UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2001
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: 1-16129
FLUOR CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 33-0927079
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(State or other jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
One Enterprise Drive, Aliso Viejo, CA 92656
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(Address of principal executive offices)
(949) 349-2000
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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 April 30, 2001 there were 79,262,305 shares of common stock outstanding.
FLUOR CORPORATION
FORM 10-Q
March 31, 2001
TABLE OF CONTENTS PAGE
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Part I: Financial Information
Condensed Consolidated Statement of Earnings for the Three
Months Ended March 31, 2001 and April 30, 2000.................... 2
Condensed Consolidated Balance Sheet at March 31, 2001 and
December 31, 2000................................................. 3
Condensed Consolidated Statement of Cash Flows for the Three
Months Ended March 31, 2001 and April 30, 2000 ................... 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.................................................................. 19
1
Part I: Financial Information
FLUOR CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF EARNINGS
Three Months Ended March 31, 2001 and April 30, 2000
UNAUDITED
In thousands, except per share amounts 2001 2000
- -----------------------------------------------------------------------------------------------------
REVENUES $ 2,022,819 $ 2,295,662
----------------------------------------
COSTS AND EXPENSES
Cost of revenues 1,938,816 2,229,875
Special provision -- (17,919)
Corporate administrative and general expense 61,533 27,252
Interest expense 10,345 5,986
Interest income (2,936) (2,719)
----------------------------------------
Total Costs and Expenses 2,007,758 2,242,475
----------------------------------------
EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES 15,061 53,187
INCOME TAX EXPENSE 3,869 16,461
----------------------------------------
NET EARNINGS FROM CONTINUING OPERATIONS 11,192 36,726
EARNINGS FROM DISCONTINUED OPERATIONS, NET OF TAXES -- 14,316
----------------------------------------
NET EARNINGS $ 11,192 $ 51,042
========================================
BASIC EARNINGS PER SHARE
CONTINUING OPERATIONS $ 0.15 $ 0.49
DISCONTINUED OPERATIONS -- 0.19
----------------------------------------
NET EARNINGS $ 0.15 $ 0.68
========================================
DILUTED EARNINGS PER SHARE
CONTINUING OPERATIONS $ 0.15 $ 0.48
DISCONTINUED OPERATIONS -- 0.18
----------------------------------------
NET EARNINGS $ 0.15 $ 0.66
========================================
SHARES USED TO CALCULATE
BASIC EARNINGS PER SHARE 75,203 75,453
========================================
DILUTED EARNINGS PER SHARE 76,982 76,789
========================================
See Accompanying Notes
2
FLUOR CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
March 31, 2001 and December 31, 2000
UNAUDITED
March 31, December 31,
$ in thousands 2001 2000
- ---------------------------------------------------------------------------------------------------------------
ASSETS
Current assets
Cash and cash equivalents $ 97,358 $ 21,850
Accounts and notes receivable 747,998 680,836
Contract work in progress 369,784 366,223
Deferred taxes 119,836 116,753
Inventory and other current assets 171,875 196,596
--------------------------------------
Total current assets 1,506,851 1,382,258
Property, plant and equipment (net of accumulated
depreciation and amortization of $466,716 and
$450,709, respectively) 755,040 760,876
Investments and goodwill, net 202,538 192,795
Deferred taxes 99,628 82,452
Other 293,469 282,180
---------------------------------------
$ 2,857,526 $ 2,700,561
=======================================
(Continued On Next Page)
3
FLUOR CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
March 31, 2001 and December 31, 2000
UNAUDITED
March 31, December 31,
$ in thousands, except per share amount 2001 2000
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Trade accounts payable $ 592,336 $ 482,930
Short-term debt 184,881 227,793
Advances from affiliate 238,873 153,088
Advance billings on contracts 223,823 311,239
Accrued salaries, wages and benefit plans 280,582 288,699
Other accrued liabilities 192,329 184,332
-------------------------------------
Total current liabilities 1,712,824 1,648,081
-------------------------------------
Long-term debt due after one year 17,581 17,576
Other noncurrent liabilities 378,607 401,827
