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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(MARK ONE)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JULY 31, 1997
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ____________TO_____________
Commission File Number: 1-7775
FLUOR CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 95-0740960
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(State or other jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
3353 Michelson Drive, Irvine, CA 92698
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(Address of principal executive offices)
(714) 975-2000
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(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 August 31, 1997 there were 83,832,685 shares of common stock outstanding.
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FLUOR CORPORATION
FORM 10-Q
JULY 31, 1997
TABLE OF CONTENTS PAGE
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PART I: FINANCIAL INFORMATION
Condensed Consolidated Statement of Earnings for the Three Months
Ended July 31, 1997 and 1996.................................................... 2
Condensed Consolidated Statement of Earnings for the Nine Months
Ended July 31, 1997 and 1996.................................................... 3
Condensed Consolidated Balance Sheet at July 31, 1997 and
October 31, 1996................................................................ 4
Condensed Consolidated Statement of Cash Flows for the Nine
Months Ended July 31, 1997 and 1996............................................. 6
Notes to Condensed Consolidated Financial Statements.............................. 7
Management's Discussion and Analysis of Financial Condition and
Results of Operations........................................................... 9
Changes in Backlog................................................................ 15
PART II: OTHER INFORMATION............................................................. 16
SIGNATURES................................................................................. 17
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PART I: FINANCIAL INFORMATION
FLUOR CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF EARNINGS
Three Months Ended July 31, 1997 and 1996
UNAUDITED
In thousands, except per share amounts 1997 1996
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REVENUES $ 3,675,905 $ 2,702,821
COSTS AND EXPENSES
Cost of revenues 3,567,314 2,589,959
Corporate administrative and general expenses 4,654 9,956
Interest expense 7,520 4,500
Interest income (5,627) (6,460)
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Total Costs and Expenses 3,573,861 2,597,955
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EARNINGS BEFORE INCOME TAXES 102,044 104,866
INCOME TAX EXPENSE 35,802 36,789
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NET EARNINGS $ 66,242 $ 68,077
============================
NET EARNINGS PER SHARE $ 0.79 $ 0.81
============================
DIVIDENDS PER COMMON SHARE $ 0.19 $ 0.17
============================
SHARES USED TO CALCULATE
EARNINGS PER SHARE 84,345 84,558
============================
See Accompanying Notes.
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FLUOR CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF EARNINGS
Nine Months Ended July 31, 1997 and 1996
UNAUDITED
In thousands, except per share amounts 1997 1996
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REVENUES $ 10,295,799 $ 7,687,464
COSTS AND EXPENSES
Cost of revenues 10,154,270 7,370,476
Corporate administrative and general expenses 18,721 34,553
Interest expense 20,044 11,416
Interest income (16,498) (20,692)
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Total Costs and Expenses 10,176,537 7,395,753
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EARNINGS BEFORE INCOME TAXES 119,262 291,711
INCOME TAX EXPENSE 61,119 102,486
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NET EARNINGS $ 58,143 $ 189,225
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NET EARNINGS PER SHARE $ 0.69 $ 2.24
==============================
DIVIDENDS PER COMMON SHARE $ 0.57 $ 0.51
==============================
SHARES USED TO CALCULATE
EARNINGS PER SHARE 84,572 84,543
==============================
See Accompanying Notes.
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FLUOR CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
July 31, 1997 and October 31, 1996
UNAUDITED
July 31, October 31,
$ in thousands 1997 1996*
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ASSETS
Current Assets
Cash and cash equivalents $ 198,319 $ 246,964
Marketable securities 33,960 69,378
Accounts and notes receivable 847,235 742,547
Contract work in progress 649,259 561,490
Deferred taxes 61,763 50,157
Inventory and other current assets 216,342 126,287
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Total current assets 2,006,878 1,796,823
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Property, Plant and Equipment (net of accumulated
depreciation, depletion and amortization of $954,552
and $821,212, respectively) 1,861,307 1,677,662
Investments and goodwill, net 249,229 192,879
Other 299,713 284,362
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$4,417,127 $3,951,726
=========================
(Continued On Next Page)
* Amounts at October 31, 1996 have been derived from audited financial
statements.
