This summary is based on the first quarter fiscal 2007 earnings call conducted by Fluor Corp. (FLR: chart) on May 8, 2007.

Chairman and Chief Executive Officer: Alan Boeckmann

Senior Vice President and Chief Financial Officer: Michael Steuert

Vice President of Investor Relations: Ken Lockwood

Key Investors Issues

- Earnings per share fell to 94 cents from $1 in the prior year quarter.
- Quarterly revenue was $3.6 billion, almost flat with last year.
- Capital expenditures for the quarter were $48 million.

First Quarter Fiscal 2007 Financial Highlights

Net earnings were $85 million or 94 cents per share compared with $89 million or $1 per diluted share for the same period last year.

Operating profit for the quarter was $177 million, compared with $184 million in the first quarter of 2006. All business segments posted substantial growth over last year, with the exception of the Government segment, which benefited from hurricane relief activities in the first quarter and throughout 2006. The operating margin was 4.9%, that compared with 5.1% a year ago which was also largely due to lower contributions from the government segment.

Revenue of $3.6 billion was level with the first quarter of 2006.

Strong growth in Oil & Gas and Global Services revenue offset an expected decline in the Government segment.

New project awards totaled $4.5 billion, up 17% from $3.8 billion a year ago.

This quarter included a $2.9 billion of awards in oil and gas with the balance representing a broad based mix across the other segments. The consolidated backlog rose to another new company record of $23.7 billion, up 54% from a year ago and up 8% sequentially over the prior quarter. The percentage of fixed price work in backlog is down to about 23% and work outside the United States is now at about 61%.

G&A for the quarter was $45 million, which compares to G&A of $42 million a year ago.

The first quarter year ago included $2.5 million of costs relating to the relocation of the corporate headquarters from California to Texas.

- The firm had net interest income of $4.2 million for the quarter compared with income of $185,000 a year ago. This is a reflection of an increased level of cash balances.
- The effective tax rate for the quarter was 37.9% compared with 37.8% in the first quarter of 2006.

- Consolidated cash balance increased to $1.1 billion, up from $976 million at year-end and up from $654 million a year ago. Approximately two-thirds of this cash is located outside the United States.
- Cash flow from operations in the quarter was strong contributing $168 million.
- The debt to total capital ratio was 25% at the end of the quarter. This is up slightly due to the growth in the non-recourse debt balance from the UK Highways Agency project.

- Capital expenditures for the quarter were $48 million with the majority attributable to the equipment services business, but also including some investment associated with the global expansion of workforce and the required infrastructure.
- Depreciation in the quarter was $35 million.

Performance Analysis of Segments

Fluor’s Oil and Gas segment reported its first quarter revenue of $1.7 billion, up 41% from the first quarter of 2006. Operating profit in that segment grew to $88 million, up 56% over 2006. The results reflect the significant ramp up in new project awards over the last two years. The operating margins were 5.3%, increasing from 4.8% just a year ago.