating margin was 2.2 percent for the two-month period of 2000,
a slight decline from the 2.3 percent realized in the corresponding 1999 period.

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New awards for the two months ended December 31, 2000 were $859.6 million,      
compared with $761.3 million for the same period of 1999. Approximately 40      
percent of the new awards for the two months ended December 31, 2000 were for   
projects located outside of the United States.                                  

The following table sets forth backlog for each of the segment's business units:

                                                        [Enlarge/Download Table]

                                   December 31,        October 31,       December 31,
$ in millions                             2000               2000               1999 
------------------------------------------------------------------------------------ 
                                                                                     
Energy & Chemicals                      $4,666             $4,356             $4,464 
Manufacturing & Life Sciences            1,039              1,078              1,378 
Mining                                     694                964                394 
Infrastructure                             303                332                328 
                                   ------------------------------------------------- 
Total backlog                           $6,702             $6,730             $6,564 
                                   ================================================= 

United States                           $2,976             $2,968             $2,757 
International                            3,726              3,762              3,807 
                                   ------------------------------------------------- 
Total backlog                           $6,702             $6,730             $6,564 
                                   ================================================= 

The increase in total backlog compared with December 31, 1999 is consistent with
the recent improving trend in new awards. Although backlog reflects business    
which is considered to be firm, cancellations or scope adjustments may occur.   
Backlog is adjusted to reflect any known project cancellations, deferrals and   
revised project scope and cost, both upward and downward.                       

FLUOR GLOBAL SERVICES                                                           

Revenues and operating profit for the Fluor Global Services segment for the two-
month periods ended December 31, 2000 and 1999 are summarized as follows:       

                                                                [Download Table]

                                      Two Months Ended December 31, 
                                      ------------------------------
$ in millions                            2000                1999   
--------------------------------------------------------------------
                                                                    
Revenues                                 $544.6              $547.2 
Operating profit                         $ 13.7              $ 18.8 

Although revenues were essentially unchanged for the two months ended December  
31, 2000 compared with the same period of 1999, operating profits declined due  
to the timing of earnings on a number of large contracts.                       

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New awards for the two months ended December 31, 2000 were $177.5 million       
compared with $254.2 million for the same period of 1999.  New awards for the   
two months ended December 31, 2000 were almost entirely for domestic projects.  
The nature and size of Fluor Global Services projects can result in variability 
in new award levels from period to period.                                      

The following table sets forth backlog for each of the segment's business units:

                                                                [Download Table]

                                December 31,         October 31,        December 31,
$ in millions                           2000                2000                1999
------------------------------------------------------------------------------------
                                                                                    
Operations & Maintenance              $1,579              $1,571              $1,048
Telecommunications                       884                 946                 480
Fluor Federal Services                   602                 765                 655
                                 ---------------------------------------------------
Total backlog                         $3,065              $3,282              $2,183
                                 ===================================================

United States                         $2,547              $2,712              $1,965
International                            518                 570                 218
                                 ---------------------------------------------------
Total backlog                         $3,065              $3,282              $2,183
                                 ===================================================

The increase in total backlog at December 31, 2000 compared with December 31,   
1999 is consistent with growth in new awards that occurred during fiscal year   
2000.  The decline in backlog since the end of fiscal 2000 reflects the reduced 
level of new awards during the two-month stub period.  Although backlog reflects
business which is considered to be firm, cancellations or scope adjustments may 
occur.  Backlog is adjusted to reflect any known project cancellations,         
deferrals and revised project scope and cost, both upward and downward.         

FLUOR SIGNATURE SERVICES                                                        

The Fluor Signature Services segment, the company's shared services enterprise, 
reported an operating loss of $1.6 million during the two months ended December 
31, 2000, compared with an operating loss of $1.3 million during the            
corresponding period of 1999.  The segment commenced operations at the beginning
of fiscal 1999.                                                                 

OTHER                                                                           

Net interest expense for the two month period ended December 31, 2000 increased 
by $3.9 million compared with the corresponding period of 1999 as the combined  
result of higher levels of short-term debt and an increase in interest rates for
commercial paper during 2000.                                                   

Corporate administrative and general expense for the two months ended December  
31, 2000 was $26.7 million higher compared with the same period in 1999 as the  
principal result of two factors. First, costs related to the company's          
Enterprise Resource Management system, Knowledge@Work, totaled $7.3 million     
during the two months ended December 31, 2000, compared with $3.0 million during
the corresponding period of 1999. Costs for the 2000 period include operating   
expenses following the successful initial implementation of certain applications

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at the end of fiscal 2000 as well as expenditures for continuing development of 
other applications. Second, as discussed above, an unusual compensation charge  
of $24.0 million pretax ($15.6 million after tax) was recorded during the 2000  
period.                                                                         

The effective tax rate of the company's continuing operations, exclusive of the 
impact of the unusual compensation charge, was 31.5 percent.  This rate is      
unchanged as compared with prior year results for the same reporting period.    

DISCONTINUED OPERATIONS                                                         

The company recorded a $25.0 million loss on disposal during the fourth         
quarter of fiscal 2000, which included a provision for the expected operating   
results of Massey Energy Company between October 31, 2000 and November 30, 2000.
Actual operating results of Massey Energy Company for the month of November 2000
were a loss of $0.9 million, which was in line with the amount included in the  
loss on disposal. Therefore, no results of discontinued operations are reported 
for the two months ended December 31, 2000. For the 1999 period, revenues for   
discontinued operations were $176.6 million.                                    