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FLUOR CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
July 31, 1997 and October 31, 1996
UNAUDITED
July 31, October 31,
$ in thousands 1997 1996*
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts and notes payable $ 704,104 $ 704,186
Commercial paper 84,481 29,916
Advance billings on contracts 483,375 445,807
Accrued salaries, wages and benefit plans 292,900 290,426
Other accrued liabilities 241,291 175,026
Current portion of long-term debt 139 207
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Total current liabilities 1,806,290 1,645,568
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Long-term debt 300,524 2,967
Deferred taxes 62,458 42,632
Other noncurrent liabilities 567,975 590,833
Commitments and Contingencies
Shareholders' Equity
Capital stock
Preferred - authorized 20,000,000
shares without par value; none issued
Common - authorized 150,000,000
shares of $0.625 par value; issued and outstanding -
83,849,305 shares and 83,791,197
shares, respectively 52,406 52,369
Additional capital 574,835 573,037
Retained earnings 1,087,923 1,077,559
Unamortized executive stock plan expense (28,084) (32,538)
Cumulative translation adjustment (7,200) (701)
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Total shareholders' equity 1,679,880 1,669,726
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$ 4,417,127 $ 3,951,726
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See Accompanying Notes.
* Amounts at October 31, 1996 have been derived from audited financial
statements.
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FLUOR CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Nine Months Ended July 31, 1997 and 1996
UNAUDITED
$ in thousands 1997 1996
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CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings $ 58,143 $ 189,225
Adjustments to reconcile net earnings to cash provided
by operating activities:
Depreciation, depletion and amortization 183,363 139,929
Deferred taxes 11,440 11,564
Change in operating assets and liabilities (138,584) (21,288)
Other, net (19,701) (15,005)
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Cash provided by operating activities 94,661 304,425
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CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures (350,940) (289,404)
E & C businesses acquired (141,718) (80,216)
Proceeds from sales/maturities of marketable securities 35,418 88,897
Purchase of marketable securities -- (64,052)
Proceeds from sale of property, plant and equipment 32,860 20,317
Investments, net 1,793 (6,580)
Trust fund contribution (21,513) --
Other, net (3,012) (9,775)
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Cash utilized by investing activities (447,112) (340,813)
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CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of long-term debt 300,121 --
Increase in short-term borrowings 57,757 17,373
Payments on long-term debt (1,185) (18,801)
Cash dividends paid (47,779) (42,590)
Common stock repurchased (18,973) --
Stock options exercised 15,099 15,311
Other, net (1,234) 764
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Cash provided (utilized) by financing activities 303,806 (27,943)
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Decrease in cash and cash equivalents (48,645) (64,331)
Cash and cash equivalents at beginning of period 246,964 292,934
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Cash and cash equivalents at end of period $ 198,319 $ 228,603
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See Accompanying Notes.
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FLUOR CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
UNAUDITED
(1) 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, 1996 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 three and nine
months ended July 31, 1997 are not necessarily indicative of results that
can be expected for the 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 July 31, 1997 and its
consolidated results of operations and cash flows for the three and nine
months ended July 31, 1997 and 1996. As more fully described in Management's
Discussion and Analysis of Financial Condition and Results of Operations
("MD&A"), the Company recorded provisions totaling $118.2 million during the
second quarter of 1997. These included provisions for estimated losses on
certain contracts and adjustments to project-related investments and
accounts receivable.
Certain 1996 amounts have been reclassified to conform with the 1997
presentation.
(2) Earnings per share is based on the weighted average number of common and,
when appropriate, common equivalent shares outstanding in each period.
Common equivalent shares are included when the effect of the potential
exercise of stock options is dilutive.
(3) Inventories comprise the following:
July 31, October 31,
$ in thousands 1997 1996
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Coal $ 43,547 $ 28,809
Supplies and other 113,422 45,118
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$156,969 $ 73,927
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The increase in inventories is primarily related to the Company's
acquisition of two equipment rental and sales companies during the third
quarter of 1997. See MD&A for further discussion.
