USA: Fluor Reports Fourth Quarter and Full Year 2010 Results

Fluor Corporation announced financial results for its fiscal year ended December 31, 2010.

Net earnings attributable to Fluor for 2010 were $357 million, or $1.98 per diluted share, compared with $685 million, or $3.75 per diluted share in 2009. Consolidated segment profit for the year was $621 million, down from $1.25 billion a year ago. Full year results reflect profit growth in Government, Global Services and Power, offset by declines in the Oil & Gas and Industrial & Infrastructure segments. The Industrial & Infrastructure segment was impacted by pre-tax charges totaling $343 million on the Greater Gabbard Offshore Wind Farm project, including an incremental pre-tax charge of $180 million in the fourth quarter. Results also included the effect of a $152 million tax benefit in the fourth quarter. Consolidated revenue for the year totaled $20.8 billion, down 5 percent from $22.0 billion a year ago, mainly reflecting lower Oil & Gas activity throughout the year.

Full year new awards were a company record of $27.4 billion, up 48 percent from bookings of $18.5 billion a year ago, mainly due to strong mining & metals orders in the Industrial & Infrastructure segment and sizable orders in the upstream business within Oil & Gas. Year-end backlog rose to $34.9 billion, up 30 percent from a year ago and up $1.9 billion over last quarter. Fourth quarter awards were strong at $7.1 billion.

“Fluor had very strong new awards in 2010 which surpassed the company’s previous record and drove the backlog to just under $35 billion at year-end,” said Chief Executive Officer David Seaton. “While we experienced substantial challenges on the Greater Gabbard project during 2010, the company is well positioned for growth in 2011 and beyond as our markets and the global economy continue to strengthen.”

Corporate G&A expense for the year was reduced to $156 million, down from $179 million a year ago, mainly due to ongoing cost reduction initiatives and lower management incentive compensation. The low tax rate for 2010 was primarily attributable to the $152 million benefit from the tax restructuring of a foreign subsidiary in the fourth quarter. A significant portion of the tax benefit arose from the financial impact of the Greater Gabbard losses on the affected subsidiary. Fluor’s financial condition remains very strong, with cash plus current and noncurrent marketable securities totaling $2.6 billion, which is in line with our substantial cash position a year ago. During 2010, the company generated over $550 million in cash flow from operating activities, continued its share buyback with the repurchase of $175 million worth of Fluor shares and paid out $90 million in dividends.

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Source: Fluor, February 24, 2011;