FINANCIAL POSITION AND LIQUIDITY                                                

At December 31, 2000, the company had cash and cash equivalents of $21.9 million
and a total debt to total capitalization ratio of 38.6 percent, compared with   
cash and cash equivalents of $69.4 million and a pro forma (as if the reverse   
spin-off had occurred on October 31, 2000) total debt to total capitalization   
ratio of 36.7 percent at the end of fiscal year 2000.                           

Cash used by operating activities was $54.9 million during the two-month period 
ended December 31, 2000, compared with cash provided by operating activities of 
$26.3 million during the same period in 1999.  This change is primarily due to  
the lower level of earnings during the 2000 period, combined with reduced       
depreciation and amortization following the reverse spin-off of Massey Energy   
Company and the payment of costs associated with that transaction during the    
2000 period.                                                                    

Cash utilized by investing activities totaled $18.1 million during the two-month
period ended December 31, 2000 compared with $102.1 million during the same     
period in 1999.  The 1999 amount includes $54.8 million of capital expenditures 
for discontinued operations.  Also, capital expenditures for continuing         
operations decreased by $18.0 million during 2000 relative to the 1999 period.  

Cash provided by financing activities totaled $25.4 million during the two-month
period ended December 31, 2000 compared with $81.8 million for the same period  
in 1999.  During 2000, the company increased its short-term borrowings by $127.1
million, including increases in commercial paper of $132.3 million and notes    
payable to banks of $6.5 million.  The company decreased its note payable to    
affiliate by $11.7 million during 2000 period.  On November 30, 2000, prior to  
the reverse spin-off of Massey Energy Company, the company settled a forward    
purchase contract for 1,850,000 shares of common stock entered into in          
connection with its 1997/1998 share repurchase program for cash of $101.2       
million ($54.72 per share).                                                     

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The company has on hand and access to sufficient sources of funds to meet its   
anticipated operating needs.  Significant short- and long-term lines of credit  
are maintained with banks which, along with cash on hand, provide adequate      
operating liquidity.  Liquidity is also provided by the company's commercial    
paper program.                                                                  

FINANCIAL INSTRUMENTS                                                           

The company utilizes forward exchange contracts to hedge foreign currency       
transactions entered into in the ordinary course of business and not to engage  
in currency speculation.  At December 31, 2000 and October 31, 2000, the company
had forward foreign exchange contracts of less than 18 months duration to       
exchange principally Euros, Australian dollars, British pounds, Canadian        
dollars, Czech korunas, Dutch guilders, German marks and Spanish pesetas for    
U.S. dollars.  The total gross notional amount of these contracts at December   
31, 2000 and October 31, 2000 was $73.0 million and $71.0 million, respectively.
Forward contracts to purchase foreign currency amounted to $72.6 million and    
$66.0 million and forward contracts to sell foreign currency totaled $0.4       
million and $5.0 million at December 31, 2000 and October 31, 2000,             
respectively.                                                                   

NEW ACCOUNTING PRONOUNCEMENTS                                                   

Effective November 1, 2000, the company adopted Statement of Financial          
Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging
Activities," (SFAS 133) as amended. The adoption of SFAS 133 did not have a     
material effect on the company's financial statements.                          

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FLUOR CORPORATION 
CHANGES IN CONSOLIDATED BACKLOG 
Two Months Ended December 31, 2000 and 1999 

UNAUDITED 

                                                        [Enlarge/Download Table]

                                                      Two Months Ended December 31,  
                                                     --------------------------------
$ in millions                                              2000              1999    
-------------------------------------------------------------------------------------
                                                                                     
Backlog - beginning of period                          $10,012.2          $ 9,142.0  
New awards                                               1,037.1            1,015.5  
Adjustments and cancellations, net                         468.9              187.8  
Work performed                                          (1,751.5)          (1,597.9) 
                                                       ------------------------------
Backlog - end of period                                $ 9,766.7          $ 8,747.4  
                                                       ==============================

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PART II:  Other Information 

Item 6.  Exhibits and Reports on Form 8-K.                                      

(a)   Exhibits.                                               

None                                              

(b)   Reports on Form 8-K.                                    

               The company filed Form 8-K's on December 7, 2000 and December 29,
        2000 which included various agreements associated with the
           reverse spin-off transaction and resulting changes to certain
incentive plans.                                  

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SIGNATURES  

Pursuant to the requirements of the Securities Exchange Act of 1934, the        
registrant has duly caused this report to be signed on its behalf by the        
undersigned thereunto duly authorized.                                          

                                     FLUOR CORPORATION
                                    --------------------------------------------
                                      (Registrant)

Date: February 14, 2001             /s/ R. F. Hake                              
      -----------------             --------------------------------------------
                                R. F. Hake, Executive Vice President and
               Chief Financial Officer

         /s/ V. L. Prechtl
                                    --------------------------------------------
                                    V. L. Prechtl, Vice President and Controller

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Dates Referenced Herein and Documents Incorporated by Reference

		Referenced-On Page
This ‘10-QT’ Filing	Date	First	Last	Other Filings

Filed on:	2/14/01	19
	1/31/01	1
	1/29/01	12		10-K
For Period End:	12/31/00	1	17
	12/29/00	18		S-8
	12/7/00	18		8-K
	11/30/00	7	15	8-K
	11/1/00	1	16
	10/31/00	2	16	10-K
	12/31/99	2	17
				List all Filings

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Filing Submission 0001017062-01-000335 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Fluor Corp – ‘10-QT’ for 12/31/00

On: Wednesday, 2/14/01, at 5:14pm ET · For: 12/31/00 · Accession #: 1017062-1-335 · File #: 1-16129

Quarterly-Transition Report — Form 10-QFiling Table of Contents

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Dates Referenced Herein and Documents Incorporated by Reference

Quarterly-Transition Report — Form 10-Q
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