(4) Cash paid for interest was $9.9 million and $6.9 million for the nine month
periods ended July 31, 1997 and 1996, respectively. Income tax payments, net
of refunds, were $51.0
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million and $82.2 million during the nine month periods ended July 31, 1997
and 1996, respectively.
(5) During the second quarter of 1997, the Company recorded a $19.9 million
charge related to the implementation of certain cost reduction initiatives.
An additional charge of $1.0 million was recorded in the third quarter.
These charges provide for personnel and facility related costs. As of July
31, 1997, approximately $3.2 million of these costs have been incurred. See
MD&A for further discussion.
(6) The Company's utilization of derivative financial instruments is
substantially limited to the use of forward exchange contracts to hedge
foreign currency transactions entered into in the ordinary course of
business and not to engage in currency speculation. These contracts are
entered into in order to hedge firm, identifiable, foreign currency
commitments. Accordingly, the unrealized gains and losses are deferred and
included in the measurement of contract work in progress. Upon maturity, any
realized gains and losses are charged against project costs.
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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 included herein and the Company's October 31,
1996 annual report on Form 10-K.
FORWARD-LOOKING INFORMATION
Any of the comments in this Form 10-Q that refer to the Company's estimated or
future results, including its estimates of the cost savings, and the timing of
cost savings, from its previously announced cost reduction program and its
statements concerning the adequacy of its provisions for estimated future losses
on projects or investments, are forward-looking and reflect the Company's
current analysis of existing trends and information. Actual results may differ
materially from current expectations or projections based on a number of factors
affecting the Company's businesses. These factors include, in the case of the
cost savings estimates, the ability to achieve estimated staff reductions while
maintaining workflow in the functional areas affected and to sublease vacated
facilities within anticipated time frames at anticipated sublease rent levels.
Other risk factors affecting the Company's estimated or future results include,
but are not limited to, cost overruns on fixed, maximum or unit-priced
contracts, contract performance risk, the uncertain timing of awards and
revenues under contracts, project financing risk, credit risk, risks associated
with government funding of contracts, market conditions impacting realization of
investments, market conditions in the domestic and international coal market,
relatively mild weather conditions which may lower demand for steam coal and the
state of the economic and political conditions worldwide. These forward-looking
statements represent the Company's judgment only as of the date of this Form
10-Q. As a result, the reader is cautioned not to rely on these forward-looking
statements. The Company disclaims any intent or obligation to update these
forward-looking statements.
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 "Certain
Factors and Trends Affecting Fluor and Its Businesses--Forward-Looking
Statements" in the Company's Form 8-K filed May 6, 1997, which is hereby
incorporated by reference and attached hereto as Exhibit 99.1.
RESULTS OF OPERATIONS
Revenues increased 36 percent and 34 percent, respectively, for the three and
nine month periods ended July 31, 1997 compared with the same periods of 1996.
Net earnings were $66.2 million and $58.1 million, respectively, for the three
and nine month periods ended July 31, 1997, compared with net earnings of $68.1
million and $189.2 million, respectively, for the comparable periods in 1996.
Results for the three and nine month periods ended July 31, 1997 were adversely
impacted by reduced earnings from the Engineering and Construction segment and
higher net interest expense, partially offset by higher earnings from the Coal
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segment and lower corporate administrative and general expenses, compared with
the same periods of 1996.
ENGINEERING AND CONSTRUCTION
Revenues for the Engineering and Construction segment increased 39 percent and
36 percent, respectively, for the three and nine month periods ended July 31,
1997 compared with the same periods of 1996, due primarily to an increase in the
volume of work performed. The increase in work performed is primarily a result
of the increase in new awards in recent periods. Despite the increase in
revenues, operating profits for the segment decreased 11 percent and 85 percent,
respectively, for the three and nine month periods ended July 31, 1997 compared
with the same periods of 1996.