Contingencies and commitments
Shareholders' equity
Capital stock
Preferred - authorized 20,000,000 shares
without par value; none issued -- --
Common - authorized 150,000,000 shares
of $0.01 par value; issued and outstanding
- 78,496,998 shares and 74,609,050 shares, respectively 785 746
Additional capital 285,501 167,869
Unamortized executive stock plan expense (28,605) (32,411)
Accumulated other comprehensive income (loss) (47,496) (42,719)
Retained earnings 538,329 539,592
-------------------------------------
Total shareholders' equity 748,514 633,077
-------------------------------------
$ 2,857,526 $ 2,700,561
=====================================
See Accompanying Notes
4
FLUOR CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Three Months Ended March 31, 2001 and April 30, 2000
UNAUDITED
$ in thousands 2001 2000
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CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings $ 11,192 $ 51,042
Adjustments to reconcile net earnings to cash
provided by operating activities:
Depreciation and amortization - continuing operations 30,258 36,341
Depreciation, depletion and amortization - discontinued operations -- 43,412
Deferred taxes (16,059) 6,636
Special provision, net of cash paid (1,700) (20,148)
Asset write-off -- 17,762
Changes in operating assets and liabilities, excluding effects of
business acquisitions/dispositions 52,898 (114,556)
Equity in earnings of investees (12,854) (13,572)
Other, net (5,314) (3,917)
------------------------------------
Cash provided by operating activities 58,421 3,000
------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures - continuing operations (40,506) (108,498)
Capital expenditures - discontinued operations -- (42,509)
Proceeds from sale of property, plant and equipment 16,751 24,642
Investments, net 159 1,219
Other, net (618) (5,838)
------------------------------------
Cash utilized by investing activities (24,214) (130,984)
------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Cash dividends paid (12,455) (19,108)
(Decrease) increase in short-term borrowings (42,624) 143,690
Stock options exercised 97,006 18
Purchases of common stock -- (23,003)
Other, net (626) (1,534)
------------------------------------
Cash provided by financing activities 41,301 100,063
------------------------------------
Increase (decrease) in cash and cash equivalents 75,508 (27,921)
Cash and cash equivalents at beginning of period 21,850 148,130
------------------------------------
Cash and cash equivalents at end of period $ 97,358 $ 120,209
====================================
See Accompanying Notes
5
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 for each share of existing Fluor common
stock and retained their shares in existing Fluor, whose name was changed
to Massey Energy Company. 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 periods preceding the separation date are presented as
discontinued operations.
In connection with the reverse spin-off, the company changed to a calendar-
year basis of reporting financial results. For comparative purposes, the
fiscal year 2000 quarterly period that ended closest to March 31, (the
three months ended April 30, 2000 or the "comparison period") is presented
in the accompanying condensed consolidated financial statements and these
notes.
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
quarter ended March 31, 2001 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 March 31, 2001 and
its consolidated results of operations and cash flows for the three months
ended March 31, 2001 and April 30, 2000.
Certain December 31, 2000 amounts have been reclassified to conform to the
March 31, 2001 presentation.
6
FLUOR CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
UNAUDITED
(2) Inventories comprise the following:
March 31, December 31,
$ in thousands 2001 2000
---------------------------------------------------------------------
Equipment for sale/rental $ 75,506 $ 81,511
Supplies and other 35,269 35,053
----------------------------
$ 110,775 $ 116,564
============================
(3) Short-term debt comprises the following:
March 31, December 31,
$ in thousands 2001 2000
---------------------------------------------------------------------
Commercial paper $ 151,003 $ 191,720
Notes payable to banks 33,184 35,091
Trade notes payable 694 982
----------------------------
$ 184,881 $ 227,793
============================
(4) Advances from affiliate relate to cash received by a joint venture entity
from advance billings on contracts, which are made available to the
partners. Such advances are classified as an operating liability of the
company.