Operating margins for the three and nine month periods ended July 31, 1997 were
adversely impacted by a variety of factors, including lower incentive fees
earned, delays in the full release of certain projects, a reduction in
recoveries for United States Government work, failure to achieve cost
projections on certain contracts and competitive pricing within certain
operating companies. In addition, benefits realized in the third quarter of 1997
from the Company's cost reduction initiatives were limited and are not expected
to be fully realized until fiscal year 1998. As such, operating margins for the
Engineering and Construction segment were impacted by ongoing costs for units
identified for reduction or redirection as well as investment and infrastructure
costs associated with market expansion in certain industries and regions. As
discussed below, results for the nine month period ended July 31, 1997 were
significantly affected by items from the Company's first and second quarters.
Provisions of $91.4 million for estimated losses on certain contracts were
recognized in the second quarter of 1997. Approximately 75 percent of the
contract provisions pertained to cost overruns on one fixed price project for
the construction of a power plant located outside the United States. During the
second quarter, the Company experienced substantial unexpected difficulties on
this project including significant ongoing design changes, long delays in
approval of drawings and vendors and resulting low productivity in the field. By
the end of the second quarter, these difficulties were substantially resolved as
to the first phase of the project and rendered more predictable as to the second
phase of the project. Accordingly, in the second quarter the Company recorded a
provision to recognize the estimated total amount of the loss under the
contract. No additional provision related to this project was recorded in the
third quarter. Also included in the second quarter provisions were certain other
projects identified to be loss contracts. None of these provisions individually
exceeded $5 million. No material additional provisions related to these projects
were recorded in the third quarter.
Additionally, during the second quarter of 1997, the Company recorded $26.8
million in provisions for the impairment, abandonment or sale of certain project
related investments and joint ventures, and doubtful accounts receivable, none
of which individually exceeded $5 million. These included the anticipated sale
of the Company's interest in a joint venture within the pulp and paper industry,
a write down of an equity investment obtained in exchange for services rendered
to an environmental technology company and certain other project joint
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ventures where it was determined in the second quarter that the Company's
investment was not expected to be realized due to poor market conditions or
cancellation of the project concerned.
Results for the nine months ended July 31, 1997 include a second quarter charge
of $19.9 million and a third quarter charge of $1.0 million related to
implementation of certain cost reduction initiatives. These charges consist of
personnel-related costs and lease costs for excess facilities. As of July 31,
1997, approximately $3.2 million of these costs have been incurred. To date, the
Company has initiated action to downsize, consolidate or close 17 of its more
than 80 offices and has consolidated certain industry operating companies.
Additional charges may be taken later in the year as further actions are
initiated. Upon full implementation of the cost reduction initiatives, the
Company believes that annualized savings of $100 million can be achieved. The
Company believes that all action items in connection with the cost reduction
initiatives will be completed by the end of the fiscal year. The Company
anticipates that the cash flow impact of the costs to implement these savings
initiatives will not have a material impact on current or future periods.
Results for the nine months ended July 31, 1997 include first quarter
contract-related provisions totaling $21.0 million for cost overruns on two
fixed price power projects, including the power project located outside the
United States. The loss in the first quarter on this project reflected
additional costs then identified to be incurred on the first phase of the
project arising primarily from bad weather, lack of timely site access,
unexpected design changes and low labor productivity. The loss on the other
project, which is located in the United States and was due primarily to startup
problems, craft employee turnover and operation of the plant control system, is
not expected to exceed the provision recorded in the first quarter. The Company
also recognized in the first quarter a credit totaling $25.0 million related to
certain actuarially determined insurance accruals. The insurance accrual
adjustment was due primarily to improvement in loss experience resulting from
the Company's safety program, resulting in an excess accrual position. The
Company believes that the accrued liability at July 31, 1997 represents the best
estimate of its insurance liability.
New awards for the three and nine months ended July 31, 1997 were $2.7 billion
and $9.4 billion, respectively, compared with $3.1 billion and $9.1 billion for
the same periods of 1996. Approximately 38 percent and 53 percent, respectively,
of new awards for the three and nine months ended July 31, 1997 were for
projects located outside of the United States. New awards in the third quarter
of 1997 consisted of smaller projects; there were no individual new awards above
$200 million in value. The uncertain timing of prospects for new awards, some of
which are large, can create variability in the Company's awards pattern.