(5) Total comprehensive income represents the net change in shareholders'
equity during a period from sources other than transactions with
shareholders and as such, includes net earnings. For the company, the only
other component of total comprehensive income is the change in the
cumulative foreign currency translation adjustments recorded in
shareholders' equity.
The components of comprehensive income, net of related tax, are as follows
for the three-month periods ended March 31, 2001 and April 30, 2000:
$ in thousands 2001 2000
--------------------------------------------------------------------
Net earnings $ 11,192 $ 51,042
Foreign currency translation
adjustment (4,777) (4,031)
----------------------------
Comprehensive income $ 6,415 $ 47,011
============================
7
FLUOR CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
UNAUDITED
(6) Cash paid for interest was $15.0 million and $21.4 million for the three-
month periods ended March 31, 2001 and April 30, 2000, respectively.
Income tax payments, net of receipts, were $10.6 million and $26.3 million
during the three-month periods ended March 31, 2001 and April 30, 2000,
respectively.
(7) During 2001, New Fluor reorganized its business units to facilitate its
leadership as a single, highly focused company. The business units are
grouped into three segments: Engineering, Procurement and Construction
(EPC), Asset Services and Business Services and Other. The EPC segment
includes six business units: Energy & Chemicals, Duke/Fluor Daniel,
Manufacturing and Life Sciences, Telecommunications, Mining and
Transportation. The Asset Services segment includes three business units:
American Equipment Company, Fluor Federal Services and Global Services
(formerly Operations and Maintenance). The Business Services and Other
segment includes three business units: Fluor Signature Services (the
company's shared services organization), TRS Staffing Solutions and New
Ventures. Additionally, certain management costs that were previously
charged to business segments are now included in corporate administrative
and general expense. Prior year amounts have been restated to conform to
the current organization structure.
Total assets for the EPC, Asset Services and Business Services and Other
segments were $886.2 million, $822.3 million and $468.4 million,
respectively, at March 31, 2001, compared with $871.5 million, $808.1
million and $502.3 million, respectively, at December 31, 2000.
Operating information by segment for the company's continuing operations
are as follows for the three months ended March 31, 2001 and April 30,
2000:
Business
Asset Services
$ in millions EPC Services and Other Total
--------------------------------------------------------------------------
2001
External revenues $1,376.8 $594.4 $51.6 $2,022.8
Operating profit (loss) 65.0 26.5 (7.5) 84.0
2000
External revenues $1,731.3 $503.1 $61.3 $2,295.7
Operating profit (loss) 63.2 26.4 (4.5) 85.1
8
FLUOR CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
UNAUDITED
(7) (continued)
Reconciliation of Segment Information to Consolidated Amounts - For the
three months ended March 31, 2001 and April 30, 2000:
$ in millions 2001 2000
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Total segment operating profit $ 84.0 $ 85.1
Loss on business disposition not allocated
to a segment -- (19.3)
Special provision -- 17.9
Corporate administrative and general expense (61.5) (27.2)
Interest expense, net (7.4) (3.3)
--------------------
Earnings from continuing operations
before taxes $ 15.1 $ 53.2
====================
(8) 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
performed. Under certain limited circumstances, such foreign currency
payment provisions could be deemed embedded derivatives. As of March 31,
2001, the company had no significant embedded derivatives in any of its
contracts.
9
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; and gain or loss on discontinued operations.
FORWARD-LOOKING INFORMATION
Statements regarding the company's projected earning levels, new awards and
backlog levels and the implementation of strategic initiatives and
organizational changes are forward looking in nature. These forward-looking
statements reflect current analysis of existing information. Caution must be
exercised in relying on forward-looking statements. Due to known and unknown
risks, the company's actual results may differ materially from its expectations
or projections. Factors potentially contributing to such differences include,
among others:
. Changes in global business, economic, political and social conditions;
. The company's failure to receive anticipated new contract awards;
. Customer cancellations of, or scope adjustments to, existing contracts;
. Difficulties or delays incurred in the execution of construction contracts
resulting in cost overruns or liabilities;
. Customer delays or defaults in making payments;
. Difficulties and delays incurred in the implementation of strategic
initiatives; and
. Competition in the global engineering and construction industry.