Consequently, future award trends are difficult to predict with certainty.
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The following table sets forth backlog for each of the Company's Engineering and
Construction groups:
July 31, October 31, July 31,
$ in millions 1997 1996 1996
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Process $ 6,994 $ 4,903 $ 6,125
Industrial 5,397 6,496 5,974
Power/Government 2,054 3,621 2,852
Diversified Services 896 737 648
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Total backlog $15,341 $15,757 $15,599
=======================================
U.S $ 6,373 $ 7,326 $ 6,853
Outside U.S 8,968 8,431 8,746
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Total backlog $15,341 $15,757 $15,599
=======================================
The increase in the Process Group's backlog at July 31, 1997 compared with
October 31, 1996 was due primarily to the 1997 award of the $1.9 billion Yanpet
project, a petrochemical complex to be constructed in Saudi Arabia. The
reduction in backlog since October 31, 1996 in the Industrial Group reflects
lower new awards in the first nine months of 1997 compared with the last nine
months of 1996. Backlog in the Power/Government Group declined from October 31,
1996 compared with July 31, 1997 due primarily to the work performed on the
Hanford and Fernald environmental cleanup projects and the Paiton power project.
The increase in backlog from projects located outside the United States since
October 31, 1996, is primarily due to the Yanpet Project. Backlog is adjusted
both upward and downward as required to reflect project cancellations, deferrals
and revised project scope and cost. These adjustments were not significant for
the three and nine months ended July 31, 1997 and 1996, respectively.
COAL
Revenues increased 8 percent and 11 percent, respectively, for the three and
nine month periods ended July 31, 1997 compared with the same periods of 1996.
These increases were due primarily to increased sales volume of both
metallurgical and steam coal, partially offset by lower steam coal prices. The
increase in metallurgical coal revenues is due primarily to an increased market
share of sales to steel producers, reflecting a stronger economy. There has
been a general softening in prices within the entire steam coal market as
overall demand is down due to both a mild winter and summer. Despite lower steam
coal prices, revenues increased due primarily to the addition of a number of new
electric utility customers. Gross profit and operating profit increased for the
three and nine months ended July 31, 1997 compared with the same periods of 1996
due primarily to the increased sales volume of both metallurgical and
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steam coal and lower costs of both steam and metallurgical coal. Operating
profit increased 12 percent and 15 percent, respectively, for the three and nine
months ended July 31, 1997 compared with the same periods of 1996.
OTHER
Net interest for the three and nine months ended July 31, 1997 decreased
compared with the same periods of 1996 due primarily to higher long-term
interest bearing liabilities in addition to lower interest earning assets.
Corporate administrative and general expenses decreased $5.3 million and $15.8
million, respectively, for the three and nine month periods ended July 31, 1997
compared with the same periods of 1996. The reduction in expense is due
primarily to lower accruals for stock-related and performance-based
compensation plans and lower corporate overhead.
The effective tax rate for the nine month period ended July 31, 1997 was
materially impacted by foreign-based project losses, other project-related
investment losses and certain implementation costs for cost reduction
initiatives incurred in the second quarter which are not expected to receive
full tax benefit. If these losses are excluded for tax rate determination
purposes, there is no significant difference between the effective tax rate and
the statutory rate for the nine month period ended July 31, 1997.
FINANCIAL POSITION AND LIQUIDITY
At July 31, 1997, the Company had cash, cash equivalents and marketable
securities of $232.3 million and a long-term debt to total capital ratio of 15
percent.
The Company expects to have adequate resources available from operating cash
flows, cash and short-term investments, revolving credit and other banking
facilities, capital market sources and commercial paper to provide for its
capital needs for the foreseeable future. Operating activities generated $94.7
million in cash during the nine month period ended July 31, 1997, compared with
$304.4 million during the same period in 1996. The decrease in cash generated
from operating activities is due primarily to an increase in operating assets
and liabilities as well as the Company's lower operating results. Operating
working capital during 1996 was favorably impacted by a large customer advance.