While most risks affect only future costs or revenues anticipated by the
company, some risks may relate to accruals that have already been reflected in
earnings. The company's failure to receive payments of accrued amounts could
result in a charge against future earnings.
Additional information concerning these and other factors can be found in press
releases as well as 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 filed January 29,
2001. These filings are available either publicly or upon request from Fluor's
Investor Relations Department: (949) 349-3909. The company disclaims any
intent or obligation to update its forward-looking statements.
10
RESULTS OF CONTINUING OPERATIONS
Revenues for the three months ended March 31, 2001 were $2,022.8 million
compared with $2,295.7 million for the three months ended April 30, 2000. Net
earnings from continuing operations for the 2001 period were $11.2 million
compared with $36.7 million for the 2000 comparison period. Operating results
for the 2001 period were impacted by an unusual compensation charge totaling
$16.2 million after tax, reflecting the impact of the significant increase in
the company's stock price during the quarter on stock-based compensation plans.
Operating results for the 2000 comparison period were impacted by two unusual
items. First, $17.9 million of the special provision that was recorded during
fiscal year 1999 was reversed into earnings as a result of the company's
decision to retain ownership and remain in its current office location in
Camberley, U.K. Additionally, an unusual charge in the amount of $19.3 million
was recorded that related to the write-off of certain assets and the loss on the
sale of a European-based consulting business. Excluding the impacts of unusual
items, net earnings from continuing operations for the 2001 period were $27.4
million ($0.36 per diluted share) compared with $38.1 million ($0.50 per diluted
share) for the 2000 comparison period.
Consolidated new awards for the three months ended March 31, 2001 increased 43
percent to $2.5 billion from $1.8 billion in the comparison period of 2000.
Consolidated backlog at March 31, 2001 was $10.2 billion, an increase of 11
percent over the April 30, 2000 backlog of $9.2 billion. New awards and backlog
for the Asset Services segment are concentrated in the United States, while such
amounts for the Engineering, Procurement and Construction (EPC) segment include
significant international amounts. Approximately 27 percent of consolidated new
awards for the three months ended March 31, 2001 were for projects located
outside of the United States. As of March 31, 2001, approximately 45 percent of
consolidated backlog relates to international projects.
EPC
Revenues and operating profit for the EPC segment for the three-month periods
ended March 31, 2001 and April 30, 2000 are summarized as follows:
$ in millions 2001 2000
- -----------------------------------------------------------------------
Revenues $1,376.8 $1,731.3
Operating profit 65.0 63.2
Revenues decreased by 20 percent for the 2001 period compared with the 2000
period, primarily due to a decrease in work performed, which resulted from the
timing of contract performance.
Operating profit increased slightly for the 2001 period compared with the 2000
period. Expressed as a percentage of revenues, the operating profit margin was
4.7 percent for the 2001 period, a significant improvement over the 3.7 percent
realized in the 2000 comparison period.
11
New awards for the 2001 period were $2,076.8 million, compared with $1,615.7
million for the 2000 comparison period. The increase in new awards during 2001
has resulted from substantial increases in the new awards levels for the Energy
& Chemicals, Duke/Fluor Daniel and Manufacturing and Life Sciences business
units.
The following table sets forth backlog for each of the segment's business units:
March 31, December 31, April 30,
$ in millions 2001 2000 2000
- ----------------------------------------------------------------------------
Energy & Chemicals $3,518.6 $3,350.8 $3,298.6
Duke / Fluor Daniel 1,764.5 1,315.2 957.6
Manufacturing & Life Sciences 1,273.8 1,039.0 1,162.2
Telecommunications 438.1 883.8 821.3
Mining 665.7 694.3 1,036.8
Transportation 299.0 302.8 319.8
------------------------------------
Total EPC backlog $7,959.7 $7,585.9 $7,596.3
====================================
The increase in total backlog at March 31, 2001 compared with April 30, 2000 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. Backlog for the Telecommunications business unit at March 31, 2001
includes a $400 million downward adjustment for a reduction in scope on one
project.