The change in operating assets and liabilities from period to period is affected
by the mix, stage of completion, and commercial terms of engineering and
construction projects.
During the third quarter of 1997, the Company's equipment rental and sales
subsidiary acquired two additional equipment rental and sales companies that
will expand its operations throughout the eastern United States and California.
These acquisitions have been accounted for under the purchase method of
accounting and their results of operations have been included in the Company's
condensed consolidated financial statements from the respective acquisition
dates.
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During December 1996, the Company filed a shelf registration statement with the
Securities and Exchange Commission for the sale of up to $400 million of debt
securities. In March 1997, $300 million of 6.95 percent notes due March 1, 2007
were issued under this filing. Proceeds were used primarily to reduce
outstanding commercial paper issued to fund operating working capital, capital
expenditures and the repurchase of Company shares.
For the nine months ended July 31, 1997, capital expenditures were $350.9
million, including $210.9 million related to Massey Coal, comprised primarily of
mining equipment and coal preparation plant and other mine development costs.
Dividends paid in the nine months ended July 31, 1997 were $47.8 million ($.57
per share) compared with $42.6 million ($.51 per share) for the same period of
1996.
NEW ACCOUNTING PRONOUNCEMENTS
In June 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 131, "Disclosures about Segments of an
Enterprise and Related Information" (SFAS No. 131). SFAS No. 131 establishes new
standards for reporting information about operating segments in interim and
annual financial statements. This statement is effective for the Company's
fiscal year 1999.
In February 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 128, "Earnings Per Share" (SFAS No. 128).
SFAS No. 128 redefines the standards for computing earnings per share and is
effective for the Company's fiscal year 1998. The Company believes adoption of
the new standards will not have a material impact on future earnings per share
calculations.
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FLUOR CORPORATION
CHANGES IN BACKLOG
Three and Nine Months Ended July 31, 1997 and 1996
($ in millions)
UNAUDITED
For the Three Months Ended July 31, 1997 1996
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Backlog - beginning of period $ 16,136.5 $ 15,362.0
New awards 2,672.1 3,107.5
Adjustments and cancellations, net (255.0) (476.1)
Work performed (3,212.2) (2,394.2)
-----------------------------
Backlog - end of period $ 15,341.4 $ 15,599.2
=============================
For the Nine months Ended July 31, 1997 1996
- ---------------------------------------------------------------------------------
Backlog - beginning of period $ 15,757.4 $ 14,724.9
New awards 9,446.5 9,063.4
Adjustments and cancellations, net (793.9) (1,314.5)
Work performed (9,068.6) (6,874.6)
-----------------------------
Backlog - end of period $ 15,341.4 $ 15,599.2
=============================
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PART II: OTHER INFORMATION
Item 1. Legal Proceedings
In July 1997, Fluor Daniel Fernald, Inc. (formerly known as FERMCO),
reached a settlement in "U.S. ex rel William Watt v. Fluor Daniel,
Inc., et al." Fluor Daniel Fernald's former employee, William T. Watt,
had claimed damages for alleged violations of the False Claim Act. In
the settlement, Fluor Daniel Fernald agreed to pay $8.4 million, a
portion of which was paid to the U.S. government. The company will
recoup a portion of this amount from its teaming partners.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
27 Financial Data Schedule.
99.1 Current Report on Form 8-K filed May 6, 1997.
(b) Reports on Form 8-K.
The Form 8-K filed on May 6, 1997, addresses certain disclosures
in reports and statements released by the Company or statements
made by its officers or directors that are forward-looking in
nature, such as statements related to the Company's opinions
about trends and factors that may impact future operating
results. The Company filed this report in order to avail itself
of the safe harbor provided in the Securities Act of 1933 and the
Securities Exchange Act of 1934 with respect to any such
forward-looking statements.
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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: September 15, 1997 /s/ J. Michal Conaway
----------------------------------------
J. Michal Conaway, Senior Vice President
and Chief Financial Officer
/s/ V.L. Prechtl
----------------------------------------
V. L. Prechtl, Vice President and
Controller
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