ASSET SERVICES
Revenues and operating profit for the Asset Services segment for the three-month
periods ended March 31, 2001 and April 30, 2000 are summarized as follows:
$ in millions 2001 2000
- ---------------------------------------------------------------------
Revenues $594.4 $503.1
Operating profit 26.5 26.4
Revenues increased by 18 percent for the 2001 period compared with the 2000
period, primarily due to higher revenues at the Fluor Federal Services business
unit. Operating profit for the 2001 period did not vary significantly relative
to the 2000 comparison period. As a percent of revenues, however, it declined
to 4.5 percent during the 2001 period compared with 5.2 percent during the 2000
period. This decline resulted primarily from the renewal of two major
government contracts at the end of fiscal 2000 with terms that provide for
future incentives that will be recognized when they are earned.
12
New awards for the 2001 period were $457.4 million compared with $163.2 million
for the 2000 comparison period. The nature and size of Asset Services projects
can result in variability in new award levels from period to period.
The American Equipment Company business unit does not generate activity that is
included in backlog. The following table sets forth backlog for the segment's
other business units:
March 31, December 31, April 30,
$ in millions 2001 2000 2000
- ----------------------------------------------------------------------------
Global Services $1,788.5 $1,578.7 $1,267.1
Fluor Federal Services 435.5 602.1 324.7
--------------------------------------
Total Asset Services backlog $2,224.0 $2,180.8 $1,591.8
======================================
The increase in total backlog at March 31, 2001 compared with April 30, 2000 is
consistent with growth in new awards that occurred during the latter part of
fiscal year 2000. 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.
BUSINESS SERVICES AND OTHER
Revenues and operating loss for the Business Services and Other segment for the
three-month periods ended March 31, 2001 and April 30, 2000 are summarized as
follows:
$ in millions 2001 2000
- ----------------------------------------------------------------------
Revenues $51.6 $61.3
Operating loss (7.5) (4.5)
Operating losses of this segment relate primarily to New Ventures, which were
combined under a single point of oversight and accountability as part of the
organizational realignment during 2001.
OTHER
Net interest expense for the three months ended March 31, 2001 increased by $4.1
million compared with the three months ended April 30, 2000, as the result of
higher average levels of interest bearing obligations during 2001.
13
Corporate administrative and general expense for the 2001 period was $34.3
million higher than during the 2000 comparison period as the principal result of
the unusual stock-based compensation charge of $25.0 million pretax ($16.2
million after tax) discussed above. During the 2000 comparison period, a credit
of $4.0 million was recorded relative to such stock-price based programs.
The effective tax rate of the company's continuing operations, exclusive of the
impact of the unusual compensation charge, was 31.5 percent for the 2001 period.
This rate is approximately the same as the effective tax rate for the three
months ended April 30, 2000, excluding the impacts of the two unusual items
recorded during that period.
FINANCIAL POSITION AND LIQUIDITY
At March 31, 2001, the company had cash and cash equivalents of $97.4 million
and a total debt to total capitalization ratio of 21.3 percent, compared with
cash and cash equivalents of $21.9 million and a total debt to total
capitalization ratio of 27.9 percent as of December 31, 2000.
Cash flows have not been restated to exclude discontinued operations, and
therefore include the Coal segment for the 2000 comparison period. Cash
provided by operating activities was $58.4 million during the three months ended
March 31, 2001, compared with $3.0 million during the three months ended April
30, 2000. Although net earnings and depreciation, depletion and amortization
were lower during the 2001 period than the 2000 comparison period, a substantial
decline in the level of net operating assets and liabilities associated with
engineering and construction activities, including a significant increase in the
level of advances from affiliate, had a more than offsetting favorable impact.
The level of operating assets and liabilities is affected from period to period
by the mix, stage of completion and commercial terms of the projects.
Cash utilized by investing activities totaled $24.2 million during the 2001
period compared with $131.0 million during the 2000 period. The 2000 amount
includes $42.5 million of capital expenditures for discontinued operations.
Capital expenditures for continuing operations in the 2000 period included
Knowledge@Work, equipment purchases and facility acquisition costs. Capital
expenditures during the 2001 period included Knowledge@Work and equipment
purchases.
Cash provided by financing activities totaled $41.3 million during the three
months ended March 31, 2001 compared with $100.1 million for the three months
ended April 30, 2000. During 2001, the company decreased its short-term
borrowings by $42.6 million, compared with an increase of $143.7 during the 2000
comparison period. Stock option exercises provided $97.0 million during the
2001 period, compared with only a nominal amount during the 2000 period.
Dividends paid during the 2001 period were $12.5 million ($0.16 per share),
compared with $19.1 million ($0.25 per share) during the 2000 comparison period.
In connection with a stock buyback program approved by the Board of Directors on
March 8, 2000, the company purchased 747,000 shares of its common stock for
$23.0 million during the 2000 comparison period.
14
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 March 31, 2001 and December 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, Dutch guilders, German marks and Spanish pesetas for U.S. dollars. The
total gross notional amount of these contracts at March 31, 2001 and December
31, 2000 was $95.3 million and $73.0 million, respectively. Forward contracts
to purchase foreign currency amounted to $95.2 million and $72.6 million and
forward contracts to sell foreign currency totaled $0.1 million and $0.4 million
at March 31, 2001 and December 31, 2000, respectively.
15
FLUOR CORPORATION
CHANGES IN CONSOLIDATED BACKLOG
Three Months Ended March 31, 2001 and April 30, 2000
UNAUDITED
$ in millions 2001 2000
- ------------------------------------------------------------------------------
Backlog - beginning of period $ 9,766.7 $ 9,238.7
New awards 2,534.2 1,778.9
Adjustments and cancellations, net (251.8) 274.8
Work performed (1,865.4) (2,104.3)
------------------------------
Backlog - end of period $10,183.7 $ 9,188.1
==============================
16
PART II: Other Information
Item 4. Submission of Matters to a Vote of Security Holders.
(a) Date of Meeting. The annual meeting of shareholders of Fluor
Corporation was held on March 14, 2001 at the Fluor Engineering
Campus, Aliso Viejo, California
(b) Election of Directors - Voting Results
Directors elected -
Carroll A. Campbell, Jr.
66,715,152 FOR
361,030 VOTED TO WITHHOLD AUTHORITY
James T. Hackett
66,714,605 FOR
361,577 VOTED TO WITHHOLD AUTHORITY
Lord Robin W. Renwick
66,722,430 FOR
353,752 VOTED TO WITHHOLD AUTHORITY
Martha R. Seger
66,703,812 FOR
372,370 VOTED TO WITHHOLD AUTHORITY
James C. Stein
66,680,753 FOR
395,429 VOTED TO WITHHOLD AUTHORITY
Other directors continuing in office -
Alan L. Boeckmann (appointed March 14, 2001)
Philip J. Carroll, Jr.
Peter J. Fluor
David P. Gardner
Thomas L. Gossage
Bobby R. Inman
Vilma S. Martinez
Dean R. O'Hare
James O. Rollans
(c) Matters Voted Upon. Ratification of the appointment of
Ernst & Young LLP as independent auditors for 2001:
66,633,390 FOR
178,147 AGAINST
264,645 ABSTAIN
-0- BROKER NON-VOTE
(d) Terms of settlement between registrant and any other participant.
None
17
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
None
(b) Reports on Form 8-K.
None
18
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: May 15, 2001 /s/ R. L. Albright
------------ --------------------------------------------
R. L. Albright, Vice President and
Deputy Chief Financial Officer
/s/ V. L. Prechtl
--------------------------------------------
V. L. Prechtl, Vice President and Controller
19